TCS taking to Twitter, asking people to decide whether he should go for a buyback or issue bonus shares
Or, Bennett Coleman taking to social media, asking people to vote whether or not to public
Or, Mukesh Ambani decides to ask people to make a decision for him via Twitter – should he move to London or not?
Get the gist of it? Major, important corporate decisions being put up by CEOs on their Twitter, asking people to vote; based on the majority, the decision will be taken. No need for any financial consultant or informing the stock exchanges or even the shareholders!
That’s precisely what Elon Musk did – he asked his 62.8 million Twitter followers over the weekend whether he should sell $21bn worth of shares in the electric car company in order to pay tax. Tweeting he would “abide by the results of this poll, whichever way it goes”, 58% of those who responded said “yes”, he should sell the shares.
Musk proposed selling 10% of his Tesla shares in order to generate enough money to pay a proposed “billionaires tax” on “unrealised capital gains”. This ‘billionaires tax’ is being proposed on the annual increase in the value of stocks and shares they own – tax on the notional profit on share value, not on profits actually realized on share sale.
Musk, naturally has been a vocal opposer of this tax and this response from his followers, means he has to do what he now does not want to do. It wasn’t immediately clear what that proposed sale would amount to. As of last December, Musk owned about 22.4% of the company’s shares outstanding.
But then again, he would have had to anyway sell a huge block of his shares soon as a large chunk of his stock options are due to expire early next year – to prevent that he will most certainly have to sell before Dec.
But our question is whether Indian CEOs would ever resort to such decision making on Twitter? Here, they use the social media to decide on car names or the latest – new title for Bengaluru as the ‘Silicon Valley of India.’ Mahindra Group Chairman Anand Mahindra asked his Twitter followers to propose a new title and they seem to have zeroed in on ‘TecHalli’. But major corporate decisions like stake sale or buybacks or bonus shares?
Its unlikely as of now but then Musk has always been a disruptor and maybe he is showing us how things could be in the future? Nobody believed his EV venture 15 years ago and people scoff at his space venture too; maybe his Twitter habits are what the next generation CEOs will be about?
Indian CEOs, by nature are very conservative. We rarely have a ‘maverick’ CEO like Musk. There are major star-ups and unicorns in India but how many CEOs have we seen who are like Musk?
So, we feel using polls on social media to get suggestions on logos or names might become the norm but major corporate decisions? Nah!! Surely SEBI will sharpen its claws to ensure this definitely does not happen.