Apple CEO Tim Cook will receive a pay cut of 40% in 2023

  • 13-January-2023

According to Apple's annual proxy statement (PDF), Tim Cook is getting paid around 40% less than last year, and the CEO himself recommended it. It would appear that only 64% of the "Say on Pay" votes cast at the tech company's annual shareholder advisory meeting in 2022 were in favor of keeping the executives' pay packages from 2021. Even though that is still the majority of votes, it shows a significant decline in approval year over year. 94.9 percent of shareholders who voted in the previous year were in favor of the executive compensation proposals, as noted by 9to5Mac.

Apple's Compensation Committee considered Tim Cook's own recommendation "to adjust his compensation in light of feedback received" when determining this year's pay packages. Cook's target salary for 2023 is $49 million, down $35 million from his 2022 goal. While his equity award value increased from $75 million in 2022 to $40 million this year, his base pay remains at $3 million and his annual cash incentive remains the same at $6 million. In addition, as opposed to 2022's equity award, which vests 50/50 on performance and 25/25 on time, he received an equity award.

Cook, who pledged a few years ago to donate his fortune to charity, will likely earn more than $49 million this year from stock awards and bonuses, which is the truth. Bloomberg says that in 2022, he made $99.4 million, $15.4 million more than his target salary for the year. His total compensation in 2021 was $98.7 million. Before, critics like the advisory firm Institutional Shareholder Services urged shareholders to vote against Cook's pay package because they were concerned about the size and structure of his equity award. The company previously stated that "Half of the award lacks performance criteria." This change in Cook's compensation demonstrates a shift in public opinion regarding executive compensation, and the CEO may be leading by example. After all, it is not common for an executive of this level to advocate for lowering their own compensation.

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