Norway challenges Tesla: state fund to vote against Musk's record salary

El Norges Bank Investment Management (NBIM), which manages the Norway's sovereign wealth fund valued at 2,1 trillions of dollarsHe announced that will vote against the proposed compensation package for Elon Musk, the CEO of Tesla, at the annual shareholders' meeting to be held this Thursday, November 6.

The fund, which owns the 1,1% of Tesla's sharesHe justified his decision by claiming “Concerns about the size of the package, the risk of dilution, and the over-reliance on a single personIn a statement, NBIM acknowledged “the significant value created under Mr. Musk’s visionary role,” but insisted that Compensation must be proportional, transparent, and sustainable in the long term..

The decision represents a symbolic setback for Tesla and Musk, at a time when the company is facing a Increased regulatory pressure, growing competition in electric vehicles, and criticism of its corporate governanceIt is also the second time The Norwegian fund rejects a salary proposal from Musk, after opposing the package in 2024. 56.000 million, the highest approval rating in the history of a listed company.

El vote of the Norwegian fund This adds to the negative recommendations of Glass Lewis e Institutional Shareholder Services (ISS)Two of the leading advisory firms for institutional investors have urged Tesla shareholders to reject the plan because they considered it "excessive and poorly justified".

A package designed to tie Musk to Tesla

The controversial compensation plan, valued at One billion dollars, is structured in 12 sections linked to ambitious growth targets. Among them, achieving a market capitalization of $8,5 trillion in the next decadeThis would make Tesla the most valuable company in the world, far surpassing Apple or Microsoft.

If all the milestones are met, Musk would receive 423 million new sharesincreasing its stake in Tesla to about 25%According to the company president, Robyn DenholmThis shareholding link is essential for Keep Musk engaged with the company's vision.

In a letter sent to shareholders, Denholm warned that “Without Elon, Tesla could lose significant value, as the company might not be valued for what it's trying to become.The executive insisted that The package does not represent a traditional salary., but one reward for extreme performancedependent on results that “could only be achieved under extraordinary leadership.”

The message reflects the sense of urgency within the company, where some investors fear that Musk can get distracted with his other projects —such as SpaceX, X (Twitter), Neuralink or xAI— if the package isn't approved. Denholm even suggested that Musk could abandon Tesla if the board does not guarantee the proposed level of compensation.

The tension between Musk and the Norwegian fund

The confrontation between Musk and the Norwegian sovereign wealth fund This is nothing new. In 2024, when NBIM voted against the previous $56.000 billion compensation package, the tycoon responded coolly. According to reports, Musk He declined a dinner invitation from Oslo. Following the negative vote, he sent a message in which he essentially reproached her for her lack of support: "When I ask you for a favor, which I do very rarely, and you refuse it, then you shouldn't ask me for any until you've done something more than nothing to make up for it."

Relations between the two parties have cooled since then. For the Norwegian fund, its vote is not due to a personal conflict, but rather to principles of governance and sustainability which applies to all the companies in which it invests. NBIM, which holds stakes in more than 9.000 companies, has historically been critical of the concentration of power in CEOs and with the excessive compensation structures which, according to their analysts, can create distorted incentives.

"Executive compensation should be aligned with long-term value for shareholders and society.“,” the fund stated in its public investment policy.Disproportionate packages can undermine confidence in capital markets and create over-reliance on a single corporate entity".

A decisive vote for the future of Tesla

The Tesla shareholders They even have midnight on November 5th to cast their vote on the wage package, which will be the central point of the annual meeting convened in the Texas GigafactoryThe company hopes to obtain the support of a simple majority to approve the plan, although opposition from major institutional investors could to question the result.

Beyond the symbolism of the vote, the result will be interpreted as a referendum on confidence in Elon MuskIn case of rejection, Tesla would face a leadership crisis At a delicate moment, with electric vehicle sales stagnating in some markets and Chinese competition, led by BYDgaining ground.

If the package is approved, Musk would solidify his position as the highest paid executive in historybut it would also reignite the debate about Wage inequality and the power of top CEOs in a global context marked by inflation and pressure on workers.

Whatever the outcome, the Norwegian sovereign wealth fund's vote confirms that Musk's charismatic leadership is no longer enough to convince large institutional investors.As one Reuters analyst concluded: “Elon Musk remains a visionary, but even visionaries must be accountable to their shareholders.”