There is separation between management and ownership in Apple. The fundamental and ultimate goal of a firm is maximizing stockholder’s wealth. However, in real world, there are always conflicts of interest in stock price maximization objective between entities. Especially, managers might have more interests in generating out as higher net income as possible without considering long-term future value of firm. For this reason, stockholders hire the board of directors to oversee the management of the firm. By being given pressure, managers would more likely to try to achieve stock price maximization objective. This is why management and ownership should be separated to operate the firm efficiently. In terms of ownership of Apple Company, it has one executive, which is current CEO of Apple, Cook Tom, inside of eight board members. Cook might be still able to show some power in the Board of Directors for the ways of managing and operating the company, but it is expected that his management would be more toward based on opinions from the rest of Board members rather than his own interest. In addition, most of stock shares were owned outside of investors. Insider investors account for only less than 1% of Apple’s stock shares, which means Apple is more likely transparent for evaluation of its value.
Apple interacts with financial market with both investors and financial institutions to generate its capital for its economic profits. Since it is