Skip to Main Content
HBS Home
  • About
  • Academic Programs
  • Alumni
  • Faculty & Research
  • Baker Library
  • Giving
  • Harvard Business Review
  • Initiatives
  • News
  • Recruit
  • Map / Directions
Faculty & Research
  • Faculty
  • Research
  • Featured Topics
  • Academic Units
  • …→
  • Harvard Business School→
  • Faculty & Research→
Publications
Publications
  • April 2018 (Revised June 2020)
  • Case
  • HBS Case Collection

Tesla's CEO Compensation Plan

By: Krishna G. Palepu and Sarah Mehta
  • Format:Print
  • | Language:English
  • | Pages:31
ShareBar

Abstract

Tesla’s board of directors proposed an unusual compensation plan for the company’s CEO Elon Musk. The plan payouts were entirely contingent on achieving very ambitious market value, sales, and EBIT targets over the next ten years. If all the targets were achieved, Tesla would be one of the most valuable companies in the world, and Musk would receive the highest compensation of any CEO in U.S. corporate history. If the targets were not achieved, Musk would receive nothing. Proxy advisors (ISS and Glass Lewis) expressed serious reservations about the plan and urged shareholders to vote against it. Should shareholders approve or reject the plan?

Keywords

CEO Compensation; Compensation Committee; Corporate Governance; Executive Compensation; Governing and Advisory Boards; Business and Shareholder Relations; Auto Industry; United States

Citation

Palepu, Krishna G., and Sarah Mehta. "Tesla's CEO Compensation Plan." Harvard Business School Case 118-085, April 2018. (Revised June 2020.)
  • Educators
  • Purchase

About The Author

Krishna G. Palepu

Accounting and Management
→More Publications

Related Work

    • June 2020
    • Faculty Research

    Tesla's CEO Compensation Plan

    By: Krishna G. Palepu
    • April 2018 (Revised June 2020)
    • Faculty Research

    Tesla's CEO Compensation Plan

    By: Krishna G. Palepu and Sarah Mehta
Related Work
  • Tesla's CEO Compensation Plan By: Krishna G. Palepu
  • Tesla's CEO Compensation Plan By: Krishna G. Palepu and Sarah Mehta
ǁ
Campus Map
Harvard Business School
Soldiers Field
Boston, MA 02163
→Map & Directions
→More Contact Information
  • Make a Gift
  • Site Map
  • Jobs
  • Harvard University
  • Trademarks
  • Policies
  • Accessibility
  • Digital Accessibility
Copyright © President & Fellows of Harvard College