Norway’s oil fund to vote towards Musk’s $56bn Tesla pay award

Unlock the Editor’s Digest for freeRoula Khalaf, Editor of the FT, selects her favorite tales on this weekly e-newsletter.The world’s largest sovereign wealth fund has mentioned it will vote towards Elon Musk’s $56bn pay award at Tesla, as the largest remuneration bundle in US company historical past comes below intense shareholder scrutiny.Norway’s $1.7tn oil fund, the eighth largest shareholder in Tesla, mentioned on Saturday that it was “involved” about the scale of the pay bundle, its construction and the way it fails to mitigate “key particular person danger”.Tesla shareholders will vote on the award on Thursday, after a choose in Delaware struck it down in January, calling it “an unfathomable sum”.The Norwegian fund owns about 1 per cent of Tesla, value about $8bn on the finish of 2023. It voted towards the pay bundle when it was first proposed in 2018, and mentioned its stance had not modified.Each ISS and Glass Lewis, the 2 largest proxy advisers, have additionally really helpful shareholders reject Musk’s pay bundle.The oil fund has taken an more and more lively line towards pay packages, significantly within the US, the place it has voted towards greater than half of all awards of greater than $20mn. Final yr, it voted towards pay offers at a few of its greatest holdings together with Apple, Google proprietor Alphabet and LVMH.“We’re seeing company greed reaching a degree that we haven’t seen earlier than and it’s actually changing into very expensive for shareholders in terms of dilution,” Nicolai Tangen, the fund’s chief government, mentioned in 2022.RecommendedThe Norwegian fund mentioned it might “search constructive dialogue with Tesla on [pay] and different subjects”, and that it appreciated “the numerous worth generated below Mr Musk’s management”.It mentioned it might vote in favour of Tesla shifting its incorporation from Delaware to Texas, a transfer that was proposed on account of Musk’s fury on the choose’s pay resolution. The pay bundle — which was topic to Musk rising Tesla’s share worth considerably — was awarded in 2018 when the electrical carmaker was struggling to provide vehicles at scale.The Norwegian fund additionally mentioned it might vote in favour of a shareholder proposal backing commerce union rights, which Tesla opposes. Tesla is embroiled in a bitter and long-lasting combat with commerce unions in Sweden over its refusal to recognise collective bargaining within the Scandinavian nation.Tesla has beforehand mentioned that the pay award has pushed “greater than $735bn in worth creation” and expressed confidence that its shareholders would “honour the deal they authorised in 2018”.

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