ISS backs proposed Apple succession plan

An influential advisory service has thrown its weight behind a proposal by an Apple shareholder seeking a formal succession plan for the technology group following Steve Jobs’ latest medical leave.

The issue is a sensitive one for Apple, where co-founder Mr Jobs recently began open-ended leave for unspecified reasons.

Some investors and governance experts have faulted the company for failing to divulge Mr Jobs’ condition and for not spelling out what it would do if he does not return.

Institutional Shareholder Services endorsed the proposal by the Central Laborers’ Pension Fund, Jacksonville, Illinois, which is likely to have more votes when the proposal is put before investors at Apple’s annual meeting on February 23, the union pension fund said on Thursday.

The non-binding proposal by the fund would call on the board to make public reports each year on the state of its succession planning.

Apple said last month that it opposed the idea and that it already had a plan in place. Apple declined to comment on the latest development.

Jennifer O’Dell, assistant director of corporate affairs at the union, said the pension fund had made similar proposals at a number of companies last year and would do so again this year.

In the majority of cases, she said, the companies agreed to make disclosures and the union withdrew its formal proposals. That has happened at Hewlett-Packard and American Express, among others.

Elsewhere, discussions did not resolve the matter and it has gone forward to a vote. Apple is among the minority that have refused to hold talks, Ms O’Dell told the Financial Times.

In its annual proxy filing to shareholders last month, Apple complained that if it were forced to name chief executive candidates, those not named might resign, while those named could be poached by competitors. But the proposal does not ask for public naming of successor candidates. “We are not asking for the name of the successor, we are asking for the succession plan,” Ms O’Dell said.

She said that even with the ISS endorsement, the union proposal is unlikely to pass at Apple this year.

In Apple’s case, investors believe that the leading candidate to succeed Mr Jobs is Tim Cook, the chief operating officer, who is currently running the company. Mr Cook also ran Apple during Mr Jobs’ medical leave in 2004 and 2009.

Mr Jobs was diagnosed with pancreatic cancer in 2004, and a recurrence was the suspected reason he received a liver transplant five years later.

Copyright The Financial Times Limited 2017. All rights reserved. You may share using our article tools. Please don't cut articles from and redistribute by email or post to the web.