Elon Musk's $56 Billion Payday: Tesla Shareholders Cast Their Votes

Tesla faces a divisive decision on Musk's massive pay

by Zain ul Abedin
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Elon Musk's $56 Billion Payday: Tesla Shareholders Cast Their Votes
© Apu Gomes/Getty Images

In a high-stakes decision that has captured the attention of the financial and tech worlds alike, Tesla shareholders are currently voting on whether to reinstate CEO Elon Musk's colossal $56 billion pay package. This vote comes after a Delaware state judge earlier voided the compensation, ruling it had been improperly awarded.

The compensation debate isn't just a matter of figures; it's a profound test of investor confidence in Elon Musk, who has become a polarizing figure amid his controversial stances on various social issues. With Tesla's upcoming annual meeting in Austin, Texas, on June 13, nearly all Tesla stockholders, including major Wall Street entities and individual investors, have the chance to cast their vote online.

Tesla's Contentious Vote

The compensation package, originally approved in 2018, was flagged by the Delaware judge as illegal under state corporate laws, citing that the amount - 250 times the median of Elon Musk’s peers - was excessive.

Despite this, Tesla has launched an aggressive campaign to sway shareholders, employing tactics like advertisements and a dedicated website, which experts find unprecedented for debates on executive pay. Opponents of the package have also mobilized, with several investors issuing a public letter this month calling the compensation excessive and urging a "no" vote.

This collective action highlights the deep divisions within the shareholder community. It underscores the broader implications of the vote, which go beyond financial metrics to question Tesla's leadership's very governance and ethical stance.

As the deadline for online voting approaches on June 12, the outcome remains uncertain. The board's decision to potentially appeal the judge's ruling and relocate Tesla’s state of incorporation to Texas adds another layer of complexity to the ongoing saga.

This vote could ultimately influence not just Elon Musk's financial future but also Tesla's strategic direction amidst growing scrutiny over its governance practices.

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