OpenAI’s high-profile CEO and ChatGPT creator, Sam Altman, was unexpectedly fired by the board of directors, shocking shareholders and big investors like Microsoft. The decision to oust Altman was announced on Friday, with the board citing a loss of confidence in his leadership abilities. Notably, Microsoft had invested over $10 billion in OpenAI and owns as much as 49% of the company.
The sudden dismissal of Altman, a cofounder of OpenAI, raised concerns about the board’s decision-making process and lack of communication with key stakeholders. This move was particularly surprising since Altman and the company’s president, Greg Brockman, were reportedly unaware of the decision beforehand.
John Bates, a tech entrepreneur and former fellow at Cambridge University, criticized the board’s handling of the situation, calling their behavior “erratic” and expressing disappointment in their failure to consider the impact on shareholders and staff. Microsoft CEO Satya Nadella also voiced his opinion, stating that the company should have been consulted before Altman was ousted.
The unconventional structure of OpenAI as a non-profit organization with a capped-profit company created in 2019 has also come under scrutiny. Most board members, including Altman, do not own shares in the company, limiting their influence. This contrasts with companies like Google and Meta, where founders hold greater voting rights and decision-making powers.
Despite the controversy, Altman’s decision to forgo equity was seen as a reflection of his commitment to social and environmental causes. The board’s actions have sparked criticism from industry figures like Marissa Mayer, who described OpenAI’s governance model as “crazy” and its board members as “broken and underadvised.”
Ultimately, Altman’s abrupt dismissal has raised questions about corporate governance and the responsibilities of boards in decision-making processes, particularly in the tech industry where influential figures hold significant power and influence.
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