Elon Musk, Chief Executive Officer of SpaceX and Tesla and owner of X looks on during the Milken Conference 2024 Global Conference Sessions at The Beverly Hilton in Beverly Hills, California, US, May 6, 2024.Tesla shareholders approved CEO Elon Musk's US$56 billion pay package, the electric vehicle-maker said on Thursday , a big thumbs-up to his leadership and an enticement for keeping his focus on his biggest source of wealth.
"You need to look at the votes that the directors got. If people really think there needs to be a check and the board isn't doing its job, that's where they'll vote.""The vote by Tesla shareholders to reinstate Elon Musk's compensation package should give Tesla the legal ammunition it needs to have the court officially reinstate it.
"By the vote, shareholders once again endorsed the terms of the contract, sending a strong signal that "a deal is a deal" and Musk deserves to be rewarded for meeting the lofty thresholds of an entirely incentive-based contract. The legal battle over the compensation plan is far from over, but we think the vote greatly strengthens Tesla's case.
The below quotes were prior to the vote but after Musk on Wednesday posted on his social media platform X that the resolution had strong support:"Elon Musk and Chair Denholm have made this about CEO loyalty and presented the votes as a decision about whether the company can keep Musk. That is a lot of pressure but it doesn't change the fact that good governance is good for the bottom line of a company, and the Tesla board is consistently and clearly deficient on that front.
The logical explanation is that it means Musk is no longer a flight risk, should the deal be approved. Pay him well and he'll stay to oversee Tesla's ongoing efforts to be crowned king of the electric vehicle sector.""Elon's tweet is more evidence of the failure of corporate governance at Tesla — this is not how or when shareholder votes are supposed to be made public."
"Additionally, instead of continuing to try to defend it in court, the board should hire a compensation consultant, and renegotiate Musk's incentive plan so that it is appropriate and not dilutive to shareholders."
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