A coalition of progressive Tesla shareholders has expressed concern over CEO Elon Musk's focus on his role at the electric vehicle manufacturer. They have urged the board of directors to ensure Musk dedicates more time and attention to the company's challenges, such as the increasing competition in the electric vehicle market and allegations of an unhealthy work environment at Tesla.
Apart from his responsibilities at Tesla, Musk is also at the helm of multiple companies, including Twitter, SpaceX, the Boring Company, and Neuralink. The concerned shareholders initially invested in Tesla, believing it to be a pioneer in creating products and services vital for the transition to a sustainable and eco-friendly economy. However, they have become increasingly worried about governance and leadership issues within the company.
Signatories of the letter include Amalgamated Bank, a union-owned bank, Sisters of St. Joseph of Carondelet, United Church Funds, Investor Advocates for Social Justice, and the New York City Controller's Office. Collectively, these investors own $1.5 billion in Tesla shares, which accounts for less than 1% of the total shares. In contrast, Musk's ownership and options amount to approximately $118 billion in Tesla shares or 20% of the stock.
The letter claims that Musk's divided attention is causing issues within the company, such as high staff turnover rates due to the work environment. However, it does not provide specific suggestions on how to ensure his focus on the company's challenges.
Ivan Frishberg, Chief Sustainability Officer at Amalgamated Bank, mentioned that other investors also share concerns about Musk's divided attention, particularly with his recent acquisition of Twitter and his leadership roles in SpaceX and other companies. Frishberg emphasized that the group is not advocating for Musk's replacement as CEO. Instead, they want a more independent and responsive board that ensures the CEO is committed to addressing Tesla's challenges.
Currently, Musk receives no cash salary from Tesla, and after acquiring the final block of stock options from his 2018 compensation package earlier this year, he has no additional stock options to qualify for. While some analysts believe Tesla should announce a new compensation package to reassure Wall Street of Musk's commitment to the company, Frishberg disagrees, stating that offering more money is not the solution.
