Elon Musk stole the show in the final minutes of Tesla’s Wednesday earnings call to label the advisory firms pushing shareholders to reject his $1 trillion pay package “corporate terrorists.”
After months of being relatively quiet following his resignation from the Department of Government Efficiency and subsequent fallout with President Donald Trump, Musk slammed proxy advisory firms Institutional Shareholder Services (ISS) and Glass Lewis.
“I just don’t feel comfortable building a robot army here and then being ousted because of some asinine recommendations from ISS and Glass Lewis, who have no freaking clue,” Musk said. “I mean, those guys are corporate terrorists.”
Musk, in a separate X post on Wednesday, also called into question the role of proxy advisory firms generally. The Tesla CEO echoed criticism from ARK Invest CEO Cathie Wood by saying these firms—which issue recommendations to shareholders for how they should vote on proposals at public companies’ annual shareholder meetings—have too much sway, especially with passive investors like index funds, which have substantial voting power because of the shares they hold for clients.
“ISS and Glass Lewis have no actual ownership themselves and often vote along random political lines unrelated to shareholder interests! This is a major problem that is not just limited to Tesla,” Musk wrote on X.
However, advisory firms do not vote directly in annual shareholder meetings and merely recommend positions that are also individually analyzed by some of the biggest institutional investors, including BlackRock, Vanguard, and State Street, which do their own in-house research. Both ISS and Glass Lewis twice recommended voters reject Musk’s previous 2018 pay package. Shareholders ultimately approved the package twice.
A spokesperson for Glass Lewis told Fortune in a statement its job is to provide analysis and recommendations to its clients.
“Those that are Tesla shareholders will ultimately make their own decisions about Mr. Musk’s pay proposal and the Board directors that put it forward for shareholder vote,” the statement read.
ISS declined to comment. Tesla did not immediately respond to a request for comment.
Musk, who has a net worth of $455 billion, said he needs an ownership stake “in the mid-20s approximately” to achieve his goals at Tesla. The pay package in question would give Musk about $1 trillion over 10 years if he meets performance metrics, one of which includes boosting the company’s market cap more than 500% to $8.5 trillion.
ISS and Glass Lewis both issued reports earlier this month questioning Musk’s pay package, in part because of the package’s size and because it would dilute existing shareholders’ holdings.
While Tesla claimed regular benchmarking doesn’t apply to Musk’s pay, because no other company has “remotely similar goals embodied in their compensation programs,” Glass Lewis wrote in its report that Musk’s 2025 performance award is “unprecedented” compared with that of other public companies, and around 33.5x larger than its predecessor from 2018.
“It is clear that the quantum, on a realizable and granted basis, outpaces all other pay packages.”
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