Tesla is currently looking for a new Chairman since Elon Musk is going to have to resign in the coming months due to his settlement with the SEC.
EV enthusiasts want someone who is all-in with Tesla’s mission.
Now Fox’s James Murdoch is being floated as the lead candidate… among a few others. Is Tesla going in the right direction?
As part of the settlement with the SEC over comments about the attempt to take the company private, Tesla and Musk agreed to several actions to restructure the board:
- Musk will step down as Tesla’s Chairman and be replaced by an independent Chairman. Musk will be ineligible to be re-elected Chairman for three years;
- Tesla will appoint a total of two new independent directors to its board;
- Tesla will establish a new committee of independent directors and put in place additional controls and procedures to oversee Musk’s communications;
Musk has to resign by the end of the year.
Several names have been floated, but now Fox’s James Murdoch seems to a contender.
A new report from the Financial Times based on anonymous sources says that Murdoch, who has been on Tesla’s board since last year, is the “lead candidate” and wants the job:
“Two people briefed on the discussions said Mr Murdoch, who is currently a non-executive director of Tesla, was the lead candidate for the job, which is required by the SEC to be an independent chairman. Another person said external options were still being considered”
The same report states that Musk would prefer Antonio Gracias, Tesla’s lead independent director and longtime investor in the company, but he might not be considered independent enough in the eyes of the SEC.
Tesla has been under pressure before to elect new independent board members, which it did last year when they appointed JPC CEO Linda Johnson Rice and 21st Century Fox CEO James Murdoch.
Murdoch was the most controversial choice amongst Tesla investors due to long history of his media outlets promoting climate change denial.
The automaker still has some time before making a final decision and it also has to appoint two new independent board members, which will also have to be elected by shareholders. The choice for Chairman might end up being one of those two new directors and therefore currently external from the company.
Externally, names like Al Gore and Alan Mulally have been floated, but it’s unclear how seriously they are being considered if at all.
While the board’s main role is to act in the interest of the shareholders, I think it’s fair to say that in Tesla’s case, shareholders are also buying into Tesla’s mission.
Therefore, protecting Tesla’s mission should be one of the top priority of Tesla’s board if not the top priority.
As an EV enthusiast, I think we want someone who is all-in with Tesla’s mission to accelerate the world’s transition to sustainable energy.
I don’t know James Murdoch well-enough to say that he truly believes or not in the mission, but I certainly understand where the doubts about him are coming from.
Over the year, I’ve never doubted Musk’s belief in the mission, which is why it’s disappointing to see him having to resign from the role of Chairman.
The question is what would make shareholders truly believe that another chairman would be all-in with Tesla’s mission? Let us know what you think in the comment section below.
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