Apple in its regulatory filing disclosed that the salary of Tim Cook were chopped out due to miss in profitability and revenue during FY 15-16. During financial year Apple generated humongous $216 Bn revenue and $60 bn profitability. The target was 224 bn and Tim Cook led team missed the target which led 15% deduction in salary.
The stringent internal policy and applicability even on CEO indicate the true reason of Apple success. The accountability and responsibilities are defined irrespective of position. Due to aggressive marketing by Chinese players and slowdown in Apple major market such as Middle East, China and Japan impacted yearly revenue target. Many big companies worldwide should learn from Apple move instead of showering millions of $ in CEO's or other management salary even though companies run in huge losses.
Tim Cook should be saluted as he accepted the salary cut even after generating $60Bn of yearly profitability. He could have easily argued that he is instrumental in successful transition from Steve Job without impacting the innovation.
I am sure that Q1 of FY17-18 will be fabulous as it will be backed by holiday season. We have seen that many leaders do not compromise on their salary front whereas investor suffer due to one or another decision of CEO. Many companies are willing to give millions of $ salary to promoter CEO without thinking about investor. Apple move should be treated as an example which will help to bring back investor confidence.
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