Tesla has named Larry Ellison and Kathleen Wilson-Thompson to the board on Friday, Dec. 28, 2018, in compliance with SEC settlement. The appointments will add needed business and the expertise of human resources to the board, although it has added to the questions about CEO Elon Musk’s control.
Wilson-Thompson is the global head of human resources at Walgreens Boots Alliance and a former executive at Kellogg. Ellison is the co-founder and executive chairman of Oracle. Recently, she disclosed his personal stake in Tesla.
“I am very close friends to Elon Musk and I am a very big investor in Tesla,” stated Ellison at a financial analyst meeting at the Oracle OpenWorld conference in October.
According to a company spokesperson, Ellison owns 3 million shares of Tesla stock. At Friday’s opening price, that stake would be worth nearly $1 billion. In October, Ellison stated that Tesla was his second-largest holding and defended Musk against ongoing criticism.
“You’re telling me he is an idiot. I just want to know who you are so I know why I should believe you as opposed to my friend Elon.”
In September, Musk and Tesla agreed to appoint a new chairman and two independent board members after an SEC lawsuit that alleged Musk misled investors with a tweet that spoke about making the company private at $420 a share. Friday morning, Tesla shares rose 3 percent.
Tesla’s existing directors released a statement:
“In conducting a widespread search over the last few months, we sought to add independent directors with skills that would complement the current board’s experience. In Larry and Kathleen, we have added a preeminent entrepreneur and a human resources leader, both of whom have a passion for sustainable energy.
Historically, Tesla’s board has been linked to the CEO and includes his brother Kimbal Musk. The stipulation of the SEC settlement was intended to introduce more oversight for the CEO, who has dragged the company’s stock lower with his unchecked use of social media.
Board member Robyn Denholm was named chairwoman in November. She is an experienced, predictable choice. Investors and analysts were hoping for a independent, outside chairperson to keep Musk in check.
The two new board members were supposed to be independents, through Ellison’s personal ties to Musk leave room for concern.
A spokesperson from Tesla downplayed Ellison’s and Musk’s personal relationship, stating the two had only socialized in group settings a handful of times. Apparently, the two have not even spoke in the year leading up to Ellison’s appointment to the board.
Steve Jurveston, who has been a longstanding board member and venture capitalist, has been on leave from the board for more than a year, after reports of sexual misconduct. The reports led to Jurveston being ousted from the venture firm he founded, DFJ, which backed Tesla and SpaceX, also owned by Elon Musk.
Other than appointing new board members, Tesla is supposed to form a committee to oversee other terms of the SEC settlement and institute controls over the company and Musk’s statements about Tesla on social media.
Ellison and Wilson-Thompson began serving on the board effective yesterday, according to Tesla.
By Jeanette Smith
CNBC: Tesla names two new independent directors after SEC settlement
Image Courtesy of Maurizio Pesce’s Flickr Page – Creative Commons License