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Business News/ Companies / News/  Elon Musk may leave Tesla if $56 billion pay not approved, Robyn Denholm warns shareholders ahead of board meeting
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Elon Musk may leave Tesla if $56 billion pay not approved, Robyn Denholm warns shareholders ahead of board meeting

Ahead of the Tesla shareholders meeting this week, electric automaker’s chairperson Robyn Denholm has said that CEO Elon Musk may leave the company if shareholders vote against his $56 billion pay package during the June 13 meeting

Chairperson Robyn Denholm said these votes are about fairness, respect and the future of TeslaPremium
Chairperson Robyn Denholm said these votes are about fairness, respect and the future of Tesla

Ahead of the Tesla shareholders meeting this week, electric automaker’s chairperson Robyn Denholm said CEO Elon Musk may leave the company if shareholders vote against his $56 billion pay package during the June 13 meeting.

In a letter to Tesla shareholders—filed with the Securities and Exchange Commission—chairperson Denholm said, “Elon is not a typical executive, and Tesla is not a typical company…So, the typical way in which companies compensate key executives is not going to drive results for Tesla. Motivating someone like Elon requires something different."

“These votes are about fairness, respect and the future of Tesla," she wrote.

Denholm stressed that if shareholders reject the pay package, Musk may take his talents elsewhere.

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 The Tesla chairperson said Musk may decamp to “other places" without proper motivation. “Nor does he face any shortage of ideas and other places he can make an incredible difference in the world. We want those ideas, that energy and that time to be at Tesla, for the benefit of you, our owners. But that requires reciprocal respect," she continued.

It is important to note that the company shareholders will be voting second time on the CEO's compensation after a Delaware judge voided the one earlier this year on the grounds that the approval process was “deeply flawed."

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In the letter to investors, Denholm insisted that the biggest remuneration deal in US corporate history is “obviously not about the money" because "We all know Elon is one of the wealthiest people on the planet, and he would remain so even if Tesla were to renege on the commitment we made in 2018."

Musk also operates X, SpaceX, Neuralink, xAI and the Boring Co.

“If Tesla is to retain Elon's attention and motivate him to continue to devote his time, energy, ambition and vision to deliver comparable results in the future, we must stand by our deal," she added.

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Some Tesla investors have expressed concern about his ability to focus on Tesla.

Notably, Musk is looking to acquire a 25% interest in Tesla, which would give him more influence over the company to accomplish his objectives of creating AI and self-driving vehicles. Musk has also threatened to split off Tesla's AI research into a different company if his demands are unsatisfied.

 

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Published: 09 Jun 2024, 05:13 PM IST
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