Apple has enjoyed unprecedented financial success ever since Tim Cook took over as CEO back in 2011, and with the comparatively small $65.2 million in compensation that Cook received last year, he’s practically a bargain! At least, that’s what Bloomberg is saying. According to the Bloomberg Pay Index, Tim Cook has the best pay-for-performance rating out there, which is calculated by measuring an executive’s pat as a performance of the company’s profit.
Apple Inc.’s Tim Cook has the best pay-for-performance rating of any chief executive officer on the Bloomberg Pay Index, the first daily ranking of the highest-paid U.S. executives. Cook was awarded $65.2 million in compensation last year. During the three fiscal years he has run Apple, revenue climbed 69 percent to $183 billion and net income grew 53 percent to $39.5 billion. Sales of iPhones more than doubled to $102 billion. “Apple is just unbelievably killing it,” said Dan Ernst, an analyst at Hudson Square Research in New York. “A good leader like Cook builds a team around him that can do the job.” The 54-year-old’s awarded pay package, which makes him the 17th-highest paid U.S. executive, is dwarfed by Apple’s three-year average economic profit of $28.6 billion, the index shows. The pay-for-performance measure used in the Bloomberg ranking is calculated using an executive’s pay as a percentage of a company’s economic profit, which is defined as after-tax net operating profit minus its cost of capital. Cook’s pay is 0.2 percent of economic profit, the smallest fraction of any CEO in the ranking, showing that investors are getting a better return on each dollar they pay Cook.