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.”
“I’ll just say this, that shareholders shouldn’t have to rely on courts to enforce basic rights,” Thomas added of Tesla. “We’ve invested in it for a good reason, and as its returns and its sales and its performance tips, now is the time to intervene.”
Texas’ Business Organization Code states that a court in the county where the company’s principal executive office is located “may order a meeting to be held” if the company fails to hold the meeting or obtain written consent within a 13-month period. For Tesla, that would be Travis County, where its Gigafactory Texas is located.
Tesla now has four days left to schedule a meeting, or the shareholders can take matters to a judge, who could compel a meeting.
Tesla moved its headquarters to Texas from California in late 2021 after CEO Elon Musk expressed dissatisfaction with the Golden State’s COVID-19 policies and housing costs for employees. The official incorporation of the company also moved to Texas from Delaware after a state court invalidated Musk’s pay package, which was worth $56 billion at the time.
Tesla shares are down nearly 40% compared to their peak in December 2024, and down around 30% since President Donald Trump’s inauguration day. The EV giant also saw declining sales over the first two quarters of 2025.
Analysts have recently written that investors are “growing tired” of Musk’s political activities, which are seen as a distraction from his company. This follows the billionaire’s public split from Trump and his recent announcement of a new political party.
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