Apple CEO Tim Cook’s pay cut really doesn’t make him poor
There’s a vast wealth divide between the tens of millions given in compensation to executives and the inflation-driven decline in what employees take home. That’s visibly illustrated on reports Apple CEO Tim Cook takes home perhaps 700 times more than the average Apple employee, even after a 50% pay cut.
What’s the story
An Apple regulatory filing tells us Apple CEO Tim Cook is expected to take a 50% pay cut to around $49 million.
“The compensation committee balanced shareholder feedback, Apple’s exceptional performance, and a recommendation from Mr Cook to adjust his compensation in light of the feedback received,” Apple said.
The shareholder advisory service Institutional Shareholder Services said Cook was paid 1,447 times more than the average Apple employee until the cut.
- He asked for this adjustment in response to shareholder feedback
- Shareholders were disappointed at falling stock price, down c.23% on the year.
- Cook took home $99.4m in 2022 and $98.8m in 2021.
- Cook’s base salary is $3 million with an additional $6 million bonus.
The salary does include hefty costs you’d expect to be paid to protect a CEO of Cook’s stature, including over $1.3 million for personal security and international transportation.
A symptom or a cause?
It’s to Cook’s credit he suggested the pay cut himself, but it’s still a phenomenal amount of cash to earn in comparison to average wages.
While I think Cook provides demonstrably excellent leadership of the company – even in the current economic climate – and believe in the principles which Apple under his leadership represent, the story is visible evidence of the challenges most of us have considering executive compensation.
Cook doesn’t strike me as someone who cares for wealth for its own sake.
Indeed, he has told us that he plans to donate his fortune to charity, after ensuring his close relatives are provided for. All the same, the possession of such vast tracts of wealth across the billionaire class doesn’t seem to do too much for everyone else.
If wealth represents resources, then vast sums left banked should surely be better used in social enterprise, education and a raft of other schemes designed to take chunks out of the big problems we face, rather than gathered in thrall to the sickness of Ayn Rand (which isn’t to say I see Cook as a devotee of that person, though others in the valley might be). A good exploration around some of these questions is available here.
Apple will hold its virtual 2023 Investor Meeting on March 10.
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