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Tesla CEO Elon Musk could leave if $56 billion pay package not approved, shareholders warned

Jun 06, 2024 - theverge.com
Tesla's board chair, Robyn Denholm, is urging shareholders to approve Elon Musk's $56 billion pay package, warning that failure to do so could lead Musk to leave the company. The shareholders will vote on the package on June 13th, marking the second time they have done so after a Delaware judge voided the first vote due to a "deeply flawed" approval process. Denholm argues that Musk's unique role and Tesla's unconventional nature require a different approach to executive compensation.

Denholm's appeal comes amid concerns about Musk's future at Tesla, given his involvement in multiple other projects. Despite opposition from several proxy firms, early voting suggests that Musk's pay proposal may be approved, with over 80% of the 25% of shares already voted being in favor. Musk is also seeking a 25% stake in Tesla to further his ambitions in artificial intelligence and self-driving cars.

Key takeaways:

  • Tesla board chair Robyn Denholm is urging shareholders to approve Elon Musk's $56 billion pay package, warning that not doing so could risk driving Musk to other ventures.
  • This will be the second vote on Musk's compensation after a Delaware judge voided the first one, citing a deeply flawed approval process.
  • Denholm argues that Musk's unique position and Tesla's non-traditional nature require a different approach to executive compensation, and that Musk could potentially focus his efforts elsewhere without proper motivation.
  • Despite opposition from several proxy firms, early voting suggests that Musk's pay proposal could be approved, with over 80% of the 25% of shares already voted being in favor of the package.
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