Tesla Inc (NASDAQ:TSLA) is trending today after a number of pension funds including the California State Teachers’ Retirement System sent a letter to Tesla’s independent board member asking the company to install two additional directors who don’t have any connections with CEO/founder Elon Musk. As it stands, five of the six current board members of Tesla have either professional or personal relationships with Musk. The funds are also pushing for annual elections of board members, as opposed to the current staggered three years. Together the funds who sent the letter manage around $721 billion. The group said, ‘Directors should be held to a higher standard of independence given the conflicts of interest that permeate this board. A thoroughly independent board would provide a critical check on possible dysfunctional group dynamics, such as groupthink’.
With that being said, investors of Tesla Inc (NASDAQ:TSLA) have little to complain about at the moment. The market cap of Tesla eclipsed both Ford and GM this month, and many investors are long Tesla precisely because Elon Musk is at the helm. In the face of numerous obstacles, the company has executed rather well, and shares are up 44% year-to-date. There are still bears, however, who think that entering competition could hurt Tesla. With a more independent board, Tesla could potentially do better against its competition.
What Does The Smart Money Sentiment Say?
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According to long-only data, the smart money was a little more bullish in Q4 than in Q3. Of the 742 elite funds we track, 38 funds owned $1.19 billion of Tesla Inc (NASDAQ:TSLA) and accounted for 3.50% of the float on December 31, up from 34 funds and $1.01 billion on September 30.
The Bottom Line
Despite the recent rally, a few influential Tesla Inc (NASDAQ:TSLA) shareholders are pushing for a more independent board. For more reading, check out ‘10 Most Expensive Cars Ever Sold At Auction‘.
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