Glass Lewis Urges Tesla Shareholders To Vote Against Elon Musk’s $1T Pay

• Glass Lewis said that the approval of the compensation would lead to potential share dilution.
• Last week, ISS also recommended voting against the $1 trillion pay package of CEO Elon Musk.
• Tesla said in a post on X that ISS and Glass Lewis have recommended against Tesla’s proposals time and time again since the 2018 CEO Performance Award was introduced.

Proxy adviser Glass Lewis has urged Tesla (TSLA) shareholders to vote against CEO Elon Musk's $1 trillion compensation package, joining Institutional Shareholder Services (ISS) to reject one of the largest salary packages of a company’s head.

Glass Lewis stated that the approval of the compensation would lead to potential share dilution and other terms of the proposed pay plan "warrant significant concern,” according to TheFly.

The recommendations by Glass Lewis and ISS come as part of wider voter guidance issued ahead of Tesla's annual shareholders meeting on November 6.

Retail sentiment on Tesla remained unchanged in the ‘bearish’ territory compared to a day ago, with message volumes at ‘low’ levels, according to data from Stocktwits.

What Is Tesla’s Response?

Tesla said in a X post that ISS and Glass Lewis have recommended against the company’s proposals time and time again since the 2018 CEO Performance Award was introduced.

“…Glass Lewis has followed ISS and issued another misguided recommendation that again disregards the fundamental purpose of public companies and who they serve – the shareholders. These firms do not own Tesla – you do,” the company added.

Tesla said that the shortcomings of these proxy advisors are echoed by state and federal officials, who are scrutinizing ISS’s and Glass Lewis’s practices, including by implementing laws that require that their recommendations be based on the financial interests of shareholders.

“ISS’s and Glass Lewis’s recommendations attempt to override the mandate our shareholders delivered to Elon and ignore the staggering financial results delivered under Elon’s leadership, elevating their rigid policies over shareholder value.,” Tesla said further in the post.

What Did ISS Say About The Pay Package?

According to a Reuters report, ISS said that this was part of the board's goal to retain Musk because of his "track record and vision," the 2025 pay package "locks in extraordinarily high pay opportunities over the next ten years." 

ISS noted that his also "reduces the board's ability to meaningfully adjust future pay levels."

The report added that ISS highlighted concerns over the proposed grant’s "astronomical" size, its structure allowing substantial payouts even with partial goal attainment, and the risk of diluting existing shareholders' equity.

Shares of Tesla rose 1% in early trading on Monday and have more than doubled in the last 12 months.

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