Facebook CEO Mark Zuckerberg arrived on the Hill Monday morning to kick off a week of hearings on data privacy concerns related to the company’s relationship with third parties, such as Cambridge Analytica. If his written testimony is any indication, Zuckerberg plans to lead with a message of personal accountability.
“We didn’t take a broad enough view of our responsibility, and that was a big mistake. It was my mistake, and I’m sorry. I started Facebook, I run it, and I’m responsible for what happens here,” said Zuckerberg in prepared testimony released in advance of his April 11 House Energy and Commerce Committee hearing.
It’s a noteworthy approach from a chairman and CEO who has been publicly questioned about a governance structure that some say makes him less accountable.
Because Zuckerberg claims a controlling number of voting shares, Facebook investors don't have considerable sway and, if so inclined, activist investors might find it difficult to produce actual change.
With more than 2 billion monthly users, a Vox article wondered last week, perhaps normal corporate governance policies really don’t scale to a platform like Facebook. Vox Editor Ezra Klein noted that Facebook is almost more government-like than business-like when one considers the implications of its policies. “When Facebook gets it wrong, the consequences are on the scale of when a government gets it wrong. Elections can lose legitimacy, or ethnic violence can break out,” Klein said.
But make no mistake, if Facebook functions like a government, Zuckerberg's controlling stake sways it away from being a democracy.
“One of the things that I feel really lucky we have is this company structure where, at the end of the day, it’s a controlled company. We are not at the whims of short-term shareholders. We can really design these products and decisions with what is going to be in the best interest of the community over time,” said Zuckerberg in the Vox interview.
In a call with reporters last week, the CEO reportedly said he wasn’t aware of any plans by the board to replace him. But shareholders have been vocal in their concerns about Facebook leadership. In an appearance on CNBC, New York City Comptroller Scott Stringer, who oversees the city’s pension funds, said “we think there needs to be more independent board oversight.”
“I think there needs to be an independent chairman of the board. I think we need more independent directors and directors that have experience in terms of data and ethics and all the things that these emerging, huge companies need in light of what has happened,” said Stringer.
The California State Teachers’ Retirement System is also demanding answers on the controls Facebook has in place to protect user data and future plans to mitigate risk.