Tesla investors give nod to record $56 billion pay package for Elon Musk

Tesla investors overwhelmingly support historic $56 billion pay package for Elon Musk, confirmed the Tesla owner via a post on X.

Livemint
Published13 Jun 2024, 06:36 PM IST
For representation purposes only.
For representation purposes only.(ETIENNE LAURENT / AFP)

In a pivotal shareholder vote, Tesla Inc. investors have expressed overwhelming support for a historic $56 billion pay package for CEO Elon Musk and a relocation of the company's legal domicile from Delaware to Texas. Elon Musk, known for his active presence on social media platforms, confirmed the developments late Wednesday, thanking shareholders for their backing.

The approval of this massive pay deal marks a significant milestone in U.S. corporate history, aimed at securing Musk's long-term commitment to Tesla amidst ongoing legal challenges. Notably, the vote comes amidst a backdrop of shareholder concerns and legal disputes surrounding the initial 2018 pay package, recently invalidated by a Delaware court. This decision has prompted Tesla's board to seek reinforcement through shareholder endorsement.

A preliminary voting tally indicated robust support from a coalition of institutional investors and retail shareholders alike, positioning Tesla to potentially navigate legal hurdles and reinforce its leadership stability under Musk. The final outcome of the vote is slated for announcement at Tesla's headquarters in Texas later today.

Despite opposition from major proxy firms such as Glass Lewis and Institutional Shareholder Services (ISS), as well as significant institutional investors like Norway's sovereign wealth fund and prominent U.S. pension funds, Musk's persuasive influence over retail investors appears to have swayed the balance in favor of the proposed package.

Beyond the pay package, shareholders also cast ballots on pivotal corporate decisions including the relocation of Tesla's legal headquarters and the re-election of board members, underscoring broader strategic shifts within the company.

Tesla's stock surged in premarket trading following the news, reflecting investor optimism over the company's future direction under Musk's leadership despite recent market challenges. With ongoing legal battles looming, including appeals concerning board accountability and shareholder rights, the outcome of today's vote sets the stage for Tesla's next chapter under Musk's ambitious stewardship.

As Tesla continues to navigate regulatory scrutiny and market volatility, the shareholder endorsement of Musk's compensation package represents a crucial vote of confidence in his leadership and vision for the company's future amidst a rapidly evolving automotive and technology landscape.

(With inputs from Reuters)

 

 

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First Published:13 Jun 2024, 06:36 PM IST
HomeCompaniesTesla investors give nod to record $56 billion pay package for Elon Musk

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