This article is part of Technology Newsletter. You can Register here to receive it weekdays.
Apple has paid its chief executive, Tim Cook, a total of $1.4 billion since 2007. Oracle chairman Larry Ellison has amassed nearly 1.9 billion worth of stock and cash. dollars over the same period. And Mark Zuckerberg has raked in $5.7 billion from Facebook since the company went public in 2012.
This is one of the billion dollar men of the tech industry. According to a new analysis of the past 15 years, the cumulative salaries of half a dozen executives have amounted to $13.2 billion. Those were the years when technology companies became a powerful force in our economy, our lives, and world affairs. The mood on tech has taken a turn for the worse lately, but tech bosses’ wages have remained mostly unaffected.
New York Times published on Friday an analysis of the highest paid executives of publicly traded US companies in 2020. During the pandemic, executives received some of the highest pay packages from so far, my colleague Peter Eavis reports.
To get a picture of what companies have paid their bosses over a longer period of time, executive compensation consulting firm Equilar ranked 10 executives with cumulative total salaries. the highest since 2006 when there was a change in the company’s salary announcement. Tech bosses make up six of those 10 positions, largely because of the stock value their companies bring to them.
The multibillion-dollar salaries of a handful of men — and yes, they’re all men — raise a big and difficult question to answer: How do we know if they’re worth the money? are not?
Baseball stat enthusiasts know of a metric called wins on substitution, which attempts to determine a player’s worth by estimating the number of more or less wins a team has with he compared to the alternative may be cheaper. Even in the data-obsessed tech industry, there has been little effort to apply the winning surrogate metric to the corner office.
According to Equilar analysis, it’s possible that a hypothetical Alphabet replacement leader would do a better job than Sundar Pichai, with less than $1.1 billion in stock and other compensation that Google’s parent company would have. has paid him since 2015. Management usually doesn’t try to find out. Executives get paid what they get paid.
Let me dig deeper into a few CEO salary figures. Calculating how much corporate directors are “paid” is a complicated and controversial exercise. In some cases, tech bosses’ compensation is even greater than the startling numbers initially suggested.
When Cook took over Steve Jobs in 2011 as Apple’s chief executive, the company pledged to give him up to 28 million shares, after adjusting for stock splits, over the next decade. . Back then, Cook topped The Times’ annual ranking of the highest-paid CEOs, largely based on that stock’s potential $376 million value. One expert called Cook’s stock award “so historic that it skews the numbers.”
However, Cook will only take all the stock home if he survives for 10 years and if the company’s stock price rises faster than most other large companies. So what will happen? Cook is likely to collect all or nearly all of the stock, with the final installment due in August. By one calculation, that stock is now worth $3.5 billion, or nearly 10 times as much. times the “historic” figure a decade ago.
Companies often justify top executive salaries by saying that bosses are irreplaceable and that they only get rich with shareholders, because they are paid largely in stock. Cook’s wallet has been getting fatter since 2011 due to the escalating price of Apple’s stock, along with anyone who happened to buy Apple stock.
But again, it’s hard to gauge the level of Apple stock or financial performance that Cook is doing. Maybe you will do 80% as good as Cooking for a fraction of the cost.
Apple did not directly disclose the $3.5 billion figure. I verified it from Apple’s annual reports to shareholders. Equilar calculates that Cook’s cumulative compensation since 2007, when he was Apple’s chief executive, is $1.4 billion. Equilar’s figure evaluates the value of Cook’s shares in each year that it is issued to him, not the present value of those shares. As I said, there are many ways to split the CEO payout.
These figures may seem a few years away from most people’s financial situation (or a few zeros), but they also carry an interesting message for those who feel like they don’t know money.
Zuckerberg tops the Equilar rankings for long-term CEO pay, almost entirely from stock options on the 120 million shares Facebook gave him shortly after the company was founded. Zuckerberg sold about a third of those shares for $2.3 billion more than a year after Facebook went public. If he held those stocks instead, they would be worth almost $14 billion now.
But don’t lose sleep worrying about Zuckerberg selling stock at the right time. He’s still worth $124 billion.
Before we go…
About that discounted internet service… The government’s emergency funds are supposed to help lower-income Americans reduce their monthly internet bills by up to $50. News site Protocol discovered that even a small difference – such as an address entered “Street” instead of “St.” – has caused some internet companies to block those who are eligible. (The Washington Post last month wrote about other mischiefs in this internet sale.)
Break irons soldering! Vice News reports that New York could be poised to become the first US state to pass legislation that makes it easier and cheaper to repair your electronics and other things. Several product manufacturers, including Apple and John Deere, have lobbied against these “right to repair” laws that require them to give people and repair shops access to manual information. tools, and parts instead of relying solely on authorized repair vendors.
What about “The Crown” crown? To make more money, Netflix opened an online store selling merchandise related to the company and its shows, including “Lupin” throw pillows and Netflix-branded boxer shorts, my colleagues John Koblin and Sapna Maheshwari said.
Here’s a live video feed to see the elephant seal waddling, gobbling antics on a California beach. (This is one of the entertaining recommendations from my colleague Amanda Hess.)
We want to hear from you. Let us know what you think about this newsletter and what you’d like us to explore. You can contact us at [email protected]
If you have not received this newsletter in your inbox, Please register here. You can also read columns On previous technology.