Take Back Tesla campaign urges shareholders to reject Musk $1 trillion pay plan

In a significant move ahead of Tesla's upcoming earnings report, a coalition of unions and corporate watchdogs is urging shareholders to reconsider a controversial pay package for CEO Elon Musk. Launched by groups including the American Federation of Teachers and Public Citizen, the 'Take Back Tesla' campaign aims to mobilize investors against a proposal that could grant Musk nearly $1 trillion in stock options, intensifying his control over the company. The board of Tesla introduced this unprecedented pay plan in September, asserting that it was essential to retain Musk's leadership for the next decade. However, critics of the proposal label it 'outrageous,' pointing to Musk's political engagements that they argue have distracted him from effectively leading the automaker. The campaign's website emphasizes that the plan does not mandate Musk to prioritize Tesla over his political and other business interests. The coalition encourages not only shareholders but also the general public to petition state treasurers and financial officials to oppose the plan. They are set to provide resources online to guide investors on how to vote their shares or influence fund managers. The site highlights the importance of public pension funds, which hold substantial shares in Tesla, urging them to demand accountability from Musk and the board. Additional organizations joining the campaign include Americans for Financial Reform, the Communication Workers of America, and corporate watchdog group Ekō, among others. Tesla has yet to respond to inquiries regarding the backlash against the pay structure. Notably, prestigious proxy advisory firms ISS and Glass Lewis have recommended against endorsing Musk's pay plan, echoing concerns raised during the previous contentious 2018 pay package, which was valued at around $56 billion in stock when it vested. Tesla, however, defended its record, arguing that shareholders who sold their stocks would have missed out on significant gains in market capitalization since 2018. The Delaware Court of Chancery previously ruled that the 2018 pay plan was improperly granted, citing a lack of transparency and Musk’s undue influence over board members during negotiations. Musk is currently appealing this decision in the Delaware State Supreme Court. As Tesla prepares to release its third-quarter results, New York City Comptroller Brad Lander, responsible for a $300 billion pension fund, has voiced strong opposition to the new pay plan. He argues that while Tesla has been a solid investment, the governance issues and Musk's inconsistent performance as CEO raise serious concerns. The stock has shown signs of recovery recently but continues to lag behind its tech counterparts, raising questions about the company's future direction under Musk's leadership.