'Ssamyeonchoga' Musk... Norwegian Sovereign Wealth Fund Also Opposes 'Tens of Trillions Won Compensation Plan'

Tesla's 8th Largest Shareholder NBIM
Criticizes Excessive Compensation and Share Dilution
Vote Showdown Expected at Tesla's AGM on the 13th

Norway's sovereign wealth fund, a major shareholder of Tesla, has expressed opposition to the compensation package for Tesla CEO Elon Musk. Musk, who needs to prove that Tesla shareholders support his compensation plan, is now facing a crisis.

According to major foreign media including the Associated Press on the 9th (local time), Norges Bank Investment Management (NBIM), the asset manager of Norway's sovereign wealth fund, announced in a statement the previous day that it would vote against the compensation package for CEO Musk at Tesla's shareholder meeting scheduled for the 13th. NBIM explained the reasons for its opposition, stating, "We highly value the value created by CEO Musk since 2018," but expressed concerns about "the total size of the compensation, equity dilution, and unresolved risks faced by key persons in the company."

[Image source=Getty Images Yonhap News]

NBIM is one of the world's largest sovereign wealth funds with nearly $1.7 trillion in assets under management and was Tesla's 8th largest shareholder as of the end of last year, holding a 0.98% stake (approximately $7.7 billion). Owning 1.5% of the world's publicly traded stocks, NBIM reportedly voted against more than half of U.S. CEO pay packages last year, arguing that they do not align with long-term value creation for shareholders, including over $20 million in CEO salaries in the U.S.

On the same day, CEO Musk criticized NBIM's decision on his social media platform X (formerly Twitter), saying, "(NBIM's decision is) not cool," and added, "If you actually survey the shareholders, you would find overwhelming support." Musk had previously received approval from Tesla's board in 2018 for a stock option compensation package worth $56 billion (about 77 trillion won), but the plan was stalled due to a lawsuit filed by a minority shareholder seeking to invalidate it. Ahead of the final ruling scheduled for July, Musk aimed to prove shareholder support for his compensation package to gain an advantage in the appeals process, but with successive opposition from major Tesla shareholders, he now finds himself cornered.

Earlier, CalPERS, the largest public pension fund in the U.S. and a major Tesla shareholder, also expressed opposition, and major proxy advisory firms such as ISS and Glass Lewis recommended shareholders vote against the package. On the other hand, another major shareholder, Wall Street's Baron Capital, has expressed support.

Meanwhile, Tesla's stock closed at $177.48 on the New York Stock Exchange last week, down 0.26% from the previous session. The stock has fallen nearly 29% so far this year. Consequently, the estimated value of the stock options in the compensation package has also decreased from $56 billion at the beginning of the year to approximately $46.9 billion, a drop of about 10 trillion won.

This content was produced with the assistance of AI translation services.