August 15, 2022

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Tesla shareholders widely follow the recommendations of the board of directors at the annual meeting

Tesla shareholders widely follow the recommendations of the board of directors at the annual meeting

Aug 4 (Reuters) – Tesla Inc (TSLA.O) Shareholders voted in favor of the board’s recommendations on most issues at the company’s annual meeting on Thursday, including the re-election of board members and approval of a stock split, while rejecting proposals focused on environment and governance.

Votes on three of the 13 proposals did not follow the board’s recommendations, according to preliminary statistics presented at the annual shareholder meeting in Austin, Texas.

Despite the board’s opposition, shareholders approved an advisory proposal that would increase investors’ ability to nominate directors.

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Two board proposals — reducing board member terms to two years and eliminating absolute majority requirements — did not receive the supermajorities needed for success.

Dressed in black, CEO Elon Musk made a huge impact on the vote and spoke to an enthusiastic audience after the vote. He owns 15.6% of Tesla, according to Refinitiv data, after selling millions of shares last year. Read more

Investors agreed to split the stock three for one. While a split does not affect the fundamentals of the company, it can boost the stock price by making it easier for investors to own the stock.

Shareholder proposals that failed included those that advocated upholding the right of employees to form a union, and required the company to report annually on its efforts to prevent racial discrimination and sexual harassment, as well as to report water hazards.

A proposal requiring directors to enable large and long-term shareholders or groups with at least 3% of the shares to nominate directors, with the objections of the Board of Directors. The board had previously said such a proposal could create opportunities for private interests to misrepresent Tesla’s plans.

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Musk said that the company aims to achieve a production run rate of two million cars annually by the end of 2022 and will continue to build factories.

Tesla has plants in California and Shanghai and is condensing two more in Austin, Texas and Berlin. Musk said that Tesla may be able to announce an additional plant this year and eventually predicted it will have 10-12 so-called Giga factories.

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Additional reporting by Ankur Banerjee and Akash Sriram in Bengaluru; Additional reporting by Peter Henderson in Oakland and Kevin Kroliky in Detroit; Editing by Anil de Silva

Our criteria: Thomson Reuters Trust Principles.