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The world’s largest sovereign wealth fund will vote against Tesla chief executive Elon Musk’s $1tn pay package, saying it is worried about the size of the deal.
Norway’s $2.1tn oil fund, which is a top-10 Tesla shareholder with a stake of 1.1 per cent, said on Tuesday that while it appreciated “the significant value created under Mr Musk’s visionary role” it would vote against his performance award.
“We are concerned about the total size of the award, dilution, and lack of mitigation of key person risk — consistent with our views on executive compensation,” it said two days before the electric-car maker’s annual meeting on November 6.
“We will continue to seek constructive dialogue with Tesla on this and other topics.”
Tesla chair Robyn Denholm has characterised the vote as essential to keeping Musk as the carmaker’s chief executive. Musk has publicly threatened to walk away if shareholders again block his pay package.
The oil fund last year voted against Musk receiving what was then the biggest remuneration package in US corporate history of $56bn.
That pay deal was approved by shareholders in June but rejected for a second time by a Delaware court in December.
Two shareholder advisory groups, Glass Lewis and ISS, have recommended that investors reject the latest $1tn pay deal, which is tied to ambitious milestones for share price and operational performance.
A group of big pension funds has also issued an open letter opposing the pay plan, arguing that the board’s “relentless pursuit” of keeping its chief executive had damaged Tesla’s reputation and led to excessive pay.
Norway’s oil fund has felt Musk’s wrath over pay before. Nicolai Tangen, the fund’s chief executive, invited Musk and other chief executives to dinner in Oslo earlier this year, but Musk turned the invite down after the oil fund voted against the $56bn pay deal.
“When I ask you for a favour which I very rarely do, and you decline, then you should not ask me for one until you’ve done something above nothing to make amends. Friends are as friends do,” Musk told Tangen in October 2024 in a text message revealed by the fund under a freedom of information request.
The Norwegian fund usually reveals its voting intentions five days before annual meetings. But it released its vote for Tesla only two days in advance, saying it wanted “to ensure all relevant information is available and able to be considered in our analysis”.
Musk talked about the criticism of the pay deal on X, the social media site he owns, last month. “Tesla is worth more than all other automotive companies combined. Which of those CEOs would you like to run Tesla? It won’t be me,” he wrote. He separately called ISS and Glass Lewis “corporate terrorists”.
The fortune of the world’s richest man is largely locked up in Tesla shares, which have more than tripled in value over the past five years as its market capitalisation has soared to $1.5tn.
Denholm told the Financial Times last month that if Tesla could not retain Musk “it wouldn’t be a good outcome for shareholders” but added that she did not believe he would do anything “sudden and detrimental” if Tesla lost the vote.
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