Advisory firm ISS urges Apple shareholders to vote for Tim Cook's pay package

Proxy advisory firm Institutional Shareholder Services (ISS) has urged shareholders of the iPhone-making company, Apple Inc, to vote for its director nominees and the pay packages for top executives at the upcoming annual general meeting on March 10.

In a research note, ISS said, "Continued monitoring of the pay program is warranted to ensure that pay magnitude is supported by a continued strong performance by the company."

The top executives' list also includes the chief executive, Tim Cook whose compensation target for 2023 was cut by almost 40 per cent to $49 million. Apple last week said Cook's pay is contingent on the company's shares performance relative to market peers, in regulatory filings with the U.S. Securities and Exchange Commission.

Additionally, Apple has also made changes to Cook's stock awards. For FY22, Apple had granted him $75 million in stock awards, half of which were based on how well Apple's shares performed. However, for FY23, Cook's stock award target has been reduced to $40 million, with $30 million of the total depending on share performance.

Apart from executive pay, the note by ISS urged shareholders and investors to vote for proposals, including a resolution demanding a report on median gender and racial pay gaps, and an amendment of proxy access rights, both of which were opposed by the company's management.

The proxy advisory firm said that support for the proposal requesting a report on the median gender and racial pay gap is warranted as it would allow investors to compare and measure the progress of the company's diversity and inclusion initiatives and gauge how it is managing related risks.

The proposed amendment to the proxy access right would enhance the company's existing right for shareholders while maintaining safeguards on the nomination process, the note by ISS added.

Last year, a proposal requesting that the company report on its gender and racial pay gaps was presented, but it was turned down by the shareholders, with 66.4 per cent voting against it.