In what many observers view as the first step toward going public, Facebook announced that it was implementing a dual-class stock structure, The New York Times reported.

Current shares in the social-networking site would be converted to class-B shares, which would equal 10 votes apiece in matters of corporate governance, while new class-A shares, which would be sold in an initial public offering, would carry one vote each, the Times reported.

Facebook spokesman Larry Yu told the Times:

We did introduce a dual-class stock structure because existing shareholders wanted to maintain control over voting on certain issues to help ensure that the company can continue to focus on the long term to build a great business. This revision to the stock structure should not be construed as a signal that the company is planning to go public.

University of Delaware professor of corporate governance Charles Elson told Financial Times:

Dual-class stock is an anathema to institutional investors. Ultimately, shareholders lose. If something were to go wrong, there’s absolutely nothing they can do about it.