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Apple Says Compliance With Company 'Values' Will Impact Executive Cash Bonuses Starting 2021

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Apple Says Compliance With Company 'Values' Will Impact Executive Cash Bonuses Starting 2021

Apple Inc (NASDAQ: AAPL) informed the U.S. Securities and Exchange Commission in a proxy filing on Tuesday that, starting 2021, it will modify cash incentive for executives to incorporate “Apple values” and community initiatives.

What Happened: Apple said that the values span environmental, social, and governance fields and the change has been made to “further motivate Apple’s executive team to meet exceptionally high standards of values-driven leadership in addition to delivering strong financial results.”

No changes are planned on the level of rewards or the threshold of performance requirements and goals, as per the Tim Cook-led company.

Apple said that its compensation committee will use the modifier to establish an increase or decrease in bonus payments by up to 10% based on the performance of executives with respect to Apple’s values and key community initiatives during the year.

Why It Matters: The consumer electronics giant pointed to the new modifier while recommending to vote against a shareholder proposal to reduce executive pay to the median employee pay at Apple, reported Reuters.

See Also: Apple Plans To Go Carbon Neutral Across Supply Chain, Products Within A Decade

Cook’s 2021 compensation will include a long-term equity award, for the first time since he was promoted to the chief executive’s post.

“This award will better align the structure of his time-based and performance-based equity incentives with the awards of our other named executive officers,” the company said.

Cook’s 2020 salary of $14.8 million is 256 times greater than the median Apple pay of $57,783, noted Reuters. In September, Cook was given his first-ever stock grant, worth over $114 million.

Price Action: Apple shares closed nearly 1.2% higher on Tuesday at $131.01 and fell 0.27% in the after-hours trading.

 

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