PROXY SUMMARY
This proxy summary includes key information related to this proxy statement but does not contain all the information you should consider before voting. We strongly encourage you to read the entire proxy statement before voting.
INFORMATION REGARDING ANNUAL MEETING
Distribution of Proxy Materials
We will begin mailing our Notice of Internet Availability of Proxy Materials, which includes instructions on how to access these materials online and vote your shares, on or about March 7, 2025. If you previously elected to receive a paper copy of our proxy materials, on or about the same date, we will mail you our 2024 integrated financial and sustainability report (our “2024 Integrated Report”), which includes a letter to stockholders from our President & Chief Executive Officer (CEO), descriptions of our company, stakeholders, values and strategies, and financial and sustainability highlights; our Annual Report on Form 10-K for the fiscal year ended December 28, 2024 (our “2024 Annual Report”); the notice and proxy statement for our 2025 Annual Meeting of Stockholders (the “Annual Meeting”); and a proxy card.
Time, Date and Format of Annual Meeting
The Annual Meeting will take place at 2:30 p.m. Eastern Time on April 24, 2025. To allow stockholders to attend without the time and expense of doing so in person, the meeting will be held virtually, with attendance via the internet. To attend the virtual Annual Meeting, you will need to log in at www.virtualshareholdermeeting.com/AVY2025 using the 16-digit control number on your Notice of Internet Availability of Proxy Materials, proxy card or voting instruction form.
Online access to the live audio webcast of the Annual Meeting will open at 2:15 p.m. Eastern Time to allow time for you to log in and test your device’s audio system. We encourage you to access the meeting in advance of its start time as we will begin promptly. For additional instructions on how to attend the virtual Annual Meeting, please refer to the Voting and Meeting Q&A section of this proxy statement.
Proposals for Annual Meeting
You are being asked to vote on the proposals shown below. Our Board of Directors (our “Board”) recommends that you vote FOR each of our 9 director nominees in Proposal 1, FOR Proposals 2 and 3, and AGAINST Proposal 4.
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PROPOSAL |
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BOARD RECOMMENDATION |
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| 1 |
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Election of directors |
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FOR each nominee |
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39 |
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| 2 |
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Advisory vote to approve executive compensation |
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FOR |
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49 |
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| 3 |
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Ratification of appointment of PwC as independent registered public accounting firm for FY 2025 |
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FOR |
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90 |
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Vote on stockholder proposal for stockholder approval requirement for excessive golden parachutes, if properly presented during meeting |
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AGAINST |
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97 |
Voting for Annual Meeting
You may vote your shares by submitting a proxy in advance of the Annual Meeting online, by telephone or by mail; only in certain circumstances may you vote during the meeting. If you are a registered stockholder who has not previously voted or wants to change your vote, you may vote during the Annual Meeting. Beneficial holders may only vote during the meeting if they properly request and receive a legal proxy in their name from the broker, bank or other nominee that holds their shares. Shares held through our Employee Savings Plan may not be voted during the meeting. Whether or not you plan to attend the virtual Annual Meeting, we urge you to vote and submit your proxy promptly by following the instructions on your Notice of Internet Availability of Proxy Materials, proxy card or voting instruction form.
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| Avery Dennison Corporation | 2025 Proxy Statement |
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Asking Questions During Annual Meeting
We have designed the virtual Annual Meeting to ensure that you have the same rights and opportunities to participate as you would at an in-person meeting, using an online platform that allows you to attend, vote and ask questions. After we have finished voting upon the proposals and the meeting is adjourned, our Chairman will lead a Q&A session during which we intend to answer all questions submitted timely that are pertinent to our company or the proposals brought before stockholder vote. Answers to questions not addressed during the meeting, if any, will be posted promptly after the meeting on the investors section of our website. For information on how to submit questions during the Annual Meeting, please refer to the Voting and Meeting Q&A section of this proxy statement.
OUR COMPANY
We are a global materials science and digital identification solutions company. We are Making PossibleTM products and solutions that help advance the industries we serve, providing branding and information solutions that optimize labor and supply chain efficiency, reduce waste, advance sustainability, circularity and transparency, and better connect brands and consumers. We design and develop labeling and functional materials, radio-frequency identification (RFID) inlays and tags, software applications that connect the physical and digital, and offerings that enhance branded packaging and carry or display information that improves the customer experience. We serve an array of industries worldwide, including home and personal care, apparel, general retail, e-commerce, logistics, food and grocery, pharmaceuticals and automotive.
Our company is composed of two reportable segments, Materials Group and Solutions Group. Materials Group is a leading global provider to the pressure-sensitive label and graphics industries. Our innovative products include label materials, graphics and reflective materials, and functional bonding materials, like tapes. Our label materials enhance brands’ shelf appeal, inform shoppers, advance circularity, increase transparency, help reduce waste and improve operational supply chain efficiency. Our graphics portfolio offers highly engineered products ranging from vehicle wraps to architectural films. Our tapes portfolio includes bonding and functional materials for applications in various industry sectors such as automotive, building and construction, and electronics. We leverage the group’s materials science capabilities and process engineering expertise to develop and manufacture Intelligent Labels at scale and drive their further adoption through our converter channel access.
Solutions Group is a leading provider of information and branding solutions that cover worldwide marketplace needs ranging from digital identification and data management to branding and embellishment, productivity, pricing and retail media. As a large ultra-high-frequency RFID solutions provider, we empower customers across multiple retail and industry segments, including apparel, logistics, food and grocery and general retail, to connect the physical and digital worlds by enabling a digital identity and life on physical items. Our innovation and data management capabilities, global footprint and market access continuously expand our solutions platform.
BUSINESS FUNDAMENTALS AND STRATEGY OVERVIEW
We are committed to the success of all our stakeholders – our customers, investors, employees and communities – for whom the fundamentals of our business, competitive advantages, financial performance and sustainability progress have delivered strong long-term value. Our vision is to leverage the strengths of our Materials and Solutions businesses to lead at the intersection of the physical and digital, and we are uniquely positioned to help the industries we serve address some of the most complex industry challenges.
We have demonstrated over time and cycles that we can consistently drive strong performance, reflecting our business characteristics described below.
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We are exposed to diverse and growing markets, largely anchored in consumer staples. |
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We are industry leaders in our primary businesses, with significant competitive advantages in scale and innovation. |
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We have a strong foundation in our base businesses, delivering gross domestic product (GDP) growth and strong cash flow. |
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We have catalysts for long-term growth in emerging markets, as well as in high-value categories that are increasingly a larger part of our portfolio, provide competitive differentiation and enable higher margins. |
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We have a strong innovation and productivity culture and an engaged global team that demonstrates agility to adjust our priorities to win in the marketplace. |
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We have a strong balance sheet and disciplined approach to capital allocation that provides investment flexibility to drive further earnings growth. |
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2025 Proxy Statement | Avery Dennison Corporation |
PEOPLE AND CULTURE
Our people-focused pillars include enhancing the experience of our manufacturing employees and making merit and transparency even more foundational to our employee experience. Members of our senior leadership formally sponsor or actively engage in progressing these pillars. We have a global infrastructure and resources in each of our regions to advance our talent priorities and regularly report to, and engage with, our stakeholders so they can assess our progress.
Our employee experience depends on our culture, leadership, technology and work environment. To enhance this experience, we have advanced our employee listening practices and expanded digital access for our manufacturing and remote employees; enabled the continuous growth of our employee resource groups, which are open to all employees; and matured our enterprise leader development programming.
Our 2024 employee engagement survey for the second year leveraged a modernized platform using a significantly expanded set of questions. Included within the respondent group were employees from all recent acquisitions and we maintained our prior-year response rate of 84% despite the significantly larger survey population. Our enterprise engagement score of 85% reflected positive trends across our enterprise and key focus groups. The most notable gains were in areas we had specifically targeted for action, including career advancement opportunity, development opportunity and confidence in business strategy.
Our enterprise competency model launched in 2024 represents our global standard for the leadership skills and behaviors that we develop in our employees so we can achieve our vision. This model establishes clear expectations that align with our values and strategies, and increases fairness, consistency and transparency in how we hire/select, promote, develop and reward talent within and across levels and business units. We continue to embed this standard into our talent processes and practices, including how we assess talent and succession readiness, how we shape development plans, what training we invest in and offer, and what we look for in the talent we hire.
Diversity is one of our values, reflecting our belief that we gain strength and deliver better outcomes from varied ideas. We draw from the largest pool of talent to help find the best people for our company and are committed to only considering legally compliant methods to enhance inclusion. We aim to foster an environment where our employees with various skills, experiences and backgrounds can grow and be increasingly productive and innovative, allowing us to benefit from a highly engaged team and attract and retain top talent for the benefit of our stakeholders. In 2024, among other things, we advanced our people-focused strategic pillars; drove greater accountability and progress through quarterly leadership dashboards and biannual check-ins; and launched our first voluntary self-identification campaign to better understand our global workforce mix. Our 2024 EEO-1 statistics, which reflect information voluntarily disclosed by our U.S. employees, can be found in our ESG Download, which is not incorporated by reference herein.
We annually evaluate pay equity, making merit-based pay adjustments where appropriate. Our teams engage with company leadership on our pay equity/transparency priorities and implement advancements in our process that considers total direct compensation, including base pay, annual incentive compensation and cash/equity-based long-term incentives. In 2024, we expanded our coverage to 90%+ of our global employee population, with substantial expansion in our manufacturing workforce. We also established regionally/locally tailored strategies for advancing pay equity and transparency, including engaging employees in conversations about pay; enhancing trust through enhanced pay program transparency; and ensuring regulatory monitoring readiness and compliance.
STOCKHOLDER ENGAGEMENT
In addition to our ongoing program through which our CEO, CFO, business leaders and Investor Relations team engage with our stockholders throughout the year, we semiannually engage with our largest institutional investors to solicit feedback on our strategies, governance profile, executive compensation and sustainability progress, offering to include directors in scheduled meetings. Our objectives are to maintain regular and thoughtful engagement to directly obtain feedback; continue to strengthen our relationships with investors; and gather perspectives to identify potential improvement opportunities. Our Board and management believe that ongoing stockholder engagement fosters a deeper understanding of evolving investor expectations and helps ensure we continue to reflect best practices.
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2025 Proxy Statement | Avery Dennison Corporation |
GOVERNANCE
The key features of our governance program are shown in the Governance Highlights section of the proxy summary. We encourage you to visit the investors section of our website under Governance Documents, where you can view and download current versions of the documents shown below. Information on our website is not and should not be considered part of, nor is it incorporated by reference into, this proxy statement.
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Amended and Restated Certificate of Incorporation, as amended |
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Amended and Restated Bylaws (our “Bylaws”) |
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Corporate Governance Guidelines (our “Governance Guidelines”) |
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Charters for our Board’s Audit Committee, Compensation Committee, Governance Committee and Finance Committee |
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Code of Ethics for the CEO and Senior Financial Officers |
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Audit Committee Complaint Procedures for Accounting and Auditing Matters |
You can request copies of these documents, without charge, by writing to our Corporate Secretary at 8080 Norton Parkway, Mentor, Ohio 44060.
VALUES AND ETHICS (V&E)
Code of Conduct, Talkabout Toolkits and Supplier Standards
Our Code of Conduct applies to all of our directors, officers and employees and reflects our values of integrity, courage, external focus, diversity, sustainability, innovation, teamwork and excellence. In 2024, we launched a refreshed Code of Conduct that evidences our ongoing commitment to maintaining a values-based culture while adapting to the changing world around us. We improved clarity and readability, with refreshed branding, expanded content on key topics such as cybersecurity, data privacy and third-party risk management, and added topics; we also provided additional real-world guidance using updated scenarios and Q&A to better connect the Code to our team members’ work and decision-making.
The Code is available in 30+ languages in downloadable and printable forms, as well as through a public interactive microsite that provides transparency of our adherence to ethical conduct to our external stakeholders. Our leaders affirm their commitment to complying with it when they first join our company and regularly thereafter as part of the compliance certification process described in the Related Person Transactions section of this proxy statement. We perform in-person compliance check-ins at select global sites to measure the effectiveness of our V&E program using surveys to measure awareness, conducting interviews with leadership and manufacturing employees, and implementing any needed actions to enhance awareness.
We regularly train employees on Code of Conduct topics in instructor-led sessions held in person or virtually; in 2024, we held more than 250 of these sessions globally. We also deploy mandatory online training for our computer-based employees. In 2024, we launched one enterprise-wide and five regional courses using a targeted risk-based approach, with an average completion rate for the approximately 62,000 courses of ~97%. The two “Talkabout” Toolkits (also available in 30+ languages) that we developed during the year empowered managers to lead discussions with their teams regarding topics from the Code of Conduct using presentation slides, which were supplemented by internal social media campaigns for our employees to engage with their colleagues across the globe.
Our global supplier standards extend our V&E commitment to our third-party service providers, establishing our expectation that they do business in an ethical manner.
Business Conduct GuideLine
Our Business Conduct GuideLine (the “GuideLine”) is a whistleblower hotline available at all hours for employees or third parties to report potential violations of our Code of Conduct or applicable laws, anonymously if they so choose.
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2025 Proxy Statement | Avery Dennison Corporation |
The GuideLine may be reached by visiting www.averydennison.com/guidelinereport. The GuideLine is operated by an independent third party and accepts reports in any language to accommodate the needs of our global workforce and customer/supplier base. Reports are investigated under the direction of our Chief Compliance Officer, in consultation with our law department and senior management and with Board oversight primarily by the Governance Committee and, for certain accounting- and financial-related matters, also by the Audit Committee. We prohibit retaliation for good-faith reporting.
Code of Ethics
Our Code of Ethics requires that our CEO, CFO and Controller act professionally and ethically in fulfilling their responsibilities. Only the Audit Committee or the Governance Committee can amend or waive the provisions of our Code of Ethics, and any amendments or waivers must be posted promptly on our website or timely filed with the SEC on a Current Report on Form 8-K. To date, we have made no exemptions or granted any waivers to our Code of Ethics.
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| CODE OF ETHICS RESPONSIBILITIES |
| • Avoid actual or apparent conflicts of interest • Ensure complete and accurate SEC filings • Respect confidentiality of financial and other information • Employ corporate assets responsibly • Report Code of Ethics violations to Chair of Audit or Governance Committees |
Supporting fulfillment of these responsibilities, our controllership and internal audit functions ensure that we maintain a robust internal control environment, with the leaders of these functions regularly reporting to and meeting in executive session with the Audit Committee.
COMPLAINT PROCEDURES FOR ACCOUNTING AND AUDITING MATTERS
The Audit Committee has adopted procedures for the confidential, anonymous submission of complaints related to accounting, accounting standards, internal accounting controls and audit practices.
These procedures relate to reports of (i) fraud or deliberate error in the preparation, evaluation, review or audit of our financial statements or other financial reports; (ii) fraud or deliberate error in the recording or maintenance of our financial records; (iii) deficiencies in, or noncompliance with, our internal accounting controls; (iv) misrepresentation or false statement regarding any matter contained in our financial records, statements or other reports; or (v) deviation from full and fair reporting of our financial condition. Any person, including third parties, may submit a good-faith complaint regarding accounting and auditing matters and employees may do so without fear of retaliation. The Audit Committee oversees these procedures, with investigations conducted under the direction of our internal audit department in consultation with our Corporate Secretary, Chief Legal Officer (CLO) and other members of senior management to the extent appropriate under the circumstances.
Stockholders and other interested parties interested in communicating regarding these matters may make a confidential, anonymous report by contacting the GuideLine or writing to the Audit Committee Chair, c/o Corporate Secretary, 8080 Norton Parkway, Mentor, Ohio 44060.
STOCK OWNERSHIP POLICY
Our stock ownership policy requires that our (i) non-employee directors acquire and maintain minimum ownership in our company of $500,000, (ii) CEO and Executive Chairman acquire and maintain minimum ownership of 6x their base salary and (iii) Level 2 and Level 3 executives acquire and maintain minimum ownership of 3x and 2x their base salary, respectively. At least 50% of the applicable requirement must be held in vested shares.
The values of the following shares/units are considered in measuring compliance with our stock ownership policy: (i) shares beneficially owned or deemed to be beneficially owned, directly or indirectly, under U.S. securities laws; (ii) for officers, shares or units held in qualified and non-qualified employee benefit plans and 50% of the value of unvested MSUs at the target payout level; (iii) for non-employee directors, deferred stock units (DSUs); and (iv) for officers and non-employee directors, unvested RSUs subject to time-based vesting. Unvested stock options and PUs are not considered in measuring compliance. DSUs, which represent annual cash retainers deferred at a director’s election, are considered owned because they are earned upon receipt and would be paid out to a participating director upon his or her separation from our Board.
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| Avery Dennison Corporation | 2025 Proxy Statement |
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council, which is composed of a cross-divisional and cross-functional group of company and business leaders, met regularly during 2024 to ensure we largely deliver our 2025 sustainability goals, make progress toward achieving our 2030 sustainability goals and targets, and accurately report to our stakeholders. Our enterprise sustainability leader participated in all of our 2024 off-season stockholder engagements to report on our sustainability advancements and answer questions from investors.
PROGRESS TOWARD ACHIEVING OUR 2025 AND 2030 GOALS
We believe that our sustainability priorities reflect the expectations of our stakeholders. We regularly report our sustainability progress and interview members of management responsible for key sustainability initiatives, as well as third parties such as sell-side analysts and members of sustainability organizations, during our biannual materiality assessments. The feedback we received engaging with investors related to environmental and social sustainability matters in 2024 can be found in the proxy summary.
We present scorecards showing progress against our 2025 and 2030 sustainability goals through 2024 in the proxy summary. You can find additional information in our 2024 Integrated Report being furnished to the SEC prior to the distribution of our proxy materials and our ESG Download being made available on our website at esg.averydennison.com on or before the filing of this proxy statement. Information on our website is not and should not be considered part of, nor is it incorporated by reference into, this proxy statement.
We disclose our sustainability metrics in accordance with the SASB framework, noting where those disclosures align with the GRI framework, and annually respond to CDP Climate, Water Security and Forests. We are a member of the United Nations Global Compact and have made commitments to the United Nations Sustainable Development Goals and the Science Based Targets initiative (SBTi). Our Scope 1, 2 and 3 GHG emissions reduction targets have been approved by SBTi as consistent with reductions required to keep global warming to no more than 1.5°C. We are in the process of aligning our sustainability reporting with TCFD requirements.
TALENT MANAGEMENT
Succession Planning
Recognizing that we have had several leadership changes in recent years, including the appointments of our CEO and Solutions President in 2023 and our Interim CFO and Materials President in 2024, our Board has further prioritized its focus on leadership succession planning. In April 2024, reflecting its practice of conducting CEO succession planning at least annually, our Board discussed the progress of potential internal CEO successors, utilizing a scorecard of desired attributes and outcomes and required and preferred experiences aligned upon with a third-party leadership advisory firm. At that time, the Compensation Committee also reviewed leadership changes and discussed potential successors to the members of our Company Leadership Team, which includes the leaders of our businesses and corporate functions, with reference to their performance scorecards, our enterprise leadership competency model, and profiles detailing the skills and experiences required of these roles.
In October 2024, the Compensation Committee reviewed leadership changes and the key areas of focus in our Materials and Solutions businesses, as well as enterprise-wide, with a view to ensuring that identified potential successors are meaningfully progressing with their development plans. In addition, during the year, the Compensation Committee focused more deeply on key areas of succession priority, such as the roles of CFO, Chief Strategy and Corporate Development Officer (CSDO) and Chief Information Officer, and its Chair reported on these succession planning reviews to our Board.
The Compensation Committee regularly receives reports on executive new hires, promotions and role changes, departures and open positions to assist with succession planning.
Leadership Development
The Compensation Committee oversees our talent management efforts to identify and develop our future leaders. We maintain a robust performance review process and establish leadership development plans for our top talent, while also providing career advancement opportunities to our employees more broadly. Senior management reports to the Compensation Committee on our leadership by identifying high-potential talent, helping these individuals advance
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| Avery Dennison Corporation | 2025 Proxy Statement |
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the skills and capabilities to become our future leaders, and ensuring that they are executing development plans to progress them toward identified roles with greater responsibility. As part of its regular meeting process, our Board has the opportunity to engage with our business and functional leaders in and outside the boardroom. In addition, Board members periodically visit our facilities to meet with local management and have the freedom to engage directly with any of our employees.
COMMUNITY INVESTMENT
With Board oversight by the Governance Committee, our community investment efforts help strengthen the communities around the world in which we operate. We make most of these investments through ADF, which annually distributes at least 5% of its assets from the prior year. ADF’s grantmaking is aided by our employees worldwide who identify nonprofit organizations serving their local communities in need of financial support to advance their mission and impact, make monetary contributions and volunteer their time.
ADF’s grantmaking strategy focuses on providing funding to charitable organizations working to increase education access, advance environmental sustainability and support secure livelihoods. In addition to these grantmaking focus areas, among other things, ADF supports employees in times of crisis and nonprofit organizations aiding in disaster relief.
ADF and our company collectively made $4.9 million in grants and other charitable contributions during 2024.
Advancing Strategic Pillars
In support of its vision and mission, ADF prioritizes grants to communities and geographies facing the greatest need. The aggregate amount of grants made in 2024 in each of ADF’s strategic pillars, as well as select grant recipients, are shown below; the remainder of ADF’s contributions were primarily made in the other areas described in this section. Over 90% of ADF grants incorporated employee volunteerism.
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| HIGHLIGHTS OF 2024 ADF STRATEGIC PILLAR CONTRIBUTIONS |
| ~$700K TO INCREASE EDUCATION ACCESS |
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~$500K TO ADVANCE ENVIRONMENTAL SUSTAINABILITY |
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~$350K TO SUPPORT SECURE LIVELIHOODS |
| • Associação Beneficente ABID to enhance educational foster care services in Brazil • Minds Matter Cleveland to support college readiness and access for students in Ohio • The Womanity Foundation to advance girls’ education in Afghanistan |
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• Beijing Roots & Shoots to support youth conservation programs in China • Global Forest Generation to scale forest ecosystems in South America • Quang Binh Community Development to reduce plastic waste in Vietnam |
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• Building Markets to improve market access for small businesses in Colombia • Defence for Children International to support migrant/refugee women and children in Greece • The Hunar Foundation to provide vocational training in Pakistan |
Supporting Employees in Times of Crisis
ADF’s Employee Crisis Fund offers financial assistance to our employees impacted by natural disasters and other humanitarian crises, providing support of $650,000 to more than 1,500 company employees in Bangladesh, Brazil and the U.S. in 2024.
Supporting Disaster Relief Efforts
ADF partners with an independent nonprofit organization, GlobalGiving, to directly support and match employee giving to disaster relief efforts around the globe. During 2024, ADF and our employees made donations to organizations responding to events in Brazil, Japan, Spain and the U.S., as well as providing emergency and long-term support to people in need in the Middle East.
Engaging Employees
Through ADF’s signature Granting Wishes program, employees organize volunteer events and nominate local NGOs to receive grants. In 2024, ADF made $1.1 million of grants in 34 countries through this program.
Providing College Scholarships
ADF provided college scholarships to selected children of company employees in 2024, furthering its goal of increasing educational access. The program administered by Scholarship America annually awards scholarships in the U.S. and Canada. In 2024, ADF engaged the Institute of International Education to administer a similar program in Bangladesh, Brazil, Honduras, India, Malaysia, Mexico, South Africa, Sri Lanka, Turkey and Vietnam, with plans to further expand to other countries in which we have a significant employee presence.
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DIRECTOR COMPENSATION
In recommending non-employee director compensation to our Board, the Compensation Committee seeks to target compensation around the median of similar-size companies with which we compete for director talent. The majority of compensation is delivered in equity to align director interests with those of our stockholders.
Annual Compensation
The components of our 2024 non-employee director compensation program are shown in the charts below.
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| NON-EMPLOYEE DIRECTOR COMPENSATION |
| Target Grant Date Fair Value of RSUs |
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185K |
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| Board Retainer |
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115K |
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| Match of Charitable/Educational Contributions |
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10K |
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| Additional Retainers* |
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| Lead Independent Director |
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$ |
45K |
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| Audit Committee Chair |
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$ |
35K |
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| Compensation Committee Chair |
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25K |
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| Governance Committee Chair |
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25K |
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| * There is no additional Finance Committee Chair retainer at this time because our Executive Chairman currently serves in that capacity. |
Our 2017 Incentive Award Plan limits the sum of the grant date fair value of equity awards and cash compensation provided to non-employee directors during any calendar year to $600,000.
Compensation Setting
Non-employee director compensation is generally reviewed by the Compensation Committee every three years. In February 2024, the Compensation Committee’s independent compensation consultant, WTW, analyzed trends in non-employee director compensation and assessed our program’s market competitiveness.
Using benchmark data from public filings of companies in the Fortune 350-500, WTW recommended the following increases to non-employee director compensation: the target grant date fair value of the annual RSU award by $15,000; the Board retainer by $15,000; the additional retainer for our Lead Independent Director by $15,000; and the additional retainers for our Audit, Compensation and Governance Committee Chairs by $10,000, $5,000 and $5,000, respectively. These modest increases would bring total direct compensation for regular Board service to $300,000 (or $310,000 with the charitable match), the projected median of Fortune 350-500 companies in 2027, the next time the Compensation Committee planned to review the program. Giving consideration to the advice of WTW, the Compensation Committee recommended to our Board that the target grant date fair value of the annual award of RSUs be $185,000; the Board retainer be $115,000; the additional retainer of our Lead Independent Director be $45,000; and the additional retainers for our Audit, Compensation and Governance Committee Chairs be $35,000, $25,000 and $25,000, respectively.
Upon the recommendation of the Compensation Committee, our Board approved the revised non-employee director compensation program reflected in the charts above, effective as of the date of the 2024 Annual Meeting.
Stock Ownership Policy
Our stock ownership policy requires non-employee directors to own at least $500,000 of our company stock, 50% of which must be held in vested shares. Only shares owned directly or in a trust, DSUs and unvested RSUs subject to time-based vesting are measured in determining policy compliance.
Our non-employee directors have achieved the minimum ownership required by our stock ownership policy other than Messrs. Dickson and Wagner and Mses. Reverberi and Mejia who have five years from the date of their respective Board appointment to achieve that level.
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Equity Compensation
The annual equity award to non-employee directors consists of RSUs that vest on the one-year anniversary of the grant date, consistent with the one-year term to which directors are elected. Unvested RSUs (i) fully vest upon a director’s death, disability, retirement from our Board after reaching age 72 or termination of service within 24 months after a change of control and (ii) are cancelled in the event a director is not reelected by stockholders or leaves our Board before vesting, unless otherwise determined by the Compensation Committee. On May 1, 2024, each of our then-serving non-employee directors was awarded 844 RSUs with a grant date fair value of $182,043.
In connection with their appointments to our Board, (i) on February 22, 2024, Ms. Mejia received an award of 132 RSUs with a grant date fair value of $27,816, reflecting the 2023 director equity award of $170,000 prorated for the remaining two months of the term ending at the 2024 Annual Meeting, and (ii) on June 1, 2024, Mr. Dickson received an award of 753 RSUs with a grant date fair value of $167,030, reflecting the 2024 director equity award of $185,000 prorated for the remaining 11 months of the term ending at the Annual Meeting.
As of their respective departure dates from our Board in April, November and December 2024 and as permitted by our 2017 Incentive Award Plan, the Compensation Committee accelerated the vesting of the RSUs granted on May 1, 2024 to Ms. Stewart, Mr. Hicks and Ms. Sullivan in recognition of their decade-plus service on our Board.
Deferrable Cash Compensation
Annual retainers are paid semiannually and prorated for any director’s partial service during the year. Our non-employee directors may elect to receive this compensation in (i) cash, either paid directly or deferred into an account under our Directors Variable Deferred Compensation Program (DVDCP), which accrues earnings at the rate of return of certain bond and equity investment funds managed by a third party; (ii) DSUs credited to an individual account pursuant to our Directors Deferred Equity Compensation Program (DDECP); or (iii) a combination of cash and DSUs. For directors with a DDECP account balance, dividend equivalents, representing the value of dividends paid on shares of our common stock calculated based on the number of DSUs held as of a dividend record date, are reinvested on the applicable payable date in the form of additional DSUs. In 2024, none of our non-employee directors participated in the DVDCP and four of them participated in the DDECP.
When a participant in the DDECP ceases serving as a director, the dollar value of the DSUs in his or her account is divided by the closing price of our common stock on the date of the director’s separation, with the resulting number of shares of our common stock, less fractional shares, issued to the director. In connection with their departures from our Board in April, November and December 2024, Ms. Stewart, Mr. Hicks and Ms. Sullivan were issued 43,365, 15,512 and 14,470 shares of our common stock, respectively, based on their separation date DDECP account balance.
Charitable Match
We match up to $10,000 per year of each non-employee director’s documented contributions to charitable organizations or educational institutions.
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| Avery Dennison Corporation | 2025 Proxy Statement |
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Pension/Retirement Benefits
Subject to the same terms and conditions as our other eligible U.S. employees, Messrs. Butier and Lovins are our only NEOs eligible for pension benefits under our benefit restoration plan, a nonqualified excess benefit plan. Because the accrual of benefits under the benefit restoration plan was frozen as of year-end 2010, neither of our eligible NEOs accrued additional pension benefits during 2024. For additional information regarding the benefit restoration plan and accrued NEO benefits thereunder, see 2024 Pension Benefits in Executive Compensation Tables.
Mr. Allouche has non-pension retirement benefits under certain funds required by Israeli law. Company contributions to these funds are disclosed in the All Other Compensation column of the 2024 Summary Compensation Table.
Defined Contribution Benefits
Our U.S. NEOs are eligible to participate in our employee savings plan, a qualified 401(k) plan that allows U.S. employees to defer up to 100% of their eligible earnings less payroll deductions on a pre-tax basis and 25% of their eligible earnings on an after-tax basis, subject to the annual limit prescribed by the Internal Revenue Service for the aggregate of company contributions and employee pre- and post-tax contributions. Employee contributions are immediately vested. In 2024, we contributed up to 6.5% of an employee’s eligible compensation, 3% of which was an automatic contribution and up to 3.5% of which was a matching contribution of 50% of the employee’s contributions up to 7% of pay, subject to the Code compensation limit. Participants vest in our company contributions after two years of service.
All U.S. NEOs participated in the savings plan in 2024, subject to the terms and conditions as our other U.S. employees, and are fully vested.
Executive Life Insurance Benefits
In addition to the $50,000 in life insurance benefits we provide to all U.S. employees, our U.S. executives are provided with supplemental life insurance benefits equal to three times their base salary less $50,000, up to a maximum coverage amount of $1 million.
Executive Long-Term Disability Insurance Benefits
If they elect to enroll in executive long-term disability coverage, our U.S. executives have long-term disability benefits equal to 65% of their eligible pre-disability monthly earnings up to a maximum of $25,000 per month. Coverage is available only for the individual; dependents are not covered.
Executive Excess Liability Insurance Benefits
We provide $3 million of personal excess liability insurance coverage to our U.S. executives. Personal excess liability coverage supplements the individual’s personal liability insurance provided that they maintain certain minimum coverage requirements.
Charitable Match Benefits
We match up to $10,000 of our CEO’s and our Executive Chairman’s and $5,000 of our other NEOs’ annual documented contributions to charitable organizations or educational institutions.
Termination Benefits
Consistent with market practices, the Committee believes that providing our executives with termination benefits helps ensure that they act in the best interests of our company and stockholders, even if doing so may be contrary to their personal interests, such as where it could lead to a change of control of our company.
The compensation of our participating NEOs in the event of termination not for cause is governed by our Amended and Restated Executive Severance Plan (the “Severance Plan”) and, as applicable, our Amended and Restated Key Employee Change of Control Severance Plan (the “COC Severance Plan”). We use these plans rather than individually negotiated agreements to allow us to change the termination benefits for which applicable NEOs are eligible to reflect market practices without the need to obtain their individual consent. In addition, this plan-based approach eliminates the need to individually negotiate arrangements and ensures that eligible NEOs receive severance and other benefits on the same terms and conditions as employees with similar levels of responsibility. Receipt of benefits under these plans is conditioned on the executive signing a waiver and general release of claims against our company, as well as agreeing to certain restrictive covenants in favor of our company. Any violation of these covenants could result in our company
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seeking to recover some or all severance benefits previously paid or pursuing any other claims that may be appropriate under the circumstances. Mr. Butier ceased being a participant in the Severance Plan or the COC Severance Plan in September 2023.
Unvested equity awards outstanding on the date of termination are generally cancelled, except for employees who qualify as retirement eligible under the terms of our equity incentive plan, whose awards are accelerated upon termination of service. Mr. Stander was the only NEO who qualified as retirement eligible at year-end 2024.
For additional information regarding potential NEO benefits under these plans, including the treatment of equity awards under various termination scenarios, see Payments Upon Termination as of December 28, 2024 in Executive Compensation Tables.
Benefits Following Involuntary Termination Not for Cause
Our participating NEOs are eligible to receive severance and other benefits upon involuntary termination not for “cause,” in accordance with the terms and conditions of the Severance Plan. In the event of a qualifying termination, our CEO would receive severance of two times the sum of his annual salary and target AIP award; our other eligible NEOs would receive severance of one time their respective sum of these amounts. In addition, they would receive non-severance benefits of (i) two times and one time, respectively, of the cash value of 12 months of their qualified medical and dental insurance premiums and (ii) up to $25,000 in outplacement services for one year following termination of employment. Any payments made under the Severance Plan would be offset by any payments received by the NEO under any statutory, legislative and regulatory requirement or, if applicable, the COC Severance Plan.
Benefits Following Change of Control
Only our CEO and Level 2 NEOs are eligible to receive enhanced severance and other benefits upon termination not for cause or by the executive for good reason within 24 months of a change of control of our company, in accordance with the terms and conditions of the COC Severance Plan. In the event of a qualifying termination following a change of control, our CEO would receive severance of 2.99 times (reduced from 3.00 times effective January 31, 2025) the sum of his annual salary and target AIP award; our Level 2 NEOs would receive severance of two times their respective sum of these amounts. In addition, they would receive non-severance benefits of (i) a prorated target AIP award for the year of termination, (ii) 2.99 (reduced from 3.00 times effective January 31, 2025) and two times, respectively, of the cash value of 12 months of their qualified medical and dental insurance premiums and (iii) up to $25,000 in outplacement services for one year following termination of employment. Any payments under the COC Severance Plan would be offset by any payments received by the NEO under the Severance Plan and any other statutory, legislative and regulatory requirement. In the event of termination following a change of control, our Level 3 NEO would be entitled to receive benefits under the Severance Plan described above.
Participating NEOs are not eligible to receive any excise tax gross-up on amounts payable under the COC Severance Plan. If the NEO would otherwise incur excise taxes under Section 4999 of the Code, payments under the COC Severance Plan would be reduced so that no excise taxes would be due if the reduction results in a greater after-tax benefit to the NEO.
Under our equity incentive plan, unvested awards would generally vest if our NEOs are terminated without cause or resign for good reason within 24 months after the change of control. Outstanding PUs and MSUs vest based on actual performance, if determinable, and otherwise based on target performance.
COMPENSATION-SETTING TOOLS
Market Data
The Committee annually considers market survey data of base salary, incentive compensation and target TDC, considering companies of similar size based on annual revenues across all industries to reflect the broad talent market across which we seek our executives. The Committee reviews results from a third-party survey to understand market compensation practices and assess our competitiveness, narrowing the scope of the results to account for variations caused by company size. The Committee reviews the data on an aggregated basis, with no consideration of the survey’s component companies, which are not determined or known by the Committee.
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Advisor Independence
WTW and the Committee have established the following protocols to ensure the firm’s independence from management: the Committee has the sole authority to select, retain and terminate WTW and, acting through its Chair, authorize the firm’s fees, determine the terms and conditions that govern the engagement and direct WTW on the delivery and communication of its work product; in the performance and evaluation of its duties, WTW is accountable, and reports directly, to the Committee; and members of the Committee may consult with WTW at any time, with or without members of management present, in their sole discretion.
The Committee considered the independence of its advisors in November 2024, noting the below factors regarding WTW’s independence.
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WTW performed minimal other services for our company in 2024 outside of the executive compensation services it performed for or at the request of the Committee |
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Fees from our company reflected less than 0.002% of WTW’s revenue for its 2024 fiscal year |
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WTW has policies and procedures to ensure its advice is objective and independent, including a comprehensive code of conduct, ethics and quality policies that mandate rigorous work reviews and periodic compliance reviews, and consulting protocols to ensure the objectivity of its compensation consulting work |
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Based on disclosures from WTW and members of the Committee, there are no business or personal relationships between them |
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No members of the WTW team serving the Committee own stock in our company, other than potentially through investments in mutual or other funds managed without the member’s input |
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Based on disclosures from the firm and our officers, there are no business or personal relationships between WTW or the members of the engagement team advising the Committee with any executive officer of our company |
COMPENSATION CLAWBACK POLICIES
Our Policy for Recovery of Erroneously Awarded Compensation (“Section 16 Clawback”) applies to our current and former executive officers, including all NEOs, and subjects their incentive-based compensation received on or after October 2, 2023 to clawback in the event our company is required to prepare an accounting restatement to correct material noncompliance with any financial reporting requirement under U.S. securities laws, including restatements that correct an error in previously issued financial statements that (i) is material to the previously issued financial statements or (ii) would result in a material misstatement if the error were corrected or left uncorrected in the current period. In these circumstances, the Section 16 Clawback requires our company to recover, reasonably promptly, the portion of incentive-based compensation that is deemed to have been erroneously awarded, unless the Committee (which administers the
policy) determines that recovery would be impracticable and that one or more of the allowable impracticability conditions under SEC rules has been met. Recovery is required whether or not the applicable officer engaged in misconduct or otherwise caused or contributed to the requirement for the restatement. Each of our executive officers, including all NEOs, has agreed to the terms of the Section 16 Clawback and acknowledged that their compensation may be subject to reduction, cancellation, forfeiture and/or recoupment.
At the time it recommended to our Board the adoption of the Section 16 Clawback, the Committee recommended that our existing clawback policy remain in effect. This clawback policy applicable to all AIP and LTI recipients requires that, in the event of fraud or other intentional misconduct on the part of an awardee that necessitates a restatement of our financial results (including, without limitation, any accounting restatement due to material noncompliance with any financial reporting requirement), the Committee may require that the awardee reimburse our company for any AIP or LTI awards, including time-vesting LTI awards, paid or issued in excess of the amount that would have been paid or issued based on the restated financial results. This more widely applicable clawback policy has been expressly incorporated into our AIP and LTI plans and is contractually agreed to by LTI recipients, including all NEOs, in their annual award agreements.
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In the event of termination, our NEOs would be entitled to receive any accrued balance under the EVDRP, subject to Section 409A of the Code. These amounts would be distributed in accordance with the participant’s distribution election and the terms and conditions of the plan, and are not included in the table. See 2024 Nonqualified Deferred Compensation for more information.
The other potential payments upon termination are described below.
Executive Officer Cash Severance Policy
The Compensation Committee adopted an Executive Officer Cash Severance Policy effective January 31, 2025 providing that we will not enter into any new employment agreement or severance arrangement after the policy’s effective date with an executive officer (as defined under the Exchange Act) of our company or establish any new severance agreement, plan, arrangement or policy covering any such officer after such date, in each case that provides for a cash severance payment in connection with any termination of his or her employment exceeding 2.99 times the sum of such officer’s base salary plus target AIP award without seeking stockholder ratification of such agreement, plan, arrangement or policy.
Executive Severance Plan
All NEOs other than Mr. Butier are eligible participants under the Severance Plan. Upon involuntary termination not for cause, they would be eligible for the severance and other benefits shown below.
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for year of termination Non-severance benefit of cash value
of 12 months of medical and dental
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Outplacement services of up to $25,000 for up to one year |
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Benefits Not Subject to Gross-up. Benefits are subject to withholding for all applicable taxes and not grossed-up for taxes.
Trigger for Benefits. Involuntary termination, which excludes termination for cause or due to disability, death, voluntary resignation, or an executive declining simultaneous or continuing employment in a comparable position.
Definition of Cause. Cause is defined as (i) commission of a crime or other act that could materially damage the reputation of our company or its subsidiaries; (ii) theft, misappropriation or embezzlement of company or subsidiary property; (iii) falsification of company or subsidiary records; (iv) substantial failure to comply with written policies and procedures; (v) misconduct; or (vi) substantial failure to perform material job duties not cured within 30 days after written notice.
Key Executive Change of Control Severance Plan
The COC Severance Plan provides enhanced termination benefits for key executives to incent their retention during a period in which a change of control transaction is being negotiated or a hostile takeover is being attempted. In 2024, Messrs. Stander, Lovins, Melo and Yost were the only eligible participants in the COC Severance Plan, which entitles them to benefits only if they are terminated not for “cause” or terminate employment for “good reason” within 24 months of the change of control (a “double-trigger”). In these circumstances, these NEOs would be eligible for the severance and other benefits shown below. In the event of termination following a change of control, our Level 3 NEO would be eligible for termination benefits under the Severance Plan described above.
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for year of termination Non-severance benefit of cash value
of 12 months of medical and dental
insurance premiums |
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2.99 For CEO (reduced from 3.00 eff. January 31, 2025) |
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CEO PAY RATIO
With 70% of our 2024 revenues originating outside the U.S. and 40% of our revenues originating in emerging markets (Latin America, Eastern Europe, Middle East/Northern Africa and most countries in Asia Pacific), our employees are located in more than 50 countries to best serve our customers. At year-end 2024, 83% of our employees were located outside the U.S. and 66% were located in emerging markets, where median compensation is substantially lower than it is in the U.S.
The charts below show the demographics of our global workforce by region and function. At year-end 2024, more than 19,000 of our approximately 35,000 employees were in Asia Pacific, serving our customers in the region. In addition, more than 22,000 employees at that time worked in the operations of our manufacturing facilities or in positions directly supporting them from other locations.
We offer market-based, competitive wages and benefits in the markets where we compete for talent. All of our employees were paid at least the applicable legal minimum wage, and 99% of our employees were paid above the applicable legal minimum wage at year-end 2024.
2024 PAY RATIO
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The 2024 total compensation of our median employee (among all employees except our CEO) was $17,126. |
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The 2024 total compensation of our CEO, as reported in the Total column of the 2024 Summary Compensation Table, was $9,853,372. |
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Based on this information, a reasonable estimate of the 2024 ratio of the annual total compensation of our CEO to the annual total compensation of our median employee was approximately 575 to 1. |
We calculated this ratio based on SEC rules and guidance, which allow for companies to use varying methodologies to identify their median employee. Other companies may have different workforce demographics and employment and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions. As a result, their CEO pay ratios may not meaningfully compare to ours.
IDENTIFICATION OF MEDIAN EMPLOYEE
Because there were no significant changes to our employee population or compensation arrangements in 2024 that would impact our CEO pay ratio disclosure, we used the same median employee as in prior year. To identify this employee in 2023, we considered annual base compensation, which is the principal compensation element for the vast majority of our employees globally. We measured compensation for purposes of determining the median employee using the 12-month period ended December 31, 2023, making no cost-of-living adjustments.
We selected December 19, 2023 as the date on which to determine our median employee. As of that date, we had 34,472 employees, 28,743 of which were located outside the U.S. and 22,751 of which were located in emerging markets. We utilized the de minimis exemption to exclude the following countries representing no more than 5% of our global population in the aggregate: Kenya (15 employees), Mauritius (18 employees), Pakistan (345 employees), Indonesia (473 employees) and Sri Lanka (523 employees), representing approximately 0.04%, 0.05%, 1.0%, 1.37% and 1.52%, respectively, of our global workforce at that time.
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OVERSIGHT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Committee is responsible for appointing the independent registered public accounting firm and monitoring and overseeing its qualifications, compensation, performance and independence. In this capacity, the Committee reviewed with PwC the overall scope of services and fees for its audit and monitored the progress of the audit in assessing our compliance with Section 404 of the Sarbanes-Oxley Act of 2002, including the firm’s findings and required resources.
PwC provided to the Committee the written disclosures and independence letters required by the PCAOB regarding communications concerning independence – including Rule 3524, Audit Committee Pre-approval of Certain Tax Services, and Rule 3526, Communication with Audit Committees Concerning Independence. The Committee has a policy requiring pre-approval of fees for audit, audit-related, tax compliance and tax planning services and has concluded that PwC’s provision of limited non-audit services to our company in 2024 did not impair its independence. The Committee discussed with PwC its independence from our company, Board and management and concluded that PwC was independent during fiscal year 2024.
Under its charter, the Committee is required to regularly consider whether it is appropriate to change the independent registered public accounting firm. The Committee to date has determined to retain PwC noting that the firm has continued to exercise independence in challenging management, effectively conducted high-quality audits and consistently improved service delivery.
The Committee has determined that the appointment of PwC as our independent registered public accounting firm for fiscal year 2025 is in the best interest of our company and stockholders. The Committee has appointed PwC in this capacity and our Board has recommended that stockholders ratify the appointment.
OVERSIGHT OF INTERNAL AUDIT
The Committee’s responsibility is to monitor and oversee our internal audit function, reviewing the significant audit results reported to management and management’s responses thereto. In this capacity, the Committee reviews with our Internal Audit leader the overall scope and budget for the internal audit, and regularly monitors the progress of the internal audit in assessing our compliance with Section 404 of the Sarbanes-Oxley Act of 2002, including key findings.
EXECUTIVE SESSIONS
The Committee regularly meets separately in executive session without management present with each of our Internal Audit leader and PwC to review and discuss their evaluations of the overall quality of our accounting and financial reporting and internal control. The Committee also regularly meets, without PwC present, with management, our CFO and our Controller, and meets as needed in executive session with other members of management to discuss significant exposures impacting our financial statements and accounting policies.
STOCKHOLDER FEEDBACK
The Committee has established procedures for the receipt, retention and treatment, on a confidential basis, of complaints regarding our accounting, internal controls and auditing matters. See Complaint Procedures for Accounting and Auditing Matters in the Governance section of this proxy statement. The Committee welcomes feedback regarding its oversight of our audit program. Stockholders may communicate with the Committee by writing to the Audit Committee Chair, c/o Corporate Secretary, 8080 Norton Parkway, Mentor, Ohio 44060.
Ms. Mejia and Mr. Dickson were appointed to the Committee in February and June 2024, respectively. Mr. Lopez and former director Ms. Sullivan served on the Committee through April and December 2024, respectively, and neither of them participated in the review, discussions and recommendation reflected in this Audit Committee Report.
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| Ward H. Dickson, Chair |
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Patrick T. Siewert |
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William R. Wagner |
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Our Board’s Statement in Opposition
Our Board’s Governance and Compensation Committees have carefully considered the proposal and believe that it is unnecessary and not in the best interests of our company and stockholders in light of our existing plans, policies and practices, termination-related executive compensation and other considerations. Our Board recommends that you vote AGAINST this proposal for the reasons stated below.
The proposal is unnecessary because we have already implemented an Executive Officer Cash Severance Policy that provides that we will not pay any cash severance to executive officers exceeding 2.99 times the sum of base salary plus target AIP award without seeking stockholder ratification thereof.
The Compensation Committee adopted an Executive Officer Cash Severance Policy (the “Cash Severance Policy”) effective January 31, 2025 providing that we will not enter into any new employment agreement or severance arrangement after the policy’s effective date with an executive officer (as defined under the Exchange Act) of our company or establish any new severance agreement, plan, arrangement or policy covering any such officer after such date, in each case that provides for a cash severance payment in connection with any termination of his or her employment exceeding 2.99 times the sum of such officer’s base salary plus target AIP award without seeking stockholder ratification of such agreement, plan, arrangement or policy. The Cash Severance Policy was carefully tailored to further our overall compensation philosophy of aligning executive interests with those of our stockholders and providing for appropriate stockholder oversight, while balancing the need to ensure we can provide market-competitive executive compensation, including in the event of termination, to continue attracting and retaining talented executive officers. Our Board believes that this tailored policy is the appropriate approach to align our executive compensation program with stockholder value creation, rather than the overly broad policy sought by the Proponent.
The Compensation Committee has also approved an Amended and Restated Key Executive Change of Control Severance Plan that, among other things, reduces our CEO’s severance multiplier from 3.00 times to 2.99 times his annual base salary and target AIP award for the year of termination, consistent with the Cash Severance Policy.
Stockholders already have ample opportunity to express their views on our executive compensation through our robust stockholder engagement and annual say-on-pay votes, both of which reflect strong support of our executive compensation program.
We semiannually engage with stockholders to solicit feedback on, among other things, our executive compensation program, offering to include directors as participants in scheduled meetings. Our objectives are to maintain regular and thoughtful engagement to directly obtain investor feedback; continue to strengthen our relationships with key investors; and gather perspectives to identify potential improvement opportunities. Our Board and management believe that ongoing stockholder engagement fosters a deeper understanding of evolving investor expectations and helps ensure we continue to reflect best practices.
Our stockholder engagement program seeks to identify potential changes to our executive compensation program that are directly responsive to stockholder feedback and further align our incentives with stockholder expectations. In 2024, we contacted our top 35 investors during the proxy season and the off-season. We engaged with every stockholder who accepted our invitation to meet or otherwise requested a meeting, and our Lead Independent Director led the majority of our off-season engagements. During these meetings, our Lead Independent Director, Governance Committee Chair, and management answered questions and discussed matters of investor interest.
The feedback we have received from stockholders in recent years regarding our executive compensation program has been positive, affirming the Compensation Committee’s strategy and the alignment of pay with performance. Our stockholders have expressed strong say-on-pay support, with average approval in the past five years of 95%.
The Compensation Committee makes changes to our executive compensation program as appropriate to ensure it aligns with our evolving financial profile and business strategies and address feedback from our investors. We believe that the Compensation Committee’s annual review of our AIP and LTI programs and the actions it has taken over time demonstrate our commitment to paying for performance and being responsive to investor feedback.
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VOTING AND MEETING Q&A
ANNUAL REPORT AND PROXY MATERIALS
HOW DO I ACCESS THE 2024 ANNUAL REPORT AND 2025 PROXY MATERIALS?
We have elected to provide access to our proxy materials on the internet. Accordingly, we are sending the Notice of Internet Availability of Proxy Materials (the “Notice”) to our stockholders of record. Brokers, banks and other nominees (collectively, “nominees”) who hold shares on behalf of beneficial owners (also called “street name” holders) will send a similar notice. You can access our proxy materials on the website referred to in the Notice. Instructions on how to request printed proxy materials by mail, including an option to receive paper copies in the future, may be found in the Notice and on the website referred to in the Notice.
On or about March 7, 2025, we will make our 2024 Annual Report and this proxy statement available online and begin mailing the Notice to all stockholders entitled to vote. On or about the same date, we will begin mailing our 2024 Integrated Report, which includes our 2024 Annual Report and 2025 notice and proxy statement, together with a proxy card, to stockholders entitled to vote who have previously requested paper copies. In addition, if you request paper copies of these materials for the first time, they will be mailed within three business days. If you hold your shares in street name, you may request paper copies of the proxy statement and proxy card from your nominee by following the instructions on the notice your nominee provides to you.
Stockholders of record may obtain a copy of this proxy statement without charge by writing to our Corporate Secretary at 8080 Norton Parkway, Mentor, Ohio 44060.
WHAT IS HOUSEHOLDING?
We will send only one 2024 Integrated Report to any address unless we have received instructions to the contrary from any stockholder at that address. Householding allows us reduce our printing and postage costs and prevents multiple proxy materials from being received at your household. If you want an additional copy of our 2024 Integrated Report, you may make your request by writing to our Corporate Secretary at 8080 Norton Parkway, Mentor, Ohio 44060.
If you receive multiple copies and want to receive a single copy in the future, or if you want to revoke your consent to householding and receive separate copies of our proxy statement and annual report in future years, you may call Broadridge Investor Communications Services toll-free at 866.540.7095 in the U.S. and Canada or write them c/o Householding Department, 51 Mercedes Way, Edgewood, New York 11717.
HOW CAN I ACCESS THE ANNUAL REPORT AND PROXY MATERIALS ELECTRONICALLY?
Instead of receiving paper copies of annual reports and proxy materials by mail in the future, you can elect to receive an email with a link to these documents on the internet, which allows you to access them more quickly, save us the cost of printing and mailing them to you, reduce the amount of mail you receive from us and help us preserve environmental resources.
You may enroll to access proxy materials and annual reports electronically for future Annual Meetings by registering online at the following website: https://enroll.icsdelivery.com/avy. If you are voting online, you can follow the links on the voting website to reach the electronic enrollment website.
VOTING
WHO IS SOLICITING MY VOTE?
Our Board is soliciting your vote in connection with the Annual Meeting.
WHO IS ENTITLED TO VOTE?
Stockholders of record as of the close of business on February 24, 2025 are entitled to notice of, and to vote in connection with, the Annual Meeting. Our common stock is the only class of shares outstanding and there were 78,965,996 shares of common stock outstanding on February 24, 2025. The list of stockholders entitled to vote will be available for inspection during the Annual Meeting, as well as starting 10 days before the Annual Meeting during regular business hours at our company headquarters located at 8080 Norton Parkway, Mentor, Ohio 44060. You are entitled to one vote for each share of common stock you held on the record date.
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HOW DO I VOTE?
You may vote by submitting a proxy or voting during the Annual Meeting at www.virtualshareholdermeeting.com/AVY2025. If you are a beneficial holder, you may only vote during the meeting if you properly request and receive a legal proxy in your name from the nominee that holds your shares.
The method of voting by proxy differs depending on whether you are viewing this proxy statement online or reviewing a paper copy.
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If you are viewing this proxy statement online, you may vote your shares by (i) submitting a proxy by telephone or online using the instructions on the website or (ii) requesting a paper copy of the proxy materials and following one of the methods described below. |
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If you are reviewing a paper copy of this proxy statement, you may vote your shares by (i) submitting a proxy by telephone or online using the instructions on the proxy card or (ii) completing, dating and signing the proxy card included with the proxy statement and returning it in the preaddressed, postage-paid envelope provided. |
Whether or not you plan to attend the Annual Meeting, we urge you to vote promptly. We encourage you to vote by telephone or online since these methods immediately record your vote and allow you to confirm that your votes have been properly recorded. Telephone and online votes must be received by 11:59 p.m. Eastern Time on April 23, 2025.
WHAT IF MY SHARES WERE ACQUIRED THROUGH THE DIRECT SHARE PURCHASE AND SALE PROGRAM?
Shares acquired through our Direct Share Purchase and Sale Program may be voted by following the procedures described above.
WHAT IF MY SHARES ARE HELD IN THE EMPLOYEE SAVINGS PLAN?
If you hold shares as a participant in our Employee Savings (401(k)) Plan, your vote serves as a voting instruction to Fidelity Management Trust Company, the trustee of the plan, on how to vote your shares. Your voting instruction must be received by the trustee by 11:59 p.m. Eastern Time on April 21, 2025.
If the trustee does not receive your instruction in a timely manner, your shares will be voted in the same proportion as the shares voted by plan participants who timely furnish instructions. Shares of our common stock that have not been allocated to participant accounts will also be voted by the trustee in the same proportion as the shares voted by plan participants who timely furnish instructions.
HOW DO I REVOKE MY PROXY OR CHANGE MY VOTE AFTER I HAVE VOTED?
If you give a proxy pursuant to this solicitation, you may revoke it before it is acted upon during the Annual Meeting by (i) submitting another proxy by telephone or online by the deadline indicated above (only your last instructions will be counted); (ii) sending a later dated paper proxy; or (iii) if you are entitled to do so, voting during the Annual Meeting. Simply attending the Annual Meeting will not revoke your proxy.
If your shares are held in street name, you may only change your vote by submitting new voting instructions to your nominee. You must contact your nominee to find out how to change your vote. Shares held in our Employee Savings Plan cannot be changed or revoked after 11:59 p.m. Eastern Time on April 21, 2025, nor can they be voted during the Annual Meeting.
IS MY VOTE CONFIDENTIAL?
Except in contested proxy solicitations, when required by law or as authorized by you (such as by making a written comment on your proxy card, in which case the comment, but not your vote, may be shared with our company), your vote or voting instruction is confidential and will not be disclosed other than to the broker, trustee, agent or inspector of election tabulating your vote.
HOW WILL VOTES BE COUNTED?
Votes for the Annual Meeting will be tabulated by a representative from Broadridge Financial Solutions, Inc., the independent inspector of election appointed by our Board. The inspector of election will also determine whether a quorum is present; shares represented by proxies that reflect abstentions or broker non-votes (which are shares held by a nominee that are represented, but with respect to which the nominee neither has discretionary authority to vote nor has
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| 104 |
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2025 Proxy Statement | Avery Dennison Corporation |
been given actual authority to vote on a particular proposal) will be counted as shares that are present and entitled to vote for purposes of determining the presence of a quorum. Proposals 1, 2 and 4 are non-routine under the rules of the NYSE and Proposal 3 is routine. Nominees are prohibited from voting on non-routine proposals in the absence of instructions from the beneficial owners of the shares; as a result, if you hold your shares in street name and do not timely submit voting instructions to your nominee, your shares will not be voted on Proposal 1, election of directors; Proposal 2, approval, on an advisory basis, of executive compensation; or Proposal 4, vote on stockholder proposal for a stockholder approval requirement for excessive golden parachutes. We urge you to promptly provide voting instructions to your nominee so that your vote is counted.
The vote required to approve each of the Annual Meeting proposals, as well as the impact of abstentions and broker non-votes, is shown in the chart below.
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| |
|
PROPOSAL |
|
VOTE REQUIRED |
|
IMPACT OF ABSENTIONS |
|
IMPACT OF
BROKER NON-VOTES |
|
|
|
|
|
| 1 |
|
Election of directors |
|
Majority of votes cast |
|
Not counted as votes cast; no impact on outcome |
|
Not counted as votes cast; no impact on outcome |
|
|
|
|
|
| 2 |
|
Advisory vote to approve executive compensation |
|
Majority of shares represented and entitled to vote |
|
Negative impact on outcome |
|
Not counted as represented and entitled to vote;
no impact on outcome |
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|
|
|
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| 3 |
|
Ratification of appointment of PwC as independent registered public accounting firm for FY 2025 |
|
Majority of shares represented and entitled to vote |
|
Negative impact on outcome |
|
Not applicable |
|
|
|
|
|
| 4 |
|
Vote on stockholder proposal for stockholder approval requirement for excessive golden parachutes, if properly presented during the meeting |
|
Majority of shares represented and entitled to vote |
|
Negative impact on outcome |
|
Not counted as represented and entitled to vote;
no impact on outcome |
WHAT IF THERE IS ADDITIONAL BUSINESS TO BE VOTED ON?
As of the date of this proxy statement, we know of no other business to be presented for consideration during the meeting. If any other business properly comes before the meeting, your vote will be cast on any such other business by the individuals acting pursuant to your proxy in their best judgment.
HOW DO I FIND VOTE RESULTS?
We expect to announce preliminary voting results during the Annual Meeting and report final voting results in a Current Report on Form 8-K filed with the SEC on or before April 30, 2025.
ANNUAL MEETING INFORMATION
WHAT IS THE TIME, DATE AND FORMAT OF THE ANNUAL MEETING?
The Annual Meeting will take place at 2:30 p.m. Eastern Time on April 24, 2025. To allow stockholders to attend without the time and expense of doing so in person, the meeting will be held virtually, with attendance via the internet.
HOW CAN I ATTEND THE VIRTUAL MEETING?
To attend the virtual Annual Meeting, you will need to log in to the virtual meeting website at www.virtualshareholdermeeting.com/AVY2025 using the 16-digit control number on your Notice, proxy card or voting instruction form. Online access to the live audio webcast of the Annual Meeting will open at 2:15 p.m. Eastern Time to allow time for you to log in and test your device’s audio system. We encourage you to access the meeting in advance of its start time as we will begin promptly.
HOW DO I ASK QUESTIONS DURING THE MEETING?
We have designed the virtual Annual Meeting to ensure that you have the same rights and opportunities to participate as you would at an in-person meeting, using an online platform that allows you to attend, vote and ask questions. Only stockholders as of the record date or their properly appointed proxies may ask questions during the meeting, and our Chairman may limit the length of discussion on any particular matter. During the Annual Meeting, you can view our Ground Rules for Conduct of Meeting and submit questions on the meeting website.
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| Avery Dennison Corporation | 2025 Proxy Statement |
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105 |
After the business portion of the Annual Meeting concludes and the meeting is adjourned, we will hold a Q&A session during which we intend to answer all questions submitted timely that are pertinent to our company and the proposals being brought before stockholder vote, as time permits and in accordance with our Ground Rules for Conduct of Meeting. Questions and answers will be grouped by topic and substantially similar questions will be answered only once. To ensure all questions are able to be addressed, we will respond to no more than three questions from any single stockholder. Answers to questions not able to be addressed, if any, will be posted promptly after the meeting on the investors section of our website.
As a result of time constraints and other considerations, we cannot assure you that every stockholder wishing to address the meeting will have the opportunity to do so. However, stockholders are invited to direct inquiries or comments regarding business matters to our Investor Relations department by email to investorcom@averydennison.com or by mail to 8080 Norton Parkway, Mentor, Ohio 44060. In addition, stockholders wishing to address matters to our Board or any of its members may do so as described under Contacting Our Board in the Our Board of Directors section of this proxy statement.
WHAT DO I DO IF I AM HAVING TECHNICAL ISSUES ACCESSING OR PARTICIPATING IN THE MEETING?
Beginning 15 minutes prior to, and during, the Annual Meeting, we will have support available to assist stockholders with any technical difficulties they may have accessing or hearing the virtual meeting. If you encounter any difficulty accessing, or during, the virtual meeting, please call the support team at 1.844.986.0822 (toll-free in the U.S. and Canada) or +1.303.562.9302 (for all other attendees).
HOW ARE PROXIES BEING SOLICITED?
We will pay the costs related to our solicitation of proxies and reimburse banks, brokers and other custodians, nominees and fiduciaries for reasonable out-of-pocket expenses they incur in forwarding our proxy materials to beneficial stockholders. We have retained Sodali & Co. to assist in soliciting proxies for a fee of $12,000, plus reimbursement of out-of-pocket expenses incident to preparing and mailing our proxy materials. Certain of our employees that may solicit proxies by telephone or email will not receive additional compensation for their efforts. You can help reduce our solicitation costs by consenting to access our proxy materials electronically and voting promptly.
MATTERS RELATED TO 2026 ANNUAL MEETING
HOW DO I SUBMIT PROPOSALS FOR POTENTIAL CONSIDERATION AT THE 2026 ANNUAL MEETING?
To propose business satisfying the eligibility requirements of SEC Rule 14a-8 to be considered for inclusion in our proxy statement for the 2026 Annual Meeting, you must provide notice so it is received at our principal executive offices on or before November 7, 2025. If you wish to nominate persons for election to our Board or bring any other business before an annual meeting under the advance notice provisions or our Bylaws, you must provide written notice to our Corporate Secretary at our principal executive offices in writing 90 to 120 days prior to the first anniversary of the preceding year’s annual meeting (with respect to the 2026 Annual Meeting, no earlier than December 25, 2025 and no later than January 24, 2026) and comply with the other requirements set forth in our Bylaws.
Your notice must include, among other things, the information summarized below and described in greater detail in Article II, Section 14 of our Bylaws, which are available under Governance Documents in the investors section of our website.
| |
• |
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As to each person who you propose to nominate for election or reelection as a director: |
| |
• |
|
All information relating to the person that is required to be disclosed in solicitations of proxies for election of directors in an election contest or is otherwise required pursuant to Regulation 14 under the Exchange Act |
| |
• |
|
The person’s written consent to be named in our proxy statement and accompanying proxy card as a nominee and serve as a director if elected for the full term until the next meeting at which such nominee would face reelection |
| |
• |
|
All information with respect to such person that would be required to be set forth in a stockholder’s notice pursuant to our Bylaws if such person were a stockholder |
| |
• |
|
A description of all direct and indirect material interest in any material contract or agreement between or among any stockholder, on the one hand, and the nominee, nominee’s affiliates or any other participants in the solicitation, on the other hand, as more particularly set forth in our Bylaws |
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| 106 |
|
2025 Proxy Statement | Avery Dennison Corporation |
Pay vs Performance Disclosure - USD ($)
|
12 Months Ended |
Dec. 28, 2024 |
Dec. 30, 2023 |
Dec. 31, 2022 |
Jan. 01, 2022 |
Jan. 02, 2021 |
| Pay vs Performance Disclosure |
|
|
|
|
|
| Pay vs Performance Disclosure, Table |
PAY VS. PERFORMANCE DISCLOSURE The table below reflects information regarding the compensation of our NEOs and our financial performance for the last five fiscal years in accordance with SEC rules.
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year |
|
Summary Compensation Table Total for Stander ($) (1) |
|
Compensation Actually Paid to Stander ($) (2) |
|
Summary Compensation Table Total for Butier ($) (1) |
|
Compensation Actually Paid to Butier ($) (2) |
|
Average Summary Compensation Table Total for Non-CEO |
|
Average
Compensation
Actually Paid to |
|
Value of Initial Fixed $100
Investments Based on: |
|
Net Income ($) |
|
|
| |
Total
Stockholder
Return ($) |
|
Peer Group Total Stockholder Return ($) (3) |
|
|
|
|
|
|
|
|
|
|
|
2024 |
|
$9,853,372 |
|
$7,425,336 |
|
– |
|
– |
|
$3,102,488 |
|
$1,321,463 |
|
$155.20 |
|
$136.22 |
|
$704,936,000 |
|
$9.43 |
|
|
|
|
|
|
|
|
|
|
|
2023 |
|
$6,070,962 |
|
$7,216,077 |
|
$ 9,700,108 |
|
$10,879,032 |
|
$2,107,852 |
|
$ 351,353 |
|
$165.02 |
|
$118.91 |
|
$502,988,000 |
|
$7.90 |
|
|
|
|
|
|
|
|
|
|
|
2022 |
|
– |
|
– |
|
$ 9,107,739 |
|
$ 7,588,568 |
|
$2,405,277 |
|
$2,220,289 |
|
$145.19 |
|
$110.49 |
|
$757,092,000 |
|
$9.15 |
|
|
|
|
|
|
|
|
|
|
|
2021 |
|
– |
|
– |
|
$12,433,721 |
|
$31,508,041 |
|
$2,342,467 |
|
$5,263,092 |
|
$170.89 |
|
$134.41 |
|
$740,087,000 |
|
$8.91 |
|
|
|
|
|
|
|
|
|
|
|
2020 |
|
– |
|
– |
|
$ 8,709,348 |
|
$13,337,289 |
|
$2,248,966 |
|
$2,725,777 |
|
$120.83 |
|
$121.14 |
|
$555,863,000 |
|
$7.10 |
| |
(1) |
For each fiscal year, represents amount reported for our CEO(s) and average amount reported for our non-CEO NEOs, in each case in the Total column of the Summary Compensation Table. Our NEOs for each of these fiscal years are shown below. |
|
|
|
|
|
Year |
|
CEO(s) |
|
|
| 2024 |
|
Deon Stander |
|
Danny Allouche, Gregory Lovins, Mitchell Butier, Francisco Melo and Ryan Yost |
| 2023 |
|
Deon Stande r/Mitchell Butier |
|
Gregory Lovins, Francisco Melo, Deena Baker-Nel and Nicholas Colisto |
| 2022 |
|
Mitchell Butier |
|
Deon Stander, Gregory Lovins, Deena Baker-Nel and Ignacio Walker |
| 2021 |
|
Mitchell Butier |
|
Deon Stander, Gregory Lovins, Deena Baker-Nel and Ignacio Walker |
| 2020 |
|
Mitchell Butier |
|
Deon Stander, Gregory Lovins, Anne Hill and Susan Miller |
| |
(2) |
Amounts represent Compensation Actually Paid to our CEO(s) or the average Compensation Actually Paid to our non-CEO NEOs, in each case which represents amounts reported in the Total column of the Summary Compensation Table for the applicable fiscal year. For 2024, amounts were adjusted as shown below. Fair value or change in fair value, as applicable, of equity awards in the Compensation Actually Paid columns was determined as follows: (i) for RSUs, the closing price of our common stock on the fiscal year-end date, or, in the case of vesting RSUs, the closing price of our common stock on the applicable vesting date; (ii) for the performance condition component of PUs, the same valuation methodology as RSUs except that year-end values were multiplied by a factor reflecting achievement of the probable outcome of the respective cumulative EVA performance objective as of the applicable measurement date; (iii) for the market condition component of PUs and for MSUs, using the Monte-Carlo simulation method to estimate the probability of achieving the respective relative and absolute TSR performance objective, respectively, as of the applicable measurement date; and (iv) for stock options, using the Black-Scholes pricing model as of the applicable measurement date. For information on the inputs to our Monte-Carlo simulations, see footnote (2) to our 2024 Summary Compensation Table. For purposes of these adjustments, awards to retirement-eligible NEOs are considered vested only at the time of retirement. |
|
|
|
|
|
|
|
|
|
| |
|
2024 |
|
|
|
|
Adjustments |
|
Stander |
|
|
Average of |
|
|
|
|
Decrease for amounts reported under Stock Awards and Option Awards columns in 2024 Summary Compensation Table |
|
$ |
(6,643,355 |
) |
|
$ |
(2,040,463 |
) |
|
|
|
Increase based on ASC 718 fair value of awards granted during fiscal year 2024 that remained unvested as of fiscal year-end 2024, determined as of fiscal year-end 2024 |
|
|
6,166,731 |
|
|
|
1,832,833 |
|
|
|
|
Increase/Decrease based on ASC 718 fair value of awards granted during fiscal year 2024 that vested during fiscal year, determined as of vesting date |
|
|
– |
|
|
|
– |
|
|
|
|
Decrease for awards granted during prior fiscal years that were outstanding and unvested as of fiscal year-end 2024, determined based on change in ASC 718 fair value from prior fiscal year-end to fiscal year-end 2024 |
|
|
(1,677,949 |
) |
|
|
(1,272,523 |
) |
|
|
|
Decrease for awards granted during prior fiscal years that vested during fiscal year 2024, determined based on change in ASC 718 fair value from prior fiscal year-end to vesting date |
|
|
(273,463 |
) |
|
|
(297,664 |
) |
|
|
|
Decrease for change in the actuarial present values reported under Change in Pension Value and NQDC Earnings column of 2024 Summary Compensation Table |
|
|
– |
|
|
|
(3,208 |
) |
|
|
|
Increase/Decrease for service cost and, if applicable, prior service cost, for pension plans |
|
|
– |
|
|
|
– |
|
|
|
|
Total Adjustments |
|
$ |
(2,428,036 |
) |
|
$ |
(1,781,025 |
) |
| |
(3) |
Peer Group represents the Dow Jones U.S. Containers and Packaging Index. |
| |
(4) |
Adjusted EPS is a non-GAAP financial measure reconciled from GAAP in Appendix A of this proxy statement. |
|
|
|
|
|
| Company Selected Measure Name |
Adjusted EPS
|
|
|
|
|
| Named Executive Officers, Footnote |
| |
(1) |
For each fiscal year, represents amount reported for our CEO(s) and average amount reported for our non-CEO NEOs, in each case in the Total column of the Summary Compensation Table. Our NEOs for each of these fiscal years are shown below. |
|
|
|
|
|
Year |
|
CEO(s) |
|
|
| 2024 |
|
Deon Stander |
|
Danny Allouche, Gregory Lovins, Mitchell Butier, Francisco Melo and Ryan Yost |
| 2023 |
|
Deon Stande r/Mitchell Butier |
|
Gregory Lovins, Francisco Melo, Deena Baker-Nel and Nicholas Colisto |
| 2022 |
|
Mitchell Butier |
|
Deon Stander, Gregory Lovins, Deena Baker-Nel and Ignacio Walker |
| 2021 |
|
Mitchell Butier |
|
Deon Stander, Gregory Lovins, Deena Baker-Nel and Ignacio Walker |
| 2020 |
|
Mitchell Butier |
|
Deon Stander, Gregory Lovins, Anne Hill and Susan Miller |
|
|
|
|
|
| Peer Group Issuers, Footnote |
Peer Group represents the Dow Jones U.S. Containers and Packaging Index.
|
|
|
|
|
| Adjustment To PEO Compensation, Footnote |
| |
(2) |
Amounts represent Compensation Actually Paid to our CEO(s) or the average Compensation Actually Paid to our non-CEO NEOs, in each case which represents amounts reported in the Total column of the Summary Compensation Table for the applicable fiscal year. For 2024, amounts were adjusted as shown below. Fair value or change in fair value, as applicable, of equity awards in the Compensation Actually Paid columns was determined as follows: (i) for RSUs, the closing price of our common stock on the fiscal year-end date, or, in the case of vesting RSUs, the closing price of our common stock on the applicable vesting date; (ii) for the performance condition component of PUs, the same valuation methodology as RSUs except that year-end values were multiplied by a factor reflecting achievement of the probable outcome of the respective cumulative EVA performance objective as of the applicable measurement date; (iii) for the market condition component of PUs and for MSUs, using the Monte-Carlo simulation method to estimate the probability of achieving the respective relative and absolute TSR performance objective, respectively, as of the applicable measurement date; and (iv) for stock options, using the Black-Scholes pricing model as of the applicable measurement date. For information on the inputs to our Monte-Carlo simulations, see footnote (2) to our 2024 Summary Compensation Table. For purposes of these adjustments, awards to retirement-eligible NEOs are considered vested only at the time of retirement. |
|
|
|
|
|
|
|
|
|
| |
|
2024 |
|
|
|
|
Adjustments |
|
Stander |
|
|
Average of |
|
|
|
|
Decrease for amounts reported under Stock Awards and Option Awards columns in 2024 Summary Compensation Table |
|
$ |
(6,643,355 |
) |
|
$ |
(2,040,463 |
) |
|
|
|
Increase based on ASC 718 fair value of awards granted during fiscal year 2024 that remained unvested as of fiscal year-end 2024, determined as of fiscal year-end 2024 |
|
|
6,166,731 |
|
|
|
1,832,833 |
|
|
|
|
Increase/Decrease based on ASC 718 fair value of awards granted during fiscal year 2024 that vested during fiscal year, determined as of vesting date |
|
|
– |
|
|
|
– |
|
|
|
|
Decrease for awards granted during prior fiscal years that were outstanding and unvested as of fiscal year-end 2024, determined based on change in ASC 718 fair value from prior fiscal year-end to fiscal year-end 2024 |
|
|
(1,677,949 |
) |
|
|
(1,272,523 |
) |
|
|
|
Decrease for awards granted during prior fiscal years that vested during fiscal year 2024, determined based on change in ASC 718 fair value from prior fiscal year-end to vesting date |
|
|
(273,463 |
) |
|
|
(297,664 |
) |
|
|
|
Decrease for change in the actuarial present values reported under Change in Pension Value and NQDC Earnings column of 2024 Summary Compensation Table |
|
|
– |
|
|
|
(3,208 |
) |
|
|
|
Increase/Decrease for service cost and, if applicable, prior service cost, for pension plans |
|
|
– |
|
|
|
– |
|
|
|
|
Total Adjustments |
|
$ |
(2,428,036 |
) |
|
$ |
(1,781,025 |
) |
|
|
|
|
|
| Non-PEO NEO Average Total Compensation Amount |
$ 3,102,488
|
$ 2,107,852
|
$ 2,405,277
|
$ 2,342,467
|
$ 2,248,966
|
| Non-PEO NEO Average Compensation Actually Paid Amount |
$ 1,321,463
|
351,353
|
2,220,289
|
5,263,092
|
2,725,777
|
| Adjustment to Non-PEO NEO Compensation Footnote |
| |
(2) |
Amounts represent Compensation Actually Paid to our CEO(s) or the average Compensation Actually Paid to our non-CEO NEOs, in each case which represents amounts reported in the Total column of the Summary Compensation Table for the applicable fiscal year. For 2024, amounts were adjusted as shown below. Fair value or change in fair value, as applicable, of equity awards in the Compensation Actually Paid columns was determined as follows: (i) for RSUs, the closing price of our common stock on the fiscal year-end date, or, in the case of vesting RSUs, the closing price of our common stock on the applicable vesting date; (ii) for the performance condition component of PUs, the same valuation methodology as RSUs except that year-end values were multiplied by a factor reflecting achievement of the probable outcome of the respective cumulative EVA performance objective as of the applicable measurement date; (iii) for the market condition component of PUs and for MSUs, using the Monte-Carlo simulation method to estimate the probability of achieving the respective relative and absolute TSR performance objective, respectively, as of the applicable measurement date; and (iv) for stock options, using the Black-Scholes pricing model as of the applicable measurement date. For information on the inputs to our Monte-Carlo simulations, see footnote (2) to our 2024 Summary Compensation Table. For purposes of these adjustments, awards to retirement-eligible NEOs are considered vested only at the time of retirement. |
|
|
|
|
|
|
|
|
|
| |
|
2024 |
|
|
|
|
Adjustments |
|
Stander |
|
|
Average of |
|
|
|
|
Decrease for amounts reported under Stock Awards and Option Awards columns in 2024 Summary Compensation Table |
|
$ |
(6,643,355 |
) |
|
$ |
(2,040,463 |
) |
|
|
|
Increase based on ASC 718 fair value of awards granted during fiscal year 2024 that remained unvested as of fiscal year-end 2024, determined as of fiscal year-end 2024 |
|
|
6,166,731 |
|
|
|
1,832,833 |
|
|
|
|
Increase/Decrease based on ASC 718 fair value of awards granted during fiscal year 2024 that vested during fiscal year, determined as of vesting date |
|
|
– |
|
|
|
– |
|
|
|
|
Decrease for awards granted during prior fiscal years that were outstanding and unvested as of fiscal year-end 2024, determined based on change in ASC 718 fair value from prior fiscal year-end to fiscal year-end 2024 |
|
|
(1,677,949 |
) |
|
|
(1,272,523 |
) |
|
|
|
Decrease for awards granted during prior fiscal years that vested during fiscal year 2024, determined based on change in ASC 718 fair value from prior fiscal year-end to vesting date |
|
|
(273,463 |
) |
|
|
(297,664 |
) |
|
|
|
Decrease for change in the actuarial present values reported under Change in Pension Value and NQDC Earnings column of 2024 Summary Compensation Table |
|
|
– |
|
|
|
(3,208 |
) |
|
|
|
Increase/Decrease for service cost and, if applicable, prior service cost, for pension plans |
|
|
– |
|
|
|
– |
|
|
|
|
Total Adjustments |
|
$ |
(2,428,036 |
) |
|
$ |
(1,781,025 |
) |
|
|
|
|
|
| Compensation Actually Paid vs. Total Shareholder Return |
|
|
|
|
|
| Compensation Actually Paid vs. Net Income |
|
|
|
|
|
| Compensation Actually Paid vs. Company Selected Measure |
|
|
|
|
|
| Total Shareholder Return Vs Peer Group |
|
|
|
|
|
| Tabular List, Table |
Pay vs. Performance Financial Performance Measures We believe the financial performance measures shown below, all of which are performance objectives used in our executive compensation program, were the most important in linking CAP to our NEOs for 2024. For additional information regarding these measures, including reconciliations of non-GAAP financial measures from GAAP, see the Compensation and Discussion Analysis and Appendix A sections of this proxy statement.
| |
• |
|
Absolute and Relative TSR |
| |
• |
|
Adjusted Free Cash Flow |
|
|
|
|
|
| Total Shareholder Return Amount |
$ 155.2
|
165.02
|
145.19
|
170.89
|
120.83
|
| Peer Group Total Shareholder Return Amount |
136.22
|
118.91
|
110.49
|
134.41
|
121.14
|
| Net Income (Loss) |
$ 704,936,000
|
$ 502,988,000
|
$ 757,092,000
|
$ 740,087,000
|
$ 555,863,000
|
| Company Selected Measure Amount |
9.43
|
7.9
|
9.15
|
8.91
|
7.1
|
| Measure:: 1 |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Name |
Absolute and Relative TSR
|
|
|
|
|
| Measure:: 2 |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Name |
Adjusted EPS
|
|
|
|
|
| Non-GAAP Measure Description |
Adjusted EPS is a non-GAAP financial measure reconciled from GAAP in Appendix A of this proxy statement.
|
|
|
|
|
| Measure:: 3 |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Name |
Cumulative EVA
|
|
|
|
|
| Measure:: 4 |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Name |
Adjusted Sales Growth
|
|
|
|
|
| Measure:: 5 |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Name |
Adjusted Free Cash Flow
|
|
|
|
|
| Deon Stander [Member] |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| PEO Total Compensation Amount |
$ 9,853,372
|
$ 6,070,962
|
|
|
|
| PEO Actually Paid Compensation Amount |
$ 7,425,336
|
$ 7,216,077
|
|
|
|
| PEO Name |
Deon Stander
|
Deon Stander
|
|
|
|
| Mitchell Butier [Member] |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| PEO Total Compensation Amount |
|
$ 9,700,108
|
$ 9,107,739
|
$ 12,433,721
|
$ 8,709,348
|
| PEO Actually Paid Compensation Amount |
|
$ 10,879,032
|
$ 7,588,568
|
$ 31,508,041
|
$ 13,337,289
|
| PEO Name |
|
Mitchell Butier
|
Mitchell Butier
|
Mitchell Butier
|
Mitchell Butier
|
| PEO | Deon Stander [Member] | Equity Awards Adjustments |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Adjustment to Compensation, Amount |
$ (2,428,036)
|
|
|
|
|
| PEO | Deon Stander [Member] | Aggregate Grant Date Fair Value of Equity Award Amounts Reported in Summary Compensation Table |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Adjustment to Compensation, Amount |
(6,643,355)
|
|
|
|
|
| PEO | Deon Stander [Member] | Year-end Fair Value of Equity Awards Granted in Covered Year that are Outstanding and Unvested |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Adjustment to Compensation, Amount |
6,166,731
|
|
|
|
|
| PEO | Deon Stander [Member] | Year-over-Year Change in Fair Value of Equity Awards Granted in Prior Years That are Outstanding and Unvested |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Adjustment to Compensation, Amount |
(1,677,949)
|
|
|
|
|
| PEO | Deon Stander [Member] | Change in Fair Value as of Vesting Date of Prior Year Equity Awards Vested in Covered Year |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Adjustment to Compensation, Amount |
(273,463)
|
|
|
|
|
| Non-PEO NEO | Aggregate Change in Present Value of Accumulated Benefit for All Pension Plans Reported in Summary Compensation Table |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Adjustment to Compensation, Amount |
(3,208)
|
|
|
|
|
| Non-PEO NEO | Equity Awards Adjustments |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Adjustment to Compensation, Amount |
(1,781,025)
|
|
|
|
|
| Non-PEO NEO | Aggregate Grant Date Fair Value of Equity Award Amounts Reported in Summary Compensation Table |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Adjustment to Compensation, Amount |
(2,040,463)
|
|
|
|
|
| Non-PEO NEO | Year-end Fair Value of Equity Awards Granted in Covered Year that are Outstanding and Unvested |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Adjustment to Compensation, Amount |
1,832,833
|
|
|
|
|
| Non-PEO NEO | Year-over-Year Change in Fair Value of Equity Awards Granted in Prior Years That are Outstanding and Unvested |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Adjustment to Compensation, Amount |
(1,272,523)
|
|
|
|
|
| Non-PEO NEO | Change in Fair Value as of Vesting Date of Prior Year Equity Awards Vested in Covered Year |
|
|
|
|
|
| Pay vs Performance Disclosure |
|
|
|
|
|
| Adjustment to Compensation, Amount |
$ (297,664)
|
|
|
|
|
