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Elon Musk's Record Pay Package Approved by Shareholders

Jun 17, 2024 1 min read

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Tesla shareholders have approved a compensation package for CEO Elon Musk valued at $45 billion, making it the largest payout ever granted to a U.S. company CEO. This package includes significant milestones tied to increases in Tesla's market capitalization, pretax income, and revenue. Despite previous opposition and a court invalidation of the original $56 billion package, shareholders have reinstated Musk's pay plan, arguing that his leadership is instrumental in Tesla's success as a leading electric vehicle manufacturer.

In addition to approving Musk's compensation, shareholders also voted to move Tesla's legal registration from Delaware to Texas. This decision, along with the re-election of board members Kimbal Musk and James Murdoch, faced opposition from some large institutional investors and proxy firms. Furthermore, shareholders passed measures to increase investor control by shortening board terms to one year and lowering voting requirements for proposals to a simple majority.

The approval of Musk's compensation package comes amid a broader trend of rising CEO pay, with the 500 largest S&P companies experiencing the fastest growth in executive compensation in 14 years. Critics argue that such high levels of pay contribute to increasing social inequality, as the separation between the ultra-wealthy and the general population reaches record levels.

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