((Automated translation by Reuters, please see disclaimer https://bit.ly/rtrsauto))
(Added comment from Musk to paragraph 9) by Louise Rasmussen and Gwladys Fouche
Norway’s $1.7 trillion sovereign wealth fund said Saturday it would vote against ratifying Tesla TSLA.O Chief Executive Elon Musk’s $56 billion pay plan, which will be put to a shareholder vote next week , after a Delaware judge struck down the plan earlier this year.
The fund is Tesla’s eighth-largest shareholder, according to LSEG data.
Musk’s compensation, the largest for a business leader in America, was approved in 2018 but overturned by a judge earlier this year, who said the amount was unfair to shareholders, calling it a “sum unfathomable”.
The fund said it appreciated “the significant value generated under Mr. Musk’s leadership since the grant date in 2018.”
Nonetheless, “we remain concerned about the total size of the award, the structure considering performance triggers, dilution and the lack of key person risk mitigation,” Norges Bank Investment Management (NBIM) said, the fund operator.
In 2018, the fund voted against the package.
“We will continue to seek constructive dialogue with Tesla on this and other topics,” NBIM added.
The fund, which holds a 0.98% stake worth $7.7 billion according to fund data, has criticized excessive CEO compensation.
Responding to a post on social media platform in his favour”
Last year, it voted against more than half of U.S. CEO pay packages above $20 million, warning they fell short of creating long-term value for shareholders.
UNIONS
The fund also said it would vote in favor of a shareholder proposal calling on Tesla to adopt a policy of freedom of association and collective dealings, a victory for unions seeking to assert their influence over the automaker American automobile.
The vote comes as Tesla continues to face industrial action in Sweden, with its mechanics on strike since October 27, part of one of the country’s longest labor disputes.
The Norwegian fund, which owns 1.5% of all publicly traded stocks worldwide, also backed a 2022 shareholder proposal calling on Tesla to adopt a policy respecting workers’ rights, such as freedom of association and collective transactions.
The electric vehicle maker is facing an outcry in the Nordic region from unions and some pension funds over its refusal to accept its Swedish mechanics’ demand for collective bargaining rights covering wages and other conditions.
TEXAS
The pension fund voted to move the state from Delaware to Texas, a vote Musk requested after the Delaware judge struck down his salary.
The fund also said it would vote in favor of a proposal to elect Musk’s younger brother, Kimbal, 51, to Tesla’s board of directors. The fund voted to elect him in 2018, according to fund data.
Tesla shareholders will vote on Musk’s compensation, as well as the re-election of directors, including Musk’s brother, at their annual meeting scheduled for June 13.
