SAN FRANCISCO (Reuters) -Apple Inc said in its annual power of attorney filing on Tuesday that it will change executives’ cash bonuses based on whether executives act within the company’s social and environmental values.
But the iPhone maker did not specify how it will assess progress toward the company’s publicly stated goals, such as removing carbon from the supply chain.
Apple lists six values that include environmental practices, such as the use of recycled materials in products, the diversity and inclusion between the workforce, and the privacy and security of its devices.
“Starting in 2021, an environmental, social and governance modifier based on Apple Values and other key community initiatives will be incorporated into our annual cash incentive program,” the dossier said.
Apple has stated that its minimum performance requirements, targets and maximum cash bonus payments to executives will not change.
But its board’s compensation committee will use the new modifier to increase or decrease bonus payments by up to 10% “based on the performance compensation committee’s assessment of our appointed directors for Apple values and other key community initiatives in time 2021. ”
The submission did not detail how the committee will evaluate the directors based on the progress made towards Apple’s publicly announced goals in terms of its values.
In July, Apple said it intends to eliminate carbon emissions from its entire business, including products and the expanded supply chain, by 2030. At the time, the company said it aims to achieve 75% of its goal by reducing emissions, with the remaining 25% coming from carbon removal or offset projects, such as tree planting and habitat restoration.
Apple cited the new modifier in its recommendation to vote against the shareholders’ proposal to reduce the executive’s salary relative to the average salary of Apple employees. Executive Director Tim Cook’s 2020 compensation of $ 14.8 million was 256 times higher than Apple’s median compensation of $ 57,783.
“US executive compensation is neither responsible for society nor sustainable for the economy, especially in the context of the current pandemic crisis. The reduction of salary ratios (called the executive officer) should be included in the principles of the executive compensation program “, the proposal states.
Reporting by Stephen Nellis in San Francisco Edited by Chris Reese and Matthew Lewis