Proxy advisory firm Glass Lewis said on Saturday it has urged Tesla shareholders to reject a $56 billion pay package for Chief Executive Officer Elon Musk, which if passed can be the biggest pay package for a CEO in corporate America.
The report cited reasons just like the “excessive size” of the pay deal, the dilutive effect upon exercise and the concentration of ownership. It also mentioned Musk’s “slate of extraordinarily time-consuming projects” which have expanded along with his high-profile purchase of Twitter, now referred to as X.
The pay package was proposed by Tesla’s board of directors, which has repeatedly come under fire for its close ties with the billionaire. The package has no salary or money bonus and sets rewards based on Tesla’s market value rising to as much as $650 billion over the ten years from 2018. The corporate is currently valued at about $571.6 billion, in keeping with LSEG data.
In January, Judge Kathaleen McCormick of Delaware’s Court of Chancery voided the unique pay package. Musk then sought to maneuver Tesla’s state of incorporation to Texas from Delaware.
Glass Lewis also criticized the proposed move to Texas as offering “uncertain advantages and extra risk” to shareholders.
Tesla has urged shareholders to reaffirm their approval of the compensation.
In an interview this month, Tesla’s board chair Robyn Denholm told the Financial Times that Musk deserves the pay package because the corporate hit ambitious targets for revenue and its stock price.
Musk became Tesla CEO in 2008. Lately, he has helped improve results, taking the corporate to a $15 billion make the most of a $2.2 billion loss in 2018 and 7 times more vehicles have been produced, in keeping with a web based campaign website, Vote Tesla.
The proxy advisor also really helpful shareholders vote against the reelection of board member Kimbal Musk, the billionaire’ s brother while former twenty first Century Fox CEO James Murdoch re-election was really helpful.
