Members of electric vehicle (EV) maker Tesla’s (TSLA) board of directors have earned more than $3 billion U.S. in stock awards.
The massive stock award compensation given to Tesla board members was reported by Reuters (TRI) following an investigation at the news agency.
The analysis found that Tesla Chief Executive Officer (CEO) Elon Musk’s brother Kimbal has earned nearly $1 billion U.S. since 2004, based on stock options he received.
Board member Ira Ehrenpreis has collected $869 million U.S. in Tesla stock awards since 2007. And Board chair Robyn Denholm has made $650 million U.S. since 2014.
Tesla board members reaped those payments even though they haven’t awarded themselves any new stock grants since 2020.
The company’s board of directors suspended director compensation in 2021 to settle a shareholder lawsuit alleging excessive board-member pay.
However, between 2018 and 2020, the average Tesla board member received $12 million U.S. in annual cash-and-stock compensation.
That was eight times more than the average board member at Google parent company Alphabet (GOOGL), the next highest-paid among the mega-cap technology companies.
The value of the stock awards given to board members has skyrocketed along with Tesla’s share price over the years.
The size of the Tesla board members original stock awards was massive and created vast wealth for what is essentially a part-time job.
Tesla’s board members also paid themselves in stock options instead of shares, a practice criticized by corporate-governance experts because it magnifies directors’ upside potential with no downside risk.
In a written statement, Tesla said its directors’ compensation “is not excessive but directly tied to stock performance and shareholder value creation.”
TSLA stock has gained 21% this year to trade at $458.96 U.S. per share.
