• Forbes, Thursday, May 24, 2012 9:25 AM

Dan Bigman explores the social network's share structure, a dual-class arrangement founder Mark Zuckerberg set up wherein the Class-B shares he controls carry 10 times the voting power of the A shares. "That means he owns about 18% of the company, but controls more than 50% of the voting power," notes Bigman. That isn't unusual, but he cites a study that finds that heavy control by company insiders weakens performance. "They tend to take on more debt, rather than dilute control through share offerings than single-share companies. Other studies found CEOs enjoy higher levels of compensation and shareholders enjoy less return on capital investments, while wasting cash and chasing goals that are personally important to those in control–not shareholders."

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