CalPERS will be voting against Tesla CEO Elon Musk’s compensation package that was blocked by a Delaware court earlier this year, said Marcie Frost, CEO of the $499.7 billion pension fund, at the June 12 board meeting.
“I want to clearly state for the record, that we did not support the CEO compensation package when it was first approved by shareholders back in 2018, and we will not support it this year,” Frost said.
CalPERS owned nearly 9.2 million Tesla shares as of June 7.
In 2018, the California Public Employees’ Retirement System, Sacramento, raised a number of concerns, including that the award was tied to company growth rather than company profitability as well as that it was a large award for one individual while diluting the shares of other shareholders.
CalPERS joins a number of other asset owners that own Tesla shares to oppose the pay package, including the $332.5 billion California State Teachers' Retirement System, West Sacramento; New York City Comptroller Brad Lander; $46 billion National Employment Savings Trust, London; $43 billion Railpen, London; $20 billion AkademikerPension, Gentofte, Denmark; $1 billion faith-based endowment United Church Funds, New York; and proxy adviser Shareholder Association for Research & Education.
At the same time, Frost said CalPERS joined at least one other shareholder in filing an objection in the Delaware Court of Chancery to the law firms whose shareholder clients successfully got Musk’s $46 billion pay package voided. The law firm is requesting legal fees of more than $5 billion mostly in stock that Frost said “is outrageous” and would also dilute other shareholders’ stock.
CalPERS is joining other shareholders to protest this “would-be windfall,” Frost said. More information about the objection will be released later, she said.
