Elon Musk’s Controversies and Why He’s Still CEO of 4 Firms

ByGeraldine R. Pleasant

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  • From costs of fraud to allegations of misconduct, Elon Musk is no stranger to scandal.
  • Nevertheless he maintains footing at the helm of four providers worthy of billions of dollars put together.
  • Musk’s means to bounce back again is a consequence of his cultlike fandom and leadership style, specialists explained.

From fees of company fraud and allegations of individual misconduct to a general public archive of provocative Twitter rants, Elon Musk is no stranger to scandal.

The CEO of Tesla, SpaceX, Neuralink, and The Boring Enterprise is working with a potential $1 billion penalty for walking absent from a $44 billion bid to obtain Twitter allegations of an affair with Nicole Shanahan, the spouse of Sergey Brin, Musk’s longtime close friend and a Google cofounder and news that he secretly fathered twins with Shivon Zilis, a Neuralink government — and which is just in just the earlier 30 times.

It truly is strange for a CEO shrouded in so substantially scandal, controversy, and alleged misconduct to keep footing at the helm of four businesses with a put together valuation in the billions. Duncan Levin, a felony protection attorney who represents controversial shoppers, these types of as Harvey Weinstein, Clare Bronfman, and Anna Delvey, informed Insider: “No 1 is scandal-proof. Even though, obviously, Elon Musk is somewhat insulated from fallout given that he operates his very own enterprise.”

For instance, Musk has been accused of fostering a poisonous tradition of racism and sexism at the organizations he operates. In June, 15 previous and recent Black workforce at Tesla filed a lawsuit towards the electrical-motor vehicle maker, alleging racial discrimination. In 2018, SpaceX — the aerospace business started by Musk — compensated a flight attendant $250,000 to settle a sexual-misconduct declare in opposition to the CEO. Irrespective of his antics, Musk continues to be largely unscathed professionally. 

What is actually more, the tech billionaire’s private daily life generates the type of tabloid frenzy normally reserved for Hollywood A-listers, and his experienced stunts go away selected shares reeling.

Musk’s ability to bounce back from repercussions is the consequence of a complex interaction of a fierce, cultlike fandom and his transformational leadership model, experts advised Insider. 

Transformational leadership 

Musk’s transformational design of leadership is the subject of significant investigation, investigate, and circumstance reports. “He is these an unpredictable character, and nobody actually appreciates which way he is heading to switch, which tends to make him these an interesting chief to adhere to,” explained Jay Baer, the founder of the promoting-consultancy startup Encourage & Change, an advisory organization with consumers this kind of as 3M, Oracle, Cisco, and Nike.

Musk’s improvements in place travel and cleanse vitality make him an iconic figure among the electric powered-auto fans, space enthusiasts, and tech geeks. “I believe he is a deeply flawed, intriguing person,” stated Tom Goodwin, a cofounder of the enterprise-consultancy startup All We Have Is Now and the host of “The Edge,” a organization, tech, and lifestyle movie sequence on Euronews. “Everything that Musk represents is about complicated regular ways of doing small business.” 

Chad Anderson, the CEO of the space-tech VC fund Space Angels Network, was an early investor in SpaceX and told Insider that though Musk is not with out flaws, he has the sort of “vision and actual chops” that helps make the unachievable probable.

What’s additional, he’s very smart and ahead of most folks, a previous supervisor at Tesla beforehand informed Insider. “You have to feel 10 situations additional audacious than he does to be able to be profitable,” the personnel reported. 

Icon status 

The controversies Musk faces, the rigidity he builds, the avid foundation of lovers and allies, and the escalating amount of enemies only incorporate to his legend, Goodwin stated. “The chronicling of road blocks being prevail over and the rallying of others at the rear of a shared target are creating electricity and fueling the narrative.”

What is far more, Musk’s unflappability is equivalent to the phenomenon that brought Trump’s ascendance.

“Musk is Teflon in the similar way that Trump is Teflon,” Baer mentioned. He recalled when Trump reported he could shoot an individual on 5th Avenue and “not eliminate any voters.” Immediately after that remark in 2016, he went on to be elected president. Musk has the very same halo, he added.

“They are the movement they’ve created,” reported Baer, adding that with out Trump, there would be no MAGA, and that without the need of Musk, the allure of his providers would be diminished.

This is vastly distinct from most other CEOs, who are rather interchangeable mercenaries or founders who ordinarily do not have the voting shares or board handle to give themselves scandal immunity, Baer reported.  

For instance, it’s not unusual for CEOs to be questioned to stage down in gentle of allegations of personalized improprieties. Reports explained that Monthly bill Gates remaining Microsoft’s board amid an investigation into an alleged affair with an employee, although Brian Krzanich, Intel’s CEO, resigned soon after what the tech organization described as a earlier consensual partnership with a middle manager.

“Musk’s and Trump’s quite a few moral shortcomings make them additional powerful,” Baer reported. “They are each ‘morality mavericks,’ and that works for them, not versus them.”