Tesla’s board should suspend Elon Musk for endorsing anti-Semitic views on social media, according to an investor in the electric car company and a leading management expert.
Jerry Braakman, president of First American Trust, wants Tesla’s board to send a clear message that Musk went too far last week by agreeing with an anti-Semitic post on X (formerly known as Twitter) that claimed Jewish communities were promoting “hate against whites”.
“I believe in free speech, but there’s no excuse for a CEO of a public company to spread hate,” Braakman said in a statement.
On Friday, Disney, NBCUniversal, CNN owner Warner Bros. Discovery and other major brands stopped advertising on X, which is owned by Musk. The companies did not specifically say it was related to Musk’s post, but some of their ads were found to be placed near anti-Semitic posts on X, according to a report by Media Matters.
Tesla’s board should put Musk on leave for 30 to 60 days and require him to undergo empathy training and/or therapy, Braakman argued.
“Neither his wealth nor his technical and business skills excuse his comments. It seems to have only reinforced the demons he carries. And it cries out that he needs help,” Braakman said.
Jeffrey Sonnenfeld, dean of leadership studies at the Yale School of Management, agrees that Tesla’s board should hold Musk accountable.
“The board has a responsibility to act. He should not be able to use the title of chief executive officer. That should be suspended immediately,” Sonnenfeld told CNN on Monday.
The Yale professor said if Musk served as chief technology officer instead of CEO, the impact on the share price should not be significant.
Neither Tesla nor its chairwoman, Robyn Denholm, responded to requests for comment.
Who sits on Tesla’s board?
Naturally, Musk wields enormous power at Tesla, which he co-founded.
Not only is Musk considered the single most important person at Tesla, but he also sits on the board of directors and is the largest individual shareholder. Musk held 411 million shares at the end of March, representing a stake of around 13% and a current value of around $96 billion.
By contrast, Santa Ana, California-based First American held a relatively small stake of 16,000 shares at the end of September.
Tesla’s board is chaired by Denholm and includes James Murdoch, venture capitalist Ira Ehrenpreis, Musk’s younger brother Kimbal and Musk himself.
“Only his board can hold him accountable. And he has a lot of friends on it,” Braakman said.
‘No confidence’ in board
Nell Minow, a Tesla shareholder and vice chairman of ValueEdge Advisors, which advises institutional investors on corporate governance, said Tesla’s board should hire a firm to assess the impact of Musk’s “terrible behaviour” on the car company’s brand.
“I was thinking about buying a Tesla, but that’s off the table now. I just don’t want to support him,” Minow told CNN.
Minow said she had “no confidence whatsoever” in the willingness of Tesla’s board to provide meaningful oversight of Musk.
“The board has every reason to replace him as CEO. But do they have the ability to do it? Do they have the courage to do it? The answer is no,” Minow told CNN. “As a Jewish person, I am as concerned about his instability as I am about his anti-Semitism.”
Another shareholder, Ross Gerber, CEO and president of Gerber Kawasaki, told CNBC late last week that Musk’s behaviour was “absolutely outrageous” and “destroying the brand”.
“I’ve just never had this with any company I’ve ever invested in, ever in my life,” Gerber said.
Some prominent business leaders are standing by Musk.
Hedge fund billionaire Bill Ackman, who has been critical of how Harvard and other universities have handled anti-Semitism on campus, said over the weekend that Musk was “not an anti-Semite”.
“It’s remarkable how quickly the world is ready to attack Musk for his shoot-from-the-hip commentary,” Ackman said in a post on X. “Musk is not perfect, but the world is a much better place because of him.”
