“The revolution is being tweeted. Social media have enabled political uprisings in the Middle East, the global Occupy movement and even a swift blowback against banking fees in the United States. A logical next step would be for Facebook, Twitter and their ilk to intensify the voice of the investing masses…”
“It would take just one high-profile victory to wake up corporate executives, and sleepy institutional investors, to the idea that Facebook is more than just a powerful marketing channel for their brands.”
So writes Jeffrey Goldfarb in Time for boards to make a friend of Facebook, 2/23/2012, The Globe and Mail. Marcy Murninghan brought the article to my attention as a possibility that would be important. While Facebook certainly could be used by Boards to test the waters on governance issues, I find the prospect ironic, considering Facebook’s own governance structure outlined in their IPO. A dictatorship facilitating democracy?!
As Fay Feeney quipped “The cobbler’s kids have no shoes.” So, maybe Facebook will facilitate democracy outside their own fortress. See Facebook’s Corporate Governance Puts Off Activist Investors.
At this point, I think the social media awakening is more likely to come via Proxy Democracy or MoxyVote.com where platforms facilitate branding and followings. More interactive sites like the US Proxy Exchange (USPX) facilitate better cooperation between shareowners, while Sharegate.com may provide the next step beyond Facebook by both facilitating interaction between shareowners as well as between shareowners and their companies.
You certainly don’t have to be democratic to facilitate democracy. Just look at the slave holding founding fathers. Their “all men are created equal” certainly was an aspirational statement. Maybe Facebook’s corporate structure will inspire push back within its own structure but the framework certainly seems limiting.
How important is the structure of organizations pushing for more democratic corporate governance? CorpGov.net is a sole proprietorship, the antithesis of an organization. Proxy Democracy is a 501(c)(3). MoxyVote.com is a private company affiliated with TFS Capital, a registered investment advisor. The US Proxy Exchange (USPX) is a 501(c)(6) and Sharegate.com is another private company. It will be interesting to see how we evolve.
To contact James McRitchie directly, please email jm@corpgov.net.
Christopher Bayer, Ph.D. says:
Social network tools and platforms are fantastic mediums for communication. They have truly revolutionized the world across a myriad of dimensions. They have provided channels for people to share: ideas, information, data of all sorts and types, passions, visions, dreams, hopes, aspirations…..
At this juncture social networking has an opportunity to impact shareholder activism on a grand scale if f they have the courage and wherewithal.
McRitchie’s observation is well taken: the paradox of Facebook, for example, having the power to impact and implement democracy from a structure that is dictatorial and controlling.
Now the question is: will social networking platforms contribute even more significantly to corporate governance and shareholder activism. They have a unique opportunity to do so, and have true impact on corporate culture. However, they want to enrich their already abundant coffers. It is, indeed, an intriguing evolutionary question and process as McRitchie asserts.