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Strategies & Market Trends : ajtj's Post-Lobotomy Market Charts and Thoughts
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To: Qone0 who wrote (83835)1/30/2024 9:23:32 PM
From: Sun Tzu  Read Replies (1) of 97826
 
You start with the right premise and slide it to get to the wrong conclusion.

Yes, the board has a duty to ensure the interests of the shareholders are met.
And yes, the board should not give themselves exuberant compensations.

BUT in this case the board did not give themselves the comp. They contracted it with Musk on the condition to achieve what everyone thought was impossible.

In 2018, TSLA was $15. In 2022, it was 390. As a shareholder, I'd be extremely happy if any of my CEOs achieves this kind of performance and I will happily give him what he wants.

Musk is not like the other CEOs. The nearest thing to him was Jobs, though he is much better than Jobs ever was. For one thing, Jobs went around stealing ideas from everyone, and Musk originates them. Both of them were/are damn good at marketing and influencing the investors and making something out of nothing.

So in a very real sense, Musk is not replaceable - at least not easily. And it is always the case that exceptional talent demands exceptional pay. The judge did not dispute this. What he said was that since Musk already had a stake in TSLA, he would have done the hard work even if he was paid nothing.

This line of thought is so wrong that I don't know where to begin. Beyond a certain point people do not care for the money. They need something else to keep them motivated. In Musk's case it is planning a trip to Mars. Without it, he likely would not have worked as hard and he would have spent more time at his space venture or his vacuum tube trains or something else. The judge just assumes that money means that much to Musk, when there is plenty of evidence that it doesn't.
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