Tim Cook to take $40 million pay cut in 2023, Apple confirms

Apple chief executive Tim Cook is set to take a significant pay cut of around 40 per cent in 2023 according to regulatory filings from the company.

In its annual proxy statement, the company set Cook’s compensation target for 2023 at $49 million. This is compared to his 2022 compensation of $99.4 million, which was slightly higher than the 2021 total of $98.7 million.

The pay change for Cook comes after the ‘Say on Pay’ vote at Apple’s annual shareholders meeting in 2022. In the vote, only 64 per cent of shareholders approved of executive 2022 pay packages, down from 94.9 per cent in 2021.

While Cook’s compensation is being significantly reduced, his stock awards are set to be reduced further. Cook was granted $75 million in stock awards in 2022, with half of that total based on Apple’s share performance. For 2023, Cook’s stock award target has been reduced to $40 million with $30 million of the total depending on how well Apple’s shares perform. Should Apple’s shares hit performance thresholds, Cook’s $30 million in performance awards could double.

The reduction in Cook’s pay was recommended by the CEO himself, though critics such as proxy advisory firm Institutional Shareholder Services (ISS) have campaigned against his high salary. ISS argued that “half of the award lacks performance criteria.”

The move presents echoes of 2014 when the late Nintendo president Satoru Iwata took a voluntary 50 per cent pay cut in response to poor hardware sales and overall financial problems at the Mario company. Apple in 2022 performed better than Nintendo in 2014, but supply chain issues and an international cost-of-living crisis led to worse-than-expected device shipments.

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