Norwegian Wealth Fund Opposes Elon Musk’s $56 Billion Pay Package at Tesla
Norway’s sovereign wealth fund, operated by Norges Bank Investment Management, has announced its opposition to Elon Musk’s $56 billion pay package at Tesla’s annual meeting on Thursday. This decision was made based on concerns regarding the total size of the award, the structure given performance triggers, dilution, and lack of mitigation of key person risk. Norway’s sovereign wealth fund is valued at $1.7 trillion and is the eighth largest Tesla shareholder.
Controversial Pay Package and Shareholder Concerns
Robyn Denholm, chairperson of the Tesla Board of Directors, highlighted the need for “reciprocal respect” in a letter to shareholders earlier this week. She emphasized that Musk has no shortage of ideas and other places where he can make a significant difference in the world. The Norwegian wealth fund’s chief executive, Nicolai Tangen, expressed concerns about corporate greed reaching unprecedented levels, which has proven to be costly for shareholders in terms of dilution.
Shareholder Vote on Musk’s Pay Package
Despite initial approval of Musk’s pay deal in 2018, a judge in Delaware overturned the sum in January and required the board to reapprove it. At the upcoming annual meeting, Tesla shareholders will vote on the proposed pay package. Two major proxy advisory firms, Institutional Shareholder Services (ISS) and Glass Lewis, have recommended voting against it. Musk, who is currently the third richest person in the world with a net worth of $203 billion, would still be among the wealthiest individuals even if Tesla were to retract its commitment made in 2018.
Struggles Faced by Tesla
Tesla achieved record sales of over 1.8 million electric vehicles globally in 2023, yet the company has encountered increased scrutiny in recent months. Musk has been accused of diverting valuable resources to his other ventures, such as the social media platform X and his AI startup xAI. Additionally, investors criticized Musk for his actions, including the dismissal of Tesla’s entire Supercharger team, including senior director of EV charging Rebecca Tinucci, in April.
Quotes from Key Figures
Denholm stressed that the opposition to Musk’s pay package is not about the money, as Musk remains one of the wealthiest individuals globally. Tangen’s remarks concerning the escalating levels of corporate greed and the negative impact on shareholders highlight the seriousness of the issue. The decision made by the Norwegian wealth fund to vote against the pay package underscores the concerns shared by several stakeholders about the excessive compensation proposed for Musk.
Conclusion
Elon Musk’s $56 billion pay package at Tesla has sparked controversy and led to opposition from various parties, including Norway’s sovereign wealth fund. As Tesla shareholders prepare to vote on the deal, the concerns raised about the size of the award, performance triggers, dilution, and key person risk merit serious consideration. With Musk’s substantial wealth and the challenges faced by Tesla in recent months, it is essential for stakeholders to carefully evaluate the implications of the proposed pay package and its potential impact on the company’s future.
Ringkasan
Dana kekayaan negara Norwegia akan menolak paket gaji Elon Musk sebesar $56 miliar di Tesla. Pemegang saham Tesla akan memberikan suaranya tentang kesepakatan itu pada Kamis. Dua perusahaan penasihat proxy juga menentangnya. Apakah Anda setuju dengan keputusan dana kekayaan Norwegia untuk menolak paket gaji Elon Musk di Tesla? Bagaimana pendapat Anda tentang pendekatan Musk yang menurut mereka menyalahgunakan sumber daya perusahaan dengan fokus pada bisnis-bisnis lainnya seperti X dan xAI?
Berikan komentar dan pandangan Anda di bawah ini untuk berdiskusi lebih lanjut tentang topik ini. Apakah Anda merasa gaji Elon Musk yang sebesar $56 miliar di Tesla adalah sesuai dan adil dengan kontribusinya terhadap perusahaan, atau apakah Anda setuju bahwa dakwah kekayaan Negara Norwegia harus menolaknya? Ayo berikan pendapat Anda!
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