(C) Reuters. FILE PHOTO: The logo of car manufacturer Tesla is seen at a dealership in London, Britain, May 14, 2021. REUTERS/Matthew Childs
(Reuters) -Proxy advisory firm Institutional Shareholder Services (ISS) is recommending that Tesla (NASDAQ:TSLA) investors not re-elect directors James Murdoch and Kimbal Musk because the board approved excessive compensation packages to non-executive board members.
Tesla shareholders will cast ballots on Oct. 7 on cutting director terms to two years, eliminating a supermajority vote requirement to approve certain changes, and who will sit on the electric car maker’s board. Tesla is currently valued at $766 billion.
“Votes AGAINST directors James Murdoch and Kimbal Musk are warranted due to concerns regarding excessive compensation to named executive officers and to non-executive directors,” ISS wrote in a report sent to clients last week.
Murdoch, who was chief executive officer of 21st Century Fox and is the son of media magnate Rupert Murdoch, and Kimbal Musk, a restaurant entrepreneur and brother of Tesla CEO Elon Musk, are both running for re-election to the board. The board currently has nine members but will have eight after the annual meeting because director Antonio Gracias is not running again.
ISS said shareholders should reject Murdoch because he serves on the audit and governance committees. The governance committee failed to react appropriately to last year’s majority supported shareholder proposal and the audit committee signed off on pledging a significant amount of company stock to certain directors, raising questions about its risk oversight, ISS wrote. Kimbal Musk does not serve on any board committees.
Kimbal Musk and Murdoch have been part of Tesla’s since 2004 and 2017, respectively.
Elon Musk, who owns 17.2% of the company’s stock, was reelected to the board a year ago with 98.8% of the vote.
The meeting will be held virtually at Tesla’s factory in Austin.
ISS urges Tesla investors not to re-elect James Murdoch, Kimbal Musk
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