Apple shuns call for succession plan

As Steve Jobs remains on sick leave, activists are demanding to know what will happen if he doesn't return

Apple's board needs to reassure shareholders that it has a plan in place should Steve Jobs not be able to return to his duties as chief executive of the technology giant, dissident investors will argue at the company's annual meeting today.

The health of Apple's visionary chief executive – who is on an indefinite medical leave – is sure to be centre stage when shareholders gather in California, where the board is trying to squash a proposal that would force it to publish a formal succession plan. Activists from an Illinois pension fund are demanding new details on how the company has been planning to deal with a leadership change, should one become necessary, and they say they expect wide support.

"The last thing we want is for Steve Jobs to step down. His is the classic American success story, coming from nothing to run the second-largest company in the country. We would like him to be there forever, but that is not realistic," said Jennifer O'Dell, corporate governance chief for the Central Laborer's Pension Fund, who will argue for the dissident resolution today.

"We have seen lots of examples of imperial CEOs, and ultimately they have come to harm their companies and their shareholders. We are long-term shareholders, and we want to know that the company is thinking about the future."

The pension fund, which represents 500,000 workers from 12 unions, mainly in the construction industries, says Apple should adopt and publish a succession planning policy, including a promise to review an "emergency succession plan" that is reviewed annually. Ms O'Dell says she is not calling for any particular successor to be publicly named.

Apple has reacted angrily to the idea, and is urging shareholders to throw out the plan, which it calls an attempt to "micro-manage and constrain the actions of the board". It says it has a comprehensive succession plan for all the posts in the company, including the chief executive post.

Similar resolutions have been proposed at dozens of companies, in the hope of persuading companies to promote internal talent rather than spending large amounts of shareholder money to woo outsiders to the chief executive post. At Apple, the resolution has taken on much more significance, because few other companies are so closely identified in the public mind with their chief executive – and because of Mr Jobs's battles with ill-health.

On 17 January it was announced that the Apple boss was going on indefinite medical leave and that day-to-day decision-making would devolve to Tim Cook, the chief operating officer.

It is the third time that Mr Cook has had to step in for his boss. A Silicon Valley veteran, who worked at IBM and Compaq before joining Apple in 1998, Mr Cook is now well known to Wall Street analysts, and well respected for his command of the minutiae of Apple's manufacturing business and his ability to squeeze efficiencies in the production of its products. What he is not known for is the showmanship and visionary zeal that Mr Jobs has brought to Apple as it has revolutionised first the digital music market and then the mobile phone market, and now perhaps the personal computer industry with the launch of the iPad.

Mr Cook's previous stints in charge ran for two months in 2004, while Mr Jobs recuperated from pancreatic cancer surgery, and then for six months in 2009, when the chief executive underwent a liver transplant.

There has been no update on Mr Jobs' health since January, when he wrote an email to staff saying "I love Apple so much and hope to be back as soon as I can," and asked for privacy. Speculation continues to cause gyrations in the stock, as it did last week when a US tabloid printed pictures of him leaving a California cancer clinic. Those shots, and pictures of Mr Jobs seated next to President Barack Obama during a dinner with technology industry bosses last Thursday, were scrutinised for any clues as to the nature of his illness and his prognosis.

The uncertainty led Institutional Investor Services, which advises investors on corporate governance issues, to back the Illinois pension fund's proposal for a public succession policy. "Such disclosure could help to reassure investors that the board has confidence in the management team supporting the CEO, and will be prepared to promptly name a successor whenever that becomes necessary. This could help mitigate some of the volatility in the share price which has accompanied news and rumours about the health of Mr Jobs," ISS told its clients.

But it added that it was not necessarily critical of Apple's board members. The board, it said, "appears to be quite deferential to Mr Jobs's desire for privacy regarding his health, that does not necessarily mean the board has been derelict in its duty to plan for a CEO transition."

Start your day with The Independent, sign up for daily news emails
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consultant

£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....

Recruitment Genius: Compliance Manager

£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...

SThree: Talent Acquisition Consultant

£22500 - £27000 per annum + OTE £45K: SThree: Since our inception in 1986, STh...

Recruitment Genius: Experienced Financial Advisers and Paraplanners

Negotiable: Recruitment Genius: This extremely successful and well-established...

Day In a Page

Seifeddine Rezgui: What motivated a shy student to kill 38 holidaymakers in Tunisia?

Making of a killer

What motivated a shy student to kill 38 holidaymakers in Tunisia?
UK Heatwave: Temperatures on the tube are going to exceed the legal limit for transporting cattle

Just when you thought your commute couldn't get any worse...

Heatwave will see temperatures on the Tube exceed legal limit for transporting cattle
Exclusive - The Real Stories of Migrant Britain: Swapping Bucharest for London

The Real Stories of Migrant Britain

Meet the man who swapped Romania for the UK in a bid to provide for his family, only to discover that the home he left behind wasn't quite what it seemed
Cheaper energy on the way, but it's not all sunshine and rainbows

Cheaper energy on the way, but it's not all sunshine and rainbows

Solar power will help bring down electricity prices over the next five years, according to a new report. But it’s cheap imports of ‘dirty power’ that will lower them the most
Katy Perry prevented from buying California convent for $14.5m after nuns sell to local businesswoman instead

No grace of God for Katy Perry as sisters act to stop her buying convent

Archdiocese sues nuns who turned down star’s $14.5m because they don’t approve of her
Ajmer: The ancient Indian metropolis chosen to be a 'smart city' where residents would just be happy to have power and running water

Residents just want water and power in a city chosen to be a ‘smart’ metropolis

The Indian Government has launched an ambitious plan to transform 100 of its crumbling cities
Michael Fassbender in 'Macbeth': The Scottish play on film, from Welles to Cheggers

Something wicked?

Films of Macbeth don’t always end well - just ask Orson Welles... and Keith Chegwin
10 best sun creams for body

10 best sun creams for body

Make sure you’re protected from head to toe in the heatwave
Wimbledon 2015: Nick Bollettieri - Milos Raonic has ability to get to the top but he must learn to handle pressure in big games

Nick Bollettieri's Wimbledon files

Milos Raonic has ability to get to the top but he must learn to handle pressure in big games
Women's World Cup 2015: How England's semi-final success could do wonders for both sexes

There is more than a shiny trophy to be won by England’s World Cup women

The success of the decidedly non-famous females wearing the Three Lions could do wonders for a ‘man’s game’ riddled with cynicism and greed
How to stop an asteroid hitting Earth: Would people co-operate to face down a global peril?

How to stop an asteroid hitting Earth

Would people cooperate to face a global peril?
Just one day to find €1.6bn: Greece edges nearer euro exit

One day to find €1.6bn

Greece is edging inexorably towards an exit from the euro
New 'Iron Man' augmented reality technology could help surgeons and firefighters, say scientists

'Iron Man' augmented reality technology could become reality

Holographic projections would provide extra information on objects in a person's visual field in real time
Sugary drinks 'are killing 184,000 adults around the world every year'

Sugary drinks are killing 184,000 adults around the world every year

The drinks that should be eliminated from people's diets
Pride of Place: Historians map out untold LGBT histories of locations throughout UK

Historians map out untold LGBT histories

Public are being asked to help improve the map