10 Mar 2015 Tim Cook has Another “Tim Cook Moment”; Denigrates Capitalism at Apple Shareholder Meeting
Comments Come After Free-Market Group Proposes Transparency Resolution Aimed at Determining Why Apple is Invested in Alternative Energy and the Risks to Shareholders and Taxpayers
Cook Attacks Profitmaking by For-Profit Companies for Second Year in a Row: Is Cook Ashamed of Profit?
Cupertino, CA / Washington, D.C. – At today’s annual meeting of Apple investors in Cupertino, California, where the National Center for Public Policy Research introduced a shareholder resolution asking the tech giant for more transparency about the risks associated with its alternative energy investments, Apple CEO Tim Cook seemed to have a message for shareholders who expect for-profit businesses to have profits: You aren’t Apple’s kind of people.
Cook twice made specific comments denigrating “return on investment,” or ROI, essentially doubling-down on a statement he made to the National Center last year, when Cook told the National Center and other shareholders interested in return on investment to get out of Apple stock.
“I was extremely surprised to hear Tim Cook denigrate the role of profit-making in business,” said National Center Free Enterprise Project Director Justin Danhof, Esq., who attended the meeting on behalf of the National Center and presented the National Center’s shareholder proposal. “Businesses make profits by offering goods and services that make people’s lives better. People buy them for that reason. There is no shame in earning profit. Mr. Cook seems to think there is.”
“Our proposal highlighted potential risks that Apple’s investors may face. Apple has invested hundreds of millions in alternative energy programs. These programs presently often enjoy significant taxpayer backing, but there is no guarantee that taxpayer subsidies will be permanent. We believe the board of directors should be forthright with shareholders about the extent of Apple’s exposure to risk, should the popularity of causes like global warming wane, and voters and politicians lose interest in subsidizing green energy.”
As prepared for delivery, Danhof introduced the National Center’s proposal stating:
[I]f Apple were to receive no more government handouts for its renewable energy projects, would CEO Tim Cook still put your money where his mouth is and spend hundreds of millions of dollars on alternative energy endeavors?
Rhetoric aside, it seems very unlikely that Apple would abandon its fiduciary duties to its shareholders and engage in such reckless activity. But we don’t know for sure because Apple’s board opposes our proposal. Some of you may recall that Mr. Cook stood on this stage last year and claimed that Apple doesn’t care about “bloody return on investment.” Then why is Apple a publicly traded, for-profit company?
A few facts are clear. Apple is heavily investing in renewable energy projects. Renewable energy projects are heavily subsidized by American taxpayers. These subsidies are not permanent and are anti-competitive. We have legitimate concerns that potential changes in government policies on alternative energy may harm Apple’s investors.
The National Center’s complete shareholder resolution, and Apple’s response to it, can be found on pages 62 and 63 of the company’s proxy statement, which is available for download here.
At last year’s Apple shareholder meeting, Cook famously responded to a question from the National Center’s Danhof about alternative energy by essentially stating that those investors who care about “bloody ROI” should divest their Apple stock. This event has even entered the business lexicon, and is known as a “Tim Cook Moment.”
Danhof introduced today’s proposal in the formal part of the shareholder meeting, which was conducted by Apple general counsel Bruce Sewell. Cook’s pointed remarks came, unprovoked, later while Cook was discussing new products and initiatives.
“When Cook introduced Apple’s ResearchKit, Tim Cook had another ‘Tim Cook Moment.’ He played to his progressive followers and said, for those of you looking for ROI, there isn’t one. To this, the liberal lemmings in the room cheered,” said Danhof. “Apparently not satisfied that this was a sufficiently strong and clear statement that he opposes businesses developing and producing products for the purpose of attracting buyers and thus profits, Cook followed up by stating that he wanted to be very clear, Apple didn’t do this for ROI. That just isn’t the lens Apple uses.”
“Last year we called into question Apple’s sincerity concerning alternative energy, and clearly Cook hasn’t gotten over that. But earnest questions remain unanswered,” said Danhof. “Are Apple’s alternative energy investments in Apple’s best financial interest? Cook seems to imply they are not, and if they are not, shareholders deserve to know the amount of risk they are undertaking. But many of these green investments benefit from taxpayer subsidies. Do these subsidies make a difference in making alternative energy attractive to big companies such as Apple? Both shareholders and taxpayers deserve to know the answer to that one. All we seek is transparency, which Mr. Cook opposes. Angrily opposes, apparently.”
“Is Apple investing in green energy because it believes green energy is more important than profit, or is it investing in renewable energy to ‘greenwash’ its image and appease progressive environmentalists? We don’t know the answer but we’d like to.”
“And regardless of whether Apple’s actions are a reflection of its sincere preference for green energy or are a clever way to promote a green image for itself, or even a combination of both, just how much money are American taxpayers providing to subsidize green energy for one of the richest companies in the world? If Apple was a country it would be the 55th wealthiest nation in the world.”
“We are surprised that Tim Cook allowed his anger to show today. It seems an unwise tactic that simply draws attention to the subsidies Apple is getting. But maybe Cook is so liberal, he thinks the public likes subsidizing large corporations.”
Earlier today, the National Center issued a press release highlighting its call for Apple to increase transparency. It can be found here.
The National Center’s Free Enterprise Project is the nation’s preeminent free-market corporate activist group. In 2014, Free Enterprise Project representatives participated in 52 shareholder meetings advancing free-market ideals in the areas of health care, energy, taxes, subsidies, regulations, religious freedom, food policies, media bias, gun rights, workers rights and many other important public policy issues.
Today’s Apple meeting marks the fourth shareholder meeting attended by National Center representatives in 2015.
The National Center for Public Policy Research, founded in 1982, is a non-partisan, free-market, independent conservative think-tank. Ninety-four percent of its support comes from individuals, less than four percent from foundations, and less than two percent from corporations. It receives over 350,000 individual contributions a year from over 96,000 active recent contributors.