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Why Elon Musk’s Compensation Plan Wouldn’t Work for Most Executives

Harvard Business

He is awarded shares in his own company, where the number of shares that he receives (that “vest”) depends on whether he hits certain performance targets for Tesla’s market value, revenues, and profits. The higher the stock price in 2028, the more these shares are worth – even if the actual number of shares is fixed.

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Elon Musk’s Unusual Compensation Plan Isn’t Really About Compensation at All

Harvard Business

Musk’s compensation plan, which will give him close to $56 billion in stock and awards if Tesla’s market cap reaches $650 billion, is designed to communicate a particular value proposition to Wall Street. Maintaining that patience requires constant focus on that north star of a half-a-trillion market value.