A meeting between Facebook management and organizers of an advertiser boycott reportedly ended at an impasse.
The NYTimes reported that the meeting, which involved top Facebook executives, the Anti-Defamation League, the National Association for the Advancement of Colored People (NAACP), civil rights group Color of Change and other activists, lasted more than an hour but failed to appease the company's critics. Facebook (FB) - Get Report shares fell 1.3% in after hours trading after closing at a record high.
The boycott, dubbed #StopHateforProfit, is a protest of Facebook's policies on hate speech, voter suppression and misinformation. It's gained steam for several weeks, with hundreds of brands pledging to pull ad budgets from Facebook and Instagram at least through July. A number of major advertisers, such as Unilever and Coca-Cola, have signed on to the boycott.
Prior to Tuesday's meeting, the boycott's organizers made a range of requests to Facebook regarding its policies and operations, including hiring a top executive with a civil rights background, submitting to regular outside audits and updating its community standards. Organizers told reporters after the meeting that Facebook did commit to enacting the suggestions.
“The company’s recent announcements have been incremental, rather than the kind of bold action needed to seriously address the harmful impact of voter disinformation and hate speech on the platform," said Vanita Gupta of The Leadership Conference on Civil and Human Rights, and Sherrilyn Ifill of the NAACP in a joint statement. "Our conversation today with Facebook’s leadership was a continuation of our ongoing efforts to push the company toward substantive change to its policies governing voter suppression and disinformation."
Facebook COO Sheryl Sandberg announced that the meeting was taking place in a Facebook post earlier on Tuesday, and also said that the results of Facebook's ongoing civil rights audit, described as a "two-year review of our policies and practices" from a civil rights perspective, will be released on Wednesday.
"This meeting was an opportunity for us to hear from the campaign organizers and reaffirm our commitment to combating hate on our platform. They want Facebook to be free of hate speech and so do we," said a Facebook spokesperson after Tuesday's meeting.
The company outlined a number of actions it has taken in recent weeks around hate speech and misinformation, including prohibiting ads that discourage people from voting and banning 250 white supremacist organizations from Facebook and Instagram. The company also recently removed an ads from the Trump re-election campaign that contained a symbol associated with Nazi Germany, citing policies against organized hate.
In a note last week, Needham analyst Laura Martin wrote that at least for some brands, the boycott is likely to extend through the November election owing partly to the likelihood of heated political discourse on the platform.
Brands are "happy to weaken Facebook's iron grip on their ad budgets," according to Martin, who also lowered her sales and earnings estimates for Facebook's 2020 and 2021. Martin expects 2020 revenue of $74.589 billion, compared to a prior estimate of $78.812 billion, and earnings of $6.80 per share versus $7.47 prior, partly due to the impact of the boycott.
Facebook shares are up 15% year to date.