A Change in Leadership Doesn’t Equate a Change in Policy

Following a recent report that claims that Facebook hired a Washington D.C. based public relations (PR) firm known as Definers Public Affairs — which focuses on political consultancy and primarily deals with opposition research — major investors are calling for Zuckerberg to resign.

One of the most vocal and notable of the group is U.S. investor Jonas Kron.

Definers actively worked to discredit activist protesters, often attempting to link them to billionaire and heavyweight liberal donor George Soros; they also lobbied a Jewish civil rights group to accuse some Facebook critics of antisemitism.

“Facebook is behaving like it’s a special snowflake,” stated the senior VP of Trillium Asset Management, “It’s not. It is a company and companies need to have a separation of chair and CEO.”

“The latest report should remove any lingering doubts that some may have had,” said Kron.

According to a damaging expose released by the New York Times, Definers actively worked to discredit activist protesters, often attempting to link them to billionaire and heavyweight liberal donor George Soros; they also lobbied a Jewish civil rights group to accuse some Facebook critics of antisemitism.

Soon after, Facebook appointed Sir Nick Clegg to conduct a review of Facebook’s use of lobbying firms.


Kron, who has $10.9 million at stake with the company, was happy with the appointment, but ultimately viewed it as “insufficient.”

Labeling the appointment as a “whack-a-mole” move, Kron felt that the attempt ignored the main issue, that Facebook needs an independent board chair.

He wasn’t the only disgruntled investor.

As reported by The Telegraph, Julie Goodridge, chief executive of Facebook investor NorthStar Asset Management, which owns over 50,000 shares in the company, called the move “crazy.”

“I don’t think you can appoint someone who is essentially still subservient to the board and subservient to top level management,” she said. “You can’t expect that person to come in and really have the kind of power that Zuckerberg, Sandberg, Peter Thiel, and the other board members have. What powers is this guy really going to have?”

These Class B shares are owned by Zuckerberg and a select few insiders, and they amount to almost 70 percent of total voting shares, with nearly 60 percent going to Zuckerberg alone.

Other investors, such as Natasha Lamb, a managing partner at Arjuna Capital, have called for a change in Zuckerberg’s Class B voting shares.

A closer look into these voting share classifications shows why investors are so upset as the current hierarchy leaves many investors with little to no actual control over the direction of the company or its policies.

This is due to the fact that unlike Class A shares, which have a single-vote-per-share value, Class B shares hold a ten-vote-per-share value.

These Class B shares are owned by Zuckerberg and a select few insiders, and they amount to almost 70 percent of total voting shares, with nearly 60 percent going to Zuckerberg alone.


Even if Zuckerberg (392.71 million shares) is removed from his position as chairman and his voting shares are converted from Class B to Class A status, there’s no guarantee that changes will occur, due to secondary Class B shareholders.

The most concerning individuals are Dustin Moskovitz, (48.9 million shares) Sheryl Sandberg, (2 million shares) and Michael Schraepfer (716, 987 shares).

Moskovitz, the second largest of Class B shareholders, is particularly troubling due to a controversial voting agreement, as he, like many others, has given Zuckerberg “irrevocable proxy” to control his votes.

To assume that the company’s modus operandi would sufficiently change without independent oversight would be criminally naive. The way that Facebook is currently running is profitable and with the chance — however unlikely — that Zuckerberg is forced to step down, those who still have a stake in the company’s success will likely do whatever possible to keep things the way they are.

And while Sandberg and Schraepfer are among the smaller Class B shareholders, their personal interests form a dark cloud over ethical objectivity. Sandberg is Facebook’s Chief Operating Officer (COO) and Schraepfer is Facebook’s Chief Technology Officer (CTO).

Interestingly enough, Sheryl Sandberg was the acting overseer of Facebook and Definers Public Affairs’ aggressive lobbying campaign.

It’s safe to assume that both employees, being in affluent positions within the tech-giant, wouldn’t want the company’s value to drop any more than it has to, if at all. Which, according to investor Julie Goodridge, would likely happen to share values, if Zuckerberg were to step down.

To presume that the company’s modus operandi would sufficiently change without independent oversight would be criminally naive. The way that Facebook is currently running is profitable and with the chance — however unlikely — that Zuckerberg is forced to step down, those who still have a stake in the company’s success will likely do whatever possible to keep things the way they are.

Don’t believe me? Check out their newest product: Portal. A camera that can listen to, watch and follow you as you walk throughout your house.

As if owning Instagram wasn’t enough.

It’s apparent that Facebook is unconcerned with everything that has happened following the Cambridge Analytica scandal. They are counting on John Q. Public to forget about their misdeeds and move on to the next controversy.

It’s up to us to let them know that we haven’t forgotten. That Facebook needs to change. Regardless of whoever is acting chairman.

Feature Photo: Credit to ThoughtCatalog at Unsplash.com
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