SpaceX Rebuked by Activist Shareholder Over Governance Structure

An activist shareholder group cautioned investors against purchasing SpaceX stock when it goes public, as the company’s unusual governance structure leaves shareholders few avenues to hold management accountable.

Concerns about Space Exploration Technologies Corp. include CEO Elon Musk’s overwhelming voting power, a mandatory arbitration policy for shareholder lawsuits, and ownership thresholds for shareholder proposals, according to a Friday letter from SOC Investment Group.

“Investors should be wary of forgoing seemingly all of the accountability mechanisms that have been associated with the term ‘corporate governance’ for the past half-century,” the letter said.

SOC’s note, which ...