Why Norway’s wealth fund said no to Elon Musk’s pay package despite backing Tesla

Norway said no over the package’s size

A top Tesla investor, Norway’s giant government fund, voted “no” to Elon Musk’s new 2025 pay plan. The fund, NBIM, announced its decision on November 4, 2025.

It stated its primary reason was the “total size of the award,” valued at nearly $1 trillion. NBIM also cited a lack of mitigation of key person risk in Tesla’s structure.

The vote came from the world’s largest fund

This group that voted is Norges Bank Investment Management, or NBIM. NBIM manages Norway’s Government Pension Fund Global, the world’s largest sovereign wealth fund.

In 2025, it holds over 2.1 trillion dollars in assets. This vast fund owns a stake in more than 8,800 companies worldwide. Because it is so large, other global investors closely watch its votes on corporate pay and car company governance.

This decision is from a major Tesla backer

The “no” vote is significant because NBIM is a massive supporter of Tesla, not an opponent. This is the “despite backing Tesla” part of the story. As of 2025, the Norwegian fund is the car company’s seventh-largest shareholder.

It owns a 1.14% stake in Tesla, an investment worth $ 11.6 billion. This means its decision was not to hurt the company. It was a financial move to protect its own 11.6 billion dollar stake.

The vote was on a new 1 trillion dollar package

This vote was for Elon Musk’s new 10-year compensation package. All shareholders voted on this plan at a special meeting held on November 6, 2025. This latest deal could be worth up to $ 1 trillion.

It is not a cash salary. Instead, it is a reward of more shares. Mr. Musk only receives these shares if he can grow the electric car and technology company’s market value to an $ 8.5 trillion target.

The plan could make other shares less valuable

One of the fund’s biggest worries was “dilution.” This new pay package would give Mr. Musk up to 12% of the new company shares if he meets his goals.

When a company issues millions of new shares to pay an executive, the value of all the existing shares can decrease. It is like cutting a pizza into more slices; each slice gets smaller. NBIM did not want its 11.6 billion dollar stake in the car company to be diluted.

Other large investors also voted no

Norway’s 2.1 trillion dollar fund was not the only major investor to reject the package. CalPERS, the large public pension fund for California state workers, announced it would vote “no.” CalPERS held over five million Tesla shares.

It shared similar concerns, stating the pay package was larger “by many orders of magnitude” than those at similar companies. It was also worried that the plan would “further concentrate power in a single shareholder.”

The board said the plan was necessary

Despite these “no” votes, Tesla’s board of directors argued strongly in favor of the $ 1 trillion plan. They told investors the package was needed to keep Elon Musk focused on the car company.

The board warned that Tesla risked losing its time and vision if the plan was voted down. They said he might spend more time at his other companies. The board’s main argument was that the plan was a “pay for performance” deal.

The vote passed despite the votes

On November 6, 2025, Tesla’s shareholders approved the new $1 trillion pay package. Even though Norway’s fund, CalPERS, and top advisory firms voted “no,” the plan passed.

Over 75% of the votes cast were in favor of the deal. The vote was a significant victory for Elon Musk and the Tesla board. It showed that most investors still strongly believe in his leadership and vision for the car company’s future.

The deal is tied to massive growth goals

This newly approved plan is not a salary. It is a 10-year award that Elon Musk only gets if he meets huge targets. He must increase Tesla’s market value to $ 8.5 trillion.

He must also meet goals such as selling 20 million cars, deploying one million robotaxis, and producing one million Optimus humanoid robots. If he hits all 12 goals, he will get new shares that could raise his total stake in the car company to 25%.

Investors also voted on his other company

The “key person risk” that concerned Norway’s fund was a significant issue. Elon Musk also runs SpaceX and an artificial intelligence company called xAI. This splits his time and focus.

In fact, shareholders at the same meeting on November 6, 2025, were also asked to vote on a proposal. This proposal would enable Tesla to invest in Mr. Musk’s separate AI company, xAI, illustrating how his tech companies are becoming increasingly interconnected.

Musk says the deal is about control

After the 1 trillion dollar package was approved, Elon Musk appeared on stage with dancing Optimus robots. He told the crowd, “What we are about to embark upon is… a whole new book.”

He also said the vote was not just about the money. He stated he needed a larger stake in the car company, closer to 25%. He said this was important so he could have “strong influence” over Tesla’s future in AI and its “robot army.”

Want to see how Tesla’s stock just rocketed past a significant milestone? Read more in Musk hits half-trillion valuation as Tesla shares surge.

Norway’s vote shows a divide in investors

Norway’s “no” vote shows a split. Large, long-term investors like NBIM and CalPERS are focused on traditional rules, like the size of a pay deal, dilution, and “key person risk.”

They want stable, predictable growth. However, the vote’s approval, with 75% support, indicates that most of Tesla’s shareholders are backing Elon Musk’s ambitious vision. They are willing to approve a record-breaking pay package for the future.

Curious about the deal that almost changed Tesla’s history? Discover the story in The time Elon Musk nearly sold Tesla to Google.

Is this a fair check on executive pay or too harsh? Share your thoughts below.

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This slideshow was made with AI assistance and human editing.