Copyright International Business Times
Ark Invest founder Cathie Wood is a longtime Tesla (Nasdaq:TSLA) bull. Late Sunday, she said in an X post that Musk's $1 trillion (£747.4 million) compensation plan will comfortably secure shareholder votes. She expects Musk's pay package to win 'decisively,' despite growing opposition from proxy advisory firms like Institutional Shareholder Services (ISS) and Glass Lewis, which dominate institutional investing. In the latest episode of the 'The Brainstorm' podcast, she also highlighted that Tesla chief Elon Musk accomplished the operational milestones tied to his 2018 pay package of $56 billion (£41.8 billion) much earlier than expected. 'He accomplished those expectations two years earlier than we expected him to,' Wood said, adding that the company's earnings before interest, taxes, depreciation, and amortisation grew over 40% on average, which only a few companies have ever achieved. 'It is a win-win for all of us if Elon succeeds this time around the way he did the last time. I hope the appeals court does the right thing,' Wood added. Ars Technica stated that ISS does not see the monumental compensation plan include mechanisms to make sure Musk remains focused on Tesla, given his multiple business ventures. Multiple proxy firms have urged investors to vote against the pay package. However, Wood continued to fiercely defend Musk's pay package proposal, which is set for a shareholder vote on 6th November. 'What do Glass Lewis and ISS know about the convergence among the robots, energy storage, and artificial intelligence (AI) involved in robotaxis and humanoid robots? Have they researched the odds of Elon leading Tesla to 10 years of 41% EBITDA growth on average?,' she wrote in a Monday X post. The pay package would award Musk up to $1 trillion in company stock if he achieved about a dozen operational milestones, including driving Tesla's market valuation to $8.5 trillion (£6.3 trillion) as well as selling 12 million cars and 1 million Optimus robots over the next decade. Tesla's board also cautioned that there is a possibility that Musk could walk away from Tesla if shareholders reject the compensation proposal. 'Isn't it sad, if not damning, that institutional shareholders rely on proxy firms to tell them how they should vote?' Wood questioned in a follow-up X post. 'Index funds do no fundamental research, yet dominate institutional voting. Index-based investing is a form of socialism. Our investment system is broken.' If the new package is approved, Musk's stake in Tesla could rise to around 29% from 13%, offering him more control over the EV maker. Musk has stated earlier that it is not about money, but rather about having adequate influence over Tesla to ensure safety if the company builds millions of robots. 'If I can just get kicked out in the future by activist shareholder advisory firms who don't even own Tesla shares themselves, I'm not comfortable with that future,' Musk wrote in a September post on X. Disclaimer: Our digital media content is for informational purposes only and not investment advice. Please conduct your own analysis or seek professional advice before investing. Remember, investments are subject to market risks and past performance doesn't indicate future returns.
