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Another reason may be to avoid a conflict of interest - Tim Cook, as the one ultimately responsible for commencing the payment of dividends, would be paying him
by Luc 14y ago
Another reason may be to avoid a conflict of interest - Tim Cook, as the one ultimately responsible for commencing the payment of dividends, would be paying himself a rather large bonus out of the company cash.
- DrJokepu 14y agoI really don't see how that would be a problem; it's not like anyone would doubt that Tim Cook is not worth that money for Apple or that Apple couldn't afford that money. I don't think anyone on the board of Apple would have a problem with Cook getting his share of the dividend.
- georgespencer 14y agoThe board of Apple has nothing to do with this. Apple is a public company. So is Questcor Pharma. Apple is a very public company. They are overanalysed, over-reported, and over-bullshitted by the tech, financial and news press. Their share price organically trades down quite frequently as a result of this. Remember the "oh fuck it's not an iPhone 5 it's just an iPhone 4S" share price? A big part of Apple's leadership focus at every level is managing expectations. Tim Cook has a major role to play in managing the expectations of people internally, of course, but also externally. And here he's done that by avoiding any hint of impropriety. No Gizmodo headlines. No peroxide CNBC gristleheads asking so-called experts "So, David, Tim Cook institutes dividends and then receives $75m himself? Are the shareholders gonna put up with that?!" This is an excellent, excellent piece of management. And I bet it's worth nearly $75m in avoided short term down trading to Cook's stock package.
- phaus 14y agoOf course the shareholders would put up with it, they have been hoping for dividends for a long time now. It's not like Tim Cook would be giving himself a bonus, the money is already his. Part of his compensation at Apple is his stock, so He should have taken the dividends that were owed to him. Anyone who would be upset by that should either start donating a portion of their salary to whomever they work for, or quit complaining.
- georgespencer 14y agoYou miss the point. The majority of shareholders would put up with it in the main. The tech press, hungry for an Apple story, would not. A minority of shareholders might react badly. Therefore the smart thing is not to stupidly say "give a portion of your salary to whomever you work for if you don't like it", but to avoid the issue altogether.
- phaus 14y agoI understand that the media may try to portray it in a negative light, but it's a ridiculous position to take. When Cook became the CEO, he was issued more stock, this implies that the company wants and expects for him to profit off of any potential earnings it may bring him. Tim Cook can give away his money however he likes, but 75 million dollars is still a huge amount even if one is a billionare.
- iProject 14y agoAnother way of putting this would be: Leadership. Apple comes into a lot of criticism for the constraints that it puts on its employees. If I were an Apple employee, Cook’s action here (omitting financial gain form himself) would be a valuable demo to me of commitment to employees' welfare.
- joelrunyon 14y agoExactly. I hate how the author automatically assumes the worst about Cook and that it has to do with taxes (even if it did, I'm pretty sure 75 million - (whatever taxes incurred) is still quite a few million). I think it makes sense and is a solid move that he recognizes that he's issuing the dividends and that taking them could appear as a conflict of interest. If I was an Apple employee, I would be impressed.
- brown9-2 14y agoDoesn't every corporation with a CEO face this same conflict? I think that is what compensation committees of the board of directors are for.