The oil fund will vote against Musk's Tesla-E24 salary package

The oil fund has made a decision on Elon Musk's huge salary package.

Photograph: Oljevondet/Reuters

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At Tesla's general meeting on June 13, owners will decide on a huge pay package for Tesla CEO Elon Musk once again, and whether the company will also move from Delaware to Texas.

Now the Oil Fund has announced that it will vote against the massive salary package.

Director of Ownership and Compliance, Karen Smith Iheanacho, at the Oil Fund explains the decision to vote against it in a column in E24 on Saturday.

“We believe the salary package is disproportionately high, with significant dilution to shareholders, and has the wrong structure with respect to the purpose of pay,” Iheanacho wrote.

She continued: “We have had a good dialogue with Tesla, including the Chairman of the Board of Directors, on these and other issues,” stressing that the dialogue will continue regardless of the outcome of the general meeting.

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The Fund usually announces its votes five days before the voting date, to contribute to transparency.

In 2018, Tesla owners approved a lucrative salary package for company leader Elon Musk, where he was given the right to buy shares at favorable prices if the company reached certain operational and financial goals.

However, the agreement was halted by a judge in Delaware, where Tesla is registered.

Oljefondet also voted against the wage agreement in 2018.

This is how the oil fund votes at Tesla's general meeting:

Tesla asked shareholders to vote in favor of Musk's salary package, which should total $55 billion (579 billion kroner). The company believes that Musk has achieved the owners' goals and delivered strong results for the company.

The Norwegian Oil Fund will vote against the salary proposal.

Tesla asked shareholders to vote to move the company from Delaware to Texas.

The Norwegian Oil Fund will vote in favor of this proposal.

Several shareholder proposals have been submitted to the general meeting, and Tesla's board of directors recommends rejecting them all.

One of these proposals, Proposition Nine, concerns having company guidelines on the right to organize and collective wage negotiations. The proposal notes that the company should not interfere with or pressure employees who try to form or join a labor union.

“Tesla’s guidance lacks clarity on this point,” the motion submitted to the public meeting says. Tesla's board of directors says the proposal would not serve the interests of Tesla or its owners, because the company is already committed to protecting workers' rights.

The Norwegian Oil Fund will vote in favor of this proposal.

Another suggestion to shareholders is that Tesla should refrain from using minerals mined from the seabed, like BMW, Volvo, Volkswagen, Rivian and Renault. Norway has recently taken several steps to start extracting seabed minerals.

The Norwegian Oil Fund will vote against this proposal.

In addition, the owners must, among other things, decide on shareholder proposals that directors should be re-elected every year, and that votes in the company be determined by a simple majority.

Dinner with musk

The oil trust exercises ownership of companies like Tesla through voting at general meetings and through direct meetings with companies' management and boards of directors.

Tesla was one of the companies that the Fund held a dialogue with last year, according to the Oil Fund’s annual report Report on responsible management. The Fund shares little about the details of this type of dialogue with companies.

Elon Musk is scheduled to be a guest at the fund's investment conference next year. Then he will also be invited to dinner with Oljefondet's president, Nicolai Tangen, who will cook the food himself along with Ferrari CEO Benedetto Vigna. Reindeer will be served.

Nikolai Tangen invited Elon Musk to Oslo: – It will be the most wonderful dinner in Europe

Unrest around trade unions in the Nordic countries

Tesla has recently faced challenges related to trade unions in the Nordic countries.

The IF Metall trade union demanded a collective agreement at Tesla's workshops in Sweden last fall. When Tesla did not agree, there were strikes and acts of sympathy. Tesla later filed a lawsuit against Sweden and Postnord.

The conflict spread to Denmark, Finland and Germany – and the Labor Party and the union tried to discuss unionization with the Norwegian company Tesla.

Tesla itself has stated that the company does not have any kind of global policy against organized work life.