San Francisco/New York: In choosing Robyn Denholm to keep Elon Musk in check, Tesla Inc. picked a numbers-first executive who climbed the ranks of tech companies. Those who know her say her no-nonsense ways may be exactly what the mercurial CEO needs to get out of his own way.
“Everything about her is rational, reasonable, and warm. I’m not surprised she got the job," Scott McNealy, the co-founder and former chairman of Sun Microsystems Inc., said in a phone interview. “If Elon listens to her, he’ll be way more successful."
As Tesla’s chairman, Denholm, 55, will be responsible for the tall tasks of reining in the celebrity CEO Musk and guiding an electric-car maker that’s still in a phase of costly expansion and vulnerable to financial setbacks. While Tesla just celebrated a blowout quarter in which it posted a rare profit, many analysts and investors suspect that further capital increases could be needed before the company is on firm footing.
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Leading the charge to step up oversight of Musk could be particularly tricky. Tesla’s board, which Denholm has been on since 2014, didn’t prove to be effective in controlling some of his worst impulses this summer. Her ascendancy to the role of chairman was precipitated by Musk’s run-in with the U.S. Securities and Exchange Commission over his problematic take-private tweets.
Denholm began her career at audit and accounting services at Arthur Andersen, and left the firm for a position in the finance department of Toyota Motor Corp.’s Australian subsidiary. She joined Sun in 1996 and was there for 11 years, including a position in the pioneering computer company’s top leadership group. She declined to be interviewed.
Musk, 47, is a classic Silicon Valley founder type, an eccentric visionary who is very much focused on products. The chairmen that oversee them often have been CEOs themselves, or led companies in other strategic roles. A chairman with a finance background isn’t as common — though in Tesla’s case that actually could be a strength: rapport with the financial community is precisely what the carmaker is seeking to improve.
“She seems to be supremely competent in financial communications," said Jeffrey Sonnenfeld, an expert on leadership who teaches at the Yale School of Management. “Of the likely choices, I think they made the best pick. Her strengths are not his and vice versa."
Still, some see Denholm as being too close to Musk. A settlement reached with the SEC in September stipulated that Tesla strengthen a board long criticized for being too closely aligned with its billionaire leader.
Denholm “provides a potential spark for change," Loup Ventures’ Gene Munster said in a note. But Tesla needs to follow through with other actions, including turning over half of the board to bring in directors with manufacturing experience, he said.
After Sun, Denholm worked at network-equipment maker Juniper Networks Inc., where she was an executive vice president and chief of finance and operations. Her technology background is an asset: Tesla’s cars constantly receive new features via over-the-air software updates, and the company’s batteries are increasingly being sold to utility companies. Denholm also served on the board of ABB Ltd., the Swedish-Swiss multinational that works closely with utilities.
“Robyn is very smart, tough-minded and ethical," said William F. Meehan, a lecturer in strategic management at the Stanford Graduate School of Business who was a director of Juniper while she worked there.
Denholm joined Telstra, Australia’s largest phone company, in January 2017 as chief of operations and took on the role of CFO on October 1. Her decision to step down from the CFO role so quickly surprised many; just last month, she told Australian media through a spokesperson that she wasn’t in contention for the Tesla chairman’s job. Denholm, who is married and has adult children, lives in Sydney, and it’s not clear if she will move back to California for the chairman job.
“Robyn is fearless but very practical. If she believes in something she fights for it -- she’s not a pushover,’ said Joe Pollard, the former chief marketing officer of Telstra, in an interview. “She is always focused on ‘how are we going to fix this problem.’ Nothing is ever left unsaid and she will always speak up for customers, the business and employees.’
Like Silicon Valley, the business world in Australia has a long way to go in terms of gender equality, and Denholm is passionate about getting more women into science, technology and engineering, establishing a scholarship in her name at the University of New South Wales.
“She’s not part of the bro culture, and yet is not someone naïve parachuting in from the outside," Yale’s Sonnenfeld said. “It’s a rare ray of good governance news."
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