- Tesla shareholders approved Elon Musk’s $56 billion pay package.
- The package faced opposition from some institutional investors but was supported by many small investors.
- The pay package is based on a performance plan with ambitious targets.
In a major win for Elon Musk, Tesla shareholders have approved his $56 billion pay package. The decision, announced at a shareholder meeting in Austin, Texas, saw strong support from small investors, despite opposition from some major institutional investors. “We have the most awesome shareholder base,” Musk said, expressing his gratitude to the cheering crowd at the Tesla factory.
This approval comes after a Delaware judge voided the pay package in January, citing flaws in the original approval process. Musk actively campaigned for its reinstatement, leveraging social media and engaging directly with small investors. About 90% of retail investors who voted supported the package, highlighting Musk’s unique ability to rally his supporters.
The $56 billion pay package is based on a ten-year performance plan, with Musk receiving stock options upon achieving ambitious milestones. These include market capitalization, earnings, and revenue targets. Since 2020, Tesla has surpassed many of these targets, with its market capitalization soaring past $650 billion and consistently exceeding earnings expectations.
Despite the approval, Musk still faces legal challenges in Delaware, where the Tesla board was previously characterized as “beholden” to him. Nevertheless, this decisive vote underscores the loyalty of Tesla’s small investors and their belief in Musk’s vision for the company’s future.
