Elon Musk takes part in a press conference in the Oval Office at the White House in Washington D.C., in May 30. Tesla shareholders are voting this week whether to award Musk a roughly $1 trillion compensation package. File photo by Francis Chung/UPI | License Photo
Norway’s sovereign wealth fund said Tuesday it plans to reject the nearly $1 trillion payout to Tesla’s CEO, Elon Musk, during its annual shareholder meeting this week.
Musk, whose current net worth is more than $400 billion, was poised to receive a performance award worth about $900 billion and 432 million additional shares in the electric vehicle company, about a 25% ownership stake. If approved, the compensation plan would make Musk the world’s first trillionaire, The Guardian reported.
Norges Bank Investment Management said it will vote against the compensation plan at Thursday’s meeting. The world’s largest sovereign wealth fund is the seventh-largest stakeholder in Tesla, holding about 1.14% stake in the company.
“While we appreciate the significant value created under Mr. Musk’s visionary role, we are concerned about the total size of the award, dilution and lack of mitigation of key person risk — consistent with our views on executive compensation,” the company said in a statement.
“We will continue to seek constructive dialogue with Tesla on this and other topics.”
Robyn Denholm, the chairwoman of Tesla’s board of directors, said last week that the company may lose Musk as CEO if shareholders vote against his compensation package.
“Without Elon, Tesla could lose significant value, as our company may no longer be valued for what we aim to become,” she said.
Denholm claimed the electric vehicle maker was at a “critical inflection” point, and that losing Musk could mean Tesla loses “significant value.”
“The fundamental question for shareholders at this year’s annual meeting is simple: Do you want to retain Elon as Tesla’s CEO and motivate him to drive Tesla to become the leading provider of autonomous solutions and the most valuable company in the world?” she asked rhetorically.
Meanwhile, a Take Back Tesla coalition made up of unions and corporate watchdogs, have urged shareholders against voting for the pay package, CNBC reported. Proxy advisories, Institutional Shareholder Services and Glass Lewis have also campaigned against it.
