Glass Lewis, a proxy advisory firm, said on Saturday that it has advised Tesla shareholders to turn down a $56 billion dollar pay package for CEO Elon Musk.
This would be the largest pay package for a CEO in corporate America. The report cited reasons like the pay deal being too large, the dilutive effect on shares, and Musk’s many time-consuming projects.
Musk recently bought Twitter and renamed it X.
The pay package was proposed by Tesla’s board of directors. They have been criticized for being too close to the billionaire.
The package has no salary or cash bonus. Musk would get rewards if Tesla’s market value rises to $650 billion over the next 10 years. Tesla is currently worth $571.6 billion dollar.
In January, a judge voided the original pay package. Musk then tried to move Tesla’s state of incorporation to Texas.
Glass Lewis thinks this move has risks and few benefits for shareholders.
Tesla wants shareholders to approve the compensation again. Robyn Denholm, Tesla’s board chair, thinks Musk earned the pay package.
He helped Tesla make more money and produce more vehicles.
Musk became Tesla CEO in 2008. Since then, he has made Tesla profitable and increased vehicle production.
Glass Lewis also thinks shareholders should vote against Kimbal Musk’s re-election to the board. They recommend re-electing James Murdoch instead, a former CEO.
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