December 29, 2012
Which Rich Nerdy White Dude Was Paid The Most This Year?
Apple: Maker of great products, inspiration for the world’s most hyperbolic headlines.
As a publicly traded company, Apple has to adhere to a few laws and regulations and mind their fiduciary duties. As such, they’ve recently filed a preliminary proxy statement with the SEC running down their financials, including how much they paid their CEO and members of the board.
Now, news sites are running amok with headlines suggesting that Tim Cook took a 99% hit in pay and, alternatively, that he was given a 51% pay raise. Either type of story make sure to mention the recent slip in APPL prices and Steve Jobs’ death, as you do.
The rub lies in stock options, when they vest and what happens in the interim.
Last year, Cook was essentially awarded $378 million, a sizable paycheck which included many millions of dollars worth of APPL stock… stock which will not vest for another 10 years or so. This was a one-time award on top of his $900,000 base salary.
As detailed in this year’s SEC filing, Cook is set to receive $4.17 million in return for a job well done in 2012.
“But wait!” you may be shouting at your computer screen.
“That number is far less than last year’s number!”
And you are correct, but it’s important to remember that Tim Cook only took the job of CEO late into last year, meaning the extra $376.2 million in one-time stock awards was more or less a signing bonus, something to entice him, to keep him interested and motivate him to stick it out for at least another 10 years.
Cook’s base salary has actually increased by 51% over last year. Apple’s financial office will write him a check for $1.36 million this year, as well as tack on a nice $2.8 million incentive plan, a package adding up to $4.17 million.
The truth is never sexy, so to dress up a news story about a rich white dude’s paycheck, these hyperbole-loving news sites have also included the size of another rich white dude’s paycheck: Peter Oppenheimer.
Apple’s CFO is set to receive $68.6 million in compensation this year, up from $1.42 million earlier this year.
Other rich white dudes also made more money than Cook, rich white dudes like Oracle’s CEO Larry Ellison.
Of course, the fact that other companies are set up to pay their executives differently is likely attributed to the fact that shares of APPL slipped below $500 this week.
Never mind the fact that APPL is still $470 higher than Microsoft and $261 higher than Amazon.
A slip is a slip, of course, and while it shouldn’t be ignored, it shouldn’t be blown out of proportion.
Nor should anyone assume that Tim Cook’s paycheck for the year of 2012 should be based on stock performance in the last week.
If this news has taught us anything, it’s that any Apple headline is a sure-fire attention grabber.
Also, Tim Cook is still an incredibly wealthy white dude.
Now all that’s left to be speculated is how Cook is going to spend his loot. Will he make hundreds of anonymous donations to NPR and build a fort out of the resulting tote bags?
Perhaps he’ll pay the cast of “Frasier” to recreate his favorite scenes in his home?
Or, and more likely, will he talk Sir Ive into finally teaching him how to play that guitar he bought for himself several years ago that just sits in his office?
Image Credit: Apple