Norway’s $2 trillion sovereign wealth fund, Tesla’s sixth-largest institutional shareholder, voted against Elon Musk’s proposed $1 trillion compensation package—the largest in corporate history—citing concerns over its size, shareholder dilution, and the risks of concentrating power in a single executive. Despite this high-profile opposition and objections from other major investors, Tesla shareholders approved the package on November 6, 2025, with over 75% support at the company’s annual meeting in Austin, Texas.
Inside the Unprecedented Compensation Proposal
Tesla’s board secured shareholder approval for a compensation plan that could grant Musk up to 423.7 million additional shares over the next decade, divided into 12 tranches tied to ambitious performance milestones. If all targets are met, the package could be worth about $1 trillion before costs, or roughly $878 billion net. To unlock the full award, Musk must drive Tesla’s market capitalization from $1.5 trillion to $8.5 trillion by 2035—a 466% increase that would make Tesla the world’s most valuable company by a wide margin. The plan also requires Tesla to deliver 20 million vehicles, deploy 1 million robotaxis, deliver 1 million humanoid robots, and secure 10 million active Full Self-Driving subscriptions by the same deadline.
Investor Backlash and Board Warnings
Norway’s Government Pension Fund Global, which holds a 1.14% stake in Tesla worth $11.6 billion, was not alone in its opposition. The California Public Employees’ Retirement System (CalPERS), the largest U.S. public pension fund, also voted against the package, arguing the proposed pay dwarfs CEO compensation at comparable companies. Leading proxy advisory firms Institutional Shareholder Services and Glass Lewis recommended shareholders reject the plan, citing vague or undemanding performance targets and excessive board discretion.
Despite this, Tesla’s board, led by Chair Robyn Denholm, warned that rejecting the package could jeopardize Musk’s continued leadership. Denholm argued that Musk’s vision and drive are essential to Tesla’s value, framing the vote as a referendum on whether shareholders want to retain and motivate him as CEO. The strategy proved successful, with the package receiving 75% approval overall, or 66.9% when excluding votes from board members and executives.
Control, Succession, and the “Key Man” Debate
Musk, who currently owns about 13% of Tesla after multiple stock sales, stated that the compensation is less about personal wealth and more about maintaining control. He claims he needs a 25% stake to ensure strong influence over Tesla’s future in artificial intelligence and robotics, expressing concerns about being ousted by activist investors. The Norwegian fund, however, highlighted the dangers of “key person risk”—the vulnerability that comes from tying a company’s fate too closely to one individual, especially without clear succession planning.
Not all major investors opposed the plan. Baron Capital Management, which holds 0.4% of Tesla shares, voiced strong support, crediting Musk’s ambition and standards for Tesla’s global impact and arguing that his interests are aligned with shareholders. Meanwhile, Tesla’s largest institutional shareholders—Vanguard, BlackRock, and State Street—did not publicly disclose their voting intentions before the meeting.
Public Scrutiny, Legal Battles, and Market Headwinds
The compensation debate spilled into the public arena, drawing commentary from figures as prominent as Pope Leo XIV, who criticized the package as emblematic of extreme wealth inequality. Musk responded by quoting scripture, fueling a broader debate about executive pay and corporate values.
The controversy comes as Musk is fighting to reinstate a previous $56 billion pay package that was voided by a Delaware court over conflicts of interest and board independence. The court found that Tesla’s board was too closely tied to Musk and that shareholders were not adequately informed. Despite a new shareholder vote in June 2024 that saw 84% approval from non-Musk shareholders, the court reaffirmed its decision in December 2024, stating that flawed processes cannot be remedied by subsequent votes.
Meanwhile, Tesla faces significant business challenges. While the company saw a sales boost in Q3 2025 as buyers rushed to purchase vehicles before the $7,500 federal EV tax credit expired on October 1, global sales have declined sharply in key markets. Musk’s political involvement has also affected Tesla’s brand, particularly in states like California.
Shareholders Deliver Historic Approval
The November 6 vote delivered a decisive outcome despite institutional investor divisions. With retail shareholders holding significant sway—84% of non-Musk shares supported his previous compensation proposal in the June 2024 re-vote—the package passed with overwhelming support. If Musk achieves all targets, he could become the world’s first trillionaire, concentrating unprecedented wealth and influence in a single individual.
The result, announced at Tesla’s annual meeting in Austin, sets a precedent for executive compensation, corporate governance, and the balance of power between visionary leaders and the shareholders who back them.