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One of Tesla’s biggest shareholders is openly opposed Elon Musk’s multi-billion dollar compensation package The move comes just days before investors are scheduled to vote on the huge figure ahead of the automaker’s annual shareholder meeting on Thursday.
“We’re in a strong position to be a leader in this industry,” said Christopher Eilman, chief investment officer at the California Teachers Retirement System. CNBC On Monday, a huge state pension fund said it had voted against Musk’s astronomical compensation package, reducing it from a value of $56 billion when investors first voted on it in 2018 to about $10 million.46 billion As of Friday’s closing price.
“We need to pay him a fair wage,” Eilman said. “I’m going to pay him 140 times what the average worker makes. What do you think of that? I think it’s fair enough.”
Aylman slammed the record-breaking compensation package as “absurd” and “unreasonable.” A Delaware judge struck it down in January, saying the final price was “unfair” and the process for determining it was “deeply flawed.” Investors are now voting on whether to reinstate the package.
CalSTRS, which represents more than 1 million California public school teachers, has invested in Tesla since the company was based in California in 2000. The pension fund currently owns 4.6 million shares of the company.
Aylman praised Musk for building Tesla from the ground up, but implored the billionaire leader to hire a professional manager to lead the car company while he focuses on his many other activities.
“He needs to focus on either the car, or X, or going to Mars, and I think his heart is really on going to Mars,” Eilman said.
Musk did not immediately respond to Business Insider’s request for comment.
Despite Musk’s other endeavors, Tesla is still a car company, and its production volumes and stock valuation should reflect that, Ailman said.
“Even if these cars have AI, they’re not worth 60 times the benefits. That’s absurd,” he told CNBC.
Ailman criticized Tesla’s board governance and the billionaire’s tendency for “tantrums,” but ultimately said he was sad to see Musk leave the company.
“I love the fact that he owns the company. He’s the leader, he’s the star. He designed the car,” Eilman told the outlet.
The results of the investor vote will be announced on Thursday. One Wall Street analyst Said BI reported this week that the compensation package is likely to fail, which could lead to a drop in Tesla’s stock price. Proxy advisors are urging investors to vote against the compensation package, and Tesla’s passive investors (about 20% of all investors) will likely follow that advice, Bernstein analyst Toni Sacconaghi told BI.
Other institutional investors who had already vowed to vote against the deal told BI last week that Musk’s decision to redirect shipments of high-demand Nvidia chips from Tesla to X solidified their opposition.
Regardless of Thursday’s outcome, Ailman said CalSTRS has no plans to sell its Tesla shares, even if Musk continues to pursue his dream.
“He wants to go to Mars,” Eilman told CNBC. “Let’s send him flying.”