LNC Lincoln National Corporation

Item 3 | Advisory Proposal on Executive Compensation

Item 3 | Advisory Proposal on Executive Compensation

The Board recognizes that providing shareholders with an advisory vote on executive compensation can produce useful information on investor sentiment regarding the Company’s executive compensation programs. As a result, this proposal provides shareholders with the opportunity to cast an advisory vote on the compensation of our executive management team, as described in the section of this proxy statement entitled “Compensation Discussion & Analysis” (“CD&A”), and endorse or not endorse our fiscal 2019 executive compensation philosophy, programs and policies, and the compensation paid to the Named Executive Officers. As discussed in detail in the CD&A that begins on page 28, our executive compensation principles and underlying programs are designed to:

Key features of our compensation programs include:

Pay for Performance.  We link our executives’ targeted direct compensation to the performance of the Company as a whole, with the largest portion delivered as variable pay in the form of long-term equity awards and an annual incentive award. For instance, in 2019, 90% of our CEO’s compensation was at risk and variable.

Compensation Tied to Enterprise Performance and Shareholder Return.  Our annual and long-term incentive compensation programs have multiple balanced performance measures and goals that tie executive compensation to key enterprise performance metrics and shareholder return.

Governance/Compensation Best Practices.  Among the best practices we follow: We have an independent Compensation Committee and compensation consultant; we have caps on payouts for incentive compensation; we do not provide tax gross-up benefits upon our change of control; and we have a double-trigger equity vesting requirement upon a change of control of the Company.

Share Ownership Requirements.  Our executives are subject to rigorous share ownership guidelines to further align their interests with the long-term interests of our shareholders. For instance, our CEO is required to hold an amount of our shares equal to seven times his base salary, and our other executive officers must hold shares equal to four times their base salary.

In addition, we recognize that strong governance/compensation principles are essential to an effective executive compensation program. These governance/compensation principles and our executive compensation philosophy are established by the Compensation Committee. The Compensation Committee regularly reviews the compensation programs applicable to our executive officers to ensure that the programs support our objectives of aligning our executive compensation structure with our shareholders’ interests and current market practices.

Our compensation policies and procedures are described in detail on pages 28 to 51.

Although the advisory vote on this proposal is non-binding — meaning that our Board is not required to adjust our executives’ compensation or our compensation programs or policies as a result of the vote — the Board and the Compensation Committee will consider the voting results when determining compensation policies and decisions, including future executive compensation decisions. Notwithstanding the advisory nature of the vote, the resolution will be approved if more votes are cast for the proposal than against it. Abstentions and broker non-votes will not count as votes cast either for or against the proposal. We intend to hold a non-binding advisory vote on executive compensation each year, with the next such vote at our 2021 Annual Shareholders Meeting.

We urge you to read the CD&A and other information in the Executive Compensation Tables, beginning on page 52, which we believe demonstrate that our executive compensation programs align our executives’ compensation with our short- and long-term performance; provide the incentives needed to attract, motivate and retain key executives crucial to our long-term success; and align the interests of our executive officers with those of our shareholders.

“Resolved, that the shareholders approve, on an advisory basis, the compensation of the named executive officers of the Company, as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion & Analysis, the 2019 compensation tables regarding named executive officer compensation, and the accompanying narrative disclosure in this proxy statement.”

Compensation Discussion & Analysis

Compensation Discussion & Analysis

This Compensation Discussion & Analysis (“CD&A”) contains information about:

The CD&A also details the compensation of our NEOs (also referred to as “executives” or “executive officers”) included in the compensation tables beginning on page 52. These NEOs are:

We encourage you to read the CD&A in conjunction with the compensation tables on pages 52 to 66.

To ensure the continued effectiveness of our pay-for-performance culture, the Compensation Committee each year reviews and approves the elements, measures, targets, weightings and payouts of our executive compensation programs. In setting the programs’ performance measures and goals, the Compensation Committee chooses metrics that drive our overall corporate strategy, are linked to our long-term financial plan and reflect our shareholders’ feedback. The compensation of our executives is tied closely to the achievement of short- and long-term goals that support our long-term business strategy and measure the creation of sustainable long-term shareholder value.

At our 2019 Annual Meeting, shareholders continued to express strong support for our executive compensation programs, with over 92% of votes cast in favor of the advisory resolution on executive compensation.

Executive Summary ▪ Compensation Discussion & Analysis

Executive Summary

2019 Performance Overview

As a company that has been in business for nearly 115 years, we recognize that a focus on long-term value creation and purpose is what will keep us in the business of servicing our customers, employees, communities and shareholders for the next century and beyond.  At our core, our purpose is to provide advice and solutions that help empower people to take charge of their financial lives with confidence and optimism. We continue to deliver on this mission and our promises, which enabled us to deliver solid financial results in 2019 despite the economic headwinds facing the company and the industry, including the low interest rate environment in which we have been operating for a number of years. During 2019, we continued to focus on driving shareholder value while further advancing our strategic priorities, diversifying our mix of business and increasing operating revenues in all of our businesses through our powerful retail franchise that brings together a broad product portfolio and distribution breadth. We also continue to actively manage our capital through initiatives that we believe position us well for long-term, sustainable financial results.

Our full year results included the following highlights:

From a financial and operating standpoint, we had a solid year in 2019 as we delivered steady operating revenue growth across our core businesses, leading to record book value per share, excluding accumulated other comprehensive income (loss). We maintained a strong value proposition with customers and producers and focused on expanding our product portfolio and distribution reach. Our disciplined business approach helped us maintain attractive profit margins. These results were achieved despite a challenging environment, including the pressure of continued low interest rates.  Accomplishments this past year across our core businesses include:

▪ positive net flows in the Annuities business in every quarter totaling $1.9 billion for the full year;

▪ Life Insurance sales exceeding $1 billion as we benefited from our broad product portfolio;

▪ a 30% increase in Group Protection sales;

▪ positive net flows in the Retirement Plan Services business for the fifth consecutive year; and

▪ ending the year with $275 billion in assets under management.

In addition, we continued to be recognized for our good corporate citizenship and dedication to diversity and inclusion, as demonstrated by, among other accolades, our inclusion on the Dow Jones Sustainability Index North America and among the Forbes Just 100 and Newsweek’s 2020 America’s Most Responsible Companies, and our ranking by Forbes as Best Employer for Diversity, Best Employer for Women and a Best Large Employer.

Despite these accomplishments and our diligent focus on returning capital to shareholders, our stock price has underperformed our peers.  For 2019, our stock price increased 15% to $59.01 as of the market close on December 31, 2019 from $51.31 on December 31, 2018.  Our ending adjusted operating return on equity for 2019 was 9.7%, which includes the impact of our third quarter annual assumption review.

Compensation Discussion & Analysis ▪ Executive Summary

These charts illustrate some of the measures of our full-year results over the past three years, cumulatively and sales broken out by business unit. These measures include some of the key metrics used as the basis for our annual and long-term incentive program goals.

2017 – 2019 GAAP Net Income per Share and Adjusted Income from Operations per Share

2017 – 2019 GAAP Revenues and Adjusted Operating Revenues

Executive Summary ▪ Compensation Discussion & Analysis

2017 – 2019 Sales by Business Unit

¹ Total sales represents first year sales and recurring deposits.

More information on our business performance during 2019 is available in our Form 10-K for fiscal year ended December 31, 2019 (the “2019 Form 10-K”), which is included in the 2019 Annual Report to Shareholders that accompanies this proxy statement. A reconciliation of the measures not shown in accordance with U.S. generally accepted accounting principles (“GAAP”) used in this proxy statement to their corresponding GAAP measures can be found in Exhibit 1 on page E-1.

Compensation Discussion & Analysis ▪ Executive Summary

Our Pay for Performance Philosophy

We believe that those executives with significant responsibility and a greater ability to influence the Company’s results should have a significant portion of their total compensation tied directly to business results. Therefore, the vast majority of our NEO compensation is tied to Company or individual performance (and, for business-unit executives, to the performance of individual business units). This also means that the vast majority of our NEO compensation is “at risk”— meaning that an executive will not reach his or her targeted pay amounts if the Company’s performance does not meet expectations.

In keeping with this philosophy, annual and long-term incentive awards are the largest components of total NEO compensation, and the fixed pay element — base salary — is the smallest. The variable components are:

As the following charts show, the vast majority of our CEO’s and NEOs’ target direct compensation is variable (i.e., based on performance, including that of our stock price) and at risk.

Note, the amounts in these graphs are shown at target and therefore will not match the values reflected in the Summary Compensation Table at page 52 of this proxy statement.

Looking Forward

For 2020, our CEO’s target direct compensation will remain at 2019 levels. In addition, for 2020, the Compensation Committee increased the alignment of CEO compensation with Company performance and shareholder interests by adjusting our CEO’s LTI equity award mix to increase the percentage of equity granted as PSAs and stock options, consistent with our fundamental pay for performance philosophy.  The LTI equity award mix for 2020 is shown below.

2019 LTI MIX FOR CEO      2020 LTI MIX FOR CEO

2019 Shareholder Engagement and Response to Feedback

We value our shareholders’ view and insights, which is why last year we extended our proactive shareholder engagement program with a specific focus on corporate governance, compensation and environmental and social practices.  This program complements the ongoing dialogue throughout the year among our shareholders, CEO, CFO and Investor Relations team on financial and strategic performance.  Our engagement program is designed to reach out to our shareholders and hear their perspectives about issues that are important to them, both generally and with regard to the Company, and gather feedback.  We believe this engagement program promotes transparency between our Board and our shareholders and builds informed and productive relationships.

In the fall of 2019, we reached out to investors representing over 40% of our shares outstanding and discussed various topics including board refreshment and composition, the board evaluation process, company culture, executive compensation and areas of focus for our shareholders regarding environmental and social practices.  The result of this outreach was substantive engagement with more than half of these investors.  The feedback from these meetings was shared with the Corporate Governance Committee and the Compensation Committee as well as the full Board.  This feedback strongly informed the enhancements that were made to this proxy statement to further improve transparency.

Our Executive Compensation Program Pay for Performance Philosophy ▪ Compensation Discussion & Analysis

Our Executive Compensation Program Pay for Performance Philosophy

Our executive compensation program has three key objectives:

These objectives, discussed below, guide us in setting and paying compensation to our NEOs.

Pay for Performance

Our executive compensation program is based on a “pay for performance” philosophy: the majority of our executives’ target compensation is made up of variable (“at risk”) compensation — in the form of annual cash incentive awards and long-term equity awards — that is linked to short- and long-term business performance and each individual’s contribution to that performance. In measuring an executive’s contribution, we put a strong emphasis on the individual’s role in implementing strategies and driving performance specific to their function or the operating units they direct.

The key objectives of our pay for performance philosophy are to:

Balanced Performance Measures and Goals

It is important to us and to our executives that performance goals be objectively measurable and that compensation be paid based on easily understood criteria that drive shareholder value.

To implement our pay for performance philosophy, the Compensation Committee with consultation from external compensation experts chooses performance measures for our NEO incentive programs that focus on our overall corporate business strategies and that, if achieved, create sustained growth for our shareholders:

The goals for each performance measure are linked directly to the Company’s financial plan. In setting the goals, management and the Compensation Committee intend for the target performance levels to be challenging yet attainable and the maximum performance levels to present a substantial challenge for our NEOs, thereby creating a strong incentive to produce superior results. Annually, the Compensation Committee reviews the performance measures to ensure that the metrics selected are aligned with our corporate strategy. The Company’s overall corporate strategy continues to focus on balancing top-line revenue growth with profitability and prudent cost management, and, as a result, for 2019, the Compensation Committee continued to align our executive compensation accordingly by choosing the following performance measures:

Compensation Discussion & Analysis ▪ Our Executive Compensation Program Pay for Performance Philosophy

Alignment with Shareholders

Through our annual and long-term incentive compensation programs, our share ownership requirements and share retention policy and the design and governance features of our long-term equity programs, we tie the financial interests of our NEOs to those of our shareholders. For both the annual and long-term programs, the Compensation Committee chooses performance goals that align with our strategies for sustained growth and profitability.

Long-Term Incentives

The equity-based awards that comprise our long-term incentive compensation are the largest percentage of our NEOs’ targeted direct compensation (69% in the case of our CEO and 53% on average in the case of our other NEOs). To provide a balanced incentive program and to lessen the risk inherent in the greater focus on long-term incentives, executives receive a mix of equity-based compensation awards, which include:

Share Ownership Guidelines and Share Retention Requirements

Our share ownership requirements formalize the Compensation Committee’s belief that our officers should maintain a material personal financial stake in the Company. The requirements also promote a long-term perspective in managing our business by linking the long-term interests of our executives with those of our shareholders and reducing the incentive for short-term risk-taking.

Our robust share ownership and share retention requirements are among the most stringent in place at companies in the S&P 500, providing a significant alignment of our executives with shareholders through the risks and rewards of stock ownership. The share ownership requirements are based on multiples of base salary and vary by job level. In addition to the minimum share ownership levels, each NEO must also retain an amount equal to 25% of the net profit shares resulting from equity-based LTI grants, such as vested RSUs or earned PSAs. This additional number of shares must be held for five years from the date of exercise for Options or the date of vesting for other awards. If at any point an NEO does not meet the share ownership requirements, the executive must

Consideration of Our 2019 Shareholder Vote on Executive Compensation ▪ Compensation Discussion & Analysis

hold 50% of the net profit shares resulting from equity-based LTI awards that are exercised or vest, as applicable, until the required ownership level is met. As of December 31, 2019, each of our NEOs was exceeding their share ownership requirements.

The table below shows our share ownership guidelines and share retention requirements by officer tier:

Equity interests counted in determining whether share ownership guidelines have been met include:

Prohibition on Pledging and Hedging  

Our Insider Trading and Confidentiality Policy includes provisions that prohibit: (i) the pledging of our securities by our executive officers; and (ii) the use of derivative instruments by any employee to hedge the value of any of our securities. The full text of our Insider Trading and Confidentiality Policy is available on the Corporate Governance page of our website at www.lfg.com.

Multiyear Performance and Vesting Periods

The multiyear performance criteria and vesting elements of our long-term incentive programs promote the retention of our executives by putting their focus on our long-term performance, thereby aligning our executives’ interests with those of shareholders.

Prohibition on Repricing

Our equity incentive compensation plans prohibit us from reducing the exercise price of outstanding Options without shareholder approval.

Clawback Features

The equity awards for our NEOs are subject to “clawback” and forfeiture provisions, which allow us to rescind an executive’s award(s) under certain conditions, such as:

For example, if an executive violates any such restriction or is terminated for cause prior to or within six months after the vesting of any portion of an equity award, such as Options or a PSA, we may rescind the exercise or award and require the executive to return any gain realized or value received.

Competitive Compensation

In general, we target our executives’ total direct compensation — i.e., base salary, targeted annual incentive compensation and targeted long-term incentive compensation — at the median of the compensation paid to executives in similar positions at the insurance-based financial services and investment management companies with which we compete for talent. We then adjust the compensation as we believe appropriate given our executives’ experience and tenure and the scope of their roles and responsibilities. Because the roles and responsibilities of our executives are unlikely to be identical to those of executives with similar titles/roles in our peer companies, we often consider multiple sources of market data for this purpose. However, market data are only one of many factors considered when setting executive compensation targets. For more information on how we set target compensation and our benchmarking processes, please see “Setting Target Compensation” below.

Consideration of Our 2019 Shareholder Vote on Executive Compensation

The Compensation Committee and the Board appreciate and value the views of our shareholders. At our 2019 Annual Meeting of Shareholders, over 92% of shareholder votes were cast in favor of the “say on pay” advisory resolution on executive compensation. We review the program design on an annual basis, and in light of the support for our compensation program expressed by our shareholders through both engagement and historical levels of support for our “say on pay” advisory resolution, there have not been any significant changes to our compensation program in the last several years.  However, for 2020, the CEO’s

Compensation Discussion & Analysis ▪ Setting 2019 Target Compensation

target direct compensation, including his base salary, was maintained at 2019 levels.  In addition, in response to the feedback shared by our shareholders through our robust shareholder engagement program, the Compensation Committee increased the alignment of CEO compensation with Company performance and shareholder interests by adjusting our CEO’s LTI equity award mix for 2020 to increase the percentage of equity granted as PSAs and Options.

Setting 2019 Target Compensation

The Compensation Committee made compensation decisions for the 2019 calendar year for the NEOs based on a detailed analysis of Company-specific and external data.

External Benchmarking

The Compensation Committee uses a comprehensive competitive compensation analysis to set target direct compensation levels for our NEOs. For 2019, this analysis included a review of our competitors’ base pay, annual incentive opportunities, long-term incentive values, and total direct compensation (the sum of the elements listed here) to establish market rates for each executive officer position, followed by a comparison of our current executive compensation levels to the market median of our peers.

For each of our NEOs, market data was drawn from the stock companies included in the Willis Towers Watson 2018 Diversified Insurance Study of Executive Compensation (the “Towers DI Study”). We have used the Towers DI Study for over 10 years, and if the stock companies included in the study are changed, we reflect those changes in our benchmarking peer group. In 2018, Brighthouse Financial and Protective Life were added to the Towers DI Study, resulting in a corresponding change to our peer group. This list also reflects the continued changes to traditional life and annuity companies resulting from mergers, acquisitions, divestitures, spin-offs and privatization across the insurance industry. The Compensation Committee believes that these companies are appropriate for compensation benchmarking because, even though none has our exact business mix, each is a competitor in one or more of our core business units and each competes directly with us for talent and distribution of our products. Most of these peer companies compete with us in two or more lines of business, and the table below highlights which peers are a top-15 competitor in our core businesses. None of the companies in our peer benchmarking group are solely property and casualty companies, which the Compensation Committee believes is appropriate given that such companies have significantly different business and risk profiles than traditional life and annuity companies and do not compete with us directly for business or talent.

The Compensation Committee has generally determined not to exercise discretion to remove or add peers to the benchmarking group derived from the Towers DI Study to keep a consistent peer group year-over-year. However, because some of these companies have either higher or lower market capitalization, assets or revenue than we do, the data are size-adjusted, where possible, to develop comparable market rates for a hypothetical organization of similar size and type to our own. In addition, the Compensation Committee will remove a company from the benchmarking group if the company’s business mix changes such that it is no longer an appropriate peer.

Setting 2019 Target Compensation ▪ Compensation Discussion & Analysis

The market data described on page 38 was used as a primary reference for most roles. The Compensation Committee seeks to target total direct compensation within a competitive range of plus or minus 15% of the 50^th percentile of the market data being used. Because the roles and responsibilities of our executives are unlikely to be identical to those of executives with similar titles/roles in our peer companies, we often consider multiple sources of market data for this purpose. However, market data are only one of many factors considered when setting executive compensation targets. In some cases, the Compensation Committee may target compensation above or below this range. Reasons for doing this include:

Tally Sheets

When making compensation decisions, the Compensation Committee considers:

The tally sheets enable the Compensation Committee to analyze the value of total target compensation, as well as the value of compensation actually realized compared with the value of compensation opportunities the Compensation Committee originally established.

The Compensation Committee also uses the tally sheets to assess whether our executive compensation program is consistent with our compensation philosophy and desired positioning relative to the market data. However, tally sheets are just one point of information the Compensation Committee uses to determine NEO compensation. The Compensation Committee performed a similar analysis to establish the total targeted direct compensation for our CEO.

Total Targeted 2019 Direct Compensation

The table below shows the total targeted direct compensation set by the Compensation Committee for our NEOs for 2019:

Compensation Discussion & Analysis ▪ Annual Cash Compensation for 2019

Annual Cash Compensation for 2019

During 2019, annual cash compensation was made up of base salary and a short-term incentive award under the AIP.

Base Salary

Base salaries are reviewed annually for market competitiveness and upon promotion or following a change in job responsibilities and are based on market data, internal pay equity and performance. In general, base salaries are targeted to the 50^th percentile of the market data developed during the benchmarking process described above.  In setting base salary levels for 2019, the Compensation Committee started with the 2018 base salaries and then approved merit increases based on the benchmarking data and compensation analysis discussed above as well as the individual performance of each NEO, using our enterprise-wide merit increase budget as a guide. Base salary increases for our NEOs ranged from 3% to 6% for 2019.  Mr. Fuller received an increase of 5% in recognition of his performance, and Ms. Cooper received an increase of 6% to reflect an increase in her responsibilities.

The Compensation Committee approved the following base salaries for our NEOs effective during 2019:

2019 Payout Opportunities

The table below shows the dollar amount of the threshold, target and maximum payout opportunities for the 2019 AIP established by the Compensation Committee for each of our NEOs; the threshold, target and maximum opportunities are calculated as a percentage of each NEO’s base salary. Payouts under the 2019 AIP are capped at the maximum amount.  The threshold opportunity would be payable only in the case where the threshold goal is met for the performance measure with the lowest percentage payout amount.

2019 Performance Measures and Goals

In February 2019, the Compensation Committee established the goals and measures for the 2019 AIP.

Performance Measures. The Committee selected the three performance measures for 2019 described below because they focus on our overall corporate strategy of balancing top-line revenue growth with profitability and prudent cost management. To learn more about why these measures were selected, see “Pay for Performance” on page 35. The threshold, target and maximum goals associated with each measure are established annually so that they remain rigorous and in line with our financial plan.

For purposes of the 2019 AIP, Income from Operations is defined as net income in accordance with GAAP but excluding the after-tax effects of the items detailed in Exhibit 2 on page E-5. This is one of the financial measures that management uses to assess our results. (To calculate Income from Operations per Share, the value of Income from Operations (as defined in Exhibit 2) was divided by the average diluted shares.) Management believes that excluding these items from net income better reflects the underlying trends in our businesses because the excluded items are unpredictable and not necessarily indicative of current operating fundamentals or future performance of the business segments. In addition, in most instances, decisions regarding these items do not necessarily relate to the operations of the individual segments.

For our CEO, performance is measured entirely at the corporate level, while our other NEOs are assessed on both corporate and business unit performance. To reflect the different roles and responsibilities of our NEOs, the Compensation Committee also weighs the performance measures differently for each NEO, as shown in the tables on pages 41 to 43.

Annual Cash Compensation for 2019 ▪ Compensation Discussion & Analysis

Performance Goals. In setting the goals for each of the performance measures, management and the Compensation Committee intended the target levels to be challenging yet achievable and the maximum levels to present a significant challenge, therefore requiring exceptionally strong performance to achieve these goals. The target goal for corporate Income from Operations per Share was set after consideration of a number of factors, including a review of our internal financial plan. The target goals for Business Unit Sales, at both the corporate and business-unit level, was based on our internal financial plan, emphasizing our corporate strategy to grow and protect the profitability of the business. The target goals for Controllable Costs were based upon controllable costs as budgeted in our annual financial plan. We believe that our methodology for determining financial performance targets for the AIP supports the following key objectives:

In establishing the performance goals for the 2019 AIP, the Compensation Committee took into account the sales environment across the business units over the previous year as well as the internal financial plan. The 2019 goals at target for Income from Operations per Share and Business Unit Sales were each increased for 2019 over the targets set for 2018. The target goals for Mr. Fuller for certain business unit-specific measures, including Annuities income from operations and Distribution net contribution margin, were decreased compared to the targets set for 2018. The goal for Annuities income from operations reflected the expected reduction in earnings resulting from the reinsurance of approximately $7.7 billion of annuities at the end of 2018, and the goal for Distribution net contribution margin reflected higher expenses due to investments made to expand our distribution network. The Compensation Committee believes these performance goals are rigorous goals at target that take into account both the risks and opportunities facing the Company.

In addition, for the 2019 AIP, the Committee also reviewed the weights for each goal and the goals for each role and made minor adjustments to Ms. Buckingham’s weightings to reflect an increase in her responsibilities during 2018.

2019 Performance Results and Actual Payouts

In February 2020, the Compensation Committee certified the performance results for the 2019 AIP. These formulaic results triggered a payout that was above target for all of our NEOs.

The following tables show the goals, weights, performance results and payout percentages for the 2019 AIP measures for each of our NEOs. Based on actual results, a payout percentage, expressed as a percentage of the NEO’s target payout opportunity, is first determined for each goal. These payouts are then weighted to determine the weighted payout for each goal. The sum of these weighted payouts equals the NEO’s payout percentage. The tables also show the resulting performance-based payouts approved by the Compensation Committee under the 2019 AIP for each of our NEOs and how these payouts compared with each NEO’s target payout opportunity under this program.

In calculating Operating ROE for the 2019 AIP, certain defined exclusions were made (as listed in Items A through I of Exhibit 2 on page E-5) in accordance with the terms of the plan, which resulted in the exclusion of the results of our third quarter 2019 annual assumption review. As a result, Income from Operations Per Share as calculated under the 2019 AIP was $8.70. The Compensation Committee can, at its discretion, reduce award payouts by including, rather than excluding, certain of the defined exclusions if it determines that these factors were relevant to individual performance. The Compensation Committee could have made other discretionary adjustments to the calculation of the performance results if the net effect would have been to reduce award amounts. In certifying the results for the 2019 AIP awards, the Compensation Committee did not exercise negative discretion for any of our NEOs and maintained the formulaic results.