A Well-known Company All Around The World: Apple Compensation Practice (Essay Sample)

Apple Compensation practice Name Institutional affiliation For this task, I choose apple Inc. considering it operates in many countries and it is also a well-known company all around the world. The other reason why I picked this company is that it has surfaced on the limelight in the past for various reasons that do not strengthen its image as a global technology giant. Apple compensation strategy The apple compensation committee is composed of at least three who are acting under the rules and regulation stated by NASDAQ which prohibits the members of the committee to take part in another company. The committee is obligated with the establishment and modification of compensation and incentive schemes as well as revising and approving of awards under the compensation and incentives schemes as well as administering the committee for equity compensation. On this note, it’s important to understand that a majority of the staff at Apple are retailers thereby limiting the company from putting the compensation strategies in the public domain. However, the words and reports by the employees paint an image of the compensation strategy. According to Segal (2012), the corporation pays its employees averagely $25,000 annually as compared to an estimate of $473,000 revenue that is generated by each of the retail employees; this is a deliberate underpayment by the firm. It has also been observed that the apple workforce in China put in more working hours in the draconian workstations, a phenomenon that is attributed to the fact that the Apple brand has gained global confidence thereby attracting more employees. The employees above the minimum wage such as the executives also enjoy other benefits, for instance, they are provided with the chance to buy the company’s stock as well as the apple products at a discounted prices (Segal, 2012). Apple Inc is one of the first companies to be admitted to Fair Labor Association, an organization that seeks to advocate for better working conditions for the company’s employees; however, this is not entirely true as the employees were pushed to work extra time which mostly amounted to over 98 hours a week. Best practices of Apple Inc The company's guiding principles include, the compliance with applicable regulations and laws, honesty in the company’s operations, respect of all stakeholders in the company from the employees, customers, suppliers, the principle of confidentiality has also been greatly advocated for strongly. The company is also is intolerant of retaliation. Moreover, the company insists that the employees should not abuse their position and lead to a conflict of interest within the company. The employee's responsibilities are limited to the company, and the employees are not allowed to use inventions for the benefits of others. The company also has strong policies on equality and discriminatory practices as well as the abuse of drugs and other substances that might interfere with one's judgment. Incidences of money laundering can be directly reported to the administrator or the legal division of Apple. Out of the business environment practices include not giving or accepting handouts from outsiders in return for a favour, all dealings with the government shall also be done together with the legal department; the company has a zero corruption policy and have even formulated anti-corruption policies in the firm most importantly the company has taken all measures to ensure that the employees operate in a healthy and safe environment. The company insists that the employees conduct themselves in a manner that is of benefit to the public thus would include selecting a non-profit charity and participating in the various charity functions organized by the non-profits. Similarly, the consumers' interest has been given priority during the designing phase of new products. In the business administration, the firm's policy articulates that the board must be composed of the majority of the self-regulating managers who either meets or surpasses the standards that are set by NASDAQ. A director who serves as the CEO of the corporation must only serve the company as a significant amount of time and attention is required in overseeing the various operations of the company on a day to day basis. The daily operations and the performance of the director is overseen by the compensation committee while the board of directors appraises the performance of all the senior officers Challenges The compensation practice is faced with a plethora of challenges that the company faces. As had been postulated earlier, the interests of the consumers come first, however, to achieve the consumer satisfaction that the company advocates for the employees have to put in more extra hours and earning salaries that are not commensurate to the efforts as well as the revenues they bring in thereby leading to a significant employee turnover. The chief executive officer of the company parts with a considerable amount of cash in the corporation, at the same time the employees of the firm parts with meager income (Denning, 2012). This caused many employees to quit working for the corporation, however, at the same time, some employees stayed as they considered the company cool. Nonetheless, the price of substituting and inducting the rookies complements the low pay. Another challenge facing the technology giant is its tainted reputation. The company has been receiving negative publicity since the news concerning the exploitation of the employees surfaced; this has put the company under the microscope of various labor associations that advocate for better working conditions and remuneration for the employees. To the disappointment of the company all these claims were true and various lawsuits followed about the poor remunerations and working environment within the cooperation (Liedtke, 2013). One lawsuit accusing the company of exploiting the personnel and short changing them Impact to the company and its stakeholders The corporation's reward practice has both constructive and undesirable impact on the corporation and the shareholders. The company remunerates the Mac developer, software coders, and other top officials substantial amounts that have resulted in a higher retention rate considering their importance in the company's innovation which has produced better products making the company more competitive as compared to other tech giants such as Microsoft and Google. The company also has targeted individuals at their earlier twenties and mid-twenties and has let go of the older individuals since these individuals have little family responsibility making them be able to accept the low remuneration since they are associated with the tech firm additionally, the young people believe that having the name apple inc in their resume will help them in career advancement thus this encourages most of the young people into the company, this makes the company profitable earning the shareholders their annual dividends timely being a listed company it traded in the stock exchange and recorded substantial earnings in the past fiscal year. On the other hand, the compensation plans have negative impacts. In 2012 it was reported that one of the employees of the firm who is based in China committed suicide after the company denied him leave (kan, 2012), the family of the deceased employee was not properly compensated even after subjecting the late employee to a 15 hours working schedule as a result of the high demand of iPhone 5 this made the firm be slapped with a number of lawsuits that targeted the compensation practice that is termed as unfair. The negative publicity that these revelations brought to ...