Apple’s co-lead directors, Arthur Levinson and Bill Campbell, each answered questions at the company’s annual meeting on how the board has handled disclosures about Jobs’s health, succession planning and executive pay at Apple. In past years, Jobs has dominated the meeting, with board members sitting quietly in the first row of the audience.“The dynamism of him controlling the meeting has changed,” Scott Adams, a representative of the American Federation of State, County and Municipal Employees, said in an interview after the meeting. His organization owns 18,218 Apple shares. In the past, “Jobs would not allow questions to go to directors.”
Standing up to address a packed room, Levinson, the CEO of Genentech Inc., said yesterday that “nothing has changed,” since Apple’s disclosure on Jan. 14 that Jobs was taking a five- month medical leave.
“He certainly remains the CEO -- he’s responsible and deeply involved in all strategic matters,” said Levinson, who’s served on Apple’s board since 2000. “If there’s new information that we deem important to disclose, that will happen. At this point we feel we’ve met all disclosure obligations and responsibilities.”
Apple’s Disclosures
Corporate governance experts have faulted Apple’s board, which includes former U.S. Vice President Al Gore and Google Inc. CEO Eric Schmidt, for not talking about Jobs’s health sooner and in more detail after concern about his weight loss last year caused movements in the stock price. Jobs, a cancer survivor, missed the annual meeting for the first time in more than a decade.
While giving shareholders updates isn’t a hard and fast rule, Apple’s board will probably be compelled to talk more about Jobs’s health if anything changes significantly, said Jahan Raissi, a partner at Shartsis Friese LLP in San Francisco. He was a former senior counsel in the enforcement division of the Securities and Exchange Commission.
“If in two months it comes out that something changed and people knew two months ago and they didn’t say anything, there could be hell to pay,” Raissi said in an interview. “If they don’t say anything more, then it’s reasonable to believe that the company doesn’t know any different information.”
Apple fell $1.97, or 2.2 percent, to $89.19 at 4 p.m. New York time in Nasdaq Stock Market trading. The shares have gained 4.5 percent this year.
Biggest Assembly
Yesterday’s gathering -- held in the same auditorium at Apple’s Cupertino, California, headquarters where Jobs typically introduces new products -- was the biggest public assembly of directors at an annual meeting in the past three years.
Levinson and Intuit Inc. Chairman Campbell, seated in the front row, were flanked by four other independent directors: Gore, J. Crew Inc. CEO Millard “Mickey” Drexler, Avon Inc. CEO Andrea Jung and former International Business Machines Corp. finance chief Jerome York. The only board members absent were Jobs and Schmidt.
Last year, Jobs was joined by Gore, Schmidt, Levinson and Campbell. In 2007, Levinson, Campbell and Schmidt also attended.
On Jan. 5, Jobs said treatment for his weight loss was “relatively simple.” Nine days later, he announced he would take leave after learning his health issues were “more complex” than he originally thought.
SEC Probe
The SEC started an investigation into the disclosures to determine whether investors were misled, a person familiar with the matter said last month. The review doesn’t mean investigators have seen evidence of wrongdoing. Apple general Counsel Daniel Cooperman declined to comment on the SEC investigation yesterday.
Jobs, who co-founded Apple in 1976 and was ousted in a management coup in 1985, returned to lead the company in 1997. One of the first things he did was to replace all but two of the board members. His picks included Campbell, a former Apple executive, and York, an adviser to Tracinda Corp. CEO Kirk Kerkorian.
“It’s a very secretive culture, a very closed culture,” said Conrad Mackerron, director of corporate social responsibility for As You Sow, an environmental advocacy group in San Francisco. The group, which met with Jobs two years ago to talk about Apple’s environmental policies, submitted a shareholder proposal asking that the company provide more details on its effort to cut carbon emissions. “It’s hard to talk in an open manner.”
No Mobile Phones
Only shareholders were allowed into the meeting hall and able to ask questions. Reporters, and latecomers, watched the 75-minute event on video in a separate room. Apple banned the use of mobile phones, personal computers, cameras and recording devices. Apple typically doesn’t make a transcript of the event available.
Campbell, 68, used his time at the microphone to talk about the board’s decision to vote against a “say-on-pay” proposal. Campbell said the board wanted to retain the flexibility to reward executives as “we see fit.”
“You can sense there’s more disclosure,” in that board members were forced to answer questions, said Gene Munster, an analyst with Piper Jaffray & Co. in Minneapolis, who has recommended investors buy Apple’s shares since June 2004. “It’s a good thing that Apple is more transparent.”
Investors still want more information, said Andy Hargreaves, an analyst at Pacific Crest Securities in Portland, Oregon.
“If I was a shareholder, I would have been upset if I heard them say, ‘He was fine, it’s a hormone imbalance’ and then nine days later, hear him say ‘I’m taking leave,’” said Hargreaves, who rates Apple shares “outperform.” “That’s misleading at best. It’s possible that things change that quickly. That’s why the lack of disclosure is disconcerting.”
--------------------------------------------------------
If you like this post please Bookmark it and comment bellow. To recieve new updates and other posts like this please subscribe via RSS or via Email.
Recent Articles:
Posts
0 comments:
Post a Comment