Apple CEO Tim Cook receives a 40% pay cut after shareholder vote

Apple Inc. CEO Tim Cook speaks at the “First Tool-In” ceremony at the TSMC facility under construction in Phoenix, Arizona, Tuesday, December 6, 2022.

Kaitlyn O’Hara | Bloomberg | Bloomberg | Getty Images

apple CEO Tim Cook will cut total compensation to $49 million in 2023, the company said in an SEC filing.

Cook requested a change, Apple said in a filing, following a shareholder vote on his salary package. The company has also reduced the number of restricted stock units Cook will receive if he retires by 2026.

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In 2022, Cook earned just under $83 million in stock compensation, $12 million in incentives, and $3 million in salary. He also got benefits like retirement plan contributions, security, personal air travel, and cashing out of his over $46,000 vacation.

Apple’s compensation committee said it made the change in response to last year’s say-on-pay vote: 64% of shareholders who approved Cook’s compensation increased from 95% who approved it in Apple’s fiscal year 2020. Diminished.

Still, Apple’s board praised Cook’s performance and said it was confident in the CEO’s long-term strategic decisions.

Recently, there has been increasing pressure from institutional investors on executive compensation. At last year’s annual shareholder meeting, Institutional Shareholder Services advised Apple shareholders to vote against Cook’s compensation package.

A compensation committee made up of Art Levinson, Al Gore and Andrea Jung reached out to institutional investors to assess how they felt about Cook’s compensation.

“Based on these key conversations, we have made changes to the size and structure of Tim’s 2023 compensation,” the committee wrote.

More changes are likely.

“Given Apple’s comparative size, scope and performance, the Compensation Committee plans to position Mr. Cook’s annual target compensation between the 80th and 90th percentiles relative to future major peer groups,” it said. the commission said.

Cook is paid primarily in restricted stock units. The actual number of shares of his Apple stock that Cook will vest will depend on his Apple performance against the S&P 500.

Since Cook took over as CEO in 2011, Apple’s stock has rebounded 1,212% against the S&P 500’s 290%, Apple said.

In addition to lowering the overall target, by 2023, 75% of Cook’s vested stock will be linked to Apple’s stock price, instead of 50%.

Apple announced in September 2020 an equity grant to Cook through 2025. Cook received it on the first day of his Apple’s 2021 fiscal year, which started at the end of September. If Apple hit all its targets when it was approved, Cook’s stock grant would have given him 1 million of his shares, worth about $114 million at the time.

Cook’s previous stock grant from 2011 was worth more than $900 million in Apple’s September 2020 stock price.

Cook said in 2015 that he plans to donate his fortune to charity.

look: Apple sees app store performance growth slowing.

Apple sees app store performance growth slowing.

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