Norway's sovereign fund said it will vote against Tesla (NASDAQ:TSLA) boss Elon Musk's bonus at this week's shareholder meeting, joining the list of organisations objecting to the $56 billion pay package.
The vote at the annual general meeting (AGM) on June 13 will include a proposal from the board to ratify whether Musk should receive the giant pay package.
Originally awarded in 2018, but made void in January this year after a US judge found that Tesla’s directors had failed properly to disclose the full details of the package, the new vote is to re-approve the package given the release of more details.
The pay vote is advisory, meaning management does not have to follow the result.
Top proxy advisors ISS and Glass Lewis have both recommended their institutional clients vote against ratifying the package.
Norges Bank, the $1.7 trillion state-owned Norwegian fund, has joined that group. It owns a 0.98% stake in Tesla, worth 78.4 billion Norwegian krone ($7.3 billion).
Norges Bank Investment Management said it has already submitted a vote against Tesla's proposal to ratify performance-based stock options to Musk, consistent with its vote on the same award in 2018.
"While we appreciate the significant value generated under Mr Musk's leadership since the grant date in 2018, we remain concerned about the total size of the award, the structure given performance triggers, dilution, and lack of mitigation of key person risk.
"We will continue to seek constructive dialogue with Tesla on this and other topics."
Norges Bank said it also intends to vote against Tesla management's recommendation on a shareholder proposal to declassify the board to ensure an accountable and frequently elected board, with votes on all board members appointments each year.
It is also supporting another shareholder proposal adopting a simple majority vote to discourage anti-takeover measures. Additionally, NBIM backs improving sustainability disclosures to align with global reporting standards, enhancing transparency and investor analysis.
However, it aligns with management in opposing proposals related to electromagnetic radiation reporting, sustainability-linked executive compensation, and a moratorium on sourcing minerals from deep-sea mining.