The approval is seen as an endorsement of Musk’s leadership and a sign that investors do not want to risk the company’s future. However, there are concerns that Musk, who now runs or owns six firms, is spreading himself too thin. Tesla’s share price has dropped about 55% from its 2021 peak as EV sales have slowed and Musk’s attention has wavered between Tesla and his other companies.
Key takeaways:
- Tesla shareholders have approved CEO Elon Musk’s $56 billion pay package, despite opposition from some large institutional investors and proxy firms.
- The approval does not resolve a lawsuit on the pay package in a Delaware court, which some legal experts think could stretch out for months.
- Shareholders also approved a proposal to move the company’s legal home to Texas from Delaware and the re-election of two board members: Musk’s brother Kimbal Musk and James Murdoch.
- Despite Tesla's share price dropping about 55% from its 2021 peak, shareholders endorsed the terms of the contract, signaling that Musk deserves to be rewarded for meeting the lofty thresholds of an entirely incentive-based contract.