QuantumScape Corp., a solid-state battery company that debuted on the bourses last year via a blank-check deal, authorised a multibillion-dollar compensation plan for its top executive that one proxy adviser described as “staggering.”
According to estimates by proxy advice firm Glass Lewis, CEO Jagdeep Singh may get possible stock options worth up to $2.3 billion, under the agreement, if the company meets certain agendas.
The package passed in a preliminary vote during a webcast of QuantumScape’s annual shareholder meeting on Wednesday, and the company said a final tally would be available later.
“We strongly believe in setting challenging, hard-to-achieve goals, and then focusing efforts to make them happen,” defending the action, QuantumScape said in a letter to shareholders. “This is why we based this new award on stretch goals and why we gave our key executives the ability to share the upside in a way that is commensurate with the difficulty of achieving them.
In a recent report, Glass Lewis, who had recommended stockholders to deny the package, said, “The disclosed dollar value cost of the grant is staggering.” Another consulting firm, Institutional Shareholder Services, was also against it.
Big pay packages are becoming a new-age fashion among fast-growing businesses, especially after Tesla poured in investment into the electric car sector.
According to Dayna Harris, a partner at executive compensation company Farient Advisors, Such pacts echo the compensation agreement that helped make Tesla CEO Elon Musk the world’s richest person.
Last year, at least 15 business executives won accolades worth $100 million or more, up from three when Musk earned his in 2018.