The $224.4 billion California State Teachers’ Retirement System is putting its foot down on Facebook’s governance policies.
Last week, CalSTRS’ CIO Chris Ailman deactivated his account on the social media juggernaut, announcing via Twitter that the company’s “lack of oversight” and “poor management,” which he called “offensive,” were his reasons for its deletion.
This follows the recent information that political analytics firm Cambridge Analytica collected data from the profiles of millions of users with no consent, which caused Facebook’s stock to plummet. According to CNBC, Ailman said that Facebook has to “deal better with their privacy issues.” CNBC said the events raised concerns that government regulations could clamp down on founder and CEO Mark Zuckerberg’s digital empire.
To further back Ailman’s decision and clarify the fund’s stance on Facebook’s policies, Aeisha Mastagni, portfolio manager in the CalSTRS Corporate Governance Unit published a statement on the fund’s website.
“As an active shareowner, CalSTRS focuses on engaging with our portfolio companies in order to address their risk mitigation strategies,” Mastagni said. “We are currently establishing contact with Facebook to learn more about what controls are in place today to protect users’ data into the future. Additionally, we would like to understand what additional steps Facebook is taking to protect this data in order to regain the trust of their users, the public, and their shareholders.
On April 11, Zuckerberg is scheduled to testify in front of Congress.
As of Dec. 31, 2017, CalSTRS owns nearly $1 billion in Facebook shares.