A deep concern over shareholder “dilution” is driving Norway’s sovereign wealth fund, a $17 billion stakeholder, to reject Elon Musk’s $1 trillion pay package.
If the deal passes, Musk’s ownership stake could jump from 16% to over 25%, a move that would “dilute” the value and voting power of all other investors.
The Norwegian fund, Tesla’s seventh-largest, explicitly named “dilution” as a key reason for its “no” vote, alongside the “total size of the award.”
This focus on protecting the existing shareholder base puts the fund in direct conflict with the Tesla board. Chair Robyn Denholm argues that the real threat to shareholder value is Musk’s potential departure.
However, the Norwegian fund, backed by advisory firms ISS and Glass Lewis, is holding the line, arguing that no CEO is worth diluting the entire company for.