As the next annual Tesla shareholders meeting looms, Elon Musk has made another attempt to sway the shareholder vote on his historic CEO pay package.
Tesla Factory Tour
Tesla CEO Elon Musk is now offering factory tours to at least 15 shareholders, in his latest bid to garner votes for his $56 billion at the next annual shareholders meeting on June 13.
Annual Shareholders Meeting Incoming
For several weeks now, Tesla shareholders have been voting on a number of significant proposals for the company, with the votes being finalized by the board at the next meeting.
$56 Billion Package
The most high-profile proposal is an enormous CEO compensation package, which would see Musk receive $56 billion dollars worth of stock options, making it the most valuable CEO pay package that any company has offered so far.
Struck Down in Delaware Court
But the package, which dates back to 2018, was struck down in a Delaware court after winning the shareholders vote six years ago.
Shareholders Criticize Musk
It has been heavily criticized by some shareholders who believe that Musk has not adequately prioritized the EV company and that his controversial public persona has been damaging to Tesla’s reputation.
Tactics to Win the Vote
Now, Musk and the board of directors are making a conspicuous public effort to push the upcoming vote through: including advertising campaigns, and now a personal tour of a Tesla factory.
Texas Gigafactory Tour
The newest initiative gives 15 lucky shareholders a chance to join a tour of the Tesla Gigafactory located in Austin, Texas hosted by Musk and EV designer Franz von Holzhausen.
Proof of Ownership and Vote
To go in the draw for a place on the factory tour and a reserved seat at the annual shareholders meeting, voters only need to submit proof of share ownership and proof that they voted.
“That You Voted, Not How You Voted”
“You should only submit proof that you voted, not how you voted,” the release reads. “You do not need to vote for or against any proposals to be eligible for entry.”
“Don’t Delay, Vote Today!”
Musk himself took to X to share the entry page for the tour, writing “Don’t delay, vote today!”
Tesla Pushing for a ‘Yes’
While any voting shareholder is eligible to join the tour regardless of how they voted, it seems clear that the company hopes to harness more ‘Yes’ votes for Musk by encouraging more shareholders who feel favorably toward the CEO to come forward.
Last-Ditch Effort
Nell Minow, the vice chair of corporate governance advisory ValueEdge Advisors described the newest push as a “last-ditch effort to try to charm retail investors.”
Not Changing Anybody’s Vote
“I think it just speaks to his grandiosity that he thinks that somehow being in his presence is going to have the results he wants,” Minnow added. “I don’t think he’s changing anybody’s vote from doing this.”
Shareholders Push Back
Despite the affirmative vote back in 2018, swathes of Tesla shareholders are now moving against the pay package.
NYC Pension Funds Letter
On May 20, New York City Comptroller Brad Lander sent out a letter to Tesla shareholders on behalf of several major NYC employee pension funds that were invested in Tesla. The letter encouraged shareholders to vote against the pay package.
Won’t Shift His Priorities
The letter argued that the pay package would not serve shareholders or the company, as it was unlikely to incentivize Musk to focus his time and priorities on Tesla while juggling commitments to social media platform X, his new AI startup xAI, SpaceX, and other companies he is involved with.
“An Abysmal Failure”
“If this was one of the primary reasons for the 2018 pay package, then it has been an abysmal failure, as six years later Musk’s outside business commitments have only increased,” the letter wrote.
Largest Pension Fund Refuses
The proposal was hit with another staggering blow on Wednesday, when America’s largest pension fund, the California Public Employee Retirement System (CalPERS) announced a plan to vote against the pay package.
“We Would Not Be Voting in Favor of That Proposal”
“As of today, minus the conversation that has yet to happen with Tesla, we would not be voting in favor of that proposal,” CEO Marcie Frost told CNBC. “We do not believe that the compensation is commensurate with the performance of the company.”
Three Proposals Put to Vote
The June 13 meeting will also conclude a vote on whether to incorporate Tesla into Texas, and a vote for the reelection of Kimbal Musk and James Murdoch to the Tesla Board of Directors.
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The content of this article is for informational purposes only and does not constitute or replace professional financial advice.
