Apple
Jobs, a cancer survivor, went on medical leave in January after saying he wanted to take himself out of the limelight and focus on his health. He had a liver transplant about two months ago, according to a person familiar with the matter.
While Apples directors dont need to give updates on Jobss health while he is on leave, that could change if he comes back as CEO, said Charles Elson, director of the John L. Weinberg Center for Corporate Governance at the University of Delaware.
“In the interests of transparency, I think it would be necessary for them to disclose something as serious as a liver transplant,” Elson said. “Investors want to know if hes healthy and if he can continue to run the company.”
Apples board sought legal advice on how the company should deal with disclosures about Jobss health, according to people familiar with the matter. While Apple and its board may not have been obligated to give more details on Jobss health, some corporate governance experts say both could have been more transparent.
Nutritional Ailment
Jobs, 54, said on Jan. 5 he would remain CEO at Cupertino, California-based Apple while seeking a “relatively simple and straightforward” treatment for a nutritional ailment. Nine days later, he announced his leave through the end of June and handed over day-to-day management to Chief Operating Officer Tim Cook.
“Steve continues to look forward to returning to Apple at the end of June and there is nothing further to say,” said Steve Dowling, an Apple spokesman. He declined to comment on disclosures about Jobss health. Jobs didnt return an e-mail seeking comment.
Jobs presided over every major Apple product launch since July 1997, until he went on leave this year. While the U.S. has strict medical privacy laws, Jobss CEO role and investors view that he is Apples chief product visionary may trump his right to privacy, said Nell Minow, co-founder of The Corporate Library, a research firm in Portland, Maine, that tracks corporate governance issues.
Medical Privacy
“The CEO of a public company cannot have the luxury of privacy about significant medical matters, especially when he is a central part of the companys brand and a core asset,” Minow said in an e-mail. “A board of directors has to insist on and provide frankness to the companys constituents — including its shareholders — about the CEOs health and its impact on his availability to the company.”
Jobs was considering a liver transplant as a result of complications following his 2004 surgery to remove an islet cell neuroendocrine tumor, Bloomberg News reported in January, citing people who were monitoring his illness.
Apple rose $3.60 to $139.48 on June 19 in Nasdaq Stock Market trading. Apples shares have risen 63 percent since Jobs went on medical leave.
Getting It Right
The board may “be getting it right because the company is in good shape, theyre not giving messages that hes peachy keen or coming back full time,” Dienhart said. “If people were worried about Apples team and they werent meeting expectations or the products werent as good as they were promoted to be, then Jobss health becomes more important from an investor point of view.”
Companies dont necessarily need to give details on the health of executives under U.S. law, said Michael Guttentag, associate professor at Loyola Law School in Los Angeles and former investment banker at Morgan Stanley.
“Theres nothing technically required of CEOs as far as disclosures about their health,” Guttentag said. “Silence is acceptable.”
Apples Board
Apples board has rarely commented on Jobss health. In January, the same day Jobs said he had found the cause of his weight loss in 2008, Apples directors issued a separate statement praising Jobss leadership.