Tesla's $1 Trillion Musk Pay Deal: Will Shareholders Say Yes or No?

Tesla, the famous electric car company, is facing a big decision at its annual general meeting. The main topic is whether Elon Musk, the CEO, should receive a pay package that could be worth one trillion dollars. Tesla has been working hard to convince shareholders that Musk deserves this reward. They have created digital ads and videos featuring board members praising Musk’s leadership, hoping to sway opinions before the vote. The meeting in Austin, Texas, is not just about money—it’s also about Musk himself, who has become a very controversial figure in recent years due to his political views and bold actions. Musk has even posted on his own social media platform, X, saying that the future of Tesla could affect the future of civilization. He has also shared messages from famous supporters like Michael Dell and Cathie Wood, and his brother Kimbal, who is on Tesla’s board, has publicly praised him.

However, not everyone is convinced that Musk should get such a huge pay package. Some critics, like Ross Gerber, a former major Tesla investor, argue that the company is spending too much time and money promoting Musk instead of focusing on selling electric vehicles. Gerber believes Tesla needs to return to its roots and concentrate on making and selling cars. The pay package itself is not a simple salary. Instead, Musk would have to achieve some very ambitious goals, like raising Tesla’s market value to $8. 5 trillion and getting a million self-driving 'Robotaxi' cars into operation. If he succeeds, he would receive 423. 7 million new shares, which could be worth nearly one trillion dollars. This isn’t the first time Musk’s pay has caused controversy. Previously, Tesla shareholders approved a pay deal worth tens of billions if Musk made the company ten times bigger, which he did. But a judge later said the deal was unfair because the board was too close to Musk. Now, the Supreme Court is reviewing that decision while Tesla pushes for an even bigger package.

Some experts say Tesla’s way of campaigning for Musk’s pay is unusual. Dorothy Lund, a law professor, says it’s rare for a company to run such a big campaign for a CEO’s compensation. Usually, boards are supposed to look out for shareholders, not just the CEO. Big advisory firms like Glass Lewis and ISS have told investors to vote against the pay package, saying it’s too much and would reduce the value of other shareholders’ investments. Major funds like Norway’s sovereign wealth fund and CalPERS have also said no. New York’s Comptroller has even called for rejecting some board members for not providing enough oversight. With big institutions against the deal, Musk may have to rely on regular investors, who often support him, to get the votes he needs. Meanwhile, protests against Musk and Tesla continue, and some experts think Musk’s actions have hurt the company’s reputation. Still, others believe Musk’s unique leadership and history of innovation make him worth betting on, even for such a huge amount. The big question now is whether Tesla’s shareholders will agree to give Musk the trillion dollar pay package.