Uber Technologies Inc’s embattled Chief Executive Travis Kalanick told employees in an email on Tuesday that he will take time away from the company he helped to found, citing the need to grieve for his recently deceased mother, according to a copy of the memo seen by Reuters.
Uber also released the recommendations of a months-long investigation led by the law firm of former U.S. Attorney General Eric Holder who was retained by Uber to look into company culture and practices.
The recommendations, which were unanimously adopted by the board on Sunday, call for reducing Kalanick’s sweeping authority and instituting more controls over spending, human resources and the behavior of managers.
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Specifically, the recommendations call for adding independent members to the board of directors, including an independent chair. They also spell out changes to company culture, including prohibiting romances between bosses and their reports and creating clearer guidelines around use of drugs and alcohol.
Kalanick’s leave of absence follows a day-long board meeting on Sunday during which members of Uber’s board of directors discussed the possibility of Kalanick temporarily stepping away from the company.
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In his email, Kalanick did not specify how long he would be away from the company, but cited the need to take time off to grieve the loss of his mother, who died in a recent boating accident.
“If we are going to work on Uber 2.0, I also need to work on Travis 2.0 to become the leader that this company needs and that you deserve,” Kalanick wrote in his email
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Emil Michael, senior vice president and a close Kalanick ally, has left the company, the source said.
The company is also adding a new independent director, Nestle executive and Alibaba board member Wan Ling Martello, a company spokesman said.
Holder and his law firm were retained by Uber in February to investigate company practices after former Uber engineer Susan Fowler published a blog post detailing what she described as sexual harassment and a lack of a suitable response by senior managers.
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The recommendations in Holder’s firm’s report place greater controls on spending, human resources and other areas where executives led by Kalanick have had a surprising amount of autonomy for a company with more than 12,000 employees, sources familiar with the matter said.
Kalanick and two allies on the board have voting control of the company. Kalanick’s forceful personality and enormous success with Uber to date, as well as his super-voting shares, have won him broad deference in the boardroom, according to the people familiar with the deliberations.
The world’s most valuable venture-backed private company has found itself at a crossroads as its rough-and-tumble approach to local regulations and handling employees and drivers has led to a series of problems.
It is facing a criminal probe by the U.S. Department of Justice over its use of a software tool that helped its drivers evade local transportation regulators, sources have told Reuters.
Last week, Uber said it fired 20 staff after another law firm looked into 215 cases encompassing complaints of sexual harassment, discrimination, unprofessional behavior, bullying and other employee claims.
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A temporary departure by Kalanick could be a shock for the Silicon Valley startup world, where company founders in recent years have enjoyed more autonomy and often become synonymous with their firms.
Uber‘s image, culture and practices have been largely defined by Kalanick’s brash approach, company insiders and investors previously told Reuters.
Uber board member Arianna Huffington said in March that Kalanick needed to change his leadership style from that of a “scrappy entrepreneur” to be more like a “leader of a major global company.” The board has been looking for a chief operating officer to help Kalanick run the company since March.
The debate over Kalanick’s future comes as he is also facing a personal trauma: His mother died last month in a boating accident, in which his father was also badly injured.
Michael, described by employees as Kalanick’s closest deputy, has been a recurring flashpoint for controversy at the company.
He once discussed hiring private investigators to probe the personal lives of reporters writing stories faulting the company. Kalanick disavowed and publicly criticized the comments.
Michael will be replaced as the company’s top business development executive by David Richter, currently an Uber vice president, the company spokesman said.
Alongside Uber‘s management crisis, its self-driving car program is in jeopardy after a lawsuit from Alphabet Inc alleging trade secrets theft, and the company has suffered an exodus of top executives.
One Uber investor called the board’s decisions on Sunday a step in the right direction, giving Uber an “opportunity to reboot.”
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