New York
CNN
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Two influential advisory corporations have urged shareholders to vote towards Elon Musk’s contentious $51 billion pay bundle and raised issues in regards to the CEO’s quite a few aspect tasks.
On Friday, Institutional Shareholder Providers referred to as the bundle “extreme” and famous that shareholder issues “haven’t been sufficiently mitigated” for the reason that bundle was first authorised in 2018.
Whereas recognizing Tesla’s progress and profitability, ISS mentioned Musk’s pay bundle — first authorised in 2018 and thrown out by a judge in January — “was thought-about outsized from the beginning” and has “failed to perform sure of the board’s said aims,” together with focusing Musk “extra carefully on the Tesla group, versus his different companies.”
That warning got here a couple of days after Glass Lewis, one other outstanding advisory agency, printed a 71-page report that criticized the scale of the compensation plan and warned about Musk’s “slate of terribly time-consuming tasks” which are unrelated to Tesla, similar to X, the corporate previously generally known as Twitter.
Musk pushed again towards the Glass Lewis report on Wednesday, telling shareholders in a letter that the agency “omits key issues, makes use of defective logic, and depends on hypothesis and hypotheticals.” The letter urges shareholders to approve the pay bundle in addition to the board’s proposal to formally transfer Tesla’s headquarters to Texas from Delaware.
The transfer to Texas, the place Musk additionally operates SpaceX, was proposed shortly after a Delaware Chancery Court docket choose sided with Tesla shareholders who challenged the legality of the 2018 pay bundle.
These shareholders additionally argued that the administrators on Tesla’s board weren’t really unbiased and have been too near Musk to guard shareholders’ pursuits.
The board is placing the identical 2018 bundle up for a revote at Tesla’s annual shareholder assembly on June 13.