Why Facebook’s Share Plan Should Alarm Pensions and SWFs

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Social networking giant Facebook is seeking to issue a new class of shares in a bid to permit its founder Mark Zuckerberg the ability to maintain greater control. Zuckerberg is keen on creating a new class of stock with no voting rights, a practice that many U.S. pensions frown upon. For example, the California Public Employees’ Retirement System (CalPERS) has taken an active approach to influence corporate governance globally chastising firms that embrace dual-class and multi-class share structures. The concept of “one share, one vote” resonates with these types of public pension funds.

Norway’s Sovereign Wealth Fund

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