At the end of today’s meeting, shareholders have approved Elon Musk’s $1 trillion pay package, a long-debated condition for the billionaire businessman remaining as CEO of the company.
The meeting lasted over two hours.
Chair Robyn Denholm had in a letter to shareholders on Monday, warned that Elon Musk could leave Tesla as CEO if his proposed $1 trillion pay package was not approved.
CEO of shareholder advisory firm Jasper Street Partners, Jessica Strine, said that many shareholders likely felt they had no choice but to support the company and its well-known CEO on the key proxy questions.
Assuming Musk voted his roughly 15% stake “for” his own compensation, a win of 75% for his $1 trillion package would indicate that only 60% of outside investors supported it.
At a typical company, that level of support for compensation would warrant review of CEO pay by the board, but not, she said, at Tesla.
“Realistically, there is not going to be such a review. Never say never. But, never,” she said.
President of corporate governance consulting firm Soundboard Governance LLC, Douglas Chia, said Thursday’s 75% approval rate for Musk’s $1 trillion pay award was in line with the support shareholders gave him last year as they re-approved his previous $56 billion package.
“My takeaway is that the board could give Elon the entire store and still get 75% shareholder support!” Chia said.
“At this point, they might as well do that next year because he’s always going to come back asking for more and get it.”
New York State Comptroller, Thomas P. DiNapoli, who has urged shareholders to reject Musk’s pay package, released a statement after the vote: “This vote shows how far Tesla’s governance has drifted from accountability and respect for the rights of shareholders,” he said.
“Elon Musk increased his control by buying nearly a billion dollars in stock on the record date and essentially tipping the scales in his favour. This is pay for unchecked power, not pay for performance. The board has rewarded distraction and entrenched a CEO who answers to no one. We will continue pressing for accountability, independence, and respect for shareholder rights to protect long-term value.”
Investors also heard DiNapoli’s recorded message on the state’s proposal to amend bylaws to repeal the 3% derivative suit threshold, which ultimately failed to pass.
Musk spoke in front of a screen with the phrase “sustainable abundance” on it, and the phrase has been referenced by some shareholders.
During the company’s third-quarter earnings call in October, he declared, “We’re excited about the updated mission of Tesla, which is sustainable abundance.”
Loosely defined, the theory is that what Tesla is doing will make everyone richer because their self-driving cars and robots will make everything easier.
When asked about power and money, Musk simply said AI is going to take over.
“It’s not just a new chapter for Tesla. It’s a new book and that new book is massively increasing vehicle production and ramping up Optimus production faster than anything ever been ramped up before in history,” he said, referring to Tesla’s humanoid robots.
Elon Musk’s $1 Trillion Pay Package Gets Shareholders’ Approval
At the end of today’s meeting, shareholders have approved Elon Musk’s $1 trillion pay package, a long-debated condition for the billionaire businessman remaining as CEO of the company.
The meeting lasted over two hours.
Chair Robyn Denholm had in a letter to shareholders on Monday, warned that Elon Musk could leave Tesla as CEO if his proposed $1 trillion pay package was not approved.
CEO of shareholder advisory firm Jasper Street Partners, Jessica Strine, said that many shareholders likely felt they had no choice but to support the company and its well-known CEO on the key proxy questions.
Assuming Musk voted his roughly 15% stake “for” his own compensation, a win of 75% for his $1 trillion package would indicate that only 60% of outside investors supported it.
At a typical company, that level of support for compensation would warrant review of CEO pay by the board, but not, she said, at Tesla.
“Realistically, there is not going to be such a review. Never say never. But, never,” she said.
President of corporate governance consulting firm Soundboard Governance LLC, Douglas Chia, said Thursday’s 75% approval rate for Musk’s $1 trillion pay award was in line with the support shareholders gave him last year as they re-approved his previous $56 billion package.
“My takeaway is that the board could give Elon the entire store and still get 75% shareholder support!” Chia said.
“At this point, they might as well do that next year because he’s always going to come back asking for more and get it.”
New York State Comptroller, Thomas P. DiNapoli, who has urged shareholders to reject Musk’s pay package, released a statement after the vote: “This vote shows how far Tesla’s governance has drifted from accountability and respect for the rights of shareholders,” he said.
“Elon Musk increased his control by buying nearly a billion dollars in stock on the record date and essentially tipping the scales in his favour. This is pay for unchecked power, not pay for performance. The board has rewarded distraction and entrenched a CEO who answers to no one. We will continue pressing for accountability, independence, and respect for shareholder rights to protect long-term value.”
Investors also heard DiNapoli’s recorded message on the state’s proposal to amend bylaws to repeal the 3% derivative suit threshold, which ultimately failed to pass.
Musk spoke in front of a screen with the phrase “sustainable abundance” on it, and the phrase has been referenced by some shareholders.
During the company’s third-quarter earnings call in October, he declared, “We’re excited about the updated mission of Tesla, which is sustainable abundance.”
Loosely defined, the theory is that what Tesla is doing will make everyone richer because their self-driving cars and robots will make everything easier.
When asked about power and money, Musk simply said AI is going to take over.
“It’s not just a new chapter for Tesla. It’s a new book and that new book is massively increasing vehicle production and ramping up Optimus production faster than anything ever been ramped up before in history,” he said, referring to Tesla’s humanoid robots.
