Norway’s sovereign wealth fund has announced it will vote against Tesla’s proposed $1 trillion compensation plan for Elon Musk, citing concerns about corporate governance and risk management. The move could influence other major shareholders as the automaker prepares for a closely watched annual meeting.
The fund, which manages assets worth $1.5 trillion and holds roughly $17 billion in Tesla shares, said it appreciated Musk’s contributions to the company but could not endorse a package of this scale. Its statement emphasised that “the total size of the award, dilution effects, and lack of risk mitigation are inconsistent with long-term shareholder interests.”
The pay proposal would allow Musk to earn massive share options if Tesla’s valuation grows from $1 trillion to $8.5 trillion in the next decade. That would make him one of the wealthiest individuals in history and increase his control over Tesla’s future.
Tesla’s board maintains the incentive is necessary to retain Musk, whom they describe as “integral to the company’s continued innovation.” Chair Robyn Denholm warned that without such incentives, Tesla risked losing a leader “who has delivered extraordinary results for shareholders.”
Nevertheless, independent governance advisers have questioned the structure of the deal. Both Glass Lewis and ISS have urged shareholders to vote against it, citing inadequate safeguards and excessive concentration of power. They also point to Tesla’s reliance on Musk as a strategic vulnerability.
The Norwegian fund’s stance is consistent with its long-standing focus on responsible ownership and transparent executive pay. It has historically opposed oversized CEO packages, arguing that linking rewards too heavily to market capitalisation can distort corporate priorities.
The outcome of Thursday’s vote is uncertain, but the fund’s decision carries symbolic weight. Its opposition underscores the tension between celebrating visionary leadership and enforcing corporate discipline — a balancing act that could shape Tesla’s governance for years to come.