**Norway’s Wealth Fund to Vote Against Musk’s $56 Billion Pay Package**
In a move that underscores the growing scrutiny over executive compensation, Norway’s $1.7 trillion sovereign wealth fund has announced its intention to vote against the ratification of Tesla CEO Elon Musk’s $56 billion pay package. The decision comes ahead of a crucial shareholder vote next week, following a Delaware judge’s earlier invalidation of the package this year.
The fund, which is Tesla’s eighth-largest shareholder, holding a 0.98% stake worth $7.7 billion, has expressed concerns over the “total size of the award, the structure given performance triggers, dilution, and lack of mitigation of key person risk,” according to Norges Bank Investment Management (NBIM), the entity operating the fund. Despite acknowledging the “significant value generated under Mr. Musk’s leadership since the grant date in 2018,” the fund remains apprehensive about the implications of such a substantial compensation package.
Musk’s pay, which stands as the largest for a chief executive in corporate America, was initially approved in 2018 but was later voided by a judge who deemed the sum “unfathomable” and unfair to shareholders. The fund had also voted against the package in 2018, highlighting its consistent stance on excessive CEO compensation.
In addition to its position on Musk’s pay, the fund has shown support for labor rights, voting for a shareholder proposal urging Tesla to adopt a freedom of association and collective bargaining policy. This move is particularly relevant as Tesla faces industrial action in Sweden, with mechanics on strike since October 27, marking one of the country’s longest labor disputes.
The wealth fund’s decision reflects its broader critique of excessive executive pay, having voted against more than half of U.S. CEO pay packages above $20 million last year. It underscores the fund’s commitment to aligning executive compensation with long-term shareholder value creation.
Tesla shareholders are set to vote on Musk’s pay and other key issues, including the re-election of directors, at their annual meeting scheduled on June 13. The outcome of this vote could signal a significant shift in shareholder sentiment towards executive compensation practices, particularly in high-profile cases such as Tesla’s.