Friday, December 28, 2018
Tesla named Larry Ellison and Kathleen Wilson-Thompson to its board on Friday, in compliance with an SEC settlement. The appointments add needed business and human resources expertise to the board — though add to 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 co-founder and executive chairman of Oracle, and recently disclosed a massive personal stake in Tesla.
"I am very close friends to Elon Musk and I am a very big investor in Tesla," Ellison said at a financial analyst meeting at the Oracle OpenWorld conference in October.
Ellison owns 3 million shares of Tesla stock, according to a company spokesperson. That stake would be worth close to $1 billion at Friday's opening price. In October, Ellison said Tesla was his second-largest holding and staunchly defended Musk against ongoing criticism of his behavior.
"You are 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," Ellison said at the time.
Tesla and Musk agreed in September to appoint a new chairman and two independent board members after an SEC lawsuit alleging that Musk misled investors with a tweet about taking the company private at $420 a share.
Shares of Tesla rose as much as 3 percent Friday morning.
"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," Tesla's existing directors said in a statement.
Tesla's board has historically been tightly linked to its CEO and includes, among others, his brother Kimbal Musk. The stipulation in the SEC settlement was intended to introduce more oversight of the CEO, who has dragged the company's stock lower with his unchecked use of social media and other antics.
Existing board member Robyn Denholm was named chairwoman in November. Denholm was seen as an experienced, though predictable pick at the time, but investors and analysts had been hoping for a truly independent, outside chairperson to fully check Musk.
The two new board members are supposed to be independents, as well, though Ellison's personal ties to Musk leave some room for concern.
A Tesla spokesperson downplayed Ellison's and Musk's personal relationship, saying the two had only socialized a handful of times and always in a group setting. The spokesperson said Musk and Ellison had not spoken for about a year leading up to Ellison's appointment to the board.
Meanwhile, longstanding Tesla board member and venture capitalist Steve Jurvetson has been "on leave" from the board for over a year, after reports of his sexual misconduct. Those reports led to his being ousted from the eponymous venture firm he founded, DFJ, which backed both Tesla and Elon Musk's other company, SpaceX.
Besides appointing new board members, Tesla is supposed to form a committee to oversee other terms of the SEC settlement, and institute controls over both the company's and Elon Musk's statements about Tesla on Twitter and elsewhere.
Ellison and Wilson-Thompson began serving on the board effective Thursday, Tesla said.
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