Praise for Tim Cook's self-inflicted pay cut

From Jason Aten's "Why Tim Cook's $50 Million Pay Cut Is His Smartest Leadership Move Yet" posted Saturday by Inc.

Tim Cook is, arguably, the most successful CEO of his generation. For that matter, he's probably the most successful CEO of any generation. Under his leadership Apple grew from a reasonably successful company with a still relatively new hit, the iPhone, into the world's most valuable and most profitable company, ever.

A large part of that success has come from Cook's unique set of skills that have led Apple through various challenges over the past decade. As a result, he has been rewarded with what can only be described as a very generous compensation package, especially over the past few years.

His pay was just under $15 million in 2020, but it jumped to more than $98 million in 2021, and $99.4 million in 2022 when you add up his salary and stock awards. While he isn't the highest paid CEO in the world, he's doing just fine.

This year, however, as Apple prepares for its annual shareholder meeting, Cook is taking a pay cut. It's worth mentioning that the pay cut isn't in response to Cook's performance... It also seems worth mentioning that--according to Apple--Cook himself recommended the change. "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," the company said in an annual filing released Thursday.

My take: Tim Cook didn't get where he is today without knowing how to read a room.

9 Comments

  1. David Drinkwater said:
    It’s a funny thing. COVID-19 was and is a big deal, but 2020 was by far the best recent year for my portfolio.

    Now, as recessionary fears are setting in, things could get ugly. As the blood starts to build behind the dam, potentially flowing out into the streets, it’s is wise for the oligarchs to bring themselves down from the heavens. I don’t know how many people we’ve lost in my office just yet, but even on Friday, in a new quarter in a new year, we had a cull. It’s despicable.

    Tim is wise to read the room, as PED suggests.

    Plus, it’s not like he’s hurting with his current package.

    1
    January 15, 2023
  2. Gregg Thurman said:
    TC could work for free and it wouldn’t impact his life style one iota. After becoming a multi-millionaire you’re just collecting zeroes, it’s an ego enhancer.

    I applaud his “sacrifice”, but I think it’s meaningless. It makes me think of the overweight woman ordering a banana float and telling the waiter to hold the cherry on top, explaining she’s on a diet.

    Think of the affordable housing the combination of Bezos, Musk, Pinchai, Nadella, Ellison and many others, could construct with a similar ‘sacrifice”, each year, instead of buying another way over priced coastal house, yacht, or old master painting.

    TC’s “sacrifice” alone could construct two hundred $250,000 homes per year. The top 1% could build thousands, each year. Russian oligarchs could build even more. None would miss it.

    It wouldn’t impact their life styles on iota.

    9
    January 15, 2023
  3. Steven Philips said:
    Tim reads the room. Because the handwriting is on the wall! 🙂

    1
    January 15, 2023
  4. Jerry Doyle said:
    Little doubt exists in my mind that one compelling reason I remain invested “all-in” with Apple is that Tim Cook is at the helm of the mothership. It is easy to question today the corporate good and absence of personal faith we have in leaders of any profession, especially in the world of business governance. Tim Cook is one of the very few with whom I have invested much financially during my life, whom I concomitantly owe much to in recompense from my investment and continue to run strongly with him in hope of what still lies ahead. I suspect others in Apple 3.0 can say the same.

    3
    January 15, 2023
  5. Robert Stack said:
    What I think is also worth mentioning is that you never hear anyone say that TC is the best gay CEO out there in business-land, in the way that many would say (and have said) so-and-so is one of the top female CEOs, or this other person is one of the best black or hispanic CEOs, or whatever. It’s just widely recognized that TC is at the top of his game – period. His talent is so obvious that there is simply no need for these kinds of additional descriptors. Not only that, but he’s the rare CEO who actually seems to have principles that are not just focussed on the bottom line. Like Jerry perhaps, my investment in Apple is at least partly based on my continued confidence in TC’s leadership.

    2
    January 15, 2023
  6. Neal Guttenberg said:
    Like many of the others here, I applaud the move by Cook. And even though it is really window dressing to his net worth, it is still a good a decent move on his part. How many other CEOs or top level executives have given up pay? It is the reason why I vote against almost all pay packages and board members who approve these salaries. For many of these CEOs and high level executives, getting these jobs is like winning the lottery. You make a ton of money no matter how good or bad a job you may have done. At least in Cook’s case, he has done an excellent job, up till now, running the company.

    Not that it matters to anything else being discussed here, I seem to remember reading somewhere that upon his death, most of Cook’s estate will be going to charity with a small amount of the overall estate going to a nephew of his.

    0
    January 16, 2023

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