Tesla Investors Urge Shareholders to Reject Elon Musk's $1T Compensation Plan
A group of Tesla investors and US state pension fund representatives is urging shareholders to reject a proposed compensation package for CEO Elon Musk, which could potentially reach a value of one trillion dollars. The group has also called for the removal of three board members.
The '2025 CEO Performance Award' up for a vote has been criticized for its vague, lenient, and subjective performance goals. The investors argue that Tesla's sales and market share have fallen, and earnings have stagnated or declined since the last annual meeting. They warn that the proposed compensation package could lead to significant dilution of existing shareholders' stakes if all goals are met.
Tesla has countered that the compensation plan fully aligns Musk's compensation with shareholder value creation. However, the main criticisms include declining corporate performance, insufficient board oversight, and excessive executive compensation. The board is accused of being compromised in its ability to objectively control management due to personal ties to CEO Musk and excessive compensation.
The group has called for the removal of directors Ira Ehrenpreis, Kathleen Wilson-Thompson, and Joe Gebbia due to their tenure, friendship with Musk, and role in approving his compensation. New York State Comptroller Thomas P. DiNapoli has announced that the state's pension fund will vote against the proposal to authorize billions in payouts to Elon Musk.
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