Elon Musk’s Tesla pay package assailed by shareholder group

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A shareholder group is criticizing Elon Musk’s $56 billion pay package and urging Tesla shareholders to vote against it, as well as the reelection of board directors Kimbal Musk and James Murdoch. The group argues that Musk’s pay does not benefit Tesla shareholders and is excessive. In addition to the CEO package, shareholders will also vote on the company’s re-incorporation in Texas and the reelection of the two board members.
The company has scheduled a meeting for June 13 and has taken the unusual step of launching a website to encourage shareholders to vote in favor of its proposals. In addition, Tesla has released a video urging the passage of these proposals.

The letter signed on Monday includes notable names such as Amalgamated Bank, Danish pension fund AkademikerPension, Nordea Asset Management, United Church Funds, and New York City Comptroller Brad Lander.

The letter also criticizes Tesla’s board, stating that their failure to control Elon Musk’s actions puts the Tesla brand at risk. It mentions Musk’s public disputes with regulators, his acquisition of Twitter, controversial statements on X, as well as his legal and personal issues in recent years.
According to reports, the continuous negative media coverage surrounding Elon Musk has resulted in a decline in Tesla’s reputation among consumers. This, in turn, is having a negative impact on the company’s financial performance.

There are concerns about a significant governance failure within Tesla that requires immediate attention and action. It is deemed crucial to reject the reelection of Kimbal Musk, who is Elon Musk’s brother, and James Murdoch.

Although Tesla shares have experienced a 23% rally in the past month, they are still down approximately 30% for the year. This contrasts with the S&P 500’s 11% gain in the same period.