Tesla shareholders advised to reject Elon Musk's ‘excessive' $56 billion pay package

Core Viewpoint - Proxy advisory firm Glass Lewis has recommended Tesla shareholders reject a proposed $56 billion pay package for CEO Elon Musk, citing concerns over its excessive size and potential dilution effects [1][2]. Group 1: Pay Package Details - The proposed pay package would be the largest for a CEO in corporate America, with no salary or cash bonus, and rewards tied to Tesla's market value reaching up to $650 billion over a 10-year period starting from 2018 [1]. - Tesla's current market valuation is approximately $571.6 billion, according to LSEG data [1]. Group 2: Criticism and Concerns - Glass Lewis criticized the pay package for its "excessive size" and the concentration of ownership, as well as Musk's involvement in multiple time-consuming projects, including his acquisition of Twitter [1]. - The advisory firm also expressed concerns regarding Tesla's proposed move of incorporation from Delaware to Texas, labeling it as offering "uncertain benefits and additional risk" to shareholders [2]. Group 3: Company Performance and Board Dynamics - Since Musk became CEO in 2008, Tesla has significantly improved its financial performance, achieving a profit of $15 billion compared to a $2.2 billion loss in 2018, and increasing vehicle production sevenfold [4]. - The Tesla board has faced scrutiny for its close ties to Musk, with Glass Lewis recommending shareholders vote against the reelection of board member Kimbal Musk, while supporting the reelection of James Murdoch [4].