Investors in Apple Inc. should vote against the $99 million compensation package awarded to Chief Executive Officer Tim Cook last year, a shareholder advisory firm advises.
Half of Cook’s 2021 award is time-based and not contingent on meeting performance criteria such as increases in Apple’s stock price, Rockville, Maryland-based Institutional Shareholder Services, said in a report. In addition, even if 61-year-old Cook retired, the award would remain unconditional, ISS said in an appeal to shareholders to oppose the pay package at the company’s March 4 annual meeting.
“There are significant concerns about the design and size of the share grant to CEO Cook,” ISS said in the report.
A spokesperson for Cupertino, California-based Apple declined to comment on the ISS report.
Most of a company executive’s pay is often in the form of stock or options, and often comes with restrictions or performance criteria designed to provide incentives to stay with the company. Last year at the time, Cook received stock awards worth $82 million, as well as a $12 million cash bonus, $3 million salary, and other compensation.
It was the first payroll package Cook received after collecting a $750 million moonshot prize that Apple gave him after he bought it from Steve Jobs 10 years ago. Cook defied some critics who expected Apple’s star to fade in the post-Jobs era. Since 2011, Apple’s total shareholder return has surpassed 1,000%, raising the company’s market value to $2.8 trillion.
Apple announced in a filing last month how much it paid Cook and will now put the fee for a non-binding vote. Cook’s 2021 package included new stock prices that could net him as many as 1 million shares by 2025.
Apple has already awarded Cook a compensation package for 2022. In September, he was awarded a conditional share grant that could potentially exceed 750,000 shares.
Apple stockholders have supported Cook and other executives’ compensation in the past. At the 2021 annual meeting, 95% of the votes cast supported the executive compensation program.
The Financial Times reported on ISS’s recommendation earlier Wednesday.