Why Mark Zuckerberg thinks Facebook’s board should be in public view

By Elizabeth Darst, CNNMoney Facebook has been making a case that the SEC should add another reason to treat it as a public company: the board that oversees it. The social network wants the…

By Elizabeth Darst, CNNMoney

Facebook has been making a case that the SEC should add another reason to treat it as a public company: the board that oversees it.

The social network wants the Securities and Exchange Commission to let it hold its board meetings in camera, which is now prohibited at many public companies.

Like many public companies, Facebook held its meeting in a dark room decorated with shades and sometimes curtains to shield investors and the public from what was happening inside.

Facebook has always had a majority of female board members, but a little more than half of its board is male. The New York Times reported earlier this year that Facebook’s board ratio was currently at 53 men to 15 women.

And, the website The Information reported this week that Facebook underperformed this year when it came to women board members. It will start shortening its board’s term this year, just as many other companies increase their numbers. Facebook says that may be due to increasing the number of board members with any relevant experience.

But the potential added wrinkle for Facebook could be the SEC, which opened the door to a larger pool of potential board members for short-term trading in May.

Since that decision, companies have been posting on their websites when board appointments are made. Earlier this week, Google Chief Legal Officer David Drummond was appointed to a three-year term on Facebook’s board. That was before Facebook’s annual meeting.

Drummond and the other new board members joined Facebook in May, just as the SEC opened the way for them to be considered for short-term trading. The so-called “short-term trading rules” give members of the public the opportunity to buy and sell stock within days after one member is added to the board.

The SEC allowed companies to make their short-term trading information public if they received prior written authorization from a majority of board members.

Google received that approval on Wednesday. It gives the search engine company the majority of directors needed to announce a share repurchase of at least $5 billion. The agreement also prevents Google from repurchasing its own stock unless it receives board approval.

Other new directors include Brenda Milne, Facebook’s VP of commercialization, and Mike Cassidy, the chair of the company’s engineering board. Their term starts on Nov. 7.

“As we’ve worked to grow the size of our board, we’ve sought the broadest possible mix of directors and are pleased to have elected Mike, Brenda and David to join us. Their diverse backgrounds, backgrounds and experience will contribute to the work we do together to grow Facebook,” Facebook CEO Mark Zuckerberg said in a statement.

“We think that making it easier for the public to trade our shares prior to our board appointment is a good thing. We’re committed to doing our part to provide more information and transparency for investors and our users.”

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