Tim Cook on How Apple Champions the Environment, Education, and Health Care
We’re here to put a dent in the universe,” Steve Jobs once famously said. “Otherwise why else even be here?” If ever a company was self-consciously focused on making an impact—changing the world, in the argot of Fortune’s annual list—it’s Apple (AAPL).
And yet, for Jobs the dent that he intended for Apple to make in the universe revolved almost totally around creating new products that would change people’s lives. Those products would be gorgeous and useful and fun and surprising, but rarely “good” in and of themselves. Despite a hippie-dippie veneer and earnest marketing, Apple under Jobs was a ruthlessly efficient moneymaker that largely left social programs to others.
Apple CEO Tim Cook, 56, who joined the company in the middle of his career and has assumed the zealousness of a convert, is no less commercially minded than Jobs. And when asked to explain how Apple changes the world he answers immediately with two words one can imagine Jobs saying too: “our products.”
But Apple under Cook (for more on his growth as CEO, see this 2015 feature) is a company transformed in terms of how it projects onto the world its social awareness and its place in the corporate community. Fortune executive editor Adam Lashinsky, who first profiled Cook in a 2008 magazine cover story titled “The Genius Behind Steve,” sat down with the CEO in late March to discuss Apple’s view of itself as a force for good.
Some of what Cook said is surprising, including why he personally rejected the idea of establishing a corporate foundation. Or that some of Apple’s health care initiatives—which sprang from apps designed for the Apple Watch—have no discernible model for making money and may never.
Cook also paints a picture of Apple’s philanthropic and otherwise commercially beneficent activities as of a piece with the company’s ethos on product development: It tries to do relatively few things so as to better focus on them. Apple’s biggest priorities include renewable energy (it runs its own facilities overwhelmingly on them), education (it is focused on teaching coding from kindergarten through community college), and health care (including the $130 million it has raised for HIV/AIDS through its PRODUCT (RED) partnership with the Global Fund).
Ultimately, Cook sees Apple’s greatest societal contribution coming through the 2 million U.S. jobs it believes it creates through its “app economy” as well as the “many millions” more it supports in the rest of the world. For Apple, everything comes back to its products, about a billion of which are denting the universe at this very moment.
Fortune: Has Apple changed the world? [It is No. 3 on our Change the World list this year]
TIM COOK: Yes, I think in numerous ways. I think the No. 1 way Apple changes the world is through our products. We make products for people that are tools to enable them to do things that they couldn’t otherwise do—to enable them to create or learn or teach or play. Or do something really wonderful.
So that’s the primary way we change the world. We also try to change the world by the way we run the company. And whether that’s being very focused on the environment and making sure that we have a no-carbon footprint, essentially, or running our company on 100% renewable energy.
We advocate for human rights, because Apple has always been about making products for everyone. And, arguably, if people are treated as second-class citizens in any part of the world, then it’s kind of hard to accomplish that objective.
We believe education is a great equalizer. And so we try our best to bring education to the mainstream. And right now our major thrust is in coding because we think that coding is the sort of the second language for everyone in the world. And that’s regardless of whether they’re in technology or not. I think that you don’t have to be in technology for coding to be very important.
We try to advocate for people’s privacy because we are living in a world where technology can do lots of things, but there’s things that it shouldn’t do. And so we try very hard to protect people’s privacy and security and hopefully keep some of these bad things at bay for them.
So we try to do all of those things in the way that we conduct ourselves and run the company. But the primary way we will always change the world is through our products. Because we touch so many more people in that manner.
You say that Apple makes its products for everyone to be able to use. But Apple’s business strategy is to make premium-priced, high-margin, high-end products, which is why you’re the most valuable company in the world.
Well it’s not high margin. I wouldn’t use that word. There’s a lot of companies that have much higher margins. We price for the value of our products. And we try to make the very best products. And that means we don’t make commodity kind of products. And we don’t disparage people that do; it’s a fine business model. But it’s not the business that we’re in.
But if you look across our product lines, you can buy an iPad today for under $300. You can buy an iPhone, depending upon which one you select, for in that same kind of ballpark. And so these are not for the rich. We obviously wouldn’t have over a billion products that are in our active installed base if we were making them for the rich because that’s a sizable number no matter who’s looking at the numbers.
Talk about the economy that exists around Apple.
Think about Apple empowering people, particularly developers. The tool that we’re giving developers is not only a device but the developer kit that goes with the device so that they can in turn utilize their passion and creativity to build their product.
And then the App Store gives them the ability to sell to the world. It wasn’t imaginable that long ago that you could sit in your basement and run a global business. And so there’s entrepreneurs springing up in every country in the world and doing things they want to do.
We also manufacture. We don’t do it ourselves but we have third parties manufacturing for us. We have a ton of companies within the United States that do that; we have a ton of companies outside the United States that do that. But we create a lot of jobs in that way. Between the app economy and manufacturing, and then of course our own employment, we’ve created over 2 million jobs in the U.S.
What’s the corresponding figure for the world?
It’s many millions.
Recently Apple has become interested in health. Is this a potential moneymaker, or something more altruistic?
We started working on the Apple Watch several years ago. And we were focused on wellness. And wellness was about activity monitoring and also about performing some measurements of your health that people were not measuring, at least continually. Like your heart. Very few people wore heart monitors. So when we got into working on the watch we began to realize that the things that we could do were even more profound than that.
We’re extremely interested in this area. And, yes, it is a business opportunity. If you look at it, medical health activity is the largest or second-largest component of the economy, depending on which country in the world you’re dealing with. And it hasn’t been constructed in a way where the focus at the device level is making great products from a pure point of view. The focus has been on making products that can get reimbursed through the insurance companies, through Medicare, or through Medicaid. And so in some ways we bring a totally fresh view into this and say, ‘Forget all of that. What will help people?’
One of the things that we’ve learned that we’ve been really surprised and delighted about is this device, because of the monitoring of the heart, has essentially alerted people through the collection of the data that they have a problem. And that spurred them to go to the doctor and say, ‘Look at my heart rate data. Is something wrong?’ And a not-insignificant number have found out if they hadn’t come into the doctor they would have died.
We also discovered, somewhat by happenstance out of our curiosity, that the way that research was being conducted was sort of an old-world kind of thing. People were still putting classified ads in to try to get subjects to sign up. We put out ResearchKit [a software developers tool] and made it a source so that people could run enormous-sized studies. And there have been studies in Parkinson’s and so forth that literally are the largest studies ever in the history of the world. And we’re just scratching the surface right now. There’s no business model there. Honestly, we don’t make any money on that. But it was something that we thought would be good for society and so we did it. Will it eventually lead us somewhere? We’ll find out. I can’t answer that today.
There’s much more in the health area. There’s a lot of stuff that I can’t tell you about that we’re working on, some of which it’s clear there’s a commercial business there. And some of it it’s clear there’s not. And some of it it‘s not clear. I do think it’s a big area for Apple’s future.
Why does Apple not have a foundation the way so many companies do?
That’s a really good question. We looked at it in some detail.
I looked at it in early 2012. And I decided not to do it. And here’s why. When a company sets up a foundation, there is a risk, in my judgment, of the foundation becoming this other thing that is not connected to the company. It has a separate board of directors. They make reasonably independent decisions sometimes. It becomes a separate thing. I don’t want that for Apple. I want everybody involved. Because I think that the power that we bring, the things that we can do is because we’re stronger—it’s with our unity there. It’s when we put all of ourselves in it.
We don’t work on that many things. But we try to put all of ourselves in it.
With the environment we’re working from the design and development of our products, the kind of materials that we use. In manufacturing we’re looking at the renewable energy sources. When we put a data center in, we want to make sure that’s with renewable energy. On Earth Day we want all of our stores involved in making our customers aware of things they can do. We try to get all of us involved because it makes a much bigger difference. We can be the ripple in the pond then. If we had a foundation, my fear was it becomes something that 10 or 12 or 20 or 50 people do. And all of a sudden for the 120,000, it’s just this separate thing out there. People work here to change the world. So I think that should be integral to what the company does. Not peripheral in a foundation.
Did anyone disagree with your decision?
I got several recommendations, all of which were to set up a foundation. But I think my own judgment was when you really started asking the five whys, they all eventually landed on, because everybody else has done it. Or because some people felt that by having a foundation it was a signal that you cared. I see that as marketing almost, and we don’t ‘do good’ to market. That’s not what we’re about. And I realize there’s tax benefits with a foundation and all that kind of stuff. But look, again my perspective is, if you want to do good you maximize how to do good.
My view, we do a lot more good with a 120,000 people behind it than we would putting 12 people over in a corner to make decisions. I’m not criticizing people that do that. I think maybe they found a way and maybe it’s great. But it wouldn’t be Apple.
Let’s turn to education, which I know was a passion of Steve Jobs.
He was very interested in education as a market, but more than that. He was very keen on learning. And Steve was a lifelong learner, and he knew the value of it. And he felt that the traditional education approaches were not working.
And he thought one element of modern education was the digital classroom. And so at various stages, in early days, he was pushing Macs in classrooms. Actually pre-Mac he was pushing Apple computers in classrooms. And then iPad. Because he saw what iPad could unleash, he wanted to get all the textbook guys on the iPad because he saw kids walking with these 50 pounds of books, this little kid that weights 50 pounds trying to carry 50 pounds of books. And also that the book was flat. That there was nothing exciting. So he went out and spent $10 million on one textbook to show what was possible.
What we’ve tried to do is take that now to the next step. And our next step was we think everybody should learn coding. Not only because there’s a huge shortage of people that know how to code today, but because we see technology increasingly horizontal in nature and not vertical. A lot of people think of technology as kind of a vertical like all the others. I don’t really see that. I see that technology has become very horizontal.
But when we looked at it we found that there were multiple issues. One issue was that coding was viewed as being for computer scientists, that it was for a certain type of student, a very technical kind of student. And so we created a new programming language called Swift. And the whole concept of Swift is you make a coding language that has the ease of use of our products. And so everybody can learn it. Yet, it’s powerful enough to write the most complex apps that you’d ever want to dream up. And then we thought, well, what else can we do, and so we came out with Swift Playgrounds, a curriculum for say K4, K5, sort of in that age range. And that began to take off. And so then we took a step back and we made a bigger program for all of K–12 called “Everyone Can Code.”
And all this curriculum stuff is free. Anybody can have it that wants it around the world. We’ve done it in multiple languages. And then with things that we’ve learned over the last year, year and a half or so, we thought, We’re not hitting community colleges. And we need to hit community colleges. To our surprise we’ve already got 30 community college systems set up.
Apple has taken a hard line on privacy, relative to others in the tech industry. Is the industry moving more toward Apple’s position?
I don’t think there’s very many people that place it at the top of the list as we do. What I do see is that the broader user community, the importance of privacy is increasing. And the importance of security is exponentially increasing. And that’s because of all of the hacks, all of the reports of things that have gone on. You would be hard pressed to find very many people that haven’t had a problem I think, or heard of a problem from credit cards to whatever.
And so I think people appreciate it more and what I believe will occur, because companies that don’t follow customers don’t do very well, and so I think that will mean that more companies will put a higher priority on it.
And I hope that happens because our data is very private, our personal information is private stuff. And also, these devices can make your life so much better, but you want them to be secure.
How do you deal with the fact that many people view iPhones and iPads as tools of bad social behavior, like distractedness and children who stare for too long into a screen?
Our whole premise is to infuse our products with humanity. And so if you think about what the watch does, other than all the stuff we’ve already talked about from a wellness point of view, one of the things the watch does it allows you to have a curated level of connection without being absorbed in it. And so if you just want certain people to be able to message you or whatever, you’re waiting for that important message.
Or there’s some kind of notification that you really need, you can do that here and sort of be in the moment in a conversation. As opposed to waiting and continually picking this thing up to find out.
Also, with iOS 11 [the newest operating system for the iPhone and iPad], when you start traveling, you’re going to find out your phone is not going to accept notifications when you start moving in the car. And if you pick your phone up, you can say, “I’m not driving,” and it will give them to you. And if you want you can go in there and turn that off. But we’re trying to help people protect themselves and help people do the right thing.
I think that all companies should do that, to really think through how their products are used. Using a product is somewhat like eating healthy food. It’s really great. But you can eat too much of healthy food. And you can use something too much.
The watch also has—I see you’re not using one—but there’s a breathing app on here. And every so often it will tap you and prompt you to go through a one-minute breathing exercise. If you did this just for one week, it’s amazing how you’ll feel at the end of the week vs. not doing it.
You do it?
I do it. Sometimes it taps me at an inconvenient time and I can’t. But I can go in there and prompt it later. And it’s sort of a “Whooo …” So we really do try to think about all of this.
But surely the problem is bigger than a breathing app or a safety app.
It’s the set of many things. If you want to use this 24 hours a day [he motions to his iPhone], I’m probably not going to prevent you and probably shouldn’t. Because that’s the country we live in. You’re free to do that. But I ought to, as the provider of that, think through some things I could do that might be helpful for you. And we really try hard to do that.
Very last thing. There appears to be ample evidence that many parts of the public believe that corporations are bad, that they’re not a force for good in the world. You clearly believe one corporation in particular is a force for good. Is it a valid concern though on the part of the public and do corporations need to do better?
I think that corporations are like anything else in that there are some that are good and some that are not. So I don’t think you can paint all with one brush. Just like people. Most people are really big hearted. But occasionally you meet somebody that’s not. And so corporations are like that too, I think. I don’t subscribe to “all are good” or “all are bad.” I think life is not simple like that.
The ultimate objective of Fortune’s list, after all, is to celebrate companies that are making a positive impact on the world.
We will always try to change the world for the better. That was the motivation behind creating Apple when it was created back in the ’70s. And it’s still the motivation today. It’s what drives us. We want to do what’s right, not what’s easy. Because a lot of what we do is not easy. And we take some spears along the way. But we always try to do what’s right.
A version of this article appears in the Sept. 15, 2017 issue of Fortune with the headline “Apple Finds Its Core.”