Brief: Uber’s new CEO calls Travis Kalanick’s move behind his back ‘disappointing’

Uber co-founder Travis Kalanick. Photo credit: TechCrunch

The news (extracted from Recode):

• Uber’s new CEO Dara Khosrowshahi has written a letter to staff in which he expresses “disappointment” over Travis Kalanick’s appointment of two board members behind his back. His predecessor appointed former Xerox CEO Ursula Burns and former Merrill Lynch CEO John Thain as directors to the Uber board without discussing it with Khosrowshahi or the board.
• Khosrowshahi says in his letter: “Team – I wanted to update you on some disappointing news from today. Travis appointed two new members to Uber’s Board without discussing it with me or the Board of Directors more broadly. Anyone would tell you that this is highly unusual.”
• Uber’s press statement reads: “The appointments of Ms. Burns and Mr. Thain to Uber’s Board of Directors came as a complete surprise to Uber and its Board. That is precisely why we are working to put in place world-class governance.”

Why it matters:

• The ouster of Travis Kalanick, who is on indefinite leave, and appointment of Expedia CEO Dara Khosrowshahi to take over from him was aimed at improving the corporate culture at Uber which has been reeling under a series of scandals.
• Uber is under scrutiny for sexual misconduct and trade secret theft charges. The latest is a probe into whether it violated US federal laws against bribery overseas.
• The “unusual” mode of appointment of two new board directors will raise questions on who’s calling the shots at Uber – Kalanick or Khosrowshahi – and whether the company can regain its focus on its ride-hailing business, with rivals like Didi, Grab, and Ola getting stronger.