Tesla Shareholders Urged to Back Elon Musk’s $56 Billion Pay Package

Tesla Chair Urges Shareholders to Back Elon Musk’s $56 Billion Pay Package

In a recent letter to investors, Tesla board chair Robyn Denholm is calling on the company’s shareholders to support CEO Elon Musk’s $56 billion pay package. Denholm emphasized that the upcoming vote on Musk’s compensation is not about the money but about honoring a commitment made by shareholders in 2018.

The vote, scheduled for June 13th, comes after a Delaware judge rejected the initial plan earlier this year, citing concerns about Musk’s control over the board. Denholm warned that if investors veto the package, Musk could shift his focus to other projects, as he does not have unlimited time and is constantly generating new ideas.

Musk, who also heads SpaceX and owns the social media platform X, does not receive a salary from Tesla. Instead, his compensation is primarily in stock awards tied to performance metrics set in 2018. Denholm highlighted that Musk had to meet specific milestones that directly benefited the company and its shareholders to realize any benefit from the award.

Despite the support from some prominent shareholders like billionaire Ron Baron, multiple shareholder advisory firms have come out against reinstating the pay package. Concerns have been raised about Musk’s involvement in other ventures and the potential dilution of shareholders’ value.

If the compensation plan is reapproved, it would be the largest in the history of corporate America. Tesla’s market value has skyrocketed from $53 billion to nearly $560 billion since the approval of Musk’s package in 2018, showcasing the impact of his leadership on the company’s growth.

The Associated Press contributed to this report, highlighting the ongoing debate surrounding Elon Musk’s compensation and the implications for Tesla’s future.