Apple Shareholders Reject CEO Succession Rule
By:NewsyStocks   Wednesday, February 23, 2011 5:00 PM

Apple Inc. (Nasdaq: AAPL) shareholders voted down a proposal during the company's annual shareholder meeting, under which the company is required to outline the succession plan, according to AP.

The company's investors have expressed concern since its Chief Executive Steve Jobs, who received a liver transplant in 2009, went on medical leave suddenly last month.

The succession-planning measure, brought by Laborers' International Union, would have required Apple to produce an annual report on succession planning and develop criteria for selecting candidates to the top position.

Apple argued that the Fund's proposal, if implemented, would publicize Apple's confidential objectives and plans, as it believes that publicly stating potential CEO candidates will hurt its ability to attract and retain top talent.

James Post, a professor at Boston University's School of Management told The Street, "It was no surprise that shareholders voted down the proposal calling for an open discussion of succession plans," he explained, in an email. "The board has consistently refused to publicly discuss succession issues in wake of Steve Jobs' health problems."

According to a survey by an analyst on consumer sentiment for Apple products, 93 percent of respondents said they would continue to buy Apple products even if Steve Jobs leaves the company. "Survey data shows only minor consumer impact from CEO Steve Jobs departing Apple," wrote RBC Capital Markets analyst Mike Abramsky in the report.

In Jobs' absence, Apple's Chief Operating Officer Tim Cook has been handling the company's day-to-day running, and is widely regarded as Steve Jobs' likely successor. He has handled the company on two prior occasions; for two months in 2004 when Jobs was receiving treatment for pancreatic cancer, and again for six months in 2009 when jobs went for a medical leave to get his liver transplant.

Apple has recently reported impressive first quarter results and is expected to continue with its momentum with the launch of the second version of its most popular iPad device, expected to debut at a March 2, 2011 event in San Francisco. Apple closed gaining 4.01 points, or 1.18 percent to settle at $342.62 on Wednesday.