Big Fund Says No to Musk Pay, Musk Says ‘Shame on Them’

Big Fund Says No to Musk Pay, Musk Says ‘Shame on Them’

Will the CEO pay package be approved or not is a key question for


investors who wonder what’s next for shares of the electric-vehicle maker.

Everyone is weighing in with an opinion, which isn’t making it easier to figure out what will happen to Tesla shares in the coming weeks.

Shareholders are being asked to reinstate Elon Musk’s 2018 pay package worth some $56 billion at the time. In January, a Delaware judge voided the package, citing inadequate disclosure for investors voting on the compensation.

California Public Employees’ Retirement System CEO Marcie Frost told CNBC on Wednesday that her public pension—the largest in the U.S. by assets—would vote against the proposal. Calpers owns a $1.67 billion stake in Tesla, making it one of the company’s top 25 shareholders, according to FactSet.

The comments irked Musk, who tweeted on Wednesday “Shame on them, they have no honor.”

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The potential Calpers no vote came as proxy advisor Egan-Jones recommended that shareholders vote yes and reinstate Musk’s massive pay package.

“Egan-Jones believes the continuation of this compensation plan is critical for maintaining Musk’s leadership and motivation, which are essential for Tesla’s sustained growth and innovation,” reads part of the recommendation released Wednesday. “The firm acknowledges the high compensation level but emphasizes the exceptional performance and unique contributions of Musk to Tesla’s success.”

Tesla stock has added some $500 billion in market value since the 2018 award, becoming the world’s most valuable car company. Tesla delivered about 255,000 all-electric vehicles in 2018. It delivered about 1.8 million in 2023.

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Still, tens of billions of dollars is a lot to pay any executive. Over the weekend, proxy advisory firm Glass Lewis recommended shareholders vote no, which was also its recommendation in 2018. But four years ago, the package passed with greater than 70% support from shareholders before being squashed by the Delaware judge.

The vote might be closer this time, but Wall Street believes it will pass muster. “A yes vote is in the cards so Tesla shareholders can move on from this Delaware disaster,” says Wedbush analyst Dan Ives. “The Musk 2018 Compensation issue has been an overhang on the stock and we believe [on] June 13 this finally gets resolved.”

If shareholders vote no, investors can expect some volatility in Tesla stock. The board would be forced back to the drawing board, designing a new compensation package for Musk. A no vote would also fan fears that Musk would take artificial-intelligence projects outside of Tesla.

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Tesla uses AI to train its autonomous-driving technology, which investors expect to create truly self-driving cars. Musk believes other auto makers will license Tesla’s technology, creating another source of profits for his auto company.

Earlier this year, Musk said that 25% voting control in Tesla stock would make him more comfortable keeping AI projects inside Tesla. Including the 2018 pay package, Musk controls about 20% of Tesla stock.

(Musk also controls his AI company called xAI.)

Tesla shares were up 0.2% in early trading at $176.55, while

S&P 500


Nasdaq Composite

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futures were both down about 0.6%.

Through Wednesday trading, shares were down about 29% year to date, underperforming the S&P 500 by about 39 percentage points. Slowing growth in EV sales has weighed on investor sentiment.

Tesla delivered about 387,000 EVs in the first quarter of 2024, down almost 9% year over year.

Write to Al Root at

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