We are all aware that 32 year old Facebook founder, Mark Zuckerberg, holds greater part of the voting control of the social networking site. But, in future, if he decides to quit or if his service is terminated, then he may not remain an absolute power at Facebook. According to PC Worlsd report, on June 29 at the annual meeting the board will ask shareholders to vote on a proposal that would convert Zuckerberg’s Class B shares into Class A shares. This step will be taken only if the Facebook founder ceases to be at the wheel.
As we know Class A stock has one vote per share while Class B stock has 10 votes per share, which gives Zuckerberg, majority voting power and control over Facebook’s strategic direction. Quoting the filing the report added the aim of the regulations is apparently to make it easier for the company to hire a top-quality successor to Zuckerberg who would not be shadowed by the founder or be from his family. At present, Zuckerberg holds both Class A and Class B common stock that would jointly be about 53.8 per cent of the company’s total voting power. The report further said under current rules, if Zuckerberg were to quit the company or his employment terminated for any reason, he would not be required to give up his majority voting control.
In December, on the occation of his birthday, in order to advance human potential and promote equality for children Zuckerberg and his wife Priscilla Chan had pledged to donate 99 per cent of their Facebook shares. At present there is no news about the Facebook founder’s intention of quiting, therefore the above steps appears to be just a precaution taken. The new provisions will make certain that Facebook will not remain a founder-controlled company after we cease to be a founder-led company. The filing said that the new rules would provide significant value to our company by incenting Mr. Zuckerberg to remain with our company.
