UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C., 20549

SCHEDULE 14A
(RULE 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934 (AMENDMENT NO.  )

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ESCO TECHNOLOGIES INC.

(Name of Registrant as Specified in Its Charter)

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

Payment of filing fee (Check the appropriate box):

ESCO TECHNOLOGIES INC.

ESCO Technologies Inc. 9900A Clayton Road St. Louis, MO 63124 Vic Richey Chairman, Chief Executive Officer and President

9900A Clayton Road, St. Louis, Missouri 63124

NOTICE AND PROXY STATEMENT
FOR THE 2020 ANNUAL MEETING OF SHAREHOLDERS
OF ESCO TECHNOLOGIES INC.

St.

	December 14, 2022
	Dear Fellow Shareholders, I am pleased to invite you to attend our 2023 Annual Meeting of Shareholders of ESCO Technologies Inc., to be held on Friday, February 3, 2023 at the Westlake Village Inn, 31943 Agoura Road, Westlake Village, California 91361, at 8:00 a.m. Pacific Time. The accompanying Notice of Annual Meeting and Proxy Statement describe the items of business that will be discussed and voted on at the Meeting. We value your input and encourage you to review this material as well as our Annual Report for fiscal 2022 and to vote your shares of common stock. You have a choice of voting online, by telephone, by returning the enclosed proxy card by mail, or at the Meeting. Fiscal 2022 was a remarkable year for ESCO as we successfully navigated a challenging economic environment to deliver 30 percent growth in net earnings and record revenue, orders, and year-end backlog. Our team of dedicated employees worked diligently throughout the year to manage persistent supply chain disruptions, inflationary pressures, and labor shortages. Through teamwork and persistence, we found ways to support our customers and deliver record operation results. The hard work we have done during this challenging time has us well-positioned to drive profitable growth moving forward, and we are excited about the opportunities ahead as we strive to deliver innovative solutions to the industries we serve. We appreciate your investment in ESCO and remain committed to effectively managing the company to deliver long-term shareholder value. On behalf of the Board of Directors and all of us at ESCO, thank you for your ongoing support. Sincerely, Vic Richey  Chairman, Chief Executive Officer and President

Notice of Annual Meeting of Shareholders

St. Louis, Missouri

December 11, 201914, 2022

TO THE SHAREHOLDERS OF

To the Shareholders of ESCO TECHNOLOGIES INC.Technologies Inc.:

The 20202023 Annual Meeting of the shareholders of ESCO Technologies Inc. will be held on Friday, January 31, 2020February 3, 2023 at 1500 Fifth Avenue South, Naples, Florida 34102, the Westlake Village Inn, 31943 Agoura Road, Westlake Village, California 91361, beginning at 9:8:00 a.m. EasternPacific Time,, for the following purposes:

Your Board of Directors recommends that you vote “FOR” all of the above director nominees and “FOR” Proposals 2 and 3.

Shareholders of record at the close of business on December 2, 2019November 28, 2022 are entitled to vote at the Meeting.

Information about each of the above Proposals, as well as instructions for voting and additional relevant information concerning the Company, isare set forth in the accompanying Proxy Statement and in the Company’s 2019 Annual Report to Shareholders. Instructions for voting, as well as for receiving a paper copy of the proxy materials, are set forth in the “Important Notice Regarding the Availability of Proxy Materials” for the Meeting sent to all shareholders entitled to vote at the Meeting beginning on or about December 11, 2019.14, 2022.

Thank you for your ongoing support.By Order Of The Board Of Directors,

David M. Schatz

Senior Vice President, General Counsel and Secretary

	ESCO Technologies Inc.This Notice, the Proxy Statement attached to this Notice and our Annual Report to Shareholders for the fiscal year ended September 30, 2022 are available electronically at www.envisionreports.com/ESE and on our website at www.escotechnologies.com.
	By:
		Victor L. Richey Chairman, Chief Executive Officer and PresidentEven if you plan to attend the Meeting in person, PLEASE VOTE:
	●	Electronically via the Internet at www.investorvote.com/ESE; or
	●	By telephone within the United States, U.S. territories or Canada at 1 800 652 VOTE (8683); or
Alyson S. Barclay Secretary	●

Even if you plan to attend the Meeting in person, please vote electronically via the Internet atwww.investorvote.com/ESE or by telephone within the United States, U.S. territories or Canada at 1-800-652-VOTE (8683), or ifIf you requested paper or e-mail copies of the proxy materials, please complete, sign, date and return the proxy card.

TABLE OF CONTENTS

Proxy Statement Table of Contents

PROXY STATEMENT

Proxy Statement Summary

This Proxy Statement relates to the 2023 Annual Meeting of the shareholders of ESCO Technologies Inc., sometimes referred to herein as the Company, we, our or us. Our stock is listed on the New York Stock Exchange (NYSE), where our ticker symbol is “ESE”.

This Proxy Statement is being furnished by ESCO Technologies Inc. (the “Company”)provided pursuant to the rules of the Securities and Exchange Commission (SEC) in connection with theour Management’s solicitation of proxiesvotes for the Company’s 2020 Annual Meeting of Shareholders (the “Meeting”). The Meeting will be held onFriday, January 31, 2020 at 1500 Fifth Avenue South, Naples, Florida 34102, beginning at 9:00 a.m. Eastern Time,for the purposes set forth in the Notice of Annual Meeting above.Meeting.

A Notice ofThis Summary highlights certain information relating to the Meeting and of the availabilityitems to be voted on at the Meeting. For additional information, including important business, compensation and corporate governance matters, please refer to the following sections of this Proxy Statement and related materials was sentto our 2022 Annual Report on or about December 11, 2019Form 10-K. Unless otherwise noted, all references to all persons who held shares2022 in this Proxy Statement refer to our fiscal year ended September 30, 2022.

MEETING INFORMATION

How to Vote:

Via the Internet	By Telephone	By Mail	At the Meeting
www.investorvote.com/ESE	1-800-652-VOTE (8563) in the U.S. or Canada	Follow the instructions on the proxy card	Attend the Meeting in person  and vote by ballot

PROPOSALS AND BOARD RECOMMENDATIONS

Management is not aware of any other matters that will be presented at the Company’s common stock (“shares”) as of the close of business on December 2, 2019, the record dateMeeting. However, if any other proposal is properly presented for determining the persons entitled toa vote at the Meeting. AsMeeting, other than the election of directors and the other proposals described in this Proxy Statement, the proxy holders will vote on it in their own discretion.

NOMINEES FOR DIRECTOR

The following table provides summary information about our director nominees:

DIRECTOR DIVERSITY AND TENURE

Diversity is one of the record date, there were 25,981,313 shares outstandingfactors that our Governance Committee considers in identifying the pool of director search candidates. The Board appreciates the benefits diversity brings and entitledstrives to assemble a Board with not only a variety of business and professional backgrounds, but also diversity in areas such as race, ethnicity and gender.

COMPANY OVERVIEW AND BUSINESS HIGHLIGHTS

We are:

In fiscal 2022 we achieved record-breaking financial results despite the overall challenging economic environment. Our broad order strength drove organic growth across our three business segments. Our teams worked diligently throughout the year to offset inflation, supply chain issues, and labor shortages to deliver meaningfully profitable growth. With a solid balance sheet and substantial liquidity, we continue to be votedwell-positioned to fund investments to drive growth and shareholder value creation.

The following are only selected measures of Company performance. For complete financial information, please see the audited financial statements included in our 2022 Annual Report to Shareholders.

GOVERNANCE HIGHLIGHTS

All directors other than the CEO are independent

Competitive share ownership guidelines for directors and executive officers

All committee chairs are independent

Executive compensation driven by pay for performance

Each director attended at least 75% of Board and committee meetings

Annual shareholder vote on executive compensation

Independent directors hold executive sessions during each Board meeting

Executive officers and directors may not hedge or pledge company shares

Board conducts self-assessments annually

Independent directors review CEO performance annually

The full Board exercises oversight responsibility for material risks, and delegates oversight of other risks to the appropriate committees

Average tenure of independent directors is 9 years

Three of our eight directors are diverse in gender and/or ethnicity

Median age of independent directors is 63 years

Robust clawback policy for executive compensation plans

EXECUTIVE COMPENSATION HIGHLIGHTS

Our compensation objective is to develop and maintain an industry-competitive compensation program that attracts, retains, motivates and rewards our executive officers and other senior officers and key executives. The compensation program is designed to emphasize performance-based compensation in alignment with our business strategy.

Our compensation programs are designed to maximize shareholder value by allocating a significant portion of executive compensation to performance-based pay that is dependent on the achievement of our performance goals. Our annual cash incentive program and equity-based Performance Share Unit awards (PSUs) utilize a variety of key strategic and financial performance metrics and are designed to reward positive financial performance and limit unnecessary risk taking. Stock ownership guidelines align the interests of executives and shareholders by ensuring that executives bear the economic risk of share ownership.

For 2022, our Human Resources and Compensation Committee continued the use of historic performance metrics, “Adjusted EPS” and “Cash Flow,” to determine cash incentive plan compensation earned during fiscal 2022 and thereby incent the participants and align cash incentive compensation with business objectives. These metrics are non-GAAP measures; for a detailed description and a reconciliation to the nearest GAAP measures, see 2022 Cash Incentive Metrics in the Compensation Discussion and Analysis section.

Below are the 2021 and 2022 performance results of these metrics:

In 2022, we added PSUs to our long-term equity incentive (LTI) program in addition to the Restricted Share Units (RSUs) which were added to the program in 2021. If earned by achievement of the performance targets, PSUs are distributed in shares after a three-year performance period.

The following tables summarize the 2022 pay mix for the CEO and the other named executive officers, with 77% of the CEO’s target direct compensation at risk and 59% of the average of the other named executive officers’ target direct compensation at risk. Target direct compensation is defined as the sum of the executive officer’s base salary, annual cash incentive award, and annual long term incentive awards, in each case calculated at the Meeting.target level approved by the Committee.

This proxy solicitation is being made by the Board of Directors of the Company by mail and via the Internet. Proxies may also be solicited by telephone, e-mail or fax by directors, officers or regular employees of the Company. The expenses of this solicitation will be paid by the Company. 

Voting

Whether or not you expect to be present in person at the Meeting, please vote in advance using one of the voting methods described in the “ImportantImportant Notice Regarding the Availability of Proxy Materials”Materials sent to the shareholders on or about December 11, 2019,14, 2022, which contained instructions on how to access the proxy materials and vote electronically via the Internet, by telephone, by mail, or in person. That Notice also contained instructions on how to request a paper or e-mail copy of the proxy materials, including the Company’s 20192022 Annual Report to Shareholders, this Proxy Statement, and a proxy card. The 20192022 Annual Report to Shareholders and this Proxy Statement are also available for review on the Company’s website,www.escotechnologies.com.

In voting, you have several choices:

You will have the right to revoke your proxy at any time before it is voted by giving written notice of revocation to the Secretary of the Company, or by duly executing and delivering a proxy bearing a later date, or by attending the Meeting and casting a contrary vote in person.

* * * * *

ITEMSHOW TO BE VOTED ON AT THE MEETINGVOTE

PROPOSAL 1: ELECTION OF DIRECTORS

The Board of Directors recommends a vote FOR the election of
Patrick M. Dewar, Vinod M. Khilnani and Robert J. Phillippy as directors of the Company.

The Company's Bylaws provide that the number of directors shall not be less than three nor greater than ten, with the exact number to be determined from time to time by majority vote of the Board of Directors. In accordance with this provision, the Board has fixed the authorized number of directors at nine.

The Board is divided into three classes, with the terms of office of each class ending in successive years. The terms of directors Patrick M. Dewar, Vinod M. Khilnani and Robert J. Phillippy will expire at the Meeting, and each has been nominated to serve for three-year terms expiring at the 2023 Annual Meeting.

If elected, each of the nominees would serve until the expiration of his term and until his successor has been elected and qualified. Proxies cannot be voted for more than three nominees. Should any one or more of the nominees become unable or unwilling to serve (which is not expected), the proxies unless marked to the contrary will be voted for such other person or persons as the Board may recommend.

Certain information with respect to these nominees and the other directors whose terms of office will continue after the Meeting is set forth below, including each director’s business experience, directorships at other public companies during at least the past five years, and the specific experience, qualifications, attributes and skills which, among other reasons, have led the Board to conclude that such person is qualified to serve as a director.

Further information about the Board of Directors and its committees is set forth in the section captioned “Corporate Governance Information” beginning on page 10.

Nominees for Terms Ending in 2023

Patrick M. DewarVia the Internet	Age 59; Director since 2017By Telephone	By Mail	At the Meeting
www.investorvote.com/ESE	1-800-652-VOTE (8563)  in the U.S. or Canada	Follow the instructions on  the proxy card	Attend the Meeting in person  and vote by ballot

Mr. Dewar’s extensive strategic and operational experience in the aerospace and defense markets makes him well-qualified to assist in guiding Company strategy at the highest levels.

Principal Occupation and Business Experience: Since August 2016, Mr. Dewar has been the Chief Executive of The Trenton Group, LLC, an investment and strategy consulting firm focused on security, aerospace and defense technology companies. From 2013 until August 2016 he was Executive Vice President of Lockheed Martin International and Chairman of Lockheed Martin Global, Inc., and from 2010 to 2013 he was Senior Vice President, Strategy and Business Development for Lockheed Martin Corporation. Prior to that he served in various capacities with Lockheed Martin and GE Aerospace.

Public Company Directorships: In addition to serving on the Company’s Board of Directors. Mr. Dewar is a director (since February 2018) of Butler America Aerospace, LLC, a subsidiary of HCL Technologies Ltd. which provides a wide range of engineering, design, IT and support services primarily to aerospace and defense markets in the United States.

Other Experience and Education: Mr. Dewar holds a Master of Science degree in Electrical Engineering from Drexel University as well as a Bachelor of Science degree in Engineering from Swarthmore College. He is a member of the Council on Foreign Relations and serves as a senior adviser to numerous investment firms on aerospace and defense matters.

As a former public company executive, Mr. Khilnani brings to the Board of Directors a wealth of management experience and business knowledge regarding operational, financial and corporate governance issues, as well as extensive international experience with global operations.

Principal Occupation and Business Experience: Mr. Khilnani is the retired Executive Chairman of the Board of Directors of CTS Corporation, Elkhart, Indiana, which designs, manufacturers, and sells electronic components and sensors primarily to original equipment manufacturers worldwide. He joined CTS in May 2001 as Senior Vice President and Chief Financial Officer; in July 2007, he became President and Chief Executive Officer; in 2009 he was also elected as Chairman of the Board; and from January 2013 until his retirement in May 2013 he served as Executive Chairman. Mr. Khilnani has over 35 years of experience in the electronics, aerospace and commercial manufacturing industries, including extensive experience in mergers and acquisitions and international business development in Asia and Europe as well as North America.

Public Company Directorships: In addition to serving on the Company’s Board of Directors, Mr. Khilnani is a director (since 2009) of Materion Corporation, a manufacturer of advanced materials, performance alloys and composites, and precision coatings, where he serves as Non-Executive Chairman of the Board (since January 2018, prior to which he was Lead Director) and Chair of both the Executive Committee and the Governance and Organization Committee as well as a member of the Compensation Committee; a director (since April 2013) of 1^st Source Corporation, the parent company of 1st Source Bank, where he serves as Chairman of the Audit Committee and a member of the Executive Committee; and a director (since October 2014) of Gibraltar Industries, Inc., a manufacturer and distributor of products for the building markets, where he serves as Chairman of the Nominating and Corporate Governance Committee and a member of the Compensation Committee.

Other Experience and Education: Mr. Khilnani holds a Master of Business Administration degree from the University of New York at Albany, and a Bachelor of Arts degree in Business Administration from Delhi University.

Along with his experience as chief executive officer of a publicly held technology company, Mr. Phillippy brings to the Board of Directors extensive experience in mergers and acquisitions as well as in new product innovation and international business development.

Principal Occupation and Business Experience: Mr. Phillippy is an independent consultant, advising technology companies on a range of strategic, operational and organizational issues. From 2007 until April 2016 he was the President, Chief Executive Officer and a director of Newport Corporation, which develops, manufactures and supplies lasers, optics and photonics technologies, products and systems for scientific research, microelectronics, defense and security, life and health sciences and industrial markets worldwide. Mr. Phillippy joined Newport in 1996 and served in various executive management positions prior to his appointment as Chief Executive Officer in 2007. In April 2016 Newport was acquired by MKS Instruments, a publicly held provider of instruments, components, subsystems, and process control solutions for advanced manufacturing applications, and from July 2016 to May 2018 Mr. Phillippy served on the board of directors of MKS Instruments. From April 2016 to September 2016 he also served as Executive Advisor to MKS Instruments.

Public Company Directorships: In addition to his current service on the Company’s Board of Directors, Mr. Phillippy is a director (since May 2018) of Materion Corporation, a manufacturer of advanced materials, performance alloys and composites, and precision coatings, where he serves as a member of both the Audit Committee and the Governance and Organization Committee, and a director (since November 2018) of Kimball Electronics, Inc., a contract manufacturer of durable electronics and other products for a variety of industries globally, where he serves as a member of the Audit Committee. He was a director of MKS Instruments from July 2016 until May 2018 and a director of its predecessor Newport Corporation from 2007 until April 2016.

Other Experience and Education: Mr. Phillippy holds a Master of Business Administration degree from Northwestern University’s Kellogg School of Management, and a Bachelor of Science degree in Electrical Engineering from the University of Texas at Austin. He has over 30 years of experience in technology-related industries, including various sales and marketing management positions at Square D Company, an electrical equipment manufacturer, from 1984 to 1996.

Directors Continuing in Office

Mr. Muenster’s current position as Chief Financial Officer as well as his other financial and operational responsibilities during his long period of service with the Company make him uniquely qualified to provide the Board of Directors with valuable insights into the Company’s financial position and business opportunities.

Principal Occupation and Business Experience: Mr. Muenster has been the Chief Financial Officer of the Company since 2002. He has been the Executive Vice President of the Company since 2008, and was Senior Vice President from 2005 to 2008. Over the past 20 years, Mr. Muenster has served in a number of senior financial management positions with the Company with increasing responsibilities. Prior to joining the Company, Mr. Muenster was employed by one of the world’s largest international certified public accounting firms, KPMG LLP. In this role, Mr. Muenster served as Client Manager, auditing and providing financial, accounting and Securities and Exchange Commission compliance services to several of St. Louis’ largest publicly-traded global manufacturing companies, including Emerson Electric Co.

Public Company Directorships: Mr. Muenster currently serves on the Company’s Board of Directors.

Other Experience and Education: Mr. Muenster received a Bachelor of Science degree in Accounting from St. Louis University, and has been a licensed CPA.

Mr. Olivier has broad utilities industry experience gained over a 30-year career in all aspects of strategy and operations. These include conventional and nuclear generation, renewable energy development (hydro, wind and solar), electric and gas transmission, distribution and development, and Smart Grid strategy and design. This experience, including his extensive experience in senior leadership and management roles, makes him well qualified to serve on the Board of Directors and to assist in guiding strategy at the highest levels.

Principal Occupation and Business Experience: Mr. Olivier has been theExecutive Vice President of Enterprise Energy Strategy and Business Development of Eversource Energy (formerlyNortheast Utilities), headquartered in Boston, Massachusetts, since August 2014, and served as its Executive Vice President and Chief Operating Officer from 2007 to 2014. Eversource Energy is a public utility holding company engaged in the generation, transmission and distribution of electricity, and the distribution of natural gas, to customers in Connecticut, Massachusetts and New Hampshire.

Public Company Directorships: Mr. Olivier currently serves on the Company’s Board of Directors.

Other Experience and Education: Mr. Olivier has a Master of Business Administration degree from Northeastern University. He also served in the United States Navy submarine service. He currently serves as a director of Essex Financial Services, Essex, Connecticut.

Mr. Richey’s current position as Chief Executive Officer as well as his previous positions of ever-increasing responsibilities with the Company during his many years of service make him uniquely qualified to provide the Board of Directors with valuable insights and perspectives concerning all areas of the Company’s business.

Principal Occupation and Business Experience: Mr. Richey has been the Chairman and Chief Executive Officer of the Company since 2003 and its President since 2006. He joined the Company in 1990 and previously served in a number of positions including Vice President of Sales and Marketing for one of the Company’s former divisions; Vice President of Administration; Vice President responsible for the Company’s Communications and Test segments; and President and Chief Operating Officer.

Public Company Directorships: In addition to serving on the Company’s Board of Directors, Mr. Richey is a director of Nordson Corporation, a leader in precision dispensing equipment for applying industrial liquid and powder coatings, adhesives and sealants to numerous consumer and industrial products during manufacturing operations, where he serves as a member of the Human Resources and Compensation Committee and as Chairman of the Nominating and Corporate Governance Committee.

Other Experience and Education: Prior to joining the Company, Mr. Richey was employed by Emerson Electric Co., an international technology and engineering provider of process management, network power, industrial automation, climate technologies, and commercial and residential solutions, in a variety of roles in the Electronics and Space Division. He previously served in the United States Army as a Military Intelligence Officer. Mr. Richey has a Bachelor of Arts degree from Western Kentucky University and a Master of Business Administration degree from Washington University in St. Louis, Missouri.

Mr. Solley’s prior experience in acquisitions, international executive management, strategic planning and in sales and marketing with Emerson Electric and Fisher Controls, both large, complex, multinational corporations, as well as his engineering and domestic and foreign manufacturing experience, enable him to provide valuable insight to Board deliberations and valuable guidance to the Company.

Principal Occupation and Business Experience: Mr. Solley retired in 2002 as an Executive Vice President of the Process Management Business Group of Emerson Electric Co., an international technology and engineering provider of process management, industrial automation, climate technologies, and commercial and residential solutions. He was responsible for certain product line acquisitions and their worldwide integration into the Process Management Group, and for development of new international manufacturing facilities for the Group. Mr. Solley was previously Chairman, President and Chief Executive Officer of Fisher Controls International Inc., prior to which he held a number of other positions with Fisher Controls including Vice President Strategic Planning, Vice President Marketing and Sales, and Group Vice President. Prior to his positions at Emerson Electric and Fisher Controls, he held a number of engineering and manufacturing positions within Monsanto Agricultural Chemical Company.

Public Company Directorships: Mr. Solley currently serves on the Company’s Board of Directors.

Other Experience and Education: Mr. Solley serves on the Board of Directors of Bourns Inc., a manufacturer and supplier of sophisticated electronic components, where he serves as a member of the Audit and Compensation Committees. He received a Bachelor of Science degree in Chemical Engineering from Louisiana Tech University and engaged in post graduate studies at Loyola University in New Orleans and the Institut Européen d'Administration des Affaires (INSEAD) in Fontainebleau, France. He has also served as President and Chairman of the Valve Manufacturers Association.

Mr. Stolze’s experience in the accounting profession as well as his experience in corporate finance and treasury matters and domestic and foreign manufacturing enables Mr. Stolze to provide valuable advice and direction. As Chair of the Audit and Finance Committee of the Company’s Board of Directors, Mr. Stolze adds significant value to the Company’s goals of maintaining a strong balance sheet and fulfilling its financial reporting obligations, accurately and transparently.

Principal Occupation and Business Experience: Mr. Stolze has served as the Chief Financial Officer of two public companies: he was Vice President and Chief Financial Officer of Stereotaxis, Inc., a manufacturer of medical instruments, from 2004 until his retirement in 2009, and the Executive Vice President and Chief Financial Officer of MEMC Electronic Materials Inc. (now SunEdison Inc.) from 1995 to 2003. Prior thereto he served as an Audit Partner for KPMG LLP.

Public Company Directorships: Mr. Stolze currently serves on the Company’s Board of Directors.

Other Experience and Education: Mr. Stolze is a member of the Board of Directors and Chairman of the Audit Committee of ISTO Technologies, Inc., an orthobiologics company; and a member of the Board of Trustees of Maryville University, St. Louis, Missouri as well as that Board’s Enrollment and Student Life Committee. Mr. Stolze received a Bachelor of Science degree in Mechanical Engineering from the University of Notre Dame and a Master of Business Administration degree from the University of Michigan. He also holds a Certified Public Accountant (CPA) license from the State of Missouri, and qualifies as an audit committee financial expert under SEC regulations.

Ms. Valdez’s extensive strategic and operational experience in the defense markets as well as her management and financial expertise allow her to assist the Board in guiding the Company’s strategy at the highest level.

Principal Occupation and Business Experience: Ms. Valdez retired in April 2018 after 32 years of civilian service with the Department of the Navy and the Department of Homeland Security. Prior to her retirement, she served as the Deputy Assistant Secretary of the Navy within the Office of the Assistant Secretary of the Navy (ASN) for Research, Development and Acquisition. In this capacity, she was responsible for executive oversight of all naval shipbuilding programs, major ship conversions, and the maintenance, modernization and disposal of in-service ships. She previously served as the Executive Director for the Program Executive Office for submarines, responsible for civilian management and the design, acquisition and construction for submarine platform and undersea systems; as the Director of the Investment and Development division within the Office of ASN for Financial Management and Comptroller; as the Director for Naval and Commercial Construction in the Office of the ASN for Ship Programs; and in various other civilian positions within the Navy Department. She has also served as the Budget Director for the U.S. Immigration and Customs Enforcement within the Department of Homeland Security

Public Company Directorships: Ms. Valdez currently serves on the Company’s Board of Directors.

Other Experience and Education: Ms. Valdez holds a Master of Science degree in Management from Florida Institute of Technology as well as a Bachelor of Science degree in Mechanical Engineering from the University of New Mexico. She has received the Department of the Navy’s Distinguished, Superior and Meritorious Civilian Service Awards, and in 2014 she was awarded the Pioneer award from Great Minds in STEM. She is also the ship sponsor of the Virginia Class submarine Vermont (SSN 792), which she christened in October 2018.

PROPOSAL 2: RATIFICATION OF APPOINTMENT OF

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Board of Directors recommends a vote FOR ratification of the appointment of KPMG LLP
as the Company’s independent registered public accounting firm for its 2020 fiscal year.

The Audit and Finance Committee of the Board of Directors has appointed KPMG LLP, an independent registered public accounting firm, as independent public accountants of the Company for the fiscal year ending September 30, 2020.

Although the appointment of KPMG LLP is not required to be submitted to a vote of the shareholders, the Board of Directors believes it is appropriate to request that the shareholders ratify the appointment. If the shareholders do not ratify this appointment, the Committee will investigate the reasons for the rejection and will reconsider the appointment.

KPMG LLP or its predecessor firms have served as the independent public accountants of the Company since its incorporation in 1990. A representative of KPMG LLP is expected to be present at the Meeting with the opportunity to make a statement and respond to appropriate questions from shareholders.

Information about the fiscal 2019 audit, the Committee’s policies relating to the approval of audit and permitted non-audit services performed by KPMG LLP, and the fees paid to KPMG LLP by the Company, are set forth under “Audit-Related Matters” beginning on page 37. The Company’s audited financial statements are included in the 2019 Annual Report to Shareholders.

PROPOSAL 3: ADVISORY VOTE ON EXECUTIVE COMPENSATION

The Board of Directors recommends a vote FOR approval of the compensation
of the Company’s executive officers as disclosed in this Proxy Statement.

Pursuant to Section 14(a) of the Securities Exchange Act of 1934, the Board of Directors is again soliciting an advisory (non-binding) shareholder vote to approve the compensation of the Company’s executive officers (also referred to herein as the “named executive officers”) as described in this Proxy Statement (commonly referred to as “Say-on-Pay”). In accordance with the results of the vote we conducted at the 2017 Annual Meeting on the frequency of Say-on-Pay votes, we plan to continue to present a Say-on-Pay vote every year. At the 2019 Annual Meeting, over 94% of the shares represented and entitled to vote on the Say-on-Pay proposal were voted in support of the Company’s executive compensation program.

The Board of Directors strongly endorses the Company’s executive compensation program and recommends that the shareholders vote in favor of the following Resolution:

“RESOLVED, that the Company’s shareholders approve, on an advisory basis, the compensation of the named executive officers as disclosed in the Company’s Proxy Statement for the 2020 Annual Meeting of Shareholders pursuant to the executive compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the Summary Compensation Table, and the other related tables and narrative disclosure.”

This vote is not intended to address any specific item of compensation, but rather the overall compensation of the named executive officers as described in this Proxy Statement. Although the vote is non-binding, the Board of Directors and its Human Resources and Compensation Committee value the opinions of the shareholders, and to the extent there is a significant vote against the above resolution the Company will consider the shareholders’ concerns and the Committee will evaluate what actions (if any) may be necessary to address those concerns.

The Company’s executive compensation program is designed to attract, motivate, and retain its executive officers, who are critical to the Company’s success. The Human Resources and Compensation Committee reviews the compensation program at least annually to ensure that it achieves the desired goals of aligning the Company’s executive compensation structure with shareholders’ interests and current market practices. Based on its latest review, the Committee did not make any substantial changes to the structure of the program for fiscal 2020.

The Committee believes that the program constitutes a balanced, competitive approach to compensation that supports its compensation objectives through performance based compensation that aligns the interests of executives with those of the Company’s shareholders. Below are some key features of the compensation program, which is described in detail in the Compensation Discussion and Analysis section below:

Shareholders are encouraged to review the section captioned “Executive Compensation Information” beginning on page 17. This section provides details about the Company’s executive compensation program as well as specific information about the compensation of the named executive officers, and includes the Compensation Discussion and Analysis, the Summary Compensation Table, and the other related tables and narrative disclosure referred to in the proposed Resolution.

OTHER MATTERS

Management is not aware of any other matters that will be presented at the Meeting. However, if any other proposal is properly presented for a vote at the Meeting, other than the election of directors and the other proposals described in this Proxy Statement, the proxy holders will vote on it in their own discretion.

REQUIRED VOTE

At the Meeting, shareholders will be entitled to cast one vote for each share held by them of record on the record date. There is no cumulative voting with respect to the election of directors. The Company has no non-voting shares.

The affirmative vote of the holders of a majority of the shares represented in person or by proxy at the Meeting and entitled to vote on the matter in question will be required to elect directors, to approve each of the individual proposals described in this Proxy Statement (other than the advisory vote on the frequency of Say-on-Pay votes, with respect to which a plurality will be considered to represent the recommendation of the shareholders), and to act on any other matters properly brought before the Meeting.

The Company’s Corporate Governance Guidelines provide that an incumbent director who fails to obtain such a majority vote must promptly offer his or her resignation to the Chairman, and the remaining directors shall meet to consider whether it is in the best interests of the Company to accept the resignation or to permit the incumbent to remain on the Board for such period of time as the Board may determine or until a successor is elected and qualified.

Shares represented by proxies which are marked “Withhold Authority” with respect“Withhold” authority to vote for the election of any one or more of the nominees for election as directors, marked “Abstain” on any one or more of the other individual proposals described in this Proxy Statement, or marked to deny discretionary authority on any other matters brought before the Meeting will be counted for the purpose of determining the number of shares represented by proxy at the Meeting; but other than with respect to the advisory vote on the frequency of Say-on-Pay votes, proxies so marked will have the same effect as if the shares represented thereby were voted against such nominee or nominees, against such proposals, or against such other matters, respectively.matters.

Under the Rules of the New York Stock Exchange,NYSE, the proposal to approve the appointment of independent auditorsregistered public accountants is considered a “discretionary” item, which means that brokerage firms may vote in their discretion on this matter on behalf of clients who have not furnished voting instructions at least 10 days before the date of the meeting.Meeting. In contrast, the election of directors and the other items on the Meeting agenda are “non-discretionary” items, which means that brokerage firms that have not received voting instructions from their clients on these proposals may not vote on them. These so-called “broker non-votes” will, if the underlying shares are otherwise represented at the Meeting, be considered to be present for purposes of determining a quorum, but will be treated as not entitled to vote on such matternon-discretionary or matters; they will therefore not be considered in determining the number of votes necessary for approval and will have no effect on the outcome of the votevotes for directors or the other matters to be considered at the Meeting.

If your shares are held by a broker, it is important that you provide voting instructions to your broker so that your votes arewill be counted.

Proposal 1: Election of Directors

CORPORATE GOVERNANCE INFORMATION

BOARD OF DIRECTORSThe Board of Directors recommends a vote FOR all nominees.

The Board of Directors currently consists of nine directors,is divided into three classes, as nearly equalwith the terms of office of each class ending in size as practicable, with one class elected each year. Information about eachsuccessive years. The terms of the current directors is provided under “Proposal 1: Election of Directors” beginning on page 2.

Two of the directors, Victor L. Richey and Gary E. Muenster, are members of the Company’s management. The seven non-management directors are Patrick M. Dewar, Vinod M. Khilnani Leon J. Olivier,and Robert J. Phillippy will expire at the Meeting, and the Board has nominated each of them to serve for an additional three-year term expiring at the 2026 Annual Meeting.

If elected, the nominees would serve until the expiration of their terms and until their successors have been elected and qualified. Proxies cannot be voted for more than three nominees. Should any one or more of the nominees become unable or unwilling to serve (which is not expected), the proxies unless marked to the contrary will be voted for such other person or persons as the Board may recommend.

NOMINEES FOR TERMS ENDING IN 2026

»  Age: 70  »  Director since 2014  »  Board committees: Audit, Compensation (Chair)  »  Qualifies as an audit committee financial expert under SEC rules

Vinod M. Khilnani As a former public company executive, Mr. Khilnani brings to the Board of Directors a wealth of management experience and business knowledge regarding operational, financial and corporate governance issues, as well as extensive international experience with global operations. Principal Occupation and Business Experience 2013: Executive Chairman of the Board of Directors of CTS Corporation (designer, manufacturer and seller of electronic components and sensors)  2009–2013: Chairman and Chief Executive Officer of CTS  2007–2009: President and Chief Executive Officer of CTS 2001–2007: Senior VP and CFO of CTS Other Public Company Directorships Within Past Five Years 2009–present: Materion Corporation (manufacturer of highly engineered advanced materials, performance alloys and composites, and precision coatings for global markets) 2013–present: 1st Source Corporation (bank holding company)  2014–2021: Gibraltar Industries (manufacturer and distributor of products for the building markets) Other Experience and Education M.B.A. from the University of New York at Albany; B.A. in Business Administration from Delhi University

»  Age: 62  »  Director since 2014  »  Board Committees: Audit (Chair), Governance  »  Qualifies as an audit committee financial expert under SEC rules

Robert J. Phillippy Along with his experience as chief executive officer of a publicly held technology company, Mr. Phillippy brings to the Board of Directors extensive experience in mergers and acquisitions as well as in new product innovation and international business development. Principal Occupation and Business Experience 2016–present: Executive consultant to technology companies on a range of strategic, operational and organizational issues  2007–2016: President, Chief Executive Officer and a director of Newport Corporation (developer, manufacturer and supplier of lasers, optics and photonics technologies, products and systems for scientific research, microelectronics, defense and security, life and health sciences and industrial markets worldwide)  2004–2007: President and Chief Operating Officer of Newport Corporation 1996–2004: Held various executive management positions with Newport Corporation  1984–1996: Held various sales and marketing management positions at Square D Company (now Schneider Electric) (electrical equipment manufacturer) Other Public Company Directorships Within Past Five Years 2018–present: Materion Corporation (manufacturer of highly engineered advanced materials, performance alloys and composites, and precision coatings for global markets) 2018–present: Kimball Electronics (manufacturing solutions provider of durable electronics and other products for a variety of industries globally)  2016–2018: MKS Instruments (provider of technology solutions for semiconductor manufacturing, advanced electronics and specialty industrial applications Other Experience and Education M.B.A. from Northwestern University’s Kellogg School of Management; B.S. in Electrical Engineering from the University of Texas at Austin

DIRECTORS CONTINUING IN OFFICE

BOARD OF DIRECTORS

Responsibilities 

The Company’s Board of Directors is ultimately responsible for the conduct of the business of the Company in accordance with ethical and honorable business practices and applicable laws, to justify the confidence that the shareholders have placed in the Company by their investment in its shares. Among the Board’s core responsibilities are to:

Composition

The Board is currently comprised of eight directors divided into three classes, with the terms of office of each class ending in successive years. Former non-management director Larry W. Solley James M. Stolzeretired in February 2022 and Gloria L. Valdez. Ms. ValdezHess was elected to the Board in November 2019 for a term expiring in 2022, at which time Mr. Richey agreed to shorten his term by a year and stand for election in 2021 in order to equalize the number of directors in each class as required by the Company’s Bylaws.May 2022. There have been no other changes in the composition of the Board since the beginning of fiscal 2019.2022. As previously announced, in view of Mr. Richey’s upcoming retirement as Chief Executive Officer and President on December 31, 2022, the Board has resolved to increase the size of the Board from eight to nine members effective January 1, 2023, and to elect Bryan H. Sayler, the Company’s incoming Chief Executive Officer and President, as a director to fill the position thereby created, to serve for an initial term expiring at the 2024 Annual Meeting. Following his retirement as an executive officer, Mr. Richey will continue as a director during a transition period, with the title of Executive Chairman of the Board.

Independence

Mr. Richey is the only Board member who is a member of the Company’s management. The Board of Directors has affirmatively determined that none of the other seven, non-management directors has any material relationship with the Company other than in his or her capacity as a director and shareholder, and that therefore all of suchthese directors are, and at all times during their service in fiscal 20192022 were, independent as defined under the Company’s Corporate Governance Guidelines and the listing standards of the New York Stock Exchange. See also the discussion under “Related Person Transactions and Procedures,” below.NYSE. In addition, Mr. Solley was affirmatively determined to be independent during his service prior to his retirement.

Meetings 

The Board of Directors held fivefour meetings during fiscal 2019.2022. All of the directors attended, either in person or by conference call, at least 75% of the meetings of the Board and of each of the committees on which they served which were held during their periods of service. The Company’s policy requires that all directors attend the Annual Meeting of Shareholders, except for absences due to causes beyond the reasonable control of the director. All of the directors then serving attended, either in person or by conference call, the 20192022 Annual Meeting held at the offices of the Company’s subsidiary VACCO Industries in Denton, Texas.El Monte, California.

DIVERSITY AND TENURE

Diversity is one of the factors that the Governance Committee considers in identifying the pool of director search candidates. The Board appreciates the benefits diversity brings and strives to assemble a Board with not only a variety of business and professional backgrounds, but also diversity in areas such as race, ethnicity and gender. In 2022, our Board welcomed Ms. Hess as a director and appointed her to the Governance Committee. Ms. Hess recently retired from her position as President of the Engineered Systems Segment (ESS) and Teledyne Brown Engineering of Teledyne Technologies Incorporated (NYSE:TDY), a diversified multinational company serving energy, space, maritime, and defense markets. She previously served in several positions of increasing financial, operational, and executive responsibility with Teledyne from 2000 to 2014, including as ESS’s Executive Vice President and Chief Financial Officer.

COMMITTEES

The members of the Board of Directors are appointed to various committees. The standing committees of the Board are the Executive Committee, the Audit and Finance Committee (Audit Committee), the Nominating and Corporate Governance Committee (Governance Committee), and the Human Resources and Compensation Committee (Compensation Committee). Until his retirement in February 2022, Mr. Solley was Chair of the Governance Committee and a member of the Compensation Committee.

Each Committee operates under a written charter adopted by the Board of Directors. The charters are posted on the Company’s website, www.escotechnologies.com, under the Investor Center/Committees & Charters tab, and a copy of each Committee’s charter is available in print to any shareholder who requests it.

Executive Committee

Audit Committee

The Audit Committee assists the Board in fulfilling its oversight responsibilities for the integrity of the Company’s financial statements; the Company’s compliance with legal and regulatory requirements; the qualifications, independence and performance of the Company’s independent public accounting firm (the Accounting Firm); and the performance of the Company’s internal audit function.

The Board of Directors has determined that all members of the Committee are financially literate and have accounting or related financial management expertise, as those terms are defined under the Company’s Corporate Governance Guidelines and the applicable listing standards of the NYSE, and are “audit committee financial experts” within the meaning of Item 407(d)(5)(ii) of SEC Regulation S-K.

Governance Committee

The Governance Committee assists the Board in fulfilling its Corporate Governance responsibilities.

Director Candidates and Nominations

To be considered for nomination to the Board, candidates must be persons of the highest integrity, have extensive and varied business experience and have demonstrated their ability to interact effectively with associates and peers. They preferably will also have experience and expertise in business areas related to the Company and its technologies, industries and customers. In addition, the Committee will seek out candidates with the ability to interact constructively with the existing Board membership, in order to enable the Board to act in the long-term interests of the Company’s shareholders. While the Committee has not established specific minimum qualifications for candidates, it may establish specific membership criteria as appropriate from time to time if the Board determines there is a need for specific skills and industry experience.

Although the Committee does not have a formal policy on diversity, it seeks the most qualified candidates without regard to race, color, national origin, gender, religion, disability or sexual orientation. However, the Committee appreciates the benefits that diversity, including gender diversity, brings to a board of directors, and both the Committee and the full Board are committed to requiring the inclusion of women and underrepresented minorities in the initial pool of director search candidates.

The Committee may identify new candidates for nomination based on recommendations from Company management, employees, non-management directors, shareholders and other third parties. It also has the authority to engage third party search firms to identify candidates, and it has done so from time to time. Consideration of a new candidate typically involves the Committee’s review of information pertaining to such candidate and a series of internal discussions, and may proceed to interviews with the candidate. New candidates are evaluated based on the above-described criteria in light of the specific needs of the Board and the Company at the time. Incumbent directors whose terms are set to expire are evaluated based on the above-described criteria, as well as a review of their overall past performance on the Board of Directors.

The Committee will consider director candidates recommended by shareholders, and will evaluate such individuals in the same manner as other candidates proposed to the Committee. All candidates must meet the legal, regulatory and exchange requirements applicable to members of the Board of Directors. Shareholders who wish to recommend individuals for consideration as director candidates for the 2024 Annual Meeting of Shareholders should notify the Committee no later than August 31, 2023 in order to allow time for their recommendations to be considered by the Committee. Submissions are to be addressed to the Nominating and Corporate Governance Committee, c/o David M. Schatz, Corporate Secretary, ESCO Technologies Inc., 9900A Clayton Road, St. Louis, MO 63124-1186, which submissions will then be forwarded to the Committee. The Committee is not obligated to nominate any such individual for election.

Compensation Committee

The Compensation Committee’s basic responsibility is to assure that the Company’s directors, key executives and other senior officers are compensated in a manner consistent with and in furtherance of Company strategy, competitive practices, and the requirements of the appropriate regulatory bodies.

Compensation Committee Interlocks and Insider Participation

During fiscal 2022, none of the members of the Compensation Committee (named under “Committees” above) (i) was an officer or employee of the Company; (ii) was formerly an officer of the Company; or (iii) had any other relationship requiring disclosure under any paragraph of Item 404 or under Item 407(e)(4) of SEC Regulation S-K. In addition, during fiscal 2022, none of the Company’s executive officers served as a member of the board of directors or compensation committee of any entity that had one or more executive officers serving as a member of the Company’s Board of Directors or the Compensation Committee.

CORPORATE GOVERNANCE INFORMATION

Governance Policies and Management Oversight

The Board of Directors has adopted Corporate Governance Guidelines to guide its actions, as well as a Code of Business Conduct and Ethics applicable to all of the Company’s directors, officers and employees. Additionally, the Board has adopted a Code of Ethics for Senior Financial Officers applicable to the Company’s Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer, Controller and persons performing similar duties. These documents are posted on the Company’s web site,www.escotechnologies.com, under the www.escotechnologies.comInvestor Center/ Governance Documents, tab, and a copy of any of these documents is also available in print to any shareholder who requests it.

As permitted in the Corporate Governance Guidelines, the Board has determined that Mr. Richey shouldwill continue to hold the positions of both Chief Executive Officer and Chairman of the Board of Directors. Based upon its most current review ofDirectors until his retirement as an executive officer on December 31, 2022, and that determination, the Board continuesthereafter he will continue to believe that it has served the Company well. Mr. Richey has been and continues to beserve as Executive Chairman of the Board and Chief Executive Officer.for a mutually agreed upon transition period. The Board believes that Mr. Richey ishas been a strong leader at both the Company and the Board levels, and believes that because he has had primary responsibility for managing the day-to-day operations of the Company he ishas also been well positioned to provide Board leadership that is aligned with shareholder interests and the needs of the Company. Furthermore, the Board believes that having Mr. Richey serve as both Chairman of the Board and Chief Executive Officer enableshas enabled the Company to speak with one voice, and reduceshas reduced the chance of confusion about leadership roles and responsibilities.

At the same time, the Board is alsoremains very cognizant of its oversight responsibilities, and has had in place structural safeguards that serve to preserve the Board’s independent oversight of management. The Board has only two management directors, with a significant majority of directors remaining independent. All of the directors are highly qualified and experienced. Additionally, all of the members of the Audit and Finance Committee, the Human Resources and Compensation Committee, and the Nominating and Corporate Governance Committee are independent directors.

Further, inIn view of Mr. Richey’s dual role as Chief Executive Officer and Chairman, and in accordance with the Corporate Governance Guidelines, the Board has appointed Mr. Stolze as Lead Director. The Lead Director, chairsto chair all meetings of the independent directors, which normally occur in conjunction with each Board meeting; providesto provide regular input to the Chairman regarding the content of the agendas for meetings of the Board; advisesto advise the Chairman of the quality, quantity and timeliness of the information required by the Board to effectively and responsibly perform its oversight duties; and actsto act as liaison between the Board and the Chairman on sensitive issues.

The Board believes that these safeguards have been and are effective in preserving the Board’s independent oversight of management. However, in view of Mr. Richey’s upcoming retirement as Chief Executive Officer and President, the Board has determined that although Mr. Richey and Mr. Stolze will continue to serve as Executive Chairman of the Board and Lead Director, respectively, during the transition period after Mr. Richey’s retirement, from and after the end of the transition period a new Board Chair will be elected solely from among the independent directors and the position of Lead Director will be eliminated.

The Board’s Role in Risk Oversight

The Company’s management is responsible for managing the Company’s risks on a day-to-day basis, and has adopted an ongoing enterprise risk management process that it uses to identify and assess Company risks. Management has identified risks in four general areas: Financial and Reporting; Legal and Compliance; Operational; and Strategic. Periodically, management advises the Board and the appropriate Board committee of the risks identified; management’s assessment of those risks at the business unit and corporate levels; its plans for the management of these identified risks or the mitigation of their effects; and the results of the implementation of those plans.

While the Board as a whole has responsibility for and is involved in the oversight of management’s risk management processes, plans and controls, some of the identified risks are given further review by the Board committee most closely associated with the identified risks. For example, the Audit and Finance Committee provides additional review of the risks in the areas of accounting and auditing, liquidity, credit, tax, information security and cybersecurity. Similarly, the Human Resources and Compensation Committee provides additional review of risks in the area of compensation and benefits and human resource planning. The Nominating and Corporate Governance Committee devotes additional time to the review of risks associated with corporate governance, ethics, legal and legalESG issues.

The Board’s current leadership structure combines the positions of Chairman of the Board and Chief Executive Officer but includes the additional position of Lead Director, as discussed above. This structure enablesenabling the Chief Executive Officer who has intimate knowledge of management’s day-to-day risk management processes and controls, to ensure that the directors receive the information necessary to discharge their oversight role responsibly, while ensuring that the independent directors maintain independence in their oversight role. However, after a transitional period following Mr. Richey’s retirement as Chief Executive Officer, the Board Chair will be selected solely from among the non-management directors and the position of Lead Director will be eliminated.

Cybersecurity

Global information technology security threats and targeted computer crime are increasing in frequency and sophistication. As these risks increase, we have enhanced our use of technologies and internal controls to protect our systems, networks and data. ESCO’s cybersecurity program includes employee training and testing, information security policies and procedures, third-party monitoring of our networks and systems, and maintenance of backup and other protective systems. Governmental authorities, including the United States government, have increasingly focused on cybersecurity requirements for government contractors. Our subsidiaries that serve in these capacities are increasingly focused on cybersecurity as they seek to comply with the US Department of Defense Cybersecurity Maturity Model Certification program and related governmental mandates.

Our Board’s Audit Committee annually reviews the major financial risk exposures including cybersecurity and policies or controls management has implemented to manage and mitigate risks. On a quarterly basis, the Committee reviews management’s assessment and oversight of cybersecurity and information technologies risks and any required remediation actions.

Succession Planning

The Human Resources and Compensation Committee of the Board conducts an annual review of the Company’s long-term succession plan for the CEO. Having this succession plan in place enabled the Board to name Mr. Sayler as Mr. Richey’s successor promptly after Mr. Richey notified the Board of his decision to retire. Additionally, the Board has adoptedin place an emergency succession plan for the CEO in order to minimize the uncertainty associated with an emergency succession event.

Independence and Related Person TransactionsDeterminations

All of the Company’s directors except Mr. Richey and Procedures

The(beginning January 1, 2023) Mr. Sayler are and will be independent of Company has implemented a written policy to ensure thatmanagement. Additionally, all non-management directors meetof the independence standardsmembers of the Audit Committee, the Compensation Committee and the Governance Committee are independent as defined by the New York Stock Exchange and set forth in the Company’s Corporate Governance Guidelines.

The Company has implemented a written policy not only to ensure that all non-management directors meet the independence standards defined under the Company’s Corporate Governance Guidelines and the listing standards of the NYSE but to ensure that all Company transactions in which a “Related Person” has or will have a direct or indirect interest will be at arm’s length and on terms generally available to an unaffiliated third-party under the same or similar circumstances. “Related Persons” include the Company’s directors, director nominees and executive officers, holders of 5% or more of the Company’s stock, and the immediate family members of each. The policy contains procedures requiring Related Persons to notify the Company of any such transaction and for the Nominating and Corporate Governance Committee to review the material facts of the proposed transaction and determine whether to approve or disapprove the transaction. The Committee will consider whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third-party under the same or similar circumstances. If advance Committee approval is not feasible or is not obtained, the policy requires submission of the transaction to the Committee after the fact, and the Committee is empowered to approve, ratify, amend, rescind or terminate the transaction. In such event, the Committee will also request the General Counsel to evaluate the Company’s controls and procedures to ascertain whether any changes to the policy are recommended.

The Company has developed and implemented processes and controls to obtain information about Related Person transactions for the purpose of determining, based on the facts and circumstances, whether a Related Person has a direct or indirect material interest in the transaction. Pursuant to these processes and controls, all directors and executive officers must annually complete, sign and submit a Directors’ and Officers’ Questionnaire and a Conflict of Interest Questionnaire that are designed to identify Related Person transactions and both actual and potential conflicts of interest, and are required to update their responses in the event of any changes. Additionally, the holders of 5% or more of the Company’s shares (all of whom are institutional investors), are annually requested to respond to certain questions designed to identify direct or indirect material interests by such 5% or more shareholder in any transactions with the Company.

Based on its review and processes, the Company has determined that all non-management directors are independent under the independence standards defined by the New York Stock Exchange, and that except for the matters described in the following paragraph there has been no transaction since the beginning of the Company’s last2022 fiscal year, and there is no othertransaction currently proposed, transaction, in which the Company was or is to be a participant and in which any Related Person had or will have a direct or indirect material interest.

One of the Company’s directors, Leon J. Olivier, is the Executive Vice Presidentof Enterprise Energy Strategy and Business Development of Eversource Energy, which through its operating subsidiaries is a customer of the Company’s subsidiary Doble Engineering Company and its subsidiaries (together, “Doble”). Accordingly, the Board of Directors has affirmatively considered whether this relationship might affect Mr. Olivier’s independence as a director of the Company. The Board determined that Doble sells and leases equipment and software to Eversource Energy, repairs and calibrates the equipment and maintains the software, and provides testing, training and consulting services to Eversource Energy, all in the ordinary course of their respective businesses; that the total amount of these transactions (including a small amount of component sales to other equipment manufacturers which sell to Eversource) was less than $2,094,000 during fiscal 2018 and less than $3,313,000 during fiscal 2019 (which is less than 0.4% of the Company’s 2019 revenues and less than 0.04% of Eversource Energy’s revenues for 2018, its last completed fiscal year); that Mr. Olivier was not personally involved in these transactions; and that all transactions between Doble and Eversource Energy are intended to be and have been consistent with Doble’s normal commercial terms offered to its customers. Based on its review and consideration of these facts and Mr. Olivier’s oral and written representations, the Board determined that the relationship between the Company and Eversource Energy is not material, that the relationship will not affect Mr. Olivier’s independent judgment on matters affecting the Company, and that Mr. Olivier is independent under the standards of both the New York Stock Exchange and the Company’s Corporate Governance Guidelines.

Communications with Directors

Interested parties desiring to communicate concerns regarding the Company to the Lead Director or to the non-management Directors as a group may direct correspondence to: Mr. James M. Stolze, Lead Director, ESCO Technologies Board of Directors, ESCO Technologies Inc., 9900A Clayton Road, St. Louis, MO 63124-1186. Alternatively, interested parties who wish to communicate with an individual director or any group of directors may write to such director(s) at ESCO Technologies Inc., 9900A Clayton Road, St. Louis, MO 63124-1186, Attn: Secretary. All such letters will be forwarded promptly to the relevant director(s).

COMMITTEES

The members of the Board of Directors are appointed to various committees. The standing committees of the Board are: the Executive Committee, the Audit and Finance Committee, the Nominating and Corporate Governance Committee, and the Human Resources and Compensation Committee.

Executive Committee

The Executive Committee’s function is to exercise the full authority of the Board of Directors between Board meetings, except that the Executive Committee may not take certain specified actions which the Board of Directors has reserved for action by the whole Board.

The Executive Committee met twice in fiscal 2019. Its members are Mr. Richey (Chair) and Mr. Stolze (Lead Director).

Audit and Finance Committee

The functions of the Audit and Finance Committee are generally to assist the Board of Directors in its oversight of the Company’s financial reporting process, the Company’s compliance with legal and regulatory requirements, the qualifications, independence and performance of the Company’s independent registered public accounting firm (the “Accounting Firm”), and the performance of the Company’s internal audit function. The Committee is responsible for appointing, retaining and overseeing the Accounting Firm and its performance of the annual audit; annually evaluating the qualifications, independence and prior performance of the Accounting Firm; reviewing the scope of the Accounting Firm’s work and approving its annual audit fees and any non-audit service fees; reviewing the Company’s internal controls with the Accounting Firm and the internal audit executive; reviewing with the Accounting Firm any problems it may have encountered during the annual audit; discussing Form 10-K and 10-Q reports with management and the Accounting Firm before filing; reviewing and discussing earnings press releases; discussing with management major financial risk exposures; reviewing the annual internal audit plan and associated resource allocation; and reviewing the Company's reports to shareholders with management and the Accounting Firm and receiving certain assurances from management.

The Committee is also responsible for the Audit Committee Report required to be included in this Proxy Statement pursuant to the regulations of the Securities and Exchange Commission (“SEC”). This Report is set forth under “Audit-Related Matters” beginning on page 37.

The members of the Audit and Finance Committee are Mr. Dewar, Mr. Khilnani, Mr. Phillippy and Mr. Stolze (Chair). The Board of Directors has determined that each member of the Committee is independent, is financially literate, and has accounting or related financial management expertise, as those terms are defined under the Company’s Corporate Governance Guidelines and the applicable listing standards of the New York Stock Exchange. In addition, the Board of Directors has determined that Mr. Stolze is an “audit committee financial expert” within the meaning of Item 407(d)(5)(ii) of SEC Regulation S-K. The Committee met four times in fiscal 2019.

The Committee operates under a written charter adopted by the Board of Directors. The charter is posted on the Company’s web site,www.escotechnologies.com, under the “Investor Center–Governance” tab, and a copy is available in print to any shareholder who requests it.

Nominating and Corporate Governance Committee

The functions of the Nominating and Corporate Governance Committee are generally to identify individuals qualified to become Board members and recommend them for election to the Board; to review the composition of Board committees; to develop and recommend to the Board effective corporate governance guidelines; to review the Company’s corporate governance and compliance programs; to oversee the Company’s ethics programs; to review conflicts of interest involving Related Persons, including oversight and administration of the Company’s policy on Related Person transactions; and to lead the Board in its annual review of the Board’s performance.

To be considered for nomination to the Board, candidates must be persons of the highest integrity, have extensive and varied business experience and have demonstrated their ability to interact effectively with associates and peers. They preferably will also have experience and expertise in business areas related to the Company and its technologies, industries and customers. In addition, the Committee will seek out candidates with the ability to interact constructively with the existing Board membership. These attributes will enable the Board to act in the long-term interests of the Company’s shareholders. While the Committee has not established specific minimum qualifications for candidates, it may establish specific membership criteria as appropriate from time to time if the Board determines there is a need for specific skills and industry experience.

Although the Committee does not have a formal policy on diversity, it seeks the most qualified candidates without regard to race, color, national origin, gender, religion, disability or sexual orientation. However, the Committee appreciates the benefits that diversity, including gender diversity, can bring to a board of directors.

The Committee may identify new candidates for nomination based on recommendations from Company management, employees, non-management directors, shareholders and other third parties. The Committee also has the authority to engage third party search firms to identify candidates, and it has done so from time to time. Consideration of a new candidate typically involves the Committee’s review of information pertaining to such candidate and a series of internal discussions, and may proceed to interviews with the candidate. New candidates are evaluated based on the above-described criteria in light of the specific needs of the Board and the Company at the time. Incumbent directors whose terms are set to expire are evaluated based on the above-described criteria, as well as a review of their overall past performance on the Board of Directors.

The Committee will consider director candidates recommended by shareholders, and will evaluate such individuals in the same manner as other candidates proposed to the Committee. All candidates must meet the legal, regulatory and exchange requirements applicable to members of the Board of Directors. Shareholders who wish to recommend individuals for consideration as director candidates for the 2020 Annual Meeting of Shareholders should notify the Committee no later than August 31, 2019 in order to allow time for their recommendations to be considered by the Committee. Submissions are to be addressed to the Nominating and Corporate Governance Committee, c/o Alyson S. Barclay, Corporate Secretary, ESCO Technologies Inc., 9900A Clayton Road, St. Louis, MO 63124-1186, which submissions will then be forwarded to the Committee. The Committee is not obligated to nominate any such individual for election.

The members of the Nominating and Corporate Governance Committee are Mr. Olivier, Mr. Phillippy, Mr. Solley (Chair) and Ms. Valdez. Each member has been affirmatively determined to be an independent director as defined under the Company’s Corporate Governance Guidelines and the applicable listing standards of the New York Stock Exchange. The Committee met five times in fiscal 2019.

The Committee operates under a written charter adopted by the Board of Directors. The charter is posted on the Company’s web site,www.escotechnologies.com, under the “Investor Center–Governance” tab, and a copy is available in print to any shareholder who requests it.

Human Resources and Compensation Committee

The functions of the Human Resources and Compensation Committee are generally to review and approve corporate goals and objectives relevant to compensation of the Chief Executive Officer; to evaluate the Chief Executive Officer’s performance in light of these goals and objectives; to determine the Chief Executive Officer’s compensation based upon the evaluation; to review and approve the compensation of senior officers and other key executives; to approve and evaluate incentive compensation plans, equity-based plans and other compensation plans; to review and approve benefit programs which go beyond the prerogatives of management, including implementation of new programs and material changes to existing programs; to review the performance and development of, and succession planning for, Company management; to assure that executive officers and other senior executives of the Company are compensated in a manner consistent with the strategy of the Company and competitive practice; and to oversee the Company’s Charitable Contributions Program.

The Committee is also responsible for reviewing and discussing with management the Company’s annual Compensation Discussion and Analysis, and recommending its inclusion in the Company’s annual proxy statement and the Company’s Form 10-K filed with the SEC. Its Report on these matters is set forth on page 17.

The members of the Human Resources and Compensation Committee are Mr. Khilnani (Chair), Mr. Solley and Mr. Stolze. Each member has been affirmatively determined to be an independent director as defined under the Company’s Corporate Governance Guidelines and the applicable listing standards of the New York Stock Exchange, including its enhanced independence standards for compensation committee members. The Committee met four times in fiscal 2019.

The Committee operates under a written charter adopted by the Board of Directors. The charter is posted on the Company’s web site,www.escotechnologies.com, under the “Investor Center–Governance” tab, and a copy is available in print to any shareholder who requests it.

Compensation Committee Interlocks and Insider Participation

The members of the Human Resources and Compensation Committee during fiscal 2019 were Mr. Khilnani, Mr. Solley and Mr. Stolze. During fiscal 2019, none of these individuals (i) was an officer or employee of the Company; (ii) was formerly an officer of the Company; or (iii) had any other relationship requiring disclosure under any paragraph of Item 404 or under Item 407(e)(4) of SEC Regulation S-K. In addition, during fiscal 2019 none of the executive officers served as a member of the board of directors or compensation committee of any entity that had one or more executive officers serving as a member of either the Company’s Board of Directors or its Human Resources and Compensation Committee.

DIRECTOR COMPENSATION

The responsibilities and the substantial time commitment of a director at a public company require that the Company provide reasonable compensation to incentivize the directors’ performance and ensure their willingness to continue to serve. The Company strives to engage and retain well-qualified directors with significant experience at companies of similar size and complexity. To ensure this is achieved, the Company regularly reviews the compensation provided to its directors. The Human ResourcesCompany’s non-employee directors are compensated pursuant to the Sub-Plan for Compensation of Non-Employee Directors under the 2018 Omnibus Incentive Plan (Director Compensation Plan) based upon their respective levels of Board participation and responsibilities. The Compensation Committee obtains competitive market and peer data and periodically retains a compensation consultant to evaluate the competitiveness of its director compensation. The Company’s non-employee directorsCommittee approves the directors’ compensation, but any changes are compensated pursuant toratified by the Company’s Compensation Plan for Non-Employee Directors based upon their respective levels of Board participation and responsibilities, including service on Board committees. Directors who arefull Board. As employees of the Company, doMr. Richey does not receive, and following the commencement of his term as a director Mr. Sayler will not receive, compensation for their service as directors.a director.

Compensation Components. Since the beginning of calendar year 2018 cash compensation paid to non-management directors has consisted of an annual cash retainer of $50,000 for all Board2022 and Committee member services during the year; plus additional annual cash retainers for the Lead2023 Director and the Chairs of the Audit and Finance Committee, the Nominating and Corporate Governance Committee and the Human Resources and Compensation Committee of $25,000, $7,000, $5,000 and $5,000, respectively. These annual cash retainers are paid in early January.

In addition, each non-management director receives

The annual stockequity award distributed on the first business day of January,consists of a number of sharesRSUs equal to $180,000 divided by the NYSE closing price of the common stock on the distributionaward date, rounded to the nearest whole share.share and vesting one year after the award date. The annual stock retainerequity award for 2019calendar 2022 was distributedmade on January 2, 20193, 2022 and is included in the directors’ stock compensation for fiscal 2019; basedwill vest on January 3, 2023. Based on the January 2, 20193, 2022 NYSE closing stock price of $64.81$88.66 it amounted to 2,777 shares2,030 RSUs per non-management director. On May 27, 2022 following her election as a director, Ms. Hess received a partial year award for the remainder of calendar 2022 of $135,000 divided by the $66.01 NYSE closing price on that date, or 2,045 RSUs, which will vest on May 27, 2023.

At its August 2019 meeting,During the Human Resourcesvesting period, each director’s RSU account accrues an additional number of unvested RSUs equivalent to the quarterly dividends that would have been paid on a like number of shares of common stock, divided by the NYSE closing price on the dividend date; and on the vesting date the accrued RSUs vest and are converted into a whole number of shares of common stock plus cash equal to the value of any fractional shares, based on the NYSE closing price on the vesting date.

Changes for 2023

The Compensation Committee reviewed the directors’ annual compensation planprogram in August 2022, and determined thatbased on its recommendations the directors were appropriately compensated; therefore, noBoard approved changes were madein the committee chair fees and timing of the annual payments, in order to the directors’be more consistent with prevailing director compensation for 2020.practices. Accordingly, beginning with calendar 2023:

Election to Defer Compensation. The Compensation Plan for Non-Employee

Directors permits directors tomay elect in advance to defer receipt of all of their cash compensation and/or all of their stock compensation. If deferral is elected, the deferred amounts are credited to the director’s deferred compensation account in common stock equivalents. If cash compensation is deferred, the number of common stock equivalents credited is equal to the amount deferred divided by the NYSE closing price of the common stock as of the date on which the deferral occurs (or if that is not a trading day, then the last preceding trading day). If stock compensation is deferred, the number of common stock equivalents credited is equal to the number of shares whose receipt is deferred. Common stock equivalents in the director’s deferred compensation account have no voting rights, but earn dividend equivalents on each dividend payment date equal to the dividends payable on a like number of shares of common stock; and the dividend equivalents earned are credited to the director’s deferred compensation account as additional common stock equivalents valued at the NYSE closing price on the dividend date. A director’s deferred compensation account becomes distributable when the director leaves the Board, or at such other date as may be specified by the director consistent with the terms of the Director Compensation Plan; distribution will be accelerated in certain circumstances, including a change in control of the Company. The account is distributable at the election of the director either in cash or in shares; however, any stock portion which has been deferred may only be distributed in shares. During fiscal 2019,2022, Mr. Dewar, andMs. Hess, Mr. Olivier and Ms. Valdez deferred receipt of their cash compensation and stock compensation, and Mr. Phillippy deferred receipt of only his stock compensation, as described in the footnotes to the TableFiscal 2022 Compensation table below. In addition, Mr. Phillippy’s and Mr. Stolze’s stock compensation from certain prior years continued to be deferred pursuant to a prior deferral electionelections which he subsequentlythey had terminated as to future compensation.

Director Stock Ownership Guidelines. 

Directors are subject to stock ownership guidelines. Under these guidelines, within five years after their appointment to the Board each non-management director is expected to acquire and hold shares or common stock equivalents having a total cash value equal to at least five times the annual cash retainer. All directors currently hold more than that amountexceed the ownership guidelines, except Ms. Valdez,Hess, who was elected in November 2019February 2022 and is expected to meet the guidelines within the five-year period.

Extended Compensation Plan for Certain Directors. 

Under the Company’s Directors’ Extended Compensation Plan, a plan for non-management directors who began Board service prior to April 2001, Mr. Solley and Mr. Stolze are eachis eligible to receive for life an annual benefit of $20,000 beginning after theirhis service as a director ceases. In the event of thehis subsequent death, of a retired director who is eligible under this plan, 50% of the benefit will be paid to thehis surviving spouse for life; if an eligible directorMr. Stolze dies before retirement, 50% of the benefit, determined as if the director had retired on the date of death, will be paid to thehis surviving spouse in a lump sum..sum. The plan permits an eligible directorMr. Stolze to elect to receive the actuarial equivalent of the benefit in a single lump sum after retirement; and in compliance with section 409(a) of the Internal Revenue Code, Mr. Solley and Mr. Stolze have eachhas made this election. Mr. Solley was also a participant in the Directors’ Extended Compensation Plan until his retirement in February 2022, and on April 1, 2022 he received a lump sum payment of $205,393 in satisfaction of his benefit entitlement.

Fiscal 2022 Compensation 

Fiscal 2019 Compensation.The following table sets forth the compensation of the Company’s non-management directors for fiscal 2019.2022. As an executive officer, Mr. Richey and Mr. Muenster are executive officers and did not receive any additional compensation for theirhis service as directors; theira director; his compensation is set forth in the section captioneddescribed under “Proposal 3: Advisory Vote on Executive Compensation Information” beginning on page 17.30.

Proposal 2: Extension and Amendments of the Company’s 2018 Omnibus Incentive Plan

The Board of Directors recommends a vote FOR this Proposal.

Our shareholders approved the Company’s 2018 Omnibus Incentive Plan (the “Omnibus Plan” or “Plan”) at the 2018 Annual Meeting. The Company believes that the Plan has successfully supported the Company’s efforts to attract, retain, motivate and reward employees and non-employee directors by means of appropriate incentives to achieve long-range goals. Equity-based incentives such as those awarded under the Plan also align the participants’ interests with those of the Company’s stockholders in growing the value of the Company’s equity and enhancing long-term shareholder returns.

Accordingly, for the reasons described below, the Company is seeking shareholder approval to amend the Plan and extend its term for an additional five years.

DESCRIPTION OF PROPOSED EXTENSION AND AMENDMENTS

Summary of Proposal

The Board recommends approval of the following amendments to the Plan, which are described below and specifically set forth in Appendix A:

Extension of Plan Term

As part of our continuing incentive compensation program, and upon the consideration and recommendation of the Board of Directors, the Plan was submitted to and approved by our shareholders at the 2018 Annual Meeting. The Plan is currently scheduled to expire on February 2, 2023, the day before the 2023 Annual Meeting.

Because of the success of the Plan, the Board has deemed it advisable to extend the term of the Plan, and therefore recommends that the shareholders approve an extension of the term of the Plan for another five years, until the close of the 2028 Annual Meeting of Shareholders. If the extension is not approved, the Company will be unable to issue new incentive awards under the Plan after the date of the Annual Meeting, which would be very detrimental to the Company’s compensation program.

Increase in Number of Available Plan Shares

As originally adopted, the Omnibus Plan allows the issuance of share based awards issuable as or convertible into a maximum of 977,878 shares of Company common stock. As of November 30, 2022, awards representing a total of 488,990 shares had been granted under the Omnibus Plan, leaving 428,888 shares available for future “full value” (non-option) awards during the Omnibus Plan term. The Company expects that the additional 550,000 shares being requested will be sufficient to satisfy the Company’s needs for stock-based awards for the five-year extended term of the Plan, including a reserve for contingencies. The number of shares actually required will depend in part on the Company’s stock prices at the times of the various stock-based awards.

Accordingly, in order to accommodate the equity awards currently anticipated to be granted during the proposed five-year extension of the Omnibus Plan and allow for a cushion to cover unexpected circumstances, the Board recommends that the shareholders approve increasing the total number of shares authorized under the Omnibus Plan by 550,000 shares, from 977,878 to 1,527,878, and removing the current use restriction on an additional 100,000 currently-authorized shares, as described below.

Elimination of Options-Only Use Restriction on Certain Previously-Authorized Plan Shares

The Plan currently provides that 100,000 of the currently-authorized Plan shares may be used only for stock options or other awards which require the participant to make a payment to the Company in order to receive actual shares. However, the Company has not issued any awards of these types in recent years. The Company will continue to grant “full value” awards or other types of awards as the Company and market practices determine from time to time, including those described in detail under Compensation Discussion and Analysis beginning on page 31 and Director Compensation beginning on page 18).

Eliminating the “options-only” use restriction on these 100,000 shares would allow them to be used for the types of awards the Company intends to grant and thereby reduce the number of new shares needed to be authorized.

Clarifying and Conforming Amendments

The proposal will also amend the Plan as follows:

Because awards under the Omnibus Plan are discretionary, the Company cannot predict the number of shares that would be awarded under the extended Omnibus Plan to any individual executive officer or non-employee director, to all executive officers or non-employee directors as a group, or to all employees as a group; however, awards granted under the Omnibus Plan to the Company’s directors for fiscal 2022 and to its executive officers for fiscal 2022 and certain prior years are described under Director Compensation, above, and under Compensation Discussion and Analysis and the accompanying tables, below.

SUMMARY OF THE OMNIBUS PLAN

The following summary of certain provisions of the Omnibus Plan is not complete and is qualified by reference to the text of the Omnibus Plan including the proposed amendments, which is set forth in Appendix A to this Proxy Statement.

Purpose

The purpose of the Omnibus Plan is to maintain and strengthen the Company’s ability to attract and retain executive, managerial and other salaried employees; to motivate participants to achieve long-range goals consistent with increases in shareholder value; to provide incentive compensation opportunities that are flexible and competitive with those of other similar businesses; to support the Company’s executive compensation program (discussed in the Compensation Discussion and Analysis section of this Proxy Statement); and, in the case of stock-based awards, to further align participants’ interest with those of the shareholders through compensation that is based on the value of the Company’s common stock.

Types of Awards

To provide maximum flexibility, the Omnibus Plan permits the Compensation Committee to grant a variety of awards, although the Company’s current compensation programs include only a few of the permitted types of awards. Permitted types of awards include awards granted on the basis of shares of Company common stock or the value thereof (Stock-Based Awards), which may include Stock Options (including Incentive Stock Options), stock appreciation rights linked to Stock Options (Tandem SARs), and time vested or performance vested full value awards (RSUs and PSUs respectively) as well as other restricted share awards or other stock-based awards, and which may be distributed in shares of common stock or cash according to the terms of the award. Permitted types of awards also include awards which are not based on shares of Company common stock or the value thereof and may be measured and distributed solely in cash (Cash-Based Awards), such as long-term or short-term cash incentive awards such as those under the Company’s PCP program. The Omnibus Plan also permits awards to be granted to non-employee directors subject to special limitations (Director Share Awards).

Maximum Number of Shares

The current maximum number of shares of Company common stock which may be allocated to Stock-Based Awards under the Omnibus Plan is 977,878 shares, of which 100,000 shares may currently be used under the Omnibus Plan only for Stock Options or other awards which require the participant to make a payment to the Company in order to receive actual shares. The Company’s proposal would eliminate this restriction as well as increase the total number of authorized shares, as described above.

No Reload

If any Stock-Based Award expires or is canceled on account of termination of a participant’s employment, failure to meet performance objectives or any other term of the Award, tender of the underlying shares as payment for a Stock Option, surrender of the underlying shares to pay withholding taxes, or for any other reason whatsoever, the shares related to the canceled award shall not be returned to the Omnibus Plan and may not be available for subsequent awards.

Adjustments

The number of shares allocated to the Omnibus Plan shall be appropriately adjusted to reflect any subsequent stock dividends, stock splits, reverse stock splits and similar matters affecting the overall number of the Company’s outstanding shares.

Source of Shares

Shares issued under the Omnibus Plan may be either previously unissued shares or shares held in treasury, in the Company’s discretion.

Eligibility

Participation in the Omnibus Plan is in the discretion of senior management. In fiscal 2022, approximately 150 employees received Cash-Based Awards under the Plan (such as awards under the PCP, Corporate Incentive Plan, similar subsidiary plans, and retention awards), 32 full-time employees received RSU and/or PSU awards, and four other employees received Other Stock-Based Awards for employee retention purposes. The Company’s non-employee directors are eligible to receive Director Share Awards. The Company has the discretion to determine the specific employees who may be granted awards under the Omnibus Plan and the specific amounts or types of awards which may be granted to any future recipient. Each award granted under the Omnibus Plan will be evidenced by a written award agreement or notice of award specifying the terms of the award.

Sub-Plans

For convenience in granting, administering and referring to awards with similar terms or which are made to similarly-situated recipients, the Omnibus Plan authorizes the Committee to establish subsidiary plans under the Omnibus Plan (such as the PCP cash incentive plan and the Sub-Plan for Compensation of Non-Employee Directors described elsewhere in this Proxy Statement). No subsidiary plan may grant greater rights to award recipients than those authorized by the Omnibus Plan, and all subsidiary plans in the aggregate may not exceed the share limitations and other restrictions under the Omnibus Plan.

Recent Share Price

The closing price of the shares on the NYSE on November 30, 2022 was $94.01 per share.

Stock-Based Awards

Full Value Awards

“Full Value Awards” are awards granted under the Plan where the recipient does not have to pay cash or other consideration to receive the value of the award. The Company’s RSU and PSU award programs and its now-terminated PARS program are all Full Value Award programs. These awards represent the right of the holder to receive a specified number of shares, or the value thereof, at a specified future time or times and/or if specified performance objectives and/or service contingencies are achieved. The vesting and payment dates and/or the performance objectives may be established from time to time by the Committee (for example, the criteria set forth under “Performance Criteria” below), and need not be the same for all participants.

The Plan provides that each such program will have one or more specified objectives and/or performance periods over which the objectives are targeted for achievement, and that in order to receive a distribution under a Full Value Award, a participant must be continuously employed by the Company or a subsidiary for such period after grant as the Committee may determine. However, in the event of termination of employment due to the participant’s death or disability, the Committee has the discretion to authorize a full or partial distribution; and in the event of the participant’s retirement with the Committee’s approval, any Full Value Award which has been outstanding less than 12 months shall be forfeited, any other PARS award or portion thereof which has been accelerated due to satisfaction of the performance criteria shall be distributed to the retired participant in full, and any other PARS or RSU award or portion thereof shall be distributed to the retired participant pro rata based on the number of months elapsed prior to retirement compared to the total number of months in the Award term. Where a participant retires prior to the end of a PSU award’s performance period, the award will continue to be subject to performance criteria and if earned, the pro rata portion will be distributed at the end of the award’s performance period based on the award’s actual final scoring. For details on the terms of recently-issued RSU and PSU Awards, see Compensation Discussion and Analysis and the accompanying tables, below.

Stock Options and Tandem SARs.

The Committee has not recently granted Stock Options or Tandem SARs and none are currently outstanding, but it has decided to continue their authorization under the Omnibus Plan in order to provide the Committee with maximum flexibility should the need arise. Stock Options and Tandem SARs may be granted only to full-time or part-time employees of the Company or its subsidiaries, provided that Incentive Stock Options may not be granted to employees of certain non-corporate or foreign subsidiaries. Subject to the express provisions of the Omnibus Plan, the Committee has full authority to determine the terms and provisions of each Stock Option and Tandem SAR, which need not be uniform for all optionees. The exercise (purchase) price under each Stock Option may not be less than 100% of the fair market value of the shares at the effective date of the grant (which may not be prior to the approval date). For this purpose, fair market value will generally be the closing price of the shares on the NYSE on the effective date; provided, that the Committee may adopt any other criterion for the determination of fair market value as it may determine to be appropriate. The Committee may not, without Shareholder approval, reprice outstanding Stock Options or Tandem SARs by lowering their exercise price or by exchanging them for new awards with a lower exercise price.

The exercise price must be paid in full upon the exercise of the Stock Option, either (i) in cash, or (ii) by the tender to the Company (either actually or by attestation) of shares owned by the optionee for at least six (6) months and having a fair market value equal to the cash exercise price of the Stock Option being exercised, with the fair market value of such shares to be determined in such appropriate manner as may be provided for by the Committee or the Company as may be required in order to comply with, or to conform to the requirements of, any laws or regulations applicable to the Company and the Stock Options, or (iii) except as limited or prohibited by the Committee or the Company, by effecting a “cashless exercise” of the Stock Option by means of a “same day sale” in which the option shares are sold through a broker selected by the optionee and a portion of the proceeds equal to the exercise price plus any taxes due is paid to the Company, or (iv) by any combination of the foregoing payment methods, or (v) by such other method or methods as may be determined by the Committee or the Company; provided, that no shares may be tendered in exercise of an Incentive Stock Option if such shares were acquired by the optionee through the exercise of an Incentive Stock Option unless (A) such shares have been held by the optionee for at least one year and (B) the prior Incentive Stock Option through which the tendered shares were acquired was granted at least two years prior to the tender.

The term of a Stock Option may not be more than five years from its effective date. Subject to the terms of the Omnibus Plan and the limitations set out below, Stock Options will be exercisable on such conditions and at such time or times as the Committee in each instance approves, which need not be uniform for all options.

The maximum aggregate fair market value (determined at the time of grant) of the shares with respect to which Incentive Stock Options are exercisable for the first time by any optionee during any calendar year shall not exceed $100,000. The aggregate number of shares of Common Stock with respect to which Stock Options and Tandem SARs may be granted to any individual during any calendar year may not exceed 150,000.

At the time a Stock Option is granted, the Committee, in its discretion, may grant to an optionee a Tandem SAR with respect to all or any part of the number of shares covered by the Stock Option. An optionee who also holds a Tandem SAR may exercise the Tandem SAR in lieu of exercising the Stock Option by delivering to the Company a notice specifying the number of shares as to which the optionee wishes to exercise the Tandem SAR and stating what portion of the proceeds the optionee would like to receive in cash and what portion in shares. Upon exercise of the Tandem SAR, the optionee will be paid an amount in cash and/or shares (as determined by the Committee taking into account the optionee’s request), an amount equal to the excess of the fair market value of a share on the date of exercise over the per-share exercise price for the Stock Option in respect of which the Tandem SAR was granted, multiplied by the number of shares as to which the Tandem SAR is exercised. Each Tandem SAR will be exercisable for such period as the Committee determines, which time period may not exceed the time period during which the corresponding Stock Option may be exercised.

The exercise of a Tandem SAR will reduce the related Stock Option by the number of shares as to which the Tandem SAR is exercised; and the exercise of a Stock Option will reduce any related Tandem SAR by the number of shares as to which the Stock Option is exercised.

Stock Options and Tandem SARs will not generally be transferable except by will or the laws of descent and distribution, and may be exercised during the lifetime of the optionee only by the optionee. However, the Committee may permit a Stock Option which is not an Incentive Stock Option to be transferred to a trust for the benefit of the option holder’s immediate family member(s), or to a partnership, limited liability company or similar entity in which such immediate family member(s) comprise the majority partners or equity holders. For purposes of this provision, an option holder’s immediate family means the option holder’s spouse, children and grandchildren.

A Stock Option or Tandem SAR must be exercised prior to the termination of employment, except that: (i) if the optionee’s employment is terminated with the consent and approval of the Company, the Committee or its designee may permit the Stock Option or Tandem SAR to be exercised within 90 days after such termination, or in the case of options other than Incentive Stock Options, within one year after termination on account of retirement on or after age 55; or (ii) if the optionee’s employment terminates on account of disability the Stock Option or Tandem SAR may be exercised, to the extent it was exercisable at the date of termination, within one year after the date of termination; or (iii) in the event of the optionee’s death the Stock Option or Tandem SAR may be exercised, to the extent it was exercisable at the date of death, within one year after the date of death; but in no event may a Stock Option or Tandem SAR be exercised after the expiration of its term as specified in the Stock Option agreement or notice of award.

Other Stock-Based Awards

The Committee may from time to time, in its discretion, grant Stock-Based Awards other than RSUs, PSUs, PARS awards, Stock Options or Tandem SARs, including, without limitation, awards pursuant to which shares may be acquired in the future, such as awards denominated in shares, stock units, securities convertible into shares, and phantom securities. Such awards may be subject to either performance-based or non-performance-based vesting criteria, such as continued employment for a specified period either before or after the shares are earned, and may be subject to restrictive legends, stop transfer instructions or other restrictions as the Committee may deem appropriate. The Committee shall determine, and provide in the applicable agreement for, the terms and conditions of such other Stock-Based Awards. No such other Stock-Based Awards are currently outstanding.

No Voting or Other Shareholder Rights Until Shares Actually Issued

Under the current Plan, the holder of a Stock-Based Award has no voting or other rights of a shareholder with respect to the shares underlying the award, until the shares are actually issued to the holder. However, one of the proposed amendments would permit the Committee to provide for the accrual of dividends or dividend equivalents on the underlying shares.

Special Provisions for Stock-Based Awards to Named Executive Officers

The Omnibus Plan requires that each Stock-Based Award granted to a person who is a “named executive officer” of the Company as defined in Item 402(a)(3) of SEC Regulation S-K (NEO) must provide that, in addition to any other applicable restrictions on transfer, the NEO may not dispose of any portion of the beneficial interest in Common Stock received (net of any withheld shares) on account of the Award: (i) within 12 months after the Common Stock is delivered to the NEO, or such earlier time as the person ceases to be an NEO; or (ii) if after such disposition the NEO would fail to satisfy the NEO’s minimum ownership requirement for Company Common Stock established by the Company.

Limited Authority to Delegate

The Committee may delegate to the Chief Executive Officer the authority to grant Stock Options of up to 10,000 shares of Common Stock per person (and 50,000 per year in the aggregate) to selected employees who are not either reporting persons under Section 16 of the Exchange Act or “covered employees” as defined in section 162(m) of the Internal Revenue Code (Code). The Committee may delegate to the Executive Committee the authority to grant Stock-Based Awards other than Stock Options of up to 10,000 shares of Common Stock per person (and 50,000 per year in the aggregate) to selected employees who are not either reporting persons under Section 16 of the Exchange Act or covered employees.

Cash-Based Awards

The Omnibus Plan also permits the Committee to grant Cash-Based Awards whose value does not depend on the price of the Company’s stock, with the terms of each such award to be specified in the applicable award agreement or notice of award. A major part of the Company’s cash incentive program includes annual cash incentive awards, which provide for the payment of cash if certain performance targets are met over a specified performance period; each performance target and period must be set forth in the relative agreement, which need not be uniform for all participants. The Company has no current plans to change this program. For details of the Company’s cash incentive program and the recent awards thereunder, see Compensation Discussion and Analysis, below.

Although the Omnibus Plan does not limit the amount of Cash-Based Awards which may be paid in cash, any Cash-Based Awards which the Committee may permit to be paid in shares will be subject to the aggregate share limitation specified in the Omnibus Plan.

Director Share Awards

Director Share Awards are a class of equity awards which may be issued only to non-employee directors, consisting of either shares of Company stock or cash awards which the director recipients have elected to defer and receive in Company stock at the end of the deferral period.

In addition to the general limitations in the Omnibus Plan,

Performance Criteria

The Committee may determine that an award under the Omnibus Plan is to be “performance based,” which means that the timing or amount of shares or cash under the award is based in whole or in part on the satisfaction of one or more performance criteria specified in the award. These performance criteria may include, but need not be limited to, objective tests based on one or more of the following criteria set forth in the Omnibus Plan: earnings per share; adjusted earnings per share; sales; earnings; cash flow; profitability; customer satisfaction; investor relations; revenues; financial return ratios; market performance; shareholder return and/ or value; operating profits (including earnings before income taxes, depreciation and amortization); net profits; earnings per share growth; profit returns and margins; stock price; working capital; business trends; production cost; project milestones; plant and equipment performance; safety performance; environmental performance; gross margin; operating margin; net margin; expense margins; EBIT margin; EBIT growth; EBITDA margin; EBITDA growth; adjusted EBITDA; net operating profit after tax margin; gross operating profit after tax; non-interest-bearing current liabilities; net assets; working capital; asset turnover; working capital turnover; accounts receivable turnover; accounts payable turnover; inventory turnover; inventory days outstanding; accounts receivable days outstanding; accounts payable days outstanding; debt to equity; debt to capital; current ratio; return on equity; return on assets; return on net assets; return on invested capital; return on gross assets; return on tangible assets; cash flow return on investment; cash value added; price to earnings ratio; market to book ratio; market to capital ratio; cost of capital; cost of debt; cost of equity; market risk premium; stock price appreciation with or without divisions; total shareholder return; economic value added; economic profit;

sales growth percentage; EPS growth percentage; cash flow growth year over year; return on total capital, or any combination of the foregoing. Performance criteria may be measured solely on a corporate, subsidiary, business unit or individual basis, or on a combination thereof. Satisfaction of common stock ownership guidelines may also be a prerequisite to payment.

Change of Control

No award may permit acceleration of vesting or payment by reason of a Change of Control of the Company prior to the actual date on which the Change of Control is consummated, except as may be expressly provided in a written severance agreement with the participant approved by the Committee. Briefly summarized, “Change of Control” is defined in Section 14(k) of the Omnibus Plan to include (i) a change in a majority of the members of the Board since the date of the award, other than changes approved by a majority of the incumbent Board, (ii) the acquisition of a majority of the Company’s shares or voting power by a single individual, entity or group, (iii) the sale or other disposition of all or substantially all the Company’s assets, (iv) the commencement of a shareholder-approved liquidation or dissolution of the Company, or (v) the consummation of a reorganization or business combination resulting in a change in either a majority of the Company’s shares or voting power or a majority of the Company’s Board. The foregoing summary is qualified by reference to the complete definition in Section 15(k) of the Omnibus Plan attached as Appendix A to this Proxy Statement.

Amendment and Termination of the Omnibus Plan

Either the Board or the Committee may at any time amend or terminate the Omnibus Plan; provided that no amendment may be made without the approval of the shareholders if such amendment would increase either the maximum number of shares which may be granted under the Omnibus Plan or any specified limit on any particular type or types of award, or change the class of employees to whom an award may be granted, or withdraw the authority to administer the Omnibus Plan from the Committee or another committee whose members satisfy the independence and other requirements of applicable SEC and NYSE requirements. Pursuant to the listing standards of the NYSE, certain other material revisions to the Omnibus Plan may also require shareholder approval.

Subject to the specific restrictions set forth in the Omnibus Plan, the Committee may change the terms of any outstanding award and shall have plenary authority to interpret the Omnibus Plan, to prescribe, amend and rescind rules and regulations relating to the Omnibus Plan and to determine the terms and provisions of the respective Awards, provided that no amendment may reduce the rights of the recipient of the award without the recipient’s consent, and in the event of a stock dividend, stock split or reverse stock split affecting the number of shares, appropriate adjustments will be made to outstanding Awards, including but not limited to per-share based performance objectives, the number of shares awarded, and per-share option exercise prices, as in the Committee’s judgment will fairly reflect the effect of such stock dividend, stock split or reverse stock split on the interests of the recipients of awards.

If the proposed five-year extension is approved by the shareholders, the Omnibus Plan will continue until the close of the 2028 Annual Meeting of Shareholders, unless terminated earlier by the Board or the Committee, but awards outstanding at the termination of the Omnibus Plan shall continue in accordance with their terms and shall not be affected by such termination.

Federal Income Tax Consequences of Awards

The proposed amendments to the Omnibus Plan will not change the tax consequences of the various Awards. The following is a summary of the U.S. federal income tax consequences of the Awards to the participants in the Omnibus Plan and to the Company, based upon current income tax laws, regulations and rulings. Awards to participants subject to tax in non-U.S. jurisdictions may be treated differently under the tax laws of those jurisdictions.

Full Value Awards

A participant will recognize ordinary income equal to the fair market value of any shares received upon vesting and distribution of a Full Value Award and the Company will be entitled to a deduction of the same amount, subject to the deduction limits under Section 162(m) of the Internal Revenue Code.

Incentive Stock Options

An optionee does not realize income on the grant of an Incentive Stock Option. If an optionee exercises an Incentive Stock Option in accordance with its terms and does not dispose of the shares acquired within two years from the date of the grant of the option or within one year from the date of exercise, the optionee will not realize any ordinary income by reason of the

exercise, and the employer will be allowed no deduction by reason of the grant or exercise. The optionee’s basis in the shares acquired upon exercise will be the amount of cash paid upon exercise. Provided the optionee holds the shares as a capital asset at the time of sale or other disposition of the shares, the optionee’s gain or loss, if any, recognized on the sale or other disposition will be capital gain or loss. The amount of the optionee’s gain or loss will be the difference between the amount realized on the disposition of the shares and the optionee’s basis in the shares. The excess of the fair market value of the shares at the time the Incentive Stock Option is exercised over the exercise price is tax preference income taken into account in computing the alternative minimum tax applicable to individuals.

If an optionee disposes of the shares within two years from the date of grant of the option or within one year from the date of exercise, the optionee will realize ordinary income at the time of disposition which will equal the excess, if any, of the lesser of (a) the amount realized on the disposition or (b) the fair market value of the shares on the date of exercise, over the optionee’s basis in the shares. The Company will be entitled to a deduction in an amount equal to such income. The excess, if any, of the amount realized on disposition of such shares over the fair market value of the shares on the date of exercise will be long- or short-term capital gain, depending upon the holding period of the shares, provided the optionee holds the shares as a capital asset at the time of disposition.

Stock Options Other Than Incentive Stock Options

Stock Options which do not meet the requirements for Incentive Stock Options do not qualify for the special tax treatment accorded to Incentive Stock Options under the Code. Although an optionee does not recognize income at the time of the grant of the option, the optionee will recognize ordinary income upon the exercise of the option in an amount equal to the excess of the fair market value of the shares on the date of exercise of the option over the amount of cash paid for the shares. The excess of the fair market value of the shares on the date of exercise over the exercise price is not a tax preference item.

As a result of the optionee’s exercise of such an option, the Company will be entitled to deduct as compensation an amount equal to the amount included in the optionee’s gross income. If the optionee pays all or part of the option price of such an option by surrendering already-owned shares, certain additional tax rules apply.

Tandem SARs

Although the recipient of a Tandem SAR does not recognize income at the time it is granted, the recipient will recognize income when the Tandem SAR is exercised in an amount equal to the cash and the fair market value of any shares the recipient receives. The Company will be entitled to deduct as compensation an amount equal to the income recognized by the recipient.

However, so long as sale of the shares (if any) received would subject the recipient to suit under Section 16(b) of the Securities Exchange Act of 1934, the recipient does not recognize income and no tax deduction is allowed to the Company until the earlier of the expiration of six months from the date of exercise or the date on which the Section 16(b) restriction lapses. At such time, the recipient will recognize income equal to the fair market value of the stock and the Company will be entitled to a tax deduction of a like amount. The recipient may elect to recognize income upon receipt of the stock and not at the later time, in which case the tax consequences to the recipient and the Company are the same as if the recipient were not subject to the Section 16(b) restriction.

If a Tandem SAR is paid in shares, the recipient’s basis will be equal to the amount of ordinary income recognized by the recipient in respect of such shares, and the recipient’s holding period for capital gains purposes will commence on the day such income is recognized.

Other Awards

A participant will recognize ordinary income equal to the amount of cash and the fair market value of any shares received under any other awards under the Omnibus Plan and the Company will be entitled to a deduction of the same amount, subject to the limits under Section 162 of the Internal Revenue Code. However, in the case of an award of shares subject to a substantial risk of forfeiture, the recipient does not recognize income and no tax deduction is allowed to the Company until the first time the shares received are transferable or are not subject to a substantial risk of forfeiture, whichever occurs earlier; at which time the recipient will recognize income equal to the fair market value of the stock and the Company will be entitled to a tax deduction of a like amount; but if permitted under the terms of the award, the recipient may elect to recognize income upon receipt of the shares and not at a later time, in which case the tax consequences to the recipient and the Company are the same as if the shares were transferable and not subject to a substantial risk of forfeiture.

OTHER EQUITY COMPENSATION PLAN INFORMATION

As additional information in connection with this Proposal, the following table summarizes certain information regarding shares of Company common stock that may be issued by the Company pursuant to its equity compensation plans existing as of September 30, 2022. For more information about the recent and currently outstanding or unvested grants under the Omnibus Plan, see Director Compensation, above, and Proposal 3: Advisory Vote on Executive Compensation, below.

Proposal 3: Say on Pay – Advisory Vote to Approve Executive Compensation

The Board of Directors recommends a vote FOR this Proposal.

Pursuant to Section 14(a) of the Securities Exchange Act of 1934, the Board of Directors is again soliciting an advisory (non-binding) shareholder vote, commonly referred to as “Say-on-Pay”, to approve the compensation of the executive officers whose compensation is disclosed in this Proxy Statement (the named executive officers or NEOs). At our 2022 Annual Meeting, over 96% of the shares represented and entitled to vote on the Say on Pay proposal, or over 88% of all outstanding shares, were voted in support of the Say-on-Pay proposal. Unless the shareholders approve a different frequency (see Proposal 4: Advisory Vote on Frequency of Advisory Votes on Executive Compensation), we plan to continue to hold a Say-on-Pay vote every year.

The Board of Directors strongly endorses our executive compensation program and recommends that the shareholders vote in favor of the following Resolution:

“RESOLVED, that the Company’s shareholders approve, on an advisory basis, the compensation of the named executive officers as disclosed in the Company’s Proxy Statement for the 2023 Annual Meeting of Shareholders pursuant to the executive compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the Summary Compensation Table, and the other related tables and narrative disclosure.”

Shareholders are encouraged to review the Compensation Discussion and Analysis section below as well as the Summary Compensation Table and the other related tables and narrative disclosure referred to in the proposed Resolution, which provide details about our executive compensation program as well as specific information about the compensation of our named executive officers.

This vote is not intended to address any specific item of compensation, but rather the overall compensation of the named executive officers as described in this Proxy Statement. Although the vote is non-binding, the Board of Directors and the Compensation Committee value the opinions of the shareholders, and to the extent there is a significant vote against the above resolution the Company will consider the shareholders’ concerns and the Committee will evaluate what actions (if any) may be necessary to address those concerns.

SUMMARY OF EXECUTIVE COMPENSATION PROGRAM

Our executive compensation program is designed to attract, motivate, and retain executive officers who are critical to our success. The Committee believes that the program constitutes a balanced, competitive approach to compensation that supports our compensation objectives through performance-based compensation that aligns the interests of executives with those of our shareholders.

The Compensation Committee reviews our compensation program at least annually to ensure that it achieves the desired goals of aligning our executive compensation structure with shareholders’ interests and current market practices.

What We Do:			What We Don’t Do:
	16
	Pay for performance philosophy			No excessive perquisites
	Significant portion of compensation is at-risk			No tax gross-ups on perquisites
	Competitive stock ownership guidelines			No tax gross-ups on change in control severance
	Robust clawback policy			No hedging or pledging of Company stock
	Double-trigger change-in-control equity vesting			No repricing or exchange of equity-based awards without shareholder approval
	Independent compensation consultant

EXECUTIVE COMPENSATION INFORMATION

COMPENSATION COMMITTEE REPORT

The Human Resources and Compensation Committee is responsible for determining the compensation of the Chairman and Chief Executive Officer and other senior officers and key executives of the Company. The Committee has reviewed and discussed with management the Company’s disclosures under the section captioned “Compensation Discussion and Analysis” beginning immediately following this Compensation Committee Report.

Based on such review and discussion, the Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement and incorporated by reference in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 20192022 filed with the Securities and Exchange Commission.

The Human Resources and Compensation Committee

Vinod M. Khilnani, Chair
Larry W. Solley

COMPENSATION DISCUSSION AND ANALYSIS

The Human Resources and Compensation Committee is responsible for determining the compensation of the Chairman and Chief Executive Officer (the “CEO”) and other senior officers and key executives of the Company. This Compensation Discussion and Analysis discusses the compensation of the CEO and the other executive officers identified in the Summary Compensation Table on page 27, whom we refer to herein as the “executive officers” or the “named executive officers.”following NEOs:

Chairman, Chief Executive Officer & President

Senior Vice President & Chief Financial Officer

Senior Vice President, General Counsel & Secretary

2022 Performance Highlights

2022 Performance Highlights Related to Executive Compensation

The Compensation ObjectiveCommittee established two performance metrics, “Adjusted EPS” and “Cash Flow,” to determine incentive plan compensation earned during fiscal 2022 and thereby incent the participants and align cash incentive compensation with business objectives. These metrics are non-GAAP measures; for a detailed description and a reconciliation to the nearest GAAP measures, see 2022 Cash Incentive Metrics, below.

Pay for Performance

Our compensation programs are designed to maximize shareholder value by allocating a significant portion of executive compensation to at-risk pay. Our annual cash incentive program and equity-based PSUs utilize a variety of key strategic and financial performance metrics and are designed to reward positive financial performance and limit unnecessary risk taking. Stock ownership guidelines align the interests of executives and shareholders by ensuring that executives bear the economic risk of share ownership.

Compensation Objective

The Compensation Committee’s objective is to develop and maintain industry-competitive compensation packages to attract, retain, motivate and reward the Company’sour executive officers and other senior officers and key executives. Compensation programs are designed to be consistent with those of other companies engaged in similar industries and/or of similar size with which the Company iswe are likely to compete for talent to enable the Companyus to employ and retain a high-quality management team. The Committee seeks to use performance basedperformance-based compensation to maximize the alignment of executive compensation with the long-term interests of the Company’sour shareholders.

Executive Summary

The Company’s compensation programs are designed to reward positive financial performance. The cash incentive program is tied to key strategic and financial targets and is designed to reward strong performance. Payouts are higher in times of good performance and lower when targets are not achieved. The stock-based long-term equity incentive (“LTEI”) program and stock ownership guidelines align the interests of executives and shareholders by ensuring that executives bear the economic risk of share ownership. Further, under the Performance-Accelerated Restricted Share (“PARS”) awards, one of the principal elements of the LTEI program, shares may not become vested until at least 3½ years after the initial award, which contributes to the goal of executive retention. As these awards are tied to stock price, this also serves as an incentive to drive strong Company performance. Because the compensation program has historically produced the results desired by the Committee, and based on its review of the compensation program, the executive officers’ current compensation and the Company’s fiscal 2018 performance, the Committee determined that no changes to the structure of its compensation program were warranted for fiscal 2019.

Compensation Summary

The Committee offers its executive officers a compensation package that includes:

The Committee sets compensation levels based on the skills, experience and performance of each executive officer, taking into account the benchmarking described below and compensation recommendations made by the CEO (except with respect to his own position). The Committee’s pay for performance philosophy is reflected in the annual base salary and cash incentive plan targetcompensation review. For example, for fiscal 2019, as a result of the Company’s strong performance in fiscal 2018, the Committee determined that all three of the executive officers should receive increases of 4.0% in their total cash compensation (base salary plus cash incentive target) and (as it had done for 2018) provided the executive officers with the discretion to allocate the increase prospectively either all to their cash incentive targets or between their base salaries and their cash incentive targets, as described under “Base Salaries” and “Cash Incentive Compensation” below. Additionally, the Company’s LTEI awards utilize share price for acceleration, thereby closely aligning the executive officers with the shareholders on share price performance. The Committee also considers tally sheets which provide, for each executive officer, a recap of each principal element of compensation as well as benefits, perquisites, equity awards, and stock ownership and potential ownership. The tally sheets also reflect the incremental compensation which would be payable as a result of various termination scenarios and each element of pay or benefits impacted. The Committee retains the discretion to adjust all elements of compensation as it deems appropriate, subject to the requirements of shareholder-approved plans.

Executive Compensation Program Highlights

The following table summarizes the 2022 target direct compensation pay mix for the CEO and other NEOs, with approximately 77% of the CEO’s target direct compensation at risk and 59% of the average of the other NEOs’ target direct compensation at risk. Target direct compensation is defined as the sum of the executive officer’s base salary, annual cash incentive award, and annual long term equity incentive awards, in each case calculated at the target level specified by the Compensation Committee.

Compensation Consultant and Benchmarking

The Compensation Committee is authorized by its charter to employ independent compensation and other consultants. The Committee has typically engaged a nationally recognized compensation consulting firm (the “Compensation Consultant”)(Compensation Consultant) every other year to assist the Committee in evaluating executive compensation. The Compensation Consultant provides information, research and analysis pertaining to executive compensation as requested by the Committee, including updates on market trends, survey data and analysis for market review. The Committee also from time to time engages itsour primary outside counsel, Bryan Cave Leighton Paisner LLP (“BCLP”)(BCLP) to advise it on selected executive compensation issues.

2018The Committee conducts a peer and market review every two years; the most recent review was in 2020, as described below.

2020 Compensation Report (Fiscal 20192021 Compensation Review).

In the summer of 20182020, the Committee engaged Pay Governance LLC as the Compensation Consultant to provide a compensation report (the “20182020 Compensation Report”)Report) for the Committee’s fiscal 20192021 compensation review. One of the elements of the 20182020 Compensation Report was the Willis Towers Watson 2018 General Industry2020 Mercer Benchmark Database/Total Remuneration Survey – Executive Compensation Survey Report – U.S. (the “WTW Market Survey”)(Mercer Survey), a broad-based survey of management compensation, as the primary source for benchmarking its executive compensation levels. A broad market survey provides decision-quality data that is generally reliable and consistent year-over-year. The Company was amongdid not participate in the over 750 participating companies which contributed management compensation data for the WTW MarketMercer Survey. A list of all of the participating companies included in the WTW MarketMercer Survey is attached as Appendix AB to this Proxy Statement.

For its 20182020 Compensation Report, the Compensation Consultant also provided proxy data from the peer group described below (the “2018(2020 Peer Group”)Group) to be used in conjunction with the WTW MarketMercer Survey in order to add context to the decision-making process and provide a supplemental perspective on the market. Peer group proxy data provides transparent line-by-line information for each company in the peer group, and provides the ability to review industry trends and compensation design practices as well as pay-for-performance alignment. The 20182020 Peer Group was based on the SIC codes assigned to the Company’s subsidiaries and represented companies in the following industries in which the Company participates:

Companies in the above industries were then filtered for revenue size in order to determine the 20182020 Peer Group. The following is a list of the companies in the 20182020 Peer Group:Group, with their ticker symbols:

Fiscal 2022 Benchmarking

* Peer group proxy data not available for the General Counsel position.

Fiscal 2019 Benchmarking.For its compensation review for fiscal 20192022, the Committee reviewed each principal element of compensation (base salary, cash incentive and LTEI)LTI), as well as total cash compensation (base salary and cash incentive), and total direct compensation (target cash compensation and LTEI)LTI) for each of the Company’s executive officer positions, and compared them against the annual median and 75^th percentile market ratesbenchmark range from the WTW Market Survey and for the 2018 Peer Group.Compensation Report, as aged by 3%. The CEO’s benchmark range for each element of compensation in the Compensation Report is from the median to the 75^th75th percentile, in a surveyas aged by 3%. The benchmark range for the CFO and the General Counsel is referred to hereinafter as the “Benchmark Range”median plus or minus 15% for that survey and thateach element of compensation.compensation in the Compensation Report, as aged by 3%. For fiscal 2019,2022, the Committee utilized the Benchmark Rangesbenchmark ranges from the WTW Market Survey and the 2018 Peer GroupCompensation Report in determining the competitiveness of the executives’ compensation. The Committee also compared relative Company performance against the performance of the companies in the 20182020 Peer Group to test the overall reasonableness of pay for performance.

The Committee used the WTW Market Survey and 2018 Peer Group dataCompensation Report described above as a guideline and frame of reference in determining appropriate compensation levels and incentives for the executive officers; however, the Committee does not make its decisions according to a formula, and the Committee exercises considerable judgment and discretion in making them. The complexity and composition of the Company (consisting of four primary business lines) does not lend itself to comparisons with a readily ascertainable peer group, and while matching by SIC codes can provide some measure of comparability, there are wide variations in the type and complexity of these companies. The Committee therefore considers the Benchmark Rangesbenchmark ranges to be only a guide, and makes individual determinations of compensation for each of the executive officers based on numerous factors including the comparative responsibilities of the executive officers and the Committee’s assessments of individual and Company performance.

Compensation Consultant Independence.

In August 2019,2022, the Committee assessed the independence of Pay Governance and BCLP in line with the SEC’s compensation consultant independence factors, and determined there were no conflicts of interest. The Committee will continue to review their independence status at least annually and will keep the compliance letters on file.

Principal Elements of Compensation Program

The principal elements of the 2022 compensation program for executive officers (base salary, annual cash incentive and long-term equity incentive) are reflected in the Summary Compensation Table on page 27.44. Each of these elements is described in detail in the corresponding sections below.

The Company does

We do not believe that any risks arising from itsour compensation policies and practices are reasonably likely to have a material adverse effect on the Company. Any such risk is mitigated by the multiple elements of the compensation programs, including base salary, annual cash incentive programs, and LTEILTI awards which are earned over multiple years. This structure encourages decision-making that is in the best long-term interests of the Company and theour shareholders.

Based on its review of the compensation program, the executive officers’ current compensation and the Company’s fiscal 2018 performance, the Committee determined that noapproved several changes toin the structure of its compensation program were warranted forbeginning in fiscal 2019.2021 and continuing into fiscal 2022, including eliminating the tax gross-up on perquisites, and changing the types of equity awards to be granted under the LTI program from time-vested, performance-accelerated PARS awards to PSUs and RSUs.

Total Direct Compensation.

The executive officers receive total direct compensation consisting of cash compensation (base salary plus annual cash incentive compensation) and long-term equity incentive compensation. Each of these elements is described in detail in the corresponding sections below.

The Committee sets target levels for total direct compensation based on the skills, experience, breadth of their role, and performance of each executive officer, taking into account the benchmarking described above and compensation recommendations made by the CEO (except with respect to his own position). The Committee also considers the performance of the Company.Company’s performance. For fiscal 2019, the Committee noted several positive fiscal 2018 performance factors, including strong Company sales and earnings and the completion of the Manta acquisition. As a result of the Company’s performance in fiscal 2018,2022, the Committee increased the executive officers’ total direct compensation as described in detail below. Total direct compensation for fiscal 20192022 was within the WTW Market Survey and 2018 Peer Group Benchmark Rangesbenchmark ranges for Mr. Richey, above the WTW Market SurveyMr. Tucker and 2018 Peer Group Benchmark Ranges for Mr. Muenster, and slightly above the WTW Market Survey Benchmark Range and within the 2018 Peer Group Benchmark Range for Ms. Barclay.Schatz.

Base Salaries. 

Base salaries are designed to attract, retain, motivate and reward competent, qualified, experienced executives. The Company emphasizesexecutives, although we emphasize performance-based compensation for the executive officers. At the discretion of the Committee, with input by the CEO, executive officers with significant experience and responsibility who consistently demonstrate exemplary performance may be paid above the Benchmark Ranges for their positions.

Fiscal 20192022 base salaries for the executive officers were set by the Committee atin the beginningfirst quarter of fiscal 2019. The salaries were based on the Committee’s review of current salary levels and total cash compensation (base salary plus cash incentive target) compared to the WTW Market Survey and 2018 Peer Group Benchmark Ranges for each position, as adjusted for the relative value of the jobs within the Company compared to those in the comparison surveys. The Committee also took into account, for Mr. Richey, fiscal 2018 individual and Company performance, and for the other executive officers, a subjective evaluation of the executives’ fiscal 2018 performance with input from Mr. Richey. Based on the factors considered, the Committee determined that for each of the executive officers a 4.0% increase in total cash compensation was warranted for 2019, and as it had done for 2018, it provided the executive officers with the discretion to allocate the increase prospectively either all to their cash incentive target or between their2022. Annual base salary and their cash incentive target. Mr. Richey elected to allocate all of his increase to his cash incentive target, and Mr. Muenster and Ms. Barclay elected to allocate their increases between their base salaries and their cash incentive targets. Base salaries for fiscal 2019 were slightly above the Benchmark Ranges for Mr. Richey, above the Benchmark Ranges for Mr. Muenster, and within the Benchmark Ranges for Ms. Barclay.

Base salaries for the executive officers for fiscal 20192022 and fiscal 20182021 were as follows:

Base Salaries