Core Points - Elon Musk has been awarded a $1 trillion pay package, marking a first in global corporate history, which was approved by Tesla shareholders [1] - The pay package is designed to motivate Musk's performance with high targets for remuneration, but critics highlight potential loopholes that could allow him to benefit without fully meeting the goals [2][6] - The compensation plan includes 12 tiered grants of restricted stock, with market cap triggers starting at $2 trillion and operational milestones including sales targets and Ebitda tiers [3][4] Compensation Structure - Musk has a ten-year window to achieve the necessary targets to unlock the grants, receiving 35.312 million shares if he meets any one of the operational targets [4] - The operational milestones include sales targets for key products and Ebitda tiers starting at $50 billion and maxing at $400 billion [3] - Critics argue that the lower targets may be too easy to achieve, while the higher goals may be overly ambitious [4] Market Reaction and Implications - Despite criticism, Musk and some Wall Street analysts are optimistic about the pay package, citing a similar arrangement from 2018 that significantly boosted Tesla's share price [5] - The potential for Musk to profit without fully achieving the set targets raises questions about the fairness of the pay package and its implications for Tesla shareholders [6] - The coming years will determine whether this pay package will benefit or harm Tesla and its shareholders [6]

Core Viewpoint - Elon Musk criticized proxy advisory firms ISS and Glass Lewis, labeling them as "corporate terrorists" for their recommendations against his $1 trillion pay package, which he argues undermines his leadership at Tesla [1][2]. Group 1: Musk's Criticism of Advisory Firms - Musk expressed discomfort with the influence of proxy advisory firms, stating they lack understanding and have excessive sway over shareholder decisions, particularly affecting passive investors like index funds [2][3]. - He argued that these firms do not have actual ownership and often vote based on political lines rather than shareholder interests, which he sees as a significant issue beyond just Tesla [3]. Group 2: Pay Package Details - The proposed pay package for Musk could amount to approximately $1 trillion over 10 years, contingent on meeting performance metrics, including increasing Tesla's market cap by over 500% to $8.5 trillion [6]. - ISS and Glass Lewis raised concerns about the size of Musk's pay package and its potential to dilute existing shareholders' holdings [7]. Group 3: Advisory Firms' Role - Advisory firms like ISS and Glass Lewis do not vote directly in shareholder meetings but provide recommendations that are analyzed by major institutional investors such as BlackRock, Vanguard, and State Street [4]. - A spokesperson for Glass Lewis emphasized that their role is to provide analysis and recommendations, leaving the final decision to Tesla shareholders [5].

Core Insights - Tesla's board of directors approved the largest executive pay package in corporate history for Elon Musk, which is designed to align his compensation with ambitious performance targets [1] Group 1: Executive Compensation - The pay package is structured to incentivize Musk to achieve significant milestones, referred to as "Mars-shot milestones," which are expected to drive long-term growth for the company [1] - This decision aims to reassure investors about Musk's commitment to Tesla's future and performance [1]