Tesla Recharges Board Diversity With New Director
By CultureBanx Team
Tesla named Kathleen Wilson-Thompson to its board of directors
Only 3 black CEOs are leading Fortune 500 companies
Electric car maker Tesla (TSLA -12.97%) recently announced it added two new board members, Walgreens (WBA +0.61%) human resources executive Kathleen Wilson-Thompson and tech icon Larry Ellison. This is all part of the company’s plan to complete its obligations from the $20 million SEC settlement last fall. Can Wilson address what many Tesla employees have described as a harsh working culture?
Why This Matters: As production of Tesla’s Model 3 ramped up so did allegations of unfair and unsafe working conditions. Kathleen will need to tap into her decades worth of leadership experience in HR to help Tesla with their internal strife. She can also use her “passion for sustainable energy,” along with the wealth of knowledge that comes from serving on two other public U.S.-based manufacturing companies boards to help mend the electric car maker.
Tesla is following the trend for diversification in corporate America that’s more pronounced than ever before. There’s research showing the many benefits of diversity in thought among corporate leadership. McKinsey and MSCI found companies with higher levels of diversity at the board level, are more likely to have strong financial performance and fewer instances of poor corporate governance.
A concerning development is there isn’t a consensus across boardrooms on the value-add of diversity. A PwC survey of 900 board directors found 24% of directors don’t believe racial diversity has an impact on diversity of thought within boardrooms.
Situational Awareness: J.P. Morgan (JPM +1.62%), AirBnB, Uber, Netflix (NFLX -3.99%), and Etsy (ETSY +2.27%) all added African-American executives to their boards in Q1 of 2018. Ken Chenault, Ursula Burns, Mellody Hobson, Susan Rice, and Edith Cooper all joined the respective boards of these companies. However, there are still too few African-Americans at the top of U.S. corporations, only three black CEOs are leading Fortune 500 companies.
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