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Tesla risks violating Texas governance rules if it doesn’t schedule its annual shareholder meeting.
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Twenty-seven institutional shareholders signed a letter demanding that Tesla hold its meeting.
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Tesla faces declining sales and share prices amid concerns over CEO Elon Musk’s political focus.
Tesla risks violating a corporate governance rule in Texas, and shareholders are sounding the alarm.
The EV maker, which was incorporated in the state of Texas in 2024 after leaving Delaware, has yet to schedule its annual shareholder meeting, which by state law must occur within 13 months of the last one.
ForTesla, that deadline is Sunday, July 13.
In a letter obtained by Business Insider sent four days ahead of the deadline, a group of investors managing $1.5 trillion in collective assets is demanding that Tesla publicly announce an “Annual General Meeting” date, disclose access details, and give shareholders “sufficient time and information to engage meaningfully in the governance process.” “This lack of transparency raises serious concerns about the company’s respect for shareholder rights,” the letter said. “As fiduciaries, we believe strong corporate governance and responsive board oversight are foundational to long-term company success.”
The letter is signed by 27 shareholders, including multiple large pension funds and state treasurers, such as New York City Comptroller Brad S. Lander, Oregon State Treasurer Elizabeth Steiner, and State of Maryland Comptroller Brooke E. Lierman. International funds from Denmark and Sweden, such as the Friends Fiduciary Corporation, a Quaker-aligned investment firm, have also signed on.
The letter and Tesla’s impending deadline were first reported by the New York Times.
Kevin Thomas, CEO of Shareholder Association for Research and Education, the main signatory of the letter, told Business Insider that he has yet to hear back from Tesla.
Tesla did not respond to a request for comment.
Thomas, in charge of the Canada-based advocacy group that advises funds with $150 billion in assets, told BI that corporations usually provide notice at least two weeks ahead of a meeting, but Tesla has yet to do so “as the clock starts to tick.”
“We definitely are concerned about the global drop in sales, the share prices tanking, and the CEO’s attention span,” Thomas said. “So that’s why we want to have the meeting, not just because we like going to meetings, but because we actually think there are things that need to be discussed with shareholders in a transparent and accountable way.”
