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Comment by rgbrenner | Hacker News Reader

For comparison, bob igor gets paid 125k in cash and 250k in equity to serve on apples board. Or Joseph Jimenez, the former ceo of Novartis, gets paid 300k to serve on GMs board.

It’s unusual for board members to get paid over 1m. The average is less than 100k.

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not bad for doing few meetings a year

Yeah, no kidding. I have a hard time believing that the way corporate board seats are filled has anything to do with maximizing the performance of a company. It seems like it’s just an entrenched, unspoken agreement among the executive class to keep their pockets filled with walking around money—or private-jetting money in their case.

I'm sure there's a bit of that but I think for most companies it's a way to get the foot in the door at another company.

If you think company B could use your services then company A can ask their board member who just happens to also be on company B to push for it.

The right meeting decisions in a few cases can make or break. The hard part is determining which those are, and validating it years later.

I believe a wrong decision can break, but the right decision rarely "make". A simply "adequate" decision followed by brilliant execution is what really "makes". In that sense, they should be compensating the people who execute the decisions more, not the ones who call the shot.

I also believe that a lot of the "importance" of a board member comes from their social network. "Let me call the CEO of AWS and figure out what we can do"- kind of thing.

Opposed to engineers who usually face consequences on bad decisions, these rich people rarely have any meaningful accountability. So tossing a coin is fine.

And these days, probably from the extra-large kitchen with an ocean view, on Zoom.

Seems silly, if their equity goes up in value should they have to return everything over 1m?

It's not their fault that people bought the stock and made them rich.

They're returning the equivalent of 3 million stock options. They gave themselves 11 million stock options between 2017-2020, which means they're still getting around $2 billion for being on the board. They're not returning everything over $1 million at all.

https://www.reuters.com/legal/tesla-directors-settle-lawsuit...

Do you have an opinion on whether the work they've done is worth $2 billion?

>Do you have an opinion on whether the work they've done is worth $2 billion?

Their market cap went up by 1 trillion.

Again, they were just compensated in equity. It's easy to look back and criticize them as overcompensated but at the time they were just receiving equity worth a fraction of what it is today.

At the time they were getting close to 10-20x more than an typical board member of an S&P 500 company. The lawsuit was brought up before the stock took off.

Detractors seem to have short memories.

They were cash strapped and almost bankrupt, the most shorted company of all time and they paid out in equity. They were able to flip it around and become of the all time great success stories, I'd say their directors probably earned their compensation.

Board members are generally large shareholders in the company and have fiduciary responsibility in their role. They shouldn’t need to be compensated on top of the stake they already have in the success of the company.

It makes Teslas defense that it used the stock options to ensure the incentives of directors were aligned with the goals of investors. [1] kind of ridiculous. That’s literally their job and their fiduciary responsibility as a board member.

I do have to note that a “fiduciary” has a distinct meaning here.

1. https://www.reuters.com/legal/tesla-directors-settle-lawsuit...

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