The California Public Employees' Retirement System (CalPERS), one of the largest pension funds in the United States and a significant shareholder in Tesla, has announced its intention to vote against CEO Elon Musk's USD 56 billion compensation package at the upcoming annual shareholder meeting. CalPERS, which holds 9.5 million Tesla shares and is among the top 30 investors in the electric vehicle manufacturer, previously voted against Musk's stock options package in 2018.

The decision by CalPERS comes at a critical time for Tesla, as the company faces the possibility of its first annual sales decline and a nearly 28% drop in its share price since the beginning of the year. The shareholder meeting on Thursday is expected to serve as a test of Musk's leadership, particularly as he shifts focus towards self-driving technology.

Marcie Frost, the CEO of CalPERS, expressed concerns about the concentration of such a large award on a single individual and the potential impact on other shareholders. "We also raise questions about concentrating a large award on a single individual and (the) way it would strengthen the shares of Mr. Musk at the expense of diluting the value of those belonging to other shareholders," Frost stated.

In contrast to CalPERS, the Florida State Board of Administration, which holds 2.89 million Tesla shares and is the company's 80th largest investor, voted in support of Musk's USD 56 billion pay package. The Florida pension board cited the plan's "very high levels of pay-for-performance" as the reason for their support. However, the agency also voted against the re-election of Tesla director Kimbal Musk, citing independence concerns, and opposed Tesla's proposed re-domestication to Texas.

The divergent opinions among Tesla's shareholders highlight the ongoing debate surrounding Musk's compensation and leadership. In January, a Delaware judge rejected the record compensation package, calling it "an unfathomable sum" that was unfair to shareholders, despite their approval of the pay in 2018.

As Tesla faces increasing competition in the electric vehicle market and the challenges of expanding its self-driving technology, the outcome of the shareholder meeting and the vote on Musk's compensation package will be closely watched by investors and industry observers alike. The decision by CalPERS to oppose the pay package may influence other institutional investors and put additional pressure on Musk and the Tesla board to address shareholder concerns.

The shareholder meeting also comes at a time when Musk is facing increased scrutiny over his management of Twitter, which he acquired in a USD 44 billion deal last year. Some investors have questioned whether Musk's focus on Twitter has detracted from his responsibilities at Tesla, contributing to the company's recent stock price decline.

As the electric vehicle industry continues to evolve and competition intensifies, Tesla will need to navigate the challenges of maintaining its market leadership while addressing shareholder concerns and ensuring the company's long-term success. The outcome of the shareholder meeting and the vote on Musk's compensation package will provide important insights into the future direction of the company and the confidence of its investors in Musk's leadership.

The California Public Employees' Retirement System (CalPERS), one of the largest pension funds in the United States and a significant shareholder in Tesla, has announced its intention to vote against CEO Elon Musk's USD 56 billion compensation package at the upcoming annual shareholder meeting.

The California Public Employees' Retirement System (CalPERS), one of the largest pension funds in the United States and a significant shareholder in Tesla, has announced its intention to vote against CEO Elon Musk's USD 56 billion compensation package at the upcoming annual shareholder meeting. CalPERS, which holds 9.5 million Tesla shares and is among the top 30 investors in the electric vehicle manufacturer, previously voted against Musk's stock options package in 2018. The decision by CalPERS comes at a critical time for Tesla, as the company faces the possibility of its first annual sales decline and a nearly 28% drop in its share price since the beginning of the year. The shareholder meeting on Thursday is expected to serve as a test of Musk's leadership, particularly as he shifts focus towards self-driving technology. Marcie Frost, the CEO of CalPERS, expressed concerns about the concentration of such a large award on a single individual and the potential impact on other shareholders. "We also raise questions about concentrating a large award on a single individual and (the) way it would strengthen the shares of Mr. Musk at the expense of diluting the value of those belonging to other shareholders," Frost stated. In contrast to CalPERS, the Florida State Board of Administration, which holds 2.89 million Tesla shares and is the company's 80th largest investor, voted in support of Musk's USD 56 billion pay package. The Florida pension board cited the plan's "very high levels of pay-for-performance" as the reason for their support. However, the agency also voted against the re-election of Tesla director Kimbal Musk, citing independence concerns, and opposed Tesla's proposed re-domestication to Texas. The divergent opinions among Tesla's shareholders highlight the ongoing debate surrounding Musk's compensation and leadership. In January, a Delaware judge rejected the record compensation package, calling it "an unfathomable sum" that was unfair to shareholders, despite their approval of the pay in 2018. As Tesla faces increasing competition in the electric vehicle market and the challenges of expanding its self-driving technology, the outcome of the shareholder meeting and the vote on Musk's compensation package will be closely watched by investors and industry observers alike. The decision by CalPERS to oppose the pay package may influence other institutional investors and put additional pressure on Musk and the Tesla board to address shareholder concerns. The shareholder meeting also comes at a time when Musk is facing increased scrutiny over his management of Twitter, which he acquired in a USD 44 billion deal last year. Some investors have questioned whether Musk's focus on Twitter has detracted from his responsibilities at Tesla, contributing to the company's recent stock price decline. As the electric vehicle industry continues to evolve and competition intensifies, Tesla will need to navigate the challenges of maintaining its market leadership while addressing shareholder concerns and ensuring the company's long-term success. The outcome of the shareholder meeting and the vote on Musk's compensation package will provide important insights into the future direction of the company and the confidence of its investors in Musk's leadership.

CalPERS opposes Musk's USD 56 billion pay package

The California Public Employees' Retirement System (CalPERS) has announced its opposition to Tesla CEO Elon Musk's $56 billion pay package, citing concerns about its alignment with the company's performance. <o:p></o:p>

CalPERS CEO Marcie Frost stated in an interview with CNBC, "We do not believe that the compensation is commensurate with the performance of the company."<o:p></o:p>

CalPERS, one of Tesla's top 30 investors, holds 9.5 million shares of the electric vehicle manufacturer. <o:p></o:p>

The pension fund's stance adds significant weight to the ongoing debate over Musk's compensation, which has faced scrutiny from various quarters. <o:p></o:p>

Elon Musk responded to CalPERS' opposition on social media platform X, formerly known as Twitter, asserting that the pension fund's position was unfounded. <o:p></o:p>

He argued that all contractual milestones of the pay package were met and accused CalPERS of reneging on their agreement. <o:p></o:p>

"What she's saying makes no sense, as all the contractual milestones were met. CalPERS is breaking their word," Musk wrote.<o:p></o:p>

The controversy around Musk's pay package is not new. <o:p></o:p>

Proxy advisory firm Glass Lewis recently urged Tesla shareholders to reject the compensation plan, highlighting its disconnect from the company’s actual performance. <o:p></o:p>

In a rebuttal, Tesla underlined Musk's role in creating wealth for its stockholders, pointing out his significant personal investment in the company.<o:p></o:p>

Musk's pay package, the largest in corporate America, eschews a traditional salary or cash bonus. <o:p></o:p>

Instead, it ties rewards to Tesla's market value, which is expected to rise to $650 billion within a decade from its inception in 2018. <o:p></o:p>

However, a Delaware judge dismissed the package in January, calling it "an unfathomable sum" that was unfair to shareholders.<o:p></o:p>

In April, Tesla sought reaffirmation from its shareholders for Musk’s compensation plan, initially set in 2018. <o:p></o:p>

Adding to the divide among advisory firms, Egan-Jones Proxy Services recommended that investors support the pay package. <o:p></o:p>

The firm noted that maintaining Musk's leadership and motivation is crucial for Tesla’s sustained growth and innovation. <o:p></o:p>

"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," an Egan-Jones manager stated in an email.<o:p></o:p>

Egan-Jones also supported Tesla's proposal to shift its state of incorporation from Delaware to Texas, suggesting that the move could enhance operational efficiency and corporate culture by aligning legal and operational bases.<o:p></o:p>

(With inputs from Reuters)<o:p></o:p>

The California Public Employees' Retirement System (CalPERS) has announced its opposition to Tesla CEO Elon Musk's $56 billion pay package, citing concerns about its alignment with the company's performance.

The California Public Employees' Retirement System (CalPERS) has announced its opposition to Tesla CEO Elon Musk's $56 billion pay package, citing concerns about its alignment with the company's performance. CalPERS CEO Marcie Frost stated in an interview with CNBC, "We do not believe that the compensation is commensurate with the performance of the company." CalPERS, one of Tesla's top 30 investors, holds 9.5 million shares of the electric vehicle manufacturer. The pension fund's stance adds significant weight to the ongoing debate over Musk's compensation, which has faced scrutiny from various quarters. Elon Musk responded to CalPERS' opposition on social media platform X, formerly known as Twitter, asserting that the pension fund's position was unfounded. He argued that all contractual milestones of the pay package were met and accused CalPERS of reneging on their agreement. "What she's saying makes no sense, as all the contractual milestones were met. CalPERS is breaking their word," Musk wrote. The controversy around Musk's pay package is not new. Proxy advisory firm Glass Lewis recently urged Tesla shareholders to reject the compensation plan, highlighting its disconnect from the company’s actual performance. In a rebuttal, Tesla underlined Musk's role in creating wealth for its stockholders, pointing out his significant personal investment in the company. Musk's pay package, the largest in corporate America, eschews a traditional salary or cash bonus. Instead, it ties rewards to Tesla's market value, which is expected to rise to $650 billion within a decade from its inception in 2018. However, a Delaware judge dismissed the package in January, calling it "an unfathomable sum" that was unfair to shareholders. In April, Tesla sought reaffirmation from its shareholders for Musk’s compensation plan, initially set in 2018. Adding to the divide among advisory firms, Egan-Jones Proxy Services recommended that investors support the pay package. The firm noted that maintaining Musk's leadership and motivation is crucial for Tesla’s sustained growth and innovation. "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," an Egan-Jones manager stated in an email. Egan-Jones also supported Tesla's proposal to shift its state of incorporation from Delaware to Texas, suggesting that the move could enhance operational efficiency and corporate culture by aligning legal and operational bases. (With inputs from Reuters)

CalPERS opposes Elon Musk's $56 billion pay package amid shareholder discontent

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