AXP American Express Company

Key 2019 Performance Results

How our Compensation Program Supports our Business Strategy

Our compensation program supports our business strategy through program design as well as aggressive financial and business growth goals. As a result, our compensation program is closely aligned with Company performance and is sensitive to the Company’s stock performance. Most senior executives’ compensation is variable and covers annual and multi-year performance periods. For example, our Long-Term Incentive Award is granted in two forms: performance restricted stock units (80% of award) and stock options (20% of award). Each of these incentives aligns executives’ interests with those of shareholders, including through the use of multi-year, performance-based vesting periods.

Our compensation program, including our executive compensation principles and strategy, is discussed in detail under the Compensation Discussion and Analysis section of this proxy statement.

Say on Pay, Shareholder Engagement and Feedback

We actively seek feedback from our shareholders and other stakeholders throughout the year. In 2019, we met with shareholders representing approximately 48% of our outstanding shares to discuss executive compensation, corporate governance and related matters. In order to establish a direct line of communication between shareholders and our Board, our Lead Independent Director, Mr. Ronald Williams, actively participated in certain of these meetings. The Compensation and Benefits Committee maintained the 2018 program structure when making 2019 pay decisions considering the strong 96.5% shareholder support for our say-on-pay resolution at our 2019 Annual Meeting.

Our shareholder engagement and response to shareholder feedback are discussed in detail under the Shareholder Engagement and Compensation Discussion and Analysis sections of this proxy statement.

Our Board of Directors

The following provides summary information about each director nominee. Our director nominees possess a range of diverse skills, backgrounds, experience and viewpoints that we believe are integral to an effective board. Detailed information about each individuals’ qualifications, experience, skills and expertise along with select professional and community contributions can be found starting on page 6.

Our Director Nominees

∎  Member     ●  Chair

Director Nominee Statistics

Diversity of Skills, Viewpoints and Expertise

Corporate Governance Highlights

For a detailed discussion of our corporate governance framework and our director nominees, please see “Corporate Governance at American Express” beginning on page 5.

		Charlene Barshefsky   Senior International Partner, WilmerHale   Director since 2001 Independent Age 69

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

		John J. Brennan   Chairman Emeritus and Senior Advisor, The Vanguard Group, Inc.   Director since 2017 Independent Age 65

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

		Peter Chernin   Founder and CEO, Chernin Entertainment, LLC   Director since 2006 Independent Age 68

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

		Ralph de la Vega   Former Vice Chairman, AT&T Inc.   Director since 2016 Independent Age 68

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

		Anne Lauvergeon   Chairman and CEO, A.L.P.   Director since 2013 Independent Age 60

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

		Michael O. Leavitt   Founder and Chairman, Leavitt Partners, LLC   Director since 2015 Independent Age 69

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

		Theodore J. Leonsis   Founder, Chairman and CEO, Monumental Sports & Entertainment, LLC   Director since 2010 Independent Age 64

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

		Karen L. Parkhill   Executive Vice President and Chief Financial Officer, Medtronic   Director since 2020 Independent Age 54

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

		Lynn A. Pike   Former President, Capital One Bank   Director since 2020 Independent Age 63

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

		Stephen J. Squeri   Chairman and CEO, American Express Company   Director since 2018 Chairman of the Board since 2018 Age 61

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

		Daniel L. Vasella   Honorary Chairman and Former Chairman and CEO, Novartis AG   Director since 2012 Independent Age 66

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

		Ronald A. Williams   Former Chairman and CEO, Aetna, Inc.   Director since 2007 Lead Independent Director since 2018 Age 70

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

		Christopher D. Young   Former CEO, McAfee, LLC   Director since 2018 Independent Age 48

Career Highlights

Specific qualifications, experience, skills and expertise:

Select Professional and Community Contributions

Our Board’s Composition

As illustrated by the director biographies on the previous pages, our Board is made up of a diverse group of leaders with substantial experience in their respective fields. We believe that our Board has assembled the right mix of members to provide effective oversight and insightful strategic guidance.

We continually review our Board’s composition to identify the skills needed for our Company both in the near term and into the future. Ongoing board succession planning, along with our mandatory retirement age for directors, assures that the Board continues to maintain an appropriate mix of objectivity, skills and experiences to provide fresh perspectives and effective oversight and guidance to management, while leveraging the institutional knowledge and historical perspective of our longer-tenured directors. To that end, in 2019, our Board engaged a third-party consultant to gain an outside perspective and help support Board succession processes and assessments as several Board retirements are expected to occur within the next few years due to our mandatory retirement age. Our Board believes that this workstream will help ensure an orderly Board succession process over the next few years.

Ideal Director Nominee Attributes

The Nominating, Governance and Public Responsibility Committee assesses potential candidates based on their history of achievement, the breadth of their business experiences, whether they bring specific skills or expertise in areas that the committee has identified as desired and whether they possess personal attributes and diverse experiences that will contribute to the sound functioning of the Board. While we do not have a specific policy on board diversity, our Corporate Governance Principles provide that the Board should be diverse, engaged and independent. When reviewing potential board nominees, the Nominating, Governance and Public Responsibility Committee considers the diversity of the Board, including gender and race, and does not discriminate on the basis of ethnicity, sexual orientation, culture or nationality. Specifically, we seek individuals who:

Process for Identifying and Adding New Directors

The Nominating, Governance and Public Responsibility Committee uses a professional search firm to help identify, evaluate and conduct due diligence on potential director candidates. Using a search firm allows the committee to make sure it is conducting a broad search and looking at a diverse pool of potential candidates. The committee also maintains an ongoing list of potential candidates and considers recommendations made by the Board’s independent directors.

In addition, the Nominating, Governance and Public Responsibility Committee considers all shareholder recommendations for director candidates and applies the same standards in considering candidates submitted by shareholders as it does in evaluating all other candidates. Shareholders can recommend candidates by writing to the committee in care of the Company’s Corporate Secretary, whose contact information is on page 27. Shareholders who wish to submit nominees for election at an annual or special meeting of shareholders should follow the procedure described on page 84.

The Nominating, Governance and Public Responsibility Committee identifies and adds new directors using the following process:

Our Board Evaluation Process

Our Board continually seeks to improve its performance. Throughout the year our Lead Independent Director has regular one-on-one discussions with our Board members and conveys their feedback on an ongoing basis to our Chairman. Separately, our Chairman, Chief Legal Officer and Corporate Secretary each routinely communicate with our Board members to obtain real-time feedback.

Our Nominating, Governance and Public Responsibility Committee oversees the formal annual evaluation process of the effectiveness of our Board and its standing committees. Conducting a robust annual evaluation process allows the Board to assess its performance and practices and identify areas for improvement. As part of the evaluation process, our Board analyzes and assesses the performance of both the Chairman and the Lead Independent Director, as well as the overall leadership structure of the Company.

In 2019, we leveraged the third-party consultant our Board had engaged to assist with strategic Board succession planning to augment our annual Board evaluation process. The individual interviews conducted with each Board member for this project were used to gain individual feedback from our Board which was shared with the full Board at an in-person meeting.

We believe that this continuous feedback cycle along with our formal annual evaluation process helps to ensure the continued effectiveness of our Board.

Our Board evaluations cover the following areas:

Our Board Leadership Structure

We believe that strong independent leadership is essential for our Board to effectively perform its primary oversight functions.

Our Board has been led by Mr. Squeri, our Chairman and CEO, and Mr. Williams, our Lead Independent Director, since 2018. Messrs. Squeri and Williams have forged a strong, collaborative, candid and productive working relationship. Their leadership is supplemented by engaged and expert committee chairs along with independent-minded, skilled and committed directors.

Our Board and Nominating, Governance and Public Responsibility Committee recently completed their annual review of the Board’s leadership structure. The review considered the insightful, effective and sound leadership provided by Mr. Williams during his tenure as Lead Independent Director as well as the tangible benefits of having a Chairman and CEO with an operational focus and extensive company experience given the global and complex nature of our business. Following thoughtful review and consideration, our Board continues to believe that our current leadership structure is the right structure for our Company. Our current structure allows the Board to focus on key strategic, policy and operational issues, provides critical and effective leadership (both internally and externally), and creates an environment in which the Board can work effectively and appropriately challenge management; all of which we believe will benefit the long-term interests of our shareholders.

Strong Lead Independent Director with Defined Role and Responsibilities

The Board recognizes that in circumstances like ours where the positions of Chairman and CEO are combined, a strong Lead Independent Director with a clearly defined role and set of responsibilities is paramount for constructive and effective leadership.

Therefore, the position of Lead Independent Director at American Express comes with a clear mandate and significant authority and responsibilities which are detailed in our Board-approved Corporate Governance Principles.

Our Corporate Governance Principles provide that the Lead Independent Director will:

Preside at all meetings of the Board at which the Chairman is not present, including the executive sessions of the independent directors, and apprise the Chairman of the issues considered and decisions reached at those sessions;

Call additional meetings of independent directors as needed;

Lead the Board in putting forth its expectations for “tone at the top”;

Meet regularly with the Chairman and serve as a liaison between the Chairman and the independent directors;

Facilitate effective and candid communication to optimize Board performance;

Advise the Chairman of the Board’s informational needs and review and approve the types of information sent to the Board and Board meeting agendas;

Review and approve the schedule of Board meetings to assure there is sufficient time for discussion of all agenda items;

Monitor and coordinate with the Chairman on appropriate governance issues and developments; and

Be available as appropriate for consultation and direct communication with major shareholders.

In addition, all Board members are encouraged to propose the inclusion of additional Board agenda items that they deem necessary or appropriate in carrying out their duties. All Board members have direct access to the Chairman and Lead Independent Director.

Our Board’s Primary Role and Responsibilities, Structure and Processes

Our Board bears the responsibility for the oversight of management on behalf of our shareholders in order to ensure long-term value creation. In that regard, the primary responsibilities of our Board include, but are not limited to (i) oversight of the Company’s annual business plan, (ii) corporate strategy and goals, (iii) ongoing succession planning and talent management and (iv) risk management.

How our Board Oversees our Annual Business Plan and Corporate Strategy

Our Board oversees our strategic direction and business activities. At the beginning of each year, our senior management presents our consolidated annual business plan to the Board, and the Board discusses the Company’s results relative to the plan periodically throughout the year. Each year, the Board engages in a two-day offsite strategy meeting with management where it conducts a comprehensive review and discussion of the Company’s strategic goals over the short-, medium- and long-term, as well as management’s plans to achieve such goals. In addition, at least once a year, each of the global business groups presents an in-depth review of their business to the Board, which includes a review of the strategic goals of the business and business performance relative to business strategy.

How our Board Engages in Ongoing CEO and Key Executive Succession Planning

Our Board ensures that we have the right management talent to pursue our strategies successfully.

The entire Board is involved in the critical aspects of the CEO succession planning process, including establishing selection criteria that reflect our business strategies, identifying and evaluating potential internal candidates and making key management succession decisions. Succession and development plans are regularly discussed with the CEO as well as without the CEO present in executive sessions of the Board. The Board makes sure that it has adequate opportunities to meet with and assess development plans for potential CEO and senior management successors to address identified gaps in skills and attributes. This occurs through various means, including informal meetings, Board dinners, presentations to the Board and committees, attendance at Board meetings and the comprehensive annual talent review. In addition, the Board has developed an emergency CEO succession plan.

The Board also oversees management’s succession planning for other key executive positions. Our Board calendar includes at least one meeting each year at which the Board conducts a detailed talent review which includes a review of the Company’s talent strategies, leadership pipeline and succession plans for key executive positions.

Additionally, the results of the Company’s Annual Colleague Experience Survey are reviewed each year in detail with the Board. Our Annual Colleague Experience Survey provides insights into employee satisfaction, leadership efficacy, learning opportunities, and career development. The insights provided by the survey help improve the American Express employee experience, workplace culture and business results. We believe that maintaining our strong workplace culture, adhering to our Blue Box Values and ensuring that our people feel valued, recognized, and backed will help us attract, retain and develop the right talent to lead the Company and successfully execute our corporate strategy. Please see page 35 for additional information about our workplace culture.

How our Board Oversees Risk Management

Board of Directors

We are committed to Board-level risk management. Our Board monitors our “tone at the top” and risk culture and oversees emerging strategic risks. Risk management is overseen by our Board through three Board committees: Risk, Audit and Compliance, and Compensation and Benefits. Each committee consists entirely of independent directors and provides regular reports to the Board regarding matters reviewed at their committee. The committees meet regularly in executive sessions with our Chief Risk Officer, Chief Compliance & Ethics Officer, Chief Audit Executive and other senior management with regard to our risk management processes, controls, talent and capabilities.

Board Oversight of Information and Cyber Security

We are a global financial services company and understand the substantial operational risks for companies in our industry as well as the importance of preserving the trust of our customers and securing their personal information. To that end, we have an extensive cybersecurity governance framework in place. Our Board receives reports on cybersecurity at least once a year and our Risk Committee receives reports on cybersecurity at least twice a year, including in at least one joint meeting with the Audit and Compliance Committee, and all receive ad hoc updates as needed. In addition, the Risk Committee annually approves the Company’s Information Security Program.

We have a very experienced information security team and we actively develop and recruit leadership and specialists from both the government and private sector. We have implemented an Information Security Program and Operating Model that is designed to protect the confidentiality, integrity and availability of information and information systems from unauthorized access, use, disclosure, disruption, modification or destruction. Our Information Security Program and Operating Model are based on the National Institute of Standards and Technology (NIST) Cybersecurity Common Standards Framework, which consist of controls designed to identify, protect, detect, respond to and recover from information and cyber security incidents. The framework defines risks and associated controls which are embedded in our processes and technology. Those controls are measured and monitored by a combination of subject matter experts and a security operations center with our integrated cyber detection, response and recovery capabilities.

Program Highlights

 

We have a robust Cyber Crisis Response Plan in place which provides a documented framework for handling high severity security incidents and facilitates coordination across multiple parts of the Company.

 

We deploy a defense-in-depth strategy with multiple layers of controls including embedding security into our technology investments.

 

We invest in threat intelligence and are active participants in industry and government forums to improve sector cybersecurity defense.

 

We collaborate with our peers in the areas of threat intelligence, vulnerability management and response and drills.

 

We routinely perform simulations and drills at both a technical and management level.

 

We incorporate external expertise and reviews in all aspects of our program.

 

All colleagues receive annual cybersecurity awareness training.

We continuously assess the risks and changes in the cyber environment and dynamically adjust our program and investments as appropriate.

How our Management Oversees Risk

We use our comprehensive Enterprise-Wide Risk Management (ERM) program to identify, aggregate, monitor and manage risks. The program also defines our risk appetite, governance, culture and capabilities. The implementation and execution of the ERM program is headed by our Chief Risk Officer.

There are several internal management committees, including the Enterprise-wide Risk Management Committee (ERMC), chaired by our Chief Risk Officer. The ERMC is the highest-level management committee to oversee all firm-wide risks and is responsible for risk governance, risk oversight and risk appetite. It maintains the enterprise-wide risk appetite framework and monitors compliance with limits and escalations defined in it. The ERMC oversees implementation of risk policies Company-wide. The ERMC reviews key risk exposures, trends and concentrations, significant compliance matters, and provides guidance on the steps to monitor, control and report major risks.

Our Board Committees

In July 2019, after a holistic review of the Board’s standing committee structure, our Board approved the reduction of its standing committees from six to four by dissolving the Innovation and Technology Committee and the Public Responsibility Committee. The topics previously covered by the Innovation and Technology Committee are now covered by the full Board. Our Board made this decision at this point in time given the Company’s digital evolution since the inception of the committee in 2010 and the fact that technology now permeates every aspect of the Company. The topics previously covered by the Public Responsibility Committee are now covered by the newly renamed Nominating, Governance and Public Responsibility Committee to allow for elevated oversight of environmental and social issues. In connection with the committee restructuring, our Board revised its standing committee membership effective October 1, 2019.

Our Board’s current standing committee membership information is listed on the following pages. Effective March 9, 2020, our Board approved revisions to the membership of our standing committees. Each current member of our standing committees and each member in 2019 was independent and fulfilled the requirements applicable to each committee on which they served.

Board Committee Responsibilities

Our Corporate Governance Framework

We have adopted Corporate Governance Principles that, together with the charters of the four standing committees of the Board (Audit and Compliance, Compensation and Benefits, Nominating, Governance and Public Responsibility and Risk), our Code of Conduct (which constitutes our code of ethics for colleagues) and the Code of Business Conduct for Members of the Board of Directors, provide our governance framework. Key governance policies and processes also include our Whistleblower Policy, our comprehensive Enterprise-Wide Risk Management Program, our commitment to transparent financial reporting and our systems of internal checks and balances. Comprehensive management policies, many of which are approved at the Board committee level, guide the Company’s operations.

Our Board, along with management, regularly reviews our Corporate Governance Principles and practices to ensure that they are appropriate and reflect our high standards and Blue Box Values. In reviewing our Corporate Governance Principles and making recommendations, the Nominating, Governance and Public Responsibility Committee considers the views of shareholders expressed to us in engagement meetings, as well as publicly available discourse on governance.

You may view the following documents by clicking on the “Corporate Governance” link found on our Investor Relations webpage at http://ir.americanexpress.com and then selecting “Governance Framework.” You may also access our Investor Relations webpage through our main website at americanexpress.com by clicking on the “About American Express” link, which is located at the bottom of the Company’s homepage. You may also obtain free copies of the following materials by writing to our Company’s Corporate Secretary:

Majority Voting Standard for Director Elections

In a non-contested election, directors are elected by a majority of “for” votes cast by shareholders. A non-contested election is an election where the number of nominees is the same as the number of directors to be elected. If a director receives a greater number of votes “against” than votes “for” his or her election, the director is required to immediately submit his or her resignation to the Board. The Board, excluding such individual, will decide whether or not to accept such resignation and will promptly disclose and explain its decision in a Form 8-K filed with the Securities and Exchange Commission (SEC).

In a contested election, the director nominees who receive the plurality of votes cast are elected as directors. Under the plurality standard, the number of persons equal to the number of vacancies to be filled who receive more votes than other nominees are elected to the Board, regardless of whether they receive a majority of votes cast. An election is considered contested under our Certificate of Incorporation if there are more nominees than positions on the Board to be filled at the meeting of shareholders as of the fourteenth day prior to the date on which we file our definitive proxy statement with the SEC.

Proxy Access

A shareholder or group of no more than 20 shareholders that has owned at least 3% of our common shares for at least three years may nominate directors to our Board and include the nominees in our proxy materials to be voted on at our Annual Shareholder Meeting. The maximum number of shareholder nominees that will be included in our proxy materials with respect to any such Annual Shareholder Meeting is the greater of (i) two or (ii) 20% of directors to be elected. A shareholder who seeks to nominate a director or directors to our Board must provide proper notice to the Company’s Corporate Secretary under the terms of our bylaws.

Director Attendance

During 2019, our Board met six times and our committees met 37 times (in the aggregate and including the meetings held by the Innovation and Technology Committee and Public Responsibility Committee prior to their dissolution). All directors attended 75% or more of the meetings of the Board and Board committees on which they served in 2019.

All of our directors, with the exception of one, serving on our Board at the time of our 2019 annual meeting attended the meeting. Our Board strongly encourages all of its members to attend the annual meeting but understands there may be exigent circumstances.

Our meeting attendance policy is set forth in our Corporate Governance Principles.

Executive Sessions

Executive sessions of independent directors, led by our Lead Independent Director, enable the Board to discuss matters, such as strategy, CEO and senior management performance and compensation, succession planning and board effectiveness, without management present. Any director may request additional executive sessions of independent directors. During 2019, our independent directors met in executive session at each regularly scheduled Board meeting.

Our Board’s Size

Our Corporate Governance Principles provide that while the Board need not adhere to a fixed number of directors, generally a board of 12-14 directors offers a sufficiently large and diverse group to address the important issues facing the Company and provides a wide range of perspectives while being small enough to encourage personal involvement and discussion.

Trading in Company Securities

We prohibit hedging and pledging transactions in Company securities by executive officers and directors. Employees that are not executive officers are also prohibited from hedging Company securities and discouraged from pledging Company securities and may only due so if certain criteria are met.

Additionally, we require members of senior management as well as our directors to pre-clear every transaction in Company securities for themselves, their immediate family members, and any family trust with the Corporate Secretary. This includes gifts, transactions in discretionary accounts and non-routine transactions such as optional cash purchases in the Dividend Reinvestment Plan.

Our Board’s Independence

Our Corporate Governance Principles provide that a substantial majority of our directors will meet the criteria for independence required by the New York Stock Exchange (NYSE). A director is considered independent if the Board determines that he or she does not have a material relationship with the Company. In making its annual independence determinations, the Board considers transactions between each director nominee and the Company. Our Board has established guidelines to assist it in determining director independence. These guidelines can be found within our Corporate Governance Principles and cover, among other things, employment and compensatory relationships, relationships with our auditors, customer and business relationships, and contributions to nonprofit organizations.

Based on our guidelines, the Board determined in March 2020 that all of its members in 2019, other than Mr. Squeri, and all of the Board’s director nominees for election at the 2020 annual meeting, other than Mr. Squeri, are independent.

Ambassador Barshefsky is a partner at the law firm of WilmerHale, an international law firm based in Washington, D.C. From time to time and in the ordinary course of its business, WilmerHale provides legal services to American Express that we consider to be de minimus in nature. Ambassador Barshefsky does not provide any such legal services, and she does not receive any compensation from the firm that is generated by or related to our payments to WilmerHale for such services. The Nominating, Governance and Public Responsibility Committee determined, based on fees paid to the firm over the past three years, that WilmerHale does not perform substantial legal services for the Company on a regular basis. The fees and expenses paid to WilmerHale represented less than 1% of the firm’s annual revenue in each of the past three years and represented less than 0.1% of American Express’ revenues in each such year. Further, the Nominating, Governance and Public Responsibility Committee reviewed the nature of American Express’ engagement of WilmerHale and the services rendered, including the expertise and relevant experience of the firm and the specific partners engaged to work on the matters for which we have engaged the firm, and determined that Ambassador Barshefsky’s service on American Express’ Board should not impair American Express’ ability to engage WilmerHale when American Express determines such engagements to be appropriate and in our best interests. The committee is satisfied that WilmerHale, when engaged for legal work, is chosen by American Express’ legal group on the basis of the directly relevant factors of experience, expertise and efficiency. After considering the foregoing, the committee determined and recommended to the Board that American Express’ professional engagement of WilmerHale does not impair Ambassador Barshefsky’s independence.

Shareholder Engagement

Our Board’s Commitment to Shareholder Engagement

Our directors and management recognize the benefits that come from robust dialogue with shareholders and other relevant parties and we have embraced an active engagement strategy for many years. We engage with shareholders throughout the year in order to:

Following our 2019 Annual Meeting, we engaged with shareholders representing approximately 48% of our outstanding shares on corporate governance, executive compensation and related matters. During these meetings, depending on the investor’s priorities, we discussed and sought direct feedback on a broad number of issues including company strategy and performance, board composition, corporate social responsibility and our executive compensation programs. Please see “Shareholder Engagement and Responsiveness to 2019 Say-on-Pay Vote” starting on page 44, for a detailed discussion of the changes we have made to our executive compensation program in response to this shareholder feedback. The below table provides a snapshot of our ongoing engagement process and outcomes.

How to Communicate with our Board

You may communicate with the Board or an individual director by letter, email or telephone, directed in care of the Company’s Corporate Secretary, who will forward your communication to the intended recipient. However, at the discretion of the Corporate Secretary, materials considered to be inappropriate or harassing, unsolicited advertisements, or promotional materials and invitations to conferences may not be forwarded.

If you have an inquiry about our financial statements, accounting practices or internal controls, please direct your concern to the Chair of the Audit and Compliance Committee. If the inquiry relates to our governance practices, business ethics or corporate conduct, it should be directed to the Chair of the Nominating, Governance and Public Responsibility Committee or the Lead Independent Director. Matters relating to executive compensation may be directed to the Chair of the Compensation and Benefits Committee. If you are unsure of the category to which your concern relates, you may communicate it to any one of the independent directors, to the Lead Independent Director or to the Chairman.

Please direct such communications in care of the Corporate Secretary as follows:

Tangela S. Richter

Corporate Secretary and Chief Governance Officer

American Express Company

200 Vesey Street

New York, NY 10285

(212) 640-2000

corporatesecretarysoffice@aexp.com

Compensation of Directors

The Nominating, Governance and Public Responsibility Committee reviews director compensation and seeks to compensate our directors in a manner that attracts and retains highly qualified directors and aligns the interests of our directors with those of our long-term shareholders. No changes were made to the Company’s non-management director compensation programs for 2019.

The following table provides information on the 2019 compensation of non-management directors who served for all or a part of 2019. We reimburse directors for reasonable out-of-pocket expenses attendant to their board service.

Director Stock Ownership

Our Corporate Governance Principles provide that non-management directors are required to obtain a personal holding of shares (directly or through SEUs) with a value of $1 million within five years of joining the Board. All non-management directors have achieved or are on track to achieve this requirement during the required time period.

Director and Officer Liability Insurance

We have an insurance program in place to provide coverage for director and officer liability. The coverage provides that, subject to the policy terms and conditions, the insurers will: (i) reimburse us when we are legally permitted to indemnify our directors and officers; (ii) pay losses, including settlements, judgments and legal fees, on behalf of our directors and officers when we cannot indemnify them; and (iii) pay our losses resulting from certain securities claims. A portion of the insurance program is blended with certain other insurances covering the Company. The insurance program is effective from November 30, 2019 to November 30, 2020 and is provided by a consortium of insurers. ACE American Insurance Company and XL Specialty Insurance Company are the lead insurers with various other insurers providing excess coverage. We expect to obtain similar coverage upon expiration of the current insurance program. The annual premium for the insurance program is approximately $4.8  million.

Certain Relationships and Transactions

In the ordinary course of our business, we engage in transactions, arrangements and relationships with many other entities, including financial institutions and professional organizations. Some of our directors, director nominees, executive officers, greater than 5% shareholders, and their immediate family members (each, a Related Person) may be directors, officers, partners, employees or shareholders of these entities. We carry out transactions with these entities on customary terms and, in many instances, these Related Persons may not have knowledge of them. To the Company’s knowledge, since January 1, 2019, no Related Person has had a material interest in any of our ongoing business transactions or relationships except as described on the following page.

Our Related Person Transaction Policy

Our written Related Person Transaction Policy governs company transactions, arrangements and relationships involving more than $120,000 in which a Related Person has a direct or indirect material interest (Related Person Transactions). Under the policy, Related Person Transactions must be approved by the Nominating, Governance and Public Responsibility Committee, other than certain pre-approved transactions (described below). The Committee will only approve a transaction if, after reviewing the relevant facts and circumstances, it determines that the transaction is consistent with the best interests of the Company. In the event we become aware of a Related Person Transaction that was not approved under the policy, the Committee will consider the options available, including ratification, revision or termination of the transaction. The policy does not supersede any other company policy or procedure that may apply to any Related Person Transaction, including our Corporate Governance Principles and codes of conduct.

The Company’s Corporate Secretary is responsible for assisting the Nominating, Governance and Public Responsibility Committee in carrying out its responsibilities, and management is required to present to the committee the material facts of any transaction that it believes may require review. In cases when it is impracticable or undesirable to delay a decision on a proposed transaction until the next meeting of the Nominating, Governance and Public Responsibility Committee, the Chair may review and approve the transaction and then report any approval to the full committee at its next regularly scheduled meeting. If a matter before the Nominating, Governance and Public Responsibility Committee involves a member of the committee, the member must be recused and may not participate in deliberations or vote on the matter.

Pre-Approved Categories of Related Person Transactions

The Nominating, Governance and Public Responsibility Committee has pre-approved certain categories of transactions as being consistent with the best interests of the Company. These categories, which may exceed the proscribed threshold for Related Person Transactions, include but are not limited to, director and executive officer compensation, use of Company products and services, transactions involving indebtedness to the Company, certain banking-related transactions, immaterial ordinary course transactions with other entities, charitable contributions and indemnification payments.

Related Party Transactions

Our executive officers and directors may from time to time take out loans from certain of our subsidiaries on the same terms that these subsidiaries offer to the general public. For example, our U.S. card-issuing bank may extend credit to our directors and executive officers under our charge or lending products. All indebtedness from these transactions is in the ordinary course of our business and is on the same terms, including interest rates and collateral, in effect for comparable transactions with other people. Such indebtedness involves normal risks of collection and does not have features or terms that are unfavorable to our subsidiaries. Our executive officers and directors may also enter into transactions with us involving other goods and services, such as travel services and investments in deposit products offered by subsidiaries of the Company. These transactions are also in the ordinary course of our business, and we provide them on terms that we offer to our customers generally. Occasionally, we may have employees who are related to our executive officers, directors or director nominees. We compensate these individuals in a manner consistent with our practices that apply to all employees. The sister-in-law of Mr. Squeri, our Chairman and CEO, is employed by the Company in a non-executive position and received compensation in 2019 of between $270,000 and $300,000. The compensation and other terms of employment of Mr. Squeri’s sister-in-law are determined on a basis consistent with the Company’s human resources policies.

Certain executive officers, directors and members of their immediate families are directors, employees or have equity interests in companies with whom the Company has entered into ordinary course business relationships from time to time and with whom the Company may enter into additional ordinary course business relationships. These may include ordinary course merchant acceptance relationships pursuant to which these companies accept our charge and credit card products and pay us fees when their customers use these cards, as well as use of the Company’s cards and financial and other products and services, including extensions of credit, on terms and conditions similar to those available to other customers generally. From time to time, we may enter into joint marketing or other relationships with one or more of these companies in the ordinary course that encourage customers to apply for and use our cards. We have periodically engaged Martellus Group (Martellus), a consulting company where the spouse of our Chief Risk Officer, Mr. Raymond Joabar, is a co-owner. Each transaction was conducted on, and all services were provided in, the ordinary course of business and on arm’s-length terms. In 2019, we made aggregate payments to Martellus of approximately $400,000 for consulting services. We also may provide ordinary course commercial card and bill payments services or business insights to some of these companies, for which these companies pay fees to us. We may engage in other commercial transactions with these companies, and pay or receive fees in those transactions. We have a number of similar ordinary course relationships with Berkshire Hathaway Inc. and its subsidiaries. We have also purchased insurance and other products from subsidiaries of Berkshire Hathaway Inc. in the ordinary course of business and on arm’s-length terms. Additionally, the Company may from time to time make charitable contributions to not-for-profit organizations where our directors or executive officers are directors or trustees.

The Powerful Backing of American Express

We provide powerful backing to the communities where our customers and employees (whom we refer to as colleagues) live and work.

How We Approach Environmental, Social and Governance (ESG)

Our approach to environmental, social and governance (ESG) is a natural extension of both our mission—to become essential to our customers by providing differentiated products and services to help them achieve their aspirations—and our commitment to doing what is right. We deliver value for both our business and our communities by investing financial and human resources in ways that address the social, environmental, and economic needs of our communities, customers, colleagues, shareholders, and partners.

We view service through many lenses:

All of this is underscored by disciplined risk management that ensures we are building a Company that will endure as a place where people want to work, invest, and do business.

Governance

Our executive management reviews and evaluates performance and long-term goals with respect to environmental, social and governance matters within their business units.

At the Board of Directors level, the Nominating, Governance and Public Responsibility Committee reviews our Corporate Social Responsibility (CSR) program, monitors progress against our goals, and provides guidance on our efforts. Day to day, our CSR team works with colleagues throughout the Company to shape our efforts and monitor progress on key issues.

We are currently in the process of reviewing our environmental, social and governance priorities. We are also conducting a scenario analysis aligned to the Task Force on Climate-related Financial Disclosures (TCFD) framework to assess risks and opportunities related to climate change.

Strategic Engagement

Our strategy begins by identifying our key stakeholders, then engaging with them to understand the environmental, social and governance issues that matter to them, and the impact those issues have on our business. We have identified eight key stakeholder groups based on their impact on our business activities including shareholders, colleagues, customers (Card Members, businesses and merchants), governments and regulators, suppliers, community and nongovernmental organizations, ESG research and rating agencies, and partners and peers. Our continued engagement with these stakeholders helps ensure we are meeting their expectations and advancing our efforts to operate responsibly.

2019 HIGHLIGHTS

Our New Environmental Commitments and Goals

As first announced in our 2018-2019 Corporate Social Responsibility report, the following are our new aspirational environmental commitments and goals:

Our Ratings

We monitor our performance across a number of environmental, social and governance related ratings and rankings. In each of the following, we outperform or are in line with our peers.

Our Workplace Culture

Our colleagues are instrumental in enabling the Company to deliver on its vision to provide the world’s best customer experience every day. To attract and retain the best talent, we continuously invest in programs, benefits and resources to ensure our colleagues can grow in their careers and thrive professionally and personally. Our focus has helped us build a reputation for being an employer of choice, earning a spot among the top 20 companies on Fortune’s ranking of the World’s Most Admired Companies for the last ten years. In addition, we were recently ranked number nine on the 2020 Fortune 100 Best Companies to Work For list in the U.S.

We are committed to making sure our colleagues are as diverse as our customers and the communities where we live and work. We value and embrace differences, and believe unique perspectives, backgrounds and experiences are critical to our success. Fostering an inclusive culture helps us maintain an environment where all colleagues are engaged, have a voice, and can thrive. At American Express, being yourself matters. Our Colleague Networks play an important role in creating a culture of belonging at American Express, providing opportunities for colleagues to meet with others of shared backgrounds and interests to engage and learn from each other. We have 16 networks with nearly 100 chapters globally, encompassing the full spectrum of diversity, including disability, ethnicity, faith, gender, gender identity, generations, sexual orientation and veteran status. Networks include the Black Engagement Network (BEN), Hispanic Origin and Latin American Network (HOLA), and PRIDE, our LGBTQ+ network. We have also provided inclusive leadership and unconscious bias training to all colleagues across the Company, to motivate specific, effective behaviors for managing bias and develop skills to build inclusive, high-performing teams.

In addition, we place a strong focus on continuous professional development as the ability to constantly learn is critical to the success of our people and our business. We provide learning opportunities in many forms, including tools and guidance for maximizing learning on the job; cross-border and cross-business unit assignments; career coaching, mentoring, and professional networking; rotation opportunities; virtual learning sessions; and formal classroom instruction. Through the American Express Leadership Academy, we provide training and development experiences tailored to individuals at all levels of the company that are designed to instill specific behaviors that drive successful leadership.

The health and wellbeing of our colleagues plays an integral role in their ability to thrive at work and at home. We take a holistic approach to wellbeing, providing resources that address the physical, financial, and emotional health of our colleagues and their families. Last year, we celebrated the tenth anniversary of Healthy Living, our award-winning corporate wellness program that provides supportive resources, enhanced access to care and incentives to foster a healthier lifestyle, including through on-site health centers, healthful dining options in our cafeterias, and a range of programs to help colleagues address health concerns. Our Healthy Minds program provides colleagues access to free, confidential professional counseling to help plan for life events, address personal challenges, and manage everyday events that impact work, health, and family. We built on this initiative in 2019 by making available to all colleagues virtual training designed to help educate colleagues on the signs of mental stress and how to support co-workers who may be impacted by mental health issues.

Learn More about Environmental, Social and Governance Matters at American Express

Please visit http://about.americanexpress.com/corporate-responsibility-reports to learn how we, together with our customers, colleagues and shareholders, are making a difference in our communities and https://www.americanexpress.com/us/company/global-diversity-and-inclusion.html to learn more about our commitment to making sure our colleagues are as diverse as our customers and communities.

Actions Taken by the Audit and Compliance Committee to Support its Recommendation