Tesla’s annual shareholder meeting this Thursday could determine the future direction of both the electric vehicle giant and its high-profile CEO, Elon Musk. The company is asking investors to approve a performance-based compensation package potentially worth $1 trillion, a move that supporters say is essential to retain Musk’s leadership—and critics argue symbolizes excessive corporate dependence on one individual.

The board has mounted an aggressive campaign ahead of the vote, warning shareholders that Musk could walk away if the package is rejected. A marketing push titled “The Future of Tesla Is in Your Hands” has flooded social media platform X, echoing the company’s message that Tesla’s transformation into an AI and robotics powerhouse hinges on its founder’s continued involvement.

Tesla’s Push to Secure Musk’s Loyalty

Tesla Chair Robyn Denholm took to CNBC last week to rally investor support, insisting that the company’s next phase—centered around AI-driven transportation and robotics—depends on Musk’s vision. “We’re changing transportation with AI and the way households and workplaces will function with robotics,” she said, while Tesla’s humanoid robot Optimus handed out candy in Times Square.

The pay package, structured as a long-term performance award, mirrors Musk’s controversial 2018 plan, which was later struck down by a Delaware court. Tesla has since moved its corporate base to Texas, where the board expects fewer legal hurdles under the state’s more business-friendly governance laws.

Musk himself said during Tesla’s latest earnings call that the deal is meant to ensure his voting influence within the company. “There needs to be enough control to give a strong influence but not so much that I can’t be fired if I go insane,” he quipped, acknowledging the tension between autonomy and accountability.

The Debate Over Key Person Risk

Critics say the proposal amplifies key man risk—the overreliance of a company’s performance and value on a single executive. Advisory firms ISS and Glass Lewis have both recommended voting against the plan, citing concerns about shareholder dilution and the absence of provisions to ensure Musk remains focused on Tesla amid his growing empire, which includes xAI, SpaceX, and X (formerly Twitter).

“While the package is designed to retain Musk, there are no prescriptive elements to ensure his focus remains on Tesla,” ISS wrote. Glass Lewis added that the structure “poses significant dilution” and lacks safeguards against over-concentration of control.

Tesla responded in a post on X, calling those assessments “nonsensical” and “detached from Tesla’s unique value-creation model.” The company argues that Musk’s leadership has already generated trillions in market value and that “benchmarking Tesla against conventional corporations defies common sense.”

Still, some institutional investors, such as the State Board of Administration of Florida, have sided with the board, stating that the potential upside far outweighs the cost of dilution. Longtime Musk supporter Cathie Wood of Ark Invest added that achieving the company’s goals would make “employees and their families wealthier than they ever imagined.”

A Second Vote: Tesla’s Link to xAI

In addition to Musk’s pay package, shareholders will also vote on whether to authorize Tesla’s investment in xAI, Musk’s artificial intelligence venture behind the conversational assistant Grok. The partnership would deepen Tesla’s exposure to AI innovation but also blur the lines between Musk’s overlapping business interests.

Musk has denied plans for a full merger between Tesla and xAI but has left the door open for collaborative ventures. “I’m open to Tesla investing in xAI,” he said earlier this year, underscoring his view that AI will define Tesla’s next decade.

A Defining Vote for Tesla’s Identity

The stakes of this week’s meeting extend well beyond Musk’s compensation. They strike at the heart of Tesla’s governance and future strategic direction—whether the company can evolve into a diversified AI and robotics leader, or whether it remains synonymous with its founder.

Analysts predict the vote will likely pass, echoing last year’s results in which 72% of shareholders supported Musk’s prior compensation plan, excluding his and his brother Kimbal’s shares. A surge in retail investor participation—accounting for nearly one-third of Tesla’s base—could once again secure the outcome in Musk’s favor.

For Tesla, the decision may set a precedent not only for executive pay but also for how far investors are willing to go to retain the world’s most influential CEO—a figure whose personal brand has become inseparable from the company he built.