Tesla’s Board of Directors has recently put forth a new pay package for CEO Elon Musk, with the potential for $1 trillion in stock offerings if he meets certain ambitious performance targets. This proposal comes after Musk went without significant compensation since 2017, fulfilling his previous pay package by delivering substantial shareholder value through various performance-based milestones.
Although Musk was unable to claim his previous award due to a court ruling deeming it an “unfathomable sum,” the company is now taking measures to ensure he receives proper compensation. The Board recognizes Musk’s integral role in Tesla’s success and believes it is crucial to retain him as CEO. While acknowledging the contributions of all Tesla employees, the Board emphasizes the importance of having Musk at the helm of the company.
In a statement, Robyn Denholm and Kathleen Wilson-Thompson highlighted Musk’s achievements and encouraged shareholders to approve the payout. The proposed 2025 CEO Performance Award sets forth even more ambitious goals than the previous framework, challenging Musk to achieve operational milestones, expand product offerings, and significantly increase the company’s market capitalization.
The award, consisting of 423,743,904 shares divided into 12 tranches, requires Musk to meet unprecedented performance milestones over the next several years. The Board is confident in Musk’s ability to lead Tesla to new heights and hopes that this pay package will incentivize him to remain with the company.
Overall, the new pay package reflects the Board’s confidence in Musk’s leadership and vision for Tesla’s future. By aligning his compensation with the company’s performance goals, the Board aims to ensure Tesla’s continued success under Musk’s guidance. Shareholders will have the opportunity to vote on the proposed package during the upcoming Shareholder Meeting, where various issues related to the company’s growth and future plans will be discussed.