Sen Elizabeth Warren of Massachusetts wrote to Tesla’s board chair on Sunday to express her concern that CEO Elon Musk has failed to meet his responsibilities to the company since completing his purchase of the social media platform Twitter less than two months ago.
In her letter to Robyn Denholm, Ms Warren wrote that she is concerned that Tesla’s board “has failed to meet its legal duty” to ensure that Mr Musk is acting in the best interests of the publicly-traded company and is wondering how the board is dealing with questions around Mr Musks’ “conflicts of interest, misappropriation of corporate assets, and other actions by Mr. Musk that appear not to be in the best interests of Tesla and its shareholders.”
Mr Musk has remained in charge of Tesla in the aftermath of his purchase of Twitter, which left him responsible for $13bn in debt.
As Mr Musk has devoted more of his time and energy to running Twitter in recent weeks, Tesla has felt the impact. Tesla stock has plummeted since Mr Musk’s takeover of the social media platform, but rebounded on Sunday night and Monday morning. The latter coincided with Mr Musk saying that he would abide by the results of a Twitter poll that showed users want him to step down as head of the company.
It’s not just on the stock market where Mr Musk’s investment in Twitter has directly impacted his other companies. CNBC reported earlier this month that executives at Tesla, Boring Co, and SpaceX have authorised to help with the management of the social media platform.
Ms Warren noted that Mr Musk reportedly pulled more than 50 employees from Tesla, including the chief information officer, over to Twitter in a bid to help him reform the company’s corporate structure.
“This use of Tesla employees raises obvious questions about whether Mr. Musk is appropriating resources from a publicly traded firm, Tesla, to benefit his own private company, Twitter,” Ms Warren wrote in her letter.
Ms Warren also voiced concerns that Mr Musk could use Twitter to supress criticism of Tesla and boost the company’s profile — or, if he is desperate for advertising revenue, cut deals with Tesla’s rivals to increase his own wealth. She also raised the possibility that Tesla might be damaged by Mr Musk’s management of Twitter, which has seen the volume of hate speech on the website increase significantly and prominent journalists banned.
Ms Warren, a progressive Democrat who favours increasing taxes on the ultra-wealthy to bolster the country’s social programmes, has clashed with Mr Musk in the past. Her letter asks Ms Denholm to respond by January 3 with an outline of how the board plans to oversee Mr Musk going forward.
