Directors who are employees of the Company receive no additional compensation for serving on the Board or its Committees.
The Company provides annual compensation to non-employee Directors as follows:
The Company provides to the non-employee Directors:
- an annual cash retainer of $70,000;
- $1,500 for each Board meeting attended;
- $1,500 for each Committee meeting attended;
- an annual cash retainer of $15,000 to the Chairs of Committees of the Board; and
- an annual cash retainer of $25,000 to the Presiding Director ($10,000 in the event that the Presiding Director is also the Chair of a Committee).
The annual cash compensation to be provided in respect of 2017 remains unchanged from that provided in respect of 2016.
The most significant portion of non-employee Director compensation is the annual equity grant payable as an annual deferred share award. In respect of 2017, each non-employee Director will receive an annual deferred share credit of $150,000 pursuant to the Director Deferred Stock Ownership Plan, increased from $115,000 as described below. The earned deferred share credit of $115,000 in respect of fiscal year 2015 was paid in early 2016 under this Plan. This $115,000 was credited as 1,213.08 deferred shares based on the closing price of the Company’s common stock on January 4, 2016 of $94.80. The earned deferred share credit of $115,000 in respect of 2016 was paid in 2017 under this Plan. This $115,000 was credited as 1,060.98 deferred shares based on the closing price of the Company’s common stock on January 3, 2017 of $108.39.
These deferred share credits are payable in shares of the Company’s common stock following a Director’s termination of Board membership. This Plan also permits Directors to elect to receive all or part of their annual cash retainer and Board and Committee fees in deferred shares of common stock in lieu of these cash payments. For 2017, the Company has written agreements with Ms. Ochoa-Brillembourg and Messrs. Haldeman, Schmoke and Thornburgh and Sir Michael Rake to receive all or part of these cash payments as deferred shares. The awards outstanding under this Plan as of December 31, 2016, further described on pages 86 and 87 of the 2017 Proxy Statement, are as follows:
|Name||Number of Shares|
|Sir Winfried Bischoff||34,086|
|William D. Green||7,817|
|Charles E. Haldeman, Jr.||10,450|
|Monique F. Leroux(a)||--|
|Robert P. McGraw(b)||36,433|
|Maria R. Morris(a)||--|
|Sir Michael Rake||19,668|
|Edward B. Rust, Jr.||66,572|
|Kurt L. Schmoke||39,500|
|Richard E. Thornburgh||5,767|
a) Ms. Leroux and Ms. Morris joined the Board in 2016 and thus did not receive any deferred share credits as Directors in 2016.
b) Due to their retirement from the Board, Mr. McGraw’s balance of 36,913 shares and Mr. Taurel’s balance of 45,709 shares were paid following the 2016 Annual Meeting.
Other Director Plans and Other Compensation
Directors may elect to defer all or part of their annual cash retainer and Board and Committee fees under the Director Deferred Compensation Plan. For 2017, the Company has written agreements to defer cash payments under this Plan with Messrs. Green and Schmoke. Interest is payable on the deferred cash amount at 120% of the applicable Federal Long-Term Rate as prescribed by the Internal Revenue Service in December of the year prior to the year in which the Director compensation is credited.
Our non-employee Directors are reimbursed for tuition and related expenses for continuing director education courses. Our Directors may also participate in our director charitable matching program with respect to contributions made to the S&P Global Political Action Committee (“S&P Global PAC”). Under the S&P Global PAC program, the Company contributes funds to a charitable organization of the Director’s choice that match the Director’s contribution to the S&P Global PAC, up to a maximum of $5,000 per annum.
Additionally, our Directors may participate in the charitable S&P Global Matching Gift Program up to a maximum participant donation of $3,000 (or the currency equivalent) in the aggregate per year. This program is generally available to all our employees and Directors as well as retired employees or directors for up to three years following their retirement.
Director Stock Ownership Guidelines
Under the Company’s By-Laws, each Director is required to own or acquire 400 shares of the Company’s common stock within 90 days of his or her election to the Board and to hold such shares through his or her entire tenure as a Director. Additionally, under the Company’s Non-Employee Director Stock Ownership Guidelines, each non-employee Director is required to own or acquire, within five years of election to the Company’s Board of Directors, shares of common stock of the Company (including deferred share units held under the Director Deferred Stock Ownership Plan) having a market value of at least five times (5x) the annual cash retainer for serving as a Director of the Company at all times during his or her tenure.
Based on the holdings of shares and deferred share units under the Director Deferred Stock Ownership Plan, as of February 24, 2017, each Director was in compliance with the minimum holding requirement under the Company’s Non-Employee Director Stock Ownership Guidelines (taking into account the applicable five-year transition period).
The full policy can be viewed and downloaded from the Corporate Governance section of the Company’s Investor Relations website here.
Source: Proxy Statement, filed March 13, 2017