Elon Musk, CEO of SpaceX and Tesla, attends the Viva Technology conference at the Porte de Versailles exhibition center in Paris on June 16, 2023.
Top proxy advisor Institutional Shareholder Services is recommending that Tesla investors vote against a pay plan for CEO Elon Musk that would grant him nearly $1 trillion more in stock.
The "mega performance equity award" to Musk, designed to retain the CEO long-term, "has an astronomical grant value conditioned upon far-reaching performance targets that, if achieved, would create enormous value for shareholders," ISS wrote on Friday.
Tesla's 2025 annual shareholder meeting and proxy vote is scheduled for Nov. 5. The company is scheduled to report third-quarter results on Wednesday.
ISS said that while some shareholders may support the pay plan, "there are unmitigated concerns surrounding the special award's magnitude and design."
Musk's plan, if approved, would be the largest ever awarded to a public company CEO. It could could net Musk up to an additional 12% stake in Tesla, should the company hit a market cap of $8.5 trillion and achieve other goals.
Tesla disagreed with the ISS recommendations.
In a post on X, which is owned by Musk, the automaker accused ISS of missing "fundamental points of investing and governance," and complained that the advisors had previously "recommended against compensation that shareholders have voted on twice before (and that Elon has already earned), as well as the 2025 CEO Performance Award (where Elon receives nothing unless shareholders win big)."
The company urged shareholders to vote with the board's recommendations on all proposals on the 2025 proxy.
ISS previously advised investors to reject a "ratification" of Musk's 2018 CEO pay package, which was worth an estimated $56 billion at the time.
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