- Telsa faces investor opposition over reinstating Elon Musk’s $55 billion pay package.
- The largest public pension fund in the United States is currently planning to vote against the pay plan.
- Musk criticized the pension fund for “breaking its word.”
Tesla is facing growing opposition from investors regarding its attempt to return Elon Musk’s $55 billion pay package.
On Wednesday, there was another sign that Tesla may face an uphill battle when California Public Employees Retirement System CEO Marcy Frost decided, He told CNBC The fund plans to vote against the proposal to reinstate Musk’s pay plan, pending any future talks with Tesla.
“We don’t believe compensation is proportionate to the company’s performance,” Frost said.
CalPERS is the largest public pension fund in the United States and is one of the 30 largest investors in Tesla with about 9.5 million shares, according to Bloomberg. Frost told CNBC that the fund initially voted in favor of Musk’s pay package when it was put to a shareholder vote in 2018, but CalPERS later revision Her comments came in a post on X, explaining that the fund voted against the proposal in 2018 as well.
Musk does not receive a salary from Tesla, and his salary package is centered around a series of goals around the automaker’s financial growth. The plan, which was worth $55 billion Bloomberg When a Delaware judge struck it down in January, it included a 10-year grant consisting of 12 tranches of stock options that vest when Tesla hits specific targets. When the company achieves each milestone, Musk will receive shares equal to 1% of the shares outstanding at the time of the grant. Tesla said it has achieved all 12 goals as of 2023.
Musk quickly posted on social media criticizing CalPERS’ stance on the proposal on Wednesday.
“What you are saying makes no sense, as all contractual milestones have been met. CalPERS is going against its word,” Musk books On X.
CalPERS joins a growing list of investment funds that have publicly expressed interest in voting against Tesla’s compensation plan for Musk. On May 21, a group of shareholders submitted a letter to the Securities and Exchange Commission Call for investors To vote against Musk’s salary package and the re-election proposal of James Murdoch and Kimbal Musk. Separately, proxy consulting firm Glass Lewis said in a report on Saturday that Payment plan was ‘excessive’ It presented investors with “uncertain benefits and additional risks.”
At the same time, Tesla did its best to promote this proposal. On Wednesday, the company began offering investors the opportunity to tour the giant Texas factory alongside Musk in exchange for proof that they voted at Tesla’s annual meeting. Tesla might as well Argue The compensation plan is considered “critical to Tesla’s future success” and has even paid for itself A bunch of ads Strengthen the pay plan.
The annual investor meeting is scheduled to be held on June 13. Shareholders will be asked to vote on several proposals in addition to the proposal to restore Musk’s salary package, which was A Delaware judge struck her Earlier this year. The company is also asking investors to vote on a proposal to move Tesla’s state of incorporation from Delaware to Texas and a separate proposal to re-elect Tesla board members Kimbal Musk and Murdoch.
A Tesla spokesman did not immediately respond to a request for comment.
Correction, May 30: This story has been updated to reflect that CalPERS said it voted against Elon Musk’s 2018 pay proposal, not for it, as its CEO initially said during the interview with CNBC.
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