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Should Atlas Shrug Off Apple?

The spirit of James Taggart possesses Apple CEO Tim Cook. See Vodkapundit's response: here.

by
Walter Hudson

Bio

March 5, 2014 - 7:08 am
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What would you do, as the owner of a company, if the manager you hired to run it rebuked your desire for the highest return on investment? Imagine that you approach your manager with concerns about his performance, and he tells you to stop worrying so much about profit.

Apple CEO Tim Cook did precisely that in a meeting with stockholders at the company’s Cupertino headquarters. Mashable reports on the confrontation with a group of stockholders objecting to Cook’s wasteful spending on environmental initiatives:

“We do a lot of things for reasons besides profit motive,” the CEO said:

We do things because they are right and just and that is who we are. That’s who we are as a company. I don’t…when I think about human rights, I don’t think about an ROI. When I think about making our products accessible for the people that can’t see or to help a kid with autism, I don’t think about a bloody ROI, and by the same token, I don’t think about helping our environment from an ROI point of view.

Anyone who had a problem with that approach? They should sell their Apple shares. “If you only want me to make things, make decisions that have a clear ROI, then you should get out of the stock,” Cook said to applause.

Emphasis should be placed on that applause. Stockholders went on to vote down a proposal to halt environmental efforts which hurt the company’s bottom line. In other words, stockholders voted against making money.

The episode evokes comparisons to Ayn Rand’s Atlas Shrugged and the character of James Taggart, heir to a railroad company who squanders his inherited wealth on altruistic efforts which ruin both his company and the national economy. Like Cook, Taggart believes business should be motivated by more than profit. Like Cook, Taggart believes business holds some responsibility to help people.

Comments are closed.

Top Rated Comments   
An Apple stockholder not, an Apple product purchaser, now also not.
20 weeks ago
20 weeks ago Link To Comment
If he is so unconcerned about profits, maybe he could move his production lines out of China's slave labor camps.
20 weeks ago
20 weeks ago Link To Comment
Cook is a fool, but in this case his advice is sound. I took it and sold my small holding of Apple shares. If he wants to pursue philanthropy, let him do it with his own money.
20 weeks ago
20 weeks ago Link To Comment
All Comments   (41)
All Comments   (41)
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I do not believe companies should generally be involved in charity work. I also do not believe they should do things they know to be immoral. If management thinks that using paper is immoral, I may think them wrong because I think trees are a renewable resource and then gauge their perhaps expensive avoidance of paper as a negative factor in evaluating their operations. If a company acts as though it believes that catastrophic global warming will occur due to man's use of fossil fuels, I see that as a reason to question their judgment. But I do not expect people to do what they think is wrong. If I disagree with them, I choose to associate with people have a more rational judgment.

Cook should be thinking about how his actions affect Apple's bottom line. Yet this does not necessarily mean that every project must yield a profit immediately or directly. A company may have an internship program which may allow them to identify a really good hire down the road, or it may just energize its own employees because they get enthusiastic explaining their work to a young person. Or, making a device for a small, unprofitable market may have great potential for proving an idea with a major impact on future operations and profit. The CEO should be thinking about profit, about risks, and about payoffs in time. Sometimes a charitable activity can also become a source of profit, but this almost always means the activity is closely connected to the company's mission and expertise.
19 weeks ago
19 weeks ago Link To Comment
I love Apple . i have numerous Apple products . I think they are the best . I am very concerned that they will not remain so with such an idiot running the company now . If he believes the Global warming hoax and wants to run people off if they disagree I do not think his judgement is good enough to run Apple .
19 weeks ago
19 weeks ago Link To Comment
There's a difference between a company 'doing good' by (in this case) making their product more user-friendly, especially for those with handicaps, and 'doing good' by diverting money to unrelated causes. The former is inherent in the company, and commendable. The latter is a wasteful boondoggle to make the elites in the company feel good.
19 weeks ago
19 weeks ago Link To Comment
Time to take a long-term short position on Apple stock!
19 weeks ago
19 weeks ago Link To Comment
Why would the CEO of Apple call for a divestment of his stock by making controversial statements?

Can't think of any reason except that Apple is buying back billions of dollars of its own stock, a move spearheaded by Cook.

Never let emotions guide investment decisions.
19 weeks ago
19 weeks ago Link To Comment
"Collectivism" on full display for all the World to witness the demise of a very dynamic, very innovative and extremely gifted Founder and visionary...Steve Jobs. A very tough act to follow, though it merits honorable mention, Steve Jobs, too, almost took Apple into the ground. Maybe Tim Cook will wake-up to capitalism's reality and shrug off his "let's lower the bar" philosophy.
19 weeks ago
19 weeks ago Link To Comment
Cook is running Apple the same way Obama is running the country...right into the ground.
19 weeks ago
19 weeks ago Link To Comment
Hmm, should I short Apple, or will Wall St eat up this crap?
19 weeks ago
19 weeks ago Link To Comment
This Apple CEO has an interesting marketing and business strategy.
19 weeks ago
19 weeks ago Link To Comment
Cook is clearly insane, be believes in Global Warming/Climate Change.
19 weeks ago
19 weeks ago Link To Comment
I am utterly no fan of "Global Warming," and all for good, solid and quantifiable scientific reasons.

Unfortunately, "Warmists" won't listen, preferring to place their hands over their ears, shout "LaLaLaLaLaLaLaLa," and walk around with a Unicorn's horn up their...

...well, you know.
19 weeks ago
19 weeks ago Link To Comment
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