Nvidia's board announced on Tuesday, Nov 10 local time that it has hired New York law firm Wachtell, Lipton, Rosen & Katz to conduct an independent investigation into the conduct of CEO Jensen Huang. The decision came just two days after Huang admitted to an affair with a woman alleged to have ties to Chinese intelligence. According to The Information, the board first announced on Sunday that it would launch an investigation and formally confirmed the outside counsel on Tuesday.
How it began: Huang admits affair
According to CNBC, Huang admitted on Sunday to having an affair with a woman who has been connected to Chinese intelligence by reports in The New York Times and Financial Times. BBC Technology likewise reported that the board moved to open an investigation after the relationship came to light. None of the sources provided further details about the woman's identity or the nature of the alleged ties.
The probe: Wachtell to lead independent review
According to a briefing obtained by The Information, the Nvidia board hired Wachtell, Lipton, Rosen & Katz to carry out an "independent investigation" focused on Huang's conduct. The board did not disclose in a public statement the scope of the probe, its timeline or whether it covers the company's China business decisions. Wachtell is a top US corporate governance and litigation firm, often retained to handle investigations into the conduct of executives at public companies.
The board did not disclose in a public statement the scope of the probe, its timeline or whether it covers the company's China business decisions.
Impact and concerns: governance intertwined with China policy
The investigation comes at a sensitive time for Nvidia's chip sales policy toward China. Huang, as founder and CEO, has long driven Nvidia's strategic direction, including compliance and sales arrangements in the Chinese market. The board's launch of an independent investigation could raise investor concerns about the stability of corporate governance, but so far Nvidia has not said whether the probe will affect day-to-day operations or the China business.
On reactions, BBC, CNBC and The Information all reported the board's hiring of the law firm but did not mention further comment from Huang or the board. The market impact remains to be seen, and attention will focus on the progress of the investigation, whether the board discloses more details, and whether US regulators step in.