In a widely followed story, Tesla has replaced Elon Musk with a new board chair. The decision has come in accordance with an agreement between Tesla and the US Securities and Exchange Commission. Tesla has selected Australian executive Robyn Denholm as the new chairman. Robyn Denholm already serves as the chief financial officer of Telstra. Telstra is the leading telecom company in Australia. Denholm has also been an independent director of the Tesla board since 2014. Even though Denholm’s job as the new chairman begins immediately, she will leave her position at Telstra after a six-month notice.
Denholm is also the head of the strategy at Telstra. She has previously worked in several tech companies. Some of these include Sun Microsystems and Juniper Networks. In a statement, Denholm has said:
“I believe in this company. I believe in its mission and I look forward to helping Elon and the Tesla team achieve sustainable profitability and drive long-term shareholder value.”
The Controversy
It has been reported on various accounts that Tesla removed Musk over several controversies surrounding him. His demeanor, as one, has been putting a question mark over his leadership for quite a while now. Musk has been on Tesla’s board since 2004 but recently his behavior was off the rails.
The final nail came this August when Elon Musk famously tweeted about making Tesla private. Musk allegedly claimed that he had even secured a deal. His announcement was to make Tesla private at 420 dollars per share. These tweets by Musk claiming to withdraw Tesla from the stock exchange were found to be fraudulent. As a result of this unusual behavior by the chairman of a leading company, US authorities asked Tesla to replace Musk. The settlement came after lawsuits by shareholders and an SEC investigation.
The whole scenario put the company in foreseeable strain for months. Musk’s behavior was not worthy of a leader expected to pull his company out of troubled waters. To put a cherry on top, Elon Musk also famously smoked weed in public during an interview. This recent development led to the authorities giving Tesla until November 13 to find a new chairman.
The Settlement
Tesla sought a settlement with the SEC over the case of misleading tweets by Musk. The two parties finally reached one in mid-September. The SEC agreed to let Musk be the CEO if he would leave his post of chairman of the board. Musk had been the chairman for the last three years. In a tweet, Elon Musk has reacted to Denholm’s appointment.
“Would like to thank Robyn for joining the team. Great respect. Very much look forward to working together.”
Other than replacing Musk, Tesla also had to add two new and independent members to its board. SEC claimed that its aim in this was to make sure there was enough oversight to match the current status of Tesla. SEC has also made Tesla agree to oversee any future tweets by Musk that could jeopardize investors’ shares in the company.
The world agrees on Elon Musk being a charismatic visionary who worked very hard to make Tesla a profitable, mass-market producer of environmentally friendly electric cars. Current happenings have proven that his demeanor, however, fails to agree with his position at Tesla.
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