A Tesla electric car gets charged.
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Investors already knew the results of shareholder voting at Tesla
‘s annual meeting. But until now investors didn’t know exactly how the voting went down.
Tesla (ticker: TSLA) filed the full annual meeting voting results on Wednesday afternoon. It turns out Kimbal Musk cruised and a proposal from a group of nuns did a little better.
Tesla’s annual shareholder meeting was held on Oct. 7 at the electric vehicle company’s new facility in Austin, Texas. The big news coming out of that meeting was CEO Elon Musk’s announcement that the company would move its headquarters to Texas from California.
That move didn’t need shareholder approval. Other items discussed at the meeting, of course, did. Here’s how the voting went down, along with some recent history.
Proposal 1: Election of Kimbal Musk and James Murdoch
Elon Musk’s brother, Kimbal Musk, and media mogul James Murdoch were up for re-election. Re-election of directors typically isn’t that exciting, but proxy advisor Institutional Shareholder Services, of ISS, recommended shareholders vote against their re-election. ISS had a problem with Tesla’s board compensation practices.
The ISS recommendation didn’t matter. Kimbal Musk received more than 473 million votes for re-election and about 117 million votes against. Murdoch received about 412 million votes for and 175 million against.
Proposals 2 and 5: Board of Director Terms
A proposal to reduce director terms to two years wasn’t ratified because too few shareholders voted on it. The proposal did receive about 590 million votes, but the total votes cast amounted to less than the two-thirds required to make the vote official.
Another proposal, proposal 5, which was submitted by shareholders to reduce director terms to one year, was approved by a vote of roughly 315 million for and 260 million against.
This proposal, however, is non-binding. The board doesn’t have to adopt it. Non-binding proposals are one way of signaling what shareholders want without directly interfering with board oversight of the company.
Proposal 9: Human Rights and the Sisters of the Good Shepherd
Proposal 9 was a non-binding proposal submitted by the Sisters of the Good Shepherd wanting Tesla to increase reporting on human rights issues impacted by company operations. It’s a noble idea, but Tesla’s board recommended against voting for the proposal saying, in part, that tracking all the parts and materials Tesla uses all the way up and down its supply chain—from the mine to the assembly line—was too difficult.
The proposal was voted down, but the Sisters of the Good Shepherd received 149 million votes for and 427 million against.
A similar proposal in 2020 received 27 million votes for and 83 million against. That is the equivalent to about 135 million votes for and 415 million against. Don’t forget Tesla split its stock 5-for-1 in 2020.
The nuns did a little better. They got about 26% of the votes cast in 2021 compared with 25% in 2020.
Since Tesla’s annual meeting, the stock has gained about 2%. The S&P 500, Dow Jones Industrial Average and Nasdaq Composite Index have declined about 1% over the same span.
Write to Al Root at [email protected]
