Law firm finds that the conduct of former CEO did not mandate removal
10 March 2024 - 15:10
byAnna Tong and Shivansh Tiwary
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Bengaluru — OpenAI CEO Sam Altman will return to the ChatGPT-maker’s board along with three new directors, the world’s most prominent artificial intelligence company said on Friday.
An investigation by law firm WilmerHale into the events surrounding Altman’s November firing has concluded, and the company has created new governance rules and strengthened its conflict of interest policy. The board said it unanimously backed Altman’s leadership.
Employees, investors and OpenAI’s biggest financial backer, Microsoft, had expressed shock over Altman’s ouster, which was reversed within days.
OpenAI said on Friday it was appointing new directors including Altman, Sue Desmond-Hellmann, a former CEO of the Bill and Melinda Gates Foundation, Nicole Seligman, a former president of Sony Entertainment, and Fidji Simo, CEO of Instacart.
Altman welcomed the new board members in a post on X, adding, “We have important work in front of us.”
They will join board members Adam D’Angelo, CEO of Quora, former US treasury secretary Larry Summers and chair Bret Taylor, former co-CEO of Salesforce.
The investigation by WilmerHale found that Altman’s dismissal was not the result of concerns related to OpenAI’s finances, product safety or other issues.
“Instead it was a consequence of a breakdown in the relationship and loss of trust between the prior board and Mr Altman,” OpenAI said, describing the law firm’s findings.
“WilmerHale found that the prior board believed at the time that its actions would mitigate internal management challenges and did not anticipate that its actions would destabilise the company,” OpenAI said in a blog post.
“WilmerHale found that the prior board acted within its broad discretion to terminate Mr Altman, but also found that his conduct did not mandate removal,” it added.
OpenAI said it was adopting new corporate governance guidelines and creating a whistle-blower hotline. The start-up, whose CEO has been a prolific investor in other companies, also said it was strengthening its conflict-of-interest policy.
The board gave few details about those improvements.
The board’s lack of detail for its surprise November decision fuelled speculation about potential misconduct by Altman, which he and the company have denied, and about supposed existential risks from the technology that OpenAI is building.
Altman’s return as CEO about four days after his firing came after nearly all of OpenAI’s employees threatened to depart unless the board restored Altman and resigned.
His return led to discussions about how OpenAI would be governed, and the company announced a reconstituted board that did not include Altman and was helmed by Taylor.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
OpenAI board backs return of Sam Altman
Law firm finds that the conduct of former CEO did not mandate removal
Bengaluru — OpenAI CEO Sam Altman will return to the ChatGPT-maker’s board along with three new directors, the world’s most prominent artificial intelligence company said on Friday.
An investigation by law firm WilmerHale into the events surrounding Altman’s November firing has concluded, and the company has created new governance rules and strengthened its conflict of interest policy. The board said it unanimously backed Altman’s leadership.
Employees, investors and OpenAI’s biggest financial backer, Microsoft, had expressed shock over Altman’s ouster, which was reversed within days.
OpenAI said on Friday it was appointing new directors including Altman, Sue Desmond-Hellmann, a former CEO of the Bill and Melinda Gates Foundation, Nicole Seligman, a former president of Sony Entertainment, and Fidji Simo, CEO of Instacart.
Altman welcomed the new board members in a post on X, adding, “We have important work in front of us.”
They will join board members Adam D’Angelo, CEO of Quora, former US treasury secretary Larry Summers and chair Bret Taylor, former co-CEO of Salesforce.
The investigation by WilmerHale found that Altman’s dismissal was not the result of concerns related to OpenAI’s finances, product safety or other issues.
“Instead it was a consequence of a breakdown in the relationship and loss of trust between the prior board and Mr Altman,” OpenAI said, describing the law firm’s findings.
“WilmerHale found that the prior board believed at the time that its actions would mitigate internal management challenges and did not anticipate that its actions would destabilise the company,” OpenAI said in a blog post.
“WilmerHale found that the prior board acted within its broad discretion to terminate Mr Altman, but also found that his conduct did not mandate removal,” it added.
OpenAI said it was adopting new corporate governance guidelines and creating a whistle-blower hotline. The start-up, whose CEO has been a prolific investor in other companies, also said it was strengthening its conflict-of-interest policy.
The board gave few details about those improvements.
The board’s lack of detail for its surprise November decision fuelled speculation about potential misconduct by Altman, which he and the company have denied, and about supposed existential risks from the technology that OpenAI is building.
Altman’s return as CEO about four days after his firing came after nearly all of OpenAI’s employees threatened to depart unless the board restored Altman and resigned.
His return led to discussions about how OpenAI would be governed, and the company announced a reconstituted board that did not include Altman and was helmed by Taylor.
Reuters
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