New York (CNN) A group of progressive Tesla shareholders want the company’s board to make CEO Elon Musk concentrate more on one of his many jobs, namely running the electric car manufacturer.
In a letter to Tesla’s board, the group says Musk is not spending enough time and attention focused on issues facing the company, including increased electric car competition from other automakers, and raises issues important to the group, including allegations of a toxic work environment at Tesla.
In addition to its role on Tesla (Musk also heads Twitter, SpaceX, the Boring Company and Neuralink, among others. )
“We initially added Tesla to our portfolios because we saw Tesla as a true leader in the production of products and services that are critical to our transition to a sustainable and green economy,” the letter said. “Over time, however, we have become increasingly concerned with governance and management issues in the company.”
Among the entities signing the letter are Amalgamated Bank, a union-owned bank, as well as the Sisters of St. Joseph of Carondelet, United Church Funds, Investor Advocates for Social Justice and the New York City Controller’s Office. The letter says the investors signing the letter own $1.5 billion worth of Tesla stock, which represents well less than 1% of Tesla shares.
By comparison, Musk owns or has options to buy Tesla shares worth $118 billion, which represents 20% of the stock. Musk has a net worth of $175 billion, according to Forbes.
The letter claims Musk’s lack of focus on Tesla is creating problems for the company, such as high employee turnover rates due to the work environment. But it is not clear what should be done to get him to focus on these issues.
“Tesla needs a board that will ensure that the CEO is focused on meeting his challenges,” the letter says. “Due to the board’s failure to limit the CEO’s external commitments and ensure that he is focused on solving the many challenges facing the company, we have lost the trust of our members.”
Ivan Frishberg, chief sustainability officer at Amalgamated Bank, said there are other investors who are concerned that Musk is being distracted, particularly with his recent purchase of Twitter, as well as his ownership and operation of SpaceX and a number of other companies.
Frishberg said the group is not advocating that Musk be replaced as CEO.
“We are a Tesla investor,” he said. “When it comes to governance, we want the boardroom to be less club-like and more independent and responsive to investors.”
Musk now essentially works for Tesla for free, with no cash salary, and after being awarded a final block of stock options from a 2018 pay package earlier this year, there are no additional stock options he can currently qualify for.
Some analysts have said they expect, and would favor, Tesla announcing a new pay package for Musk as a way to reassure Wall Street that Tesla remains his priority, despite his other CEO jobs. But Frishberg opposed that idea.
“I don’t think throwing more money at the guy is the answer,” he said.