Musk names a 'close friend' to Tesla board

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Musk names a close friend to Tesla board
The inclusion of Larry Ellison puts one of the world's richest people with experience building a startup into a successful company on Tesla's board.

New York - Move aimed at providing independent oversight demanded by US regulators following Tesla CEO's controversial (and very costly) tweet

By Reuters

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Published: Sat 29 Dec 2018, 7:36 PM

Last updated: Sat 29 Dec 2018, 9:39 PM

Tesla named Oracle co-founder Larry Ellison, a shareholder and self-described close friend of chief executive Elon Musk, to its board to provide the independent oversight demanded by US regulators.
The move is meant to usher Tesla past months of turbulence following Musk's August 7 tweet that he was considering taking the company private and had secured funding.
The fallout, which included the US Securities and Exchange Commission subsequently filing fraud charges against Musk for what it said were his "false and misleading" tweets, led some investors to call for stronger board oversight of Musk.
The inclusion of Ellison puts one of the world's richest people with experience building a startup into a successful company on Tesla's board. He served as a director at Apple at a critical time for that company - in the five years after Steve Jobs returned to the helm of the then struggling computer maker in 1997, helping oversee one the greatest turnarounds in corporate history.
Joining Ellison on the board, effective December 27, was Walgreens Boots Alliance's global head of human resources, Kathleen Charles Elson, director of the corporate governance center at the University of Delaware, questioned adding a friend of Musk's and another director with no experience at an industrial company like Tesla.
"Why would you put a friend [on the board] if the idea of the two independent directors were to be objective," Elson said. "Investors who were hoping for two newly objective directors who could stand up to Mr Musk would be rather disappointed by the choice."
Under a court-approved agreement with the SEC, Musk agreed to pay a $20 million fine and step aside as Tesla's chairman for three years to settle charges that could have forced his exit. Tesla also agreed to name the independent directors and a board committee to control Musk's communications.
SEC officials could not be reached to comment on Friday, but Harvey Pitt, the agency's former chairman, called the addition of Ellison a positive step.
"His personal investment in Tesla stock - said to be his largest personal investment outside of Oracle - means he will be focused on ensuring that Tesla develops profitable strategies," Pitt said. "He also has the stature to stand up to Mr. Musk, should that become necessary."
Tigress Financial Partners analyst Ivan Feinseth said Ellison's "maverick type CEO traits" match Musk's.
Ellison bought 3 million shares of Tesla earlier this year. Through a spokeswoman, he declined to comment.
Tesla's shares closed up 5.6 per cent at $333.87 on Friday.
Musk tweeted his welcome: "Excited to have Larry Ellison & Kathleen Wilson-Thompson join the Tesla board!"


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