Norges Bank Investment Management, which manages Norway’s Government Pension Fund Global, announced its voting decisions ahead of Tesla’s annual shareholder meeting.
The fund stated it would vote against Elon Musk’s “CEO Performance Award.”
Norway’s Sovereign Wealth Fund to Vote Against Elon Musk’s CEO Performance Award at Tesla Meeting
It acknowledged “the significant value created under Mr. Musk’s visionary role” but expressed concern over “the total size of the award.”
The decision aligns with the fund’s established “views on executive compensation.”
The fund argued that the award fails to address “key person risk,” meaning Tesla’s overreliance on one individual.
Norges Bank Investment Management added that it “will continue to seek constructive dialogue with Tesla on this and other topics.”
Tesla’s annual meeting is scheduled for Thursday, which the company’s board called a “critical inflection point” for its future.
The Norwegian Government Pension Fund Global owns a 1.14% stake in Tesla, valued at about $11.7 billion as of June.
This is not the first time the fund has opposed a Musk compensation plan.
In 2024, the fund voted against Musk’s previous $56 billion pay package.
The management explained that this vote was “consistent” with its opposition to the same award in 2018.
At that time, the fund said: “While we appreciate the significant value generated under Mr. Musk’s leadership since the grant date in 2018, we remain concerned about the total size of the award, the structure given performance triggers, dilution, and lack of mitigation of key person risk.”
Shareholders Urge Rejection of Musk’s Pay Plan, Accusing Tesla Board of Prioritizing CEO Over Company Reputation
In May, several Tesla shareholders and investor groups urged others to vote against Musk’s pay plan in an open letter. The letter accused Tesla’s board of damaging the company’s reputation in its “relentless pursuit of retaining” Musk.
It was signed by SOC Investment Group, the American Federation of Teachers, and the state treasurers of Nevada, New Mexico, Connecticut, Massachusetts, and Colorado, along with the comptrollers of Maryland and New York City.
The letter alleged that Tesla’s board “is made up of directors with close ties to the CEO.”
It also claimed the proposed pay package “provides so much discretion to Tesla’s Board that shareholders cannot be confident of impartial treatment.”
The letter further stated: “We believe that these relationships have enabled a culture where the Board consistently fails to challenge Mr. Musk, even when his actions are detrimental to the Company’s value and its public shareholders.”
In October, proxy advisor Institutional Shareholder Services (ISS) also recommended voting against the pay package.
ISS argued that while the award’s goal is to retain Musk and secure his focus on Tesla, “there are no explicit requirements to ensure that this will be the case.”
On Tuesday morning, Tesla’s share price fell around 2.61% in premarket trading, to $456.18.
The Tesla board had outlined Musk’s proposed compensation in an SEC filing from September.
The plan would grant Musk an additional 12% stake in Tesla, divided into 12 tranches over 10 years, based on meeting certain performance goals.
This proposal aligns with Musk’s earlier demand for a 25% voting interest in the company, after he reportedly threatened to leave Tesla to focus on other ventures.
To receive the full reward, Musk must raise Tesla’s market capitalization from approximately $1.47 trillion to $8.5 trillion within ten years.
