Meta-shareholders slam Zuckerberg, questioning ‘dystopian disadvantages’

A group of angry shareholders say that Mark Zuckerberg’s weak management has caused Meta’s share to fall by 34% this year – and they plan to push for control of the CEO’s power, The Post has learned.

Concerned investors make two decisions at the social media titan’s upcoming shareholders’ meeting, which they say will provide much-needed oversight of Facebook, Instagram and the potential “dystopian disadvantages” of Mark Zuckerberg’s metaverse project.

In an attempt to strike a chord, a corporate responsibility group called SumOfUs, which works with activist investors, sends a report to more than 4,000 institutional investors with ownership interests in the company – among them Vanguard, Fidelity and BlackRock.

The scathing report, obtained exclusively by The Post, describes three crises that “engulf” Zuckerberg’s business: privacy restrictions from Google and Apple, which have hit Meta’s advertising business, the storm of antitrust cases and bills targeting Meta and other major tech companies. companies, as well as allegations that Zuckerberg has lied to investors and lawmakers about Instagram’s harmful effects on teens.

The group blames these crises directly on Zuckerberg, who they say has failed to prove that his recent embrace of the meta-verse is anything more than a “hasty attempt to divert attention from fundamental issues with Meta’s core business.”

Christina O’Connell, SumOfUs’ shareholder engagement adviser, told The Post that Meta’s plummeting share price should wake investors.

Shareholders are concerned about the “dystopian disadvantages” of Mark Zuckerberg’s metaverse pet project.
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“When you see a loss of over $ 230 billion in February, it shakes everyone, and that should be a sign that it’s time for a change,” O’Connell said.

The first decision, which SumOfUs is pushing for with shareholders Harrington Investments and the Park Foundation, calls for an external assessment by Meta’s audit and risk oversight committee, a board that the company set up in 2020 that is allegedly independent of Zuckerberg and makes decisions on content moderation . such as former President Donald Trump’s ban on Facebook and Instagram.

“There’s a real concern that given the amount of issues we’ve seen with the company, the committee is not managing the company’s behavior and performance very well,” O’Connell said. “We would like to see an independent analysis of how the committee works.”

The second resolution raises alarm about “potential psychological and civil and human rights violations” associated with Zuckerberg’s metaverse push.

The proposal is supported by SumOfUs together with the responsible investment fund Arjuna Capital, the investor advisory group SHARE and Storebrand, a Norwegian asset manager that manages more than $ 100 billion.

The groups want Meta to order an external audit of the metaverse’s potential risks – such as the potential for harassment and hate speech, as well as privacy concerns – and then seek a shareholder vote to assess whether investors support the project.

“Meta has not been able to deal with its problems here in the world where we all live, so it’s pretty shocking that they want to move into a more complex platform such as metaverse,” O’Connell said. “Injuries to children, harassment, hate speech – it all gets amplified when you start moving into the metaverse.”

Mark Zuckerberg
Mark Zuckerberg can effectively veto shareholder decisions because of his “super vote” shares.
Getty Images for SXSW

Meta’s board of directors has urged shareholders to vote against both resolutions, calling them “unnecessary.”

Meta’s untraditional ownership structure allows Zuckerberg to effectively veto any shareholder’s attempt to change the company’s operations. His stake in Meta consists mainly of “super-vote” shares, allowing him to control about 58% of the votes when the company is considering shareholder proposals.

Nevertheless, O’Connell argues that shareholder action is still one of the best ways to pressure Zuckerberg to change his ways.

The decisions were included in Meta’s proxy statement, which was sent to shareholders on Friday.

Shareholders will now vote on the resolutions ahead of Meta’s annual shareholders’ meeting, which is set for May 25. Supporters of the proposals will be allowed to speak at the virtual meeting, and the result of the vote will be announced afterwards.

“Even when shareholder decisions do not win the majority, they have an impact on the board and management and also inform the wider public that shareholders are concerned about what is going on,” O’Connell said. “We want to see real corporate governance. We want to see competent management of this company.”

Asked for comment on the resolutions, a Meta spokesman said: “We value the views of our investors and engage with them regularly to gain their perspective. We look forward to continuing the dialogue, including at our annual shareholders’ meeting in May.”

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