Elon Wants His Votes

Tesla Inc. will hold its annual shareholder meeting this afternoon, with the main item on the agenda being shareholder approval of Elon Musk’s new $1 trillion stock compensation package. Will the shareholders vote yes? I mean? Yes? You have come this far. To hitch your wagon to Elon Musk for all these years and then be like “nah, this time he is asking for too much” seems a little silly. If this pay package is approved, maybe Elon Musk will turn Tesla into an $8.5 trillion robot company over the next decade, which will be great for shareholders. But if this pay package is not approved, (1) he probably won’t and (2) he might leave in a huff and turn Tesla into a, you know, $300 billion not-robots company over the next week. You don’t really have a choice. Bloomberg’s Kara Carlson writes:

Right, if you are a shareholder of an Elon Musk company, the deal is (1) you give him whatever he wants whenever he wants it and (2) the stock goes up. Obviously corporate governance experts hate that; it’s terrible governance; really it’s no governance at all. Some investors hate it too, but the remedy for them is not to invest in Elon Musk companies, and they mostly don’t. The people who invest in Elon Musk companies are mostly fine with the deal, and that really is the deal.