The maxi-compensation from 1 trillion dollars for Elon Musk, a largely record package even in the annals of corporate America’s golden salaries, was approved by Tesla shareholders, who were asked to decide whether it was adequate or excessive. The compensation, in shares, is linked to a series of ambitious operational and stock market performance objectives over the next decade.
The outcome was no surprise: the green light was in the cards at the annual shareholders’ meeting in Austin, Texas, where the company moved its headquarters for free and favorable tax and regulatory regimes. In the state, Musk was also able to vote his share, today around 13%-15%, in favor of the compensation. And the top management of the board, very close to Musk so much so as to arouse never-ending controversy about their independence, had warned that the future of the electric and hi-tech car giant could otherwise be at stake, with the CEO abandoning himself.
Musk himself had threatened to leave his company in the event of a rejection, effectively putting shareholders faced with a choice: decide whether to take that risk or minimize governance and social concerns, with the extraordinary prize promised to the already richest man in the world.
Signs of tension had emerged on the eve of the vote: some significant shareholders had publicly revealed their negative voting intentions. Among these, the Norwegian sovereign fund has announced its ‘no’, as has the largest American pension fund Calpers. Rejections also came from large member consultancy firms, such as Glass Lewis and ISS. Contrary voices were raised by numerous unions.
However, there was no shortage of statements of support. Charles Schwab, Morgan Stanley and the Florida public pension fund have spoken in favor of the maxi-compensation to Musk.
