Elon Musk Settled With the S.E.C., but Tesla’s Troubles Aren’t Over

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His intensity and ferocious work ethic have led to a wave of executive departures in recent years, and Tesla’s board — which includes Mr. Musk’s brother, Kimbal — is not particularly independent by the standards of most big companies.

The terms of the S.E.C. settlement are intended to change some of that.

Tesla will have to add two independent directors to the board, Mr. Musk will not be able to serve as chairman for three years and the board will have to set up a permanent committee to monitor Mr. Musk’s communications with investors and the public, including his postings on Twitter and other social media. The members of this special committee will be subject to the review and approval of the S.E.C.

Tesla also must “implement mandatory procedures and controls to oversee all of Elon Musk’s communications regarding the company in any format,” according to the settlement. The S.E.C. will monitor to make sure the company is in compliance with those procedures.

Some critics of the settlement suggested that the S.E.C. — which sought to bar Mr. Musk from serving as a director or executive of a public company in a lawsuit it filed on Thursday, two days before the settlement — was letting him off easy.

Remarks by the S.E.C.’s chairman, Jay Clayton, about the settlement added to the perception that regulators were making an exception for Mr. Musk, who is so central to Tesla. Mr. Clayton said there was a need to balance penalties for violating securities laws with “the skills and support of certain individuals” who may be important “to the future success of a company.”

But Rebecca Roiphe, a professor at New York Law School, said removing Mr. Musk from a leadership role in the company would have been a mistake.

“I think banning him as C.E.O. would have been out of proportion considering what he did and that he is the founder, major shareholder and brains behind an innovative company,” she said of Mr. Musk, who is officially a co-founder. The S.E.C. is a civil, regulatory body, she noted, and its aim is to protect investors. “While it shares some of the same goals as federal prosecutors, its mission is different.”

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