Abu Dhabi, UAEWednesday 23 September 2020

Mark Zuckerberg's wealth plunges by $7bn as companies boycott Facebook ads

The social media company's share-price drop eliminated $56bn from its market value

Mark Zuckerberg just became $7.2 billion poorer after a flurry of companies pulled advertising from Facebook’s network.

Shares of the social media company fell 8.3 per cent on Friday, the most in three months, after Unilever, one of the world’s largest advertisers, joined other brands in boycotting ads on the social network.

Continuing to advertise on these platforms at this time would not add value to people and society.

Unilever

Unilever, which owns names like Hellmann’s mayonnaise and Axe shower gel and has an annual advertising budget of almost $8 billion (Dh29.38bn), said it won’t advertise on Facebook, Twitter and Facebook-owned Instagram for the rest of the year because of the hate speech and polarised politics that users often post.

“Continuing to advertise on these platforms at this time would not add value to people and society,” Unilever said in an emailed statement. “We will be monitoring ongoing and will revisit our current position if necessary.”

The Facebook share-price drop eliminated $56bn from the company’s market value and pushed Mr Zuckerberg’s net worth down to $82.3bn, according to the Bloomberg Billionaires Index. That also moved the Facebook chief executive down one notch to fourth place, overtaken by Louis Vuitton boss Bernard Arnault, who was elevated to one of the world’s three richest people along with Jeff Bezos and Bill Gates.

Companies from Verizon Communications to Hershey have also stopped social media ads after critics said that Facebook has failed to sufficiently police hate speech and disinformation on the platform. Coca-Cola said it would pause all paid advertising on all social media platforms for at least 30 days.

Mr Zuckerberg responded on Friday to the growing criticism about misinformation on the site, announcing the company would label all voting-related posts with a link encouraging users to look at its new voter information hub. Facebook also expanded its definition of prohibited hate speech, adding a clause saying no adverts will be allowed if they label another demographic as dangerous.

“There are no exceptions for politicians in any of the policies I’m announcing here today,” Mr Zuckerberg said.

Twitter shares also tumbled on Friday following the Unilever announcement, dropping 7.4 per cent to $29.05.

A consortium of civil rights and other advocacy groups, including Color of Change and the Anti-Defamation League, have called on advertisers to stop spending on Facebook-owned platforms for the month of July to protest the company’s policies. Honda's US unit said on Friday that it would join the boycott and halt advertising on Facebook and Instagram in July. Unilever’s commitment extends that pledge through 2020, and adds rival social network Twitter to the mix, which has also struggled to deal with offensive posts but has recently taken a more active stance than Facebook in some cases related to US President Donald Trump.

So far, the boycott organisers say that more than 100 companies are participating.

“We invest billions of dollars each year to keep our community safe and continuously work with outside experts to review and update our policies,” a Facebook spokeswoman said in a statement, adding that the company has banned 250 White supremacist organisations from its platforms. “We know we have more work to do, and we’ll continue to work with civil rights groups, GARM, and other experts to develop even more tools, technology and policies to continue this fight.”

Twitter, which has not been the target of the formal ad boycott but has faced similar criticisms as Facebook over the years, says that Unilever reached out to alert the company of its decision before making the announcement publicly.

“Our mission is to serve the public conversation and ensure Twitter is a place where people can make human connections, seek and receive authentic and credible information, and express themselves freely and safely,” said Sarah Personette, Twitter’s vice president of global client solutions, in a statement. “We are respectful of our partners’ decisions and will continue to work and communicate closely with them during this time.

Updated: June 27, 2020 12:06 PM

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