Elon Musk, the CEO and public face of Tesla, is constantly making news and airing his views on the social networking site X. But the electric car company has another leader — one who keeps a much lower profile.
For more than five years, Tesla’s board of directors has been led by Robyn M. Denholm, a tech executive who rarely speaks publicly outside her native Australia and publishes almost nothing on X.
For some analysts and investors, Ms. Denholm is the “adult in the room” who helped Mr. Musk turn Tesla into the world’s most valuable automaker. But to her critics, she failed in her most important job: serving as a check on Mr. Musk.
Late last month, a Delaware judge sharply criticized Ms. Denholm’s leadership while striking down Mr. Musk’s 2018 compensation package, which is worth more than $50 billion. Ms. Denholm took a “deficient approach to oversight obligations” at Tesla, said Chancellor Kathaleen St. J. McCormick of the Delaware Court.
The judge also questioned whether Ms. Denholm could be independent of Mr. Musk because her work on Tesla’s board had earned her more than $280 million. In court last year, Ms Denholm described the pay as “life-changing”. Her compensation far exceeds what other major US companies such as Apple and Alphabet, the parent of Google, pay independent chairs on their boards.
“Musk is operating as if she has no board oversight,” the judge said in her ruling.
Mr. Musk has protested the decision and said he plans to ask shareholders to authorize Tesla to move its headquarters to Texas, where the company is based. The court ruling also means the board must create a new pay package for him.
Separately, Mr. Musk asked last month, two weeks before the Delaware ruling, that Tesla’s board significantly increase its control of the company if it wanted to continue developing AI-based products at Tesla. Mr. Musk, who owns about 13 percent of the company’s shares, wants voting rights equivalent to at least 25 percent of Tesla’s shares.
Ms. Denholm will be closely involved in any decision to relocate the company and in negotiations with Mr. Musk about his pay and desire for more control. He has said nothing publicly about these matters and did not respond to a request for an interview.
Ms. Denholm has spent over 40 years in operational and financial positions in major corporations in Australia and the United States. He is widely considered a calm, reserved presence with an appetite for occasional calculated risks. As CFO of Juniper Networks, for example, she resisted Wall Street pressure to cut costs and lay off employees, defending the company’s decision to invest in research and development. The strategy paid off, some analysts said.
“She’s very down-to-earth, very straightforward, very independent, very laid-back,” said Pierre Ferragu, managing director at New Street Research who covered Ms. Denholm at Juniper. “I don’t think you could find a better president for this very unique job” at Tesla.
Perhaps the biggest risk he has taken is agreeing to lead Tesla’s board.
Addressing an audience at a 2022 event in Sydney, Australia, Ms Denholm said she had friends who advised her against accepting Mr Musk’s offer after he agreed to step down as chairman in 2018 as part of a settlement with the Securities and Exchange Commission. The settlement came after Mr Musk claimed on Twitter that he had secured funding to take Tesla private, even though his plan to do so was in its infancy.
Her friends had warned her that she would be heading a company “with an opposing founder, and that at the time it was not profitable,” Ms. Denholm said, according to reports of the speech. She initially turned Mr. Musk down, according to legal filings, but he asked her again and she agreed and quit her job as chief financial officer at Telstra, an Australian telecommunications company.
One of three children of European immigrants to Australia, Ms Denholm, 60, grew up in suburban Sydney, where she attended what she described as a “garden-variety public school”. On weekends and school holidays, she helped her parents balance books and service cars at their gas station.
Ms Denholm studied economics at the University of Sydney and began her career at accounting firm Arthur Andersen. She had a series of jobs at major companies such as Toyota in Australia, where she was among the few female executives, and Sun Microsystems and Juniper in Silicon Valley.
In addition to her seat on Tesla’s board, Ms Denholm serves as chair of the Technology Council of Australia, the country’s highest-profile technology association. She owns at least three red Teslas and, in an interview with Sky News in 2014, described herself as “really weird”. Her family investment firm, which launched in 2021, focuses on women-led tech startups and owns 30% of the shares in her hometown’s two basketball teams – the Sydney Kings and the Sydney Flames.
Ms. Denholm did not know Mr. Musk before 2014, when a company board member hired her, according to legal filings. While he has praised Mr. Musk’s vision, discipline and resilience in interviews, he has mostly avoided discussing him or his outrageous X comments.
Conor Wynn, an expert on corporate decision-making at Monash University in Melbourne, Australia, said Mr Musk might have chosen Ms Denholm because she was so different from him and had skills he might not have.
“You don’t just want the mad genius at the top creating things,” Mr. Wynn said. “You need someone who can translate that into action, be people-centric and keep the business moving.”
But other experts said Ms. Denholm’s job was not just to fill in for Mr. Musk. As head of Tesla’s board, he has a duty to oversee the CEO and do what’s best for all of the company’s shareholders.
“When Denholm took over in 2018, we hoped she would be the adult in the room, possibly even a mother figure who could tame this wild child,” said Jo-Ellen Pozner, associate professor of management at the Leavey School of Business in Santa Clara University. “That obviously didn’t happen.”
But, Ms. Posner said, Ms. Denholm may not have been able to manage Mr. Musk because nearly all of Tesla’s other executives have personal or financial ties to him. One board member is Mr. Musk’s brother, Kimbal. Several others have been close to Mr. Musk personally, professionally, or both for many years.
“It doesn’t look like she was set up for success in reining in Elon Musk,” Ms. Posner said.
Ms Denholm’s job is likely to get tougher this year than it has been. In addition to looming decisions about the company’s foundation and Mr. Musk’s demand for greater control, Tesla’s stock is down about 24 percent this year as investors worry about slowing sales and falling profits.
At a conference last year, Ms Denholm described how she dealt with uncertainty and doubt. Early in her career, faced with concerns about a looming international move, Ms. Denholm said, she called her father for advice.
He said: “Robin, what’s the worst thing that could happen? Do you screw up and have to go home?’ he told an audience in Sydney in May. “I’ve taken that approach.”
