The iReality of options

What a show.

Steve Jobs is in a class by himself when it comes to the technology product launch as consumer spectacle. Jobs practically invented the concept years ago, and proved this week that he remains peerless in his ability to knock the socks off a normally jaded crowd. Apple Inc.'s glitzy iPhone isn't for sale yet, and the company doesn't even own the rights to the name. But the new phone is an unqualified hit.

The iPhone launch went so well this week that it was easy to lose sight of the fact that Apple and Jobs have a big problem on their hands. Apple's acknowledged past practice of backdating employee stock options and the company's investigation into its own actions leave a lot of serious questions to be answered.

Of course, Apple isn't the only company with a stock-option investigation on its hands. Nearly 200 public companies have been caught up in the scandal. Dozens of executives have retired, been fired, or otherwise pushed out of their companies, and a few have been charged with crimes.

Not everyone is incensed by the options scandal. Some see it as an empty creation of corporate governance scolds. Those skeptics have seized the Apple situation and posed a question: What are you going to do, fire Steve Jobs?

That's a good question because we could come to learn that Jobs did or failed to do things, crossing thresholds that got other chief executives fired. And that would be a disaster.

Steve Jobs is the force of ambition, innovation, and vision at Apple, influencing a big company to a degree matched by few other chief executives. He has built Apple into a real leader and made his shareholders huge amounts of money in the process.

Since Jobs returned to the company as interim chief executive in 1997, Apple shares have earned more than 34 percent a year. The stock has appreciated by nearly $10 billion in just the two days since the iPhone was unveiled. Whatever Apple's future, it depends heavily on Jobs.

While Apple was preparing for its iPhone launch, the options-backdating story dripped out in stages, and Jobs seems to be more involved in each new version.

More than 6,000 options grants were improperly dated at Apple, and Jobs sometimes recommended specific dates. The record shows Jobs himself was awarded options at a board meeting that never really took place. But Jobs did not get much, if any, personal benefit from the options that were later swapped for stock.

A small committee of outside directors, including Al Gore, investigated. Its conclusion: Two former executives were to blame. Jobs didn't appreciate the accounting issue. He's all clear.

Apple was never going to throw Steve Jobs under the options bus. But how should stockholders think about Jobs and all the other executives in similar situations?

That depends on the answers to these three questions:

How bad were the specific offenses? What was the motivation? What has the executive contributed to his company and its shareholders?

Apple's misdated options were widespread, but I'm still not sure how culpable its chief executive is. Some executives who lost their jobs were options-abuse pigs, but Jobs clearly does not fall into that camp. Finally, Jobs has directly created many billions of dollars of value for Apple stockholders in the past decade.

Perhaps we will learn more damaging facts, but no one should want Apple's chief fired based on what we know today.

That doesn't mean Apple has performed well in its stock-options case. A company with a taste for blurring hype and reality when it sells electronics ought to play it straight with its corporate reputation.

So far, it feels like another show.

Steven Syre is a Globe columnist. He can be reached at syre@globe.com.