Tesla’s board has labeled Elon Musk’s $1 trillion pay package “essential” for retaining him, but one of its largest investors has rebuffed the claim.
Norway’s sovereign wealth fund, a $17 billion shareholder, will vote “no” on the “essential” deal. The fund’s decision was based on governance principles, not on the board’s retention argument.
“We are concerned about the total size of the award,” the fund stated, also citing “dilution” and “key person risk.”
This “no” vote is a major challenge to the board’s narrative. Chair Robyn Denholm has warned shareholders that the company risks losing “significant value” if the 54-year-old CEO is not secured.
The Norwegian fund is not alone in its rebuff. Advisory firms Glass Lewis and ISS, along with the CalPERS pension fund, have also rejected the board’s “essential” plea.