Apple Opposes Proposal on CEO Succession Planning
A few noteworthy nuggets from Apple’s 2011 Proxy Statement, filed today with the U.S. Securities and Exchange Commission.
In 2010 CEO Steve Jobs retained his $1 annual salary and some 5.5 million shares of Apple stock as well. “Since rejoining the company in 1997, Mr. Jobs has not sold any of his shares of the Company’s stock,” the filing reads. “Mr. Jobs holds no unvested equity awards. The Company recognizes that Mr. Jobs’s level of stock ownership significantly aligns his interests with shareholders’ interests.”
COO Tim Cook earned $59.1 million for the fiscal year, thanks to a $5 million bonus and $52.3 million in stock awards. Quite a spike from the $1.64 million he earned in 2009, but well-deserved given his performance, particularly when he filled in for Jobs during his medical leave of absence.
Included in the proxy statement is a shareholder proposal asking Apple to adopt a CEO-succession-planning policy and appended beneath it is a strongly worded statement from the company opposing it. “The Company recognizes that a highly talented and experienced management team, not just the CEO, is critical to Apple’s success,” it reads. “Accordingly, the Board already implements many of the proposed actions and maintains a comprehensive succession plan throughout the organization. While the Board strongly supports the concept of succession planning, it recommends a vote against [the proposal].”
Why?
Evidently, the board feels a written succession plan would give Apple’s rivals unfair advantage by publicizing its objectives and plans. It also fears that identifying potential successors to Jobs would invite other companies to recruit those people away from Apple. Finally, the board feels that its directors and Apple’s leadership can handle succession planning on their own. “The Company takes succession planning seriously, and the board has adopted a comprehensive process to ensure continuity and maintain the superior quality of its management team,” Apple said in the filing. “This process also allows flexibility to adjust to unanticipated changes in the market.”
Plus, Steve doesn’t like talking about it.
