Dear Mark Zuckerberg: Meta Was a Risky Investment Long Before the Metaverse

WhenMeta ’s contribution plummet last weekin response to yet another dark earnings account , most psychoanalyst pointed toMark Zuckerberg ’s compulsion with the Metaverseas the reservoir of the company ’s woes . And while it ’s dead on target that Zuckerberg ’s Metaverse experiment to day of the month has been underwhelming , these analyst are miss the forest for the tree . Meta has a much self-aggrandizing problem in that the company is go bad to tax and mitigate risk in both the shortsighted and long term . Until Meta essentially vary way , investor are right to be skeptical about the company ’s future .

At its core , Meta ’s direction structure is fundamentally broken due to the company ’s treble division shareholder complex body part . This structure gives Zuckerberg and select members of his intimate R-2 stronger ballot power comparative to independent shareowner , allow him with near total control over major management decision and efficaciously silencing protest . While most corporations are hold to be more responsive to shareholders , Meta can simply shrug off critic .

In practice , this has allowed Meta to ignore business concern about short and long term risk . But as the expiration of 1000000000000 in valuation over the course of instruction of 2022 has demonstrated , putting on blinker and ignoring threats and risks to the company is not an in force direction scheme .

Photo: Pool (Getty Images)

A shareholder proposal call for an independent audit of the committee ’s work and a public report , would have slough some light on the company ’s risk direction . Unsurprisingly , the company oppose the resolution and , thanks to the three-fold class social organisation , it was voted down at this yr ’s yearly shareholder meeting , despite receiving support from proxy advisor Glass Lewis . Meanwhile , Meta go along to be engross in scandal . Last gloaming , company whistleblower Frances Haugen released documentsrevealing Meta ’s own inquiry show its products were toxic for stripling . On a nearly weekly base , newrevelationsaboutMeta ’s contentmoderation problemsemerge . And to date , the company has been finedbillionsof dollars by regulators across the globe for actus reus ranging fromcampaign law finance violationsto failing to adequatelyprotect user privacy . The badly - advised wager on the Metaverse just add to Meta ’s myriad woes .

Meta has essay to be a risky investment independent of Zuckerberg ’s laser - like focus on the Metaverse . It ’s no surprisal that as the strain price carry on to pass up investor are demanding accountability from Zuckerberg who , as the chair , CEO , and largest shareowner , calls the guessing . Given the company ’s downward trajectory , criticisms of Zuckerberg ’s leadership will only mount . The question is whether Meta ’s board , which at least feigns independency , will take any action or continue allow Zuckerburg free rein . Unless and until the plug-in steps up , Meta ’s failure to evaluate and palliate risk will leave behind investor wary of the company ’s time to come .

Melanie Sloan is a former lawyer for the House Judiciary Committee and a current Senior Advisor for the safari for Accountability , a nonpartizan watchdog organization that seeks to expose misconduct and malfeasance in public liveliness . Christina O’Connell is a Senior Manager for Shareholder and Investments at SumOfUs , a global protagonism organization that agitate for incarnate accountability .

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