Street Calls of the Week
Investing.com -- Tesla has criticized Institutional Shareholder Services (ISS) for recommending against CEO Elon Musk’s proposed $1 trillion compensation plan, calling the proxy adviser "disconnected from reality."
In a post on X, Tesla defended the compensation package that shareholders have previously approved twice, stating that "Elon receives nothing unless shareholders win big." The company also defended board member Ira Ehrenpreis, whom ISS recommended voting against, noting he has "created a governance framework that has allowed Tesla to achieve an astonishing TSR increase of ~39,000%" during his tenure as Tesla’s longest-serving independent director.
This marks the second consecutive year ISS has urged shareholders to vote against Musk’s pay package. In its Friday report, ISS cited "unmitigated concerns" about the plan’s magnitude and design.
The proposed compensation package aims to incentivize Musk to remain engaged with Tesla over the next decade. To receive the full payout and additional voting control, Musk must reach several ambitious goals, including growing Tesla’s market value to at least $8.5 trillion and expanding its car, robotics, and robotaxi businesses.
If approved, the additional shares would increase Musk’s holdings in the electric vehicle maker to at least 25%. Musk has threatened to develop products outside Tesla if he cannot increase his equity stake in the company.
Tesla shareholders will vote on the compensation package at the annual meeting scheduled for November 6. The company urged shareholders to "Vote with Tesla on ALL proposals."
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