Under the leadership of Elon Musk, Tesla has become a major player in the electric vehicle market and has achieved significant success, making it the most valuable auto company globally. Despite Mr. Musk’s success in generating profits for investors and becoming a billionaire multiple times over, Tesla shareholders are now questioning whether he deserves his $45 billion payday.
The upcoming vote by investors will determine whether Mr. Musk’s compensation package, which consists of stock options, should be upheld or not. This package is a significant portion of his wealth and has contributed to his status as one of the wealthiest individuals globally, with a net worth exceeding $200 billion. If the compensation package is rejected, Mr. Musk may fall behind other billionaires like Jeff Bezos.
Initially approved by shareholders in 2018, the compensation package is being voted on again due to a court ruling in Delaware that voided the agreement earlier this year. The court ruled that Mr. Musk had too much influence over the terms of the package, as the board of directors consisted of individuals close to him, including friends, those who have benefited financially from him, and even his brother.
The Tesla board is urging shareholders to ratify the package once more in the hopes of overturning the court’s decision. To receive the full benefits of the options, Tesla’s sales, profits, and market value had to reach unprecedented levels back in 2018, a feat that many investors believe Mr. Musk has delivered on and therefore deserves the compensation.
The vote on Thursday will be crucial in determining the future of Mr. Musk’s payday and will serve as a test of the limits of executive pay and the oversight of wealthy individuals in Silicon Valley. It remains to be seen whether Tesla investors will support Mr. Musk’s massive payday or if they will push back against what some see as excessive compensation for a single individual in the business world.