Tesla shareholders shot down a proposal to remove Elon Musk as the chairman of Tesla's board of directors
- Tesla shareholders voted to keep CEO Elon Musk as the chairman of the company's board of directors on Tuesday.
- A shareholder had proposed that the company replace Musk, who has served as the chairman of Tesla's board of directors since 2004 and its CEO since 2008, with an independent chairman.
- Tesla's board of directors did not support the proposal and said Musk's role as the company's chairman has been essential to Tesla's success so far and will allow the company to quickly adapt to new challenges.
Tesla shareholders voted to keep CEO Elon Musk as the chairman of the company's board of directors on Tuesday.
The results of the vote were announced at Tesla's annual shareholder meeting, which was held in Mountain View, California.
A Tesla shareholder proposed the vote, which was outlined in a report the company filed with the Securities and Exchange Commission on April 26. The shareholder proposed that the company replace Musk, who has served as the chairman of the Tesla's board of directors since 2004 and its CEO since 2008, with an independent chairman.
"Although the current leadership structure, in which the positions of Chairman and CEO are held by one person, could provide an effective leadership for Tesla at the early stage, now in this much more highly competitive and rapidly changing technology industry, it is more and more difficult to oversee Tesla's business and senior management (especially to minimize any potential conflicts) that may result from combining the positions of CEO and Chairman," the proposal reads.
Tesla's board of directors did not support the proposal and said Musk's role as the company's chairman has been essential to Tesla's success so far and will allow the company to quickly adapt to new challenges.
"The Board believes that the Company's success to date would not have been possible if the Board was led by another director," the board said. "The Board believes that it is precisely during times when a company must quickly adapt to constant change and outside pressures that Board leadership needs to be lockstep with the Company's operations."
Tesla has faced a number of challenges this year, including questions about its financial health, a missed production target for its Model 3 sedan, and concerns about working conditions at the California factory where it assembles its cars.