The pay package is just one of a series of measures that shareholders have already been asked to vote on by proxy, ahead of Thursday’s meeting. Others include whether Tesla’s incorporation should be moved from Delaware to Texas, whether the company should soften its hardline stance in labor negotiations and whether the company should preemptively impose a moratorium on the use of minerals extracted from the seabed.
However, none have been as divisive as Musk’s salary. Deep divisions among investors have been exposed in the run-up to the vote. Tesla Chairman Robyn Denholm backed the pay package, as did billionaire investor Ron Baron. “Tesla is better with Elon”, Baron he wrote in an open letter last week. “Tesla is Elon.” However, opponents of the deal include two influential proxy advisory groups, which guide institutional investors in voting, as well as shareholders in the Nordic countries, where Tesla has clashed with workers over labor rights.
Norway’s $1 trillion sovereign wealth fund has said it will vote against the pay deal, as has the country’s largest pension fund, KLP. “While we recognize that the company has grown significantly and successfully during the performance period, we still note that the total value of the award remains excessive,” Kiran Aziz, head of responsible investments at KLP, told WIRED, adding that The fund will vote in favor of the motion urging Tesla to participate in labor negotiations. “The recent (dispute) between Tesla and the company’s workers in Sweden, as well as Tesla’s history of accusations of interference with workers’ rights, are of great concern and show that the company needs to do better in the area “.
Behind the scenes of the vote, the lobbying has been intense. Tesla has paid for ads on Musk-owned Google and X, telling investors to “protect your investment” and support the proposal, according to one company. presentation with the Securities and Exchange Commission. In April, Tesla also launched a website urging shareholders to vote against the Delaware court decision and support the pay package. “The Court’s decision, if implemented, means that Elon would receive no compensation for the tremendous achievements that have generated significant returns for shareholders in less than six years,” the website says. read.
“This is the most publicity I can remember for any request for representation,” says Robert Anderson, a professor at the University of Arkansas School of Law. He believes the Musk effect (the CEO’s ability to attract endless publicity) has contributed to this situation. But the pay package and the proposed measure in Texas are unprecedented in the business world, he adds. “Any of those things alone would be pretty significant, even if he wasn’t a public figure.”
The vote will be decided by a combination of institutional investors, as well as an unusually large group of retail investors, who control about 44 percent of the business. Among shareholders, there is concern that if Musk doesn’t win compensation from him, “their attention might be diverted from him a little bit more to some of his other ventures,” Anderson says. Musk managed to juggle multiple companies for years, but he has become more publicly distracted since acquiring the social media service Twitter and renaming it X. There, his visible turn toward right-wing politics has gained new followers and left back to some old ones.
Whatever happens this week, Tesla and Musk may emerge looking a little less superhuman. For years, the two have insisted that Tesla is a technology company, with Silicon Valley-style startups. “We should be considered an artificial intelligence or robotics company,” Musk told investors (or voters) in April. “If you value Tesla simply as an automotive company…fundamentally, it’s just the wrong framework.”