With Jensen Huang under fire, Nvidia looks at sucession plans

The controversy surrounding Nvidia founder & CEO Jensen Huang has raised questions about the future leadership and succession planning at the company. At $4 trillion, the chipmaker is second only to Apple in terms of valuation.

A report in the The Wall Street Journal says that Huang runs a very flat leadership structure with about 60 direct reportees and there is no visible second rung of leadership or any potential successors in the company.

This has become an important question for Nvidia as Huang will come under increased scrutiny for his improper relationship with a Chinese national Alice Huang, who is allegedly a spy for the Chinese government. This relationship supposedly enabled China to get access to the high-end processors of Nvidia.

Also, reports quoting United States President Donald Trump said that the Federal Bureau of Investigation (FBI) is looking into the relationship between the Nvidia CEO and the Chinese national. Trump has defended Huang as a very "honorable" man.

In addition, the US Congress will also come into the picture seeking information on the kind of relationship and whether any sensitive technology has been passed onto China bypassing regulation.

However, reports also quoting an Nvidia spokesperson said, Jensen Huang is committed to continuing to lead Nvidia as CEO without interruption.

The Board of Nvidia has already stated that it would be investigating the entire matter.

The leadership question comes into picture as there is the angle of national security with regard to the CEO’s relationship with the Chinese citizen and this brings the government into the picture. This is not a leadership crisis which a corporate typically faces where the issues are generally around business challenges, shareholder dissatisfaction, and physical health of the CEO.

Jensen Huang has built a larger-than-life picture not just for Nvidia but also for the AI world. He is seen as an influential individual determining the contours of any new policy with regard to the AI industry. Along with this, he is also well networked with the various heads of States across the globe.

Though, it must be noted that both his children, Madison Huang and Spencer Huang work at Nvidia. Additionally, his son-in-law Nico Caprez also works with the company.

At this point of time, it is difficult to gauge the future direction of Nvidia as there are several elements in play. The improper relationship is one aspect, the bigger repercussion is whether technology was illegally acquired by a foreign country.

Although at the same time, some industry watchers see it as a proxy fight between the United States and China to gain the upper hand in the world of AI. China is seen as being close to matching the technology prowess of the United States and potentially overtaking it.