Role of Sand­berg comes into ques­tion

Face­book COO has been key to cre­at­ing success

USA TODAY International Edition - - FRONT PAGE - Jes­sica Guynn

SAN FRAN­CISCO — The es­ca­lat­ing cri­sis over Face­book’s han­dling of users’ per­sonal in­for­ma­tion has some peo­ple ask­ing: Where was Sh­eryl Sand­berg?

Mark Zucker­berg’s sec­ond-in-com­mand runs Face­book’s op­er­a­tions and over­sees its ad­ver­tis­ing busi­ness, plac­ing her in a nearly un­ri­valed role of re­spon­si­bil­ity when as many as 87 mil­lion Face­book users had their data si­phoned by Cam­bridge An­a­lyt­ica, a Bri­tish firm with ties to Don­ald Trump’s 2016 pres­i­den­tial cam­paign.

“Sh­eryl did an un­par­al­leled job, the best any per­son has ever done in any com­pany at cre­at­ing a busi­ness,” said David Kirk­patrick, au­thor of the Face­book Ef­fect and founder of the Te­chon­omy con­fer­ence busi­ness. But the lack of vig­i­lance over se­cu­rity and pri­vacy has im­per­iled that success, he said.

“If Mark hired her to set poli­cies, some­thing went wrong, be­cause the poli­cies didn’t get set,” Kirk­patrick said.

Scru­tiny will only in­ten­sify as the Fed­eral Trade Com­mis­sion in­ves­ti­gates whether Face­book vi­o­lated a 2011 agree­ment to get per­mis­sion from users be­fore shar­ing their data, U.S. law­mak­ers draw up leg­is­la­tion that could re­strict what the com­pany does with that data and stricter pri­vacy laws go into ef­fect next month in Eu­rope, says Piv­otal Re­search Group an­a­lyst Brian Wieser.

“It’s hard to imag­ine that for all of the op­er­a­tional prob­lems they have had that there wouldn’t be more scru­tiny on whether or not there are com­pany-wide risks the board needs to in­volve it­self with,” Wieser said.

Sand­berg, who de­clined an in­ter­view re­quest from USA TO­DAY, did not ac­com­pany Zucker­berg last week when the Face­book CEO tes­ti­fied be­fore Congress. But for the past decade, the best-known No. 2 ex­ec­u­tive in Amer­i­can busi­ness has been by his side.

Their part­ner­ship has been held out as a model of Sil­i­con Val­ley success — the busi­ness vet­eran work­ing hand in glove with a less ex­pe­ri­enced founder to build a hugely suc­cess­ful busi­ness that gen­er­ates bil­lions of dol­lars by get­ting peo­ple to open up about their lives.

For Sand­berg, Face­book el­e­vated

her pro­file in the busi­ness world and served as a spring­board to be­com­ing a house­hold name as she opened up about her own life in two deeply per­sonal books, Lean In, a best­seller cham­pi­oning women in the work­place, and Op­tion B, a med­i­ta­tion on love, loss and re­silience af­ter the sud­den death of her hus­band Dave Gold­berg in 2015.

“At this point, it’s hard to imag­ine Face­book with­out Sh­eryl,” Zucker­berg said in a Face­book post last month on her 10-year an­niver­sary with the com­pany. Call­ing her “a great friend and part­ner,” Face­book’s co-founder and CEO wrote: “I know we face many dif­fi­cult chal­lenges, but there’s no one I trust more to work through this with.”

The most dif­fi­cult chal­lenge so far: Cam­bridge An­a­lyt­ica. Af­ter long days and late nights hun­kered down with Zucker­berg while the pub­lic fumed, Sand­berg hit the in­ter­view cir­cuit in re­cent weeks to apol­o­gize for Face­book’s lapses. Inside Face­book, Sand­berg is run­ning point, mar­shal­ing com­pany re­sources and as­sem­bling SWAT teams, to make good on prom­ises Zucker­berg has made to Congress and Face­book users.

In 2014, some 300,000 Face­book users down­loaded a per­son­al­ity quiz app, This Is Your Dig­i­tal Life. The re­searcher be­hind the app col­lected data not just on those users but on their Face­book friends, too, and then passed that data on to Cam­bridge An­a­lyt­ica. Face­book failed to alert in­di­vid­ual users that their data had been im­prop­erly har­vested un­til last week.

The Face­book plat­form that al­lows soft­ware de­vel­op­ers to reach Face­book users does not fall un­der Sand­berg’s area of re­spon­si­bil­ity. But the Cam­bridge An­a­lyt­ica cri­sis erupted as Face­book’s ad­ver­tis­ing busi­ness was al­ready tak­ing fire for al­low­ing Rus­sian op­er­a­tives to tar­get ads us­ing fake ac­counts dur­ing the pres­i­den­tial elec­tion in an ef­fort to sow po­lit­i­cal dis­cord and sway voter opin­ion.

In a se­ries of in­ter­views, Sand­berg took re­spon­si­bil­ity for fail­ing to en­sure that Face­book op­er­a­tions had enough staff to pro­tect users’ pri­vacy. “On the things we didn’t do that we should’ve done that are un­der my purview, that’s my re­spon­si­bil­ity and I own that,” she told Buz­zFeed.

But she’s also been quick to point out that the leak of Face­book user data to Cam­bridge An­a­lyt­ica was not con­nected to Face­book’s ad­ver­tis­ing busi­ness. And she has de­fended the busi­ness which re­lies on the mass col­lec­tion of Face­book users’ data, say­ing it ben­e­fits con­sumers.

That mes­sage may not be res­onat­ing with Face­book users who, af­ter years of shrug­ging off pri­vacy con­cerns, have be­gun won­der­ing if sur­ren­der­ing their data to the gi­ant so­cial net­work is too high a price for on­line ac­cess to their friends.

A sur­vey of 1,000 Amer­i­cans dur­ing the first week of April by tech­nol­ogy re­search group Creative Strate­gies found that 9% had deleted their Face­book pro­files and 35% said they were us­ing Face­book less fre­quently.

“The bot­tom line is, if you had to pick any one per­son re­spon­si­ble for cre­at­ing the cir­cum­stances that led to this sit­u­a­tion, it is Sh­eryl Sand­berg,” Sil­i­con Val­ley fu­tur­ist Paul Saffo said.

The ad­ver­tis­ing en­gine hatched in the early days pow­ered Face­book’s ini­tial pub­lic of­fer­ing in 2012 and turned Face­book into a must-buy for ad­ver­tis­ers.

To­day Face­book makes nearly all its rev­enue and profit from ad­ver­tis­ing and has a mar­ket value of $478 bil­lion, the sixth-largest in the S&P 500. With Google, Face­book ef­fec­tively has a “dig­i­tal du­op­oly,” con­trol­ling 56.8% of the on­line ad­ver­tis­ing mar­ket, ac­cord­ing to eMar­keter. Face­book’s U.S. rev­enue from ad­ver­tis­ing is ex­pected to jump 17% to $21 bil­lion this year, the re­search firm says.

Be­fore mov­ing to Sil­i­con Val­ley to join Google, Sand­berg served as chief of staff to Trea­sury Sec­re­tary Lawrence Sum­mers dur­ing the Clin­ton ad­min­is­tra­tion when she was 29. Over the years, she has de­vel­oped a vast so­cial net­work that bridges tech­nol­ogy and politics.

With the prospect of reg­u­la­tion loom­ing, Face­book is for­tu­nate to have a leader who knows the capi­tol cor­ri­dors so well, says Michael Useem, pro­fes­sor at the Whar­ton School at the Univer­sity of Penn­syl­va­nia.

“For a long time, Face­book was not in the cross hairs of Wash­ing­ton,” Useem said. “But now it is.”

Sh­eryl Sand­berg

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