Elon Musk recently stirred the pot during Tesla’s earnings call when he spoke about his proposed $1 trillion pay package and the opposition he’s facing. Musk insists that the core issue isn’t really about the money—it’s about maintaining enough control over Tesla’s direction, especially its plans for AI, robotaxis, and humanoid robots.
He called investment firms ISS and Glass Lewis “corporate terrorists” for their influence on shareholder voting. Musk believes that he needs around a mid-20s percentage of voting power to ensure he can keep steering Tesla while still being held accountable if he makes reckless decisions.
In simpler terms, if shareholders back his package, Musk could see his stake in Tesla soar from 13% to nearly 29%. This would significantly increase his voting power. If they reject it, he hinted that he might step back from the company.
Musk’s proposal has drawn mixed reactions. Some, like investor Cathie Wood, believe it will pass. However, ISS and Glass Lewis have urged shareholders to vote against it. They assert that Musk’s plan is too lenient and gives him too much power without enough checks on his actions.
The debate over Musk’s compensation isn’t new. A judge previously invalidated a $56 billion plan from 2018, ruling that Musk had too much influence when it was approved. Tesla had to restore that deal through a shareholder vote last year, with critics questioning if Musk’s focus on AI and robotics distracts from Tesla’s core electric vehicle business.
Historical context shows that executive compensation plans often spark debate. In the 2000s, many companies faced backlash for paying their CEOs excessively while their stock prices struggled. Public sentiment can shift quickly, especially when larger economic factors are in play.
In recent years, concerns over corporate governance and executive pay have influenced shareholder activism. For instance, a 2023 survey found that 67% of investors believe executive pay should be tied directly to company performance.
As the November 6 vote approaches, it remains to be seen how shareholders will react. Elon Musk’s future at Tesla—and, by extension, the company’s direction—may depend on the outcome.
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