Hmmm. This is the best argument I’ve ever heard for not using Apple products (besides the overinflated prices). Being flush with cash is probably why the CEO says he doesn’t care about the ROI (return on investment) and won’t make the costs transparent per a shareholder request. Seems like a sensible business request to me.
Some headlines/screencaps. FORTUNE magazine:
More: http://tech.fortune.cnn.com/2014/03/01/apple-cook-shareholders-sustainability/
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The Mac Observer:
More: http://www.macobserver.com/tmo/article/tim-cook-soundly-rejects-politics-of-the-ncppr-suggests-group-sell-apples-s
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Press release from NCPPR:
Tim Cook to Apple Investors: Drop Dead
Apple CEO Tim Cook tells Investors Who Care More About Return on Investment than Climate Change: Your Money is No Longer Welcome
As Board Member Al Gore Cheers the Tech Giant’s Dedication to Environmental Activism, Investors Left to Wonder Just How Much Shareholder Value is Being Destroyed in Efforts to Combat “Climate Change”
Free-Market Activist Presents Shareholder Resolution to Computer Giant Apple Calling for Consumer Transparency on Environmental Issues; Company Balks
Cupertino, CA / Washington, D.C. – At today’s annual meeting of Apple shareholders in Cupertino, California, Apple CEO Tim Cook informed investors that are primarily concerned with making reasonable economic returns that their money is no longer welcome.
The message came in response to the National Center for Public Policy Research’s shareholder resolution asking the tech giant to be transparent about its environmental activism and a question from the National Center about the company’s environmental initiatives.
“Mr. Cook made it very clear to me that if I, or any other investor, was more concerned with return on investment than reducing carbon dioxide emissions, my investment is no longer welcome at Apple,” said Justin Danhof, Esq., director of the National Center’s Free Enterprise Project.
Danhof also asked Apple CEO Tim Cook about the company’s green energy pursuits. Danhof asked whether the company’s environmental investments increased or decreased the company’s bottom line. After initially suggesting that the investments make economic sense, Cook said the company would pursue environmental goals even if there was no economic point at all to the venture. Danhof further asked if the company’s projects would continue to make sense if the federal government stopped heavily subsidizing alternative energy. Cook completely ignored the inquiry and became visibly agitated.
Danhof went on to ask if Cook was willing to amend Apple’s corporate documents to indicate that the company would not pursue environmental initiatives that have some sort of reasonable return on investment – similar to the concession the National Center recently received from General Electric. This question was greeted by boos and hisses from the Al gore contingency in the room.
“Here’s the bottom line: Apple is as obsessed with the theory of so-called climate change as its board member Al Gore is,” said Danhof. “The company’s CEO fervently wants investors who care more about return on investments than reducing CO2 emissions to no longer invest in Apple. Maybe they should take him up on that advice.”
“Although the National Center’s proposal did not receive the required votes to pass, millions of Apple shareholders now know that the company is involved with organizations that don’t appear to have the best interest of Apple’s investors in mind,” said Danhof. “Too often investors look at short-term returns and are unaware of corporate policy decisions that may affect long-term financial prospects. After today’s meeting, investors can be certain that Apple is wasting untold amounts of shareholder money to combat so-called climate change. The only remaining question is: how much?”
The National Center’s shareholder resolution noted that “[s]ome trade associations and business organizations have expanded beyond the promotion of traditional business goals and are lobbying business executives to pursue objectives with primarily social benefits. This may affect Company profitability and shareholder value. The Company’s involvement and acquiescence in these endeavors lacks transparency, and publicly-available information about the Company’s trade association memberships and related activities is minimal. An annual report to shareholders will help protect shareholder value.”
Apple’s full 2014 proxy statement is available here. The National Center’s proposal, “Report on Company Membership and Involvement with Certain Trade Associations and Business Organizations,” appears on page 60.
The National Center filed the resolution, in part, because of Apple’s membership in the Retail Industry Leaders Association (RILA), one of the country’s largest trade associations. In its 2013 “Retail Sustainability Report,” RILA states: “Companies will often develop individual or industry voluntary programs to reduce the need for government regulations. If a retail company minimizes its waste generation, energy and fuel usage, land-use footprint, and other environmental impacts, and strives to improve the labor conditions of the workers across its product supply chains, it will have a competitive advantage when regulations are developed.”
“This shows that rather than fighting increased government regulation, RILA is cooperating with Washington, D.C.’s stranglehold on American business in a misguided effort to stop so-called climate change,” said Danhof. “That is not an appropriate role for a trade association.”
For even more information on RILA, read “The Retail Industry Leaders Association (RILA): A Cartel that Threatens Innovation and Competitiveness,” by National Center Senior Fellow Dr. Bonner Cohen.
“Rather than opting for transparency, Apple opposed the National Center’s resolution,” noted Danhof. “Apple’s actions, from hiring of President Obama’s former head of the Environmental Protection Agency Lisa Jackson, to its investments in supposedly 100 percent renewable data centers, to Cook’s antics at today’s meeting, appear to be geared more towards combating so-called climate change rather than developing new and innovative phones and computers.”
After Danhof presented the proposal, a representative of CalPERS rose to object and stated that climate change should be one of corporate America’s primary concerns, and after she called carbon dioxide emissions a “mortal danger,” Apple board member and former vice president Al Gore turned around and loudly clapped and cheered.
“If Apple wants to follow Al Gore and his chimera of climate change, it does so at its own peril,” said Danhof. “Sustainability and the free market can work in concert, but not if Al Gore is directing corporate behavior.”
“Tim Cook, like every other American, is entitled to his own political views and to be an activist of any legal sort he likes on his own time,” said Amy Ridenour, chairman of the National Center for Public Policy Research. “And if Tim Cook, private citizen, does not care that over 95 percent of all climate models have over-forecast the extent of predicted global warming, and wishes to use those faulty models to lobby for government policies that raise prices, kill jobs and retard economic growth and extended lifespans in the Third World, he has a right to lobby as he likes. But as the CEO of a publicly-held corporation, Tim Cook has a responsibility to, consistent with the law, to make money for his investors. If he’d rather be CEO of the Sierra Club or Greenpeace, he should apply.”
“As in the past, Cook took but a handful of questions from the many shareholders present who were eager to ask a question at the one meeting a year in which shareholder questions are taken,” added Ridenour, “leaving many disappointed. Environmentalism may be a byword at Apple, but transparency surely is not.”
The National Center’s Free Enterprise Project is a leading free-market corporate activist group. In 2013, Free Enterprise Project representatives attended 33 shareholder meetings advancing free-market ideals in the areas of health care, energy, taxes, subsidies, regulations, religious freedom, media bias, gun rights and many more important public policy issues. Today’s Apple meeting was the National Center’s third attendance at a shareholder meeting so far in 2014.
The National Center for Public Policy Research is an Apple shareholder, as are National Center executives.
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.
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h/t to “cincinatuschili”
UPDATE: Yes, he must have.
@wattsupwiththat Wonder if he's forgotten about all those coal fired power stations running his Chinese factories?
— Karl Bentley (@bentleykarl) March 2, 2014
I think that ruthless tax avoidance is why Apple has so much cash – they do everything in their powers not to pay corporation tax and have hoarded cash just as Governments have had balance of payments crises. They aren’t alone in that, but if you add up corporate cash piles + government deficits since 2005 you’d see the quickest way to slash public sector deficits……..
Here is why small investors and institutions should get out of Apple stock.
The Apple CEO is willing to be misleading about the green policies of the company in public.
•Apple outsources the manufacturing emissions to Foxconn but the emissions are still there because of Apple.
•Apple builds in redundancy for its products to sell more.
•Apple uses rare earth metals unsustainably.
The Apple CEO does not let himself be bound by responsibility to shareholders and will not answer pertinent questions about the costs of the green policies of the company. Therefore the Apple CEO is willing to mislead the stock market about the impact of the policies of the company
If the Apple CEO is willing to mislead the stock market over small things, why not other things?
So there is no reason to believe any financial report from Apple.
QED: The Apple CEO is willing to follow Enron’s accountability procedures.
And that is why small investors and institutions should get out of Apple stock.
I understand all of Apple products are made in China.
All things considered,
The US upper crust hypocrisy runs deep.
Paul
our MSM is so CAGW-infested in Australia, the public hasn’t got a clue about what it’s all costing them, now and – even moreso – in the future, so they probably won’t even be angry about this!
3 Mar: Australian: AAP: Senators reject bill to scrap Climate Change Authority
Legislation to dismantle the Climate Change Authority was knocked back in the upper house today by Labor and the Australian Greens…
Greens leader Christine Milne said Australia could continue to receive high quality independent advice on global warming and a rigorous review of the renewable energy target.
“I am delighted that today the Senate has defeated Tony Abbott’s push to try and tear apart a science-based recommendation and go with his anti-science obsession,’’ she told reporters…
If West Australians at the upcoming Senate election reduce the number of coalition senators, the Senate would then have the numbers to reject government efforts to remove Labor’s climate change legislation, she said…
http://www.theaustralian.com.au/national-affairs/policy/senators-reject-bill-to-scrap-climate-change-authority/story-e6frg6xf-1226843760241
3 Mar: Sydney Morning Herald: Chris Taylor: Tim Cook to climate change deniers: get out of Apple stock
This post was originally published on Mashable.
(end of article: Mashable is the largest independent news source covering digital culture, social media and technology.
http://www.smh.com.au/digital-life/digital-life-news/tim-cook-to-climate-change-deniers-get-out-of-apple-stock-20140303-33uka.html
Perry says:
March 2, 2014 at 11:53 pm
I would hazard a guess that Cookie has had a “Ratner” moment. His outburst will be put down to the fact that he was “tired & emotional”. The AP photo is self explanatory. He clagged himself.
———————
Yeah, Ratner was the first thing I thought of when I read this hehe. Lets hope that it gets renamed to a a ‘Cooked Apple’
Stacey says:
March 2, 2014 at 3:45 pm
Companies like Apple and Microsoft bleat on about sustainability.
1 Upgrade from an I phone 4 to 5 and you have to have new cables for your computer at work and in car charger. Also if you have a docking station you’ll need a new adapter.
2 Microsoft stopping support for Windows XP means that many businesses will have to dispose of perfectly good machines?
=========
yup.I have “saved’ 7 perfectly good pcs from the tip in the last month, in a very small town. due to the idiot win8 requirements.
so?
I plan to load em with Linux and give them away to anyone who needs a computer.
and am swapping all mu units to linux
and now WILL sell the applelaptop and 2 benchtops.
An Apple which is rotten to its Gore?
u know a firm is doomed when it gets hijacked by dogma not innovation. looks like people using it as a platform for soapboxing their munch scream?
The way I see the various tech offerings is like this: Microsoft, a bit vague and fumbling at times. Google, useful but malevolent. Apple, pure evil.
The basis of the Apple analysis is the hype, the prices, the horrible ‘experience’ of using one of their locked down, limited and illogical products. But most of all because they are the biggest tax avoiders on the planet – and not just in the US. Yes, I know tax avoidance is not illegal per se, but it is in my book utterly immoral. I will not invest in, nor support through purchasing, such a disgusting corporation.
All this article does is reinforce my opinion.
So how much middle eastern oil money is tied up in Apple then
Nedders speaks with common sense ….
——————
Nedders says:
March 2, 2014 at 11:50 pm
With due respect, what Cook actually said was “If you want me to do things only for ROI reasons, you should get out of this stock.”
Nothing here that would not appear to be within the remit of any CEO comfortable in the support of an empowering Board?
Does this mean that Apple will no longer be using materials that are by-products of the petro-chemical and mining industries?
Enquiring minds want to know…
People are detecting cult-like behavior at Apple? Stop the presses! Problem is their master, St. Steve, has joined the eternal cloud, leaving behind a man bereft of charisma and shockingly naive, ignorant and hypocritical regarding climate matters.
Apple Cult Gets Personal? Investors must be worried that the Apple board has been taken over by climate hysterics. What should they do?
Why Investors Should Short Apple and Buy Samsung
“Can’t innovate any more, my ass!”
Apple’s head of marketing, Phil Schiller, came across a little defensive in his speech at last year’s Macworld conference. I can see why he might feel that way. For the last decade, Apple set the pace when it comes to consumer electronic gizmos… but now, its competitors are closing in.
In fact, Apple’s glory days could be over…
Don’t get me wrong – Apple is a great business. But I have severe misgivings about its longevity, and the way it treats its customers. Last week, I seriously looked at shorting Apple’s stock… but in the end, I thought better of it. After all, Apple’s products are still selling like hotcakes, and it’s making great strides into the emerging markets.
Apple released a trading update… and boy did I wish I’d put my money down on a short position! It reported record profits, but the stock took an 8% whack.
Apple’s problem isn’t sales. It’s got plenty of those. The problem is growth – or lack thereof. And if Apple is no longer considered a growth stock, then there needs to be a fundamental revaluation of the shares.
Apple is no better than Ryanair
At first sight, Apple’s customer service may look nothing like Ryanair’s. After all, Apple’s loyal fan-base seems to love the products and I’m pretty sure that Apple doesn’t flagrantly abuse its customers like Ryanair. But there are some similarities.
First, customers are loyal because they’re forced to be. Apple operates what’s known as a “walled garden.” Apple controls its products’ operating software and also decides what applications and services you’re allowed to use.
Like Ryanair, once you’re on its plane, you’re limited to what it wants to offer you. £3 for a bottle of water anyone?
But it’s not just customer services that Apple controls with its iron fist. It’s the actual hardware too. One of the big reasons I’m against Apple’s mobile gadgetry (which is the most important aspect of Apple’s business) is because of how limiting the stuff is.
Take the latest iPhone. It’ll cost you £50 more for a higher spec unit if you want to increase the memory from a measly 8Gb to 16Gb. Other customers can just add a memory card to their phone. I just upgraded my phone’s memory by 32Gb for less than £15.
Of course, this means Apple makes very decent margins. In fact, Apple’s gross margin comes in at just under 40% – that’s at least double what any other hardware maker might expect.
Apple is clearly profitable. But is this sustainable? I propose not. There are now cheaper and better alternatives.
The fall of a giant
Apple just can’t keep up. Their market share is falling – from about 18% last year, I see it falling to 15% by the end of this year. Though that may not sound like a lot, in reality it’s a massive drop.
As market share falls, the business will find it increasingly difficult to keep up with Google’s Android offering.
Fans of Google know how it’s using cloud technology to integrate the user experience. They are working on documents on their laptop, phone and tablet, seamlessly in the “cloud.” I know Apple offers something similar – but it’s not as joined up as Google.
Apple’s Research and Development budget has doubled in the last two years. But still market share dwindles. The fact is, Google doesn’t need to spend gazillions on trying to keep up. Much of the R&D function is effectively done by outsiders. They don’t need to control the whole process. Not only is this approach cheaper, but it produces better results.
As I survey the market for Android devices, I see products that could suit just about anyone’s requirements. Literally thousands of devices. With Apple on the other hand, you have to pick from a very limited range indeed.
Of course, Apple has been able to get away with all of this in the past. After all, it was the innovator. It seemed to know what the punter wanted before the punter knew it himself.
But now, it looks like the game could be up. Manufacturers across the world are innovating like mad. Apple can’t keep up, and a “walled garden” approach simply isn’t good enough.
Apple’s biggest hardware rival, Samsung, announced that it is to launch 60 new retail stores across Europe. It’s talking about a “powerful new retail concept” that will include an “exciting new customer experience with merges retail and technology innovations.”
I guess what it’s talking about is an experience not unlike Apple’s wonder stores?
Apple is going to get hit from all sides. Watch out as the great innovator gets out-innovated.
*****
Why Samsung will win the war with Apple
Apple has been all over the news. Sales are falling: can they come up with a new set of gadgets to stem the tide… perhaps an Apple watch, a TV set?
Who knows? What we do know is they’ve just caved in to investor demands and are set to use their massive cash pile to embark on the biggest share buyback ever witnessed.
What a pathetic move!
Meanwhile, arch-rival Samsung has just announced stellar results… cash is rapidly building up on its balance sheet too. The only thing is, they’ve got far greater vision about what to do with all these lovely excess funds.
This is a fascinating story. It just about sums up the difference between East and West. Apple is a brilliant company, no doubt. But when it comes to investment vision – the developing Eastern business community has a thing or two to teach the West.
Innovation is great, but imitation is better
The thing about Samsung is that it has a fantastic business plan – one that is just as impressive as Apple’s. If Apple’s philosophy is innovate and create; then Samsung’s is probably more like innovate and recreate.
The idea of imitation being somehow a second-best business plan is wrong. I remember when I got caught up in a conversation with a fancy lawyer specializing in start-up businesses. Only these businesses were set up explicitly to copy the business models of successful pioneering firms.
If some innovative company had just created the latest must-have gadget, then this lawyer would set out to see exactly how it could be imitated without infringing any patents. In fact, he also told me that quite often, the pioneering business hadn’t done their patent homework… often the imitator actually ended up with more legal protection than the original!
Like it or loathe it, the point is the imitator’s business model is less risky, and stands a pretty good chance of success. Samsung is proof of that. In fact, in the mobile phone market, they’re stealing market share from Apple – in many ways, they’re already more successful.
As Apple’s profits fell, Samsung announced a 50% rise in profits. This quarter they pulled in £4.1bn – that’s just this quarter!
The key thing is…
What are they doing with all this cash?
Something that hasn’t hit the radar of most investors is the somewhat smaller news titbit about Samsung…Samsung has entered the London real estate market. It was announced in January that Samsung is buying 30 Crown Place, the 19-storey tower next to Liverpool St station.
Readers with a long memory will note that back in September 2012 Samsung was investing in London-listed Cluff Gold. As part of the deal, Samsung is getting future gold production, straight from the mine. This is more than securing supply for its electronics. It’s an investment move.
And what does Apple do with its hoard? Sure, they’re investing in innovation… but then with the rest, they’re buying back their own shares.
Not only might that be a bad investment… if Apple’s profits continue to fall, then maybe the shares have a lot further to fall… but it also shows a lack of vision.
I like Samsung’s vision. It’s not dissimilar to the great US industrialists of yore. The Carnegies, Fords and Rockefellers built massive empires, including significant investment portfolios.
And just look at the sorts of investment Samsung is making. Gold and real estate. These are “real” or tangible investments. According to Bloomberg data, Samsung trades on nine times last year’s profits, but looking forward, it’s valued at a mere seven times this year’s prospective profits. If anyone should be buying back their own shares, it’s this lot! I don’t know why the stock is rated so low, maybe investors are a little nervous about South Korea’s agitating northern neighbor.
In any case, Samsung is a great company – and part of that greatness is in having faith in itself to build an empire – one that extends into the real, tangible world. I suspect that after a few years, Apple, and the general investing public at large, will wish they’d placed more emphasis on tangible asset investing and perhaps a little less faith in paper.
Good on you Samsung! And for any readers working at the City law firm Pinsent Mason or Crown Financial – in case you didn’t know, Samsung is your new landlord.
So, Apple has gone full Statist? Will they now produce the iRunAwayFromApple?
Stacey says: March 2, 2014 at 3:45 pm “Microsoft stopping support for Windows XP means that many businesses will have to dispose of perfectly good machines?”
Sixteen months ago I bought a new HDD for $80 and replaced the WinXP OS HDD with Fedora linux rather than endure Windoze’s death throes. M$ is leading the way for Scrapple to follow, FORWARD into oblivion.
The first – and definitely the last – Apple product I bought was an Apple 2.
Happy days….
Chris
I get the anger against Apple, but the either/or polarised mentality is surely what’s already so braindead about environmentalism, no?
Ie. Apple allies with thing I hate, therefore must hate Apple.
Like, can’t be an environmentalist AND be skeptical about AGW.
“Must hate anyone skeptical of AGW!”
Apple is one of the few IT companies that has made the customer experience so important that they are willing to ditch their own products in favour of better ones. Just compare the Windows phones that were out there for many years with giant screen wasting “Start” buttons like a desktop, and on which I spend half an hour trying to show smart people how to navigate their email using a stylus and drop down menus, to the iOS which I could show grandma who’s never used a computer, how to use in 5 minutes. That’s the sort of from top to bottom design feat which Apple is very good at. They make a lot of sacrifices to pursue that sort of thing, and with the iPhone, people voting with their wallets have shows that it is good. Ballmer’s “they have zero chance of success” was totally wrong. Blackberry who were king? They didn’t see it coming. Android? Underwent a late in the day UI overhaul.
Overpriced? Used to be very true in 1997.
Samsung? Well fine, hate Apple, so love Samsung, until they do something, I dunno, what was that other Korean company that was caught spying, uploading the filenames of all USB media plugged into its Smart TVs? Or the Sony rootkit? Or so many other “evil” things these companies do. Love Google? Oh wait, they’re sorta evil now. Love open Android? Oh wait, it isn’t so open anymore, and people are wondering if Samsung can afford to fork it, losing its access to Google’s proprietary ecosystem.
So um… it is California, they have their Green aura, and it is annoying that Apple is just perpetuating the myth.
AGW is politics with appeal to “reality” in the guise of pseudoscience. Apple have a marketing image to maintain, but for their part, they have done some very cool design stuff, mostly in HOW they combine technologies (it isn’t like they invented multitouch or 3G). Give them credit where it is due.
And dump their stock if it makes you feel better. I think I preferred it when Greenpeace was still picketing Apple’s exhibitions.
Stefan says:
March 3, 2014 at 3:36 am
” to the iOS which I could show grandma who’s never used a computer, how to use in 5 minutes. That’s the sort of from top to bottom design feat which Apple is very good at. They make a lot of sacrifices to pursue that sort of thing, and with the iPhone, people voting with their wallets have shows that it is good.”
It’s not called “sacrifices”; it’s called R&D budget. It’s a damn company, not a religious cult, even though it behaves like one.
JBirks says:
March 3, 2014 at 2:53 am
“People are detecting cult-like behavior at Apple? Stop the presses! Problem is their master, St. Steve, has joined the eternal cloud, leaving behind a man bereft of charisma and shockingly naive, ignorant and hypocritical regarding climate matters.”
The Ersatz CEO is just playing to the hipster base.
If Apple has hopped onto the CAGW bandwagon, then maybe it isn’t a bad idea to get out their stock. It indicates poor decision making at the top.
No real surprises here. Arrogance? Check. Unaccountability to the stockholders? Check. I’m smarter than you? Check. “We don’t have to show you no stinking badges” attitude? Check.
@DirkH
I mean “sacrifices” as for example, Jobs slashing their R&D projects and upsetting a lot of employees, in order to focus.
Stefan says:
March 3, 2014 at 4:42 am
“I mean “sacrifices” as for example, Jobs slashing their R&D projects and upsetting a lot of employees, in order to focus.”
Oh. “Sacrifices” reminded me of volcanoes and virgins. Looks like I misunderstood that.
@DirkH
I should use less emotive words. Too many words have multiple meanings! But the dictionary confirms it also has a non religious one.