Tesla’s board chair, Robyn Denholm, recently issued a letter to shareholders urging the importance of maintaining a compensation plan that incentivizes CEO Elon Musk. Denholm emphasized that without such a plan, there is a risk Musk might leave his executive role, a move that could deprive Tesla of his critical contributions and vision, which have been pivotal in generating substantial returns for shareholders.

Adding to the conversation, Drew Hambly, the global public equity investment director for a prominent fund, cautioned that concentrating too much power in the hands of a single shareholder could be risky.

Meanwhile, Norges Bank Investment Management expressed its concerns in a statement, acknowledging the immense value Musk brings to Tesla. However, they voiced apprehension over the sheer size of his compensation package, potential dilution, and the absence of measures to mitigate the risk associated with the dependency on a single key figure.

For Musk to fully capitalize on the proposed pay package, he will need to meet a series of ambitious targets, underscoring the challenging nature of the compensation plan.

Musk ‘worth’ the $1 trillion pay packet

“He will have to hit many aggressive goal posts to get the pay package.”