Aug 4 (Reuters) – Tesla Inc ( TSLA.O ) shareholders voted in favor of board recommendations on most issues at the company’s annual meeting on Thursday, including re-electing directors, approving a stock split, while rejecting proposals focused on the environment environment and governance.
The vote on three of the 13 proposals did not follow the board’s recommendations, according to preliminary results presented at the annual shareholder meeting in Austin, Texas.
Despite board opposition, shareholders passed an advisory proposal that would have increased investors’ ability to nominate directors.
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Two of the board’s proposals — shortening director terms to two years and eliminating supermajority requirements — failed to receive the supermajorities needed to pass.
Dressed in black, CEO Elon Musk heavily influenced the vote and spoke to an enthusiastic crowd after the vote. He owns 15.6 percent of Tesla, according to Refinitiv data, after selling millions of shares last year. Read more
Investors approved the stock split three-for-one. While the split doesn’t affect the company’s fundamentals, it could boost the stock price by making it easier for investors to own the stock.
Shareholder proposals that failed included ones that argued for endorsing employees’ right to unionize, requiring the company to report annually on its efforts to prevent racial discrimination and sexual harassment, and water risk reporting.
A proposal requiring directors to allow large and long-term shareholders or groups with at least 3% of the shares to nominate directors overcame board objections. The board previously said a proposal like this could create opportunities for special interests to distort Tesla’s plans.
Musk said the company aims to reach a production rate of 2 million cars a year by the end of 2022 and will continue to build factories.
Tesla has factories in California and Shanghai and is expanding two more in Austin, Texas and Berlin. Musk said Tesla may be able to announce an additional factory this year, and he expects to eventually have 10-12 so-called gigafactories.
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Reporting by Ankur Banerjee and Akash Sriram in Bengaluru; additional reporting by Peter Henderson in Oakland and Kevin Krolicki in Detroit; Editing by Anil D’Silva
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