Facebook Inc. – which has renamed itself “Meta” to reflect its growing product range and also its desire to distance itself from the Cambridge Analytica scandal – is an exemplar of contemporary corporate success. Since its founding in 2004, it has grown into a nearly trillion dollar company (in terms of market capitalisation) with almost three billion users worldwide. It prioritised growth, especially, in the number of its users and the veracity of engagement with their platforms (Facebook, Instagram, WhatsApp in particular).
Growth but at what cost?
While Facebook is an outstanding performer in growth terms, it scores (much) less well in its environmental, social and governance (ESG) performance. Even when this high-growth darling is held to account, by government investigations, its modus operandi – in terms of corporate responsibility – does not change.
Facebook’s role in the Cambridge Analytica scandal of 2018 is one of five deep-case studies in my doctoral research, which asks: ‘To what extent does holding CEOs to account personally for crises effect corporate responsibility?’. On 10 April 2018, fourteen years after Facebook was established, Mark Zuckerberg, Facebook’s Founder, CEO & Chairman testified to Congress about Cambridge Analytica. In Room 2123 of Rayburn House, in Washington DC, he accepted personal responsibility under oath, “It was my mistake, and I’m sorry. I started Facebook, I run it, and I’m responsible for what happens here”; and committed the company to “…taking steps to make sure this doesn’t happen again”
My research is motivated to understand if such proceedings, especially those that strive to hold corporate leadership to account, are effective in improving ESG performance. To do so, I analyse congressional records; corporate communications; ESG disclosures; Securities and Exchange Commission filings and stock market data in a five-year framework to assess change in corporate responsibility and to monitor persistence before and after a corporate crisis, such as Facebook’s Cambridge Analytica crisis.