Oslo, Norway – Norway’s sovereign wealth fund, managed by Norges Bank Investment Management, has announced its intention to vote against Tesla CEO Elon Musk’s $56 billion pay package at the company’s upcoming annual meeting. The fund, valued at $1.7 trillion and holding the position of the eighth largest Tesla shareholder, expressed concerns over the size of the award, its structure, performance triggers, dilution, and risk mitigation.
The chairperson of the Tesla Board of Directors, Robyn Denholm, emphasized the importance of “reciprocal respect” in a recent letter to shareholders, acknowledging Musk’s significant contributions but also highlighting the need for accountability and prudence in compensation decisions.
Nicolai Tangen, the chief executive of Norway’s wealth fund, criticized what he described as a growing trend of corporate greed, emphasizing the potential negative impact on shareholders due to excessive dilution.
Tesla shareholders are set to vote on Musk’s pay package, with previous approval granted in 2018 now facing renewed scrutiny following a judge’s decision to strike down the sum earlier this year. This move prompted the board to reassess and seek reapproval for the controversial compensation plan.
Two prominent proxy advisor firms, Institutional Shareholder Services (ISS) and Glass Lewis, recommended against supporting Musk’s pay package, citing concerns over its magnitude and implications for shareholder value. Denholm remarked that Musk’s wealth status makes the issue less about money and more about principles of governance and accountability.
Despite Tesla’s record sales of electric vehicles globally in 2023, the company has faced mounting challenges and scrutiny in recent months. Reports suggest that Musk has been diverting resources to other ventures, raising questions about allocation and prioritization within the organization.
In a series of controversial moves, Musk has been accused of exerting undue influence over decision-making processes, including the sudden dismissal of key personnel and public statements perceived as coercive or manipulative. Shareholders and industry observers have raised concerns about the impact of Musk’s actions on Tesla’s overall trajectory and performance in the competitive market.