Tim Cook will take a significant pay cut in 2023 after pushing for his pay to be changed in response to feedback and criticism from Apple’s stakeholders. Apple today released its annual proxy statement for investors, revealing a range of details about executive compensation, shareholder proposals and more.
Even if Tim Cook voluntarily accepts a massive salary cut for 2023, he still enjoys a number of other benefits. For example, he will continue to have a private jet available for all business and private trips.
The report released along with the statement revealed that Tim Cook will have “target compensation of $49 million” in 2023, down about 47 percent from what he earned in 2022.
Cook’s 2023 target total compensation has been set at $49 million, a reduction of more than 45 percent from his 2022 target total compensation. Taking into account Apple’s comparable size, scope and performance, the Compensation Committee also intends to position Cook’s target annual compensation between the 80th and 90th percentile relative to our primary peer group for the coming years.
The Compensation Committee of the Apple Board of Directors is responsible for matters such as executive compensation. According to today’s filing, Cook himself recommended adjusting his compensation structure based on feedback received as part of the Compensation Committee’s Say on Pay poll and vote.
Before the beginning of each financial year, the Compensation Committee assesses and decides on compensation. The results of the 2022 advisory vote on Say on Pay resulted in broader shareholder engagement for executive pay in 2022 of approximately 53% of institutional shares held. Apple’s outstanding performance, comments from shareholders and Cook’s proposal to adjust his compensation in light of the feedback received were all considered by the Compensation Committee.
In 2021, Tim Cook received approximately $98 million in total compensation. 64 percent of the votes cast at next year’s shareholder meeting were in favor of executive compensation in 2021.
Cook’s 2022 compensation target was $84 million, but he actually earned about $99.4 million as a large portion of his earnings are performance-related and tied to Apple’s stock.
For 2023, Cook will receive a base salary of $3 million and a $6 million annual bonus. No changes will be made to these numbers. However, as noted, much of Cook’s compensation is tied to Apple stock. For 2023, his Equity Award value has been capped at $40 million. This is less than the $75 million he made in 2022.
Cook stated in a 2015 interview that he intends to take a “systematic approach” to giving to distribute all of his wealth. He didn’t give details at the time, only explaining that he had started giving money “quietly”.
In addition to this annual compensation, a major benefit Cook enjoys is the availability of a private jet for all business and leisure travel. Out of “safety and efficiency considerations,” Apple’s board of directors passed a policy in 2017 requiring Cook to fly privately for all of his business and personal travel.
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