EV maker Tesla (TSLA) has been left “fragile” after giving the green light to chief executive Elon Musk’s $29 billion pay package.
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The Corporate Governance Institute said the decision to award Musk one of the largest pay deals in corporate history was a “breaking point” for founder-led governance.
Wild CEOs
The Institute’s CEO Ciaran Bollard described it as “a pivotal moment” where board independence gives way to founder worship, creating cultural, ethical, and operational fragility.
“If Musk weren’t a founder, would this package and autonomy still make sense? If the answer is no, something is broken,” he said. “This isn’t just about pay – it’s about whether boards still have the will or ability to govern today’s most powerful CEOs.”
Of course, Musk is not the founder of Tesla, but his leadership, skills and personality have helped drive the company into a U.S. titan, and its stock price and valuation to huge heights.
Bollard said that the “high-stakes” move has reignited urgent debate over the power dynamics between boards and CEOs, the idolisation of founders, and whether corporate governance is being eroded by shareholder appeasement and personality-driven leadership.
Concentration Risk
“This is more than a debate over executive pay, it’s a question of whether the board exists to steward a company in the interests of all stakeholders, or merely to endorse the will of a powerful CEO,” he said. “When a board builds its strategy around a single individual, it creates a concentration risk, not just operationally, but culturally and ethically. If that individual becomes a source of volatility, the company becomes fragile by design.”
He added that governance isn’t there to flatter founders. It’s there to protect the future of the business. “Boards must resist the temptation to view governance as an afterthought, especially in companies where public perception, investor confidence, and leadership identity are inseparable,” he said.
Indeed, Tesla’s share price has been vulnerable this year given more intense competition in the electric vehicle space, but also Musk’s on, and very much, off relationship with President Trump and flirtation with right-wing politics.
However, industry experts believe Tesla remains on the right track and on course to hit a $10 trillion valuation by the end of the decade. This will be powered by an ecosystem – see above – of EVs, robotaxis, humanoid robots and energy storage.
Is TSLA a Good Stock to Buy Now?
On TipRanks, TSLA has a Hold consensus based on 14 Buy, 15 Hold and 8 Sell ratings. Its highest price target is $500. TSLA stock’s consensus price target is $307.23, implying a 6.80% downside.
