As Apple CEO Tim Cook battles to come to terms with falling stock price of the technology giant, shareholders protest over his pay. Apple stocks fell by around 35% from its September high and boss Tim Cook was given a 51% hike in pay last year, while other members of the management team were given big equity awards, despite disappointing results announced at the company’s annual shareholders’ meeting at Cupertino in California. One third of shareholders declined to back Tim Cook’s pay, which is set to increase to $1.4m (£923,000).
Based on votes cast before Wednesday’s meeting began in Cupertino, California, investors holding 61 per cent of eligible stock approved the advisory vote on executive remuneration. That preliminary figure is based on shares comprising around 81 per cent of the company and constitutes a majority yes vote on executive pay. The final tally on the non-binding vote, which would include votes cast at the meeting, has not yet been compiled. The rise in shareholders’ dissatisfactin comes at a time when Apple is struggling to deal with a fall in the stock price, growing competition to the iPhone and demands for greater payouts from its cash pile.
Last year, Tim Cook’s total pay package fell by 99% to $4.17m for the year to September 29, after a large one-off stock award in 2011, which vests over several years. Speaking about the disappointing annual results, Tim Cook said, “I don’t like it either. The board doesn’t like it.” In the meeting, Tim Cook also revealed that Apple planned to venture into new product lines beyond smartphones, tablets, music players and computers, but avoided specifying the details. Recent rumours indicate that Apple may be working on rumours have suggested Apple is working on a new television set, a wearable “smart watch” device, and both cheaper and larger-screened iPhones.
Another reason for the growing frustration in Apple’s shareholders is the patience-testing wait for the innovations promised by Apple amid an outlook from the company last month which implied minimal earnings growth this year. This frustration seems to have had its effect on increased protest vote over executive remuneration, amid growing debate about whether Apple should increase its payouts to shareholders.