Proxy Statement (definitive) (def 14a)

Date : 02/18/2020 @ 10:16PM
Source : Edgar (US Regulatory)
Stock : IQVIA Holdings Inc (IQV)
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Proxy Statement (definitive) (def 14a)

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934 (Amendment No. 1)

Filed by the Registrant        ☒

Filed by a Party other than the Registrant        ☐

Check the appropriate box:

☐          Preliminary Proxy Statement

☐          Confidential, for use of the Commission Only (as permitted by Rule 14a-6(e)(2))

☒          Definitive Proxy Statement

☐          Definitive Additional Materials

☐          Soliciting Material Pursuant to §240.14a-12

IQVIA HOLDINGS INC.

(Name of Registrant as Specified In Its Charter)

N/A

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

☒             No fee required.

☐             Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

  1)

Title of each class of securities to which transaction applies:

  

 

  2)

Aggregate number of securities to which transaction applies:

  

 

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Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on
which the filing fee is calculated and state how it was determined):

  

 

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Proposed maximum aggregate value of transaction:

  

 

  5)

Total fee paid:

  

 

☐             Fee paid previously with preliminary materials.

☐             Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the
offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its
filing.

 

  1)

Amount Previously Paid:

  

 

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Form, Schedule or Registration Statement No.:

  

 

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Filing Party:

  

 

  4)

Date Filed:

  

 


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February 18, 2020

 

 

 

IQVIA HOLDINGS INC.

83 Wooster Heights Road

Danbury, CT 06810

    

Dear Stockholder:

You are cordially invited to attend the 2020 Annual Meeting of Stockholders of IQVIA Holdings Inc. on Monday, April 6, 2020, at 9:00 am E.D.T. at the Ethan Allen Hotel, 21 Lake Avenue Extension, Danbury, Connecticut. The Notice of 2020 Annual Meeting of Stockholders and the Proxy Statement accompanying this letter describe the business to be conducted at the meeting and provide further information about IQVIA.

At IQVIA, we remain keenly focused on executing our strategy to advance healthcare treatment through leveraging unparalleled information, analytics, technology and knowledge assets. Every step we take in this journey brings us closer to our strategic purpose of improving patient outcomes. In the final year of our three-year merger integration program, IQVIA delivered strong operational and financial performance, as well as attractive returns to you, our shareholders.

2019 exceeded expectations. Reported revenue grew to $11.1 billion, representing 8.0 percent year-over-year constant currency growth. Our Technology and Analytics Solutions and Research and Development Solutions segments contributed significantly to our results, delivering 10.7 percent and 6.9 percent growth, respectively. Adjusted Diluted Earnings per Share of $6.39, increased 15.1 percent.

These strong results were driven by numerous operational achievements across our organization.

 

 

Our Technology Solutions business had a pivotal year, with Orchestrated Customer Engagement (OCE) gaining significant traction, earning deserved credibility in the market. We won 50 new OCE deals in 2019, compared to 30 in 2018, the first full year post-launch. To date, we have four top-15 pharmaceutical clients who have made the decision to adopt our superior platform.

 

 

In Real World, we continued to build on our position as the market thought leader, driving innovations such as the use of real world comparator arms to eliminate the need for a placebo group. The team continues to invest in our rich clinical data assets, which now stands at 800 million non-identified patients globally.

 

 

The Research and Development Solutions team won business with over 250 new clients during the year. Importantly, we formed two preferred provider agreements with top 15 pharmaceutical clients. Our “see more, win more” strategy is working. We are clearly seeing more and winning more trials as sponsors come to realize the benefit of our highly differentiated capabilities. Our Research and Development Solutions backlog at December 31, 2019 reached a record $19 billion.

 

 

Contract Sales and Medical Solutions continued its turnaround in 2019. A new regionalized go-to-market approach, combined with a differentiated offering, drove new wins in the market and returned this business to growth.

 

 

We were named to FORTUNE’s list of World’s Most Admired Companies, recognized as one of America’s Best Employers for Women by Forbes, awarded Best Contract Research Organization Full-service Provider by Scrip Awards, and selected as the leader in Real World Data and Real World Evidence Services in a 2019 Life Science Strategy Group report.

We maintain a strong balance sheet, flexible capital structure and attractive free cash flow profile that enables investments to further drive innovation and the continued return of cash to shareholders. During 2019, we completed a number of tuck-in acquisitions to further expand our technology platform and invested a further $582 million in internal development, mainly in software development and our technology infrastructure. We also returned $945 million to shareholders through the repurchase of 6.6 million shares.

Our company remains uniquely positioned to address some of healthcare’s most complex challenges. We will continue to invest and innovate to advance patient outcomes and deliver value to our shareholders.

Ari Bousbib

Chairman and Chief Executive Officer


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IQVIA 2020 PROXY STATEMENT        

 

 

 

Notice of 2020 Annual Meeting

of Stockholders

 

2020 ANNUAL MEETING INFORMATION

Time and Date:

9:00 a.m. E.D.T.,

Monday, April 6, 2020

Place:

Ethan Allen Hotel

21 Lake Avenue Extension

Danbury, Connecticut

Record Date:

February 12, 2020

Important Notice Regarding the Availability of Proxy Materials for the 2020 Annual Meeting of Stockholders to Be Held April 6, 2020:

Our Notice of Meeting, Proxy Statement, Form of Proxy Card and 2019 Annual Report are available at: https://materials.proxyvote.com/46266C

 

YOUR VOTE IS IMPORTANT

To make sure your shares are represented, please cast your vote as soon as possible in one of the following ways:

 

   

INTERNET

 

Go to the website shown on your proxy card and related instructions

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TELEPHONE

 

Use the toll-free number shown on your proxy card or voting instruction form

  LOGO
 
   

Mail

 

Mark, sign and date your proxy card and return it in the postage-paid envelope

  LOGO

AGENDA

 

  Proposal 1: Election of three Class I director nominees named in the accompanying Proxy Statement for a three-year term

 

  Proposal 2: Advisory (non-binding) vote to approve executive compensation (say-on-pay)

 

  Proposal 3: Ratification of our Audit Committee’s appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for 2020

 

  Other business, if properly raised

The Board of Directors recommends that you vote “FOR” each director nominee included in Proposal 1 and “FOR” each of the other proposals. The full text of these proposals is set forth in the accompanying Proxy Statement. Registered stockholders of the Company at the close of business on the record date are eligible to vote at the meeting.

We recommend that you review the information on the process for, and deadlines applicable to, voting, attending the meeting and appointing a proxy under “About the 2020 Annual Meeting” on page 90 of the Proxy Statement.

By Order of the Board of Directors,

 

LOGO

Eric M. Sherbet

Executive Vice President,

General Counsel and Secretary

February 18, 2020

Danbury, Connecticut

 


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IQVIA 2020 PROXY STATEMENT      |  i

 

 

 

Table of Contents

 

1   Proxy Statement Summary
     

 

11

 

 

Proposal No.  1: Election of Directors

12   Board Composition
14   Board of Directors
     

 

21

 

 

IQVIA’s Corporate Governance

21   Documents Establishing our Corporate Governance
22  

Corporate Governance Practices

23   Leadership Structure
24   Board Structure
24   Director Independence
25   Committees of the Board
29   Board’s Role in Risk Oversight
29   Succession Planning for Directors and Executive Officers
30   How to Contact the Board and its Committees
31   Sustainability and Corporate Citizenship
34   Stockholder Engagement
     

 

36

 

 

Director Compensation

36   Non-Employee Director Compensation Program
37   2019 Director Compensation
     

 

39

 

 

Proposal No 2: Non-Binding Vote on Executive Compensation

     

 

40

 

 

Compensation Discussion and Analysis

41   Strong Performance
43   Sound Pay Practices
43   Compensation Philosophy
44   Overview of our Executive Compensation Program
46   Elements of Compensation
50   Retirement, Perquisites and Termination Benefits
52   Disciplined Assessment to Determine Pay
52   2019 Named Executive Officers
52   2019 Compensation Determinations
52   2019 Amendment to Chief Executive Officer’s Employment Agreement
53   2019 Base Salary
53   2019 Short-Term Incentive Awards
61   2019 Long-Term Incentive Awards
62  

Perquisites

63  

Pay is Aligned with Performance

64   Rigorous Accountability, Risk-Mitigation and Recovery Provisions
65   Risk Assessment
65   Tax Deductibility
     

 

66

 

 

Compensation Committee Report

     

 

67

 

 

Compensation of Named Executive Officers

67   2019 Summary Compensation Table
68   2019 All Other Compensation
69   2019 Grants of Plan-Based Awards
72   Outstanding Equity Awards at Fiscal Year-End for 2019
74   2019 Option Exercises and Stock Vested
75   2019 Pension Benefits
76   Defined Benefit Retirement Plans
77   2019 Non-Qualified Deferred Compensation
78   Potential Payments upon Termination or Change in Control
81   CEO Pay Ratio
     

 

82

 

 

Proposal No. 3: Ratification of the Appointment of the Independent Registered Public Accounting Firm

     

 

83

 

 

Audit

83   Audit Committee Report
84   Fees Paid to Independent Registered Public Accounting Firm
     

 

85

 

 

Security Ownership of Certain Beneficial Owners and Management

     

 

88

 

 

Certain Relationships and Related Person Transactions

88   Related Party Transactions Approval Policy
88  

Shareholders Agreement

89  

Corporate Opportunities

     

 

90

 

 

About the 2020 Annual Meeting

     

 

95

 

 

Other Relevant Information

95   Compensation Committee Interlocks and Insider Participation
95   Other Matters
95   Stockholder Proposals and Nominees for 2021 Annual Meeting of Stockholders
96   Incorporation by Reference
96   Solicitation of Proxies
96   Reduce Mailings
96   Cautionary Note Regarding Forward-Looking Statements
     

 

98

 

 

Appendix A  –Financial Reconciliations

 


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IQVIA 2020 PROXY STATEMENT      |   1

 

 

 

Proxy

Statement Summary

  

This Proxy Statement Summary highlights information contained elsewhere in this Proxy Statement, which is first being sent or made available to stockholders on or about February 18, 2020. This summary does not contain all of the information you should consider, so please read the entire Proxy Statement carefully before voting.

MATTERS TO BE VOTED UPON

The following table summarizes the proposals to be voted upon at the 2020 Annual Meeting of Stockholders of IQVIA Holdings Inc. (“IQVIA”, the “Company”, “we” or “our”) to be held on April 6, 2020 (the “2020 Annual Meeting”) and voting recommendations of the Board of Directors of the Company (the “Board”) with respect to each proposal.

 

Proposals    Required Approval    Board
Recommendation
   Page
Reference
Election of Directors    Plurality of votes cast    FOR    11
Advisory vote to approve executive compensation (say-on-pay)    Not applicable1    FOR    39
Ratification of independent auditor    Majority of votes cast    FOR    82

 

1 

Because this is an advisory vote, there is no required approval.

COMPANY OVERVIEW

IQVIA is a leading global provider of advanced analytics, technology solutions and contract research services to the life sciences industry. Powered by the IQVIA CORE, we deliver unique and actionable insights to help biotech, medical device, and pharmaceutical companies, medical researchers, government agencies, payers and other healthcare stakeholders tap into a deeper understanding of diseases, human behaviors and scientific advances, in an effort to advance their path toward cures. With approximately 67,000 employees, we conduct operations in more than 100 countries.

We have one of the largest and most comprehensive collections of healthcare information in the world, which includes more than 800 million comprehensive, longitudinal, non-identified patient records spanning sales, prescriptions, promotions, medical claims, electronic medical records, genomics, and social media. We standardize, curate, structure and integrate this data by applying our sophisticated analytics and leveraging our global technology infrastructure. This helps our clients run their organizations more efficiently and make better decisions to improve their clinical, commercial and financial performance.

We are a global leader in protecting individual patient privacy. We use a wide variety of privacy-enhancing technologies and safeguards to protect individual privacy while generating and analyzing information on a scale that helps healthcare stakeholders identify disease patterns and correlate with the precise treatment path and therapy needed for better outcomes.


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2   |  Proxy Statement Summary   IQVIA 2020 PROXY STATEMENT

 

 

 

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OUR STRATEGY AND PURPOSE

We believe we are well positioned for continued growth across the markets we serve. Our strategy for achieving growth includes:

 

 

 

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Continuing to innovate by leveraging our information, advanced analytics, transformative technology and significant domain expertise

 

 

 

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Building upon our extensive client relationships

 

 

 

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Improving patient outcomes by accelerating healthcare stakeholders’ efforts to value and deliver treatments to patients

 

 

 

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Expanding the penetration of our offerings to the broader healthcare marketplace

 

 

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Expanding our portfolio through effective capital deployment, including strategic tuck-in acquisitions

 


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IQVIA 2020 PROXY STATEMENT    Proxy Statement Summary  |   3

 

 

 

FINANCIAL HIGHLIGHTS

 

 

 

    2019 Key Financial Metrics

 

  

 

Year-over-Year Growth

 

               Revenue

    $11.1Bn

  

    6.5%

              Adjusted EBITDA1

    $2.4Bn

  

    7.9%

              Adjusted Diluted EPS1

    $6.39

 

  

    15.1%

 

  

Total Stockholder

Return

 

  

    33%

 

    2019 Capital Deployment

 

   
             
      

Cash Repatriation

$1.1Bn

 

   

Cash Returned to Stockholders via Repurchases

$945M

 

               
 

 

Investments in Product Development and Technology

$582M

 

   

Investments in Acquisitions

$588M

 

 

 

    2019 Business Highlights

 

   
             
      

 

Clinical Development Net Book-to Bill Ratio

1.34x

 

        

 

Clinical Development Contracted Backlog

$19Bn

 

               
 

 

Clinical Development Customers

250+

R&D Solutions contracted business with over 250 new customers, including 13 of the top 20 pharmaceutical companies using CORE-powered smart trials

 

   

 

New OCE Technology Customer Wins

50

Versus 30 in 2018, the first full year since product launch

 

 

1 

See reconciliation of non-GAAP items in the Appendix


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4   |  Proxy Statement Summary   IQVIA 2020 PROXY STATEMENT

 

 

 

   

Merger Integration Highlights

 

At the time of the Merger (as defined herein), we set the following goals:

 

  Accelerate clinical development to help bring drugs to market faster and more efficiently

 

  Integrate legacy company capabilities in the evolving real world evidence space

 

  Leverage technology across the organization to further differentiate our combined offerings

 

We also made a commitment to accelerate revenue growth by 100 to 200 basis points exiting 2019.

 

LOGO

 

Entering 2019, the final year of our three-year Merger integration period, we delivered on our commitment of accelerated top line growth, with total revenue growth accelerating by over 200 basis points in 2019, compared to 2018.

 

We also made significant progress leveraging technology across the organization. In December 2017, the Orchestrated Customer Engagement (“OCE”) SaaS platform was launched. OCE is a disruptive technology and is highly differentiated compared to the current point solutions that exist in the market. It is not a traditional Customer Relationship Management (“CRM”) tool. Built on Salesforce’s Force.com and Marketing Cloud, as well as other best-in-class platforms, OCE is a collaborative tool that utilizes artificial intelligence and machine learning to integrate the various functions within our life sciences client’s commercial operations. At December 31, 2019, we had 80 clients deploying OCE globally.

 

In addition to OCE, we invested in many other technologies, including:

 

  further development of E360, a proven SaaS platform to access and drive scalable and global analytics on complex Real World Data

 

  the launch of E360 Genomics

 

  the launch of virtual trials, also platformed on Salesforce, a transformative technology that brings clinical research directly to patients and ultimately increases trial participation as we help clients reach diverse and difficult to recruit patients

 

  clinical and commercial content management tools

 

  regulatory, pharmacovigilance and many others


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IQVIA 2020 PROXY STATEMENT    Proxy Statement Summary  |   5

 

 

 

At the time of the Merger, we also set out to integrate the operations of both legacy organizations, committing to run-rate cost savings of $200 million exiting 2019, a goal that we achieved earlier than expected in 2019.

 

LOGO

 

     Merger Integration Period Capital Deployment

 

      

Cash Repatriation

$3.4Bn

 

   

Cash Returned to Stockholders via Repurchases

$6.0Bn

 

               
 

 

Investments in Product Development and Technology

$1.5Bn

 

 

   

Investments in Acquisitions

$1.9Bn

 


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6   |  Proxy Statement Summary   IQVIA 2020 PROXY STATEMENT

 

 

 

      

 

Historical Financial Performance

 

 

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1 

Dollar values in millions

2 

Growth rates are at actual foreign currency exchange rates

3 

See reconciliation of non-GAAP items in the Appendix

 

Historical Financial Performance

 

Total Stockholder Return Since Merger Announcement (May 3, 2016 to December 31, 2019)

 

   LOGO

 

(1)

Peer group consists of Cerner Corporation, Charles River Laboratories, Inc., Equifax Inc., ICON plc, IHS Markit Ltd., Laboratory Corporation of America Holdings, Nielsen N.V., PRA Health Sciences, Inc., Syneos Health, Inc., Thomson Reuters Corporation and Verisk Analytics, Inc.

This performance graph shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or incorporated by reference into any filing of IQVIA Holdings Inc. under the Exchange Act or under the Securities Act of 1933, as amended (the “Securities Act”), except as shall be expressly set forth by specific reference in such filing.


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IQVIA 2020 PROXY STATEMENT    Proxy Statement Summary  |   7

 

 

 

CORPORATE GOVERNANCE HIGHLIGHTS

We have a history of strong corporate governance. We believe good governance is critical to achieving long-term stockholder value creation. We are committed to governance practices and policies that serve the long-term interests of the Company and its stockholders. The following table summarizes certain highlights of our corporate governance practices and policies:

 

 

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Each share of our common stock outstanding on the record date is entitled to one vote per matter presented to stockholders

 

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Securities Trading Policy, including Anti-Hedging and Anti-Pledging terms

 

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Regular Board and Committee Executive Sessions of Non-Management Directors

 

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Risk Oversight by the Board and Committees

 

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Multi-Year Vesting Requirements for Performance Share Awards

 

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Annual Board and Committee Self Assessments

 

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All directors except our Chief Executive Officer are independent

 

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Audit Committee Approval Required for Related Party Transactions

 

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Share Ownership Guidelines for both Directors and Key Executives

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Comprehensive Whistleblower Policy in place

 

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Adopted a proxy access bylaw

 

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Lead Director, elected by the independent directors

 

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Consider a broad range of diverse director candidates, including with respect to gender, race and ethnicity

 

 

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Director Resignation Policy whereby directors are required to tender their resignation if they receive a number of withhold votes that is greater than 50% of all votes cast

 

 

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Enhanced proxy statement disclosure on board composition, stockholder engagement and sustainability and corporate citizenship matters, among other enhancements

 

 

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No “Poison Pill” (Stockholder Rights Plan)

 

 

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No Excise Tax Gross-Ups on Severance or Change in Control Payments or Benefits

 
 


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8   |  Proxy Statement Summary   IQVIA 2020 PROXY STATEMENT

 

 

 

COMPENSATION PRACTICES

The Leadership Development and Compensation (“LDC”) Committee of the Board oversees the design and administration of our compensation programs. The executive compensation program is designed and administered in a manner that appropriately manages risk to safeguard the interests of our stockholders, as well as our employees. The following table summarizes key highlights of our compensation practices that drive our named executive compensation program:

 

WHAT WE DO

 

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Align executive pay with performance

 

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Set challenging performance objectives for our named executive officers

 

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Appropriately balance short- and long-term incentives

 

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Align executive compensation with stockholder returns through performance-based long-term incentive awards

 

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Use multi-year vesting requirements for long-term awards

 

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Implement meaningful share ownership guidelines

 

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Annual named executive officer performance evaluation by the LDC Committee

 

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Robust clawback policy in place for our cash and equity incentive compensation for financial restatements

 

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Include non-solicitation and non-competition provisions in awards agreements

 

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Conduct an annual compensation risk review and assessment

 

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Utilize expertise of an independent compensation consultant

 

 

WHAT WE DON’T DO

 

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No contracts with multi-year guaranteed salary increases or non-performance bonus arrangements

 

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No excise tax gross-ups

 

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No single trigger equity vesting

 

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No repricing of underwater stock options or SARs without stockholder approval

 

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No payment of unearned dividends prior to vesting

 

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No hedging or pledging of Company shares

 


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IQVIA 2020 PROXY STATEMENT    Proxy Statement Summary  |   9

 

 

 

SAY-ON-PAY

 

     LOGO        

 

Stockholders showed strong support of our executive compensation program in our last “say-on-pay” vote at our 2017 annual meeting of stockholders, which our stockholders previously approved to hold every three years, with approximately 88% of votes cast in favor of the proposal. See Proposal No. 2: Non-Binding Vote on Executive Compensation on page 39 for further details on this year’s say-on-pay vote.

 

 

2019 COMPENSATION MIX

Our executive compensation program is focused on creating an alignment between executive compensation and business performance by rewarding our executive officers for the achievement of strategic goals that are intended to contribute to long-term stockholder value. We emphasize performance-based, variable compensation over fixed compensation. The following charts reflect the mix of pay for our Chief Executive Officer (86.8% performance-linked) and the average for our other executive officers who are listed in the “Summary Compensation Table” below and the other compensation tables included in this Proxy Statement (collectively, our “named executive officers”) as a group (74.5% performance-linked):

 

Chief Executive Officer

 

  

Average of other Named Executive Officers

 

LOGO    LOGO


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PAY-FOR-PERFORMANCE

The LDC Committee believes that our executive compensation program should align the interests of stockholders and management by providing a strong alignment between executive compensation and total stockholder return. The graph below shows the relative alignment of our Chief Executive Officer’s (including his predecessor’s compensation from January 1, 2016 until the closing of the Merger on October 3, 2016) historic pay against performance with respect to total stockholder return over the three-year period ended December 31, 2018 against a peer group determined by one of the leading proxy advisory firms. The three-year period ended December 31, 2018 is the latest period for which information is publicly available from the peer group.

Our Chief Executive Officer’s compensation during the three-year period ended December 31, 2018 included a special retention grant of restricted stock provided by the LDC Committee following the Merger that vests over a four-year period. The LDC Committee granted the award to our Chief Executive Officer to further incentivize his continued engagement and long-term commitment to our business and to recognize that our Chief Executive Officer, post-Merger, assumed responsibility for a much larger and more complex organization. When deciding the terms of this special retention grant, the LDC Committee considered the fact that approximately 90% of the value associated with the outstanding equity awards held by our Chief Executive Officer as of January 2017 would be fully vested or exercisable within approximately 12 months, making it much easier for a competitor to recruit our Chief Executive Officer and providing him with less of a financial incentive to stay in the face of a potential higher offer from another company. For the three-year period ended December 31, 2018, our performance with respect to total stockholder return was in the 88th percentile and the total compensation, including the special retention equity grant, for our Chief Executive Officer was in the 88th percentile, which indicates that our Chief Executive Officer’s pay and our performance are strongly aligned. Excluding our Chief Executive Officer’s special retention equity grant in 2017, his total compensation was in the 69th percentile.

For details of our Chief Executive Officer’s 2019 compensation, see “Compensation of Named Executive Officers”.

Alignment of Historic CEO Pay

January 1, 2016 - December 31, 2018

 

LOGO

 

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IQVIA (incudes 2017 Retention Grant)

LOGO

IQVIA (excludes 2017 Retention Grant)

LOGO

Peer Companies include Agilent Technologies, Inc., Automatic Data Processing, Inc., Bausch Health Companies Inc., Cognizant Technology Solutions Corp., DaVita, Inc., DXC Technology Co., IHS Markit Ltd., Laboratory Corp of America Holdings, Leidos Holdings, Inc., ManpowerGroup, Inc., Mylan NV, Nielsen Holdings PLC, Perrigo Co. Plc, Quest Diagnostics, Inc., Syneos Health, Inc., and Thermo Fisher Scientific, Inc.


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IQVIA 2020 PROXY STATEMENT      |   11

 

 

 

Proposal No. 1: Election of Directors

 

Our Certificate of Incorporation provides for a board of directors divided into three classes, designated Class I, Class II and Class III. Each year, a different class of directors is elected at our annual meeting of stockholders and each elected director holds office for a 3-year term or until his or her successor is duly elected or until his or her earlier death, resignation, retirement, disqualification or removal.

 

This year, Class I directors

Carol J. Burt

Colleen A. Goggins

Ronald A. Rittenmeyer

will stand for election for a new term.

As Jonathan J. Coslet and Michael J. Evanisko, both Class I directors, will not stand for reelection at the 2020 Annual Meeting, the Board decided to rebalance the director classes. As a result, Colleen A. Goggins, who was serving as a Class II director, and Carol J. Burt, who was serving as a Class III director, will each stand for election this year as a Class I director. Following our 2020 Annual Meeting, assuming each director nominee is elected to a new term by the stockholders, the Board will consist of nine (9) directors, divided into the following three classes:

 

Class    Directors   

Year 

Term Expires 

 

Class I

  

 

Carol J. Burt

Colleen A. Goggins

Ronald A. Rittenmeyer

  

 

2023       

 

Class II

  

 

Ari Bousbib

John M. Leonard, M.D.

Todd B. Sisitsky

  

 

2021       

 

Class III

  

 

John P. Connaughton

John G. Danhakl

James A. Fasano

  

 

2022       

Consistent with the requirements of our governance documents and upon the recommendation of the Nominating and Governance Committee, the Board has nominated Carol J. Burt, Colleen A. Goggins and Ronald A. Rittenmeyer for election for a new term as a Class I director at the 2020 Annual Meeting. If elected to a new term at the 2020 Annual Meeting, each Class I director nominee will be elected for a term of three years and serve until his or her successor is duly elected and qualified or until his or her earlier death, resignation, retirement, disqualification or removal.

The Board believes that each of the nominees has a record of integrity, a strong professional reputation and a record of entrepreneurial or managerial achievement. The specific experience, qualifications, attributes and skills of each nominee that led the Board to conclude that the individual should serve as a director are described in each nominee’s biography below.

Shares represented by executed proxies will be voted, if authority to do so is not withheld, for the election of the three nominees named above. In the event that any nominee should be unavailable for election as a result of an unexpected occurrence, and the Board does not, in that event, choose to reduce the size of the Board, such shares will be voted for the election of such substitute nominee as the Board may propose. Each person nominated for election has agreed to serve if elected, and management has no reason to believe that any nominee will be unable to serve. Directors are elected by a plurality of the votes cast at the 2020 Annual Meeting.

 

 

 

 

   LOGO   

  

 

 

THE BOARD RECOMMENDS A VOTE “FOR” THE ELECTION OF
EACH NAMED NOMINEE

 


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12   |  Proposal No. 1   IQVIA 2020 PROXY STATEMENT

 

 

 

The following table sets forth, for the Class I director nominees and each person whose term of office as a director will continue in office after the 2020 Annual Meeting, certain information about them, including their ages as of the date of this Proxy Statement:

 

  Name   Age   Position Held with the Company   Audit(1)     N&G(2)     LDC(3)     Director
Since
 

  Class I Directors to be elected to terms that will expire at the 2023 Annual Meeting of Stockholders

 

  Carol J. Burt

 

62

 

Director

 

 

X

 

                 

 

2019

 

  Colleen A. Goggins

 

65

 

Director

 

 

X

 

 

 

X

 

         

 

2017

 

  Ronald A. Rittenmeyer

 

71

 

Director

 

 

X

 

   

 

Chair

 

 

 

2016

 

  Class II Directors whose terms expire at the 2021 Annual Meeting of Stockholders

 

  Ari Bousbib

 

58

 

Chairman and Chief Executive Officer

                         

 

2016

 

  John M. Leonard, M.D.

 

62

 

Lead Director

 

 

X

 

 

 

X

 

         

 

2015

 

  Todd B. Sisitsky

 

48

 

Director

   

 

Chair

 

 

 

X

 

 

 

2016

 

  Class III Directors whose terms expire at the 2022 Annual Meeting of Stockholders

 

  John P. Connaughton

 

54

 

Director

                 

 

X

 

 

 

2008

 

  John G. Danhakl

 

63

 

Director

         

 

X

 

 

 

X

 

 

 

2016

 

  James A. Fasano

 

49

 

Director

 

 

Chair

 

                 

 

2016

 

 

(1)

Member of the Audit Committee of the Board

(2)

Member of the Nominating and Governance Committee of the Board

(3)

Member of the LDC Committee of the Board

BOARD COMPOSITION

Diversity and Tenure. Consistent with our Corporate Governance Guidelines, the Board seeks a mix of directors that enhances the diversity of backgrounds, skills and experiences on the Board, including with respect to professional skills, relevant industry expertise, specialized experience, international experience, age, gender, race and ethnicity. The Board believes that considering diversity in our Board composition is consistent with the goal of creating a Board that best serves the needs of the Company and the interests of its stockholders, and it is one of the many factors considered when identifying individuals for Board service.


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Since the Merger in 2016, and as the director nomination requirements of the Shareholders Agreement (as defined herein) have fallen away, the Board has been focused on refreshing the composition of the Board in order to ensure the appropriate mix of backgrounds, skills and experiences in light of the Company’s post-Merger strategy and to enhance the diversity of the Board. Since the Merger, two directors have retired from the Board and two directors, who are both women, have joined the Board. The Board expects to continue to seek new directors who will further enhance the mix of experiences and backgrounds of the current Board. The following statistics highlight the diversity of the composition of our Board following the 2020 Annual Meeting.

 

Gender

 

    

Age Distribution

    

Significant Board Refreshment

         

LOGO       

 

 

*  100% of new director appointments since the Merger have been female directors

    

59

  

Average Age

of Directors

48-71 – Age Range

    

8

  

New Directors

over Past 5 Years

Qualifications and experience of directors. We believe our directors bring a well-rounded variety of experiences, qualifications, attributes and skills, and represent a mix of deep knowledge of the Company and fresh perspectives. As we review our long-term strategy, we continually assess the skills of our directors in evaluating what current and future skills and experiences will be required and weigh those skills when evaluating our current directors as well as potential director candidates. The table below summarizes certain of the key experiences, qualifications and core competencies of our directors.

 

Skill1                                                                                     Total of 9
                                

LOGO

 

  

Senior Leadership Experience

 

                                                                                                               9
                                                                                            
                                

LOGO

  

Public Company Board Experience

 

                              6
                                                                                            
                                

LOGO

  

Healthcare Industry Experience

 

                              9
                                                                                            
                                

LOGO

  

Technology Industry Experience

 

                              4
                                                                                            
                                

LOGO

  

Financial Expertise

 

                              7
                                                                                            
                                

LOGO

  

Global Experience

 

                              8
                                                                                            
1 

This high-level summary is not intended to be an exhaustive list of each of our directors’ skills or contributions to the Board.


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BOARD OF DIRECTORS

Set forth below is biographical information for the Class I director nominees and each person whose term of office as a director will continue after the 2020 Annual Meeting.

Class I Director for Election to a Three-Year Term Expiring at the 2023 Annual Meeting of Stockholders

CAROL J. BURT

LOGO

 

Director Since 2019

 

Independent

 

62 years old

 

Audit Committee (Member)

 

Audit Committee Financial Expert             

 


Experience:

Burt-Hilliard Investments (2008-present)

  Principal

 

Consonance Capital Partners (2013-present)

  Senior Advisor

  Member, Operating Council

 

WellPoint, Inc. (now Anthem, Inc.) (1997-2007)

  SVP Corporate Finance and Development

 

Chase Securities (now J.P. Morgan) (1981-1996)

  Managing Director and Head of the Healthcare Group (1992-1996)

 

Other U.S. public company directorships:

  ResMed Inc. (Audit Committee and Compliance Oversight Committee)

 

Former U.S. public company directorships held in the past five years:

  Envision Healthcare Corporation

  WellCare Health Plans, Inc.

 

Other positions:

  Member, Board of Directors, WellDyneRx, LLC; Global Medical Response Inc.

  Member, Women Corporate Directors

  Chair, Board of Directors, Colorado Chapter of The Nature Conservancy

 

Education:

  Bachelor of Arts in Business Administration, the University of Houston

 

 

  Specific Experience: Because of her leadership experience and over 35 years of business experience in the health insurance, healthcare services and financial services industries and her experience serving on public company boards, we believe Ms. Burt is well qualified to serve on the Board.


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COLLEEN A. GOGGINS

LOGO

 

Director Since 2017

 

Independent

 

65 years old

 

Audit Committee (Member)

 

Nominating and Governance
Committee
(Member)

 

Audit Committee Financial Expert             

 


Experience:

Johnson & Johnson (1981-2011)

  Member, Executive Committee (2001-2011)

  Worldwide Chairman, Consumer Group (2001-2011)

  Company Group Chairman, North America (1998-2001)

  President Consumer Products US (1995-1998)

 

Other U.S. public company directorships:

  The Toronto-Dominion Bank (Risk Committee)

 

Former U.S. public company directorships held in the past five years:

  Bausch Health Companies Inc. (f/k/a Valeant Pharmaceuticals International)

 

Other positions:

  Member, Board of Directors, SIG Combibloc Group; Citymeals-on-Wheels New York City; University of Wisconsin Center for Brand and Product Management

  Member, Supervisory Board, Bayer AG

  Member, University of Wisconsin Foundation

  Member, Board of Trustees, Institute of International Education

 

Education:

  Master of Arts in Management, Kellogg School of Management

  Bachelor of Science in Food Chemistry, University of Wisconsin-Madison

 

 

  Specific Experience: Because of Ms. Goggins’s extensive leadership and healthcare experience, we believe Ms. Goggins is well qualified to serve on the Board. Ms. Goggins was designated for nomination to the Board pursuant to the Shareholders Agreement described herein. The designation provisions in the Shareholders Agreement under which Ms. Goggins was designated to the Board terminated in 2018.


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RONALD A. RITTENMEYER

LOGO

 

Director Since 2016

 

Independent

 

71 years old

 

Audit Committee (Member)

 

LDC Committee (Chair)

 

Audit Committee Financial Expert             

 


Experience:

Tenet Healthcare Corporation (2017-present)

  Executive Chairman and Chief Executive Officer

 

Millennium Health (2016-2017)

  Chairman and Chief Executive Officer

 

Electronic Data Systems Corporation (2005-2008)

  Chairman and Chief Executive Officer (2007-2008)

  President (2006-2007)

  Chief Operating Officer (2005-2007)

  Executive Vice President, Global Service Delivery (2005-2006)

 

Other U.S. public company directorships:

  Tenet Healthcare Corporation

 

Former U.S. public company directorships held in the past five years:

  American International Group, Inc.

  IMS Health (predecessor to IQVIA)

  Millennium Health

 

Education:

  Master of Business Administration, Rockhurst University

  Bachelor of Arts in Commerce and Economics (Finance), Wilkes University

 

 

  Specific Experience: Because of his leadership experience, over 30 years of business experience and extensive experience serving on public company boards, we believe Mr. Rittenmeyer is well qualified to serve on the Board. For his current term expiring at the 2020 Annual Meeting, Mr. Rittenmeyer was designated for nomination to the Board pursuant to the Shareholders Agreement described herein. The designation provisions in the Shareholders Agreement under which Mr. Rittenmeyer was designated to the Board terminated in 2018.


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Class II Directors Continuing in Office until the 2021 Annual Meeting of Stockholders
ARI BOUSBIB

LOGO

 

Director Since 2016                                             

 

Chairman and CEO

 

58 years old

 


Experience:

IQVIA Holdings Inc. (2010-present)

  Chairman and Chief Executive Officer (2016-present)

  Chairman and Chief Executive Officer of IMS Health (2010-2016)

 

United Technologies Corporation (1997-2010)

  President of UTC’s commercial companies (Otis Elevator Company, Carrier Corporation, UTC Fire & Security and UTC Power Inc.) (2008-2010)

  President, Otis Elevator Company (2002-2008)

  Chief Operating Officer, Otis Elevator Company (2000-2002)

 

Other U.S. public company directorships:

  The Home Depot, Inc. (Finance Committee and Audit Committee)

 

Former U.S. public company directorships held in the past five years:

  IMS Health (predecessor to IQVIA)

 

Other positions:

  Member, Harvard Medical School Health Care Policy Advisory Council

 

Education:

  Master of Business Administration, Columbia University

  Master of Science in Mathematics and Mechanical Engineering, Ecole Superieure des Travaux Publics, Paris

 

 

  Specific Experience: Because of Mr. Bousbib’s extensive leadership experience and service as our Chief Executive Officer, we believe Mr. Bousbib is well qualified to serve on the Board. Mr. Bousbib was designated for nomination to the Board pursuant to the Shareholders Agreement described herein. The designation provisions in the Shareholders Agreement under which Mr. Bousbib was designated to the Board terminated in 2018.


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JOHN M. LEONARD, M.D.

LOGO

 

Director Since 2015

 

Independent

 

Lead Director

 

62 years old

 

Audit Committee (Member)

 

Nominating and Governance
Committee
(Member)

 

Audit Committee Financial Expert             

 


Experience:

Intellia Therapeutics, Inc. (2018-present)

  Director, President and Chief Executive Officer

 

AbbVie Inc. (January 2013-December 2013)

  Chief Scientific Officer and Senior Vice President of Research and Development

 

Abbott Laboratories (1992-2012)

  Senior Vice President of Global Pharmaceutical Research and Development (2008-2012)

 

Other U.S. public company directorships:

  Intellia Therapeutics, Inc.

 

Education:

  Doctorate in Medicine, Johns Hopkins University

  Bachelor of Arts in Biochemistry, University of Wisconsin-Madison

 

 

Specific Experience: Because of his leadership experience, including his over 30 years’ experience in medicine, research and management, we believe Dr. Leonard is well qualified to serve on the Board. Dr. Leonard was designated for nomination to the Board pursuant to the Shareholders Agreement described herein. The designation provisions in the Shareholders Agreement under which Dr. Leonard was designated to the Board terminated in 2018.

TODD B. SISITSKY

LOGO

 

Director Since 2016

 

Independent

 

48 years old

 

LDC Committee (Member)

 

Nominating and Governance
Committee
(Chair)

 


Experience:

TPG Capital (2003-present)

  Co-Managing Partner

 

Other U.S. public company directorships:

  Allogene Therapeutics, Inc. (Audit Committee, Nominating and Corporate Governance Committee)

 

Former U.S. public company directorships held in the past five years:

  Endo International plc

  IASIS Healthcare LLC

  IMS Health (predecessor to IQVIA)

 

Other positions:

  Chair, Board of Advisors, Dartmouth Medical School

  Member, Board of Directors, Convey Health Solutions, Inc.; Adare Pharmaceuticals, Inc.; Immucor Inc.

 

Education:

  Master of Business Administration, Stanford Graduate School of Business

  Bachelor of Arts, Dartmouth College

 

 

 

Specific Experience: Because of his extensive experience in leadership, business and healthcare, we believe Mr. Sisitsky is well qualified to serve on the Board. Mr. Sisitsky was designated for nomination to the Board by TPG pursuant to the Shareholders Agreement described herein. TPG’s designation rights under the Shareholders Agreement ceased in 2019.

 


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Class III Directors Continuing in Office until the 2022 Annual Meeting of Stockholders
JOHN P. CONNAUGHTON

 


LOGO

 

Director Since 2008

 

Independent

 

54 years old

 

LDC Committee (Member)

 


Experience:

Bain Capital (1989-present)

  Co-Managing Partner

 

Former U.S. public company directorships held in the past five years:

  iHeartMedia, Inc.

 

Other positions:

  Member, Board of Directors, The Boston Celtics

  Member, Board of Trustees, The Berklee College of Music; University of Virginia McIntire Foundation

 

Education:

  Master of Business Administration, Harvard Business School

  Bachelor of Science in Commerce, University of Virginia

 

  Specific Experience: Because of his extensive experience as a Managing Director of Bain Capital, service on other public company boards and over 15 years’ experience in the private equity industry, as well as extensive experience in the healthcare industry, we believe Mr. Connaughton is well qualified to serve on the Board.
JOHN G. DANHAKL

 


LOGO

 

Director Since 2016

 

Independent

 

63 years old

 

LDC Committee (Member)

 

Nominating and Governance                         
Committee
(Member)

 


Experience:

Leonard Green & Partners, L.P. (1995-present)

  Managing Partner

 

Former U.S. public company directorships held in the past five years:

  IMS Health (predecessor to IQVIA)

 

Other positions:

  Member, Board of Directors: Life Time Fitness, Inc.; Advantage Solutions Inc.; Charter NEX; Global Citizen CPA Global; Genani Corporation; Insight Global, Inc.; Mister Car Wash Holdings, Inc.; MultiPlan, Inc.; Savers, Inc.; SRS Distribution

 

Education:

  Master of Business Administration, Harvard Business School

  Bachelor of Arts in Economics, University of California at Berkeley

 

  Specific Experience: Because of his extensive experience serving as a public company director and his extensive experience in leadership and business, we believe Mr. Danhakl is well qualified to serve on the Board.


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JAMES A. FASANO

LOGO

 

Director Since 2016

 

Independent

 

49 years old

 

Audit Committee (Chair)                                     

 

Audit Committee

 

Financial Expert

 


Experience:

Canada Pension Plan Investment Board (2004-present)

  Managing Director

 

Former U.S. public company directorships held in the past five years:

  IMS Health (predecessor to IQVIA)

 

Other positions:

  Member, Board of Directors, NEWAsurion

 

Education:

  Master of Business Administration, University of Chicago Graduate School of Business

  Bachelor of Engineering, Royal Military College of Canada

 

 

Specific Experience: Because of Mr. Fasano’s extensive experience as a Managing Director at CPPIB and experience in finance and leadership roles, we believe he is well qualified to serve on the Board.

 

 


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IQVIA’s Corporate Governance

The Board is responsible for supervision of the overall affairs of the Company. The Board oversees our senior management, to whom it has delegated authority to manage the day-to-day operations of the Company. Members of the Board are kept informed of our business through discussions with our Chief Executive Officer and other officers, by reviewing materials provided to them and by participating in regular, as well as special, meetings of the Board and its committees. In addition, to promote open discussion among our non-management and independent directors, those directors meet in regularly scheduled executive sessions without the participation of our Chief Executive Officer. The Board has adopted Corporate Governance Guidelines, which, together with our Certificate of Incorporation and Bylaws and the other documents listed below, form the governance framework for the Board and its committees. The following sections provide an overview of our corporate governance structure, including director independence and other criteria we use in selecting director nominees, our board leadership structure and the responsibilities of the Board and each of its committees.

DOCUMENTS ESTABLISHING OUR CORPORATE GOVERNANCE

The Board has a long-standing commitment to sound and effective corporate governance practices. The following key documents are the foundation of corporate governance at the Company:

 

 

  Corporate Governance Guidelines

  

 

  Audit Committee Charter

  Code of Conduct

  

  LDC Committee Charter

  Certificate of Incorporation

  

  Nominating and Governance Committee Charter

  Bylaws

 

These documents and other important information on our corporate governance are posted in the “Corporate Governance” section of the “Investor Relations” section of our website under “Governance Documents” and “Committee Charters” and may be viewed at http://ir.iqvia.com. We will also provide printed copies of these documents free of charge to any stockholder who sends Investor Relations a request at: IQVIA Holdings Inc., 100 IMS Drive, Parsippany, New Jersey 07054.


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CORPORATE GOVERNANCE PRACTICES

IQVIA believes that a strong corporate governance framework is essential to our long-term success. We are committed to adopting and following strong corporate governance practices because we believe that such practices promote an environment of accountability for the Board and our senior management and otherwise promote the long-term interests of our stockholders. Our governance practices and policies include the following:

 

 

Independent Board

  

 

All our directors are independent except for our Chairman and Chief Executive Officer

 

Independent Board committees

  

 

Each of our three Board committees is composed solely of independent directors

 

Independent Lead Director; regular executive sessions

  

 

We have an independent Lead Director, who was elected by our independent directors, who has comprehensive duties set forth in our Corporate Governance Guidelines, including leading regular executive sessions of the Board, where independent directors meet without management present

 

Annual Board and committee self-assessment process

  

 

The Board and each Board committee, led by their respective chairs, conducts a self-assessment annually to determine whether it is functioning efficiently and meeting its governance responsibilities

 

Active stockholder engagement

  

 

We regularly meet with our stockholders to better understand their perspectives, and we enhanced our stockholder engagement and outreach efforts in 2019

 

Robust Code of Conduct

  

 

Our code of conduct, Doing the Right Thing, applies to our directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer, controller or persons performing similar functions. The code of conduct is a guide to the responsibilities we share for ethical business conduct and paints a clear picture of what we stand for as an organization, what we expect from ourselves, and what we must do to maintain our reputation

 

Prohibition on hedging or pledging of Company stock

  

 

Our securities trading policy prohibits hedging transactions with respect to, and the pledging of, our securities by any of our directors, officers or other employees or their immediate family members, except where the individual receives prior written approval from the General Counsel. In 2019, the General Counsel did not approve any stock hedging or pledging transactions and none of our current executive officers or directors have entered into any such hedging or pledging transactions

 

Share ownership requirements

  

 

We have robust share ownership guidelines, which require our named executive officers to hold between 3 times and 6 times base salary. Our share ownership policy requires our executive officers to hold 50% of the net shares received by them as a result of the exercise, vesting or settlement of long-term incentive awards until they meet their required ownership levels

 

Clawback Policy

  

 

We maintain a clawback policy that applies to current and former executive officers, among others, that provides for the recoupment of short- and long-term incentive compensation in the event of a financial restatement under specified circumstances

 

Director Resignation Policy

  

 

Directors are required to tender their resignation if they receive a number of withhold votes that is greater than 50% of all votes cast

 

Adopted a proxy access right

  

 

Eligible stockholders may, subject to certain requirements, include their own director nominees in our proxy materials


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LEADERSHIP STRUCTURE

Chairman and Chief Executive Officer

Mr. Bousbib became our Chairman and Chief Executive Officer on October 3, 2016, in connection with the Merger. We believe that the current board leadership structure, with the Chairman and Chief Executive Officer roles combined, is appropriate and in the best interests of our stockholders because our Chief Executive Officer has a unique depth of knowledge about the Company and the varied and complex opportunities and challenges we face. The role of the Chairman is to set the agenda for the board meetings and to preside over general board sessions. When the Board meets in executive session without management present to evaluate management’s performance, these sessions are presided by our independent Lead Director. Independent directors also evaluate our leadership structure regularly and garner feedback from stockholders. Our Chairman and Chief Executive Officer and the Lead Director communicate regularly during the course of the year.

The current board leadership structure provides for effective and efficient leadership because, among other things, it recognizes the value of one person both speaking for and leading the Company and the Board. The Board recognizes that there may be circumstances in the future that would lead it to separate these offices, but it does not believe there is any reason to do so at this time. The Board believes that this subject is primarily a matter of the succession planning process and that it is in the best interest of the Company for the Board to make this determination when it elects a new Chief Executive Officer or under such other circumstances that it believes are best for the Company at a given point in time.

Lead Director; Executive Sessions

The Lead Director helps ensure there is an appropriate balance between management and the independent directors and that the independent directors are fully informed and able to discuss and debate the issues that they deem important. Our current Lead Director is Dr. Leonard. The responsibilities of the Lead Director, as outlined in our Corporate Governance Guidelines include, among others:

 

Board Matter    Responsibility

Communicating with directors

  

Liaising between non-management directors and management

Executive sessions

  

Presiding at executive sessions of non-management directors

Board meetings

  

Presiding at all Board meetings when the Chairman is not present

Agendas

  

Consulting with the Chairman on matters pertinent to the Company and the Board, including meeting agendas, schedules and information sent to the Board

Communicating with stockholders

  

Consulting with major stockholders, as appropriate

The Board believes that one of the key elements of effective, independent oversight is that the independent directors meet in executive session on a regular basis without the presence of management. Accordingly, our independent directors meet separately in executive session at each regularly scheduled in-person Board meeting. Our independent directors held four executive sessions during 2019, all of which were led by the Lead Director.

Board Committees

To assist in carrying out its duties, the Board has delegated authority to three committees: the Audit Committee, the LDC Committee and the Nominating and Governance Committee. The Board held six (6) meetings during fiscal 2019. All of our current directors attended at least 75% of the total


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number of meetings of the Board and Board committees on which they served in 2019. Eight (8) directors attended the annual meeting of the stockholders in 2019.

BOARD STRUCTURE

The Board oversees the management of our business by our Chief Executive Officer and senior management. Our Certificate of Incorporation provides that the Board shall consist of at least five (5) directors but not more than seventeen (17) directors and that the number of directors may be fixed from time to time by resolution of the Board.

The Board is divided into three classes. Upon the expiration of the initial term of office for each class of directors, each director in such class shall be elected for a term of three years and serve until his or her successor is duly elected and qualified or until his or her earlier death, resignation, retirement, disqualification or removal. Any additional directorships resulting from an increase in the number of directors or a vacancy may be filled by the directors then in office.

In connection with the Merger, the Company entered into the Shareholders Agreement, which addresses, among other things, certain board designation rights, registration rights and transfer restrictions. The Board designation rights for each of the parties to the Shareholders Agreement have since ceased.

Following our 2020 Annual Meeting, the Board will be comprised of nine (9) directors, each of whom was designated for nomination as a director in accordance with our governance documents.

DIRECTOR INDEPENDENCE

The Board conducted an assessment of the independence of each director and determined that, other than our Chief Executive Officer, each of our directors continuing in office after the 2020 Annual Meeting is currently independent:

 

8 of 9

IQVIA Directors

are Independent

 

    

  Carol J. Burt

 

  John P. Connaughton 

 

  John G. Danhakl

 

  James A. Fasano

  

  Colleen A. Goggins

 

  John M. Leonard, M.D.

 

  Ronald A. Rittenmeyer

 

  Todd B. Sisitsky

In accordance with our Corporate Governance Guidelines and the corporate governance standards of the New York Stock Exchange (“NYSE”), this determination of independence means that the Board finds that the director has no material relationship with the Company, directly or indirectly, that would interfere with his or her exercise of independent judgment as a director of the Company. With respect to directors who are members of the Audit Committee and the LDC Committee, the Board has determined that each director meets an even higher standard as required by Securities and Exchange Commission (the “SEC”) and NYSE rules.

The Board has also determined that Ms. Burt, Messrs. Fasano and Rittenmeyer and Dr. Leonard are “Audit Committee Financial Experts” as such term also is defined in SEC rules and that each member of the Audit Committee is financially literate.


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COMMITTEES OF THE BOARD

The Board has three standing committees:

 

 

Audit Committee

 

 

Leadership Development and Compensation Committee

 

 

Nominating and Governance Committee

From time to time, the Board may also create ad hoc or special committees for certain purposes. Each committee is comprised solely of independent, non-employee directors. The charter of each committee provides that non-management directors who are not members of such committee may nonetheless attend meetings of such committee, but they may not vote.


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AUDIT

COMMITTEE

2019 Meetings:

The Audit Committee held eight (8) meetings during fiscal 2019

 

Members in 2019:

 

James A. Fasano (Chair)

 

Michael J. Evanisko

 

Colleen A. Goggins

 

John M. Leonard, M.D.

 

Ronald A. Rittenmeyer

  

Responsibilities:

 

  Assisting the Board in fulfilling its oversight responsibilities relating to: (i) the integrity of the Company’s financial statements, (ii) the Company’s compliance with legal and regulatory requirements, including its quality assurance function overseeing clinical trial services, (iii) the independent auditor’s qualifications and independence, (iv) the performance of the Company’s internal audit function and the independent auditor, and (v) the performance of the Company’s compliance and ethics program

 

  Reviewing and discussing with management and the independent auditor the annual and quarterly financial statements prior to the filing of the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q

 

  Discussing earnings press releases and the financial information and earnings guidance included therein

 

  Overseeing the relationship between the Company and our independent registered public accounting firm, including:

 

  Having direct responsibility for its appointment, compensation and retention

 

  Reviewing the scope of its audit services

 

  Approving its non-audit services

 

  Reviewing and evaluating its independence

 

  Reviewing with internal auditors and the independent auditor the overall scope and plans for audits, including authority and organizational reporting lines and adequacy of staffing and compensation, and monitor the progress and results of such plans during the year

 

  Reviewing with internal auditors and the independent auditor any audit problems or difficulties, including any restrictions on the scope of the independent auditor’s activities or on access to requested information and any significant disagreements with management, and management’s response to such problems or difficulties

 

  Overseeing management’s implementation and maintenance of effective systems of internal controls over financial reporting and disclosure controls, and reviewing and discussing with management, internal auditors and the independent auditor the Company’s system of internal control, its financial and critical accounting policies and practices, policies relating to risk assessment and risk management and our major financial risk exposures

 

  Reviewing and approving all related party transactions and corporate opportunity transactions


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LEADERSHIP DEVELOPMENT AND
COMPENSATION COMMITTEE

2019 Meetings:

The LDC Committee held five (5)
meetings during fiscal 2019

 

Members in 2019:

 

Ronald A. Rittenmeyer (Chair)

 

John P. Connaughton

 

John G. Danhakl

 

Todd B. Sisitsky

  

Responsibilities:

 

  Reviewing and approving corporate goals and objectives relevant to the compensation of our Chief Executive Officer and the officers of the Company who report directly to our Chief Executive Officer and all officers who are “insiders” subject to Section 16 of the Exchange Act (“Senior Officers”)

 

  Evaluating the performance of our Chief Executive Officer and other Senior Officers in light of those goals and objectives and, either as a committee or together with the other independent directors (as directed by the Board), determining and approving, or recommending to the Board for approval, the compensation levels for our Chief Executive Officer and other Senior Officers

 

  Making recommendations to the Board about the compensation of our directors

 

  Administering our equity-based plans and management incentive compensation plans and making recommendations to the Board about amendments to such plans and the adoption of any new employee incentive compensation plans

 

  Recommending to the Board ownership guidelines for the Senior Officers, other executives and non-employee directors, and periodically assessing these guidelines and recommending revisions as appropriate

 

  Establishing the terms of compensatory arrangements and policies to protect our business, including restrictions that apply to current and former Senior Officers

 

  Reviewing and approving all Senior Officer employment contracts and other compensatory, severance and change in control arrangements for current and former Senior Officers, reviewing and establishing our overall management compensation and benefits philosophy and policy, and reviewing and approving our policies and procedures for the grant of equity-based awards

 

  Establishing and reviewing periodically policies and procedures with respect to perquisites

 

  Reviewing our incentive compensation arrangements to determine whether they encourage excessive risk-taking, reviewing and discussing at least annually the relationship between risk management policies and practices and compensation, and evaluating compensation policies and practices that could mitigate any such risk

 

  Reviewing the processes for managing executive succession and the results of those processes


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NOMINATING AND

GOVERNANCE COMMITTEE

2019 Meetings:

The Nominating and Governance Committee held four (4) meetings during fiscal 2019

 

Members in 2019:

 

Todd B. Sisitsky (Chair)

 

John G. Danhakl

 

Colleen A. Goggins

 

John M. Leonard, M.D.

  

Responsibilities:

 

  Identifying individuals qualified to become members of the Board, consistent with criteria approved by the Board

 

  Establishing processes for identifying and evaluating Board candidates, including nominees recommended by stockholders

 

  Recommending to the Board the persons to be nominated for election as directors and to each of the Board’s committees

 

  Developing and recommending to the Board a set of corporate governance principles

 

  Articulating to each director what is expected, including reference to the corporate governance principles and directors’ duties and responsibilities

 

  Reviewing and recommending to the Board practices and policies with respect to directors

 

  Evaluating and making recommendations to the Board regarding stockholder proposals that relate to corporate governance and other matters related to stockholders

 

  Overseeing the evaluation of the Board

 

The Nominating and Governance Committee will consider stockholders’ recommendations of nominees for membership on the Board. Stockholders may recommend candidates for membership on the Board to the Nominating and Governance Committee by submitting the names in writing to: Secretary, IQVIA Holdings Inc., 100 IMS Drive, Parsippany, New Jersey 07054.

 

The Bylaws specify certain time limitations, notice requirements and other procedures applicable to the submission of nominations before an annual or special meeting. These procedures are described below under the caption “Stockholder Proposals for 2021 Annual Meeting of Stockholders.”


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BOARD’S ROLE IN RISK OVERSIGHT

Our Board actively oversees our enterprise risk management program to ensure that we maintain effective risk management. Our Board’s role in risk oversight is consistent with our overall leadership structure—management is responsible for assessing and managing our risk exposures, and our Board maintains an oversight role, executed through open communication with management and independent oversight of strategic risks. Our Board considers key risk topics in its oversight, including risks associated with our strategic plan, our capital structure, our business activities, and social and environmental matters. Risks are identified by management and reviewed with the appropriate Board committee or the full Board for oversight.

In 2018, we established an Enterprise Risk Council, comprised of leaders from our principal functional areas and business units that meet on a quarterly basis, to update our enterprise risk framework used to identify and manage our key risks. The framework considers external and internal factors that could impede the achievement of our business objectives or damage our brand, reputation or financial condition. The Board reviews these key risks and the related framework annually, and the Board or appropriate Board committees discuss selected risks in more detail throughout the year, as discussed below.

While our Board has the ultimate oversight responsibility for the risk management process, our Board’s committees assist it in fulfilling its oversight responsibilities in certain areas of risk. In particular, our Audit Committee focuses on risks associated with our financial statements, internal accounting and financial controls, internal and external audits, cybersecurity, compliance with legal and regulatory matters and performance of our compliance and ethics program in connection therewith, including our guidelines and policies with respect to risk assessment and risk management and our major financial risk exposures. Our LDC Committee focuses on risks associated with our compensation policies and practices, including those for our executive officers. Our Nominating and Governance Committee focuses on risks associated with our corporate governance policies and practices.

Each of these committees reports to our Board with respect to the risk categories it oversees. These ongoing discussions enable our Board to monitor our risk exposure and evaluate our risk mitigation efforts. In addition, our risk management function conducts regular interviews and surveys of key employees relating to enterprise risk management and reports the results and analysis of such interviews and surveys to our Board.

SUCCESSION PLANNING FOR DIRECTORS AND EXECUTIVE OFFICERS

Directors. Vacancies on the Board may occur from time to time. The Bylaws provide that any vacancy caused by the death or resignation of a director may be filled by the affirmative vote of a majority of the directors then in office.

Subject to the terms of the Bylaws, the Nominating and Governance Committee is responsible for recommending to the Board the persons to be nominated for election as directors and to each of the Board’s committees. It is the Board’s policy that the composition of the Board at all times adhere to the standards of independence promulgated by the NYSE as further clarified herein and reflect a range of talents, ages, skills, character, diversity and expertise, particularly in the areas of accounting and finance, management, domestic and international markets, leadership and corporate governance, our industry and the markets we serve sufficient to provide sound and prudent guidance with respect to our operations and interests.

As provided in its Corporate Governance Guidelines, the Board also seeks to achieve a mix of directors that enhances the diversity of background, including with respect to professional skills, relevant


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industry experience, specialized expertise, international experience, gender, race and ethnicity, to maintain a diverse membership. The process of determining to add a new Board member and identifying qualified candidates begins well in advance of anticipated vacancies. Under this ongoing process, the Chairman of the Nominating and Governance Committee and our Chief Executive Officer monitor and maintain an open dialogue, and also consult with the other members of the Board, including our Lead Director, regarding the size of the Board, future retirements and director attributes desired for any new directorships. Once a decision has been made to recruit a new director, the Nominating and Governance Committee may retain an executive recruitment organization to assist it in its search by providing a range of qualified candidates.

The Board has been, and will continue to be, focused on a refreshment program to ensure the composition of the Board has the appropriate mix of diverse backgrounds, skills and experiences to support the Company’s strategy.

Executive Officers. In addition, the Board also plans for succession to the positions of Chairman of the Board and Chief Executive Officer as well as certain other senior management positions. To assist the Board, our Chief Executive Officer periodically provides the LDC Committee with an assessment of senior managers and of their potential to succeed him. He also provides the LDC Committee with an assessment of persons considered potential successors to certain other senior management positions. This assessment results from our leadership development and succession planning process, which involves three principal steps:

 

 

Regional and global business unit and corporate staff function assessments to identify key employees and employees with high potential for increased responsibilities

 

 

Chief Executive Officer assessments of the leaders of the regional and global business units and corporate staff functions, focusing on senior executives’ development and succession

 

 

Board review and approval, focusing on Chief Executive Officer succession, key senior executives’ development and succession, the pool of high-potential executives and initiatives to improve retention and promote their development as company leaders

We use tools and processes, followed by face-to-face reviews, to implement our leadership development and succession planning process. Through this process, we identify a pool of high-potential employees who are selected for development. Our development program emphasizes skills training, education and career planning.

HOW TO CONTACT THE BOARD AND ITS COMMITTEES

We have established a process by which stockholders and other interested parties can contact the Board, or a committee of the Board. To contact the Board or a Board committee, you can send an email to BoD@iqvia.com, or write to the following address:

Board of Directors

c/o Secretary

IQVIA Holdings Inc.

100 IMS Drive

Parsippany, New Jersey 07054

Communications will be distributed to the Chairman of the Board or the other members of the Board as appropriate depending on the facts and circumstances outlined in the communication received.


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SUSTAINABILITY AND CORPORATE CITIZENSHIP

Sustainability and Corporate citizenship are essential elements of our culture and vision. A focus on wellness and safety of our employees and customers, product innovation, environmental responsibility and ethical business practices is central to our success — and this culture of caring extends to the communities where we live and work. We strive to make a difference locally and globally.

We pay close attention to quality and compliance while embracing fresh ideas and new innovations. This dual commitment empowers us to improve healthcare — enhancing and advancing wellness and safety, strengthening supplier relationships, and supporting environmental stewardship.

We demonstrate this commitment by adopting policies and practices in specific areas related to sustainable development, including environment and health and safety; corporate social giving; workers’ human rights; protecting individual privacy; and ethical business practices.

 

     
People      Public      Planet
     
Creating a workplace of highly engaged, safe, and healthy employees who follow the Code
of Conduct
    

Engaging consistently and transparently in a manner that inspires participation and demonstrates leadership in sustainability

 

     Making a positive impact on the environments we work in

 

     

  People

     

Everyone at IQVIA, regardless of their role, contributes to a greater purpose. Our culture is based on five core values: Client focus, Results, Teamwork, Flawless execution, and Integrity. As a team, we are not only moving healthcare forward, we are leading the charge to take it further than ever before. We strive to give our best in everything we do. We embrace the challenge because we are uniquely positioned to make a tangible, meaningful difference.

Diversity and Inclusion. We are committed to maintaining a culture of inclusion in which people from all backgrounds can fully contribute to the growth and success of our business. We create this culture of inclusion for employees regardless of gender, race, color, creed, religion, marital status, age, national origin or ancestry, physical or mental disability, medical condition, veteran status, citizenship, sexual orientation, gender identity, or any other protected group status. As such, our business is focused on three core areas:

 

1.

Recruitment. IQVIA is committed to considering a range of qualified candidates for all positions and to hiring qualified individuals with a variety of backgrounds and experiences from within and outside the organization for positions at all levels.

 

2.

Development & Progression. IQVIA is focused on having a diverse pipeline of talent moving up in our organization and providing opportunities for all employees to develop within their current role as well as towards their next role.

 

3.

Retention. Once we hire the right people, we want them to stay. To increase employee engagement and retention, we consistently seek feedback from employees through surveys and focus groups. We will continue to use this feedback and review our processes to identify additional initiatives aimed to further increase employee retention.

Public Recognition. We were named to the Forbes 2019 list of America’s Best Employers for Women and recognized again by FORTUNE as one of the World’s Most Admired Companies in 2019.

Employee Engagement Survey. In late 2018, we deployed our first company-wide employee engagement survey following the Merger. We received valuable feedback regarding employee roles, team environments, relationships with management and career progression. Using this feedback,


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action plans were developed at both global and local levels in 2019. We continue to harmonize our systems as well as implement tools and programs to equip employees with the resources they need for their jobs and help them take ownership of their careers. In 2020, we will continue to progress our employee engagement survey action plans.

 

     

  Public

     

At IQVIA, we are inspired to advance health outcomes. Through collaboration, we hope to overcome some of the biggest challenges facing global health. A few examples of initiatives that IQVIA is engaged in include:

 

   

Facilitating sharing insights on anti-cancer medicines. We established the Oncology Data Network, which delivers insights into how anti-cancer medicines are being used in Europe in real-time to participating centers across Europe within 24 hours to accelerate their clinical research efforts.

 

   

Supporting progress against antimicrobial resistance. IQVIA is part of the Centers for Disease Control and United Nations’ Antimicrobial Resistance Challenge, an effort to accelerate the fight against antimicrobial resistance across the globe.

 

   

Leading the Way in Drug Safety: IQVIA formed a novel alliance with the FDA Center for Biologics Evaluation and Research to monitor and evaluate the safety and effectiveness of various vaccines, blood products, and other biologics.

 

   

Fighting the Opioid Epidemic: IQVIA partnered with the American Medical Association’s Opioid Task Force to support strategies that target the nation’s opioid epidemic and continues to provide valuable insights into the ongoing efforts to combat this public health issue.

 

   

Collaborating with Cancer Researchers to Advance Real World Evidence: IQVIA collaborates with Friends of Cancer Research in a cross-industry effort to advance acceptance and drive future uses of real world evidence.

 

   

Providing the Public with Key Public Health Information. We provide key healthcare measurements for flu, allergy, and cough and cold season at the zip code level in the US through FluSTAR.com and its mobile app, giving consumers unique insights into the spread of flu and colds in the US.

 

     

  Planet

     

We comply with health and safety regulations for workers globally pursuant to local laws and regulations. Environmental laws and regulations are incorporated into our policies and procedures to ensure compliance. Select locations are certified to ISO 14001:2004 and OHSAS 18001, including group certifications at the corporate level to both standards. IQVIA has an Environmental, Health & Safety Policy and supporting standard operating procedures in place. We expect all staff to actively participate in helping to ensure a safe, healthy, and secure work environment.


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We are not a manufacturer of products and have a relatively light physical footprint through our offices and laboratory facilities. Our primary GHG emissions impact is associated with our business travel, when providing services to our customers. Our reported emissions for 2017 and 2018 indicate a 3.3% reduction year over year, or an equivalent of 7,914 tons across Scope 1-3, which is notable given the significant increase of our number of employees over the same period. We similarly reduced our real estate footprint by approximately 110,000 square feet during this time, which contributed to our GHG reduction.

We are acutely aware of our energy consumption associated with business travel and our operations and are actively pursuing further reductions through more efficient use of energy in our buildings, requiring virtual meetings where possible and raising awareness of the impact of travel to our employees in order to reduce impact on the climate.

 

Greenhouse Gas Emissions (GHG)

Metric Tons Equivalent

 

LOGO

 

 

     

  Industry Standards

     

 

LOGO

  

IQVIA holds a rating of A in the MSCI ESG Ratings assessment. MSCI rates companies according to their exposure to industry-significant ESG (Environment, Social & Governance) risks and their ability to manage those risks relative to industry peers.

 

LOGO   

 

IQVIA has been awarded a Bronze Rating by EcoVadis in recognition of our achievements as a top 65% performer across more than 55,000 companies assessed by EcoVadis. EcoVadis is a global provider of business sustainability ratings. IQVIA is in the top 11% of companies assessed by EcoVadis in the scientific research and development industry. We are targeting achievement of Silver Rating by end of 2020.

 

LOGO

   IQVIA is an active member of CDP (formerly Carbon Disclosure Project), globally recognized assessors of corporate sustainability metrics. We provide data to CDP annually on our energy use, waste management and our greenhouse gas emissions. CDP is a tool that helps us keep track of progress and provides insight of key performance metrics to drive improvements to reduce our corporate carbon footprint.

Our 2019 Sustainability and Corporate Citizen Report, which provides increased visibility into our governance programs, commitment to and support for the communities in which we live and work is available on our website at https://ir.iqvia.com/corporate-responsibility-and-sustainability.


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STOCKHOLDER ENGAGEMENT

Our Board and management are committed to regular engagement with our stockholders and soliciting their views and input on matters related to performance, corporate governance, environmental and social impacts, human capital management and executive compensation, among other topics.

 

  Our Approach

 

     

Who

 

When & How

 

Engagement Approach

  Stockholders

 

  Research Analysts

 

  Proxy Advisory Firms

 

  Year-Around

 

  Targeted outreach ahead of annual meetings and as needed

 

  In-person meetings

 

  Teleconferences and phone calls

 

  Industry conferences

 

  IQVIA Financial Analyst and Investor Conference

 

 

Board Engagement

 

  Led by our Lead Director and Chair of our Nominating and Governance Committee

 

  Lead Director provides feedback to the rest of the Board

 

Management Engagement

 

  Led by our Chief Executive Officer, Chief Financial Officer, General Counsel and SVP, Investor Relations and Treasurer

 

  Targeted outreach and inbound inquiries

 

  Feedback provided to senior management and the Board

 

 

  Depth of Engagement

In 2019, we conducted significant proactive engagement with our stockholders. A summary of our engagement program is included below.

 

 

Senior executives met throughout the year with 70% of our top 100 stockholders, representing approximately 55% of our common stock, to discuss Company performance and strategy, among other topics. Participants typically included a combination of our Chief Executive Officer, Chief Financial Officer and our Senior Vice President, Investor Relations and Treasurer

 

 

We also requested meetings with stockholders representing approximately 39% of our outstanding common stock to discuss and solicit feedback on our practices relating to corporate governance, executive compensation, and sustainability and corporate citizenship matters, among other topics

 

   

Senior executives, including our Chief Financial Officer, General Counsel and Senior Vice President, Investor Relations and Treasurer, met each stockholder who responded to our outreach efforts, which included ten stockholders, representing approximately 25% of our common stock

 

   

Our Lead Director and the Chair of the Nominating and Governance Committee also participated in a subset of meetings with five stockholders, representing approximately 16% of our outstanding common stock

 

 

We hosted a Financial Analyst and Investor Conference during which 20 of our senior executives gave a comprehensive overview of our businesses. Our Chief Executive Officer laid out our strategy over the next three years and our Chief Financial Officer provided medium-term financial guidance. Over 200 investors, analysts and other stakeholders attended the Conference in person and almost 400 investors listened to the live webcast


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What we learned from our meetings with stockholders:

 

 

Stockholders greatly appreciated the opportunity to meet with our senior executives and members of our Board and expressed their satisfaction with our financial results, management’s achievement of its stated objectives and our success in the market with new offerings

 

 

Stockholders expressed an interest in a more readable and focused proxy statement that provides greater clarity and transparency on our governance programs, and executive compensation program

 

 

Stockholders were interested in how we manage human capital, how we solicit feedback from employees and how we respond to that feedback

 

 

Stockholders commented approvingly on our overall compensation program and leadership team and were interested in better understanding our short-term incentive program and the relationship among target objectives, achievement and executive compensation determinations

 

 

Stockholders expressed an interest in the Company adopting a proxy access bylaw

 

 

Stockholders requested enhanced disclosure on sustainability and corporate citizenship matters

Our responses to stockholder input:

 

 

Committed to continuing and enhancing our stockholder engagement program by meeting with stockholders on a regular basis to discuss the Company’s strategy, progress against strategic, financial and operational objectives and corporate governance matters

 

 

Enhanced our Proxy Statement by enhancing the style of presentation of the filing throughout, adding a more comprehensive stockholder letter from our Chief Executive Officer, adding new summary sections and sections on stockholder engagement and sustainability and corporate citizenship, and deepening our disclosure on corporate governance matters and our executive compensation program, among other areas

 

 

Described in this Proxy Statement our employee engagement survey that we conducted in late 2018 and our focused efforts in 2019 to implement action plans to address employee feedback

 

 

Enhanced our Compensation Discussion and Analysis by making the disclosure easier to follow and enhancing disclosure about our compensation philosophy with regard to our short-term incentive plan, including the setting of objectives and determination of short-term annual incentive awards for our named executive officers

 

 

Adopted a proxy access bylaw to allow qualifying stockholders/stockholder groups to include director nominee information in our proxy statements

 

 

Enhanced our Sustainability and Corporate Citizenship Disclosure by publishing an updated version of our Sustainability and Corporate Citizenship Report for 2019 and including additional sustainability and corporate citizenship information and highlights in this Proxy Statement


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Director Compensation

NON-EMPLOYEE DIRECTOR COMPENSATION PROGRAM

Non-employee director compensation is assessed each year by the LDC Committee, based on input from Steven Hall & Partners, an independent compensation consulting firm (our “external compensation consultant”), and taking into account compensation paid to non-employee directors at companies in the same peer group used for executive compensation purposes, as described below in the Compensation Discussion and Analysis under “Overview of our Executive Compensation Program—Benchmarking” beginning on page 44. The Board reviews recommendations made by the LDC Committee as a result of its annual assessment of non-employee director compensation and makes a final determination on the compensation of our non-employee directors. For compensation paid in 2019, this assessment took place in July 2018. Based on its assessment, the LDC Committee did not recommend to the Board any changes to non-employee director compensation for 2019.

Under our non-employee director compensation program, each member of the Board who is not an employee and who is not affiliated with the SHA Parties (as defined and identified under “Certain Relationships and Related Party Transactions—Shareholders Agreement” below) is eligible to receive compensation consisting of an annual retainer of $100,000 paid in cash in quarterly installments and an annual grant of fully vested restricted stock units with a grant date fair value of approximately $200,000. In addition, under the program, eligible directors receive additional payments, paid in cash on a quarterly basis, for service on the committees of the Board. We also reimburse our directors for reasonable travel expenses and other out-of-pocket costs incurred in connection with attendance at Board meetings.

The non-employee director compensation program for directors who are not affiliated with the SHA Parties is as follows:

 

Payment

  

Annual Compensation ($) 

 

Cash retainer

  

 

100,000

 

Equity retainer fair value (payable in fully vested restricted stock units)

  

 

200,000

 

Committee Chair Fees:

  

    Audit

  

 

30,000

 

    Leadership Development and Compensation

  

 

25,000

 

    Nominating and Governance

  

 

20,000

 

Lead Director Fee

  

 

42,500

 

Committee Member (other than Chairs) Fees:

  

    Audit

  

 

10,000

 

    Leadership Development and Compensation

  

 

5,000

 

    Nominating and Governance

  

 

5,000

 

Committee membership fees are not paid to the chairperson of a committee. The Board has the authority to set the terms of our non-employee director compensation program and may change those terms at any time.


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Non-employee director compensation for 2019. The following table shows information regarding the compensation earned by our non-employee directors during 2019. The compensation received by our Chief Executive Officer during 2019 is included in the “Summary Compensation Table” below. Our Chief Executive Officer did not receive any additional compensation for his service on the Board. Only our non-employee directors not affiliated with the current SHA Parties receive compensation for their service on the Board.

2019 DIRECTOR COMPENSATION

 

Name

  

Fees Earned or
Paid in Cash ($)

    

Stock Awards  ($)(1)

    

Total ($)

 

Carol J. Burt(2)

  

 

75,000

 

  

 

199,885

 

  

 

274,885

 

John P. Connaughton

  

 

 

  

 

 

  

 

 

Jonathan J. Coslet

  

 

 

  

 

 

  

 

 

John G. Danhakl(3)

  

 

82,500

 

  

 

199,885

 

  

 

282,385

 

Michael J. Evanisko(4)

  

 

110,000

 

  

 

199,885

 

  

 

309,885

 

James A. Fasano

  

 

 

  

 

 

  

 

 

Colleen A. Goggins(5)

  

 

115,000

 

  

 

199,885

 

  

 

314,885

 

Jack M. Greenberg(6)

  

 

31,250

 

  

 

 

  

 

31,250

 

John M. Leonard, M.D.

  

 

157,500

 

  

 

199,885

 

  

 

357,385

 

Ronald A. Rittenmeyer

  

 

135,000

 

  

 

199,885

 

  

 

334,885

 

Todd B. Sisitsky

  

 

 

  

 

 

  

 

 

 

(1)

In accordance with our non-employee director compensation program, restricted stock units were granted to each of Mses. Burt and Goggins, Messrs. Danhakl, Evanisko and Rittenmeyer and Dr. Leonard on May 16, 2019 (1,478 restricted stock units each). These restricted stock units were fully vested when granted. Amounts reflect the aggregate grant date fair value of the restricted stock units at May 16, 2019 ($135.24 per share) computed in accordance with Accounting Standards Codification Topic 718, or ASC 718, excluding the impact of estimated forfeitures. Assumptions used in the calculation of these amounts in 2019 are included in Notes 1 and 17 to our consolidated audited financial statements for the year ended December 31, 2019 included in Part II of our annual report on Form 10-K.

 

(2)

Ms. Burt was elected as a director of the Board on February 21, 2019, and her cash retainer and fees were earned based on her service commencing on February 21, 2019.

 

(3)

Mr. Danhakl began earning his cash retainer and fees based on his service commencing April 9, 2019, following his reelection to the Board. Mr. Danhakl was not designated for nomination to the Board by one of the SHA Parties in connection with his reelection.

 

(4)

The aggregate number of shares that were subject to outstanding stock options as of December 31, 2019 is 92,600 for Mr. Evanisko.

 

(5)

Ms. Goggins deferred 100% of her annual cash Board retainers and committee fees under our Director Deferral Plan, described below, which amounts were converted into deferred shares that are payable in shares of Company common stock following a termination of the director’s Board service or the director’s death, or upon a change in control of the Company. As of December 31, 2019, Ms. Goggins has 815 deferred shares outstanding under the Director Deferral Plan.

 

(6)

Mr. Greenberg retired from the Board on April 9, 2019 following our 2019 annual meeting of stockholders.

Director share ownership guidelines. Under the Company’s share ownership guidelines established by the LDC Committee, each member of the Board who is not an employee and is not affiliated with the SHA Parties is expected to hold shares of our common stock that have a value equal to five (5) times his or her annual cash retainer for service as a director. While there is no set period in which this ownership level must be met, each non-employee director not affiliated with the SHA Parties is required to retain ownership of at least 50% of the shares received by him or her as a result of the exercise, vesting or settlement of equity awards, until the share ownership guideline is met. The LDC Committee is responsible for setting and periodically reviewing these guidelines. The LDC Committee oversees compliance with these guidelines, and reviews director holdings annually. Other than Ms. Burt, who joined the Board in February 2019, each non-employee director not affiliated with the SHA Parties has already satisfied his or her share ownership requirement.


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Non-Employee Director Deferral Plan. Pursuant to the IQVIA Holdings Inc. Non-Employee Director Deferral Plan (the “Director Deferral Plan”), non-employee directors may elect to defer receipt of their cash retainers. If a director elects to defer his or her retainer, he or she will instead be credited with that value in deferred shares under the Director Deferral Plan. Deferred shares become payable in Company common stock following a termination of the director’s Board service or the director’s death, or upon a change in control of the Company.


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Proposal No. 2:
Non-Binding Vote on Executive Compensation

As required pursuant to Section 14A of the Exchange Act, the Board is pleased to provide stockholders with the opportunity to cast an advisory, non-binding vote on compensation of our named executive officers (“say-on-pay”), as disclosed in this Proxy Statement pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and related narrative disclosure.

Our compensation strategy focuses on providing a total compensation package that is designed to attract and retain high-caliber executives by incentivizing them to achieve Company and individual performance goals and closely aligning these goals with stockholder interests. Our philosophy reflects our emphasis on pay for performance and on long-term value creation for our stockholders. The LDC Committee believes that the Company’s executive compensation program and the compensation decisions for 2019 described in this Proxy Statement, including the Compensation Discussion and Analysis, appropriately reward our named executive officers for their and our performance and that these programs and policies will assist the Company in retaining our senior leadership team.

In considering their vote, we urge stockholders to review the full details of our executive compensation program and decisions presented in the Compensation Discussion and Analysis and the discussions regarding the LDC Committee included elsewhere in this Proxy Statement.

Because your vote is advisory, it will not be binding on the Board and will not overrule any decision by the Board or require the Board to take any action. However, the Board and the LDC Committee value the views of stockholders and will consider the outcome of the say-on-pay vote when making future executive compensation decisions for our named executive officers. We will hold a non-binding, advisory vote of stockholders on the compensation of our named executive officers every three years until the next required stockholder vote on the frequency of such advisory vote. The next stockholder vote on the frequency of such advisory vote is expected to be held at our 2023 annual meeting.

The text of the resolution in respect of Proposal No. 2, as required by proxy rules, is as follows:

RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed in the Company’s Proxy Statement for the 2020 annual meeting of stockholders pursuant to Item 402 of Regulation S-K, including the Compensation Discussion and Analysis, compensation tables and narrative discussion, is hereby APPROVED.”

 

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THE BOARD RECOMMENDS A VOTE “FOR” THE APPROVAL OF OUR EXECUTIVE COMPENSATION AS DESCRIBED IN THIS PROXY STATEMENT

 


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Compensation Discussion and Analysis

The following Compensation Discussion and Analysis (“CD&A”) is organized around five key factors we believe are important for our stockholders and an evaluation and understanding of our executive compensation program.

Summary of factors for stockholder consideration

 

 1.   

Strong performance

 

2019 Business Results

     

$11.1Bn

Revenue

 

$2.4Bn

Adjusted

EBITDA

 

$6.39

Adjusted

Diluted EPS

 

   
     

h  6.5%  

 

h  7.9%  

 

h  15.1%  

 

Business Highlights

 

  Contracted business with over 250 new R&DS customers in 2019, with 13 of the top 20 pharmaceutical companies using CORE-powered smart trials

 

  50 OCE customer wins in 2019, versus 30 in 2018, the first full year since product launch

Capital Deployment

 

  $945M in share repurchases in 2019, resulting in $6.0Bn since Merger

 

  $1.2Bn investments in software development, capability building M&A, technology infrastructure, E360 enhancements, among others

 

 2.    Sound pay practices

 

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Alignment of named executive pay with performance

 

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Setting of challenging individual performance objectives

 

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Appropriate balance of short- and long-term incentives

 

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Alignment of executive compensation with stockholder returns through performance-based long-term incentive awards

 

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No contracts with guaranteed salary increase or non-performance bonus arrangements

 

 3.   

Disciplined assessment
to determine pay

 

Balanced Individual Performance Evaluation

Grants of annual awards based in part on four key performance areas:

 

  Business Results

 

  Strategic Initiatives

 

  Operational Excellence

 

  People Management & Leadership

Short-Term Incentive Awards

If actual Revenue or Adjusted EBITDA achievement, against pre-established targets, is less than the threshold amount, our Annual Plan does not allow short-term incentive awards to be paid to our named executive officers.

Long-Term Incentive Awards

Performance shares link ultimate payout to pre-established Relative TSR and Adjusted Diluted EPS goals.

This discussion and analysis of our executive compensation program should be read in conjunction with the accompanying tables below and text disclosing the compensation awarded to, earned by or paid to our named executive officers.

 4.   

Pay is aligned with performance

 

 

  86.8% of our Chief Executive Officer’s total 2019 compensation was performance-linked.

Chief Executive Officer

 

 

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Shareholder Feedback

In response to 88% say-on-pay support in 2017 and the positive stockholder feedback we received in connection with our stockholder engagement described above, the LDC Committee maintained the key features of our executive compensation programs for 2019.

 

 5.    Rigorous accountability, risk-mitigation
and recovery provisions

 

  Significant stock ownership requirements

 

  Conduct an annual compensation risk review and assessment to ensure our executive compensation program promotes our long-term business success without encouraging excessive risk taking

 

  Strong forfeiture and clawback provisions cover both cash- and equity-based awards

 

Trigger

 

Vested

   

Unvested

 

Restatement

 

 

 

 

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Breach of Restrictive Covenants

 

 

 

 

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Compensation of our named executive officers is determined under our executive compensation program. This program is overseen by the LDC Committee. The LDC Committee, together with the Board with respect to certain matters, determines the compensation and benefits of our executive officers and administers our equity-based and other compensation plans. As a general matter, we regularly communicate with our large and mid-size investors to discuss corporate governance, executive compensation and sustainability matters and seek their feedback on our practices.

 


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1. STRONG PERFORMANCE

In 2019, we continued to make significant progress combining the Quintiles and IMS Health businesses during the final year of our three-year Merger integration period. Highlights of our performance in 2019 include:

 

 

    2019 Key Financial Metrics

 

  

 

Year-over-Year Growth

 

Revenue

$11.1Bn

  

    6.5%

Adjusted EBITDA1

$2.4Bn

  

    7.9%

Adjusted Diluted EPS1

$6.39

  

    15.1%

  

Total Stockholder

Return

 

 

  

    33%

 

1 

See reconciliation of non-GAAP items in the Appendix.

2019 Accomplishment Summary. 2019 was a year of major milestones and accomplishments for our organization, including the following:

 

 

Named to FORTUNE’s list of World’s Most Admired Companies

 

 

Recognized as one of America’s Best Employers for Women by Forbes

 

 

Earned top honors as the Best Contract Research Organization Full-service Provider by Scrip Awards

 

 

Closed the year with $19 billion of Research & Development Solutions backlog, and next twelve month revenue from backlog increased approximately $400 million to $5.2 billion, showing promising signs of continued revenue acceleration

 

 

Gained significant traction with our commercial Orchestrated Customer Engagement SaaS-based platform, which is built on best-in-class technologies such as Salesforce, Mulesoft, Heroku and others, with 50 new life sciences clients deciding to standardize on our superior technology, including four top-15 pharmaceutical companies

 

 

Continued our partnership with Salesforce to develop a suite of clinical trial technology, investing considerable resources and expertise into our innovative technology platforms to address critical client needs in the clinical area and in the regulatory, compliance, safety and quality space

 

Continued investments in rich clinical data assets which now stands at 800 million non-identified patients globally

 

 

Deployed total investment of $1.2 billion in net cash, including new product and technology development as well as strategic acquisitions

 

 

Returned approximately $945 million to stockholders in the form of share repurchases

We believe that the efforts of our named executive officers were critical to achieving these results and significant milestones. We considered a number of factors in assessing each named executive officer’s individual performance, including contribution to these business results and strategic objectives and the achievement of pre-established corporate and individual objectives, among other things, in determining each named executive officer’s annual incentive under our annual short-term incentive plan award for 2019.


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Amounts expressed in constant currency terms in this Proxy Statement exclude the effect of changes in foreign currency exchange rates on the translation of foreign currency results into U.S. dollars. For additional information regarding foreign currency translation, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our 2019 Annual Report. The definitions of Adjusted EBITDA and Adjusted Diluted EPS figures are the same, and reconciled back to the nearest comparable GAAP financial measure in the exact same manner, as in the Company’s earnings releases. For additional information regarding “Adjusted EBITDA,” and “Adjusted Diluted EPS,” including a reconciliation of these non-GAAP financial measures to net income, see “Appendix A—Financial Reconciliations”.

Total Stockholder Return. As discussed earlier in this Proxy Statement, we successfully delivered on our three-year Merger integration commitments, delivering accelerated top line growth, with total revenue growth accelerating by over 200 basis points entering 2019 and achieving run-rate cost savings of over $200 million exiting 2019. We delivered financial performance at or above expectations every one of the 13 quarters since the Merger, and in 2019 we set new three-year targets for the 2020-2022 three-year period. The following graph shows a comparison of the total cumulative stockholder return for our common stock, the Standard & Poor’s 500 Stock Index (“S&P 500”) and a select peer group for the three-year period from the end of 2016 through 2019. December 31, 2019 marks the end of our three-year merger integration period. The below graph assumes that $100 was invested in IQVIA Holdings Inc., the S&P 500 and the stock performance peer group described below as of the close of market on December 31, 2016 and assumes the reinvestments of dividends, if any.

 

 

Total Stockholder Return Over the Past Three Years (December 31, 2016 to December 31, 2019)

 

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(1) 

Peer group consists of Cerner Corporation, Charles River Laboratories, Inc., Equifax Inc., ICON plc, IHS Markit Ltd., Laboratory Corporation of America Holdings, Nielsen N.V., PRA Health Sciences, Inc., Syneos Health, Inc., Thomson Reuters Corporation and Verisk Analytics, Inc.

Total stockholder return was 29% in 2017, 19% in 2018 and 33% in 2019, resulting in a cumulative three-year return of 103%, more than double the S&P 500 and peer group performance, which delivered cumulative three-year returns of 44% and 45%, respectively. Our three-year performance yielded significant stockholder value creation, as our stock price increased from $76.05 per share on December 31, 2016, representing a market capitalization of approximately $18 billion, to $154.51 per share on December 31, 2019, representing a market capitalization of approximately $30 billion.

The companies in the stock performance peer group are publicly traded information services, information technology or contract research companies, and thus share similar business model characteristics to IQVIA, or provide services to similar customers as IQVIA.

The S&P 500 and the stock performance peer group were included for comparative purposes only. They do not necessarily reflect management’s opinion that the S&P 500 and this peer group are an


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appropriate measure of the relative performance of the stock involved, and they are not intended to forecast or be indicative of possible future performance of our common stock.

This performance graph shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or incorporated by reference into any filing of IQVIA Holdings Inc. under the Exchange Act or under the Securities Act, except as shall be expressly set forth by specific reference in such filing.

2. SOUND PAY PRACTICES

COMPENSATION PHILOSOPHY

Our compensation philosophy for the Company continues to be primarily focused on creating an alignment between executive compensation and business performance by rewarding our executive officers for the achievement of strategic goals that are intended to contribute to long-term stockholder value. We emphasize performance-based, variable compensation over fixed compensation.

Principal Objectives. Our executive team is critical to our success and to building value for our stockholders. Our executive compensation program is designed to:

 

 

Attract and retain experienced and well-qualified executives to serve in leadership positions and to lead our organization over the long term

 

 

Motivate our executives to succeed by providing compensation that is directly linked to both our short- and long-term performance

 

 

Align the interests of our executive officers with those of our stockholders by delivering a substantial portion of the executive officer’s compensation through time- and performance-based equity awards and through the use of share ownership guidelines

 

 

Ensure that our executive compensation program is designed and administered in a manner that appropriately manages risk to safeguard the interest of our stockholders, as well as our employees

We have designed our executive compensation program with specific features to help achieve these goals and to promote related objectives that are important to our long-term success.

Compensation and governance practices. Below we highlight certain of our key practices that we consider good governance features of our executive compensation program.

 

WHAT WE DO

 

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Align executive pay with performance

 

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Set challenging performance objectives for our named executive officers

 

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Appropriately balance short- and long-term incentives

 

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Align executive compensation with stockholder returns through performance-based long-term incentive awards

 

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Use multi-year vesting requirements for long-term incentive awards

 

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Implement meaningful share ownership guidelines

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Annual named executive officer performance evaluation by the LDC Committee

 

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Robust clawback policy in place for our cash and equity incentive compensation for financial restatements

 

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Include non-solicitation and non-competition provisions in awards agreements

 

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Conduct an annual compensation risk review and assessment

 

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Utilize expertise of an independent compensation consultant

 


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WHAT WE DON’T DO

 

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No contracts with multi-year guaranteed salary increases or non-performance bonus arrangements

 

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No excise tax gross-ups

 

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No single trigger equity vesting

 

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No repricing of underwater stock options or SARs without stockholder approval

 

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No payment of unearned dividends prior to vesting

 

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No hedging or pledging of Company shares

 

 

Performance metrics. Our executive compensation program ties a substantial portion of each named executive officer’s compensation to the achievement of performance objectives over both the short- and long-term, as described in further detail below. For 2019, 86.8% of our Chief Executive Officer’s total compensation was performance-linked and, on average, 74.5% of our other named executives officers’ compensation was performance-linked. We believe this approach to compensation demonstrates our “pay for performance” philosophy as well as our focus on creating longer-term value for our stockholders.

OVERVIEW OF OUR EXECUTIVE COMPENSATION PROGRAM

Roles of the LDC Committee, the Board and management in compensation decisions. Our executive compensation program is developed and overseen by the LDC Committee. The LDC Committee consults with and takes into account the views and recommendations of management, including those of our Chief Executive Officer and our Chief Human Resources Officer, in making decisions regarding our executive compensation program. Our Chief Executive Officer makes recommendations about annual base salary increases, annual cash incentive targets and payments and long-term incentive grants for our named executive officers (other than for himself). The LDC Committee is responsible for approving (or recommending for approval to the Board, in the case of the compensation of our Chief Executive Officer) the long-term incentive awards and the compensation of our named executive officers.

Use of compensation consultants. The LDC Committee uses an external compensation consultant to provide it with objective analysis, advice and information, including competitive market data and compensation recommendations related to the compensation of our named executive officers. While the external compensation consultant may make recommendations on the form and amount of compensation delivered, the LDC Committee (or the Board as described above) makes all decisions regarding the compensation of our named executive officers.

The LDC Committee is solely responsible for approving payments to the external compensation consultant and for setting the terms and scope of the external compensation consultant’s engagement and the termination of this engagement. The external compensation consultant reports directly to the LDC Committee. The external compensation consultant provides only executive and non-employee director compensation consulting services to us and does not provide other services such as benefits administration or actuarial services.

After consideration of the independence assessment factors provided under the listing rules of the NYSE, the LDC Committee determined that the external compensation consultant was independent and that the work it performed during 2019 did not raise any conflicts of interest.

Benchmarking. The LDC Committee works with our external compensation consultant to better understand and continually monitor market competitive pay practices, which it then considers when determining compensation adjustments and changes for the coming year. This annual process includes reviewing our identified peer group and conducting a competitive market benchmark analysis of senior officer roles.


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Review of Peer Companies. The LDC Committee targets total compensation opportunities for our named executive officers, other than our Chief Executive Officer, at or near the median of our peer group and/or market survey group. When reviewing the compensation opportunities for our Chief Executive Officer, the LDC Committee considers the compensation of chief executive officers at public companies outside of the peer group described below, including significantly larger companies, which the LDC Committee believes are realistic competitors for his services. The LDC Committee considers comparisons to compensation levels at other companies to be helpful in assessing the overall competitiveness of our compensation practices but places a greater emphasis on overall compensation opportunities rather than on setting each element of compensation at or near the median for that element.

The composition of our peer group reflects a mix of both industry and non-industry peers. These companies are ones with whom we compete for executive talent, or which are broadly similar to us based on certain characteristics, such as: financial size and performance as measured by revenue, capitalization, returns, growth and/or profitability; industry focus; scope of operations; employee base and market presence outside the United States; and organizational complexity. The peer companies, when selected, had annual revenues ranging from 0.5 times to 2.5 times our revenues. The LDC Committee worked with the external compensation consultant in 2019 to review our peer group for its continued appropriateness. Based on discussions with, and recommendations from, our external compensation consultant, the LDC Committee decided, after a full evaluation, to update the peer group as follows in 2019:

 

Added   Removed

 

Bausch Health Companies Inc.

 

 

Agilent Technologies, Inc.

 

Boston Scientific Corporation

 

 

Cerner Corp.

 

Regeneron Pharmaceuticals, Inc.

 

 

Perrigo Co. Plc.

   

 

Science Applications International Corp.

The comparator companies that were removed were done so because their revenues fall below the targeted range of our revenue. The updated peer group is as follows:

 

     
     Allergan plc

 

  Bausch Health Companies Inc.

 

  Boston Scientific Corporation

 

     Cognizant Technology Solutions Corp.

 

  Fiserv, Inc.

 

  Laboratory Corp of America Holdings

 

     Nielsen Holdings PLC

 

  Quest Diagnostics, Inc.

 

  Regeneron Pharmaceuticals, Inc.

 

     salesforce.com, inc.

 

  S&P Global, Inc.

 

  Thomson Reuters Corp.

 

Review of Market Survey Data. The LDC Committee also considered market survey data when determining the elements and amount of total direct compensation for our named executive officers, other than our Chief Executive Officer, whose base salary and annual incentive target were established pursuant to his employment agreement.

The market survey data reviewed consisted of surveys of executive compensation data from public and private companies across all sectors with similar qualifications as we use to determine peer companies. The external compensation consultant prepared analyses of this survey data at the direction of the LDC Committee for its review and consideration. For positions where peer group and market survey data were available, the peer group and market survey data were averaged to provide a market composite perspective of compensation levels of such positions. We also reviewed peer group data to assess competitive executive incentive compensation programs, practices and long-term incentive award levels.

Non-Binding Company Grant Guidelines. For 2019, long-term incentive awards were determined in part based on non-binding Company grant guidelines developed using peer group and market survey


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data of the type described above. These guidelines, which are reviewed on an annual basis, cover employees at each of our senior executive levels, including our named executive officers, other than our Chief Executive Officer, and set forth proposed long-term target award values for each job level, which were established taking into account peer group and market survey data on target equity award values for employees with similar salaries and positions.

ELEMENTS OF COMPENSATION

As described in more detail below, the primary elements of our 2019 executive compensation program include:

 

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Together, these items are intended to be complementary and serve the goals described above. The LDC Committee, however, does not have any formal policies or guidelines for allocating compensation between short- and long-term compensation, between cash and non-cash compensation or among different forms of cash and non-cash compensation. The following is a discussion of the primary elements of compensation for each of our named executive officers.

Base Salary. The purpose of base salary is to:

 

 

provide financial predictability and stability through fixed compensation that is less than a majority of total direct compensation at target for the named executive officers

 

 

provide fixed compensation that will attract new executives and retain our existing executives with market competitive salaries

 

 

provide fixed compensation that reflects the scope, scale and complexity of the executive role

Annual base salaries of our named executive officers may be adjusted by the LDC Committee based upon the recommendations of our Chief Executive Officer (except with respect to his own salary) as well as market benchmarking data and analysis provided by the external compensation consultant. The recommendations made with respect to a named executive officer are generally based upon the executive’s individual annual performance review for the prior year’s performance, leadership and contribution to Company performance, as well as market conditions, peer group and/or market survey data and our overall budgetary guidelines.

The LDC Committee takes all of these factors into account when making its decisions but does not assign a specific or pre-determined weight to any one factor. In addition to the annual salary review, the LDC Committee may also adjust base salaries during the year in connection with promotions, increases in responsibilities or to maintain competitiveness in the market.

Short-Term Incentive Awards.

General. We do not follow a formulaic approach in determining the short-term incentive awards paid to our named executive officers under our annual incentive plan (the “Annual Plan”). Over the last several years since the Merger, we have been engaged in a strategic transformation of our business to a leading global provider of advanced analytics, technology solutions, and contract research services to the life sciences industry. To achieve our short- and long-term financial, operational and strategic objectives and to continue our growth trajectory, we believe it is necessary to evaluate a variety of qualitative and quantitative factors to assess achievement. We believe payouts under our Annual Plan are closely aligned with Company performance and that the LDC Committee should have flexibility in making compensation decisions for our named executive officers based on their individual contributions to the Company’s performance.


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Financial Performance Targets. The LDC Committee reviews and establishes performance targets to motivate our named executive officers to deliver a high degree of financial and operational performance without encouraging excessive risk-taking. Early each year, the LDC Committee establishes threshold performance goals under the Annual Plan. After the end of the fiscal year, the LDC Committee determines whether Company performance merits payouts of short-term incentive awards under the Annual Plan based on its review of the Company’s achievement against pre-determined Revenue and Adjusted EBITDA goals for the Company as a whole. If actual Revenue or Adjusted EBITDA achievement is less than the threshold amount, the Annual Plan does not allow short-term incentive awards to be paid to our named executive officers. The relative contribution of each financial performance metric is as follows:

 

Financial Performance

Metric

   Description and Reason Selected

“Revenue”

 

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  “Revenue” is defined as the Company’s revenue from its Consolidated Statements of Income

 

  The LDC Committee believes that Revenue is a key driver of stockholder value and earnings growth over time, and bases a portion of its determination on making short-term incentive awards to our named executive officers on the achievement of Revenue goals

 

“Adjusted EBITDA”

 

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  “Adjusted EBITDA” is defined as the Company’s net income or loss from our Consolidated Statements of Income before interest income and expense, income taxes, depreciation and amortization, and as further adjusted to eliminate restructuring and related charges, income from non-controlling interests, stock-based compensation, acquisition related charges, deferred revenue purchase accounting adjustments, loss on extinguishment of debt, integration related costs and other expense. This definition is the same, and reconciled back to the nearest comparable GAAP financial measure in the exact same manner, as Adjusted EBITDA included in the Company’s earnings releases

 

  The LDC Committee believes that Adjusted EBITDA is an important measure of financial performance and the ability to service debt and reflects our near- and longer-term goal of increasing profitability, and bases a portion of its determination on making short-term incentive awards to our named executive officers on the achievement of Adjusted EBITDA goals

Individual Performance Evaluation. At the beginning of each fiscal year, each named executive officer meets with our Chief Executive Officer (or, in the case of our Chief Executive Officer, with the LDC Committee) to discuss his individual performance goals for the year. Each named executive officer’s individual performance goals are developed in consultation with our Chief Executive Officer for review with the LDC Committee and consist of a series of key pre-established strategic, financial, operational and/or leadership objectives, among others, that relate to the duties of the named executive officer in support of the business objectives for the fiscal year.

If amounts are allocated to the Annual Plan, for each named executive officer, the LDC Committee and our Chief Executive Officer (except with respect to his own individual performance goals) evaluate the named executive officer’s actual individual performance, including achievement against a substantial number of pre-established quantitative factors as well as sustainability and corporate citizenship factors, including those set forth in the table below, in determining a named executive officer’s annual short-term incentive award under the Annual Plan. Depending on the named executive officer’s individual performance level, his annual short-term incentive payout range will be from 0% to 200% of his target annual short-term incentive based on assessment of performance versus individual objectives.


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Factors Considered for Individual Short-Term Incentive Compensation Awards for our Named Executive Officers

 

Measured Achievements Against Goals   Other Factors

  Net new business

 

  Customer satisfaction scores

 

  Customer wins/losses

 

  Quality Scores

 

  Market gains/losses

 

  Free cash flow performance

 

  Contribution to our business results and strategic objectives

 

  Contribution to the individual’s respective business unit or function

 

  Contribution to sustainability and corporate citizenship goals

 

  Performance of the individual’s respective business unit or function

 

  Market compensation levels for the respective individual’s role

 

The key individual performance goals for each of our named executive officers in 2019, along with an assessment of the level of achievement for each of our named executive officers, are discussed below under the section entitled “—2019 Short-Term Incentive Awards—Goal Achievement”. We consider the specific metrics used to determine each of our named executive officer’s annual incentive awards to be confidential, commercially-sensitive information, and that their disclosure would result in competitive harm to the Company.

Long-Term Incentive Awards. We believe that substantial long-term returns for our stockholders are achieved through a culture that focuses on long-term performance by our named executive officers and other senior management. By providing our senior management with a meaningful equity stake in the Company, we are better able to align their interests with and create value for our stockholders.

In 2019, our annual grant of long-term incentive awards to our named executive officers under our 2017 Incentive and Stock Award Plan (the “2017 Plan”) consisted of a combination of stock appreciation rights (“SARs”), which only have value if our stock price increases from the date of grant and vest based on continued service, and performance shares, which are earned based on Company achievement of Relative TSR and Adjusted Diluted EPS performance goals, as described in the table below.

The LDC Committee believes that SARs reinforce our goal of retaining key executives while incentivizing the creation of value for our stockholders. The SARs granted to our named executive officers in 2019 will vest as to one-third of the underlying shares on each of the first three anniversaries of the grant date, generally subject to the named executive officer’s continued service with the Company through the applicable vesting dates.


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We believe that performance shares encourage our named executive officers to achieve key strategic objectives and maximize value creation for our stockholders. The performance shares granted to our named executive officers in 2019 will be earned based on our financial results over the three-year period from January 1, 2019 through December 31, 2021 using a weighted combination of the following performance metrics:

 

Performance Metric

   Description and Reason Selected

 

Relative “Total Stockholder Return” or “TSR”

 

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  “Relative TSR” or “TSR” is a measure of the Company’s stockholder value creation relative to a peer group over time. It combines share price appreciation and dividends, if any, paid to show the total return to the shareholder expressed as an annualized percentage

 

  The LDC Committee views this metric as closely correlated with long-term returns to stockholders and ties 25% of the vesting of performance shares to achievement of Relative TSR goals

 

“Adjusted Diluted EPS”

 

LOGO

 

  

 

  “Adjusted Diluted EPS” means, with respect to each fiscal year during the performance period, our earnings per share, as reported, excluding, all adjustments made to Net income or loss from our Consolidated Statements of Income to arrive at Adjusted EBITDA with the exception of interest expense and depreciation and amortization as well as incremental adjustments for purchase accounting amortization and royalty hedge gain (loss) and any extraordinary nonrecurring items. This definition is the same, and reconciled back to the nearest comparable GAAP financial measure in the exact same manner, as Adjusted Diluted EPS included in the Company’s earnings releases

 

  The LDC Committee believes it is an important measure of our goal of increasing profitability and ties 75% of the vesting of performance shares to achievement of Adjusted Diluted EPS goals

The Adjusted Diluted EPS goal is based on our three-year Adjusted Diluted EPS growth and is subject to adjustment based upon the occurrence of certain corporate events in accordance with the 2017 Plan and may be subject to such other adjustments for material or non-recurring events occurring during the relevant fiscal year as determined by the LDC Committee in its sole discretion. Our Relative TSR goal for the 2019 performance shares is based on our three-year total stockholder return performance as compared to the total stockholder return performance of the S&P 500 Index.

The LDC Committee considers a number of factors in determining the long-term incentive award grants to our named executive officers, including the Company’s non-binding grant guidelines, including a review of market survey data as described above, the retentive value of remaining unvested long-term incentive awards, individual performance evaluations, and the performance objectives of each named executive officer. The number of performance shares that may be earned ranges from 0% of the named executive officer’s target award, if the threshold levels of performance are not achieved, to 200% of the target award, if the maximum levels are achieved or exceeded.

Each earned and vested performance share will be settled by delivery of one share of our common stock.

Under the terms of the applicable award agreements, our named executive officers must remain employed through the end of the performance period in order to receive payment from any earned performance shares.

The LDC Committee’s determinations with respect to long-term incentive award grants to our named executive officers during 2019 are discussed below under the section entitled “—2019 Long-Term Incentive Awards”.


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RETIREMENT, PERQUISITES AND TERMINATION BENEFITS

Retirement Plans. We believe that our retirement plans serve as an important tool to attract and retain our named executive officers and other key employees, and that we would be at a competitive disadvantage if we did not offer attractive retirement plans. We also believe that offering a baseline of stable retirement benefits encourages our named executive officers to make a long-term commitment to us. Consistent with our understanding of competitive market practice, we do not adjust the level of retirement plan benefits based on the value of a named executive officer’s long-term incentive awards nor do we adjust the level of a named executive officer’s total direct compensation for a given year in light of the value of retirement benefits.

The summaries below of each of our retirement plans should be read in conjunction with the tables, and related footnotes, under the sections entitled “Compensation of Named Executive Officers—Pension Benefits,” “—Defined Benefit Retirement Plans” and “—Non-qualified Deferred Compensation,” which provide more detail on the retirement benefits and deferred compensation values, if any, for each of our named executive officers.

 

Plan

  

Description

 

IMS Health Retirement Plan

  

 

U.S.-based legacy IMS Health employees, including our Chief Executive Officer and Mr. Knightly, are eligible to participate in this tax-qualified defined benefit pension plan with a cash balance formula. Effective December 31, 2016, this plan was closed to new participants.

 

IMS Health Retirement Excess Plan

  

 

Certain U.S.-based legacy IMS Health employees, including our Chief Executive Officer and Mr. Knightly, are eligible to participate in this unfunded, non-qualified retirement plan utilizing the same benefit formula, compensation recognition, retirement eligibility and vesting provisions as the tax-qualified IMS Health Retirement Plan. It provides pension benefits not provided by the IMS Health Retirement Plan due to Internal Revenue Code limits. Effective December 31, 2016, this plan was closed to new participants.

 

IMS Health Defined Contribution Executive Retirement Plan

  

 

Certain U.S.-based legacy IMS Health employees are eligible to participate in the unfunded, non-qualified defined contribution plan that was frozen to new participants and accruals as of June 30, 2012. Mr. Knightly is the only named executive officer who participates in this plan.

 

IQVIA 401(k) Plan

  

 

U.S.-based employees, including our named executive officers, are eligible to participate in this tax-qualified, defined contribution plan. Employees may contribute a portion of their compensation to this plan and receive a matching Company contribution. Under the IQVIA 401(k) Plan, for 2019, our discretionary matching contribution matched the first 3% of employee contributions at 100% and the next 3% of contributions at 50% (subject to Internal Revenue Code limitations); however, for those employees eligible to participate in the IMS Health Retirement Plan, our discretionary matching contribution matched 50% of employee contributions up to 6% of compensation (subject to Internal Revenue Code limitations).

 

IQVIA Savings Equalization Plan

  

 

Certain U.S.-based employees, including our named executive officers, are eligible to participate in this unfunded, non-qualified defined contribution plan using the same benefit formula as in the IQVIA 401(k) Plan. It provides a Company matching contribution not provided by the tax-qualified IQVIA 401(k) Plan due to Internal Revenue Code limits.

 

IQVIA Elective Deferred Compensation Plan

  

 

Certain U.S. based employees, including our named executive officers, are eligible to participate in this elective non-qualified deferred compensation plan. The plan allows eligible employees to defer up to 80% of their base salaries as of the first day of the calendar year or partial year and up to 100% of short-term incentive awards earned under the Annual Plan payable to the participant with respect to that year. Contributions consist solely of participants’ elective deferral contributions with no matching or other employer contributions. None of our named executive officers participated in this plan in 2019.


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Termination Benefits. We provide severance, change of control and retirement protections to our Chief Executive Officer pursuant to his employment agreement. Messrs. McDonnell and Staub have severance protection in their respective employment arrangements. Messrs. Knightly, Sherbet and Mr. McDonnell except for salary continuation benefits, have severance protection through our Employee Protection Plan. These employment agreements and plans are summarized below under “—Potential Payments upon Termination or Change in Control” below. Our severance and change in control protections are designed to be fair and competitive to aid in attracting and retaining experienced executives, including our named executive officers. We believe the protection we provide, including the level of severance payments, post-termination benefits and our limited change in control benefits, is appropriate and within the range of competitive practice.

The provisions of our employment agreements, plans and other compensation arrangements do not provide for any excise tax gross-up payment to our named executive officers. Any taxes, including golden parachute excise taxes, resulting from severance or any other change in control related compensation are the responsibility of the executive.

Perquisites. For other elements of compensation provided to our named executive officers, such as perquisites and health and welfare benefits, the LDC Committee provides competitive benefits. The LDC Committee considers the views and experiences of the external compensation consultant on these matters. The LDC Committee believes that perquisites should not constitute a significant part of our executive compensation program but does provide certain perquisites to our named executive officers on an individual basis as deemed appropriate and reasonable by the LDC Committee. The perquisites provided to our named executive officers in 2019 are summarized below under “—Perquisites” and reported in the “Summary Compensation Table”.


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3. DISCIPLINED ASSESSMENT TO DETERMINE PAY

2019 NAMED EXECUTIVE OFFICERS

Throughout this Compensation Discussion and Analysis, we focus on our named executive officers, which are listed in the “Summary Compensation Table” below and the other compensation tables included in this Proxy Statement. For 2019, the following individuals were our named executive officers:

 

Name          Age      Current Position

LOGO

 

   Ari Bousbib    58      Chairman, Chief Executive Officer and President

LOGO

 

   Michael R. McDonnell    56      Executive Vice President and Chief Financial Officer

LOGO

 

   W. Richard Staub, III    57      President, Research & Development Solutions

LOGO

 

   Kevin C. Knightly    59      President, Technology & Commercial Solutions

LOGO

 

   Eric M. Sherbet    55      Executive Vice President, General Counsel and Secretary

2019 COMPENSATION DETERMINATIONS

Below we discuss the LDC Committee’s key compensation decisions in setting 2019 salary, short- and long-term incentives, which were made based on the process and evaluation described under “Sound Pay Practices” and with advice from our Chief Executive Officer (except with respect to his own compensation) and our external compensation consultant (see “—Overview of our Executive Compensation Program—Use of compensation consultants”). When making compensation decisions, the LDC Committee considered such factors as relevant benchmarking data, the experience and length of service of the named executive officer, relative responsibilities among members of our executive team, contributions by the named executive officer against a series of established strategic, financial, operational and/or leadership objectives that relate to the duties of the named executive officer and business conditions.

2019 AMENDMENT TO CHIEF EXECUTIVE OFFICER’S EMPLOYMENT AGREEMENT

In February 2019, the LDC Committee recommended, and the Board approved, an amendment and restatement to our Chief Executive Officer’s employment agreement, replacing and superseding his existing employment agreement, which had last been amended and restated in July 2018. The new


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employment agreement increased our Chief Executive Officer’s annual base salary, which had not been increased since 2014, to $1.7 million per year from $1.6 million per year, subject to annual review, provided for any outstanding long-term incentive awards granted to him after July 2018 to remain outstanding and eligible for continued vesting, subject to certain limitations, in the event of his permanent retirement from the Company, and otherwise preserved the terms and conditions under his existing employment agreement. These changes to our Chief Executive Officer’s employment agreement were made by the LDC Committee based on feedback from the external compensation consultant on market practices. The long-term incentive awards granted to the Chief Executive Officer in 2019 included vesting terms consistent with the terms provided in his employment agreement, including the amendments made in 2019. The material terms of our Chief Executive Officer’s employment agreement are set forth in the narrative disclosure that follows the “Summary Compensation Table” and under the section entitled “—Potential Payments Upon Termination or Change in Control” below.

2019 BASE SALARY

The amount of our Chief Executive Officer’s annual base salary is set forth in his employment agreement, but it remains subject to increase based on the same factors as described above for the other named executive officers.

As discussed above, LDC Committee approved an amendment and restatement of the Chief Executive Officer’s employment agreement in 2019, which provided for, among other things, an increase to his annual base salary in February 2019, the first such increase to his annual base salary since 2014. The LDC Committee also approved an increase to our other named executive officer’s base salaries for 2019 based on internal pay equity considerations, including named executive officer performance, leadership and scope of responsibility, and a review of the competitive market data. The following table sets forth the annual base salaries for each named executive officer.

 

Named Executive Officer

   2019 Base Salary1  
Ari Bousbib                $ 1,700,000  
Michael R. McDonnell                $ 670,000  
W. Richard Staub, III                $ 605,000  
Kevin C. Knightly                $ 550,000  

Eric M. Sherbet

               $ 525,000  

 

1 

Our Chief Executive Officer’s base salary increase, which was the first increase in his base salary since 2014, was effective February 13, 2019 upon the execution of our Chief Executive Officer’s amended and restated employment agreement. The other named executive officer’s base salary increases were effective July 1, 2019 following the annual merit review cycle. Base salaries reflect the annualized salaries approved by the LDC Committee.

2019 SHORT-TERM INCENTIVE AWARDS

Key Factors in Determining Level of Achievement. As set forth above, early each year, the LDC Committee establishes threshold performance-based goals under the Annual Plan. If the threshold level of performance is achieved, payouts of short-term incentive awards will be eligible under the Annual Plan. The pre-established Revenue and Adjusted EBITDA threshold targets for 2019 were $9.361 billion and $2.040 billion, respectively.

The LDC Committee reviewed the Company’s achievement against these pre-established Revenue and Adjusted EBITDA goals and it was determined that the Company had exceeded the threshold level of performance, which supported the payment of short-term incentive awards. 2019 Revenue was $11.088 billion and Adjusted EBITDA was $2.400 billion against threshold performance goals of


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$9.361 billion and $2.040 billion, respectively. The LDC Committee then evaluated several other quantitative and non-quantitative factors, also described above, to determine individual awards under the Annual Plan.

The LDC Committee then conducted a detailed review consistent with the process and factors set forth under “Sound Pay Practices—Individual Performance Evaluation,” including a review of each named executive officer’s achievement against his pre-established objectives to determine each named executive officers’ annual short-term incentive award.

Goal Achievement. The following table lists certain key pre-established 2019 strategic, financial, operational and/or leadership goals for each of our named executive officers and detailed achievement against those goals used to determine their annual incentive awards. We consider the specific metrics used to determine our named executive officer’s annual incentive awards to be confidential, commercially-sensitive information, and their disclosure would result in competitive harm to the Company.


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Ari Bousbib

Chairman and Chief Executive Officer

Goals

     

Achievements

 

Achievement of certain key financial targets for:

 

  Revenue

 

  Adjusted EBITDA

 

  Adjusted Diluted EPS targets

 

     

 

Strong overall financial performance for 2019 that significantly exceeded the target for each goal and resulted in meeting or exceeding guidance and consensus results for Revenue, Adjusted EBITDA and Adjusted Diluted EPS each quarter and for the fiscal year, including following an increase in full-year revenue constant currency revenue growth guidance in July 2019

 

Execute capital allocation strategy, including achieving certain targets for:

 

  Cash repatriation

 

  Share repurchase

 

  Acquisitions

 

  Decrease average interest expense

     

 

Successfully executed capital allocation strategy, which included:

 

  Repatriation of $1.1 billion in cash to the U.S., which significantly exceeded the target for this goal

 

  The repurchase of 6.6 million shares of common stock, which significantly exceeded the target for this goal

 

  Execution of our acquisition and investment strategy, with a total of $1.2 billion in net cash deployed in 2019, which exceeded the target for this goal

 

  Two note issuances, to extend maturities and reduce our cost of debt, and the repricing of certain credit facility indebtedness, resulting in a reduced after-tax average cost of debt of 3.1% exiting 2019, compared to 3.5% exiting 2018, which significantly exceeded the target for this goal

 

Deliver continued value to stockholders through:

 

  Achievement of certain total stockholder return goals and

 

  Effective representation of the Company with the investor community

 

     

 

Strong stock price performance in 2019, achieving 33% total stockholder return for the Company versus 28.9% for the S&P 500 (assuming the reinvestments of dividends, if any), which significantly exceeded the target for this goal

 

Hosted Financial Analyst and Investor Conference and clearly communicated the Company’s Vision 2022 strategy initiative and new three-year savings targets

 

Met with 95 unique investor funds to provide updates on the Company’s progress

 

Achieved four sell-side analyst upgrades/initiations, all to “Buy” ratings; no downgrades

 

Recognized by Institutional Investor as 2019 Best CEO in Healthcare Technology and Distribution (buy-side)

 

Execute strategy to drive transformation of the Company to an analytics- and technology-driven services focused company, including achieving specific targets for:

 

  OCE customer wins

 

  Growth in our technology business

 

     

 

Executed technology product strategy resulting in 50 customer awards for the OCE platform, versus 30 in 2018, the first full year since product launch, which significantly exceeded the target for this goal

 

Technology and Analytics Solutions growth of 10.7% at constant foreign currency exchange rates, which significantly exceeded the target for this goal

 

Created Artificial Intelligence / Machine Learning Global Council to govern use of AI/ML in external facing offerings and internal use; received 2019 Fierce Innovation Award for use of Natural Language Processing Platform in AI/ML solutions

 

Launched Human Data Science Cloud providing a single platform for the aggregation and transformation of data for effective and efficient application of artificial intelligence capabilities


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Goals

     

Achievements

 

Achieve certain growth and new business targets for Research and Development Solutions:

 

  Revenue

 

  Contracted services net new business

 

  New customers

 

  New preferred providers

     

 

Research and Development Solutions revenue of $5.8 billion, representing 6.9% year-over year growth at constant foreign currency exchange rates, which significantly exceeded the target for this goal

 

Achieved growth of clinical research contracted services net new business that significantly exceeded the target for this goal and resulted in year-end backlog of $19 billion, which was an all-time high

 

Contracted business with over 250 new customers in the clinical research services space, including with 13 of the top 20 pharmaceutical companies using CORE-powered smart trials, which significantly exceeded the target for this goal

 

Entered into a number of new preferred provider relationships, which significantly exceeded the target for this goal

 

 

Enable growth through Real World Solutions:

 

  Continue data expansion

 

  Market leadership role in Artificial Intelligence

 

  Develop innovative offerings

     

 

Double-digit growth of our Real World Solutions business, which significantly exceeded the target for this goal

 

Recognized as the leader in Real World Data and Real World Evidence Services in 2019 Life Science Strategy Group report

 

Offering developments focused on patient engagement through connected heath and patient engagement portal, which exceeded new business targets

 

 

Achieve specific growth targets for our Contract Sales & Medical Solutions business

     

 

Stabilization of our Contract Sales & Medical Solutions business, which had been declining for 9 consecutive quarters, resulting in growth in revenue of 1.6% at constant foreign currency exchange rates, which significantly exceeded the target for this goal

 

Direct our Merger and investment strategy and achieve Merger-related synergy goal of $200 million in annual run-rate savings at the end of 2019

     

 

Achieved goal of over $200 million in annual run-rate savings, ahead of scheduled timeline

 

Establish Vision 2022 framework and execute global launch of program to drive further cost-savings

     

 

Oversaw strategic planning and implementation process for our Vision 2022, three-year strategy initiative, establishing objectives at enterprise and business unit level targeting $200 million in annual savings; program successfully launched internally and externally

 

Demonstrate commitment to corporate citizenship

     

 

Sponsor of the Company’s Sustainability and Corporate Citizenship program

 

Global implementation of IQVIA day encouraging employees to donate over 28,000 hours to local communities

 

Promoted diversity and inclusion for every employee

 

Recognized by Forbes as one of 2019 America’s Best Employers for Women

 

Recognized by FORTUNE as one of 2019 World’s Most Admired Companies

 

Strengthen the workforce through new development initiatives and recruit new talent to support growth

     

 

Launched Career Site portal, harmonized onboarding program, and implemented uniform rewards and recognition program

 

Talent development and leadership assessments through operating reviews and leadership meetings

 


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Michael R. McDonnell

Executive Vice President and Chief Financial Officer

Goals

     

Achievements

 

Achievement of certain key financial targets for:

 

  Revenue

 

  Adjusted EBITDA

 

  Adjusted Diluted EPS targets

 

     

 

Strong overall financial performance for 2019 that significantly exceeded the target for each goal and resulted in meeting or exceeding guidance and consensus results for Revenue, Adjusted EBITDA and Adjusted Diluted EPS each quarter and for the fiscal year, including following an increase in full-year revenue constant currency revenue growth guidance in July 2019

 

Oversaw the financial planning and reporting process inclusive of the control environment

 

 

Execute capital allocation strategy, including achieving certain targets for:

 

  Cash repatriation

 

  Share repurchase

 

  Acquisitions

 

  Decrease average interest expense

 

     

 

Successfully executed capital allocation strategy, which included:

 

  Repatriation of $1.1 billion in cash to the U.S., which significantly exceeded the target for this goal

 

  The repurchase of 6.6 million shares of common stock, which significantly exceeded the target for this goal

 

  Execution of our acquisition and investment strategy, with a total of $1.2 billion in net cash deployed in 2019, which exceeded the target for this goal

 

  Two note issuances, to extend maturities and reduce our cost of debt, and the repricing of certain credit facility indebtedness, resulting in a reduced after-tax average cost of debt of 3.1% exiting 2019, compared to 3.5% exiting 2018, which significantly exceeded the target for this goal

 

Deliver continued value to stockholders through

 

  achievement of certain total stockholder return goals and

 

  effective representation of the Company with the investor community

 

     

 

Strong stock price performance in 2019, achieving 33% total stockholder return for the Company versus 28.9% for the S&P 500 (assuming the reinvestments of dividends, if any), which significantly exceeded the target for this goal

 

Hosted Financial Analyst and Investor Conference and clearly communicated the Company’s Vision 2022 strategy initiative and new three-year savings targets

 

Achieved four sell-side analyst upgrades/initiations, all to “Buy” ratings; no downgrades

 

Lead our enhanced stockholder engagement program

 

 

Manage our Merger and investment strategy and achieve Merger-related synergy goal of $200 million in annual run-rate savings at the end of 2019

     

 

Achieved goal of over $200 million in annual run-rate savings, ahead of scheduled timeline

 

Develop and retain key talent

     

 

Launched a finance team specific mentoring program

 

Retained 100% of identified key talent, which significantly exceeded the target for this goal

 


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W. Richard Staub, III

President, Research & Development Solutions

Goals

     

Achievements

 

Achievement of certain key financial targets for:

 

  Revenue

 

  Profitability

     

 

Demonstrated strong leadership of Research & Development Solutions global business unit resulting in solid financial performance, including Revenue of $5.8 billion, representing 6.9% year-over year growth at constant foreign currency exchange rates, which significantly exceeded the target for this goal and also resulted in profitability that exceeded the target for that goal

 

 

Create differentiation in the clinical research services space and achieve certain targets for:

 

  Contracted services net new business targets

 

  new and existing customer relationships

 

  new preferred provider targets

     

 

Continued to build on merger thesis by creating differentiation of clinical research services with technology-enabled offerings

 

Achieved growth of clinical research contracted services net new business that significantly exceeded the target for this goal and resulted in year-end backlog of $19 billion, which was an all-time high

 

Contracted business with over 250 new customers in the clinical research services space, including with 13 of the top 20 pharmaceutical companies using CORE-powered smart trials, which significantly exceeded the target for this goal

 

Entered into a number of new preferred provider relationships, which significantly exceeded the target for this goal

 

 

Develop new offerings and pursue business development areas for expansion

     

 

Oversaw offering developments focused on patient engagement via connected heath and patient engagement portal, which exceeded new business targets for these offerings

 

Continued development of Orchestrated Clinical Trial platform with mobile CRA, centralized monitoring and document repository

 

 

Demonstrate improvement in quality and delivery metrics by achieving several specific targets

 

     

 

Achieved significant improvement in operational delivery and quality metrics, which exceeded targets for this goal in many cases

 

Develop and retain key talent

     

 

Launched career paths and mentoring programs for key areas

 

Improved overall attrition rates with higher than target retention of identified key talent

 


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Kevin C. Knightly

President, Technology and Commercial Solutions

Goals

     

Achievements

 

Achievement of certain key financial targets for:

 

  Revenue

 

  Profitability

 

     

 

Demonstrated strong leadership of Technology & Commercial Solutions global business unit resulting in solid financial performance, including revenue growth and profitability that exceeded the target for each goal

 

Execute commercial technology growth strategy, including specific targets for:

 

  OCE Customer wins

 

  Growth in our technology business

 

  Development of new products

     

 

Executed technology product strategy resulting in 50 customer awards for the OCE platform, versus 30 in 2018, the first full year since product launch, which significantly exceeded the target for this goal

 

Technology and Analytics Solutions growth of 10.7% at constant foreign currency exchange rates, which significantly exceeded the target for this goal

 

Launch of Human Data Science Cloud providing a single platform for the aggregation and transformation of data for effective and efficient application of artificial intelligence capabilities

 

Managed the continued development of new technology offerings such as a regulatory and information system, commercial analytics and patient engagement portal

 

 

Lead the stabilization of the Contract Sales & Medical Solutions business

     

 

Demonstrated excellent leadership in the stabilization of our Contract Sales & Medical Solutions business, which had been declining for 9 consecutive quarters, resulting in growth in revenue of 1.6% at constant foreign currency exchange rates, which significantly exceeded the target for this goal

 

 

Pursue business development actions for expansion

     

 

Successfully executed the Technology & Commercial Solutions acquisition strategy, resulting in the expansion of our technology offerings and capabilities

 

 

Develop and retain key talent

     

 

Launched career paths and mentoring programs for key areas

 

Improved overall attrition rates with higher than target retention of identified key talent

 

Eric M. Sherbet

Executive Vice President, General Counsel and Secretary

Goals

     

Achievements

 

Achievement of certain budget goals

 

     

 

Exceeded financial targets for legal function

 

 

Legal guidance and support for Mergers & Acquisitions, securities offerings and litigation matters

     

 

Provided strong legal guidance and support in executing our acquisition and investment strategy, with a total of $1.2 billion in net cash deployed in 2019, allowing us to enhance our capabilities and offerings

 

Oversaw two note issuances, to extend maturities and reduce our cost of debt, and the repricing of certain credit facility indebtedness, resulting in a reduced after-tax average cost of debt of 3.1% exiting 2019, compared to 3.5% exiting 2018

 

 

Effective oversight of our ethics and compliance program

     

 

Demonstrated excellent leadership of our ethics and compliance program, enterprise risk management program, and our Sustainability and Corporate Citizenship program

 

 

Support appropriate Board of Director governance

     

 

Continued service as a trusted advisor to the Board and Chief Executive Officer, with particular focus on corporate governance matters

 

Lead our enhanced stockholder engagement program

 

Oversaw successful onboarding of new board member

 

 

Develop and retain key talent

     

 

Established legal specific communication forums

 

Retained 100% of identified key talent, which significantly exceeded the target for this goal

 


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Target Incentive. Each of our named executive officers was eligible for an annual short-term incentive award in 2019 ranging from 0% to 200% of his target incentive. The target short-term incentive amounts (expressed as a percentage of base salary) for our named executive officers did not change from 2018. The target short-term incentive amount for each of our named executive officers for 2019 under the Annual Plan was as follows:

 

Named Executive Officer

 

  

Target Annual Incentive as a
Percentage of Annual Base Salary

 

 

Ari Bousbib

  

 

200

Michael R. McDonnell

  

 

85

W. Richard Staub, III

  

 

85

Kevin C. Knightly

  

 

85

Eric M. Sherbet

  

 

75

Chief Executive Officer Short-Term Incentive Award Determination. With respect to the determination of our Chief Executive Officer’s annual short-term incentive award, the LDC Committee considered his exceptional performance in defining our strategy and leading the transformation of our business through the now largely-complete Merger integration process and positioning us for future growth, his critical role in the Company’s 2019 performance and the significant progress in executing our technology strategy, when awarding him the short-term incentive award specified in the table below.

More specifically, and as further detailed in the achievement summary of our Chief Executive Officer’s goals above, the Board and the LDC Committee believe that our Chief Executive Officer is exceptional and was critical to the highly successful integration of Quintiles and IMS Health and transformation of our Company since the Merger. The success of the Merger is evidenced by the Company’s achievement and, in many cases, early achievement of its Merger objectives, including achieving our target revenue acceleration of over 200 basis points entering 2019 and achieving over $200 million of run-rate cost savings exiting 2019, and the outstanding financial and total stockholder performance of the Company since the Merger. The LDC Committee believes this success is especially noteworthy given it was not assured at the time of the Merger, as Quintiles and IMS Health were not viewed as natural merger partners and there was significant skepticism of the Merger in some corners of the analyst and investment community. Our Chief Executive Officer has also been essential in our evolution to become the leading global provider of advanced analytics, technology solutions, and contract research services to the life sciences industry. The Board and the LDC Committee believes that this evolution, which is still in process, is fundamental to the long-term success of our Company.

The Board and the LDC Committee believe strongly that our Chief Executive Officer is highly talented and that many larger companies would have a keen interest in recruiting him to serve as chief executive officer, especially in light of the success of the Merger and our subsequent strategic transformation. Accordingly, the Board and the LDC Committee believe that, while compensation of our Chief Executive Officer and other named executive officers is strongly aligned with performance (2019 compensation of our Chief Executive Officer was 86.8% performance-linked), retention of our Chief Executive Officer is imperative to our success as a company and informs the decisions of the Board and our LDC Committee regarding both his annual short-term incentive and long-term incentive awards. Our directors who met with stockholders as part of our 2019 stockholder engagement program communicated this message when reviewing our executive compensation program during these meetings.


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Named Executive Officer Short-Term Incentive Award Determinations. The LDC Committee and our Chief Executive Officer (except with respect to his own individual performance) evaluated the performance of each of our named executive officers as described above and determined their relative levels of achievement at the levels specified below.

 

Named Executive Officer    Short-Term
Incentive Award
     Percentage
of Target
 

Ari Bousbib

  

        $

6,600,000

 

  

 

    195.5%

 

Michael R. McDonnell

  

        $

645,000

 

  

 

    115.0%

 

W. Richard Staub, III

  

        $

720,000

 

  

 

    142.1%

 

Kevin C. Knightly

  

        $

600,000

 

  

 

    130.1%

 

Eric M. Sherbet

  

        $

550,000

 

  

 

    142.4%

 

2019 LONG-TERM INCENTIVE AWARDS

Consistent with the process set forth under “Sound Pay Practices,” we provide our named executive officers with long-term incentive awards to promote retention, to incentivize sustainable growth and long-term value creation, and to further align the interests of our executives with those of our stockholders during the vesting periods. The grant date value of long-term incentive awards granted to each named executive officer for a given year is based on an assessment of the individual’s position, role and responsibilities within the Company, the overall competitiveness of his total direct compensation opportunity, internal equity considerations and the current retentive value of the long-term incentive awards that remained unvested for each named executive officer. The LDC Committee also considers compensation peer group and other market data for a general understanding of competitive equity compensation practices and considers the impact of the grants on long-term incentive plan usage and share dilution. Additional information on the equity awards granted to our named executive officers in 2019 is set forth in the tables, and related footnotes, under “Compensation of our Named Executive Officers—2019 Grants of Plan-Based Awards”.

When making long-term incentive awards for fiscal 2019, the LDC Committee first determined the total grant date value of the awards to be granted to each named executive officer and then delivered that value in two components: performance shares representing 50% and SARs representing the remaining 50% of the total grant date value of the award, assuming target level achievement of applicable performance goals for performance shares, as set forth in the table below. The terms of each type of long-term incentive award are set forth above under “Compensation Discussion and Analysis— Disciplined Assessment to Determine Pay—2019 Long-Term Incentive Awards”, which terms are generally applicable to long-term incentive awards granted in fiscal 2019 and in previous fiscal years.

 

Named Executive Officer    Performance Shares      SARs  

Ari Bousbib

  

                $

6,599,377

 

  

$

6,026,709

 

Michael R. McDonnell

  

                $

824,866

 

  

$

753,325

 

W. Richard Staub, III

  

                $

659,961

 

  

$

602,661

 

Kevin C. Knightly

  

                $

659,961

 

  

$

602,661

 

Eric M. Sherbet

  

                $

659,961

 

  

$

602,661

 


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Fiscal 2019 short-term vs. long-term incentive compensation

 

LOGO

Performance Share Determinations. Performance share awards granted to our named executive officers on February 2, 2017 each provided for the grant of shares of our common stock at the end of their performance period based on IQVIA’s achievement of Adjusted Diluted EPS growth and Relative TSR goals, as described above. The three-year performance period for the 2017-2019 performance shares ended on December 31, 2019. The number of performance shares that may be earned ranges from 0% of the named executive officer’s target award, if the threshold levels of performance are not achieved, to 200% of the target award, if the maximum levels are achieved or exceeded. For results between these levels, the number of shares would be determined by interpolation. The performance goals and results used to determine the final payout factor for the 2017-2019 performance period were as follows:

 

Performance Metric   Weight     Threshold     Target     Maximum     Actual     Performance     Payout
Factor
 

3-Year Adjusted Diluted EPS Growth

 

 

75%

 

 

 

6.2%

 

 

 

10.0%

 

 

 

13.5%

 

 

 

17.8%

 

 

200%

 

 

150

3-Year TSR vs. S&P 500 (percentile)

 

 

25%

 

 

 

25   

 

 

 

50   

 

 

 

75   

 

 

 

88   

 

 

200%

 

 

50

                                           

Final Payout

 

 

200

Additional information on the vested value of the performance share awards earned by our named executive officers is set forth in the table and related footnotes below under “Compensation of Named Executive Officers—2019 Option Exercises and Stock Vested”.

PERQUISITES

We provide certain perquisites to our Chief Executive Officer each year pursuant to his employment agreement, all of which are considered compensation and subject to taxes. Our Chief Executive Officer receives reimbursement of reasonable expenses related to home security, financial and estate planning, tax preparation services, and executive physical exams in an annual amount not to exceed $50,000 in the aggregate; use of a Company-leased automobile and reimbursement of all related operating expenses; and personal use of corporate aircraft, subject to the business needs of the Company. We do not provide any tax gross-ups to our Chief Executive Officer in connection with any of these benefits.

In addition, our Chief Financial Officer is entitled to receive reimbursement for the cost of physical exams and related taxes.

We believe the cost of providing such perquisites in 2019 was reasonable and represents a relatively small percentage of the executives’ overall compensation packages.


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4. PAY IS ALIGNED WITH PERFORMANCE

Consideration of Most Recent say-on-pay vote

 

 

     LOGO     

 

  

 

Stockholders showed strong support of our executive compensation program in our last “say-on-pay” vote at our 2017 annual meeting of stockholders with approximately 88% of votes cast in favor of the proposal and elected to hold a “say-on-pay” vote every three years. The next such vote will occur at the 2020 Annual Meeting.

 

The LDC Committee considered the outcome of the most recent say-on-pay vote when making decisions relating to the 2019 compensation of our named executive officers and our executive compensation program. Stockholders showed strong support for our executive compensation program, with approximately 88% of the votes cast for approval of the “say-on-pay” proposal at our 2017 annual meeting of stockholders. The LDC Committee believes that the results of our last say-on-pay vote reflected our stockholder’s satisfaction with the alignment of our named executive officers’ compensation with the Company’s performance and determined not to implement any significant changes to our executive compensation program in 2019 as a result of this vote.

Proposal 2 (page 39) gives our stockholders the opportunity to cast an advisory vote on our executive compensation program as described in this Proxy Statement. Although this vote is non-binding, the LDC Committee will review the results of the vote as it did in 2017 and take those results into account when making future determinations concerning the executive compensation program and policies.

Executive Pay Mix for 2019. As illustrated in the charts below, the vast majority of the targeted mix of compensation for our Chief Executive Officer and other named executive officers for 2019 consisted of variable pay elements. This breakdown directly ties executive pay to our performance, including financial results, strategic initiatives and stock performance. In addition, the LDC Committee believes that a significant percentage of our Chief Executive Officer’s target compensation package should consist of compensation that aligns with our compensation philosophy of appropriately balancing risk and motivating our executive officers to achieve Company performance objectives in the short term and to grow the business to create value for our stockholders over the long term.

 

Chief Executive Officer

 

  

Average of other Named Executive Officers

 

LOGO    LOGO


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Key Features to Align Executive Pay with Stockholder Interests. As illustrated below, we tie our executive compensation program to our long-term business strategy by keeping our executives focused on, and rewarding them for, their achievement of short- and long-term goals that are integral to our strategy.

 

LOGO

 

     
Annual Plan   

  A significant portion of our named executive officer’s individual performance goals, upon which Annual Plan payouts are determined, are tied to one or more of our strategic goals

 

  We link a substantial portion of compensation to corporate performance through our use of achievement of specified Revenue and Adjusted EBITDA goals to determine whether or not annual cash incentive awards will be paid

 

  

Aligns named executive officers with stockholders’ interests by:

 

  Rewarding individual performance for achievement of strategic goals, which are increased each year and designed to position the Company as an industry leader

 

  Incentivizing behavior consistent with strong annual Revenue and Adjusted EBITDA growth

 

Long-Term Incentive Awards   

  We consider individual performance (which is tied to our strategic goals) in setting the value of our named executive officer’s long-term equity grants

 

  We link a substantial portion of compensation to long-term corporate performance through the use of long-term incentives, including performance shares that use Relative TSR and Adjusted Diluted EPS as financial metrics

 

  

Further aligns named executive officer’s interests with stockholders’ interests by:

 

  Taking individual performance (which is tied to our strategic goals) into account in making grants

 

  Linking a substantial portion of long-term compensation to long-term corporate and stock performance

5. RIGOROUS ACCOUNTABILITY, RISK-MITIGATION AND RECOVERY PROVISIONS

Share ownership guidelines. Under our share ownership guidelines established by the LDC Committee, our named executive officers are expected to own shares of our stock with a value equal to at least the following multiples of their annual base salaries:

 

Named Executive Officer    Share  Ownership
Guideline1
    

Ownership Level as
of February 12,  20201

 

Ari Bousbib

  

 

6x

 

  

 

110x

 

Michael R. McDonnell

  

 

3x

 

  

 

5x

 

W. Richard Staub, III

  

 

3x

 

  

 

5x

 

Kevin C. Knightly

  

 

3x

 

  

 

8x

 

Eric M. Sherbet2

  

 

3x

 

  

 

 

 

1 

Represents the applicable multiple of the named executive officer’s annual base salary.

2 

Mr. Sherbet joined IQVIA in March 2018.


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Our share ownership guidelines are designed to increase each named executive officer’s ownership stake in us and align their interests with the interests of our stockholders.

For purposes of the policy, shares are treated as owned if they are owned directly, held through the named executive officer’s account under our retirement plans, or if they are underlying unvested time-based restricted stock unit awards or unvested time-based restricted stock awards. Shares are not counted as owned for purposes of our share ownership guidelines if they are underlying any unvested performance shares or other performance-based awards or underlying any stock option award or stock appreciation rights award, whether or not vested. While there is no set period in which these ownership levels must be met, individuals covered by the guidelines, including our named executive officers, are required to retain at least 50% of the shares, net of applicable tax withholding and payment of exercise price (if applicable), received upon the vesting of long-term incentive awards, or the exercise of stock options or stock appreciation rights, until these share ownership guidelines are met.

Clawback policy. We maintain a formal recoupment, or “clawback,” policy for the recovery of incentive-based compensation paid to current and former executive officers, among others, on the basis of financial results that are subsequently restated as a result of misconduct, material noncompliance with financial reporting requirements under GAAP and SEC rules and in the event of a breach of restrictive covenants. The Board administers this policy with respect to executive officers and has the sole discretion to invoke the policy and direct the Company to recover incentive-based compensation received by such persons on the basis of the restatement or misconduct event.

RISK ASSESSMENT

In designing executive compensation, the LDC Committee seeks to create incentives to promote our long-term business success without encouraging undue risk taking. The LDC Committee has reviewed our compensation programs and has concluded that the risks arising from them are not reasonably likely to have a material adverse effect on us. We do not believe that our compensation programs generally, including the executive compensation program, encourage excessive or inappropriate risk-taking. While appropriate risk-taking is a necessary component of growing a business, the LDC Committee and management have focused on aligning our compensation policies with our long-term interests and avoiding short-term rewards for management and employee decisions that could pose undue long-term risks.

TAX DEDUCTIBILITY

Section 162(m) of the Internal Revenue Code limits the deductibility of compensation paid to certain individuals, including certain current and former executive officers, to $1 million per year. Prior to a change in the tax law in late 2017, certain performance-based compensation awarded or paid by the Company, such as stock appreciation rights and, in some cases, performance shares and annual incentive plan awards, had been eligible to not be limited as to deductibility under such Section 162(m) (if certain requirements had been met). After the change in tax law, as a general matter, all such compensation and other compensation paid to individuals covered by Section 162(m) will be subject to the limitation on deductibility, subject to limited grandfathering exceptions for certain compensation paid pursuant to written binding contracts in effect on November 2, 2017 and not materially modified after such date. The LDC Committee believes that its primary responsibility is to provide an executive compensation program that meets the objectives described above, and that stockholder interests are best served if it retains flexibility and discretion to approve compensation arrangements even if they may not qualify for full or partial tax deductibility and to amend existing arrangements even if such amendment could result in a loss or limitation of deductibility. Therefore, the LDC Committee has approved compensation arrangements for executive officers that did not qualify for full tax deductibility due to Section 162(m) and will continue to do so in the future.


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66   |     IQVIA 2020 PROXY STATEMENT

 

 

 

Compensation Committee Report

The LDC Committee has reviewed and discussed with management the foregoing Compensation Discussion and Analysis. Based on such review and discussions, the LDC Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement and incorporated by reference into our 2019 Annual Report for filing with the SEC.

The Leadership Development and Compensation Committee

Ronald A. Rittenmeyer, Chair

John P. Connaughton

John G. Danhakl

Todd B. Sisitsky


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Compensation of Named Executive Officers

2019 SUMMARY COMPENSATION TABLE

The following table presents summary information regarding the compensation awarded to, earned by, or paid to each of our named executive officers for services rendered to us in all capacities for the fiscal years ended December 31, 2019, 2018, and 2017, if the named executive officer was an executive officer in that fiscal year.

 

Year   

Salary(1)

($)

    

Bonus

($)

    

Stock
Awards(2)

($)

    

Option
Awards(3)

($)

    

Non-Equity
Incentive Plan
Compensation(4)

($)

    

Change in
Pension Value
and Non-
Qualified
Deferred
Compensation
Earnings(5)

($)

    

All Other
Compensation(6)

($)

    

Total

($)

 

Ari Bousbib

 

           

Chairman and Chief Executive Officer

 

 

                                   

 

2019

  

 

 

 

1,684,470

 

 

  

 

 

 

 

 

  

 

 

 

6,599,377

 

 

  

 

 

 

6,026,709

 

 

  

 

 

 

6,600,000

 

 

  

 

 

 

583,877

 

 

  

 

 

 

645,343

 

 

  

 

 

 

22,139,776

 

 

2018

     1,600,000               3,911,254        3,637,456        6,300,000        476,553        536,516        16,461,779  

2017

 

    

 

1,600,000

 

 

 

    

 

 

 

 

    

 

26,391,942

 

 

 

    

 

2,984,594

 

 

 

    

 

6,000,000

 

 

 

    

 

529,625

 

 

 

    

 

523,356

 

 

 

    

 

38,029,517

 

 

 

 

Michael R. McDonnell

 

           

Executive Vice President, Chief Financial Officer

 

 

                                   

 

2019

  

 

 

 

660,000

 

 

  

 

 

 

 

 

  

 

 

 

824,866

 

 

  

 

 

 

753,325

 

 

  

 

 

 

645,000

 

 

  

 

 

 

 

 

  

 

 

 

64,852

 

 

  

 

 

 

2,948,043

 

 

2018

     650,000               651,772        606,223        600,000               58,560        2,566,555  

2017

 

    

 

650,000

 

 

 

    

 

 

 

 

    

 

2,039,988

 

 

 

    

 

497,426

 

 

 

    

 

600,000

 

 

 

    

 

 

 

 

    

 

475,276

 

 

 

    

 

4,262,690

 

 

 

 

W. Richard Staub, III

 

           

President, Research & Development Solutions

 

 

                                   

 

2019

  

 

 

 

596,050

 

 

  

 

 

 

 

 

  

 

 

 

659,961

 

 

  

 

 

 

602,661

 

 

  

 

 

 

720,000

 

 

  

 

 

 

 

 

  

 

 

 

62,487

 

 

  

 

 

 

2,641,159

 

 

2018

     578,550               521,475        484,991        615,000               43,041        2,243,057  

2017

 

    

 

555,000

 

 

 

    

 

 

 

 

    

 

378,058

 

 

 

    

 

348,205

 

 

 

    

 

550,000

 

 

 

    

 

 

 

 

    

 

35,821

 

 

 

    

 

1,867,084

 

 

 

 

Kevin C. Knightly

 

           

President, Technology & Commercial Solutions

 

 

                                   

 

2019

  

 

 

 

542,500

 

 

  

 

 

 

 

 

  

 

 

 

659,961

 

 

  

 

 

 

602,661

 

 

  

 

 

 

600,000

 

 

  

 

 

 

173,261

 

 

  

 

 

 

35,366

 

 

  

 

 

 

2,613,749

 

 

2018

     517,500               521,475        484,991        575,000        57,865        33,351        2,190,182  

2017

 

    

 

487,500

 

 

 

    

 

 

 

 

    

 

378,058

 

 

 

    

 

348,205

 

 

 

    

 

600,000

 

 

 

    

 

144,918

 

 

 

    

 

30,532

 

 

 

    

 

1,989,213

 

 

 

 

Eric M. Sherbet

 

           

Executive Vice President, General Counsel and Secretary

 

 

                          

 

2019

  

 

 

 

515,000

 

 

  

 

 

 

 

 

  

 

 

 

659,961

 

 

  

 

 

 

602,661

 

 

  

 

 

 

550,000

 

 

  

 

 

 

 

 

  

 

 

 

41,537

 

 

  

 

 

 

2,369,159

 

 

2018

 

    

 

415,833

 

 

 

    

 

 

 

 

    

 

294,676

 

 

 

    

 

275,003

 

 

 

    

 

350,000

 

 

 

    

 

 

 

 

    

 

63,939

 

 

 

    

 

1,399,451

 

 

 

 

(1)

Salary information for Mr. Sherbet in 2018 reflects amounts paid since his employment commenced with us on March 1, 2018.

 

(2)

Amounts reflect the aggregate grant date fair value of performance shares (the restricted stock or restricted stock units, as applicable) granted in the relevant fiscal year computed in accordance with Accounting Standards Codification Topic 718, “Compensation—Stock Compensation,” or ASC 718, excluding the impact of estimated forfeitures. Assumptions used in the calculation of these amounts in 2019 are included in Note 17 to our consolidated audited financial statements for the fiscal year ended December 31, 2019 included in Part II of our annual report on Form 10-K. Assumptions used in the calculation of these amounts for 2017 and 2018 are included in Note 19 to our consolidated audited financial statements for the fiscal year ended December 31, 2017 and Note 17 to our consolidated audited financial statements for the fiscal year ended December 31, 2018, respectively. For performance shares granted to our named executive officers in 2019, the amount reported in the table above is based on the probable outcome of the performance conditions associated with the awards as of the grant date. The grant date fair value of the performance shares, made in the form of restricted stock units, granted to each of our named executive officers in 2019 assuming the highest level of achievement of the performance conditions, was $13,198,755 for Mr. Bousbib, $1,649,732 for Mr. McDonnell, $1,319,922 for Mr. Staub, $1,319,922 for Mr. Knightly and $1,319,922 for Mr. Sherbet. For performance shares granted to our named executive officers in 2018, the amount reported in


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  the table above is based on the probable outcome of the performance conditions associated with the awards as of the grant date. The grant date fair value of the performance shares, made in the form of restricted stock units, granted to each of our named executive officers in 2018 assuming the highest level of achievement of the performance conditions, was $7,822,508 for Mr. Bousbib, $1,303,545 for Mr. McDonnell, $1,042,950 for Mr. Staub, $1,042,950 for Mr. Knightly and $589,352 for Mr. Sherbet. The performance share award granted to our Chief Executive Officer in 2017 was made in the form of restricted stock and is reported in the table above assuming maximum performance is achieved, with a grant date fair value of $6,481,084. For performance shares granted to our named executive officers other than our Chief Executive Officer in 2017, the amount reported in the table above is based on the probable outcome of the performance conditions associated with the awards as of the grant date. The grant date fair value of the performance shares, made in the form of restricted stock units, granted to each of our named executive officers in 2017, other than our Chief Executive Officer, assuming the highest level of achievement of the performance conditions, was $1,080,098 for Mr. McDonnell, $756,116 for Mr. Staub, and $756,116 for Mr. Knightly.

 

(3)

Amounts reflect the aggregate grant date fair value for each SAR award granted in the relevant fiscal year as computed in accordance with ASC 718, excluding the impact of estimated forfeitures. Assumptions used in the calculation of these amounts in 2019 are included in Note 17 to our consolidated audited financial statements for the fiscal year ended December 31, 2019 included in Part II of our annual report on Form 10-K. Assumptions used in the calculation of these amounts for 2017 and 2018 are included in Note 19 to our consolidated audited financial statements for the fiscal year ended December 31, 2017 and Note 17 to our consolidated audited financial statements for the fiscal year ended December 31, 2018, respectively.

 

(4)

Amounts for 2019 reflect amounts to be paid in March 2020 under the Annual Plan, as applicable to the named executive officer, as approved by the LDC Committee in February 2020. See “Compensation Discussion and Analysis—Disciplined Assessment to Determine Pay—2019 Short-Term Incentive Awards.” Amounts for 2017 and 2018 represent annual bonuses paid under the annual bonus plan in which the named executive officer was a participant during the applicable fiscal year.

 

(5)

2019 values represent (i) the aggregate change in the present value of each named executive officer’s accumulated benefit under the IMS Health Retirement Plan and Retirement Excess Plan from December 31, 2018 to December 31, 2019 and (ii) interest earned from December 31, 2018 to December 31, 2019 on deferred compensation that is considered “above-market interest” under SEC rules. The change in pension value is broken down below to show the effect of an additional year of service by the named executive officer on the present values versus changes in present value attributable to actuarial assumptions. “Above market interest” is equal to the difference between the interest credited to the cash portion of Mr. Knightly’s account under the IMS Health Defined Contribution Executive Retirement Plan from December 31, 2018 to December 31, 2019 using the interest rate determined under the plan’s provisions (3.44%) and the interest that would have been credited using 120% of the long-term applicable federal rate for December 2019 (or 2.52% using annual compounding). Each of these components is shown in the following table:

 

     Change in Present Value of Pension Benefit         
Name   

Due to additional
accruals

($)

    

Due to change
in actuarial
assumptions

($)

    

Total

($)

    

Above Market
Interest on Deferred
Compensation

($)

 

Ari Bousbib

  

 

533,916

 

  

 

49,961

 

  

 

583,877

 

  

 

 

Kevin C. Knightly

  

 

99,879

 

  

 

63,776

 

  

 

163,655

 

  

 

9,606

 

 

(6)

See below for additional information regarding the amounts disclosed in the “All Other Compensation” column.

2019 ALL OTHER COMPENSATION

The following table details the components of the amounts reflected in the “All Other Compensation” column of the Summary Compensation Table for each of our named executive officers for the fiscal year ended December 31, 2019.

 

Name  

Life
Insurance
Premiums/
Other
Benefits

($)

   

Matching
Contributions
to 401(k)(1)

($)

   

Savings
Equalization
Plan Matching
Contribution(2)

($)

   

Other
Perquisites(3)

($)

   

Total

($)

 

Ari Bousbib

 

 

672

 

 

 

8,400

 

 

 

248,169

 

 

 

388,102

 

 

 

645,343

 

Michael R. McDonnell

 

 

4,902

 

 

 

12,600

 

 

 

47,350

 

 

 

 

 

 

64,852

 

W. Richard Staub, III

 

 

4,902

 

 

 

12,600

 

 

 

44,985

 

 

 

 

 

 

62,487

 

Kevin C. Knightly

 

 

672

 

 

 

7,717

 

 

 

26,977

 

 

 

 

 

 

35,366

 

Eric M. Sherbet

 

 

672

 

 

 

12,600

 

 

 

28,265

 

 

 

 

 

 

41,537

 


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(1)

Represents our matching contributions to the IQVIA 401(k) Plan on behalf of our named executive officers.

 

(2)

Represents certain make-whole plan contributions to the IQVIA Savings Equalization Plan on behalf of our named executive officers equal to the amounts that would have been contributed by us on behalf of each of the named executive officers to the applicable tax-qualified 401(k) plan under the plan’s matching contribution formula if not for certain limits applicable to tax-qualified plans under the Internal Revenue Code.

 

(3)

Amounts in this column for Mr. Bousbib represent reimbursement of estate planning services ($50,000) and the cost to the Company to lease an automobile for Mr. Bousbib and to reimburse him for all operating expenses related to use of the automobile ($30,710). It also includes the aggregate incremental cost for personal aircraft usage ($307,392). For safety, security and productivity reasons, we strongly encourage Mr. Bousbib to use the Company’s aircraft for personal travel. Mr. Bousbib is entitled to use of the corporate aircraft for personal use up to 150 hours per annum, subject to the business needs of the Company. The amount of incremental cost for personal aircraft usage is determined by calculating the hourly variable costs (i.e., fuel, catering, aircraft maintenance, landing and parking fees, crew costs and other miscellaneous costs) for the aircraft, and then multiplying the result by the hours flown for personal use during the year. Incremental cost, if any, of travel by the executive’s family when accompanying the executive is also included.

2019 GRANTS OF PLAN-BASED AWARDS

The following table sets forth information regarding plan-based awards made to each of our named executive officers during 2019.

 

 

 

   

 

     

 

    Estimated Future Payouts Under
Non-Equity Incentive Plan Awards(1)
     

 

   

 

Estimated Future Payouts
Under Equity Incentive Plan
Awards(4)

     

 

   

All Other
Stock
Awards:
Number of
Shares of
Stock

or Units

(#)

   

All Other
Option
Awards:
Number of
Securities
Underlying
Options(5)

(#)

   

Exercise
or Base
Price of
Option
Awards(6)

($)

   

Grant
Date Fair
Value of
Stock and
Option
Awards(7)

($)

 
Name   Grant Date       

 

   

Threshold(2)

($)

   

Target

($)

   

Maximum(3)

($)

      

 

   

Threshold

(#)

   

Target

(#)

   

Maximum

(#)

      

 

 

 

Ari Bousbib

 

 

 

 

 

 

   

 

 

 

 

 

 

 

 

 

3,400,000

 

 

 

 

 

 

6,800,000

 

 

   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

   

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

    2/13/2019                             22,785       45,571       91,142                           6,599,377  
     

 

2/13/2019

 

 

 

           

 

 

 

 

   

 

 

 

 

   

 

 

 

 

           

 

 

 

 

   

 

 

 

 

   

 

 

 

 

           

 

 

 

 

   

 

184,364

 

 

 

   

 

131.82

 

 

 

   

 

6,026,709

 

 

 

 

Michael R. McDonnell