Norway’s sovereign wealth fund, which holds a $17 billion stake in Tesla, has come out against Elon Musk’s $1 trillion pay package, concluding it is too big and too risky for shareholders.
The fund, the world’s largest, announced its “no” vote ahead of Thursday’s annual meeting. It cited three main concerns: the “total size of the award,” the “dilution” of existing shares, and the “lack of mitigation of key person risk.”
This opposition is a major blow to the Tesla board, which has framed the vote as essential to retaining Musk. Chair Robyn Denholm warned investors that the company’s value is at risk if Musk leaves.
The vote comes as Tesla’s sales are struggling. The company has seen sales fall across much of Europe and in China, and its global deliveries dropped 13% in the first half of the year.
The Norwegian fund is not alone. Two major advisory firms, ISS and Glass Lewis, have also recommended that shareholders vote against the unprecedented compensation plan.