Elizabeth Warren says Tesla must meet its responsibilities to investors, including ensuring that Elon Musk’s tweets are not breaking the law.

Twitter was taken over by Elon Musk on October 27Jonathan Raa/Getty Images
Elizabeth Warren wrote that Tesla must ensure it meets its shareholders’ responsibilities. Elizabeth Warren, a Tesla shareholder, wrote that Tesla must ensure it meets its responsibilities to shareholders.

Tesla’s board must ensure that Tesla is fulfilling its fiduciary obligations to shareholders. This includes making sure Elon Musk’s tweets don’t violate the law, states Senator Elizabeth Warren.

Warren wrote to Robyn Denholm, Tesla Chairman, on Sunday that “one key element of these duties is that every Board member of a company that has multiple shareholders – especially public traded companies – is responsible in ensuring that a controlling shareholder (especially a Chief Executive Officer/CEO) does not treat it as a private gamething.”

Musk’s Twitter takeover has caused controversy and damaged Tesla’s brand. Many analysts believe that at least 60% of Tesla stock’s decline this year was due to Musk’s excessive focus on the social media platform. Particularly, Musk is being criticized for his bizarre tweets and political antics. He mocked gender pronouns and tweeted a picture of a Nazi soldier.

Warren stated that Twitter had welcomed hate speech under Mr. Musk’s leadership and made a greater use of racist language while pushing a wider platform for Nazism, virulent sexualism and climate misinformation. He also noted it could be a conflict of interest. The association between Tesla’s CEO, and the actions taken by Twitter could have an effect on Tesla’s brand and ability to market its cars to its target audience.

Warren said that Musk also directed Tesla resources towards Twitter, which could be considered inappropriate given that Twitter is privately owned by Musk. She cited Musk’s request for top SpaceX and Tesla employees to join Twitter soon after he had cut around 70% of Twitter’s workforce. Investors were also concerned by Musk’s decision to dump $40 billion worth of Tesla stock this fiscal year, primarily to finance his Twitter overhaul. This led to criticisms that he is using Tesla as an ATM machine to finance his project.

Warren enclosed a list with questions for Tesla’s Chairman in her letter. These include questions about any formal agreement between Tesla, Twitter and Tesla, as well as questions regarding Musk’s actions after his takeover.

Tesla investors have asked Musk to leave the social media company. Users voted for Musk to be the next CEO of Twitter in a poll that was conducted on the site. Musk promised to follow the results but later tweeted that no one wanted to be the CEO of Twitter, which caused Tesla stock to drop another 2% Tuesday.

Business Insider has the original article.
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By: jsor@insider.com (Jennifer Sor)
Title: Tesla must ensure it is meeting responsibilities to shareholders – and that includes making sure Elon Musk’s Twitter isn’t breaking the law, Elizabeth Warren says
Sourced From: markets.businessinsider.com/news/stocks/tesla-elon-musk-twitter-takeover-shareholders-elizabeth-warren-letter-board-2022-12
Published Date: Tue, 20 Dec 2022 17:23:03 +0000