According to the annual proxy statement (PDF) that Apple released, Tim Cook is making around 40 percent less than last year — and the CEO himself recommended it. Apparently, during the tech giant’s annual shareholder advisory meeting in 2022, just 64 percent of the “Say on Pay” votes cast on executive compensation proposals favored maintaining their pay packages for 2021. While that’s still the majority of votes, it represents a significant drop in approval year-over-year. As noted by 9to5Mac, 94.9 percent of shareholders who voted in the prior year supported the executive compensation proposals.
When deciding on this year’s pay packages, Apple’s Compensation Committee considered the poll results from Say on Pay and Tim Cook’s own recommendation to “adjust his compensation in light of feedback received.” For 2023, Cook’s target salary is $49 million, which is $35 million less than his 2022 target salary. His base salary is still $3 million and his annual cash incentive remains unchanged at $6 million, however its stock award value rose from $75 million in 2022 to $40 million this year. In addition, he was granted a stock award consisting of 75 percent performance and 25 percent time-based awards, rather than 50-50 as in 2022.
The truth is that Cook, who vowed to donate his fortune to charity a few years ago, is likely to make more than $49 million this year on the back of stock awards and bonuses. According to Bloomberg, he earned $99.4 million in 2022, which was $15.4 million more than his target salary for the year. In 2021, his total pay package was $98.7 million. Critics including consulting firm Institutional Shareholder Services previously urged shareholders to vote against Cook’s pay package, citing concerns about the size and structure of his stock bonus. “Half of the awards lack performance criteria,” the company said previously. This shift in Cook’s pay reflects changing attitudes toward executive pay, and the CEO could be an example for his peers. After all, it’s unusual for a leader at his level to recommend a cut in his salary.
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