Norwegian wealth fund to vote against Elon Musk’s Tesla pay package

Norway’s sovereign wealth fund, managed by Norges Bank Investment Management, said it opposed Elon Musk’s hefty CEO pay package at Tesla’s annual meeting on Saturday.

It’s the latest setback over the size of the pay package, which was recently valued by the company at $44.9 billion but was worth about $56 billion in January. In May, two major shareholder advisory firms, ISS and Glass Lewis, recommended to vote against the package.

“While we appreciate the significant value generated under Mr. Musk’s leadership since the award date in 2018, we remain concerned about the overall size of the award, its structure given performance triggers, dilution and the lack of mitigation of key person risk,” says Norges. Bank Investment Management wrote this in a statement on its website. “We will continue to seek constructive dialogue with Tesla on these and other topics.”

Tesla asked shareholders to reinstate Musk’s pay package after it was rejected by a judge from Delaware this year.

The fund, called the Government Pension Fund Global, which has a 0.98% stake in Tesla worth $7.72 billion, initially voted against the package in 2018.

The fund invests the proceeds of the country’s oil and gas industry to secure pensions for future generations in Norway. It is worth 17.80 trillion Norwegian krone ($1.67 trillion). Due to its enormous size, the fund does not reinvest all its money in Norway, otherwise it would overheat the economy. It invests in 72 countries worldwide.

The fund also plans to vote in favor of a number of shareholder policies that management has recommended shareholders vote against, including a proposal to adopt a non-interference policy that respects freedom of association and collective bargaining; adopting a simple majority vote; releasing the board of directors; and publishing reports on efforts to prevent harassment and discrimination.