The appointment earlier this week of Facebook Chief Operating Officer Sheryl Sandberg to the social network’s board of directors eliminated the lack of female voices on the group, but another type of voice is still lacking, according to blog Seeking Alpha.
Contributor IncomeHunter points out that while Facebook’s board, as currently composed, contains many strong voices, those voices come from similar backgrounds: They are all entrepreneurs.
In addition to Sandberg, the board includes:
Marc Andreessen, Andreessen Horowitz
Erskine Bowles, president emeritus, University of North Carolina system
James Breyer, Accel Partners
Donald Graham, chairman and CEO, The Washington Post Co.
Reed Hastings, chairman and CEO, Netflix
Peter Thiel, Founders Fund
This board is heavy on fabled entrepreneurs and underrepresents management experience in established companies. This is critical because Facebook’s key issue is how to radically monetize its user base. Although this board is a remarkable resource for starting great companies, it is less useful at transitioning existing startups into profit-generating machines. Analysts are increasingly concerned about how Facebook will make money. They are right to be so, and investors should not hold their breath.
Any discussion of Facebook’s corporate governance should mention how Co-Founder and CEO Mark Zuckerberg has unshakable control. The company’s two share classes with differential voting rights give Zuckerberg 57 percent of voting rights over the firm, although he retained a minority 28 percent stake of Facebook ownership. Although Zuckerberg is a brilliant young man, he is not perfect. Checks and balances are missing from this setup.
Readers: Do you agree that Facebook needs to change the composition of its board of directors?
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