[jacquesm]

Agreed, but then they did it in the worst possible way. You don't create a crisis around your brand like this on purpose. Much better to get everybody to play along and make it look as if Sam really wanted to spend more time with his family. Short of a cold body in his freezer this was done carelessly. But let's wait and see how it all develops because it is more than just a little strange to see it play out like this without a good enough reason for the haste, if it turns out there wasn't I expect the board to be axed.

[CPLX]

> I expect the board to be axed

By whom?

[jacquesm]

It could be as simple as using the bylaws as the chair of the board to point out a violation of the bylaws. It all depends, but at the end of the day board members that try to cling to their seats usually fail to do so. Ultimately their position could be challenged in court but most board members of non-profits are not that anxious to see their reputation destroyed that they'll let that be the deciding factor.

Either way, normally you'd have a pre-written resignation letter drafted where the only thing missing is their signature, and you'd confront them in a meeting: resign voluntarily or we'll put your continued presence up for a vote at the next board meeting. Of course the board could try to eternally vote itself back in but that usually doesn't work because a board has to be able to serve in its oversight role and one part of that is that the board has to have broad support, both legally and from within the organization. For instance: the board might no longer be able to find a CEO that is acceptable to the rest of the C-level. That would be a major problem.

Corporate governance is hard, non-profits have a bunch more twists but in the end nobody's position is carved in stone. Note that even non-profits have bylaws and these usually detail clearly how board members are to be proposed and what the procedure is to get them to become established as well as how they can be removed. If it can be proven that a board member has acted against the interests of the legal entity they represent then they usually can be removed even easier because that's a clear conflict with the statues of the non-profit, then there are potential conflicts of interest (for instance sitting on the board of another entity that has goals that are not compatible with those of the non-profit).

[CPLX]

Yeah but the board just took this action on purpose and decisively.

Who outranks them? I don’t get the premise. You’ve implied twice that they could lose their seats over it.

How? By what mechanism? Challenged in court or presented with a resignation letter by whom?

Seems to me they’re the top of the org chart. They’re only accountable in the sense that employees can quit or they can run out of money.

But they happen to have direct control of one of the most valuable pieces of technology ever created so what exactly are you suggesting will happen.

[jacquesm]

Nobody, including a board of directors is inviolable, it all depends on who the stakeholders of the non-profit are, the board is in principle independent but ultimately the judiciary still has more power than they do.

Depending on the bylaws it could be stakeholder: donors, beneficiaries or the employees of the non-profit in some organized form. All of these could petition the court if they feel that the non-profit wasn't governed properly. Note that it isn't known if the board acted unanimously (likely it it didn't) and what the grounds were. That will make a big difference to any outcome.

Non profits that lose their donors (especially if the money was pledged but not yet committed) usually don't live long so the board has some incentive to play ball.

[CPLX]

I mean yeah anyone can sue anyone, that’s a generally known fact.

But you said: “I fully expect the board to be replaced”

Ok, sure. By who? When?

I don’t see any reason to think that unless there’s a really genuinely large scale staff revolt.

[jacquesm]

> unless there’s a really genuinely large scale staff revolt

That's already underway, see other news about resignations at OpenAI, also donors have a very strong play to make.

Donors could simply withhold the next tranche, but possibly they can funnel enough money upwards from the for-profit to compensate for that.

Even so I would expect the other shareholders in the for-profit to be furious, especially those that liked Altman. So they're going to have to do some explaining because right now this does not deserve the beauty prize, to put it mildly.