Tesla Investors Should Vote Against 2 Directors, Proxy Advisory Firm ISS Recommends

Tesla Investors Should Vote Against 2 Directors, Proxy Advisory Firm ISS Recommends
  • Proxy advisory firm Institutional Shareholder Services (ISS) recommended that Tesla Inc TSLA investors vote against the re-election of two of its board members, Ira Ehrenpreis and Kathleen Wilson-Thompson, Reuters reports.
  • ISS reasoned that "the board's risk oversight in light of the pledging (as collateral) of a significant amount of the company's stock by certain directors." 
  • ISS stated that pledging company stock by directors or executive officers can pose a risk to outside shareholders' investments. It highlighted the possibility of directors and executives with a pledged position selling company stock to meet a margin call.
  • As of March 31, CEO Elon Musk, director Kimbal Musk, and director Ira Ehrenpreis had pledged a portion of their share ownership, ISS pointed out.
  • The aggregate number of pledged shares jumped from 88.93 million to 89.74 million.
  • ISS also urged Tesla investors to vote for a shareholder proposal regarding the right of employees to form a labor union.
  • Tesla scheduled its annual meeting of stockholders on August 4.
  • In June, Tesla confirmed that it had moved forward with plans for a stock split following Amazon.com Inc's AMZN similar move.
  • Oracle Corp ORCL co-founder and former CEO Larry Ellison did not seek re-election to the Board at the 2022 annual meeting.
  • Price Action: TSLA shares traded higher by 1.34% at $731.30 in the premarket on the last check Tuesday.
  • Photo by Blomst via Pixabay

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