From Nils Pratley in the Guardian:
Facebook’s board has heard the calls for the appointment of an independent chair, from New York City’s pension fund for example, and decided to ignore them.
In doing so, the board seems to have accepted Zuckerberg’s bizarrely loose version of accountability. Allowing the data of up to 87 million people to be “inappropriately shared” with Cambridge Analytica was “my responsibility”, he said in answer to a later question. It was also a “huge mistake” not to focus on abuse of data more generally. But, hey, “life is about learning from the mistakes and figuring out what you need to do to move forward”.
This breezy I-promise-to-do-better mantra would be understandable if offered by a school child who had fluffed an exam. But Zuckerberg is running the world’s eighth largest company and $50bn has just been removed from its stock market value in a scandal that, aside from raising deep questions about personal privacy and social media’s influence on democracy, may provoke a regulatory backlash.
In these circumstances, why wouldn’t a board ask whether it has the right governance structure? The motivation would be self-interest. First, there is a need to ensure that the company isn’t run entirely at the whim of a chief executive who is plainly a technological whizz but admits he failed to grasp Facebook’s responsibilities as the number of users exploded to 2 billion. Second, outsiders, including users, advertisers and politicians, want reassurance that Facebook has basic checks and balances in its boardroom.
The lack of interest in governance reform is explained, of course, by the fact that Zuckerberg has a stranglehold over Facebook’s voting shares. His economic interest is 16% but he has 60% of the votes and thus, for practical purposes, can’t easily be shifted from either of his roles…
This is the flip side of the determination of some tech founders to insulate themselves from the quarterly whims of Wall Street. The Google boys have the same arrangement. Given the malign short-termism of Wall St and the doctrine of maximising shareholder value, this might have seemed sensible or even enlightened at one time. Now it looks like bad corporate governance.