Norway's sovereign wealth fund, the world's largest, has announced it will vote against a $1tn (£765bn) pay package for Tesla CEO Elon Musk at the company's annual shareholder meeting on Thursday. The fund, which is Tesla's seventh biggest single investor with a $17bn stake, expressed concerns over the award's size, dilution, and lack of mitigation of key person risk.
In a statement, Norges Bank said it appreciated the significant value created under Musk's leadership but would oppose the performance award. The package could make Musk the world's first trillionaire if Tesla's value rises from about $1tn to $8.5tn over the next decade, increasing his stake from nearly 16% to over 25%.
Tesla chair Robyn Denholm has argued the vote is essential to retain Musk, warning the company risks losing significant value if he leaves. However, two influential shareholder advisory groups, Glass Lewis and ISS, have recommended rejecting the deal, alongside some large pension funds including the American Federation of Teachers and CalPERS.
The Norwegian fund previously voted against Musk's $56bn pay package last year, which was approved by shareholders but later rejected by a Delaware court. Musk turned down an invitation to dinner from fund CEO Nicolai Tangen after that vote, according to a text exchange revealed by a freedom of information request.
Tesla faces challenges including falling sales globally, with vehicle deliveries down 13% in the first half of the year. Sales have dropped sharply in Europe, and shipments from its Shanghai factory declined 10% in October compared to last year.
