Rejected: $56 Billion Salary Package for Tesla
A major investor has expressed opposition to the $56 billion compensation deal for Tesla CEO Elon Musk, as per a recent report. CalPERS, one of the top 30 investors in the electric vehicle manufacturer, currently owns 9.5 million shares of the automaker. The CEO of CalPERS, Marcie Frost, said, "We don't think the compensation is suitable for the company's performance." She made this statement during an interview with CNBC.
In response to Frost's statement, Musk expressed dissatisfaction, claiming that the US pension fund is not upholding the agreements. "She's making no sense. All the contractual milestones have been met," he wrote on the X social media platform. CalPERS has not yet responded to a request for comment from Reuters.
Musk's compensation package, worth the largest in American corporate history, does not include a salary or bonus. Instead, it consists of stock options that are granted when specific growth targets for Tesla are met. These targets were set in 2018, and since then, the value of the Tesla stock has nearly quadrupled.
The company intends to allow its shareholders to vote on the compensation package again, following a ruling by a Delaware judge earlier this year that invalidated it. The outcome of this vote will be revealed at Tesla's annual meeting on June 13th. It is anticipated that this vote is an indicator of Musk's leadership capabilities.
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The media report highlighted CalPERS' opposition to Elon Musk's $56 billion salary package from Tesla, citing it as unsuitable for the company's performance. Despite Musk asserting that all contractual milestones have been met and expressing dissatisfaction, Tesla is planning to present the compensation package for a vote again at its annual meeting.
Despite Tesla's official stance, the large dollar amount of Musk's compensation package, which is the largest in American corporate history, has stirred debate in the dollar-dominated financial world, with Tesla shares currently valued at almost four times their 2018 price, largely due to the performance-based stock options in Musk's compensation package.
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