Tesla is ‘better run’ after leadership tumult, says top investor

Asset manager ‘more comfortable’ with $9.7 billion stake following carmaker’s overhaul

Tesla has overhauled its board in recent years, stripping Elon Musk of his chairman role, cutting the number of board seats and hiring independent directors. Photographer: Qilai Shen/Bloomberg

Tesla has overhauled its board in recent years, stripping Elon Musk of his chairman role, cutting the number of board seats and hiring independent directors. Photographer: Qilai Shen/Bloomberg

 

Tesla is a “better-run” company after its regulatory battles following the recent addition of independent directors to oversee Elon Musk, according to the electric carmaker’s top external shareholder.

“We thought he was getting things wrong,” said James Anderson, head of global equities for Baillie Gifford, speaking about Mr Musk, Tesla’s founder. “I feel more comfortable now.”

The electric carmaker has overhauled its board in recent years, stripping Mr Musk of his chairman role, cutting the number of board seats and hiring independent directors including Larry Ellison, the Oracle founder, and James Murdoch, the media scion.

The bulk of the changes came after a 2018 settlement with the US securities regulator over Mr Musk’s false claim that he had secured funding to take the firm private. Prior to the lawsuit, Glass Lewis, the proxy adviser, and CtW Investment Group, which works with pensions, had also criticised the company for stacking the board with directors who had close ties to Mr Musk.

Mr Anderson said the appointment of Robyn Denholm, one of the company’s independent board members since 2014, as chairwoman was a decisive move. She had given the founder “emotional” support and allowed him to focus on leading the company, he said.

Ms Denholm left a senior role at Telstra, the Australian telecoms company, last year to focus on Tesla full time and is one of few board members with automotive experience. – Copyright The Financial Times Limited 2020