Tesla Shareholders Urged to Decline Musk’s $56 Billion Compensation Offer

Glass Lewis, a proxy advisory firm, has made a bold recommendation to Tesla shareholders regarding CEO Elon Musk’s proposed $56 billion pay package. The firm has urged shareholders to reject the package, which would make it the largest pay package for a CEO in corporate America.

The report from Glass Lewis cited concerns about the “excessive size” of the pay deal, its dilutive effect on ownership, and Musk’s involvement in a slate of time-consuming projects, including his recent high-profile purchase of Twitter, now known as X.

The proposed pay package, put forth by Tesla’s board of directors, has faced criticism for its lack of salary or cash bonus, instead setting rewards based on Tesla’s market value reaching as much as $650 billion over a 10-year period. Currently, the company is valued at about $571.6 billion.

In response to the recommendation from Glass Lewis, Tesla has urged shareholders to reaffirm their approval of the compensation package. Board chair Robyn Denholm defended Musk’s eligibility for the pay package, citing the company’s success in hitting ambitious revenue and stock price targets under his leadership.

The proxy advisor also recommended shareholders vote against the reelection of board member Kimbal Musk, Elon’s brother, while former 21st Century Fox CEO James Murdoch’s reelection was endorsed.

The ongoing debate over Musk’s pay package and the upcoming shareholder vote adds another layer of complexity to the already contentious relationship between Tesla’s board and its high-profile CEO.