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

• From charges of fraud to allegations of misconduct, Elon Musk is no stranger to scandal.
• Nevertheless he maintains footing at the helm of four firms worth billions of dollars combined.
• Musk’s capability to bounce back is a consequence of his cultlike fandom and leadership model, authorities said.

From charges of company fraud and allegations of personal 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 Unexciting Company is working with a potential $1 billion penalty for strolling absent from a $44 billion bid to obtain Twitter allegations of an affair with Nicole Shanahan, the wife of Sergey Brin, Musk’s longtime good friend and a Google cofounder and information that he secretly fathered twins with Shivon Zilis, a Neuralink government — and which is just in just the previous 30 times.

It can be strange for a CEO shrouded in so much scandal, controversy, and alleged misconduct to retain footing at the helm of 4 companies with a merged valuation in the billions. Duncan Levin, a prison protection lawyer who represents controversial shoppers, these types of as Harvey Weinstein, Clare Bronfman, and Anna Delvey, instructed Insider: “No just one is scandal-proof. Though, definitely, Elon Musk is considerably insulated from fallout considering that he runs his very own firm.”

For illustration, Musk has been accused of fostering a harmful society of racism and sexism at the firms he runs. In June, 15 former and existing Black workers at Tesla submitted a lawsuit versus the electric powered-car maker, alleging racial discrimination. In 2018, SpaceX — the aerospace corporation founded by Musk — paid a flight attendant $250,000 to settle a sexual-misconduct declare towards the CEO. Inspite of his antics, Musk remains mostly unscathed professionally. 

What is actually additional, the tech billionaire’s personalized lifetime generates the variety of tabloid frenzy generally reserved for Hollywood A-listers, and his expert stunts go away certain shares reeling.

Musk’s capability to bounce back again from repercussions is the final result of a complicated interplay of a fierce, cultlike fandom and his transformational management design and style, authorities explained to Insider. 

Transformational leadership 

Musk’s transformational design and style of management is the matter of substantial investigation, investigation, and situation scientific studies. “He’s this sort of an unpredictable character, and no one actually is familiar with which way he is going to flip, which makes him these an appealing chief to adhere to,” explained Jay Baer, the founder of the advertising and marketing-consultancy startup Convince & Change, an advisory organization with clientele these types of as 3M, Oracle, Cisco, and Nike.

Musk’s improvements in house travel and clean up strength make him an legendary figure between electrical-auto fanatics, house fans, and tech geeks. “I consider he’s a deeply flawed, intriguing particular person,” claimed Tom Goodwin, a cofounder of the small business-consultancy startup All We Have Is Now and the host of “The Edge,” a organization, tech, and lifestyle video sequence on Euronews. “Everything that Musk represents is about hard traditional means of accomplishing enterprise.” 

Chad Anderson, the CEO of the house-tech VC fund Place Angels Community, was an early trader in SpaceX and informed Insider that whilst Musk is not with no flaws, he has the type of “vision and serious chops” that tends to make the not possible attainable.

What’s a lot more, he is highly smart and in advance of most individuals, a previous supervisor at Tesla beforehand instructed Insider. “You have to believe 10 situations a lot more audacious than he does to be ready to be successful,” the staff claimed. 

Icon status 

The controversies Musk faces, the stress he builds, the avid base of followers and allies, and the escalating amount of enemies only incorporate to his legend, Goodwin claimed. “The chronicling of road blocks becoming defeat and the rallying of others behind a shared purpose are creating energy and fueling the narrative.”

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

“Musk is Teflon in the identical way that Trump is Teflon,” Baer reported. He recalled when Trump stated he could shoot someone on 5th Avenue and “not drop any voters.” Soon after that remark in 2016, he went on to be elected president. Musk has the very same halo, he extra.

“They are the motion they have created,” mentioned Baer, incorporating that without the need of Trump, there would be no MAGA, and that devoid of Musk, the attract of his companies would be diminished.

This is vastly distinct from most other CEOs, who are relatively interchangeable mercenaries or founders who typically will not have the voting shares or board management to give themselves scandal immunity, Baer said.  

For illustration, it can be not unheard of for CEOs to be requested to phase down in gentle of allegations of personalized improprieties. Stories stated that Monthly bill Gates still left Microsoft’s board amid an investigation into an alleged affair with an worker, while Brian Krzanich, Intel’s CEO, resigned immediately after what the tech agency explained as a previous consensual partnership with a middle manager.

“Musk’s and Trump’s several ethical shortcomings make them far more powerful,” Baer stated. “They are both equally ‘morality mavericks,’ and that operates for them, not from them.”