Tim Cook, chief govt officer of Apple Inc., speaks throughout a “First Tool-In” ceremony on the TSMC facility beneath development in Phoenix, Arizona, on Tuesday, Dec. 6, 2022.
Caitlin O’Hara | Bloomberg | Getty Images
Apple CEO Tim Cook will obtain a pay reduce in 2023 to $49 million in whole compensation, the corporate mentioned in a submitting with the SEC.
Cook requested the change, Apple mentioned within the submitting, following a shareholder vote on his pay package deal. The firm additionally diminished the variety of restricted inventory items Cook would obtain if he retires earlier than 2026.
In 2022, Cook made just below $83 million in inventory awards, $12 million in incentives, and $3 million in wage. He additionally received advantages together with retirement plan contributions, safety, private air journey, and over $46,000 in trip cash-out.
Apple’s compensation committee mentioned that it made the change in response to final 12 months’s say-on-pay vote, during which 64% of shareholders accredited of Cook’s compensation, down from 95% that accredited it for Apple’s 2020 fiscal 12 months.
Still, Apple’s board praised Cook’s efficiency, and mentioned it has confidence within the CEO’s long-term strategic choices.
Executive compensation has come beneath rising stress from institutional shareholders of late. Institutional Shareholder Services beneficial that Apple shareholders vote towards Cook’s pay package deal ultimately 12 months’s annual assembly.
The compensation committee, comprised of Art Levinson, Al Gore, and Andrea Jung, mentioned it reached out to institutional shareholders to gauge how they felt about Cook’s pay.
“Based on these important conversations, we have made changes to the size and structure of Tim’s 2023 compensation,” the committee wrote.
More alterations may very well be in retailer.
“Taking into consideration Apple’s comparative size, scope, and performance, the Compensation Committee also intends to position Mr. Cook’s annual target compensation between the 80th and 90th percentiles relative to our primary peer group for future years,” the committee mentioned.
Cook is paid principally in restricted inventory items. The variety of precise shares of Apple inventory that Cook vests relies on Apple’s efficiency versus the S&P 500. Apple’s inventory has completed properly sufficient that Cook sometimes vests the utmost quantity.
Since Cook took over as CEO in 2011, Apple inventory has returned 1,212% versus 290% for the S&P 500, Apple mentioned.
In addition to decreasing the whole goal, 75% of Cook’s vesting shares shall be tied to Apple’s inventory efficiency in 2023, as a substitute of fifty%.
Apple introduced a inventory grant for Cook in September 2020 operating by 2025. Cook obtained it on the primary day of Apple’s fiscal 2021, which began on the finish of September. When it was accredited, Cook’s inventory grant would have given him 1 million shares price about $114 million on the time if Apple had been to hit all its targets.
Cook’s earlier inventory grant from 2011 ended up being price greater than $900 million at Apple’s September 2020 share value.
Cook mentioned in 2015 that he plans to donate his fortune to charity.
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