ITEM 1. ELECTION OF DIRECTORSBackground of the Solicitation

On February 14, 2017, CNBC reported that, according to unnamed sources, Trian had taken a substantial position in the Company, estimated to be around $3.5 billion.

On February 14, 2017, Trian filed a Schedule 13F with the SEC disclosing beneficial ownership of 6,416,284 shares of the Company’s outstanding common stock by certain Trian funds. As of its most recent 13F filing on May 12, 2017, Trian disclosed beneficial ownership of 36,718,855 shares of the Company’s outstanding common stock.

On February 16, 2017, Nelson Peltz, Chief Executive Officer and Founding Partner of Trian, contacted the Company’s Investor Relations department, requesting to speak with Mr. Taylor. Mr. Taylor returned the call, and Mr. Peltz informed Mr. Taylor that Trian had taken a large investment stake in the Company. Mr. Peltz said that he would like the dialogue to be constructive and that he would like to set up a meeting to discuss his thoughts and ideas about the Company. Mr. Taylor agreed to do so, and the parties subsequently scheduled a meeting for March 7.

On February 27, 2017, pursuant to applicable U.S. antitrust laws, Trian provided a letter to the Company stating its intention to file notifications under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), to enable certain investment funds affiliated with Trian to acquire voting securities of the Company. On March 16, 2017, the Federal Trade Commission granted early termination of the waiting periods applicable under the HSR Act with respect to those notifications.

On March 7, 2017, Messrs. Taylor and Moeller met with Mr. Peltz and Ed Garden, Founding Partner and Chief Investment Officer of Trian. At this meeting, Messrs. Peltz and Garden provided a brief overview of their firm. Messrs. Peltz and Garden said that Trian had done an analysis of the Company and was of the belief that the Company had opportunities to improve its performance and earnings. Mr. Peltz suggested that Trian could help the Company drive these results and that he would like a Board seat, saying that he could be far more helpful working from the inside. The parties discussed some of Trian’s suggestions,¹ and Mr. Taylor also committed to confer with the Company’s Directors and to get back to Mr. Peltz regarding his Board seat request and potential next steps in the parties’ engagement.

Between March 7 and March 17, Mr. Taylor had conversations with several members of the Company’s Board regarding the meeting with Mr. Peltz and his request for a Board seat.

On March 17, 2017, Messrs. Peltz and Garden called Mr. Taylor. Mr. Peltz reiterated his request for a seat on the Company’s Board of Directors, emphasizing that he only wanted one seat and that he wanted it for himself. Mr. Taylor told Mr. Peltz that the Board did not think adding Mr. Peltz to the Board was appropriate at this time, and that he would prefer to continue with a constructive engagement. The parties agreed to meet again in person and scheduled a meeting for April 24.

On April 11, 2017, the Board of Directors held its regularly scheduled April meeting at the Company’s headquarters. During the meeting, the Board appointed Amy L. Chang to the Board, effective June 1, 2017. The Board also discussed the engagement with Trian and Mr. Peltz’s request for a Board seat for himself.

On April 12, 2017, the Company announced the appointment of Amy L. Chang to the Company’s Board, effective June 1, 2017. On the same day, Mr. Taylor had a phone call with Mr. Peltz. Mr. Taylor informed Mr. Peltz that the Company had been engaged in a search for a new Director for the past six months, and that the Board believed Ms. Chang’s extensive digital experience would be a great addition to the skillset of the Company’s Board. Mr. Peltz was very supportive of the appointment of Ms. Chang to the Board. Mr. Taylor also invited Mr. Peltz to attend the Company’s upcoming Global Leadership Council (GLC) meeting on May 4, which would include the Company’s top 30 executives, and share his views about the Company. Mr. Peltz agreed this would be a good idea and noted that the invitation reflected P&G’s willingness to listen. Messrs. Taylor and Peltz also reconfirmed their plan to meet on April 24.

¹ In this conversation, as well as all others between representatives of the Company and Trian, the parties discussed material Company results or strategic plans only to the extent that they were publicly available.

On April 24, 2017, Messrs. Taylor and Moeller met with Messrs. Peltz and Garden, and Josh Frank, Senior Analyst and Partner at Trian. Mr. Peltz stated that he did not want to talk about the Company’s product portfolio, capital structure, or about changing management. Mr. Peltz said that the Company was moving in the right direction, but that it needed to move faster, and that management needed to make more significant cost cuts and organizational changes. The group discussed a number of ideas about the Company’s cost structure, and Mr. Peltz reiterated that he believed he could be a very helpful addition to the Company’s Board. The group also confirmed Mr. Peltz’s attendance at the upcoming GLC meeting.

On May 4, 2017, Messrs. Peltz and Frank came to the Company’s GLC meeting, where Mr. Peltz spoke to the GLC for approximately an hour. The format for the presentation was an interview with Mr. Peltz, moderated by Mr. Taylor. Mr. Peltz outlined for the GLC the same perspective on the Company that he had provided to Messrs. Taylor and Moeller in the April 24, 2017 meeting.

On May 8, 2017, Messrs. Peltz and Taylor had a phone call, during which Mr. Peltz continued to ask for a seat on the Company’s Board, stating he believed he could be more helpful as an insider, with access to more detailed information. Mr. Peltz also indicated that he would like to meet with the other members of the Company’s Board to discuss the potential appointment. Mr. Taylor agreed to schedule a meeting that would include W. James McNerney, Jr., the Company’s Lead Independent Director.

On May 18, 2017, Messrs. Taylor and McNerney met with Mr. Peltz. Mr. Peltz reiterated that he wanted to maintain a constructive relationship and restated the reasons why he believed he should be added to the Company’s Board. Mr. Peltz stated that he did not want to break up the Company and that the Company is generally on the right track, but needs to move faster in terms of making organizational changes and increasing productivity savings. Mr. McNerney told Mr. Peltz that the Company had a plan, that the Board fully supported that plan, and they wanted to give management the opportunity to execute it. Mr. McNerney also stated that if, by next year, the current plan was not producing satisfactory results, the Company and the Board would certainly consider whether any changes were appropriate. Mr. McNerney told Mr. Peltz that, while the Company wanted to continue to engage cooperatively with Trian, the Board had discussed Mr. Peltz’s request and did not believe that a Board seat was appropriate at this time. Mr. Peltz said that the Company would receive a Notice of Nomination from Trian, as Mr. Peltz needed to preserve all his options for now. Messrs. Taylor and McNerney informed Mr. Peltz that it would be difficult to continue with constructive engagement in the event of a potential proxy contest. Mr. Peltz told Messrs. McNerney and Taylor that he had to have something for his investors. The parties discussed alternatives for avoiding a proxy contest, but made no agreements. Messrs Taylor and McNerney were not willing to make any public commitments to add Mr. Peltz to the Company’s Board contingent on whether the Company met certain performance or operating metrics over the next 12 months. While no agreement was reached during the meeting, the parties agreed to continue to consider alternatives.

On May 18, 2017, Trian also delivered a notice of its intent to nominate Mr. Peltz to stand for election to the Board of Directors of the Company at the Annual Meeting and stating that Trian would solicit proxies in support of such election.

On May 22, 2017, as a possible alternative to a proxy contest, Mr. Taylor sent Mr. Peltz an email that included a potential press release that the Company could issue, which would describe the Company’s engagement with Trian.

On May 24, 2017, Mr. Peltz sent Mr. Taylor an email saying that he appreciated the spirit of Mr. Taylor’s proposal, and his initial reaction was to ask the Company to include specific performance and operating commitments in the public statement, with an additional commitment to appoint Mr. Peltz to the Company’s Board if those performance and operating commitments were not met within the next 12 months. Mr. Peltz also stated in his email that he understood why an agreement subject to an arbitrary one-year period would be difficult for Mr. Taylor and the Board. In Mr. Peltz’s email correspondence, he indicated he was more focused on the Company’s long-term performance rather than the next twelve months. Mr. Peltz further noted in the email that if Trian and the Company could not reach agreement, he would take his Board candidacy to shareholders at this year’s Annual Meeting.

On May 25, 2017, Mr. Taylor responded to Mr. Peltz’s message, saying that he had hoped for a more constructive response, and that, as acknowledged by Mr. Peltz, a one-year performance period was arbitrary. Mr. Taylor also stated that if the parties were engaged in a proxy contest, it would be difficult to continue engaging constructively as they had been doing to date. Mr. Taylor offered to discuss the proposed press release further. Mr. Peltz sent a reply email later that day, saying that he understood that an agreement subject to a one-year performance period could be difficult for Mr. Taylor and the Board and that he did not want the Company to make any commitments that could detract from its long-term performance. Mr. Peltz said that he hoped to continue their discussions and avoid a proxy contest, and suggested that he and Mr. Taylor meet in person.

On June 1, 2017, Mr. Taylor and Mr. Peltz met for dinner. Mr. Peltz reiterated his view that it was critical for him to be on the Board in order to be the most helpful. Mr. Taylor informed Mr. Peltz that this was a decision for the entire Board of Directors. Mr. Peltz requested to meet with the Company’s Directors to discuss, and Mr. Taylor said he would discuss the matter with the Board and provide a response.

On June 14, 2017, Mr. Taylor called Mr. Peltz and offered to set up a meeting that would include three other members of the Board – Mr. McNerney, Angela Braly, and Kenneth Chenault. The parties agreed on a July 11 meeting date.

On June 16, 2017, CNBC and other news outlets reported that, according to unnamed sources, Trian had submitted a Director nomination to the Company.

On June 19, 2017, Mr. Peltz tried to call Mr. Taylor, and Mr. Taylor returned the call. Mr. Peltz said that he wanted Mr. Taylor to know that Trian was not the source of the June 16 news stories. Mr. Peltz also indicated that, while he was disappointed there would only be three independent Directors in the July 11 meeting, he still hoped the parties could avoid a proxy contest. He said that it would be about a month before he would need to go public with the contest and suggested that he and Mr. Taylor meet for dinner again.

Between June 19, 2017 and July 11, 2017, Mr. Taylor and Mr. Peltz had some conversations to agree on the expectations and attendees for the July 11 meeting.

On July 11, 2017, Messrs. Taylor, McNerney, and Chenault met with Messrs. Peltz and Frank, with Ms. Braly joining the meeting by phone. Mr. Peltz reiterated his perspective previously shared with Messrs. Taylor and Moeller regarding the need for the Company to make more significant organizational changes and increase productivity savings, in each case at a faster pace. He also restated his request for a Board seat, based on the premise that he could be more helpful and constructive working from the inside. The Company’s representatives listened to Mr. Peltz’s ideas, but did not agree to give him a Board seat. Mr. Peltz stated that if he were not given a Board seat, he may opt to proceed with a proxy contest.

On July 17, 2017, Trian publicly filed its preliminary proxy statement with regard to its nominees and proposals and the Company publicly filed its preliminary proxy statement with regard to its nominees and proposals.

Later in the day on July 17, 2017, Mr. Peltz and Mr. Taylor spoke by telephone after Mr. Peltz’s interview with CNBC. Mr. Peltz re-expressed his support for Mr. Taylor, and that he hoped that came across. Mr. Peltz told Mr. Taylor that he should put Mr. Peltz on the Board and avoid a proxy contest. Mr. Taylor told Mr. Peltz that, while he appreciated that he was respectful in his interview, Mr. Taylor thought that several things that Mr. Peltz said about the Company in his interview were incorrect. Mr. Taylor also stated that the Board continued to believe that adding Mr. Peltz to the Board was not the right choice.

On July 20, 2017, Mr. Peltz called Mr. McNerney indicating that he was in Chicago and that he would like to meet with Mr. McNerney that day if he was available, to which Mr. McNerney responded that he was not. Mr. Peltz suggested, and Mr. McNerney agreed, that the two individuals should strive to maintain an open dialogue over the coming months. Mr. Peltz said he would contact Mr. McNerney when Mr. Peltz returned from travel and try to schedule a meeting.

Our Board of Directors has general oversight responsibility for the Company’s affairs pursuant to Ohio’s General Corporation Law and the Company’s Amended Articles of Incorporation, the Code of Regulations, and the By LawsBy-Laws of the Board of Directors. In exercising its fiduciary duties, the Board represents and acts on behalf of the Company’s shareholders and is committed to strong corporate governance, as reflected through its policies and practices. The Board is deeply involved in the Company’s strategic planning process, leadership development, succession planning, and oversight of risk management.

Our Board of Directors has nominated 13 directorsthe 11 Directors listed on pages 12 to 15 for election at the Annual Meeting.2017 annual meeting. Each of the Director nominees currently serves on the Board and was elected for a one-year term at the 20142016 annual meeting, with the exception of Messrs. Blake and Taylor,Amy L. Chang, who werewas appointed to the Board in February 2015 and July 2015, respectively.effective June 2017. The current terms of all nominees for Director will expire at the 20152017 annual meeting. Themeeting, and the Board has nominated each of these individuals for a new one-year term that will expire at the 20162018 annual meeting.

Each of the Director nominees for Directoridentified in this proxy statement has consented to being named as a nominee in our proxy materials and has accepted the nomination and agreed to serve as a Director if elected by the Company’s shareholders. If any nominee becomes unable or unwilling to serve between the date of the proxy statement and the annual meeting, the Board may designate a new nominee, and the persons named as proxies will vote on that substitute nominee.

Our Board of Directors unanimously recommends using the enclosed BLUE proxy card to vote FOR each of the Board’s 11 Director nominees.Trian notified the Company that it intends to nominate a nominee for election as a Director at the annual meeting. As a result, if Trian proceeds with its alternative nomination, the number of Director nominees will exceed the number of Directors to be elected, and the 11 nominees who receive the greatest number of votes cast will be elected.

Our Board of Directors recommends that you simply DISREGARD any proxy card that may be sent to you by Trian and only vote using the enclosed BLUE proxy card. Voting AGAINST Trian’s nominee on its proxy card isNOT the same as voting FOR our Board’s Director nominees because a vote against Trian’s nominee on its proxy card will revoke any previous proxy submitted by you, including any vote you may have made for our Board’s nominees. If you have already voted using the white proxy card sent to you by Trian, you may change it by voting in favor of our Board’s Director nominees using the enclosed BLUE proxy card or by voting via Internet or by telephone by following the instructions provided on the enclosed BLUE proxy card. Only the latest validly executed proxy that you submit will be counted. If you have any questions, please contact D.F. King & Co., Inc. or Mackenzie Partners, Inc., our proxy solicitors assisting us in connection with the annual meeting, by calling toll free (877) 361-7966 or (800) 322-2885 or emailing p&g@dfking.com or P&G@mackenziepartners.com.

Director Skills, Qualifications, and Diversity

Procter & Gamble is a global consumer products company, serving consumers around the world with sales in more than 180 countries and territories. A company of our size and complexity must have strong governance, as well as leadership with an understanding ofleaders who understand our diverse consumers and global needs. The current composition of the Board reflects an appropriate mix of skill sets, experience, and qualifications that are relevant to the business and governance of the Company. Each individual Director epitomizes the Company’s Purpose, Values and Principles, possesses the highest ethics and integrity, and demonstrates commitment to representing the long-term interests of the Company’s shareholders. Each Director also has individual experiences that provide practical wisdom and foster mature judgment in the boardroom. Collectively, the Directors bring business, international, government, technology, marketing, retail consumer products, and other experiences that are relevantpertinent to the Company’s global operations. The chart on the following page provides additional detail regarding some of the key experiences and skills of our Director nominees. Skills and experiences are one aspect of diversity highly valued by the Board. In fact, this desired combination of skills and diversity is reflected in ourOur Corporate Governance Guidelines (“Governance Guidelines”), which set forth the minimum qualifications for Board members and specify that the Board “seeks to achieve a mix of Board members that represents a diversity of background and experience, including with respect to age, gender, international background, race and specialized experience.”

Although the Board does not establish specific goals with respect to diversity, the Board’s overall diversity is a significant consideration in the Director nomination process. The Governance & Public Responsibility (“G&PR”) Committee reviews the Director nominees (including any shareholder nominees) and ascertains whether, as a whole, the group meets the Governance Guidelines in this regard. For this year’s election, the Board has nominated 1311 individuals who bring tremendousvaluable diversity to the Board. Their collective experience covers a wide range of countries, geographies, and industries. These 1311 Director nominees range in age from 5440 to 68, and five68. Four of these 1311 Directors, or 38%36% of our current Board, are women; one is African-American; and one is Mexican. The Board views this overall diversity as a clear strength.three are ethnically diverse.

The Board also believes that tenure diversity should be considered in order to achieve an appropriate balance between the detailed Company knowledge and wisdom that comes with many years of service and the fresh perspective of newer Board members. Our current Board has an averagea good balance of experienced and new Directors, with tenure of 6.4the current Directors averaging 8 years.

The Board of Directors recommends a vote FOR each of the following Director nominees to hold office until the 20162018 annual meeting of shareholders and until their successors are elected.

In addition to the information above, Exhibit C sets forth information relating to our Directors, nominees for Directors, and certain of our officers and employees who may be considered “participants” in our solicitation under the applicable Securities and Exchange Commission’s (“SEC”) rules by reason of their position as Directors of the Company or as nominees for Directors or because they may be soliciting proxies on our behalf.

The Board’s Leadership Structure

The Board regularly considers the appropriate leadership structure for the Company and has concluded that the Company and its shareholders are best served by the Board retaining discretion to determine whether the same individual should serve as both Chief Executive Officer (“CEO”) and Chairman of the Board, or whether the roles should be separated. This approach allows the Board to utilize its considerable experience and knowledge to elect the most qualified Director as Chairman of the Board, while maintaining the ability to separate the Chairman of the Board and CEO roles when necessary. Accordingly, at some points in the Company’s history, the CEO and Chairman of the Board roles were held by the same person. At other times, the roles were held by different individuals. The Board believes that it is important to retain the flexibility to make this determination at any given point in time based on what it believes will provide the best leadership structure for the Company and best serve the interests of the Company’s shareholders.

During the Board’s annual evaluation of its leadership structure, in June, the Board was also considering plans to execute the upcoming CEO succession. Uponand upon recommendation of the G&PR Committee, the non-employee Directors of the Board concluded that the Board should retaincurrent leadership structure continues to be the currentright leadership structure for the Company forat this time and that it is in the remainderbest interest of the shareholders to maintain the combined Chairman and CEO role currently held by Mr. Lafley’s tenureTaylor. The Board believes that Mr. Taylor has served the Company well as Chairman and CEO, and that itthis combined structure provides unified leadership and focus on the Company’s strategy, business plans, and productivity efforts. The Board also recognizes that the combined Chairman and CEO role has worked well in the past and that introduction of a split leadership structure would not be in the best interests of the shareholders to separate the role of Chairman of the Board and CEO duringCompany at this time.

In July, the Board decided to split the Chairman and CEO roles, when it elected Mr. Taylor as President and Chief Executive Officer and Mr. Lafley as Executive Chairman, both effective November 1, 2015. This action is consistent with the Company’s past practice of retaining a prior CEO as the Chairman for a transition period. The Board determined that it would be in the best interest of the Company to split the roles to provide for continuity of Board leadership and strategic oversight by retaining Mr. Lafley, who is very experienced, as the Chairman of the Board during this time of transition. This will allow Mr. Taylor to focus on business matters and his role as the new CEO. As CEO, Mr. Taylor will report to the Board and, given his appointment as a Director, will attend all Board meetings. The Board believes that Mr. Lafley and Mr. Taylor will work collaboratively with the Board through this CEO transition, especially during this time of major strategic transformation for the Company.

At any time whenWhen the Board determines that the same individual should hold the positions of CEO and Chairman of the Board, or at any time whenif the Chairman of the Board is not independent, the independent Directors of the Board annually elect a Lead Director from among the independent Directors.Directors, for an annual term. The Lead Director role is a significant one, with responsibilities consistent with accepted best practices, including:

Mr. McNerney serves as the Board’s current Lead Director and has been re-elected annually re-elected to that role since August 14, 2007. Mr. McNerney is a strong, independent Lead Director, who fulfilled each of thesethe above duties during the past year. He has helped lead the Board through executive leadership transitions and the Company’s recent major strategic transformation. As the currentformer CEO and Chairman of the Board of The Boeing Company, and former CEO of Boeing and 3M Company, he brings a wealth of diverse experiences and outside perspective to his Lead Director role, which allows him to serve as Lead Director. a trusted advisor to Mr. Taylor and ensure efficient and effective Board engagement.

In FY 2014-15,2016-17, the independentnon-employee Directors, led by Mr. McNerney, met 76 times in regularly scheduled executive sessions without(without the presence of Mr. Lafley present.Taylor or other employees of the Company) to discuss various matters related to the oversight of the Company, the management of Board affairs, succession planning for the Company’s top management, and the CEO’s performance. Mr. McNerney led those sessionsfosters an open and followingconstructive dialogue among the independent Directors, and after each heexecutive session, Mr. McNerney advised Mr. LafleyTaylor on the Board’sindependent Directors’ discussions, including performance feedback.feedback, and followed up on meeting outcomes and deliverables.

In June 2015,2017, in conjunction with the Board’s decision to maintain the combined Chairman and CEO role, as recommended by the G&PR Committee, the non-employee Directors reappointed Mr. McNerney to serve as Lead Director for FY 2015-16, and in July 2015, the2017-18. The Board reaffirmed this appointment in conjunction with the election ofis confident that Mr. Lafley as Executive Chairman. Mr. Lafley,Taylor, as Chairman and current CEO, and Mr. McNerney, as Lead Director, will continue to work well together, and the Board is confident that the appropriate balance of power will be maintained and that this collaborative relationship will continue as Mr. Taylor becomes CEO.maintained. The Board will continue to periodically evaluate the Company’s leadership structure to ensure that the Board’s structure is right and appropriate at all times.structure.

Director Independence

The Board has determined that all of the Company’s Directors, with the exception of Messrs. Lafley andMr. Taylor, are independent under the New York Stock Exchange (“NYSE”)NYSE’s listing standards and the Independence Guidelines. All members of the Board’s Audit, Compensation & Leadership Development, Governance & Public Responsibility, and Innovation & Technology Committees are independent under the NYSE listing standards and Independence Guidelines, and all members of the Audit Committee are also compliant with the Securities and Exchange Commission’s (“SEC”)SEC enhanced independence requirement for audit committee members. The Board of Directors has determined that Ms. Woertz and Mr. Chenault meet the criteria for “Audit Committee Financial Expert” as defined by SEC rules. The Board of Directors has also determined that all Audit Committee members are financially literate.

In making these independence determinations, the Board applied the NYSE listing standards and the categorical independence standards contained in the Board of Directors’ Guidelines for Determining the Independence of its Members (the “Independence Guidelines”). Under the Independence Guidelines, certain relationships were considered immaterial and, therefore, were not considered by the Board in determining independence, but were reported to the Chair of the G&PR Committee. Applying the NYSE listing standards and the Independence Guidelines, the Board determined that there are no transactions, relationships, or arrangements that would impair the independence or judgment of any of the Directors deemed independent by the Board.

Mr. LafleyTaylor is Chairman of the Board, President and CEO and Mr. Taylor is Group President—Global Beauty, Grooming and Health Care of the Company. Because both are employeesAs an employee of the Company, theyhe cannot be deemed independent under the NYSE listing standards or the Independence Guidelines.

Board Meetings and Committees of the Board

Our Directors are active and engaged. Board agendas are set in advance by the Chairman of the Board and Lead Director to ensure that appropriate subjects are covered and that there is sufficient time for discussion. Committee Chairs also work closely with management to set agendas for Committee meetings to ensure that relevant subjects are reviewed by the Committees. Directors are provided with comprehensive materials in advance of Board and Committee meetings and are expected to review these materials before each meeting to ensure that time in Board and Committee meetings is focused on active discussions versus lengthy presentations. During the fiscal year ended June 30, 2017, the Board held 7 meetings, and the Committees of the Board collectively held 20 meetings, for a total of 27 meetings. Average attendance at these meetings by Directors during the past year was 95%, and all Directors attended greater than 75% of the meetings of the Board and the Committees on which they serve. The Board expects all Directors to attend the annual meeting of shareholders; all Directors, with the exception of Amy Chang, who joined the Board in June 2017, attended the October 11, 2016 annual meeting.

To assist the Board in discharging its duties and to facilitate deeper penetration into certain key areas of oversight, the Board has established four standing committees. Each committee is fully independent under the NYSE

listing standards and the Independence Guidelines, which can be found atwww.pginvestor.comwww.pg.com.

The charter for each of these committees can be found in the corporate governance section of the Company’s website atwww.pginvestor.comwww.pg.com.

Audit Committee

TheAudit Committee has the responsibilities set forth in its charter with respect to:

At each meeting, representatives of Deloitte & Touche LLP, the Company’s independent registered public accounting firm, and financial management were present to review accounting, control, auditing, and financial reporting matters. During certain of these meetings, the Audit Committee also held private sessions with the Company’s CFO, Chief Legal Officer, Chief Ethics & Compliance Officer, chief audit executive, and representatives of Deloitte & Touche LLP.

Compensation & Leadership Development Committee

TheC&LD Committee has a charter, under which:

The CEO makes recommendations to the C&LD Committee regarding the compensation elements of the principal officers (other than his own compensation) based on Company performance, individual performance, and

input from Company management and the Committee’s independent compensation consultant. All final decisions regarding compensation for principal officers are made by the C&LD Committee, and the C&LD Committee makes a recommendation to the Board regarding the shareholder votes related to executive compensation. For more details regarding principal officer compensation or the C&LD Committee’s process for making decisions regarding the compensation of principal officers, please see the Compensation Discussion & Analysis section found beginning on page 27 of this proxy statement. The C&LD Committee retains an independent compensation consultant, hired directly by the Committee, to advise it regarding executive compensation matters.

Governance & Public Responsibility Committee

TheG&PR Committee has governance responsibilities set forth in its charter with respect to:

TheG&PR Committee also covers public responsibility topics, including:

Innovation & Technology Committee

TheI&T Committee has the responsibilities set forth in its charter with respect to reviewing and making recommendations to the Board on major strategies for technical and commercial innovation to increase shareholder value and other subjects relating to:

The I&T Committee reviews annually:

The Board’s Oversight of Risk

The Company’s senior management has the responsibility to develop and implement the Company’s strategic plans, and to identify, evaluate, manage, and mitigate the risks inherent in those plans. It is the responsibility of the Board to understand and oversee the Company’s strategic plans, the associated risks, and the steps that senior management is taking to manage and mitigate those risks. The Board takes an active approach to its role in overseeing the development and execution of the Company’s business strategies as well as its risk oversight role. This approach is bolstered by the Board’s leadership and committee structure, which ensures proper consideration and evaluation of potential enterprise risks by the full Board under the auspices of the Chairman of the Board and Lead Director, and further consideration and evaluation of discretecertain risks at the committee level.

RiskAs part of its strategic risk management oversight, by the full Board includesconducts a number of reviews throughout the year to ensure that the Company’s strategy and risk management is appropriate and prudent, including:

In addition, the Board has delegated certain risk management oversight responsibilities to specific Board committees, each of which reports regularly to the full Board. In performing these oversight responsibilities, each committee has full access to management, as well as the ability to engage independent advisors.

Compensation-Related Risk

In addition to the efforts of the Board and Board Committees to manage risk oversight, the Board’s C&LD Committee annually reviews our compensation policies and practices. The Board’s C&LD Committee employs an independent compensation consultant, Frederic W. Cook & Co., Inc., who does not work for management and, among other tasks, reviews and reports on all of the Company’s executive compensation programs, including the potential risks and other impacts of incentives created by the programs. For more details on the arrangement with Frederic W. Cook & Co., Inc., please see the section entitled “Engagement of Independent Adviser” found on page 3437 of this proxy statement.

The independent compensation consultant’s review included an analysis of the Company’s short-, medium-, and long-term compensation programs covering key program details, performance factors for each program, target award ranges, maximum funding levels, and plan administrative oversight and control requirements. Key program elements assessed relating to potential compensation risks were pay mix, performance metrics, performance goals and payout curves, payment timing and adjustments, severance packages, equity incentives, stock ownership requirements, prohibitions on hedging and pledging, and trading policies. Simultaneously, membersMembers of management also performed a similar review of the Company’s other compensation programs.programs including maximum program spending, payment authorizations and confirmation that plans do not encourage excessive risk-taking. The results of the consultant’s analysis of the Company’s executive compensation programs, as well as management’s review of the Company’s other compensation programs, were shared with the C&LD Committee, which concluded that the Company’s compensation policies and practices are not reasonably likely to have a material adverse effect on the Company as a whole.Company.

In reaching its conclusion, the C&LD Committee noted that the Company’s compensation programs include a mix of cash and equity, as well as annual, medium-term, and long-term incentives. This mix of compensation, the

design features of these programs, and the Company’s respective oversight and control requirements mitigate the potential of any individual inclination toward taking unnecessary risks. The C&LD Committee also acknowledged various other features of the Company’s compensation programs, policies, and practices designed to mitigate unwarranted risk. For example, the Company’s annual cash bonus program, the Short-Term Achievement Reward (“STAR”),STAR, provides the C&LD Committee with discretion to reduce or eliminate any award that would otherwise be payable. In addition, the performance metrics under STAR include both quantitative measures (e.g., top-line growth, bottom-line profits, free cash flow, etc.) and qualitative measures (e.g., relative performance, internal collaboration, strategic strength, innovation, etc.). These non-metric features mitigate the risk of an executive focusing too much on

the specific financial metrics under STAR. Moreover, the performance metrics associated with the STAR Company Factor (core earnings per share growth and organic sales growth) are aligned with the Company’s business plans and strategic objectives.

Further, the C&LD Committee recognized that the Company’s longer-term incentives include a balanced portfolio of stock options, restricted stock units, and performance-vested stock (under the Performance Stock Plan)Program, or PSP). These longer-term incentives incorporate a variety of payout horizons that focus executives on long-term performance: 10-year terms with three-year cliff vesting for stock options, five-yearthree-year cliff vesting for restricted stock units, and a three-year performance period for performance-vested stock. The C&LD Committee also noted that the design of the Performance Stock PlanPSP reduces the likelihood that an executive will focus too much on a single performance measure by including four different performance categories with weightings of 20% or 30% each of which is equally weighted:to provide a balanced risk profile. The categories are organic sales growth, constant currency core before-tax operating profit growth, core earnings per share growth, and free cash flow productivity. In addition, actual performance against goals with respect to each of these performance measures will yield a payout from a minimum of 0% to a maximum of 200% of a senior executive’s target incentive opportunity. Using this sliding scale approach, versus an all-or-nothing approach, discourages participants from taking unnecessary risks. Each of the financial measures areis defined and further explained on page 3134 of this proxy statement.

Finally, the C&LD Committee acknowledged that the Company has adoptedestablished a global compensation and benefits policy review board to authorize any new plans and monitor existing plans as well as maintaining several policies intended to mitigate inappropriate risk taking, including stock ownership guidelines for senior executives, a recoupment policy that can be applied in the event of any significant financial restatement, and an insider trading policy that prohibits margin and hedging transactions by senior executives.

Board Engagement and Attendance

Our Directors are active and engaged. Board agendas are set in advance by the Chairman of the Board and Lead Director, to ensure that appropriate subjects are covered and that there is sufficient time for discussion. Directors are provided with comprehensive materials in advance of Board and Committee meetings and are expected to review these materials before each meeting, to ensure that time in Board and Committee meetings is focused on active discussions versus lengthy presentations. During the fiscal year ended June 30, 2015, the Board held 8 meetings, and the Committees of the Board held 20 meetings, for a total of 28 meetings. Average attendance at these meetings by members of the Board during the past year exceeded 96%, and all Directors attended greater than 76% of the meetings of the Board and the Committees on which they serve. The Board expects all of its members to attend the annual meeting of shareholders; all Directors attended the October 14, 2014 annual meeting.

The non-employee members of the Board met 7 times during FY 2014-15 in executive session (without the presence of Mr. Lafley or other employees of the Company) to discuss various matters related to the oversight of the Company, the management of Board affairs, succession planning for the Company’s top management (including the CEO position), and the CEO’s performance.

Service on Other Public Boards

The Board believes that service on the boards of other public companies provides valuable governance and leadership experience that ultimately benefits the Company. The Board also recognizes that outside public board service requires a significant commitment of time and attention, and therefore, in accordance with best governance practices, limits Director participation on other public boards. Under the Corporate Governance Guidelines, Directors who are active CEOs of other public companies may sit on no more than two additional outside public boards (including his/her own company board), and other non-employee Directors may sit on no more than three additional outside public boards. All Directors are in compliance with this policy.boards; any exception must be approved by the Board. This practice helps ensure that our Directors can give appropriate levels of time and attention to the affairs of the Company. In addition, when nominating a Director for service on the Board, the G&PR Committee considers whether the nominee will have adequate time to serve as a Director of the Company. Each Director demonstrates their strong engagement and high attendance and has adequate time to devote to the affairs of the Company.

Code of Ethics

The Company has a code of ethics for its Directors, officers, and employees. The most recent version of this code of ethics is contained in theWorldwide Business Conduct Manual. TheWorldwide Business Conduct Manual is reviewed each year for appropriate updates, and employees, officers, and Directors are asked to annually certify their understanding of, and compliance with, its requirements. Only the Board may grant a waiver of any provision for a Director or executive officer, and any such waiver, or any amendment to the manual, will be promptly disclosed as

required atwww.pg.com. TheWorldwide Business Conduct Manual, which is firmly rooted in the Company’s long-standing Purpose, Values and Principles, which is made available to employees in 28 different languages and can be found on the Company’s website atwww.pg.com.

Corporate Citizenship

P&G is committed to being a good corporate citizen and doing the right thing. We are and want to be known as a company that is governed responsibly and behaves ethically, that is open and transparent in its business dealings, that supports good causes and protects the environment, and that provides a work environment where our employees are treated well and are given the opportunity to be all they can be. By growing the Company responsibly, we earn the trust on which our business is based, and we build the relationships on which our future depends.

In 2016, we announced our new Citizenship agenda and published our first Citizenship Report. We focus our Citizenship efforts across a number of areas. We start with Ethics & Corporate Responsibility, which is the foundation for the other four: Community Impact, Diversity & Inclusion, Gender Equality, and Environmental Sustainability. You can find more details about each of these interdependent Citizenship areas in our Citizenship Report, which is available at http://us.pg.com/sustainability/at-a-glance/sustainability-reports.

Review and Approval of Transactions with Related Persons

TheWorldwide Business Conduct Manual requires that all employees and Directors disclose all potential conflicts of interest and promptly take actions to eliminate any such conflict when the Company requests. In addition, the Company has adopted a written Related Person Transaction Policy that prohibits any of the Company’s executive officers, Directors, or any of their immediate family members from entering into a transaction with the Company, except in accordance with the policy.

Under our Related Person Transaction Policy, the Chief Legal Officer is charged with primary responsibility for determining whether, based on the facts and circumstances, a related person has a direct or indirect material interest in a proposed or existing transaction. If the Chief Legal Officer determines that the related person would have a direct or indirect material interest in the transaction, the Chief Legal Officer must present the transaction to the Audit Committee for review or, if impracticable under the circumstances, to the Chair of the Audit Committee, who must then either approve or reject the transaction in accordance with the terms of the policy. In the course of making this

determination, the Audit Committee shall consider all relevant information available and, as appropriate, must take into consideration the following:

The Audit Committee may only approve the transaction if it determines that the transaction is not inconsistent with the best interests of the Company as a whole. Further, in approving any such transaction, the Audit Committee has the authority to impose any terms or conditions it deems appropriate on the Company or the related person. Absent this approval, no such transaction may be entered into by the Company with any related person. The Audit Committee has reviewed and approved the following transactions.

Jon R. Moeller, the Company’s Vice Chairman and Chief Financial Officer (“CFO”), is married to Lisa Sauer, a long-tenured employee of the Company who currently holds the position of Vice President, Product Supply, Global Home Products. Her total compensation in the last year was approximately $842,000,$[_____], consisting of salary, bonus, equity grants, and retirement and health benefits. Her compensation is consistent with the Company’s overall compensation principles based on her years of experience, performance, and position within the Company. Prior to Mr. Moeller becoming CFO, the Audit Committee approved the continued employment of Ms. Sauer with the Company under the Company’s Related Person Transaction Policy, concluding that her continued employment was not inconsistent with the best interests of the Company as a whole.

Deborah P. Majoras, the Company’s Chief Legal Officer and Secretary, is married to John M. Majoras, one of approximately 800950 partners in the law firm of Jones Day. The Company has hired Jones Day, in the ordinary course of business, to perform legal services. The Company’s relationship with Jones Day dates back more than 2530 years and

significantly precedes Ms. Majoras joining the Company as Vice President and General Counsel in 2008 from the Federal Trade Commission, where she served as Chairman. Mr. Majoras does not receive any direct compensation from the fees paid to Jones Day by the Company, his ownership in the Jones Day law firm is significantly less than 1%, and the fees paid by the Company to Jones Day in the last fiscal year were significantly less than 1% of their annual revenues. Under the Company’s Related Person Transaction Policy, the Audit Committee reviewed and approved the continued use of Jones Day as a provider of legal services to the Company, but required the Company’s CEO to approve any recommendations by Ms. Majoras to hire Jones Day for a specific legal matter. In doing so, the Committee concluded that the Majorases did not have a direct or indirect material interest in the Company’s hiring of Jones Day and that the relationship is not inconsistent with the best interests of the Company as a whole.

Mark Biegger, the Company’s Chief Human Resources Officer (“CHRO”), has a brother, Brian Biegger, who is employed by the Company. Brian Biegger has been employed by the Company since 1983, well before Mark Biegger’s appointment as CHRO in 2012, and is currently an Associate Director–eBusiness. Brian Biegger’s total annual compensation in the last year, consisting of salary, bonus, equity grants, and retirement benefits was approximately $337,000. His compensation is consistent with the Company’s overall compensation principles based on his years of experience, performance, and positions within the Company. The Committee determined that Brian has a direct material interest in his annual compensation but approved this transaction because it is not inconsistent with the best interests of the Company as a whole, and appropriate controls are in place to avoid any potential conflicts of interest.

W. James McNerney, Jr. the Company’s Lead Director, has a brother, Rick McNerney, who iswas employed by Audience Science, Inc. (“ASI”), a digital media company.company, during the fiscal year ended June 30, 2017. During this time, ASI iswas a Company vendor and also hashad a business partnership and development agreement with the Company. ASI’s contract with the Company expired on June 30, 2017. Rick McNerney was hired by ASI as Director of Enterprise Solutions in December 2014, well after the Company’s relationship with ASI was established. In that role, Rick McNerney willdid not work on P&G business. The Committee determined that Rick, as an employee of ASI, may have an indirect interest in ASI’s relationship with the Company given the size of the Company’s relationship with ASI, but approved the continuation of the Company’s relationship with ASI because it iswas in the best interest of the Company as a whole, and appropriate controls arewere in place to avoid any potential conflicts of interest.

Other than as noted above, there were no transactions, in which the Company or any of its subsidiaries was a participant, the amount involved exceeded $120,000, and any Director, Director nominee, executive officer, or any of

their immediate family members had a direct or indirect material interest reportable under applicable SEC rules or that required approval of the Audit Committee under the Company’s Related Person Transaction Policy, nor are there any currently proposed.

Compensation Committee Interlocks and Insider Participation

All members of the Compensation & Leadership Development Committee during FY 2014-152016-17 were independent directors and none were employees or former employees of the Company. The Company had a Related Person Transaction in connection with Mr. McNerney, as set forth in the preceding section of this proxy statement. There are no Compensation Committee interlocks between the Company and any other entities in which one of our executive officers served on the compensation committee (or equivalent) or the board of directors of another entity whose executive officer(s) served on our C&LD Committee or Board of Directors.

Communication with Directors and Executive Officers

Shareholders and others who wish to communicate with the Board or any particular Director, including the Lead Director, or with any executive officer of the Company, may do so by email atboardofdirectors.im@pg.com or by writing to the following address:

[Name of Director(s)/Executive Officer or “Board of Directors”]

The Procter & Gamble Company

c/o The Corporate Secretary’s Office

One Procter & Gamble Plaza

Cincinnati, OH 45202-3315

All such correspondence is reviewed by the Corporate Secretary’s office, which logs the material for tracking purposes. The Board has asked the Corporate Secretary’s office to forward to the appropriate Director(s) all correspondence, except for personal grievances, items unrelated to the functions of the Board, business solicitations, advertisements, and materials that are profane.

Shareholder Recommendations of Board Nominees and Committee Process for Recommending Board Nominees

The Governance & Public Responsibility Committee will consider shareholder recommendations for candidates for the Board, which should be submitted to:

Chair of the Governance & Public Responsibility Committee

The Procter & Gamble Company

c/o The Corporate Secretary’s Office

One Procter & Gamble Plaza

Cincinnati, OH 45202-3315

The minimum qualifications and preferred specific qualities and skills required for Directors are set forth in Article II, Sections B through E of the Corporate Governance Guidelines. The Committee considers all candidates using these criteria, regardless of the source of the recommendation. The Committee’s process for evaluating candidates also includes the considerations set forth in Article II, Section B of the Committee’s Charter. After initial screening for minimum qualifications, the Committee determines appropriate next steps, including requests for additional information, reference checks, and interviews with potential candidates. In addition to shareholder recommendations, the Committee also relies on recommendations from current Directors, Company personnel, and others. From time to time, the Committee may engage the services of outside search firms to help identify candidates. During the fiscal year ended June 30, 2015, no such engagement existed (and none currently exists), and no funds were paid to outside parties in connection with the identification of nominees. All nominees for election as Directors who currently serve on the Board are known to the Committee and were recommended by the Committee to the Board as Director nominees.

Pursuant to the Company’s Code of Regulations, a shareholder wishing to nominate a candidate for election to the Board at an annual meeting of shareholders is required to give written notice to the Secretary of the Company of his or her intention to make such nomination. The notice of nomination must be received at the Company’s principal executive offices not less than 140 days nor more than 240 days prior to the one-year anniversary of the preceding year’s annual shareholder meeting. Certain other notice periods apply if the date of the annual meeting is more than 30 days before or more than 60 days after such anniversary date. Based on the one-year anniversary of the 2015 annual meeting, a shareholder wishing to nominate a candidate for election to the Board at the 2016 annual meeting must provide such notice no earlier than February 16, 2016, and no later than May 26, 2016.

As set forth in the Company’s Code of Regulations, the notice of nomination is required to contain information about both the nominee and the shareholder making the nomination, including information sufficient to allow the G&PR Committee to determine if the candidate meets certain criteria. A nomination that does not comply with the requirements set forth in the Company’s Code of Regulations will not be considered for presentation at the annual meeting.

Availability of Corporate Governance Documents

In addition to their availability on the Company’s website atwww.pg.com, copies of the Company’s Amended Articles of Incorporation, the Company’s Code of Regulations, all Committee Charters, the Corporate Governance Guidelines (including Independence Guidelines, Confidentiality Policy, and Financial Literacy and Expertise Guidelines), theWorldwide Business Conduct Manual, the Company’s Purpose, Values, and Principles and the Related Person Transaction Policy are available in print upon request by writing to the Corporate Secretary at One Procter & Gamble Plaza, Cincinnati, OH 45202-3315.

The objective of the C&LD Committee is to provide non-employee members of the Board a compensation package consistent with the size-adjusted median of the Peer Group. Directors can elect to receive any part of their fees or retainer (other than the annual grant of Restricted Stock Units (“RSUs”)) as cash, RSUs or unrestricted stock. Consistent with the practice of the past several years, the Company did not grant any stock options to Directors in FY 2014-15. Effective October 14, 2014, non-employee2016-17. Non-employee members of the Board receivereceived the following compensation:

At its June 9, 201513, 2017 meeting, the Board of Directors, upon the recommendation of the C&LD Committee, agreed to maintain the current Director compensation package for the upcoming fiscal year.

Non-employee members of the Board must own Company stock and/or RSUs worth six times their annual cash retainer. A number of the non-employee Directors were appointed or elected to the Board within the last few years. However, all non-employee Directors either meet or are on track to meet the ownership requirements within the five-year period established by the C&LD Committee.

The following table and footnotes provide information regarding the compensation paid to the Company’s non-employee Directors in FY 2014-15.2016-17. Directors who are employees of the Company receive no compensation for their service as Directors.

¹ Director fees are paid quarterly. In the first half of the fiscal year, each Director could elect to take these fees in cash, unrestricted stock, retirement restricted stock or a combination of the three. In the second half of the fiscal year, eachEach director couldmay elect to take these fees in cash, unrestricted stock, RSUs (which vest immediately), or a combination of the three. Restricted stock earns cash dividends that are paid quarterly with the option of reinvesting in Company stock. The RSUs earn dividend equivalents that are subject to the same vesting provision as the underlying RSUs and are accrued

accrued in the form of additional RSUs each quarter and credited to each Director’s holdings. The RSUs are ultimately deliverable in shares. Mr. BlakeMs. Desmond-Hellmann chose not to stand for re-election at the end of her term on October 11, 2016, and her retainer was prorated accordingly. Ms. Chang joined the Board on February 10, 2015June 1, 2017 and histook a pro-rated retainer was prorated accordingly. Hein cash. Mr. Blake elected to take $105,000 of his fees in unrestricted stock, which had a grant date fair value of $42,539.$105,152. Ms. Braly elected to take $55,000 in unrestricted stock, which had a grant date fair value$120,000 of $55,129, and $50,000her fees in RSUs, which had a grant date fair value of $50,041. Mr. Chenault took $52,500 of his fees in retirement restricted stock, which had a grant date fair value of $52,614, and $50,000 in RSUs, which had a grant date fair value of $50,041.$120,072. Mr. Cook tookelected to take $120,000 of his fees in unrestricted stock, which had a grant date fair value of $120,161.$120,072. Mr. LundgrenMcNerney elected to take $55,000 in unrestricted stock, which had a grant date fair value$155,000 of $55,129, and $50,000 in RSUs, which had a grant date fair value of $50,041. Mr. McNerney took his fees in unrestricted stock, which had a grant date fair value of $155,069. Dr. Zedillo took $97,500 of his fees in cash. He also$155,180. Messrs. Chenault and Lundgren elected to take $27,500$105,000 of histheir fees in RSUs, which had a grant date fair value of $27,588.$105,152. The remaining Directors took their fees in cash.

² Each year, upon election at the Company’s annual meeting of shareholders, every Director is awarded a $175,000 grant of RSUs with a grant date fair value of $175,000.RSUs. These RSUs vest after one year as long as the Director remains on the Board. WithMs. Chang did not participate in the exception of Mr. Blake, all Directors have 2,144October 2016 grant. Except for Ms. Chang, each Director has 2,024 RSUs outstanding (representing the grant on October 14, 201411, 2016 and subsequent dividend equivalents). In addition, the following Directors have shares of retirement restricted stock outstanding as of June 30, 2015:2017: Ms. Braly (4,992 shares); Mr. Chenault (5,700 shares); Mr. Cook (9,948 shares); Mr. Lundgren (1,265 shares); and Dr. Zedillo (3,883 shares). Also, Mr. Cook and Dr. Zedillo have 7,790 and 3,760 option awards outstanding, respectively.

³ For all Board meetings throughout the fiscal year, Directors were entitled to bring a guest so long as the Director used the Company aircraft to attend the meeting and the guest’s attendance did not result in any incremental aircraft costs, thoughalthough no Director brought a guest to any Board meeting in FY 2014-15.2016-17. Directors and their guests are also covered under the same insurance policy as all Company employees for accidental death while traveling on Company business (coverage is $750,000 for each Director and $300,000 for a guest)Director). The incremental cost to the Company for this benefit is $2,469.$3,521. Guests of Directors are covered while traveling on corporate aircraft or while traveling in any company limousines to and from the airport. The incremental cost for this benefit is $1,286. In addition, the Company maintains a Charitable Awards Program for current and retired Directors who were participants prior to July 1, 2003. Under this program, at their death, the Company donates $1,000,000 per Director to up to five qualifying charitable organizations selected by each Director. Directors derive no financial benefit from the program because the charitable deductions accrue solely to the Company. The Company funds this contribution from general corporate assets and made one payment duringin FY 2014-15. This program was discontinued for any new Director effective July 1, 2003.2016-17. In FY 2014-15,2016-17, the Company also made a $500 donation on behalf of each Director to the Children’s Safe Drinking Water Program or to a different charity of their choice. These donations were also funded from general corporate assets, and the Directors derive no financial benefit from these donations because the charitable deductions accrue solely to the Company. As an employee Director, Mr. LafleyTaylor did not receive a retainer, fees, or a stock award. Mr. Taylor was appointed to the Board after the end of FY 2014-15 and, as an employee Director, will not receive any compensation for his Board service.

Report of the Compensation & Leadership Development Committee

The Compensation & Leadership Development Committee of the Board of Directors has reviewed and discussed the following section of this proxy statement entitled “Compensation Discussion & Analysis” with management. Based on this review and discussion, the Committee has recommended to the Board that the section entitled “Compensation Discussion & Analysis,” as it appears on the following pages, be included in this proxy statement and incorporated by reference into the Company’s Annual Report on Form 10-K for the fiscal year ended June 30, 2015.[_____]

W. James McNerney, Jr., Chair

Kenneth I. Chenault

Scott D. Cook

Terry J. Lundgren

Margaret C. Whitman

Mary Agnes Wilderotter[DATE], 2017

August 11, 2015

Introduction

The focus of this discussion and analysis is on the Company’s compensation philosophies and programs for its named executive officers (“NEOs”) for FY 2014-15: A.G. Lafley,2016-17: David Taylor, Chairman of the Board, President and Chief Executive Officer; Jon R. Moeller, Chief Financial Officer; Giovanni Ciserani, Group President–President—Global Fabric and Home Care; Martin Riant, Group President–Care and Global Baby and Feminine Care, Mary Lynn Ferguson-McHugh, Group President—Global Family Care and Family Care;P&G Ventures; and David Taylor,Steven D. Bishop, Group President–President—Global Beauty, Grooming and Health Care. Mr. Taylor has been appointed President and Chief Executive Officer of the Company effective NovemberEffective July 1, 2015; the compensation described herein is for his role as Group President in FY 2014-15.

Executive Summary

Our fundamental business objective is to create value for shareholders at leadership levels, on a consistent long-term basis. Our primary compensation principle, Pay for Performance, supports this objective. We align the compensation for our senior executives with the delivery of balanced, consistent, and sustainable growth and value creation.

We use a combination of three programs that incent executives to achieve results in a balanced way over the short-, medium-, and long-term.

The portion of compensation tied to each of these programs is balanced proportionately with the business goals we are trying to achieve, so that our executives remain focused on the right business priorities. In total, about 74% of NEO compensation is tied to Company performance via these programs. The remainder, about 26%, is in base salary, retirement, expatriate allowances, and other benefits. This allocation ensures that executives make decisions that are appropriately focused on the long-term health and success of the Company.

¹ The STAR Bonus is considered a cash program. However, participants may elect to receive their bonus in stock options or deferred compensation instead of cash.

We are disciplined in implementing this compensation strategy as evidenced by our track record over many years. While we strive to deliver or over-deliver our targets each year, if results fall short of our goals, this is reflected in the compensation paid. For example, in the last 15 years, the average STAR payout has been below target 40% of the time, which reflected the business results versus our goals in those years. The strength of our pay-for-performance alignment is also evidenced by the payouts under our PSP program. Since the program’s inception in 2010, PSP has delivered shares at an average of 27% of target. This average is consistent with the below-target business results for this same period.

In addition to the discipline we exercise in the design and execution of compensation programs that are tightly aligned to business results, our executives exhibit strong ownership behavior, which is indicative of the culture of ownership at the Company. Our executives are required to own shares valued at a minimum of four to eight times their salary. Each of our NEOs exceeds these requirements. We are proud of this ownership behavior and believe it further aligns the interest of our executives with the long-term interests of our shareholders. Our shareholders typically do not invest in our stock looking for only a short-term gain, but are looking for longer-term returns. The majority of our investors hold our stock for long periods, and investors in consumer goods have a tendency to hold longer than in other industries. Again, our fundamental business objective is to create value for shareholders, at leadership levels, on a consistent long-term basis.

Company Results

The Company’s focus for FY 2014-15 was on the execution of four key strategic priorities: strengthen and simplify the portfolio, tighten strategies and business models, improve product innovation, and drive cost savings and productivity improvements.

¹ The targets above reflect the original FY 2014-15 financial guidance provided by the Company on August 1, 2014. This guidance was subsequently revised during the fiscal year, primarily due to extraordinarily high impacts from foreign exchange rates; however, as further detailed on page 28, the original guidance numbers were used to establish the STAR targets for the Company Performance Factor.

² Please see Exhibit A for a reconciliation of non-GAAP measures, including Organic Sales Growth, Core EPS Growth, and Adjusted Free Cash Flow Productivity.

Organic Sales Growth was 1%. This was at the low end of the original target range primarily due to trade inventory corrections in China, continued challenges in the Beauty business, and soft market shares in some country category combinations. Core earnings per share (“EPS”) Growth was below target at -2% primarily due to the negative impact of foreign exchange (-13% or -$1.5 billion), the largest foreign exchange impact in Company history.

The Company took two important steps to address the foreign exchange challenges. First, where feasible, the Company increased prices. Second, the Company accelerated work on savings across all elements of cost: cost of goods sold, non-manufacturing overhead, and marketing. The Company delivered $1.5 billion in cost of goods savings, spanning materials, manufacturing, and logistics. This savings exceeded the target annual run rate by $300 million.

The Company continued to accelerate overhead reduction. In February 2012, we announced a targeted 10% reduction of non-manufacturing enrollment by June 2016. As of June 30, 2015, we reduced roles by 21%, more than double the original objective, one year sooner.

Adjusted Free Cash Flow Productivity was 102%, ahead of target. These cash results enabled a 3% increase in the quarterly dividend and $4.6 billion in share repurchase. For the fiscal year, the Company effectively returned nearly $12 billion to shareholders.

Including the Company’s previously announced agreement to merge 43 Beauty brands with Coty, Inc., the Company has substantially completed plans for the strategic portfolio reshaping announced in August 2014. By the close of the Coty transaction, which is expected to occur in the second half of 2016, the Company will have focused our portfolio on 10 categories and 65 brands (from 16 categories and 165 brands).

CEO Compensation for FY 2014-15

The Chief Executive Officer’s compensation is determined by2017, the C&LD Committee with objective input from the C&LD Committee’s independent compensation consultant, Frederic W. Cook & Co. The C&LD Committee reviewsappointed Mr. Moeller as Vice Chair and considers the following when making compensation decisions for the Chief Executive Officer:Financial Officer.

Mr. Lafley’s FY 2014-152016-17 Results—Key Compensation HighlightsMeasures

The C&LD Committee set Mr. Lafley’s compensation for FY 2014-15 at the same level as in FY 2013-14. The C&LD Committee believed this compensation package was still appropriate considering the total compensation opportunity for chief executive officers in the Peer Group.[TO BE ADDED WHEN AVAILABLE]

Executive Compensation Practices

Our executive compensation practices support good governance and mitigate excessive risk-taking.

What We Do Not Do:
		No employment contracts with executives containing special severance payments such as golden parachutes.
		No special executive retirement programs and no severance programs that are specific to executive officers.
		No gross-up payments to cover personal income taxes or excise taxes that pertain to executive or severance benefits.
		No excessive perquisites for executives.
		No hedging or engaging in the following transactions that include shares of Common Stock: pledging, collars, short sales, and other derivative transactions.
		No re-pricing or backdating stock options.

Say on Pay Advisory Vote Outcome

In October 2014, shareholders approved the Company’s Say on Pay proposal, with 95.39% of votes cast in favor of the compensation paid to the NEOs. The Company considers this vote a positive endorsement of its executive compensation practices and decisions. The shareholders’ overwhelming support of the Company’s executive compensation program is one factor that contributed to the C&LD Committee’s decision not to make significant changes to the Company’s current executive compensation programs, principles, and policies. In addition, the Company routinely engages with investors to understand their issues and perspectives on the Company, including executive compensation practices. The C&LD Committee will continue to consider results from the annual shareholder advisory votes, including the next vote on October 13, 2015, as well as other shareholder input, when reviewing executive compensation programs, principles, and policies.

We design compensation programs to motivate executives to achieve the Company’s fundamental and overriding objective – to create value for our shareholders at leadership levels on a consistent long-term basis. As such, we encourage shareholders to support the Company’s advisory Say on Pay resolution, which can be found on page 55 of this proxy statement.

End of Executive Summary

Our Compensation Objectives

Our fundamental and overriding objective is to create value for our shareholders at leadership levels on a consistent long-term basis. To accomplish this goal, the C&LD Committee designs executive compensation programs that:

Emphasizing Pay for Performance

Our executive compensation program consists of four key components: salary, STAR,the Short-Term Achievement Reward (STAR), and two long-term incentive equity programs – PSPprograms—the Performance Stock Program (PSP) and the Long-Term Incentive Program (LTIP) (formerly known as the Key Manager Stock Grant.Grant). For FY 2014-152016-17, these four components constituted approximately 86%[_____]% on average of each NEO’s total compensation. The remaining 14%[_____]% consisted of retirement income, expatriate expenses, and other benefits.

We design our programs so that NEO compensation varies by type (fixed versus performance-based), length of performance period (short-term versus long-term), and form (cash versus equity). We believe that such variation is necessary to: (1) strike the appropriate balance between short- and long-term business goals; (2) encourage appropriate behaviors and discourage excessive risk-taking; and (3) align the interests of the Company’s executives with our shareholders.

While salary is considered fixed, salary progression over time is based on individual performance.performance and the scope of responsibilities of the role. The remaining compensation components vary based on the performance of the individual, the performance of the individual’s business unit, and the performance of the Company as a whole. This mix of components is designed to incent both individual accountability and collaboration to build long-term shareholder value. The charts below show the average mix of the four key components of FY 2014-152016-17 NEO compensation by type, length, and form.

Consistent with our design principles, performance-based programs pay out at 100% when target goals are achieved. Payouts below 100% occur when target goals are not achieved, and payouts above 100% are possible when target goals are exceeded. For example, over the previous 10 years, the average STAR payout for NEOs ranged from a low of 67% of target to a high of 145% of target, and the Company’s long-term performance program payout ranged from a low of 20% of target to a high of 120% of target. These payouts were based on the results achieved as compared to the pre-established performance targets, highlighting the clear link between pay and performance that underlies our compensation programs.

Paying Competitively

The C&LD Committee structures executive compensation so that total targeted annual cash and long-term compensation opportunities are competitive with the targets for comparable positions at 25 companies considered to be our peers (“Peer Group”), based on criteria described below (“Peer Group”).below. The C&LD Committee sets targets for each element of compensation considering the same elements of compensation paid to those holding similar jobs at companies in our Peer Group, focusing on positions with similar management and revenue responsibility. The C&LD Committee makes appropriate adjustments for differences in revenue size within the Peer Group. For the CEO’s compensation analysis, the C&LD Committee considers the Company’s revenue, and market capitalization, and relative performance compared to our Peer Group.

The Peer Group is objectively determined and consists of global companies that generally meet the following criteria:

§     Peer Group revenues range from $16 billion to $480 billion with a median of $67 billion; and

Each year, the C&LD Committee evaluates and, if appropriate, updates the composition of the Peer Group. Changes to the Peer Group are carefully considered and made infrequently to assure continuity from year to year. For FY 2014-15, there were no changes. The2016-17, the Committee did not make any changes to the Peer Group currentlywhich consists of the following companies:

While the target total compensation for our NEOs is set considering the size-adjusted median target total compensation within our Peer Group, actual compensation varies depending on the NEO’s experience in the particular role, as well as on total Company, business unit, and individual performance. Consistent with our principles to pay for performance and pay competitively, substantial differences may exist among NEOs’ pay.

Focus on Long-Term Success

To reinforce the importance of stock ownership and long-term focus for our most senior executives, including the NEOs, the C&LD Committee established the Executive Share Ownership Program and Stock Option ExerciseEquity Holding Requirement.

The Executive Share Ownership Program requires the CEO to own shares of Company stock and/or RSUs (including granted Performance Stock Units (“PSUs”)) valued at a minimum of eight times salary. Mr. LafleyTaylor currently holds approximately 30[_____] times salary. All other NEOs must own stock and/or RSUs (including granted PSUs) valued at a minimum of four or five times salary, depending on the NEO’s role. The C&LD Committee annually reviews these holdings, and in 20152017 each NEO exceeded these requirements.

The Stock Option ExerciseEquity Holding Requirement ensures executives remain focused on sustained shareholder value even after exercising their stock options.options or receiving shares from RSU settlements or PSU payouts. The equity holding requirement applies when an executive, including an NEO, has not met the ownership requirements of the Executive Share Ownership Program. When the holding requirement applies, the CEO is required to hold the net shares received from

stock option exercises and RSU and PSU settlements for at least twothree years, and the other NEOs are required to hold net shares received from option exercises for at least one year. The holding requirement does not apply to incentive planunrestricted stock or to STAR awards that executives elect to take as stock options instead of cash or unrestricted stock.cash.

Elements of Our Compensation Programs

Annual Cash Compensation

The Company’s annual cash compensation consists of salary and STAR. We collect and analyze data from the Peer Group on the total annual cash compensation opportunity (salary plus annual bonus target) for positions comparable to those at the Company. We consider the target median annual cash compensation opportunity for each position within our peer group,Peer Group, adjusted for size using a regression analysis of Peer Group revenues, to set a salary range mid-point and a target for STAR, as a percentage of salary (“STAR Target”target”).

Salary

Mr. Lafley’sTaylor’s annualized salary remained unchanged at $2,000,000 for$1,600,000 during FY 2014-15.2016-17. The salary for Mr. Moeller also remained unchanged at $850,000.$950,000. The C&LD Committee approved a 6.5% increase to bring Mr. Taylor’s salary to $980,000, recognizing his strong contributions and increased responsibility during the fiscal year for the Beauty business. The C&LD Committee also approved a 4.3% increase to bring Mr. Riant’s salary to $960,000 and a 5.3%5.9% increase to bring Mr. Ciserani’s salary to $800,000, each$900,000 based on the competitive market and to recognize his contributions managing a significant portion of the total Company businesses. The Committee also approved a 3.7% increase to bring Mr. Bishop’s salary to $840,000 and a 3.8% increase to bring Ms. Ferguson-McHugh’s salary to $820,000. These adjustments were made in recognition of their continued contributions to the base businessindividual performance and their support of simplification of the business portfolio.market adjustments.

STAR Annual Bonus

The STAR program links a substantial portion of each NEO’s annual cash compensation to the Company’s performance for the fiscal year. The program focuses on the achievement of business unit results, but also includes a component that measures the performance of the Company as a whole.overall Company. STAR awards are generally paid in cash, but executives can also elect to receive all or part of their awards in stock options or deferred compensation.

STAR awards are calculated using the following formula:

The basis for each element of STAR is:

The Business Unit Performance Factor for NEOs who lead sectorsmultiple business units is based on a combination, as determined by the STAR Committee, of the results of the business units for which the NEO is ultimately responsible. There are no separate performance goals for the sectorsbusiness unit combinations for purposes of compensation.

While the formula described above is used to calculate potential STAR awards, the C&LD Committee retains the authority to make no STAR award in a given year and the discretion to accept, modify, or reject management’s recommendations for any or all employees, including the NEOs.

FY 2014-152016-17 STAR Annual Bonus

Mr. Lafley’sTaylor’s STAR Targettarget remained at 250%200% of salary for FY 2014-15.salary. The STAR Targetstargets for the other NEOs remained atMessrs. Moeller and Ciserani are 120% of salary. The targets for Mr. Bishop and Ms. Ferguson-McHugh are 100% of salary.

At the beginning of FY 2014-15,2016-17, the C&LD Committee established the Organic Sales Growth target at 2% and the Core EPS Growth targets of 3% andtarget at 5%, respectively, to be used to compute the FY 2014-152016-17 Company Performance Factor, and established a payout matrix that would generate a Company Performance Factor between 70% and 130% depending on the actual Organic Sales and Core EPS Growth achieved. Both Organic Sales Growth and Core EPS Growth were below target at 1% and -2%[_____], respectively, resulting in a Total Company Performance Factor of 70%[_____]%.

The Committee also established FY 2016-17 goals for the Transformation Factor. Because [_____] the Transformation Factor was established at [_____]%.

The C&LD Committee then reviewed the recommendations provided for the 21 different18 Business Unit Performance Factors and, after considering the performance of the total Company, the Transformation Factor, and the appropriate combination of Business Unit Performance Factors for each NEO, approved the following STAR awards: