It looks like the Deep State is now failing in their latest attempt to hurt Elon Musk
Tesla’s primary external investor, Vanguard, has endorsed CEO Elon Musk’s substantial $56 billion compensation package, which was crucial in securing its approval during a recent vote. Initially, in 2018, Vanguard had opposed this pay arrangement due to concerns about its size relative to Tesla’s performance. However, a change in stance was observed as Vanguard cited the significant alignment between Musk’s compensation and shareholder returns in the intervening years, alongside the motivational benefits that the package purportedly provides the CEO.
Do you think Elon Musk is worth $56 billion? The majority of Tesla shareholders do.
Curiosity, Cheddar, Random1, Random2, Random3https://t.co/Ex95qwJhWR— News Buyback (@NextgennewsO) June 14, 2024
This affirmation came after a Delaware judge invalidated Musk’s pay earlier in the year, prompting the need for a re-vote. Despite opposition from leading proxy advisors and several major investors, who criticized the package as excessively large, the support from Vanguard was pivotal. The company, holding about 7% of Tesla shares with 232 million shares as of March 31, plays a significant role as a major investor.
“What this was was a separate exercise by the company to say: okay whatever deficiencies are, we’re remedying them,” says former SEC Chair Jay Clayton on Tesla’s shareholders approving Elon Musk’s pay package. pic.twitter.com/GrASRoTOP5
— Squawk Box (@SquawkCNBC) June 14, 2024
The recent shareholder meeting not only focused on Musk’s compensation but also on other key issues such as the re-election of two directors and Tesla’s proposed relocation of incorporation to Texas. Vanguard’s support was deemed essential, given its extensive influence stemming from approximately $9 trillion in total assets.
Although exact voting results from Thursday’s meeting have yet to be disclosed, they are expected soon. Vanguard’s internal communication highlighted that while Musk’s compensation is notably higher than that of other CEOs, Tesla has shown remarkable shareholder return, ranking in the 98th percentile of all Russell 3000 companies from 2018 to 2023. This performance has significantly enhanced market value, according to Vanguard.
Tesla stock soars after Elon Musk says his pay package is likely to be approved and BlackRock and Vanguard reportedly vote in favor #ElonMusk #Tesla #Marketshttps://t.co/SwtaQRHIjX
— Richard Rodnick1 (@RichardRodnick1) June 14, 2024
However, Tesla’s recent challenges were not addressed in Vanguard’s comments. The company has experienced a notable decline in its stock price, dropping by 26.5% this year amid increasing competition from other electric vehicle manufacturers. Despite these hurdles, Tesla’s stock saw an upturn of 2.9% following the shareholder meeting.
Vanguard vote switch helped pass Tesla CEO Elon Musk’s $56 billion pay package https://t.co/vzWpl3kdzG
— Marvin Bontrager, Ph.D. (@mbontrager5) June 14, 2024
Elon had an incredible even for Tesla, check this video out…
Key Points:
i. Vanguard, a major investor in Tesla, endorsed CEO Elon Musk’s $56 billion compensation package, which played a crucial role in its approval.
ii. The endorsement marked a shift from Vanguard’s initial 2018 stance, where they opposed the package due to size and performance concerns, now citing alignment with shareholder returns and motivational benefits for Musk.
iii. The vote was reinitiated after a Delaware judge invalidated Musk’s previous compensation arrangement earlier in the year.
iv. Despite facing opposition from other major investors and proxy advisors, Vanguard’s support was key due to its large stake in Tesla and substantial influence from its $9 trillion in assets.
v. Vanguard’s support comes amidst a period of challenges for Tesla, including a 26.5% drop in stock price this year, although the company’s shareholder return ranks in the 98th percentile from 2018 to 2023.
Kirk Volo – Reprinted with permission of Whatfinger News
