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The shareholders' revolt on Facebook is expected to trigger a period of "deep research" for the company.
This is what the small, militant investor who waged the war against billionaire Mark Zuckerberg's huge power on Facebook, the company he founded in 2004, says.
At Facebook's annual shareholder meeting last month, Trillium Asset Management proposed to overthrow Zuckerberg as chairman and replace him with an independent executive. Trillium controls Facebook shares worth about $ 9 million.
The proposal was supported by 68% of independent investors (versus 51% who voted in favor of an almost identical proposal in 2017), but it was ultimately rejected due to Zuckerberg's hold on voting power .
According to Trillium, the support of Independent Principal Susan Desmond-Hellmann has also been less supportive than usual. It was re-elected by 67% of foreign investors, compared to 76% last year.
Jonas Kron, executive vice president of Trillium, told Business Insider that the votes "clearly exposed the concern expressed by traditional investors," which should prompt a period of "extensive research by the board of directors. from Facebook".
He called the new board members – Jeff Zients, the CEO of investment firm Cranemere, and former American Express CEO, Kenneth Chenault – to take particular note investor troubles.
Read more: Facebook investors open a new front in the war against Mark Zuckerberg: they now want an independent investigation into his "disproportionate" power
"These are highly respected, highly qualified and accomplished personalities who are able to scrutinize votes and speak as independent shareholder advocates," Kron said.
Facebook has been silent on the issue for the past two weeks and has not responded to Business Insider's request for comment.
Earlier this week, a spokesman referred us to the company's proxy statement, which stated that hiring a chairman over Zuckerberg could create more problems than it would solve.
"We do not believe that requiring the chair of the chair to be independent would provide significantly better management and performance, and could instead cause inefficiency in the functions and relationships of the board and management. ", said Facebook in the rankings.
Meanwhile, in a private correspondence with restless shareholders, Facebook highlighted the changes to governance last year, strengthening the power of its audit committee, which is now chaired by Zients, to him. empowering to review the firm's services, privacy and cyber security. .
Kron said investors have a strong intention to build on their momentum and continue to press. New York City Comptroller Scott Stringer, who controls about $ 785 million worth of shares on Facebook, released an appeal this week asking Facebook to commission an independent review of its governance structure. It is likely that another proposal will empty Zuckerberg next year. shareholder meeting.
"We do not make a difference," said Kron. "The concentration of power is so wrong, no matter who that person is, it inevitably leads to bad decisions."
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