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Microsoft will push for changes to OpenAI’s governance structure

  • November 22, 2023
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It looks like the momentum surrounding OpenAI CEO Sam Altman’s resignation on Friday won’t fade this week as it’s a long weekend in the US and stakeholders are

Microsoft will push for changes to OpenAI’s governance structure

It looks like the momentum surrounding OpenAI CEO Sam Altman’s resignation on Friday won’t fade this week as it’s a long weekend in the US and stakeholders are trying to resolve all the issues by Friday. Microsoft, OpenAI’s largest investor, has drawn some conclusions from this whole story and plans to insist on reforming the business management structure of this startup.

Let us remind you that the non-profit structure, which owns only 2% of OpenAI’s shares, actually manages the initiative, while Microsoft, which has a 49% share, does not have a representative on the board of directors. but he also gets messages about last-minute strategic changes, like the story about Sam Altman’s sudden resignation. last Friday. According to rumors, OpenAI’s board of directors is currently discussing the possibility of returning Altman to the company in one way or another, and Microsoft, which provides shelter for him, does not officially object to such transfers, but any outcome of the negotiations will require OpenAI to expect greater predictability in business management structures It wants to achieve changes that will enable it and ideally allow it to influence the company’s strategic decision-making process.

This was reported by the Bloomberg agency in the morning, citing knowledgeable sources. Whatever the outcome of Altman’s talks with the board, Microsoft wants to increase the size of that governing body and impose higher qualification requirements for its members. An existing agreement between Microsoft and OpenAI requires Microsoft to approve any potential merger deal with OpenAI, but that condition was not met during negotiations with Anthropic learned the previous day. Microsoft wants to protect its interests in its status as an OpenAI investor and wants to add at least a number of scenarios that imply the right of veto or the need for early notification of strategically important decisions taken.

Microsoft is waiting for OpenAI’s new board to begin implementing measures to protect its interests. The company invested about $13 billion in capital in the startup and began to closely integrate its developments into software solutions, so after the stabilization of the situation under OpenAI, Microsoft plans to initiate its interests in the management structure of the startup.

CEO Satya Nadella made it clear that OpenAI needs serious reforms in business management. Ideally, Microsoft would want to appoint an executive of a certain level to the OpenAI board. But in this case, all the risks associated with this must be weighed, since a similar degree of control over the affairs of the second company could attract the attention of American regulators to this step.

Source: Port Altele

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