US. Pension fund joins action against Facebook
The California State Teachers’ Retirement System has joined a derivatives case against Facebook in regards to Cambridge Analytica.
The litigation at hand is a pending derivative lawsuit against Facebook’s leadership, including the social media company’s chief executive, Mark Zuckerberg.
CalSTRS said intervening in the existing derivative suit will give it the opportunity to pursue corporate governance reform.
Its aim is to “protect Facebook’s profitability, strengthen the resiliency of its business model and enhance the long-term value of Facebook as a corporation”, believing that weak corporate governance practices contributed to the misuse of private data and damage to Facebook’s bottom line.
This is evident in the aftermath of Cambridge Analytica scandal, where Facebook users’ private data was compromised: Facebook saw a $119 billion dollar drop in its stock price – the largest single-day loss in market history.
“CalSTRS has engaged with Facebook on numerous occasions to press for core governance standards such as board diversity, board independence, and proportionate voting rights that are central to ensure accountability at public companies,” CalSTRS portfolio manager of sustainable investment and stewardship strategies Aeisha Mastagni said.
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