Uber’s board is all set to limit the influence of its former CEO Travis Kalanick through a vote during an upcoming board meeting.
This decision has stemmed as a result of behind-the-scenes drama at Uber’s boardroom.
During his tenure as a CEO, Kalanick was given the control of three seats in the board.
It’s been a month since the appointment of Uber’s new CEO Dara Khosrowshahi. In his efforts to bring Uber back in line, he proposed reducing the influence of Kalanick to the board members. This move would also give Khosrowshahi the required power he needs to run the operations in Uber smoothly. Also, the Japanese investor SoftBank agreed to invest $10 billion on the condition that Kalanick will not return to his old position.
However, Kalanick after getting a whiff of this move appointed two new board members: Ursula Burns, the former chief executive of Xerox, and John Thain, the former chief of Merrill Lynch. With this move, all eleven seats on the board have been filled.
In response to this move, Khosrowshahi drafted an internal memo to the staff. The excerpts of this letter read:
“I wanted to update you on some disappointing news from today. Travis appointed two new members to Uber’s board without discussing it with me or the board of directors more broadly. Anyone would tell you that this is highly unusual.
If your family or friends ask you about it, here is our press statement:
The appointments of Ms. Burns and Mr. Thain to Uber’s Board of Directors came as a complete surprise to Uber and its Board. That is precisely why we are working to put in place world-class governance to ensure that we are building a company every employee and shareholder can be proud of.”
Uber’s top investors Shervin Pishevar and Steve Russell are threatening to sue three board members if they vote in favor of eliminating the super voting powers of the company’s board of directors.
This means that CEO Dara Khosrowshahi will have to use all his tactical knowledge and power to get the situation right, or Uber will be hit with another lawsuit.