Within mere hours, Tesla’s community of shareholders stands on the verge of an extraordinary decision—one that will determine the outcome of CEO Elon Musk’s unprecedented $1 trillion compensation proposal. This pivotal moment coincides with the company’s highly anticipated annual shareholder assembly, which is scheduled to commence Thursday afternoon at precisely 4 p.m. Eastern Time at Tesla’s expansive headquarters in Austin, Texas. Attendance at the event has been strictly limited, with only a select group of investors invited to participate in person, highlighting both the exclusivity and importance of the proceedings.
During the meeting, Tesla’s investors will cast their votes on a series of significant proposals that could shape the future direction of the company. The central and most contentious issue is Musk’s massive pay package, whose approval or rejection will signal how much confidence shareholders truly place in his leadership. In addition to this headline item, participants will consider other initiatives, such as the possibility of Tesla directing capital into Musk’s separate artificial intelligence startup, xAI—an idea that underscores the deepening intersection between Tesla’s automotive focus and emerging AI technologies. Shareholders will also deliberate over a motion to allocate portions of Tesla’s share reserves to attract and retain exceptional employees, a move tied closely to corporate competitiveness in Silicon Valley’s fiercely contested talent market. Furthermore, the meeting will revisit Tesla’s previous 2018 compensation plan for Musk, whose legal validity remains disputed after a court decision overturned it, leaving 208 million shares in limbo to “address the uncertainty” surrounding that case.
The newly proposed compensation structure, monumental in scale and ambition, binds Musk’s potential earnings to a set of bold performance milestones extending through 2035. To fully realize the plan’s estimated $1 trillion value, he must propel Tesla’s market capitalization to an extraordinary $8.5 trillion—a figure that would set new benchmarks in corporate valuation. Additionally, Tesla must achieve annual sales of 12 million vehicles, demonstrating global dominance in electric transportation, while deploying both one million autonomous robotaxis and a matching number of humanoid robots. These targets reflect Tesla’s dual aspiration: to revolutionize mobility and artificial intelligence simultaneously, solidifying its position at the cutting edge of both industries.
Yet despite the scale of Tesla’s ambition, the compensation package has stirred intense controversy across the business and investment community. Weeks before the decisive vote, two influential proxy advisory firms—Institutional Shareholder Services (ISS) and Glass Lewis—publicly recommended that shareholders oppose the plan. Their objections centered on concerns about governance, proportionality, and the risk of excessive concentration of power in a single executive. The scrutiny intensified further when, on Tuesday, Norges Bank Investment Management—the entity responsible for overseeing Norway’s $2 trillion sovereign wealth fund—announced that it had already voted against the proposal. As Tesla’s sixth-largest institutional stakeholder and the world’s largest sovereign investor, its dissent is particularly consequential. The fund cited apprehensions about Tesla’s overreliance on Musk’s leadership and the absence of strong safeguards against what it described as “key person risk,” meaning the potential instability that could arise if Musk were to depart or become unable to fulfill his role.
Musk, characteristically outspoken, responded forcefully to his critics. During Tesla’s most recent earnings call, he accused the proxy advisory firms of acting as “corporate terrorists,” suggesting that their recommendations threatened not only his compensation but the company’s strategic freedom. Tesla’s board chair, Robyn Denholm, in a letter circulated to shareholders last October, similarly urged investors to support the compensation plan, warning that Musk’s withdrawal from Tesla remained a genuine possibility if the proposal were rejected. Her message underscored the board’s belief that retaining Musk’s vision and leadership is vital to sustaining Tesla’s momentum in a fast-changing technological landscape.
While Tesla’s stock price has rebounded considerably from an earlier slump this year, the company continues to face significant headwinds. The expiration of U.S. electric vehicle tax credits has clouded near-term demand prospects, and the intensifying competition from both established automakers and emerging EV startups adds further uncertainty to its growth trajectory. Against this complex backdrop, the shareholder vote is more than a matter of executive pay—it is a referendum on Tesla’s future strategic direction, investor confidence, and the delicate balance between visionary ambition and prudent corporate governance. The decisions made in Austin will not only define the next chapter of Tesla’s evolution but may also serve as a global test case for the limits of performance-based compensation in the modern era of innovation-driven capitalism.
Sourse: https://www.businessinsider.com/tesla-shareholder-meeting-elon-musk-pay-package-vote-live-updates-2025-11
