(Bloomberg) – The board of directors of Tesla Inc. is at a critical moment, wedged between a larger than life-size to whom many are personally close and their greater responsibility towards shareholders.
The astounding interview of Elon Musk with the New York Times has fueled concerns about the health of Tesla's chairman and chief executive officer, with shares that have dropped 8.9 percent. Friday, the biggest decline in almost two years. The references to the use and driving characteristics of Ambien during tweeting encourage the management of Tesla to supervise the CEO and the company's largest shareholder.
"If the board takes any initiative, they will put it in check," said Maryann Keller, an independent analyst in the automotive industry in Stamford, Connecticut. "He does not do the shares and the perception of him as a leader."
Musk, in a tweet on Sunday Responding to an open letter from "sleep evangelist" Arianna Huffington urging him to change his work habits is excluded from taking a different course. "Ford & Tesla are the only 2 American auto companies that want to avoid bankruptcy, I have just returned from the factory, you think this is an option, it is not."
In the Times-interview, Musk said that he did not remember the communication of the board and that he "received absolutely no phone calls from irate directors" after his 7th of August tweet that he had "secured funding" to go private. Later he changed the remark via a spokeswoman, saying that the independent leader Antonio Gracias had contacted him about the tweet. Musk agreed not to tweet again about the possible transaction without discussing it with the board, said the spokeswoman.
One of the challenges of guiding a peripatetic entrepreneur is that running Tesla is not his only job. He is also chairman and CEO of the innovative rocket manufacturer SpaceX and has created two other entities that meet the demands of his time.
"It is clear that Musk can not keep running four companies at the same time," says Stephen Diamond, associate professor at Santa Clara University, specializing in corporate governance. "Tesla has and deserves a full-time, exclusive CEO, but the first question that the board needs to clarify is this: Is Tesla for sale or not? If they are going to occupy this go-private idea from Musk & # 39; s, they are obliged to get the highest possible share price. "
This was not the case this week. After the shares had risen to a record level in the day of $ 387.46 on August 7, it has had the worst week since 2016, ending at $ 305.50.
But at Musk & # 39; s companies it is largely business as usual. Tesla employees at the assembly plant in Fremont, California, said they are focused on making cars, but they do have questions about how the go-private idea will affect the stock options that form a significant part of their compensation .
Last week, the four astronauts on Space Exploration Technologies Corp. counts to bring them safely to and from the international space station, time in the headquarters of the company in Hawthorne, California, where they have their employees. Chief Operating Officer Gwynne Shotwell was the chairman of the event, where Musk was not present, at least while journalists were present.
Musk is also the founder of the infrastructure startup Boring Co. and Neuralink, which develops brain-machine interfaces to connect people and computers.
The task of the Tesla board has become increasingly complex this month. Just Tuesday, three directors announced that they had formed a special commission to evaluate the not yet seen details of Musk's go-private plan. The proposal seems unclear, with an analyst having the chance of less than 50 percent. The committee has yet to announce which bank they have held to act as financial advisor. An investigation by the Securities and Exchange Commission into Musk's tweet and other corporate statements is on the increase, with an already issued summons.
And unlike SpaceX, Tesla has no chief operating officer or clear no. 2. Musk told the New York Times that he does not intend to give up his dual role as chairman and CEO, but also said that "if you have someone who can do better, let me know. do the job better? They can now have the reins. "
The Tesla communications team – which in turn spoke on behalf of the company, the board and Musk itself – did not immediately comment on Times' story, the board's activities or that the company is actively looking for a COO. Tesla board members did not respond to various requests for comments; they often send questions from journalists to Tesla's communication team.
The board of directors is looking for higher talent but is not actively looking for a COO, a person who is familiar with the thinking of the board, said late Friday.
"The board of Tesla has to think long and deeply about their relationship with their CEO, because their own reputation is very much in danger, they are the last responsible party here, alongside the American government," said Charles Elson, director of John L. Weinberg Center for Corporate Governance at the University of Delaware. "The actions of recent weeks have led to a crisis of confidence in Musk's leadership, and the Tesla board is considered very close to Musk, but they have legal and ethical obligations towards shareholders alongside him."