Tesla shareholders are deciding the future of CEO Elon Musk’s massive pay package in a vote on Thursday, June 13.
As per multiple outlets, shares of Tesla rose after the company revealed that shareholders are largely in favor of approving Musk’s compensation, valued at around $44.9 billion.
This follows a Delaware judge’s decision to reject the pay package, saying Tesla misled shareholders when it was approved in 2018.
Tesla is voting to approve Musk's pay package and move its legal home from Delaware to Texas.
The final results of the vote will be announced at Tesla’s annual shareholders meeting in Austin, Texas.
However, shareholders can still vote online or in person on Thursday.
Meanwhile, Musk's social media posts on X (formerly Twitter) indicated that shareholders support his compensation package.
However, legal experts warn that releasing vote totals while voting is still ongoing could cause problems for Tesla and attract scrutiny from the U.S. Securities and Exchange Commission (SEC).
In 2018, 73% of shareholders approved Musk’s pay package, but the Delaware judge ruled that Musk is not entitled to it because Tesla’s board was controlled by him.
Institutional investors like California’s State Teachers Retirement System and advisory firms ISS and Glass Lewis have recommended voting against the package due to its size and concerns about profitability.
Meanwhile, Tesla and Musk have campaigned to gain approval for the pay package through posts on social media, TV appearances, and SEC filings.
Moreover, if the pay package is approved, Musk is expected to stay at Tesla, focusing on electric vehicles, AI, and robotics.
If not approved, Musk could pursue AI research with one of his other companies or leave Tesla altogether.
