An investor group called on Tesla Motors on Tuesday to add two independent directors to its board and separate the roles of chairman and chief executive, as it highlighted founder and CEO Elon Musk's dominance of the board in the wake of Tesla's proposed bid for SolarCity.
Musk is also the chairman and largest shareholder of SolarCity.
CtW Investment Group, which works with union-based pension funds and holds 200,000 shares of Tesla, in a letter to Silicon Valley-based Tesla, demanded the implementation of five steps it said would remedy Tesla's "underlying governance deficiencies."
In addition to adding two permanent independent directors and separating the chairman and CEO roles, CtW called for two independent directors to form a special committee to review the proposed SolarCity deal; a declassification of the board so that stockholders may have an annual say on the election of all directors; and revision of the corporate governance guidelines to forbid that immediate family members of board members serve concurrently on the board.
Telsa board member Kimbal Musk, who is CEO of Medium, an internet software company based in Boulder, Colorado, is the brother of Elon Musk.
Tesla last week proposed an up to $2.8 billion all-stock acquisition of U.S. solar installer Solar City.