Tesla shareholders approved CEO Elon Musk’s $56 billion pay package, the company reported on Thursday. The pay package is an incentive for Musk to continue leading the electric vehicle-maker. Despite opposition from some large institutional investors and proxy firms the proposal passed, underscoring the support that Musk has from Tesla’s retail investor base.
Musk’s pay package has raised some concerns among judges and legal experts with some expecting Musk to face a fresh lawsuit on the package, which would be the largest in U.S. corporate history. Shareholders previously voted for this package in 2018.
Other shareholder approvals
On Thursday, shareholders also approved a proposal to move the company’s legal home from Delaware to Texas. They also approved other proposals including the re-election of two board members, Elon Musk’s brother Kimbal Musk, and James Murdoch.
In addition, shareholders raised the level of investor control by passing proposals in favor of shortening board terms to one year. Moreover, they proposed lowering voting requirements for proposals to a simple majority, despite board opposition to both.
The approval of Musk’s pay package is both an endorsement of Musk’s tenure and an acknowledgment that investors do not want to risk the company’s future, believing that it is dependent on Elon Musk.
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Tesla’s performance
During the meeting, Elon Musk revealed that the company recently shipped a record-high 1,300 Cybertrucks in a week. Moreover, he revealed that plans for volume production of its semi trucks were in place. Musk elaborated on his plans for autonomous cars. However, he did not provide a time frame for their launch.
Since 2021’s peak, Tesla’s share price has dropped about 55 percent as EV sales saw a decline and Musk’s attention has been on Tesla and other companies he runs. Following the announcement of Musk’s pay package, Tesla’s shares rose by 2.92 percent to $182.47.
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