this post was submitted on 13 Jun 2024

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252

Elon Musk wins back his $44.9 billion Tesla pay package in shareholder vote (apnews.com)

submitted 2 years ago by Stopthatgirl7@lemmy.world to c/news@lemmy.world

41 comments fedilink hide all child comments

Tesla shareholders voted Thursday to restore CEO Elon Musk’s record $44.9 billion pay package that was thrown out by a Delaware judge earlier this year, sending a strong vote of confidence in his leadership of the electric vehicle maker.

The favorable vote doesn’t necessarily mean that Musk will get the all-stock compensation anytime soon. The package is likely to remain tied up in the Delaware Chancery Court and Supreme Court for months as Tesla tries to overturn the Delaware judge’s rejection.

Musk has raised doubts about his future with Tesla this year, writing on X, the social media platform he owns, that he wanted a 25% stake in the company in order to stop him from taking artificial intelligence development elsewhere. The higher stake is needed to control the use of AI, he has said.

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[–] DeepThought42@lemmy.world 178 points 2 years ago (2 children)

The fools

[–] pageflight@lemmy.world 63 points 2 years ago* (last edited 2 years ago)

I guess if you're hanging on to your Tesla stock at this point you must have some faith in Musk?

[–] RagingSnarkasm@lemmy.world 40 points 2 years ago (2 children)

I'm not sure about that. It sure feels like if they had a "normal" CEO, the stock price would tank. The crazies who believe in him are the only thing keeping that stock price up. Voting him out (not voting for his pay package) would, I bet, result in a big stock price correction downward.

[–] BlameThePeacock@lemmy.ca 45 points 2 years ago* (last edited 2 years ago) (1 children)

Eventually all Ponzi schemes collapse.

[–] RagingSnarkasm@lemmy.world 12 points 2 years ago

But not because the suckers with skin already in the game vote to crash it.

[–] ImADifferentBird@lemmy.blahaj.zone 10 points 2 years ago

Instead they just voted for massive stock dilution in order to hand a greater share of the company to Elon. That will definitely also affect the price.

[–] LdyMeow@sh.itjust.works 78 points 2 years ago (1 children)

I wonder how tesla owners feel about financing the musky rats purchase of twitter?

This is wild, ‘yes to enrich shareholders i will dilute the shit out if them and give a coked out manbaby a 25% stake’

[–] Zaktor@sopuli.xyz 17 points 2 years ago (2 children)

And giving a giant payday is very likely to inspire him to look for new things to buy. That's a full Twitter in bonus shares and I think Musk looks at his vast paper wealth and tends to always want a new project rather than for the numbers to just steadily go up.

Making a bad bet on Twitter which actually left him meaningfully poorer meant he'd be more likely to devote time to Tesla. Giving him a bunch of money to burn a hole in his pocket makes him more likely to try something else because it's effectively free.

[–] FlyingSquid@lemmy.world 5 points 2 years ago

Why wait for the numbers to steadily go up when you can pump-and-dump and get away with it? Which he does and does.

[–] awesome_lowlander@lemmy.dbzer0.com 4 points 2 years ago

Do you really want him devoting more time to Tesla, though? His best-performing company is SpaceX, which is largely because he leaves it the fuck alone, for the most part.

[–] Fedizen@lemmy.world 71 points 2 years ago (1 children)

tesla is fucked lol.

[–] cordlesslamp@lemmy.today 24 points 2 years ago (1 children)

No, it's the customers who's gonna be fucked

[–] tb_@lemmy.world 26 points 2 years ago

And the employees

[–] Lucidlethargy@sh.itjust.works 60 points 2 years ago

It's a great time to ditch your Tesla stock, folks.

[–] MagicShel@programming.dev 48 points 2 years ago

If I held any Tesla shares, I would be rather cross right now.

[–] FuglyDuck@lemmy.world 42 points 2 years ago (1 children)

Considering that his board are all fighting to latch onto his dick; ether family or friends...

... I can't imagine any serious investor being in on Tesla. There's just too much potential for graft.

[–] RustyShackleford@programming.dev 1 points 2 years ago

There's just too much potential for ~~graft~~ grift.

[–] Tylerdurdon@lemmy.world 24 points 2 years ago (3 children)

Which is it, 56 or 44 billion? If you guys don't know, I'll take the difference.

[–] Marsupial@quokk.au 22 points 2 years ago* (last edited 2 years ago) (1 children)

Granted, you now owe 12 billion.

[–] Tylerdurdon@lemmy.world 15 points 2 years ago (1 children)

Doh!

[–] Snowcano@startrek.website 8 points 2 years ago

The simple charm of this exchange had me rolling

[–] SeaJ@lemm.ee 15 points 2 years ago

It's stock so it was valued at $56 billion when it was initially blocked. Now it is valued at $44 billion.

[–] FaceDeer@fedia.io 4 points 2 years ago (1 children)

If it's in the form of shares so the cash value goes up and down over time with the share price. He's also prevented from immediately selling those shares, so it's in his interest to stick with Tesla and try to ensure that it does well. It's not so ridiculous an arrangement as most people are interpreting it based on just a few headlines.

[–] Tylerdurdon@lemmy.world 14 points 2 years ago (1 children)

Come on man. How much good could be done with that instead of sending it to one person? I think personal wealth should get capped at 1 billion period (not even per year). Even if that cash went directly to employees, it would do more good for the company itself.

It is as ridiculous as arrangement no matter the form of currency. The inequality is grotesque at this point.

[+] FaceDeer@fedia.io -7 points 2 years ago (2 children)

Again, it's shares, not a big heap of cash. They're giving Elon Musk a greater share of ownership in Tesla.

If you want to cap personal wealth like that, what happens when someone founds a company and it grows to be worth more than a billion, do they start losing control of shares until they're below that threshold? Who gets them? What if the share price starts going down again, do they get those shares back?

[–] Tylerdurdon@lemmy.world 20 points 2 years ago

There are many options. Why should 1 person get to direct all of it just because they started something? Did they do it alone? No way, they never do. I believe in a more proportional equity in those situations.

Secondly, Elon didn't found Tesla. It's a very capitalist idea to think a leader should come away with everything. It's part of why the world is in it's current state.

[–] mycodesucks@lemmy.world 14 points 2 years ago (1 children)

do they start losing control of shares until they’re below that threshold?

Sounds good to me. Dole them out to employees.

[–] Takumidesh@lemmy.world 2 points 2 years ago (2 children)

Genuine question, do you think that person is obligated to lose control of the company?

[–] Zaktor@sopuli.xyz 9 points 2 years ago (1 children)

Yes, it's a billion dollar company, not a cherished family farm. Separate from the wealth hoarding it's probably a good policy in general for companies of that size to not be under the control of a single person. Why is this even a question?

[–] Takumidesh@lemmy.world 0 points 2 years ago (2 children)

But in many cases their vote/say would decline to insignificance, literally being pushed out of their own company because they made good decisions.

Should a general in the army get demoted to private because they led a successful operation?

I don't even know how you would define this for private companies. You would have to devise some arbitrary valuation and then remove some other arbitrary chunk of a persons stake in the company.

Besides, this doesn't even solve the money problem anyway, a multi billionaire can just do what they already do and own hundreds of millions in equity in several companies and assets.

Why do you think autocratic control of a company is worse than other forms? You say it's "probably good practice", but as we can see with publicly traded companies which generally are run by committee and owned by millions of people, the quality of a company isn't really dictated by that, in fact, in the case of Tesla, this was voted in by the shareholders, by a wide margin of 72 percent, so the majority of stake holders voted for this. Yes Elon has a big vote at 13 percent, but this means that 59% of stake holders wanted this, Tesla btw, is > 40% owned by retail investors (e.g. regular people) and so this is the result, a majority decision, mostly made by individual stake holders in the company. Many institutional investors actually voted against the pay package.

Saying 'why is this even a question' when someone inquired for more information after you present a radical change to a worldwide economic concept, is just rude and thought terminating. Instead of encouraging discussion, you want to shut people down so you can get feel good points.

If you think there is only one good way to run a business and it happens to be the way you thought up, I encourage you to self reflect.

[–] mycodesucks@lemmy.world 3 points 2 years ago* (last edited 2 years ago) (1 children)

Look, this isn't even the standard operating procedure of society. Corporations are the ONLY situation where we seem to have decided providing the seed of creation equates to perpetual ownership.

ANYTHING else you create comes with a time limit before it takes on a life of its own beyond you.

You wrote a book? Your copyright WILL expire and it WILL be out of your control.

You invented something? That's great. Eventually your patent expires and it becomes publicly usable.

Hell, the closest equivalent to a company? Is having a BABY. You put in a seed to create something, you do a ton of work to raise it to function. Are you going to suggest that a parent should have perpetual control over their children and the things they produce as well? And it has been established by LEGAL PRECEDENT that a corporation IS a person.

ALL of these things are accepted default procedure in our society. In NO other situation do we consider creation to be equivalent to perpetual ownership of all aspects of a thing. YOU are arguing the exception, not us.

[–] Takumidesh@lemmy.world 0 points 2 years ago (1 children)

If I write a book, I get to control if I want to write another book or not. The success of the book doesn't dictate my control over my own writing process (individual agreements not withstanding)

Copyright has for the more than the last century been established to be 50 years longer than the life of the owner, meaning copyright deliberately exists to ensure the creator retains control for their entire life (and then some)

As far as parents go, a patent is not a requirement to make a product and gives no say in your use of your widget that you have patented. If you so choose you can patent a widget and give up trade secrets in exchange for legal protection against appropriation, but that has nothing to do with control in how you operate (it only limits control in how others operate).

I can invent a widget and not patent it and I am still allowed to sell or not sell, manufacture or not, or whatever business decisions I deem important. I can keep it a trade secret and bring it with me to the grave.

[–] mycodesucks@lemmy.world 3 points 2 years ago

All of that is completely true and also irrelevant. The point isn't the specific details, the point is the idea that "perpetual control" is not the default modus operandi of the structure of our system. As to the specific details of where that line is drawn, that's something that's up for debate. All we need as a starting point is to acknowledge that unquestioned, perpetual individual control of an entity that can create and destroy the lives of millions has at least the POTENTIAL to be a dangerous social ill, and the specific details of how we address that can come from there. If you cannot see or acknowledge that at any level, then we're not even looking at reality from the same perspective, and we're not starting from the same priors, so there's no point in discussing it any further - there's no point of agreement we'll be able to reach.

[–] Zaktor@sopuli.xyz 2 points 2 years ago

But in many cases their vote/say would decline to insignificance

Their vote would decrease to roughly $1B / total company value. That's not irrelevance unless you're talking about businesses so large they've become major shapers or our culture and economy. And if the founder's decisions are just amazingly awesome the new board can hire them as CEO. And then fire them when they're an idiot. Twitter shows us the cost of autocratic control by a bad owner.

Saying ‘why is this even a question’ when someone inquired for more information after you present a radical change to a worldwide economic concept, is just rude and thought terminating. Instead of encouraging discussion, you want to shut people down so you can get feel good points.

If you think there is only one good way to run a business and it happens to be the way you thought up, I encourage you to self reflect.

Lol. Yeah, it wasn't intended to be (apparently) an attack on you and your personal belief system, but getting worked up about people being mean to literal tycoons makes me totally ok with having caused offense.

[–] mycodesucks@lemmy.world 5 points 2 years ago* (last edited 2 years ago)

There is a significant difference between "lose control of the company" and "not being the exclusive beneficiary of the success of the company", and it's a strawman argument to suggest otherwise.

Even with a 1 billion dollar cap, the vast majority of companies are not worth nearly a billion dollars, and of those that are, you would have to double that before that owner would not have a controlling interest, and while I acknowledge that the owner losing control of the company is not necessarily an intentional result of this kind of rule, by the time a company reaches a value where that would even be a threat, they have such an outsized impact on society through their operation that it is actually irresponsible for any single person or small group of people to have such control. Organizations can grow to have outsized impact on millions of lives, entire communities, or even the direction of history. What is reprehensible isn't capping their control of such an organization - it's allowing that control to impact the world with absolutely no check by those its operation affects. I don't know your country of origin, but if you are American you at least pay lip service to the idea that power derives from the consent of those over whom it is wielded. I would suggest to you the radical interpretation is that that should only apply to government when extremely large companies have much, much more power to impact peoples' daily lives.

[–] thenextguy@lemmy.world 9 points 2 years ago (1 children)

"Well, I didn't vote for you."

[–] hydrashok@sh.itjust.works 6 points 2 years ago

You don’t vote for Musks!

[–] LordGimp@lemm.ee 5 points 2 years ago (2 children)

Someone ELI5 why does a Delaware court have any say over tesla stock options?

[–] Oneser@lemm.ee 5 points 2 years ago

This Reuters article provides a decent summary: https://www.reuters.com/legal/case-against-elon-musks-56-billion-pay-package-2024-01-30/

[–] Takumidesh@lemmy.world 3 points 2 years ago (1 children)

Tesla is incorporated in Delaware.

[–] ObsidianNebula@sh.itjust.works 8 points 2 years ago

To add onto this for anyone interested, the reason it and many businesses are incorporated in Delaware specifically is because it has a very pro-business legal and judicial system. Many businesses benefit from choosing that state over others and can find loopholes that allow them to save money (though there have been efforts to eliminate those loopholes in much of the country).

Phil Edwards recently released a video on this, which is how I found out about it: https://youtu.be/b4q99EuZF_Q

And this is the article that inspired the video: https://www.atlasobscura.com/places/corporation-trust-center