Tesla Inc TSLA shares ticked higher Friday morning after naming Oracle Corporation ORCL co-founder Larry Ellison and Walgreens Boots Alliance Inc WBA executive Kathleen Wilson-Thompson to its board.
What Happened
As part of its settlement with the Securities and Exchange Commission over CEO Elon Musk’s misleading take-private tweets, Tesla appointed two new independent directors right on the regulator’s 90-day deadline.
This was the second compositional change Tesla has made to comply with SEC terms. Last month, it appointed Robyn Denholm to succeed Musk as chair.
The additions, which expand Tesla’s board size from nine to 11, also move the firm into compliance with recent California laws mandating public companies to include at least three women on their boards.
Tesla shares traded around $323.50 at time of publication, up 2.4 percent for the day.
Why It’s Important
The strategic appointments fill critical gaps in Tesla’s management. Wilson-Thompson, Walgreen’s global chief human resources officer, brings experience lost with the departure of Tesla’s top HR manager earlier this year. Ellison, a large stakeholder in the company, brings business expertise from his thriving Oracle.
"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," Tesla's original board said in a statement. “In Larry and Kathleen, we have added a preeminent entrepreneur and a human resources leader, both of whom have a passion for sustainable energy.”
The pair also somewhat distances the board from Musk’s pocket. Historically, the body has been comprised of leaders close to the CEO, including brother Kimbal Musk. While Ellison considers himself a close friend of Musk’s and a long-time believer in the vision, Wilson-Thompson is seen to be more independent.
The SEC settlement with Tesla included establishment of a board committee and employment of a securities lawyer to oversee Musk’s social media posts relevant to the firm. This and other requisite steps will also take effect Friday.
Related Links:
The Street Weighs In On Musk's SEC Settlement As Tesla Shares Rip Higher
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
