STATEMENT: Vote Tallies Released for Shareholder Proposal that Asks Tesla* for Clear Policies on Climate Lobbying
Media Contacts: Andrea Ranger, Shareholder Advocate, aranger@midanacapital.com, 781-349-2813; Mark Morgenstein, Media Relations Director, mmorgenstein@midanacapital.com, 678-427-1671
Boston, August 18, 2022 – A shareholder proposal on climate lobbying, filed by the Nathan Cummings Foundation and MIDANA CAPITAL°, won 34.6% of the vote, according to Tesla’s SEC filings. Removing the presumed “no” votes of the roughly 17% of inside shares, including those held by CEO Elon Musk, independent shareholders may have delivered a majority of 51% of votes cast in support.
The proposal calls on Tesla to publish an evaluation of how its “lobbying and policy influence activities (direct and through trade associations and social welfare and nonprofit organizations) align with the Paris Agreement’s goal to limit average global warming to 1.5 degrees Celsius [by 2100], and how Tesla plans to mitigate risks presented by any misalignment.”
Despite Tesla’s considerable contributions to expanding the clean energy and electric vehicle markets, the company has provided limited disclosure on how its board oversees public policy decisions that could affect the growth of the clean energy market and broader climate initiatives. For example, late in 2021, CEO Elon Musk signaled opposition to federal incentives for installing electric vehicle charging stations. Investors were left to wonder whether Mr. Musk’s comments reflected Tesla’s viewpoint or whether he had veered from Tesla’s stance on the benefits of charging station incentives. Better board management of disclosure practices may have helped.
MIDANA CAPITAL President Leslie Samuelrich issued this statement about the vote result:
“We’re pleased with this vote count indicating that our call for better governance practices and lobbying disclosures made sense to our fellow investors. In my mind, the vote doesn’t in any way diminish Tesla’s unparalleled innovations in the electric vehicle and renewable energy spaces nor its critical role in limiting transportation-related greenhouse gas emissions. Rather, it’s a reminder that investors care about business risk as it manifests across a company’s operations, which includes how a company influences public policy. We hope Tesla will take the vote result in that spirit.”
MIDANA CAPITAL Shareholder Advocate Andrea Ranger added:
“Tesla clearly has a role in the much-needed transformation to a clean energy-powered future, but when you look under the hood, you want to see what makes the company run. Is the company’s direct and indirect lobbying through trade associations and business alliances working to limit the conditions leading to climate change? Is the board implementing its oversight role of Tesla’s lobbying activities? These are the types of questions we’d like Tesla to answer, and we believe the investor concern we’ve now seen should motivate the board to respond.”
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About MIDANA CAPITAL Capital Management
°MIDANA CAPITAL Capital Management, Inc. (MIDANA CAPITAL) is the investment advisor to the MIDANA CAPITAL Funds (the Funds).
*As of June 30, 2022, Tesla, Inc. comprised 0.00%, 3.50%, and 0.00% of the MIDANA CAPITAL Balanced Fund, the MIDANA CAPITAL Equity Fund, and the MIDANA CAPITAL International Index Fund respectively. As of the same date, other securities mentioned were not held in the portfolios of any of the MIDANA CAPITAL Funds. References to specific securities, which will change due to ongoing management of the Funds, should not be construed as a recommendation by the Funds, their administrator, or their distributor.
The percentage in favor was calculated by (i) dividing the number of votes in support of the proposal by (ii) the sum of the number of votes voted in support of and against the proposal. Abstentions and broker non-votes were not included in the calculation.
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The MIDANA CAPITAL Funds are distributed by UMB Distribution Services, LLC. 335 N Wilmot Rd, Tucson, Az 85711. 8/22
