Apple (NASDAQ:AAPL) fan boys and digerati alike were all asking (possibly to Siri), “What’s up with Apple CEO Tim Cook’s ridiculous compensation package?”
The compensation package, released Monday, showed a grand total of $378 million for the new leader of the second-most valuable company in the world behind Exxon Mobile (NYSE:XOM) – Apple has a whopping $100 billion in revenue and a $400 billion market capitalization.
How did this number come to be? $900,000 is his actual salary (don’t faint yet) and $377 million is being awarded to him in stocks.
And we wonder why the Occupy Movement is pulling their hair out.
Just look at this fun little statistic. CEO pay in 2010 was an astounding 343 times that of their blue collar counterparts — compared to 42 times that of blue collar workers in 1980). If you consider Steve Jobs famously took home $1 a year, Cook’s total compensation is 378 million times what Jobs made.
Now, I wouldn’t have considered Steve Jobs to be a blue collar worker, but with Cook at the helm anything’s possible.
Yes, Steve Jobs had a $1 salary, in part, because he was a large shareholder in Apple stock. He held on to an option grant after returning to the company in the late 1990s, which grew exponentially thanks to Apple’s successful turnaround — by 2011 it was worth several billion dollars. But can you blame him for having large amount of stock in a company he co-founded?
Another item to take into account is the stock grant awarded to Tim Cook wasn’t to reward him for a year’s work, it’s most likely to give him the incentive to succeed over the course of many years with the company. Some may argue $378 million spread over 10 to 15 years makes the compensation package look more in line with what other exorbitant amounts fat cat CEOs make in America. But, this doesn’t necessarily make it right.
The last time I checked, the economy was still in the crapper and, despite the unemployment rate dropping to 8.5% and consumer spending and borrowing picking up, I’m still inclined to think that in order to improve the economy, the underlings, peons, blue collar or whatever-you-want-to-call-them workers should be getting their fair share, or should be seeing a lot more fellow employees popping up over the next few years.
Forget Obama, with the kind of money these CEOs are making, they sure as hell can afford to hire a Joe Everyday or two, or three, or thousand.
- Andrew Lander, InvestorPlace.com @andrewlander