directors, officers, and employees to report all violations of Company policies and applicable law, including incidents of harassment or discrimination. We will take appropriate steps to investigate all such reports and take appropriate action. Under no circumstances will directors, officers, or employees be subject to any disciplinary or retaliatory action for reporting, in good faith, a possible violation of our Code of Conduct or applicable law, or for cooperating in any investigation of a possible violation.
In addition to the ethical obligations set forth in the Code of Conduct, under our Code of Ethics for Senior Financial Management, our CEO, CFO, and senior financial management are required to adhere to the highest standards of honesty, integrity, objectivity, and independence, and comply with all applicable laws, governmental regulations, Company policies, rules and regulations, ethical requirements, and professional standards. They also are responsible for creating and maintaining a culture of high ethical standards and commitment to compliance throughout our Company to ensure the fair and timely reporting of Sherwin-Williams’ financial results and condition. Senior financial management includes our controller, treasurer, principal financial/accounting personnel in our operating groups and divisions, and all other financial/accounting personnel with staff supervision responsibilities in our corporate departments and operating groups and divisions.
Certain Relationships and Transactions with Related Persons
As part of our Code of Conduct, directors, officers, and employees are expected to make business decisions and take actions based upon the best interests of Sherwin-Williams and not based upon personal relationships or benefits.
The Board recognizes that some transactions, arrangements, and relationships present a heightened risk of an actual or perceived conflict of interest and has adopted a written policy governing these transactions. This policy governs any transaction, arrangement, or relationship (or any series of similar transactions, arrangements, or relationships) in which Sherwin-Williams (including any of its subsidiaries) was during the last fiscal year, is, or will be a participant and the amount involved exceeds $120,000, and in which any of the following persons had, has, or will have a direct or indirect material interest (other than solely as a result of being a director or a less than 10% beneficial owner of another entity):
| |
• |
|
our directors, director nominees, or executive officers; |
| |
• |
|
any person who is known to be the beneficial owner of more than 5% of any class of our voting securities; |
| |
• |
|
any immediate family member of any of the foregoing persons; and |
| |
• |
|
any entity in which any of the foregoing persons is employed or is a partner or principal or in a similar position or in which such person has a 10% or greater beneficial ownership interest. |
The Nominating Committee is responsible for reviewing, approving, and overseeing these transactions.
In response to an annual questionnaire, directors, director nominees, and executive officers are required to submit to the Corporate Secretary a description of any ongoing or proposed transactions. Directors and executive officers are expected to provide updates to the list of transactions during the year and submit any newly proposed transactions for review by the Nominating Committee. We will provide any similar information available with respect to any known ongoing or proposed transactions with beneficial owners of 5% or more of our voting securities. At each calendar year’s first regularly scheduled Nominating Committee meeting, management will provide information regarding ongoing transactions and those proposed to be entered into by Sherwin-Williams for that calendar year.
If management becomes aware of any transactions subsequent to that meeting, such transactions will be presented for approval at the next meeting or, in certain circumstances where it is not reasonable or practicable to wait until the next meeting, to the Chair of the Nominating Committee (who possesses delegated authority to act between meetings) subject to ratification by the Nominating Committee at its next meeting. In the event management becomes aware of any transaction that was not previously approved under the policy, management will present the transaction to the Nominating Committee as promptly as practicable for its action, which may include termination, amendment, or ratification of the transaction.
The Nominating Committee (or the Chair) will prohibit a transaction if it is determined to be inconsistent with the interests of Sherwin-Williams and its shareholders and will approve only those transactions that are in, or are not inconsistent with, the interests of Sherwin-Williams and its shareholders, as determined in good faith in accordance with its business judgment. In addition, the transaction must be on terms comparable to those that could be obtained in arm’s length dealings with an unrelated third party.
There were no related person transactions in 2023.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17 |
|
At the Annual Meeting, our management also will report on Sherwin-Williams’ 2023 financial and operating performance and respond to questions from shareholders. We are not aware of any other matters that will be brought before the Annual Meeting for action.
How can I attend and participate in the Annual Meeting?
Virtual Meeting Format. We look forward to welcoming shareholders to the Annual Meeting. This year’s Annual Meeting will be held in a virtual format via webcast. We have designed the virtual Annual Meeting to provide shareholders with substantially the same opportunities to participate as if the Annual Meeting were held in person.
Attendance and Participation. If you were a shareholder at the close of business on the record date, February 20, 2024, you may attend and participate in the Annual Meeting on April 17, 2024 by visiting www.virtualshareholdermeeting.com/SHW2024 and entering the 16-digit control number included on your Notice of Internet Availability of Proxy Materials, proxy card, or voting instruction form. The Annual Meeting will begin promptly at 9:00 a.m. EDT. Online check-in will begin at 8:45 a.m. EDT. Please allow ample time for the online check-in process.
During the Annual Meeting, you may vote and submit questions by following the instructions provided on the meeting website. We will endeavor to answer as many questions submitted by shareholders as time permits. We reserve the right to exclude questions regarding topics that are not pertinent to meeting matters or Company business or that are inappropriate. If we receive substantially similar questions, we may group such questions together and provide a single response to avoid repetition. Any questions that are appropriate and pertinent to the Annual Meeting but cannot be answered during the Annual Meeting due to time constraints will be answered and posted on our Investor Relations website, investors.sherwin.com, as soon as practicable after the Annual Meeting.
No recording of the Annual Meeting is permitted, including audio and video recording. Additional information regarding the rules of conduct for the Annual Meeting and other materials, including the list of our shareholders of record, will be available during the Annual Meeting on the meeting website.
Even if you plan to attend and participate in the Annual Meeting, we encourage you to vote your shares in advance using one of the methods described in this Proxy Statement to confirm your vote will be represented at the Annual Meeting.
The virtual Annual Meeting platform is fully supported across browsers and devices running the most updated version of applicable software and plugins. Attendees should ensure they have a strong Internet connection, allow plenty of time to log in, and can hear streaming audio prior to the start of the Annual Meeting.
Technical Difficulties. If you encounter any difficulties accessing the Annual Meeting during the check-in or meeting time, please call the technical support number that will be posted on the meeting log-in page for assistance. Technical support will be available beginning approximately 15 minutes prior to the start of the Annual Meeting through its conclusion.
Additional information regarding matters addressing technical and logistical issues, including technical support during the Annual Meeting, will be available on the meeting website.
Who is entitled to vote during the Annual Meeting?
You are entitled to vote during the Annual Meeting only if you were a record holder of our common stock at the close of business on the record date, February 20, 2024. At the close of business on the record date, 254,096,725 shares of common stock were outstanding. Each share owned on the record date is entitled to one vote. Beneficial owners of shares held in street name as of the record date may vote as provided below.
What is the difference between a shareholder of record and a beneficial owner of shares held in street name?
Shareholder of Record. If your shares are registered directly in your name with our transfer agent, EQ Shareowner Services, you are considered the shareholder of record with respect to those shares.
Beneficial Owner of Shares Held in Street Name. If your shares are held in an account at a broker, bank, or other similar organization, you are the beneficial owner of shares held in street name. The organization holding your account is considered the shareholder of record, and as a beneficial owner, you have the right to instruct that organization on how to vote the shares held in your account.
How do I vote?
Our shareholders have a choice of voting online, by phone, or by mail in advance of the Annual Meeting or voting online during the Annual Meeting. We encourage you to vote in advance of the Annual Meeting to confirm your vote will be represented at the Annual Meeting.
What vote is required to approve each proposal?
Proposal 1 — Election of 11 Directors. As provided in our Amended and Restated Articles of Incorporation, each of the 11 director nominees who receives a majority of the votes cast will be elected as a member of the Board. A “majority of the votes cast” means that the number of shares voted “for” a nominee’s election exceeds the number of shares voted “against” the nominee’s election. Abstentions and broker non-votes with respect to the election of one or more directors will not be counted as votes cast and, therefore, will have no effect on the vote.
Any incumbent nominee who receives a greater number of “against” votes than “for” votes shall continue to serve on the Board pursuant to Ohio law, but is required to promptly tender his or her resignation for consideration by the Nominating Committee of the Board. We provide more information about majority voting for directors under the heading “Majority Voting for Directors” in the Corporate Governance Practices and Policies section.
Proposal 2 — Advisory Approval of the Compensation of the Named Executive Officers. The approval, on an advisory basis, of the compensation of the named executive officers requires the affirmative vote of a majority of the votes cast. Abstentions and broker non-votes with respect to this proposal will not be counted as votes cast and, therefore, will have no effect on the vote.
Proposal 3 — Ratification of the Appointment of Ernst & Young LLP as Our Independent Registered Public Accounting Firm. The ratification of the appointment of Ernst & Young as our independent registered public accounting firm requires the affirmative vote of a majority of the votes cast. Abstentions with respect to this proposal will not be counted as votes cast and, therefore, will have no effect on the vote. There will not be any broker non-votes with respect to this proposal, as it is considered a routine matter, as described above.
Proposal 4 — Shareholder Proposal to Adopt a Simple Majority Vote. The approval of this shareholder proposal requires the affirmative vote of a majority of the votes cast. Abstentions and broker non-votes with respect to this proposal will not be counted as votes cast and, therefore, will have no effect on the vote.
Other Items. Approval of all other proposals and other business as may properly come before the Annual Meeting requires the affirmative vote of a majority of the votes cast, except as otherwise required by statute or our Amended and Restated Articles of Incorporation or Regulations.
May I revoke or change my vote after I submit my proxy?
Yes. You can revoke or change your vote before the proxy holders vote your shares by timely:
| |
• |
|
giving a revocation to our Corporate Secretary in writing, in a verifiable communication prior to the Annual Meeting; |
| |
• |
|
returning a later signed and dated proxy card or voting instruction form; |
| |
• |
|
entering a new vote online or by phone prior to the Annual Meeting; or |
| |
• |
|
voting online during the Annual Meeting. |
Where will I be able to find voting results of the Annual Meeting?
We intend to announce preliminary voting results at the Annual Meeting and publish final voting results in a Current Report on Form 8-K to be filed with the SEC within four business days after the Annual Meeting.
What constitutes a quorum for the Annual Meeting?
A “quorum” of shareholders is necessary for us to hold a valid Annual Meeting. For a quorum, there must be present, in person or by proxy, shareholders of record entitled to exercise not less than fifty percent of the voting power of Sherwin-Williams. Both abstentions and broker non-votes are counted for the purpose of determining the presence of a quorum.
Who pays the cost of this proxy solicitation?
The enclosed proxy is solicited by the Board, and Sherwin-Williams will pay the entire cost of the solicitation. We retained Georgeson LLC to aid in the solicitation of proxies, for which it will receive a fee of approximately $17,000, plus reasonable expenses.
In addition, we may reimburse brokers, banks, and similar organizations for costs reasonably incurred by them in forwarding proxy materials to beneficial owners of our common stock. Our executive officers and other employees may also solicit the return of proxies. Proxies will be solicited by personal contact, mail, phone, and electronic means.
Shareholder Proposals for the 2025 Annual Meeting
Proposals to Be Included in the Proxy Statement
Under SEC rules, shareholder proposals submitted pursuant to Rule 14a-8 of the Exchange Act must be received at our principal executive offices, 101 West Prospect Avenue, Cleveland, Ohio 44115-1075, Attention: Corporate Secretary, on or before November 6, 2024 in order to be considered for inclusion in the proxy materials relating to the 2025 annual meeting. Upon timely receipt of any such proposal, we will determine whether to include such proposal in the proxy materials in accordance with applicable regulations governing the solicitation of proxies.
If an eligible shareholder, or a group of up to 20 eligible shareholders, desires to have a candidate for election as a director included in the proxy materials (a proxy access nominee) for the 2025 annual meeting, such nomination must conform to the applicable requirements set forth in our Regulations and any applicable SEC regulations concerning the submission and content of proxy access nominations, and must be submitted no earlier than October 7, 2024 and no later than November 6, 2024 to us at our principal executive offices, 101 West Prospect Avenue, Cleveland, Ohio 44115-1075, Attention: Corporate Secretary. Such requirements include, without limitation, providing information about the proposed director nominee and the nominating shareholder that is required to be included in a proxy statement under SEC and NYSE rules, any statement by the nominating shareholder about the proposed director nominee to be included in the proxy statement, and any other information that Sherwin-Williams or the Board requests and determines to include in the proxy statement relating to the proposed director nominee.
Proposals Not to Be Included in the Proxy Statement
Under our Regulations, shareholders must follow certain procedures to nominate a person for election as a director (not including a proxy access nominee) or to introduce an item of business at an annual meeting, which is not intended to be included in our proxy materials. These procedures provide that nominations for director nominees and/or an item of business to be introduced at an annual meeting must be timely submitted in writing to us at our principal executive offices, 101 West Prospect Avenue, Cleveland, Ohio 44115-1075, Attention: Corporate Secretary. In addition, these procedures include, without limitation: providing information about the proposed director nominee specified in the Regulations, including information that would be required to be disclosed in a proxy statement or other filing under Section 14A of the Exchange Act; a description of all direct and indirect compensation and other arrangements between the proposed director nominee and the nominating shareholder; a completed questionnaire with respect to the identity, background, and qualifications of the proposed director nominee; a written agreement from the proposed director nominee that includes a representation that such person, if elected, will serve for the entire term for which he or she is standing for election; and, if applicable, a statement that such shareholder intends to solicit the holders of shares representing at least 67% of the voting power of the Sherwin-Williams’ shares entitled to vote on the election of directors in support of director nominees other than Sherwin-Williams’ nominees.
To be timely, a shareholder’s notice must be delivered to, or mailed and received at, our principal executive offices not fewer than 60 nor more than 90 calendar days prior to the anniversary date of the immediately preceding annual meeting. For the 2025 annual meeting, such notice must be delivered to, or mailed and received at, our principal executive offices no earlier than January 17, 2025 and no later than February 16, 2025. However, in the event that the annual meeting is held on a date more than 30 calendar days before or more than 60 calendar days after the first anniversary of the date on which the prior year’s annual meeting was held, notice by the shareholder, to be timely, must be delivered to, or mailed and received not earlier than the close of business on the 90th day prior to the date of such annual meeting and not later than the close of business on the 60th calendar day prior to such annual meeting or, if the first public announcement of the date of such annual meeting is less than 100 days prior to the date of such annual meeting, the 10th calendar day following the day on which public announcement is first made of the date of the annual meeting.
These time limits also apply in determining whether notice is timely for purposes of SEC rules relating to the exercise of discretionary voting authority. If we do not receive timely notice, or if we meet other SEC requirements, the persons named as proxies in the proxy materials for that meeting will use their discretion in voting at the meeting.
Our Regulations set forth specific, detailed requirements for the notice. You may access a copy of our Regulations on our Investor Relations website, investors.sherwin.com. You may also receive a copy of our Regulations by writing or emailing us at: The Sherwin-Williams Company, 101 West Prospect Avenue, Cleveland, Ohio 44115-1075, Attention: Investor Relations; investor.relations@sherwin.com.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
83 |
|
Pay vs Performance Disclosure - USD ($)
|
12 Months Ended |
Dec. 31, 2023 |
Dec. 31, 2022 |
Dec. 31, 2021 |
Dec. 31, 2020 |
| Pay vs Performance Disclosure |
|
|
|
|
| Pay vs Performance Disclosure, Table |
Pay Versus Performance Table
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
Summary
Compensation
Table Total
for PEO |
|
Compensation
Actually Paid
to PEO |
|
Average Summary Compensation Table Total for Non-PEO NEOs |
|
Actually Paid to Non-PEO NEOs |
|
Value of Initial Fixed $100
Investment Based On: |
|
|
|
|
| |
|
|
Peer Group
Total
Shareholder
Return |
| 2023 |
|
|
$ |
19,281,779 |
|
|
|
|
$38,382,596 |
|
|
|
|
$6,962,401 |
|
|
|
|
$11,841,924 |
|
|
|
$ |
166.24 |
|
|
|
$ |
151.33 |
|
|
|
$ |
2,388,800,000 |
|
|
|
$ |
9.57 |
|
| 2022 |
|
|
|
12,749,910 |
|
|
|
|
(19,713,828 |
) |
|
|
|
3,452,393 |
|
|
|
|
(760,145 |
) |
|
|
|
125.26 |
|
|
|
|
133.55 |
|
|
|
|
2,020,100,000 |
|
|
|
|
7.92 |
|
| 2021 |
|
|
|
15,843,760 |
|
|
|
|
48,088,376 |
|
|
|
|
3,618,848 |
|
|
|
|
8,939,692 |
|
|
|
|
184.10 |
|
|
|
|
171.96 |
|
|
|
|
1,864,400,000 |
|
|
|
|
7.32 |
|
| 2020 |
|
|
|
15,323,284 |
|
|
|
|
34,290,383 |
|
|
|
|
4,096,941 |
|
|
|
|
8,156,681 |
|
|
|
|
127.05 |
|
|
|
|
119.46 |
|
|
|
|
2,030,400,000 |
|
|
|
|
7.36 |
|
1 |
John G. Morikis served as our principal executive officer (“PEO”) for the full year for each of 2023, 2022, 2021, and 2020. Our non-PEO NEOs included: (a) for 2023 and 2022, Allen J. Mistysyn, Heidi G. Petz, Justin T. Binns, and Karl J. Jorgenrud; (b) for 2021, Allen J. Mistysyn, Heidi G. Petz, Mary L. Garceau, Justin T. Binns, and Peter J. Ippolito; and (c) for 2020, Allen J. Mistysyn, Mary L. Garceau, Peter J. Ippolito, and David B. Sewell. |
2 |
For each year, the values included in these columns for the compensation actually paid to our PEO and the average compensation actually paid to our non-PEO NEOs reflect the following adjustments to the values included in columns (b) and (d), respectively: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary Compensation Table (“SCT”) Total for PEO (column (b)) |
|
|
$19,281,779 |
|
|
|
$12,749,910 |
|
|
$ |
15,843,760 |
|
|
$ |
15,323,284 |
|
|
|
|
|
|
| - aggregate change in actuarial present value of pension benefits |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
| + service cost of pension benefits |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
| + prior service cost of pension benefits |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
| - SCT “Stock Awards” column value |
|
|
7,829,325 |
|
|
|
5,357,573 |
|
|
|
5,895,615 |
|
|
|
5,742,396 |
|
|
|
|
|
|
| - SCT “Option Awards” column value |
|
|
4,725,225 |
|
|
|
4,248,445 |
|
|
|
4,496,806 |
|
|
|
3,904,509 |
|
|
|
|
|
|
+ year-end fair value of equity awards granted in the covered year that were outstanding and unvested as of the covered year-end |
|
|
28,153,093 |
|
|
|
9,783,283 |
|
|
|
24,320,152 |
|
|
|
19,235,117 |
|
|
|
|
|
|
-/+ change in fair value of equity awards granted in prior years that were outstanding and unvested as of the covered year-end |
|
|
4,729,453 |
|
|
|
(20,046,896 |
) |
|
|
17,756,334 |
|
|
|
7,552,919 |
|
|
|
|
|
|
| + vesting date fair value of equity awards granted and vested in the covered year |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
| -/+ change in fair value of equity awards granted in prior years that vested in the covered year |
|
|
(1,227,179 |
) |
|
|
(12,594,107 |
) |
|
|
560,551 |
|
|
|
1,825,968 |
|
|
|
|
|
|
| - fair value as of prior-year end of equity awards granted in prior years that failed to vest in the covered year |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
| + dollar value of dividends/earnings paid prior to the vesting date on equity awards in the covered year |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
| + excess fair value for equity award modifications |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
Compensation Actually Paid to PEO (column (c)) |
|
|
$38,382,596 |
|
|
|
$(19,713,828) |
|
|
$ |
48,088,376 |
|
|
$ |
34,290,383 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Average SCT Total for Non-PEO NEOs (column (d)) |
|
|
|
$6,962,401 |
|
|
|
|
$3,452,393 |
|
|
|
$ |
3,618,848 |
|
|
|
$ |
4,096,941 |
|
|
|
|
|
|
| - aggregate change in actuarial present value of pension benefits |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
| + service cost of pension benefits |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
| + prior service cost of pension benefits |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
| - SCT “Stock Awards” column value |
|
|
|
3,044,738 |
|
|
|
|
1,083,784 |
|
|
|
|
1,074,291 |
|
|
|
|
1,239,836 |
|
|
|
|
|
|
| - SCT “Option Awards” column value |
|
|
|
1,589,850 |
|
|
|
|
877,473 |
|
|
|
|
865,948 |
|
|
|
|
837,232 |
|
|
|
|
|
|
+ year-end fair value of equity awards granted in the covered year that were outstanding and unvested as of the covered year-end |
|
|
|
8,616,321 |
|
|
|
|
2,000,614 |
|
|
|
|
4,500,593 |
|
|
|
|
4,146,248 |
|
|
|
|
|
|
-/+ change in fair value of equity awards granted in prior years that were outstanding and unvested as of the covered year-end |
|
|
|
1,066,986 |
|
|
|
|
(2,812,473 |
) |
|
|
|
2,596,782 |
|
|
|
|
1,556,400 |
|
|
|
|
|
|
| + vesting date fair value of equity awards granted and vested in the covered year |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
| -/+ change in fair value of equity awards granted in prior years that vested in the covered year |
|
|
|
(169,196 |
) |
|
|
|
(1,439,422 |
) |
|
|
|
163,708 |
|
|
|
|
434,160 |
|
|
|
|
|
|
| - fair value as of prior-year end of equity awards granted in prior years that failed to vest in the covered year |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
| + dollar value of dividends/earnings paid prior to the vesting date on equity awards in the covered year |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
| + excess fair value for equity award modifications |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
Average Compensation Actually Paid to Non-PEO NEOs (column (e)) |
|
|
|
$11,841,924 |
|
|
|
|
$(760,145) |
|
|
|
$ |
8,939,692 |
|
|
|
$ |
8,156,681 |
|
3 |
For each year, total shareholder return for the Company and the peer group was calculated in accordance with Item 201(e) and Item 402(v) of Regulation S-K. For purposes of this pay versus performance disclosure, our peer group is the same peer group used for purposes of the performance graph included in the Company’s Annual Reports on Form 10-K for each of the fiscal years ended December 31, 2023, 2022, 2021, and 2020 and consists of the following entities: Akzo Nobel N.V., Axalta Coating Systems Ltd., BASF SE, Genuine Parts Company, H.B. Fuller Company, The Home Depot, Inc., Lowe’s Companies, Inc., Masco Corporation, Newell Brands Inc., PPG Industries, Inc., RPM International Inc., and Stanley Black & Decker, Inc. (for purposes of this section only, the “Peer Group”). |
4 |
Net income is rounded to the nearest hundred thousand. |
5 |
Adjusted EPS is calculated as described in Appendix A. |
|
|
|
|
| Company Selected Measure Name |
Adjusted EPS
|
|
|
|
| Named Executive Officers, Footnote |
1 |
John G. Morikis served as our principal executive officer (“PEO”) for the full year for each of 2023, 2022, 2021, and 2020. Our non-PEO NEOs included: (a) for 2023 and 2022, Allen J. Mistysyn, Heidi G. Petz, Justin T. Binns, and Karl J. Jorgenrud; (b) for 2021, Allen J. Mistysyn, Heidi G. Petz, Mary L. Garceau, Justin T. Binns, and Peter J. Ippolito; and (c) for 2020, Allen J. Mistysyn, Mary L. Garceau, Peter J. Ippolito, and David B. Sewell. |
|
|
|
|
| Peer Group Issuers, Footnote |
3 |
For each year, total shareholder return for the Company and the peer group was calculated in accordance with Item 201(e) and Item 402(v) of Regulation S-K. For purposes of this pay versus performance disclosure, our peer group is the same peer group used for purposes of the performance graph included in the Company’s Annual Reports on Form 10-K for each of the fiscal years ended December 31, 2023, 2022, 2021, and 2020 and consists of the following entities: Akzo Nobel N.V., Axalta Coating Systems Ltd., BASF SE, Genuine Parts Company, H.B. Fuller Company, The Home Depot, Inc., Lowe’s Companies, Inc., Masco Corporation, Newell Brands Inc., PPG Industries, Inc., RPM International Inc., and Stanley Black & Decker, Inc. (for purposes of this section only, the “Peer Group”). |
|
|
|
|
| PEO Total Compensation Amount |
$ 19,281,779
|
$ 12,749,910
|
$ 15,843,760
|
$ 15,323,284
|
| PEO Actually Paid Compensation Amount |
$ 38,382,596
|
(19,713,828)
|
48,088,376
|
34,290,383
|
| Adjustment To PEO Compensation, Footnote |
2 |
For each year, the values included in these columns for the compensation actually paid to our PEO and the average compensation actually paid to our non-PEO NEOs reflect the following adjustments to the values included in columns (b) and (d), respectively: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary Compensation Table (“SCT”) Total for PEO (column (b)) |
|
|
$19,281,779 |
|
|
|
$12,749,910 |
|
|
$ |
15,843,760 |
|
|
$ |
15,323,284 |
|
|
|
|
|
|
| - aggregate change in actuarial present value of pension benefits |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
| + service cost of pension benefits |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
| + prior service cost of pension benefits |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
| - SCT “Stock Awards” column value |
|
|
7,829,325 |
|
|
|
5,357,573 |
|
|
|
5,895,615 |
|
|
|
5,742,396 |
|
|
|
|
|
|
| - SCT “Option Awards” column value |
|
|
4,725,225 |
|
|
|
4,248,445 |
|
|
|
4,496,806 |
|
|
|
3,904,509 |
|
|
|
|
|
|
+ year-end fair value of equity awards granted in the covered year that were outstanding and unvested as of the covered year-end |
|
|
28,153,093 |
|
|
|
9,783,283 |
|
|
|
24,320,152 |
|
|
|
19,235,117 |
|
|
|
|
|
|
-/+ change in fair value of equity awards granted in prior years that were outstanding and unvested as of the covered year-end |
|
|
4,729,453 |
|
|
|
(20,046,896 |
) |
|
|
17,756,334 |
|
|
|
7,552,919 |
|
|
|
|
|
|
| + vesting date fair value of equity awards granted and vested in the covered year |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
| -/+ change in fair value of equity awards granted in prior years that vested in the covered year |
|
|
(1,227,179 |
) |
|
|
(12,594,107 |
) |
|
|
560,551 |
|
|
|
1,825,968 |
|
|
|
|
|
|
| - fair value as of prior-year end of equity awards granted in prior years that failed to vest in the covered year |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
| + dollar value of dividends/earnings paid prior to the vesting date on equity awards in the covered year |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
| + excess fair value for equity award modifications |
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
-0- |
|
|
|
|
|
|
Compensation Actually Paid to PEO (column (c)) |
|
|
$38,382,596 |
|
|
|
$(19,713,828) |
|
|
$ |
48,088,376 |
|
|
$ |
34,290,383 |
|
|
|
|
|
| Non-PEO NEO Average Total Compensation Amount |
$ 6,962,401
|
3,452,393
|
3,618,848
|
4,096,941
|
| Non-PEO NEO Average Compensation Actually Paid Amount |
$ 11,841,924
|
(760,145)
|
8,939,692
|
8,156,681
|
| Adjustment to Non-PEO NEO Compensation Footnote |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Average SCT Total for Non-PEO NEOs (column (d)) |
|
|
|
$6,962,401 |
|
|
|
|
$3,452,393 |
|
|
|
$ |
3,618,848 |
|
|
|
$ |
4,096,941 |
|
|
|
|
|
|
| - aggregate change in actuarial present value of pension benefits |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
| + service cost of pension benefits |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
| + prior service cost of pension benefits |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
| - SCT “Stock Awards” column value |
|
|
|
3,044,738 |
|
|
|
|
1,083,784 |
|
|
|
|
1,074,291 |
|
|
|
|
1,239,836 |
|
|
|
|
|
|
| - SCT “Option Awards” column value |
|
|
|
1,589,850 |
|
|
|
|
877,473 |
|
|
|
|
865,948 |
|
|
|
|
837,232 |
|
|
|
|
|
|
+ year-end fair value of equity awards granted in the covered year that were outstanding and unvested as of the covered year-end |
|
|
|
8,616,321 |
|
|
|
|
2,000,614 |
|
|
|
|
4,500,593 |
|
|
|
|
4,146,248 |
|
|
|
|
|
|
-/+ change in fair value of equity awards granted in prior years that were outstanding and unvested as of the covered year-end |
|
|
|
1,066,986 |
|
|
|
|
(2,812,473 |
) |
|
|
|
2,596,782 |
|
|
|
|
1,556,400 |
|
|
|
|
|
|
| + vesting date fair value of equity awards granted and vested in the covered year |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
| -/+ change in fair value of equity awards granted in prior years that vested in the covered year |
|
|
|
(169,196 |
) |
|
|
|
(1,439,422 |
) |
|
|
|
163,708 |
|
|
|
|
434,160 |
|
|
|
|
|
|
| - fair value as of prior-year end of equity awards granted in prior years that failed to vest in the covered year |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
| + dollar value of dividends/earnings paid prior to the vesting date on equity awards in the covered year |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
| + excess fair value for equity award modifications |
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
-0- |
|
|
|
|
|
|
Average Compensation Actually Paid to Non-PEO NEOs (column (e)) |
|
|
|
$11,841,924 |
|
|
|
|
$(760,145) |
|
|
|
$ |
8,939,692 |
|
|
|
$ |
8,156,681 |
|
|
|
|
|
| Compensation Actually Paid vs. Total Shareholder Return |
Pay Versus Performance Relationship Descriptions The following graphical comparisons describe the relationships between certain figures included in the Pay Versus Performance Table for each of 2023, 2022, 2021, and 2020, including: (a) a comparison between our cumulative total shareholder return and the total shareholder return of the Peer Group; and (b) comparisons between (i) the compensation actually paid to the PEO and the average compensation actually paid to our non-PEO NEOs and (ii) each of the performance measures set forth in columns (f), (h) and (i) of the Pay Versus Performance Table.
|
|
|
|
| Compensation Actually Paid vs. Net Income |
|
|
|
|
| Compensation Actually Paid vs. Company Selected Measure |
|
|
|
|
| Total Shareholder Return Vs Peer Group |
Pay Versus Performance Relationship Descriptions The following graphical comparisons describe the relationships between certain figures included in the Pay Versus Performance Table for each of 2023, 2022, 2021, and 2020, including: (a) a comparison between our cumulative total shareholder return and the total shareholder return of the Peer Group; and (b) comparisons between (i) the compensation actually paid to the PEO and the average compensation actually paid to our non-PEO NEOs and (ii) each of the performance measures set forth in columns (f), (h) and (i) of the Pay Versus Performance Table.
|
|
|
|
| Tabular List, Table |
Tabular List of Financial Performance Measures The following table lists the financial performance measures that we believe represent the most important financial performance measures used to link compensation actually paid to our NEOs for 2023 to Company performance.
|
|
|
|
|
|
|
|
| |
|
|
|
|
|
|
|
| Net Sales |
|
PSG Sales |
|
PCG Sales |
|
|
|
| Adjusted EPS |
|
PSG PBT |
|
PCG PBT |
|
|
|
| Adjusted FCF |
|
PSG RONAE |
|
PCG RONAE |
|
|
|
| Adjusted RONAE |
|
Adjusted EPS |
|
Adjusted EPS |
|
|
|
|
|
Adjusted RONAE |
|
Adjusted RONAE |
|
|
|
|
| Total Shareholder Return Amount |
$ 166.24
|
125.26
|
184.1
|
127.05
|
| Peer Group Total Shareholder Return Amount |
151.33
|
133.55
|
171.96
|
119.46
|
| Net Income (Loss) |
$ 2,388,800,000
|
$ 2,020,100,000
|
$ 1,864,400,000
|
$ 2,030,400,000
|
| Company Selected Measure Amount |
9.57
|
7.92
|
7.32
|
7.36
|
| PEO Name |
John G. Morikis
|
|
|
|
| Morikis [Member] | Measure:: 1 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Net Sales
|
|
|
|
| Morikis [Member] | Measure:: 4 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted EPS
|
|
|
|
| Morikis [Member] | Measure:: 7 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted FCF
|
|
|
|
| Morikis [Member] | Measure:: 10 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted RONAE
|
|
|
|
| Mistysyn [Member] | Measure:: 1 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Net Sales
|
|
|
|
| Mistysyn [Member] | Measure:: 4 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted EPS
|
|
|
|
| Mistysyn [Member] | Measure:: 7 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted FCF
|
|
|
|
| Mistysyn [Member] | Measure:: 10 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted RONAE
|
|
|
|
| Petz [Member] | Measure:: 1 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Net Sales
|
|
|
|
| Petz [Member] | Measure:: 4 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted EPS
|
|
|
|
| Petz [Member] | Measure:: 7 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted FCF
|
|
|
|
| Petz [Member] | Measure:: 10 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted RONAE
|
|
|
|
| Binns [Member] | Measure:: 2 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
PSG Sales
|
|
|
|
| Binns [Member] | Measure:: 4 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted EPS
|
|
|
|
| Binns [Member] | Measure:: 5 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
PSG PBT
|
|
|
|
| Binns [Member] | Measure:: 8 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
PSG RONAE
|
|
|
|
| Binns [Member] | Measure:: 10 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted RONAE
|
|
|
|
| Jorgenrud [Member] | Measure:: 3 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
PCG Sales
|
|
|
|
| Jorgenrud [Member] | Measure:: 4 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted EPS
|
|
|
|
| Jorgenrud [Member] | Measure:: 6 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
PCG PBT
|
|
|
|
| Jorgenrud [Member] | Measure:: 9 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
PCG RONAE
|
|
|
|
| Jorgenrud [Member] | Measure:: 10 |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Name |
Adjusted RONAE
|
|
|
|
| PEO | Aggregate Change In Actuarial Present Value Of Pension Benefits [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
$ 0
|
$ 0
|
$ 0
|
$ 0
|
| PEO | Service Cost Of Pension Benefits [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
0
|
0
|
0
|
0
|
| PEO | Prior Service Cost Of Pension Benefits [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
0
|
0
|
0
|
0
|
| PEO | SCT "Stock Awards" column value [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
7,829,325
|
5,357,573
|
5,895,615
|
5,742,396
|
| PEO | SCT "Option Awards" column value |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
4,725,225
|
4,248,445
|
4,496,806
|
3,904,509
|
| PEO | Year-end fair value of equity awards granted in the covered year that were outstanding and unvested as of the covered year-end [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
28,153,093
|
9,783,283
|
24,320,152
|
19,235,117
|
| PEO | Change in fair value of equity awards granted in prior years that were outstanding and unvested as of the covered year-end [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
4,729,453
|
(20,046,896)
|
17,756,334
|
7,552,919
|
| PEO | Vesting Date Fair Value Of Equity Awards Granted And Vested In The Covered Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
0
|
0
|
0
|
0
|
| PEO | Change In Fair Value Of Equity Awards Granted In Prior Years That Vested In The Covered Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
(1,227,179)
|
(12,594,107)
|
560,551
|
1,825,968
|
| PEO | Fair value as of prior-year end of equity awards granted in prior years that failed to vest in the covered year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
0
|
0
|
0
|
0
|
| PEO | Dollar value of dividends/earnings paid prior to the vesting date on equity awards in the covered year[Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
0
|
0
|
0
|
0
|
| PEO | Excess Fair Value For Equity Award Modifications [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
0
|
0
|
0
|
0
|
| Non-PEO NEO | Aggregate Change In Actuarial Present Value Of Pension Benefits [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
0
|
0
|
0
|
0
|
| Non-PEO NEO | Service Cost Of Pension Benefits [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
0
|
0
|
0
|
0
|
| Non-PEO NEO | Prior Service Cost Of Pension Benefits [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
0
|
0
|
0
|
0
|
| Non-PEO NEO | SCT "Stock Awards" column value [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
3,044,738
|
1,083,784
|
1,074,291
|
1,239,836
|
| Non-PEO NEO | SCT "Option Awards" column value |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
1,589,850
|
877,473
|
865,948
|
837,232
|
| Non-PEO NEO | Year-end fair value of equity awards granted in the covered year that were outstanding and unvested as of the covered year-end [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
8,616,321
|
2,000,614
|
4,500,593
|
4,146,248
|
| Non-PEO NEO | Change in fair value of equity awards granted in prior years that were outstanding and unvested as of the covered year-end [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
1,066,986
|
(2,812,473)
|
2,596,782
|
1,556,400
|
| Non-PEO NEO | Vesting Date Fair Value Of Equity Awards Granted And Vested In The Covered Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
0
|
0
|
0
|
0
|
| Non-PEO NEO | Change In Fair Value Of Equity Awards Granted In Prior Years That Vested In The Covered Year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
(169,196)
|
(1,439,422)
|
163,708
|
434,160
|
| Non-PEO NEO | Fair value as of prior-year end of equity awards granted in prior years that failed to vest in the covered year [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
0
|
0
|
0
|
0
|
| Non-PEO NEO | Dollar value of dividends/earnings paid prior to the vesting date on equity awards in the covered year[Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
0
|
0
|
0
|
0
|
| Non-PEO NEO | Excess Fair Value For Equity Award Modifications [Member] |
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
| Adjustment to Compensation, Amount |
$ 0
|
$ 0
|
$ 0
|
$ 0
|