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2011-02-24 12:28:00
By Maggie Shiels Technology reporter, BBC News, Silicon Valley
Apple has beaten off efforts to reveal succession plans for the time when Steve
Jobs is no longer in charge of the company.
The proposal was made by the Central Laborers' Fund during the company's annual
shareholder meeting.
Steve Jobs, who is on his third medical leave of absence, did not attend the
event at Apple's headquarters in California.
Apple, a notoriously secretive company, fought the proposal from the outset.
A preliminary proxy count on the controversial measure suggested the fund
proposal had been defeated.
It was a move that disappointed Jennifer O'Dell, who made the proposal on
behalf of the fund, which represents 500,000 construction workers across the US
and Canada.
'Transparency'
"We want Steve Jobs to come back to work yesterday," Ms O'Dell told BBC News.
"We want him to be here every day. We want him to live forever.
"That is not realistic and that is why they need to have a plan. And if they
have a plan, and I am sure they do, what is wrong with a little transparency?"
Apple until now has said such a revelation would give competitors an "unfair
advantage" by publicising the company's confidential objectives and plans.
'Internal candidates'
The first time Mr Jobs took time off work to take care of his health was in
2004 when he revealed he had been diagnosed with pancreatic cancer.
A second medical leave of absence came in 2009 following a liver transplant.
At the time investors voiced some concern about the future of the company,
given how central Mr Jobs is seen to its success.
The Illinois-based pension fund said it filed its proposal last year, months
ahead of Mr Jobs' most recent decision to take time off work for medical
reasons.
The measure had asked for Apple to develop a plan that would be reviewed every
year that specifically laid out the "criteria for the CEO position" and "
identifies and develops internal candidates" to potentially fill the position.
The fund also called for Apple's board of directors to begin non-emergency
planning for a new chief executive three years before an expected transition.
'Real discussion'
Despite the defeat, Ms O'Dell said this was not the end of their efforts.
The fund holds nearly 11,500 Apple shares, worth around $4m ( 2.4m).
"If the company doesn't want to reach out to us and have a real discussion
about this issue we will refile it again next year," she said.
"Thirty companies have adopted this [succession plans] including HP and Intel.
"There are a lot of things we can do with this proposal.
"If the board continues to not want to listen to long-term shareholders, to
talk about this issue seriously, we can take a second step and hold the board
of directors directly accountable and we could withhold our votes from the
members of the board. Do we want to do that? No."
She said while Apple provided hundreds of thousands of labourers with security
for retirement the firm could not be run by just one person dictating the role
of the company.
'Right decisions'
In Mr Jobs' absence, the company is being run by chief operating officer, Tim
Cook.
During the hour-long meeting, no shareholders asked questions about Mr Jobs'
health, although a number wished him well for the future.
Outside the firm's headquarters, most of the opinion backed Apple's decision to
keep its cards about succession close to its chest.
"I feel making such a plan public is unnecessary," said Pam Pallakoff, a
shareholder for 20 years.
"We feel the management in place is very good management and they will make the
right decisions at the time they need to."
Fellow shareholder Shelton Ehrlich, 76, said he was glad the proposal lost, and
that he had faith that the company knew what it was doing.
"Mr Jobs, whether he is here or not here... the company will complete his
vision. At least for the next five years everything is set on a good path."
Analysts have long agreed with this view, that Apple has a long pipeline of
products and a deep management bench with a wealth of experience.
Similarly confident of Apple's future was 29-year-old shareholder Melissa
Gutknecht, who has held the company's stock since 2008.
"I am respectful of the way Apple is thinking of this issue and understand a
lot is being done behind the scenes," she said.
"My thought is they already have a plan in place and are not going to
jeopardize the shareholder by any means. I just think they are trying to be
smart about how they disseminate that information to shareholders and the
public."
Bigger say
One proposal that was approved was a requirement that unopposed candidate's for
the company's board receive a majority in order to be appointed.
The move has been seen as a victory for Calpers, the largest pension fund in
the US, which, the meeting was told, holds 1.6m Apple shares worth just under
$1bn.
Apple had opposed this measure and said it would hinder its ability to keep
members on its board.
Analysts said the vote underlined the fact investors want a bigger say in
choosing board members and more power in overruling the wishes of Apple
management, which is seen as a very close-knit group.
IPad announcement?
The shareholders meeting also ignited rumours of an updated iPad, with an event
in San Francisco next week dubbed Come See What 2011 Will Be The Year Of.
The company has sold more than 15m of the devices since its launch last April.
Mr Cook would not talk about future products, but did say he thought the market
for tablet computers was "huge, huge".
Unlike last year when the iPad had the market virtually to itself, this year it
will face increased competition from a number of companies from Google to HP to
Research in Motion.
Motorola's much publicised Xoom tablet, running an operating system developed
by Google, goes on sale on Thursday.
The Xoom was crowned the best gadget at the giant Consumer electronics Show in
Las Vegas last month.
Research in Motion plans to release four versions of its PlayBook tablet this
year, largely aimed at the enterprise market.