New chairman might be right fit for Tesla
Denholm must rein in Musk in addition to guiding company
In picking Robyn Denholm to keep Elon Musk in check, Tesla Inc.’s board went with a numbersfirst executive who climbed the ranks of multinationals’ finance departments. Those who know her say her no-nonsense methods may be exactly what Tesla needs.
“Everything about her is rational, reasonable and warm. I’m not surprised she got the job,” said Scott McNealy, the co-founder and former chairman of Sun Microsystems. “If Elon listens to her, he’ll be way more successful.”
As Tesla’s chairman, Denholm, 55, will be responsible for holding back celebrity CEO Musk while guiding an electric car maker that’s still in a volume expansion phase and vulnerable to financial setbacks. While Tesla just celebrated a blowout quarter — posting a rare profit — many analysts expect that further capital increases are needed before the company is on firm footing.
Denholm began her career at audit and accounting services at Arthur Andersen and left the company for a position in the finance department of Toyota’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 who 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 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 Tesla independent director since 2014, she was part of a board that failed to prevent the CEO’s erratic actions this year, including his problematic August tweets about trying to take the company private. A settlement with the Securities and Exchange Commission over the matter stipulated that Tesla should 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 the board to bring in directors with manufacturing experience, he said.
After Sun, Denholm worked at network equipment maker Juniper Networks, 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-theair software updates, and the company’s batteries are increasingly being sold to utility companies. Denholm also served on the board of ABB Ltd., a SwedishSwiss multinational that works closely with utilities.
“Robyn is very smart, toughminded and ethical,” said William 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 chief financial officer Oct. 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 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, former chief marketing officer of Telstra. “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.”