Apple Inc is cutting CEO Tim Cook’s compensation by more than 40 percent to US$49 million this year, citing investor guidance and a request from Cook himself to adjust his pay.
As part of the changes, the percentage of stock units awarded to Cook and tied to Apple’s performance would increase to 75 percent this year from 50 percent, as well as in future years, the company said in a regulatory filing on Thursday.
Last year, Cook received compensation of US$99.4 million, including US$3 million in base salary, about US$83 million in stock awards and a bonus. That was up slightly from 2021, when his total pay package was US$98.7 million.
Photo: AFP
Cook’s latest pay was based on “balanced shareholder feedback, Apple’s exceptional performance and a recommendation from Mr. Cook,” the iPhone maker said in the filing.
The company also plans to “position Mr. Cook’s annual target compensation between the 80th and 90th percentiles relative to our primary peer group for future years,” Apple said.
Apple has drawn criticism from groups such as Institutional Shareholder Services (ISS) about Cook’s previous compensation package, but a majority of shareholders voted to approve it last year.
Photo: REUTERS
ISS, a top advisory firm, said that Cook’s stock would continue to vest post-retirement and that half of the rewards did not depend on performance criteria such as the company’s share price.
The US$49 million in target compensation includes the same US$3 million salary and US$6 million bonus as last year, as well as an equity award value of US$40 million.
His equity award value last year was US$75 million.
Cook’s actual total compensation for this year could fluctuate based on the company’s stock performance.
Cook, 62, has pledged to give away his wealth to charitable causes.
It is rare for CEOs to recommend their own compensation be docked. Pay packages have gotten increasingly lavish, and 2021 was a record year for executive compensation, Bloomberg data showed.
However, shareholders have increasingly pushed back on such packages.
A record number of so-called say-on-pay votes failed in 2021, which might have reflected shareholders’ frustrations with how companies performed during the COVID-19 pandemic, financial services company Mercer said.
Apple also disclosed last year’s compensation for chief financial officer Luca Maestri, general counsel Kate Adams, retail head Deirdre O’Brien and chief operating officer Jeff Williams. Those executives were all paid about US$27 million — including salary, stock and a bonus — last year, slight increases from the previous year.
The Cupertino, California-based technology giant also announced that its annual shareholder meeting would take place virtually on March 10.
Apple shares declined 27 percent last year, although that was less of a drop than the one posted by the tech-heavy NASDAQ Composite Index.
Apple shares have climbed 2.7 percent so far this year.
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