Tesla announced two new additions to its Board of Directors before closing out the new year. The founder and Executive Chairman of Oracle, Larry Ellison and Walgreens Boots Alliance Global Head of Human Resources Kathleen Wilson-Thompson will be joining the board as independent directors, effective from December 27, 2018.
These additions come as part of Tesla CEO Elon Musk’s deal with the US SEC. Musk’s recent tweets about the SEC have affected the company’s stock price, and his statements about getting “anything done” that he wants as the majority shareholder, have already undermined the authority of new board chairman Robyn Denholm. Musk accepted a no-guilt settlement that forced him to resign as Tesla’s board chairman, pay a $20 million fine and be subject to any communications protocols that the Tesla board implements to control what he says to the public about the company.
After this, Tesla’s investors called for a stronger board oversight of Musk. Tesla agreed to add the two independent directors on the board to help rein Musk in and have the board committee control Musk’s communications about the company.
Ellison is an experienced executive with ample experience in startups, one of the world’s richest men and a Tesla investor to boot, having purchased 3 million shares in the company earlier this year. Also known as an entrepreneurial maverick, he cofounded Oracle in 1977 as an enterprise software company. By 1992 the company was the market leader in database management.
However, speculations now arise that Ellison’s association with the company may extend beyond the board. It seems that apart from professional guidance, software and data will likely support everything from advertising to manufacturing in an effort to reduce the time from production to customer deliver to 10 days.
“This will bring about a drastic reduction in inventory and amazingly fast cash conversion,” wrote Trip Chowdhry, Managing Director at Global Equities Research, in a research note published on Friday. “This should bring Tesla to the landmark old DELL model of negative operating working capital.”
It will be interesting to see how the relationship between Tesla and Oracle develop in 2019, from software to voice search in the cars tied to databases in cloud computing.
Tesla’s Board of Directors now consists of 11 members, including Kimbal Musk, Linda Johnson Rice, Robyn Denholm and Steve Jurvetson. Now, with the new appointments, the board is comprised of 8 men and 3 women.