Outlook Business Desk
Tesla shareholders are set to decide Thursday on an unprecedented compensation plan for Elon Musk. The package aims to keep him at the helm long enough to drive major advancements in AI, robotics, and autonomous technology.
Musk could receive up to $1 trillion under the plan if Tesla achieves its challenging performance targets. The package links payouts to milestones in market value, vehicle production, and operational goals, ensuring his leadership for more than seven years.
Tesla Chair Robin Denholm publicly endorsed the plan, emphasising that Musk’s continued leadership is critical to maintaining Tesla’s long-term transformative vision. Denholm argued the company’s valuation and innovative potential depend heavily on Musk’s presence.
If approved, the pay package could increase Musk’s Tesla ownership to over 25% from the current 12%. Musk has hinted he may step back if his influence and shareholding in Tesla do not meet his expectations.
Musk stated he does not intend to spend the money but seeks influence over Tesla’s ambitious projects, including robotics. He described the package as a tool to maintain strong control over the company’s future innovations.
The outcome of the vote will be announced at Tesla’s annual shareholder meeting in Austin, Texas, on Thursday. Anti-Musk protests are expected outside the gigafactory, following a rally in downtown Austin the day before opposing the pay package.
Critics, including activist Ethan McBride, condemned the plan as excessive and potentially harmful to democracy. Advisory firms ISS and Glass Lewis also opposed it, citing insufficient safeguards and questioning whether Musk’s already vast wealth justifies such an extraordinary payout.
Norway’s sovereign wealth fund, among Tesla’s top shareholders, announced it will vote against Musk’s pay package, raising concerns over its size, share dilution, and key person risk. The New York State Comptroller has also voiced opposition for similar reasons.
Meanwhile, Florida state officials endorsed Musk’s package, calling it the ''gold standard for executive compensation'' and noting his track record of creating shareholder value.