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 (Amendment No. )
Filed by the Registrant ☒ Filed by a Party other than the Registrant ☐
Check the appropriate box:
Filed by the Registrant | Filed by a Party other than the Registrant |
Check the appropriate box: | ||
Preliminary Proxy Statement | ||
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | ||
Definitive Proxy Statement | ||
Definitive Additional Materials | ||
Soliciting Material Pursuant to § 240.14a-12 |
DANAHER CORPORATION
(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):
Payment of Filing Fee (Check the appropriate box): | ||||||
No fee required. | ||||||
Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11. | ||||||
(1) | ||||||
Title of each class of securities to which transaction applies: | ||||||
(2) | Aggregate number of securities to which transaction applies: | |||||
(3) | Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 | |||||
(4) | Proposed maximum aggregate value of transaction: | |||||
(5) | Total fee paid: | |||||
Fee paid previously with preliminary materials. | ||||||
Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing. | ||||||
(1) Amount Previously Paid: | ||||||
(2) Form, Schedule or Registration Statement No.: | ||||||
(3) Filing Party: | ||||||
|
|
NOTICE
OF 2021 ANNUAL MEETING OF SHAREHOLDERS
DANAHER 2018 PROXY STATEMENT
DANAHER CORPORATION
2200 Pennsylvania Avenue, N.W., Suite 800W
Washington, D.C. 20037-1701
March 28, 2018ITEMS OF BUSINESS
1. | ||
| ||
| ||
|
| |
2. | To ratify the selection of Ernst & Young LLP as Danaher’s independent registered public accounting firm for the year ending December 31, 2021. | |
3. | To approve on an advisory basis the Company’s named executive officer compensation. | |
4. | To act upon a shareholder proposal requesting that Danaher amend its governing documents to reduce the percentage of shares required for shareholders to call a special meeting of shareholders from 25% to 10%. | |
5. | To consider and act upon such other business as may properly come before the meeting or at any postponement or adjournment thereof. | |
| ||
| ||
|
WHO CAN VOTE
Shareholders of Danaher Common Stock at the close of business on March 8, 2021. YOUR VOTE IS IMPORTANT. PLEASE SUBMIT YOUR PROXY OR VOTING INSTRUCTIONS AT YOUR EARLIEST CONVENIENCE, WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING.
A list of shareholders of record will be available during the meeting for inspection by shareholders of record for any legally valid purpose related to the annual meeting at the meeting center site at www.virtualshareholdermeeting.com/DHR2021.
DATE OF MAILING
We intend to mail the Notice Regarding the Availability of Proxy Materials (“Notice of Internet Availability”), or the Proxy Statement and proxy card as applicable, to our shareholders on or about March 25, 2021.
By order of the Board of Directors,
JAMES F. O’REILLY
Vice President, AssociateDeputy General Counsel and Secretary
Review Your Proxy Statement and Vote in One of the Following Ways:
MAY 5, 2021
ATTENDING THE MEETING To attend the virtual meeting, you will need to enter the 16-digit control number included on your proxy card, Notice of Internet Availability of Proxy Materials or voting instruction form. 2021 PROXY STATEMENTII
IMPORTANT NOTICERegarding the Availability of Proxy Materials for the Shareholder Meeting to be held on May To assist you in reviewing the proposals to be acted upon at our
Voting Matters
|
|
Please see the sections titled “General Information About the Meeting” and “Other Information” beginning on page 5680 for important information about the proxy materials, voting, the Annual Meeting, Company documents, communications and the deadlines to submit shareholder proposals and director nominations for next year’s annual meeting of shareholders.
2021 PROXY STATEMENT04
Business Highlights
2020 Performance
COVID-19 RESPONSE |
The COVID-19 pandemic posed an unprecedented challenge to our business in 2020, and in response we have focused on the health and well-being of our associates, mitigating disruptions to our businesses and deploying the full breadth of our portfolio in the fight against the virus:
Developed and Implemented a Pandemic Response Plan |
To mitigate disruptions to our business, we developed and implemented a Pandemic Response Plan which builds upon our businesses’ existing business continuity plans. The Pandemic Response Plan leverages CDC and WHO guidance to establish a flexible framework within which our operating companies have the discretion to act according to local needs, regulatory guidance and requirements, while mandating certain Company-wide policies where appropriate. |
Provided Crucial Support in the Fight Against COVID-19 |
Danaher’s businesses have stepped up to provide crucial support in the fight against COVID-19: |
• | As of March 1, 2021, our businesses have collectively enabled or produced approximately 100 million COVID-19-related diagnostic tests. |
• | Healthcare providers are using Beckman Coulter’s antibody serology test to diagnose COVID-19 immune status, supporting both individual health decisions as well as population-based immunity monitoring. |
• | Radiometer’s point-of-care blood gas analyzers have been critical tools for emergency rooms dealing with surges of infected patients. |
• | Pall’s and Cytiva’s bioprocessing products are being used in a significant number of the COVID-19 related vaccine and therapeutic projects underway globally as of March 1, 2021. |
We launched a global Employee Assistance Program in March 2020 to ensure a consistent support structure for mental health and well-being across the Company and expanded the program over the course of 2020 to provide enhanced support with respect to childcare, eldercare and tutoring, among other areas. In the U.S., we have provided benefits beyond the requirements of the Families First Act, for example by extending our leave policy to cover elder care and providing for voluntary leaves even in certain circumstances not required by the law. We have implemented safety precautions on a facility-specific basis, such as work-from-home requirements where feasible and in many cases staggered work shifts, restricted work zones and daily temperature screenings. The results of our 2020 Associate Engagement Survey validate the impact of these efforts: 88% of surveyed associates felt satisfied with Danaher’s efforts to care for associates during the pandemic, while 93% of surveyed associates agreed that their leaders took actions to maintain a safe work environment. |
BUSINESS PERFORMANCE |
Business Highlights
2017 Performance
In 2017,Notwithstanding the pandemic, in 2020 Danaher:
• | continued to invest in future growth, investing | division) from GE for a cash purchase price of approximately $20.7 billion; |
• |
returned |
• | grew our business on a year-over-year | basis as illustrated below: |
DANAHER 2016-2017 YEAR-OVER-YEAR GROWTH FROM CONTINUING OPERATIONS
2021 PROXY STATEMENT05
Long-Term Performance
We believe a long-term performance period most accurately compares relative performance within our peer group. Over shorter periods, performance comparisons may be skewed by the easier performance baselines of peer companies that have experienced periods of underperformance.
8.5% REVENUE GROWTH 14.5% EARNINGS GROWTH 12.5% OPERATING CASH FLOW GROWTHDanaher has not experienced a sustained period of underperformance over the last twenty-five years (i.e., 1996-2020). We believe the consistency of our performance over that period is unmatched within our peer group. Danaher ranks number one in its peer group over the past twenty-five years based on compounded average annual shareholder return, and is the only company in its peer group whose total shareholder return (“TSR”) outperformed the S&P 500 Index:
Long-Term Performance
|
• | over every rolling3-year period from and including |
• | by more than 600 basis points over every rolling3-year period from and including | 2001-2020. |
Danaher’s compounded average annual shareholder return has outperformed the S&P 500 Index over each of the last one, two, three, five-,ten-, fifteen-, twenty- and twenty-five year periods:
2021 PROXY STATEMENT06
#1 IN PEER GROUP based on compounded average annual shareholder return from and including 1993-2017 13.4% 3 years S&P 500: 11.4% 17.6% 5 years S&P 500: 15.8% 11.2% 10 years S&P 500: 8.5% 14.7% 15 years S&P 500: 9.9% 15.0% 20 years S&P 500: 7.2%19.2% 25 years S&P 500: 9.7%
Corporate Governance Highlights
Our Board of Directors recognizes that Danaher’s success over the long-term requires a robust framework of corporate governance that serves the best interests of all our shareholders. Below are highlights of our corporate governance framework.
☑ Board refreshment remains a key area of focus for us, as evidenced by the recent addition of Raymond C. Stevens, Ph.D.
Board refreshment remains a key area of focus for us, as evidenced by the 2019 additions of Drs. Jessica L. Mega and Pardis C. Sabeti and 2020 addition of Rainer M. Blair to our Board. To further build on the enhanced gender, age and national origin diversity from these appointments, Danaher has formally initiated a director search specifically focused on adding to the Board a Person of Color from an underrepresented community. | |
Our Bylaws provide for proxy access by shareholders. | |
Our Chairman and CEO positions are separate. | |
Our Board has established a Lead Independent Director position. | |
All of our directors are elected annually. | |
In uncontested elections, our directors must be elected by a majority of the votes cast, and we have a director resignation policy that applies to any incumbent director who fails to receive such a majority. | |
Our shareholders have the right to act by written consent. | |
Shareholders owning 25% or more of our outstanding shares may call a special meeting of shareholders. | |
We have never had a shareholder rights plan. | |
We have no supermajority voting requirements in our Certificate of Incorporation or Bylaws. | |
All members of our Audit, Compensation and Nominating and Governance Committees are independent as defined by the New York Stock Exchange listing standards and applicable SEC rules. | |
Danaher (including its subsidiaries during the period we have owned them) has made no political contributions since at least 2012, has no intention of contributing any Danaher funds for political purposes and discloses its political expenditures policy on its public website. The 2020 CPA-Zicklin Index of Corporate Political Disclosure and Accountability ranked Danaher as a First Tier company. |
2021 PROXY STATEMENT☑07 Our Bylaws provide for proxy access by shareholders.
☑ Our Chairman and CEO positions are separate.
☑ Our Board has established a Lead Independent Director position.
☑ All of our directors are elected annually.
☑ In uncontested elections, our directors must be elected by a majority of the votes cast, and an incumbent director who fails to receive such a majority automatically tenders his or her resignation
☑ Our shareholders have the right to act by written consent.
☑ Shareholders owning 25% or more of our outstanding shares may call a special meeting of shareholders.
☑ We have never had a shareholder rights plan.
☑ We have no supermajority voting requirements in our Certificate of Incorporation or Bylaws.
☑ All members of our Audit, Compensation and Nominating and Governance Committees are independent as defined by the New York Stock Exchange listing standards and applicable SEC rules.
☑ Danaher (including its subsidiaries during the period we have owned them) has made no political contributions since at least 2012 and has no intention of contributing any Danaher funds or assets for political purposes, and we disclose our political expenditures policy on our public website.
Shareholder Engagement Program
We actively seek and highly value feedback from our shareholders. During 2017,2020, in addition to our traditional Investor Relations outreach efforts, we engaged with shareholders representing approximately 25% of our outstanding shares on topics including our business strategy and financial performance, governance and executive compensation programs and sustainability initiatives. FeedbackWe shared feedback received during these meetings was shared with our Nominating &and Governance Committee and Compensation Committee, informing their decision-making.
Board of Directors
Below is an overview of each of the director nominees you are being asked to elect at the 20182021 Annual Meeting.
NAME | DIRECTOR SINCE | PRINCIPAL PROFESSIONAL EXPERIENCE | COMMITTEE MEMBERSHIPS |
OTHER BOARDS | ||||||||
Donald J. Ehrlich* Lead Independent Director | 1985 | Former President and CEO, Schwab Corp. | A, C (Chair) | 0 | ||||||||
Linda Hefner Filler* | 2005 | Former President of Retail Products and Chief Merchandising Officer, Walgreen Co. | N (Chair) | 0 | ||||||||
Thomas P. Joyce, Jr. | 2014 | President and Chief Executive Officer, Danaher Corporation | F, E | 0 | ||||||||
Teri List-Stoll* | 2011 | Executive Vice President and Chief Financial Officer, Gap Inc. | A | 1 | ||||||||
Walter G. Lohr, Jr.* | 1983 | Retired partner, Hogan Lovells | C, F, N | 0 | ||||||||
Mitchell P. Rales | 1983 | Chairman of the Executive Committee, Danaher Corporation | F (Chair), E (Chair) | 2 | ||||||||
Steven M. Rales | 1983 | Chairman of the Board, Danaher Corporation | F, E | 1 | ||||||||
John T. Schwieters* | 2003 | Principal, PerseusTDC | A (Chair), N | 0 | ||||||||
Alan G. Spoon* | 1999 | Partner Emeritus, Polaris Partners | C | 4 | ||||||||
Raymond C. Stevens, Ph.D.* | 2017 | Provost Professor of Biological Sciences and Chemistry, and Director of The Bridge Institute, at the University of Southern California | — | 0 | ||||||||
Elias A. Zerhouni, M.D.* | 2009 | President, Global Research & Development, Sanofi S.A. | N | 0 |
Name | Director Since | Principal Professional Experience | Committee Memberships | Other Public Company Boards | ||||
Rainer M. Blair | 2020 | President and Chief Executive Officer, Danaher Corporation | E, F, S | 0 | ||||
Linda Hefner Filler* | 2005 | Former President of Retail Products, Chief Marketing Officer and Chief Merchandising Officer, Walgreen Co. | N, S | 0 | ||||
Teri List* | 2011 | Former Executive Vice President and Chief Financial Officer, Gap Inc. | A, C | 2 | ||||
Walter G. Lohr, Jr.* | 1983 | Retired partner, Hogan Lovells | A, C, F, N | 0 | ||||
Jessica L. Mega, MD, MPH* | 2019 | Chief Medical and Scientific Officer, Verily Life Sciences LLC | S | 0 | ||||
Mitchell P. Rales | 1983 | Chairman of the Executive Committee, Danaher Corporation | E, F | 2 | ||||
Steven M. Rales | 1983 | Chairman of the Board, Danaher Corporation | E, F, S | 1 | ||||
Pardis C. Sabeti, MD, D.Phil* | 2019 | Investigator, Howard Hughes Medical Institute | S | 0 | ||||
John T. Schwieters* | 2003 | Principal, Perseus TDC | A, N | 0 | ||||
Alan G. Spoon* | 1999 | Former Managing General Partner, Polaris Partners | C | 3 | ||||
Raymond C. Stevens, PhD* | 2017 | Provost Professor of Biological Sciences and Chemistry, and Director of The Bridge Institute, at the University of Southern California; Chief Executive Officer, ShouTi | S | 0 | ||||
Elias A. Zerhouni, MD* | 2009 | Former President, Global Research & Development, Sanofi S.A. | N, S | 0 |
Chair * Independent Director
A = Audit Committee C = Compensation Committee E = Executive Committee F = Finance Committee N = Nominating & Governance Committee S = Science & Technology Committee
2021 PROXY STATEMENT08
Sustainability
Danaher’s sustainability program is distinctive in that we drive company-wide sustainability initiatives where it makes sense to harness Danaher’s scale, while leveraging our decentralized operating structure to empower our operating companies to pursue sustainability in ways that best fit the needs of their particular stakeholders. Based on a materiality assessment we conducted that identified the intersection of Danaher’s key strategic and sustainability goals, our sustainability program is structured around three pillars: innovation, people and the environment. These three pillars are underpinned by a foundation of integrity, compliance and sound governance.
At the heart of our sustainability efforts is innovation with purpose. In the spirit of one of our five Core Values, “Innovation Defines Our Future”, our teams work to expand access to healthcare in underserved areas, improve safety and protect precious natural resources. Danaher invested $1.3 billion in research and development in 2020 and as of the end of 2020 held approximately 11,800 patents worldwide, underscoring our commitment to innovation. | |
People | |
Danaher is committed to attracting, developing, engaging and retaining the best people from around the world to sustain and grow our science and technology leadership. “Consistently attracting and retaining exceptional talent” is one of our three strategic priorities and “The Best Team Wins” is one of our Core Values, reflecting the critical role our human capital plays in supporting our strategy. Our human capital strategy addresses culture, recruitment, development, engagement and retention, with a particular focus on attracting and engaging diverse talent with the unique perspectives and fresh ideas necessary to drive innovation, fuel growth and help ensure our technologies and products effectively serve a global customer base. For more detail on our human capital strategy, please see pages 9-11 of our Annual Report on Form 10-K for the year ended December 31, 2020. |
In 2020, Danaher publicly reported for the first time on our global gender diversity overall and at the managerial level, as well as our U.S. People of Color (“POC”) diversity overall and at the managerial level. We also announced our goal to achieve 40% global gender diversity and 35% U.S. POC diversity by 2025. | ||
Third parties have recognized our human capital initiatives, as Danaher was featured on the FORTUNE World’s Most Admired Companies 2020, Forbes World’s Best Employers 2020, Forbes Best Employers 2020 for New Grads and Forbes 2020 Best Employers for Diversity lists and in 2020 for the seventh year in a row the Human Rights Campaign named Danaher one of the Best Places to Work for LGBTQ Equality. |
2021 PROXY STATEMENT09
Environment | ||||
We are committed to reducing the environmental impact of our operations and products, and helping our customers do the same. We continue to make progress toward this objective by implementing management programs to support our efforts, tracking key metrics to gauge improvement and setting goals to drive accountability. In particular: | ||||
• | Beginning in 2019, we began leveraging the power of the Danaher Business System (“DBS”) to mitigate the environmental impact of our operations by deploying our first DBS environmental sustainability tools, focused on reducing energy use and waste. | |||
• | In 2019, we reported for the first time metrics relating to energy usage, greenhouse gas emissions, water usage, waste generation and recycling. | |||
• | In 2020, we announced our intention to achieve the following goals by 2024 (compared to the baseline year of 2019): | |||
YEAR 2024 GOAL | YEAR 2024 GOAL | YEAR 2024 GOAL | ||
15% | 15% | 15% | ||
REDUCTION IN ENERGY CONSUMED
(normalized to annual revenue)
| REDUCTION IN SCOPE 1/2 GREENHOUSE GAS (GHG) EMISSIONS
(normalized to annual revenue)
| REDUCTION IN PERCENTAGE OF NON-HAZARDOUS/NON-REGULATED WASTE SENT TO LANDFILLS OR INCINERATION | ||
• | In 2020, we reported for the first time on the key climate-related risks and opportunities our businesses face. |
At the Board level, Danaher’s Nominating and Governance Committee oversees sustainability and social responsibility, and this responsibility is set forth in the committee’s charter. At the management level, Danaher’s Senior Vice President and General Counsel, who reports directly to our CEO, has general oversight responsibility with respect to matters of sustainability and social responsibility, and is responsible for reviewing and approving Danaher’s sustainability reports. |
More information about Danaher’s sustainability efforts is included in our latest Sustainability Report, available in the Investors section of our public website, https://www.danaher.com. |
Executive Compensation Highlights
Overview of Executive Compensation Program
As discussed in detail under “Compensation Discussion and Analysis,” with the goal of building long-term value for our shareholders, we have developed an executive compensation program designed to:
• | attract and retain executives with the leadership skills, attributes and experience necessary to succeed in an enterprise with Danaher’s size, diversity and global footprint; |
• | motivate executives to demonstrate exceptional personal performance and perform consistently at or above the levels that we expect, over the long-term and through a range of economic cycles; and |
• | link compensation to the achievement of corporate goals that we believe best correlate with the creation of long-term shareholder value. |
To achieve these objectives our compensation program combines annual and long-term components, cash and equity, and fixed and variable elements, with a bias toward performance-based long-term equity awards tied closely to shareholder returns and subject to significant vesting and/or holding periods. Our executive compensation program rewards our executive officers when they buildhelp increase long-term shareholder value, achieve annual business goals and maintainbuild long-term careers with Danaher.
2021 PROXY STATEMENT10
Compensation Governance
Our Compensation Committee also recognizes that the success of our executive compensation program over the long-term requires a robust framework of compensation governance. As a result, the Committee regularly reviews external executive compensation practices and trends and incorporates best practices into our executive compensation program:
WHAT WE DO |
| WHAT WE DON’T DO | |||||||||||||
Five-year vesting requirement for | No taxgross-up provisions | ||||||||||||||
Incentive compensation programs feature multiple, differentperformance measures aligned with | No dividend/dividend equivalents paid on unvestedequity awards | ||||||||||||||
Short-term and long-term performance metrics that balance ourabsolute performance and our relative performance versuspeer companies | No “single trigger” change of control benefits | ||||||||||||||
Rigorous, no-fault clawback policy that is triggered even in the absence of wrongdoing | No | active defined benefit pension program since 2003 | |||||||||||||
Minimumone-year vesting requirement for 95% of shares granted under the Company’s stock plan | No | hedging of Danaher securities permitted | |||||||||||||
Stock ownership requirements for all executive officers | No | long-term incentive compensation is denominated orpaid in cash (other than PSU dividend accruals) | |||||||||||||
Limited perquisites and a cap on CEO/CFO personal aircraft usage | No | plans | |||||||||||||
Independent compensation consultant that performs no other services for the Company | No | programs |
2021 PROXY STATEMENT11
Named Executive Officers 20172020 Compensation
The following table sets forth the 20172020 compensation of our named executive officers. Please see pages 36-3853-55 for information regarding 20162019 and 20152018 compensation, as well as footnotes.
NAME AND PRINCIPAL POSITION | SALARY | BONUS | STOCK AWARDS | OPTION AWARDS | NON-EQUITY PLAN | CHANGE IN PENSION | ALL OTHER COMPENSATION | TOTAL | ||||||||||||||||||||||||||||
Thomas P. Joyce, Jr., President and CEO | $ | 1,200,000 | 0 | $ | 5,559,897 | $ | 4,413,654 | $ | 3,100,000 | $ | 6,863 | $ | 505,927 | $ | 14,786,341 | |||||||||||||||||||||
Daniel L. Comas, Executive Vice President and CFO | $ | 905,476 | 0 | $ | 2,168,648 | $ | 1,721,412 | $ | 1,600,000 | $ | 5,203 | $ | 294,764 | $ | 6,695,503 | |||||||||||||||||||||
Rainer M. Blair, Executive Vice President | $ | 625,000 | 0 | $ | 1,390,207 | $ | 1,103,517 | $ | 1,000,000 | 0 | $ | 112,539 | $ | 4,231,263 | ||||||||||||||||||||||
William K. Daniel II, Executive Vice President | $ | 773,953 | 0 | $ | 1,946,104 | $ | 1,544,841 | $ | 1,300,000 | 0 | $ | 165,556 | $ | 5,730,454 | ||||||||||||||||||||||
Angela S. Lalor, Senior Vice President – Human Resources | $ | 634,185 | 0 | $ | 1,167,663 | $ | 926,946 | $ | 1,050,000 | 0 | $ | 120,285 | $ | 3,899,079 | ||||||||||||||||||||||
Name and Principal Position | Salary | Bonus | Stock Awards | Option Awards | Non-Equity Incentive Plan Compensation | Change in Pension Value and Nonqualified Deferred Compensation Earnings | All Other Compensation | Total | ||||||||||||||||||||||||
Rainer M. Blair | $ | 949,067 | 0 | $ | 3,616,939 | $ | 2,968,651 | $ | 2,519,339 | 0 | $ | 342,765 | $ | 10,396,761 | ||||||||||||||||||
President and CEO | ||||||||||||||||||||||||||||||||
Matthew R. McGrew, | $ | 726,000 | 0 | $ | 1,637,982 | $ | 1,435,173 | $ | 1,564,530 | 0 | $ | 166,358 | $ | 5,530,043 | ||||||||||||||||||
Executive Vice President and CFO | ||||||||||||||||||||||||||||||||
Joakim Weidemanis, | $ | 881,560 | 0 | $ | 5,065,095 | $ | 4,551,242 | $ | 1,917,000 | 0 | $ | 138,301 | $ | 12,553,198 | ||||||||||||||||||
Executive Vice President | ||||||||||||||||||||||||||||||||
Angela S. Lalor, | ||||||||||||||||||||||||||||||||
Senior Vice President- Human Resources | $ | 727,157 | $ | 800,000 | $ | 1,276,951 | $ | 1,118,710 | $ | 1,458,386 | 0 | $ | 121,041 | $ | 5,502,245 | |||||||||||||||||
Brian W. Ellis, | ||||||||||||||||||||||||||||||||
Senior Vice President- General Counsel | $ | 636,522 | 0 | $ | 867,259 | $ | 760,023 | $ | 1,218,048 | 0 | $ | 78,980 | $ | 3,560,832 | ||||||||||||||||||
Thomas P. Joyce, Jr. | $ | 1,352,000 | 0 | $ | 6,260,748 | $ | 5,487,776 | $ | 3,107,797 | $ | 6,470 | $ | 549,165 | $ | 16,763,956 | |||||||||||||||||
Former President and CEO | ||||||||||||||||||||||||||||||||
William K. Daniel II, | $ | 286,116 | 0 | $ | 2,553,117 | $ | 2,237,419 | $ | 462,882 | 0 | $ | 203,265 | $ | 5,742,799 | ||||||||||||||||||
Former Executive Vice President |
2021 PROXY STATEMENT12
Election of Directors of Danaher
PROPOSAL 1 — ELECTION OF DIRECTORS OF DANAHER
The Board has fixed the number of directors at eleven and our entire Board is elected annually. We are seeking your support for the election of the eleventwelve candidates that the Board has nominated to serve on the Board of Directors (each of whom currently serves as a director of the Company), to serve until the 20192022 Annual Meeting of shareholders and until his or her successor is duly elected and qualified.
We believe thesethe nominees set forth below have qualifications consistent with our position as a large, global and diversified science and technology company. We also believe these nominees have the experience and perspective to guide Danaher as we seek to expand our business in high-growth geographies and high-growth market segments,
identify, consummate and integrate appropriate acquisitions, develop innovative and differentiated new products and services, adjust to rapidly changing technologies, business cycles and competition and address the demands of an increasingly regulated environment.
Proxies cannot be voted for a greater number of persons than the eleventwelve nominees named in this Proxy Statement. In the event a nominee declines or is unable to serve, the proxies may be voted in the discretion of the proxy holders for a substitute nominee designated by the Board, or the Board may reduce the number of directors to be elected. We know of no reason why this will occur.
2018 Director Nominees
RAINER M. BLAIR | |||||
Director | |||||
since: 2020 CHIEF EXECUTIVE OFFICER Committees: • Executive •Finance •Science & Technology Other PublicDirectorships: •None |
• • •Technology/innovation strategy | ||||
•M&A •Public company CEO and/or President Mr.
|
LINDA HEFNER FILLER | |||||
Age 61 Director since: 2005 INDEPENDENT Committees: •Nominating & Governance (Chair) •Science & Technology Other PublicDirectorships: •None | SKILLS AND QUALIFICATIONS:
• •M&A •Branding/marketing | ||||
Ms. Hefner Filler served as President of Retail Products, Chief Marketing Officer and Chief Merchandising Officer of Walgreen Co., a national drugstore chain, from January 2015 to April 2017. From March 2013 until June 2014, Ms. Hefner Filler served as President, North America of Claire’s Stores, Inc., a specialty retailer; from May 2007 to June 2012, as Executive Vice President of Wal-Mart Stores Inc., an operator of retail stores and warehouse clubs, and from April 2009 to June 2012 also as Chief Merchandising Officer for Sam’s Club, a division of Wal-Mart; and from May 2004 through December 2006, as Executive Vice President—Global Strategy for Kraft Foods Inc., a food and beverage company.
Ms. Hefner Filler has served in senior management roles with leading retail and consumer goods companies, with general management responsibilities and responsibilities in the areas of marketing, branding and merchandising. Understanding and responding to the needs of our customers is fundamental to Danaher’s business strategy, and Ms. Hefner Filler’s keen marketing and branding insights have been a valuable resource to Danaher’s Board. Her prior leadership experiences with large public companies have given her valuable perspective for matters of global portfolio strategy and capital allocation as well as global business practices. |
|
2021 PROXY STATEMENT13
| TERI LIST | |||
Age 58 Director since: 2011 INDEPENDENT Committees: •Audit •Compensation Other PublicDirectorships: •Microsoft Corporation •Oscar Health, Inc. | SKILLS AND QUALIFICATIONS:
• •Accounting •Finance | |||
|
| ||||
Ms.
Ms.
|
WALTER G. LOHR, JR. | |||||
Age 77 Director since: 1983 INDEPENDENT Committees: •Audit •Compensation •Finance •Nominating & Governance Other PublicDirectorships: •None | SKILLS AND QUALIFICATIONS:
• | ||||
Mr. Lohr was a partner of Hogan Lovells, a global law firm, for over five years until retiring in June 2012, and has also served on the boards of private and non-profit organizations.
Prior to his tenure at Hogan Lovells, Mr. Lohr served as assistant attorney general for the State of Maryland. He has extensive experience advising companies in a broad range of transactional matters, including mergers and acquisitions, contests for corporate control and securities offerings. His extensive knowledge of the legal strategies, issues and dynamics that pertain to mergers and acquisitions and capital raising has been a critical resource for Danaher given the importance of its acquisition program. |
JESSICA L. MEGA, MD, MPH | |||||
Age 46 Director since: 2019 INDEPENDENT Committees: •Science & Technology Other PublicDirectorships: •None | SKILLS AND QUALIFICATIONS: •Life sciences/healthcare •Technology/innovation strategy •Global/international Dr. Mega has served as Chief Medical and Scientific Officer at Verily Life Sciences LLC, a subsidiary of Alphabet Inc. focused on life sciences and healthcare, since March 2015. Prior to joining Verily, she served as Cardiologist and Senior Investigator at Brigham & Women’s Hospital from 2008 to March 2015. Dr. Mega has also served as a faculty member at Harvard Medical School and a senior investigator with the TIMI Study Group, where she helped lead international trials evaluating novel cardiovascular therapies and directed the genetics program. Dr. Mega oversees Verily’s clinical and science efforts, focusing on translating technological innovations and scientific insights into partnerships and programs that improve patient outcomes. Dr. Mega’s clinical background and experience re-imagining how clinical trial data is collected and analyzed offer valuable insights for Danaher, given our strategic focus on life sciences and healthcare applications. |
MITCHELL P. RALES | ||||
Age 64 Director since: 1983 CHAIRMAN OF THE EXECUTIVE COMMITTEE Committees: •Executive (Chair) •Finance (Chair) Other PublicDirectorships: •Colfax Corporation •Fortive Corporation | SKILLS AND QUALIFICATIONS:
• •Public company CEO and/or President •Finance | |||
Mr. Rales is a co-founder of Danaher and has served as Chairman of the Executive Committee of Danaher since 1984. He was also President of the Company from 1984 to 1990. Mr. Rales is also a member of the board of directors of each of Colfax Corporation and Fortive Corporation, and is a brother of Steven M. Rales.
The strategic vision and leadership of Mr. Rales and his brother, Steven Rales, helped create the Danaher Business System and have guided Danaher down a path of consistent, profitable growth that continues today. In addition, as a result of his substantial ownership stake in Danaher, he is well-positioned to understand, articulate and advocate for the rights and interests of the Company’s shareholders. |
|
2021 PROXY STATEMENT14
STEVEN M. RALES | ||||
Age 69 Director since: 1983 CHAIRMAN OF THE BOARD Committees: •Executive •Finance •Science & Technology Other PublicDirectorships: •Fortive Corporation | SKILLS AND QUALIFICATIONS:
• •Public company CEO and/or President | |||
Mr. Rales is a co-founder of Danaher and has served as Danaher’s Chairman of the Board since 1984. He was also CEO of the Company from 1984 to 1990. Mr. Rales is also a member of the board of directors of Fortive Corporation, and is a brother of Mitchell P. Rales.
The strategic vision and leadership of Mr. Rales and his brother, Mitchell Rales, helped create the Danaher Business System and have guided Danaher down a path of consistent, profitable growth that continues today. In addition, as a result of his substantial ownership stake in Danaher, he is well-positioned to understand, articulate and advocate for the rights and interests of the Company’s shareholders. |
PARDIS C. SABETI, MD, D.PHIL | ||||
Age 45 Director since: 2019 INDEPENDENT Committees: •Science & Technology Other PublicDirectorships: •None | SKILLS AND QUALIFICATIONS: •Life sciences/healthcare •Global/international Dr. Sabeti has served as an Investigator for the Howard Hughes Medical Institute (“HHMI”), a non-profit medical research organization, since November 2015. Dr. Sabeti is a professor at the Center for Systems Biology and the Department of Organismic and Evolutionary Biology at Harvard University and the Department of Immunology and Infectious Disease at Harvard T.H. Chan School of Public Health. She is an Institute Member of the Broad Institute of MIT and Harvard. Dr. Sabeti is a computational geneticist with expertise developing new experimental technologies and computational algorithms to investigate the genomes of humans and infectious microbes. Her expertise in infectious disease research offers significant value to Danaher as we seek to develop research tools for use in determining the causes of disease, identification of new therapies and testing of new drugs and vaccines. |
JOHN T. SCHWIETERS | ||||
Age 81 Director since: 2003 INDEPENDENT Committees: •Audit (Chair) •Nominating & Governance Other PublicDirectorships: •None | SKILLS AND QUALIFICATIONS:
• •Accounting •Finance | |||
Mr. Schwieters has served as Principal of Perseus TDC, a real estate investment and development firm, since July 2013. He also served as a Senior Executive of Perseus, LLC, a merchant bank and private equity fund management company, from May 2012 to June 2016 and as Senior Advisor from March 2009 to May 2012.
In addition to his roles with Perseus, Mr. Schwieters led the Mid-Atlantic region of one of the world’s largest accounting firms after previously leading that firm’s tax practice in the Mid-Atlantic region, and has served on the boards and chaired the audit committees of several NYSE-listed public companies. He brings to Danaher extensive knowledge and experience in the areas of public accounting, tax accounting and finance, which are areas of critical importance to Danaher as a large, global and complex public company. |
ALAN G. SPOON | |||||
Age 69 Director since: 1999 INDEPENDENT Committees: •Compensation (Chair) Other PublicDirectorships: •Fortive Corporation •IAC/ InterActiveCorp. •Match Group, Inc. | SKILLS AND QUALIFICATIONS:
• •Global/international | ||||
•Public company CEO and/or President •Branding/marketing Mr. Spoon
In addition to his leadership |
2021 PROXY STATEMENT15
RAYMOND C. STEVENS, PH.D. | ||||
Age 57 Director since: 2017 INDEPENDENT Committees: •Science & Technology Other PublicDirectorships: •None | SKILLS AND QUALIFICATIONS:
• •Technology/innovation strategy | |||
Professor Stevens has served as Provost Professor of Biological Sciences and Chemistry, and Director of The Bridge Institute, at the University of Southern California, a private research university, since July
Professor Stevens is considered among the world’s most influential biomedical scientists in molecular research. A pioneer in human cellular behavior research, he has been involved in the creation of therapeutic molecules that led to breakthrough drugs aimed at curing influenza, childhood diseases, neuromuscular disorders and diabetes. Professor Stevens’ insights in the area of molecular research, as well as his experience bringing industry and academia together to advance drug development, are highly beneficial to Danaher given our strategic focus on the development of research tools used to understand the causes of disease, identify new therapies and test new drugs and vaccines. |
|
ELIAS A. ZERHOUNI, | MD | ||||
Age 69 Director since: 2009 INDEPENDENT Committees: •Nominating & Governance •Science & Technology (Chair) Other PublicDirectorships: •None | SKILLS AND QUALIFICATIONS:
• •Technology/innovation strategy •Government, legal or regulatory | ||||
Dr. Zerhouni
Dr. Zerhouni, a physician, scientist and world-renowned leader in radiology research, is widely viewed as one of the leading authorities in the United States on emerging trends and issues in medicine and medical care. These insights, as well as his deep, technical knowledge of the research and clinical applications of medical technologies, are of considerable importance given Danaher’s strategic focus in the medical technologies markets. Dr. Zerhouni’s government experience also gives him a strong understanding of how government agencies work, and his experience growing up in North Africa, together with the global nature of the issues he faced at NIH and his role at France-based Sanofi, give him a global perspective that is valuable to Danaher. |
The Board of Directors recommends a vote FOR each of the foregoing nominees.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE |
Board Selection and Refreshment
Director Selection.Selection
The Board and its Nominating and Governance Committee believe that it is important that our directors demonstrate:
• | personal and professional integrity and character; | |
• | prominence and reputation in the director’s profession; | |
• | skills, expertise and background (including business or other relevant experience) that in aggregate are useful and appropriate in overseeing and providing strategic direction with respect to Danaher’s business and serving the long-term interests of Danaher’s shareholders; | |
• | the capacity and desire to represent the interests of the shareholders as a whole; and | |
• | availability to devote sufficient time to the affairs of Danaher. |
2021 PROXY STATEMENT16
The Nominating and Governance Committee is responsible for recommending to the Board a slate of nominees for election at each annual meeting of shareholders. Nominees may be suggested by directors, members of management, shareholders or in some cases, by a third-party search firm.firm engaged by the Committee. The Committee considers a wide range of factors when assessing potential director nominees. This includes consideration of the current composition of the Board, any perceived need for one or more particular areas of expertise, the balance of management and independent directors, the need for committee-specific expertise, the evaluations of other prospective nominees and the qualifications of each potential nominee relative to the attributes, skills and experience described above. The Board does not have a formal or informal policy with respect to diversity but believes that the Board, taken as a whole, should embody a diverse set of skills, knowledge, experiences and backgrounds appropriate in light of the Company’s needs, and in this regard also subjectively takes into consideration the diversity (with(including with respect to age, race, gender and national origin) of the Board when considering director nominees.
When Danaher recruits a director candidate, either a search firm engaged by the Committee or a member of the Board contacts the prospect to assess interest and availability. The candidate will then meet with members of the Board does not make any particular weightingand at the same time, the Committee with the support of diversity or any other characteristic in evaluating nominees and directors.the search firm will conduct such further inquiries as the Committee deems appropriate. A background check is completed before a final recommendation is made to appoint a candidate to the Board.
A shareholder who wishes to recommend a prospective nominee for the Board should notify the Nominating and Governance Committee in writing using the procedures described below under “Other Information – Communications with the Board of Directors” with whatever supporting material the shareholder considers appropriate. If a prospective nominee has been identified other than in connection with a director search process initiated by the Committee, the Committee makes an initial determination is made as to whether to conduct a full evaluation of the candidate. The Committee’s determination of whether to conduct a full evaluation iscandidate based primarily on the Committee’s view as to whether a new or additional Board member is necessary or appropriate at such time, the likelihood that the prospective nominee can satisfy the evaluation factors described above, and any other factors as the Committee may deem appropriate. The Committee takes into account whatever information is provided to the Committee with the recommendation of the prospective candidate and any additional inquiries the Committee may in its discretion conduct or have conducted with respect to such prospective nominee.and any other factors the Committee may deem appropriate.
The graph below illustrates the diverse set of skills, knowledge, experiencesexpertise and backgrounds represented on our Board:
/ SKILLS AND EXPERTISE
Blair | Hefner Filler | List | Lohr | Mega | M. Rales | S. Rales | Sabeti | Schwieters | Spoon | Stevens | Zerhouni | |||||||||||||
Global/international | ||||||||||||||||||||||||
Life sciences/ healthcare | ||||||||||||||||||||||||
Technology/ innovation strategy | ||||||||||||||||||||||||
M&A | ||||||||||||||||||||||||
Public company CEO and/or President | ||||||||||||||||||||||||
Accounting | ||||||||||||||||||||||||
Finance | ||||||||||||||||||||||||
Branding/marketing | ||||||||||||||||||||||||
Government, legal or regulatory | ||||||||||||||||||||||||
Age (Board average is 62.7 years of age) | 56 | 61 | 58 | 77 | 46 | 64 | 69 | 45 | 81 | 69 | 57 | 69 | ||||||||||||
Gender | M | F | F | M | F | M | M | F | M | M | M | M | ||||||||||||
Race/Ethnicity* | C | C | C | C | C | C | C | C+ | C | C | C | C++ | ||||||||||||
Born outside U.S. |
* | “C” refers to Caucasian | |||||||||||||||||||||||||||||||||||||||
| + | |||||||||||||||||||||||||||||||||||||||
++ | Dr. Zerhouni is of North African descent. |
2021 PROXY STATEMENT17
| ||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||
| Back to Contents |
Board Orientation
Our new director orientation program includes extensive meetings with Danaher management and familiarizes new directors with Danaher’s businesses, strategies, policies and the Danaher Business System; assists them in developing company and industry knowledge to optimize their Board service; and educates them with respect to their fiduciary duties and legal responsibilities and Danaher’s corporate governance framework.
Board Refreshment
Our Board actively considers Board refreshment. Using our Board skills matrix as a guide as well as the results of our annual Board and committee self-assessment process (discussed below), the Nominating and Governance Committee evaluates Board composition at least annually and
|
identifies for Board consideration areas of expertise that would complement and enhance our current Board. In considering the Committee’s recommendations, the Board seeks to thoughtfully balance the knowledge and experience that comes from longer-term Board service with the fresh ideas, energyperspectives and new domain expertise that can come from adding new directors. The recent2019 additions of Drs. Mega and Sabeti and 2020 addition of Raymond C. Stevens, Ph.D.Mr. Blair to our Board is evidence ofevidences our focus on refreshment.refreshment and helped drive an approximately 20% reduction in our average director tenure from 2019 to 2020. To further build on the enhanced gender, age and national origin diversity from these appointments, Danaher has formally initiated a director search specifically focused on adding to the Board a Person of Color from an underrepresented community.
Proxy Access
Our Amended and Restated Bylaws (“Bylaws”) permit a shareholder, or a group of up to twenty shareholders, owning three percent or more of the Company’s outstanding shares of Common Stock continuously for at least three years to nominate and include in the Company’s annual meeting proxy materials a number of director nominees up to the greater of (x) two, or (y) twenty percent of the Board, provided that the shareholder(s) and nominee(s) satisfy the requirements specified in the Bylaws.
Majority Voting Standard
General
Our Bylaws provide for majority voting in uncontested director elections, and our Board has adopted a director resignation policy. Under the policy, our Board will not appoint or nominate for election to the Board any person who has not tendered in advance an irrevocable resignation effective in such circumstances where the individual does not receive a majority of the votes cast in an uncontested election and such resignation is accepted by the Board. If an incumbent director is not elected by a majority of the votes cast in an uncontested election, our Nominating and Governance Committee will submit for prompt consideration by the Board a recommendation whether to accept or reject the director’s resignation. The Board expects the director whose resignation is under consideration to abstain from participating in any decision regarding that resignation.
Contested Elections
At any meeting of shareholders for which the Secretary of the Company receives a notice that a shareholder has nominated a person for election to the Board of Directors in compliance with the Company’s Bylaws and such nomination has not been withdrawn on or before the tenth day before the Company first mails its notice of meeting to the Company’s shareholders, the directors will be elected by a plurality of the votes cast. This means that the nominees who receive the most affirmative votes would be elected to serve as directors.
2021 PROXY STATEMENT18
Back to Contents |
Corporate Governance Overview
Our Board of Directors recognizes that Danaher’s success over the long-term requires a robust framework of corporate governance that serves the best interests of all our shareholders. Below are highlights of our corporate governance framework, and additional details follow in the sections below.
Our Board of Directors recognizes that Danaher’s success over the long-term requires a robust framework of corporate governance that serves the best interests of all our shareholders. Below are highlights of our corporate governance framework, and additional details follow in the sections below. | ||||||
Our Bylaws provide for proxy access by shareholders.
Our Chairman and CEO positions are separate.
Our Board has established a Lead Independent Director position.
All of our directors are elected annually.
In uncontested elections, our directors must be elected by amajority of the votes cast, and |
|
Shareholders owning 25% or more of our outstanding shares may call a special meeting of shareholders.
We have never had a shareholder rights plan.
We have no supermajority voting requirements in our Certificateof Incorporation or Bylaws.
All members of our Audit, Compensation and Nominating and Governance Committees are independent as defined by the NewYork Stock Exchange listing standards and applicable SEC rules.
Danaher (including its subsidiaries during the period we have ownedthem) has made no political contributions since at least 2012, The 2020 CPA-Zicklin Index of Corporate PoliticalDisclosure and Accountability ranked Danaher as a First Tiercompany. |
Shareholder Engagement Program
We actively seek and highly value feedback from our shareholders. During 2017, in addition to our traditional Investor Relations outreach efforts, we engaged with shareholders representing approximately 25% of our outstanding shares on topics including our business and financial performance, governance and executive compensation programs and sustainability initiatives. Feedback received during these meetings was shared with our Nominating & Governance Committee and Compensation Committee, informing their decision-making.
Board Leadership Structure, Risk Oversight and CEO Succession Planning
Board Leadership Structure
The Board has separated the positions of Chairman and CEO because it believes that, at this time, this structure best enables the Board to ensure that Danaher’s business and affairs are managed effectively and in the best interests of shareholders. This is particularly the case in light of the fact that the Company’s Chairman is Steven Rales, aco-founder of the Company who owns approximately 6.26.0 percent of the Company’s outstanding shares, served as CEO of the company from 1984 to 1990 and continues to serve as an executive officer of the company. As a result of his substantial ownership stake in the Company, the Board believes that Mr. Rales is uniquely able to understand, articulate and advocate for the rights and interests of the Company’s shareholders. Moreover, Mr. Rales uses his management experience with the Company and Board tenure to help ensure that thenon-management directors have a keen understanding of the Company’s business as well as the strategic and other risks and opportunities that the Company faces. This enables the Board to more effectively provide insight and direction to, and exercise oversight of, the Company’s President and CEO and the rest of the management team responsible for the Company’sday-to-day business (including with respect to oversight of risk management).
Because Mr. Rales is not independent within the meaning of the NYSE listing standards, our Corporate Governance Guidelines require the appointment of a “Lead Independent Director” and Mr. Ehrlich has beenour independent directors have appointed Ms. Hefner Filler as our Lead Independent Director. As the Lead Independent Director, Mr. Ehrlich:Ms. Hefner Filler:
• | presides at all meetings of the Board at which the Chairman of the Board and the Chair of the Executive Committee are not present, including the executive sessions of non-management directors; | |
• | has the authority to call meetings of the independent directors; | |
• | acts as a liaison as necessary between the independent directors and the management directors; and | |
• | advises with respect to the Board’s agenda. |
2021 PROXY STATEMENT19
Board Oversight of Strategy
One of the Board’s primary responsibilities is overseeing management’s development and execution of the Company’s strategy. At least quarterly, the CEO, our executive leadership team and other business leaders provide detailed business and strategy updates to the Board. The Board annually conducts an even more in-depth review of the Company’s overall strategy. At these reviews, the Board engages with our executive leadership team and other business leaders regarding business objectives, the competitive landscape, economic trends and other developments. On an annual basis the Board also reviews the Company’s human capital, risk assessment/risk management, compliance and sustainability programs as well as the Company’s operating budget, and at meetings occurring throughout the year the Board reviews acquisitions, strategic investments and other capital allocation topics as well as the Company’s operating and financial performance, among other matters. The Board also looks to the focused expertise of its committees to inform strategic oversight in their areas of focus.
SPOTLIGHT: OVERSIGHT OF STRATEGIC ACQUISITIONS | ||
The Board oversees Danaher’s strategic acquisition and integration process. Danaher views acquisitions as an important element of our strategy to deliver long-term shareholder value. Our Board includes eight members with extensive business combination experience. That depth of experience allows the Board to constructively engage with management and effectively evaluate acquisitions for alignment with our strategy, culture and financial goals. Management is charged with identifying potential acquisition targets, executing transactions and managing integration, and our Board’s oversight extends to each of these elements. Management and the Board regularly discuss potential acquisitions and their role in the Company’s overall business strategy. These discussions address acquisitions in process and potential future acquisitions, and cover a broad range of matters which may include valuation, due diligence, risk and anticipated synergies with Danaher’s businesses and strategy. With respect to more significant acquisitions, such as the Company’s 2020 acquisition of Cytiva, the Board typically discusses and evaluates the proposed opportunity over multiple meetings. The Board’s acquisition oversight also extends across transactions and over time; at least annually the Board reviews and provides feedback regarding the operational and financial performance of our historical acquisitions. | ||
SPOTLIGHT: OVERSIGHT OF HUMAN CAPITAL MANAGEMENT AND CEO SUCCESSION PLANNING |
• •With the support of our Nominating and Governance Committee, our Board also maintains and annually reviews both a long-term succession plan and emergency succession plan for the CEO position. The foundation of the long-term CEO succession planning process is a CEO development model consisting of two dimensions, leadership behaviors and development experiences. The Board uses the development model as a guide in preparing candidates, and also in evaluating candidates for the CEO and other executive positions at the Board’s annual talent review and succession planning session. At the annual session, the Board evaluates and compares candidates using the development model, and reviews each candidate’s development actions, progress and performance over time. The candidate evaluations are supplemented with periodic 360-degree performance appraisals, and the Board also regularly interacts with candidates at Board dinners and lunches, through Board meeting presentations and at the Company’s annual leadership conference. The transition of the CEO role from Thomas P. Joyce, Jr. to Rainer M. Blair in September 2020 represents a culmination of this ongoing process. |
2021 PROXY STATEMENT20
Board Oversight of Risk Oversight
The Board’s role in risk oversight at the Company is consistent with the Company’sour leadership structure, with management havingday-to-day responsibility for assessing and managing the Company’sour risk exposure and the Board and its committees overseeing those efforts, with particular emphasis on the most significant risks facing the Company. Each committee reports to the full Board on a regular basis, including as appropriate with respect to the committee’s risk oversight activities. On an annual basis, the Company’s Risk Committee (consisting of members of senior management) inventories, assesses and prioritizes the most significant risks facing the Company as well as related mitigation efforts and provides a report to the Board. With respect to the manner in which the Board’s risk oversight function impacts the Board’s leadership structure, as described above our Board believes that Mr. Steven Rales’ management experience and tenure help the Board to more effectively exercise its risk oversight function.
The Board administers its risk oversight responsibilities both through active review and discussion of key risks facing the Company and by delegating certain risk oversight responsibilities to the Board committees for further consideration and evaluation. Generally, each committee has responsibility to identify and address risks that are associated with the purpose of, and responsibilities delegated to, that committee. Each committee reports to the full Board on a regular basis, including as appropriate with respect to the committee’s risk oversight activities.
|
| |
Full Board | Risks associated with Danaher’s strategic plan, acquisition and capital allocation program, capital structure, liquidity, organizational structure and other significant risks, and overall risk assessment and risk management policies. | |
Audit Committee | Major financial risk exposures, significant legal, compliance, reputational, cybersecurity and | |
Compensation Committee | Risks associated with compensation policies and practices, including incentive compensation. | |
Nominating and Governance Committee | Risks related to corporate governance, effectiveness of Board and committee oversight and review of director candidates, conflicts of interest, director independence and | |
Science and Technology Committee | Risks related to potentially disruptive science and technology trends and opportunities. |
CEO Succession Planning
SPOTLIGHT: OVERSIGHT OF CYBERSECURITY RISK |
The Board and the Audit Committee oversee the Company’s management of cybersecurity risk. To mitigate the risks posed by cybersecurity incidents and cyber attacks, we have developed a program, led by the Company’s Chief Information Security Officer (“CISO”), that is designed to protect the confidentiality, integrity and availability of the Company’s products, data and systems. This program is designed to reflect industry best practices and standards and includes a cybersecurity incident response plan, pursuant to which we conduct regular exercises to help ensure effectiveness and maintain preparedness; independent program assessments, including penetration testing and scanning of our systems for vulnerabilities; regular education and best practice sharing with our associates to raise cyber threat awareness; and other policies and procedures designed to assist the Company in managing cybersecurity incidents and risks. Danaher’s Chief Information Officer and CISO provide regular updates to the Audit Committee regarding this program, including information about cyber risk management governance and the status of projects to strengthen cybersecurity controls. |
With the support of our Nominating and Governance Committee, our Board maintains and annually reviews both a long-term succession plan and emergency succession plan for the CEO position. The foundation of the long-term succession planning process is a CEO development model consisting of two dimensions, leadership behaviors and development experiences. The Board uses the development model as a guide in preparing candidates, and also in evaluating candidates for the CEO and other executive positions at the Board’s annual talent review and succession planning session. At the annual session, the Board evaluates and compares candidates using the development model, and reviews each candidate’s development actions and progress over time as well as business performance. The candidate evaluations are supplemented with periodic360-degree performance appraisals, and the Board also regularly interacts with candidates at Board dinners and lunches, through Board meeting presentations and at the Company’s annual leadership conference.
Board of Directors and Committees of the Board
General
General
The Board met sevennine times during 2017.in 2020. All directors who served on the Board for all of 2020 attended at least 75% of the aggregate100% of the total number of meetings of the Board and of all committees of the Board on which they served (during the period they so served) during 2017.served. Danaher typically schedules a Board meeting in conjunction with each annual meeting of shareholders and as a general matter expects that the members of the Board will attend the annual meeting. ElevenThirteen of our directors (which constituted the entire Board as of such time) attended the Company’s annual meeting in May 2017.2020.
The membership of each of the Board’s committees as of March 12, 20188, 2021 is set forth to the right.below. While each of the Committeescommittees is authorized to delegate its powers tosub-committees, none of the Committeecommittees did do so during 2017.2020. The Audit, Compensation, Nominating & Governance and Nominating and GovernanceScience & Technology Committees report to the Board on their actions and recommendations at each regularly scheduled Board meeting.
2021 PROXY STATEMENT21
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
|
Name of Director | Audit | Compensation | Nominating & Governance | Science & Technology | Executive | Finance | ||||||
Rainer M. Blair | ||||||||||||
Linda Hefner Filler | ||||||||||||
Teri List | ||||||||||||
Walter G. Lohr, Jr. | ||||||||||||
Jessica L. Mega, MD, MPH | ||||||||||||
Mitchell P. Rales | ||||||||||||
Steven M. Rales | ||||||||||||
Pardis C. Sabeti, MD, D.Phil. | ||||||||||||
John T. Schwieters | ||||||||||||
Raymond C. Stevens, Ph.D. | ||||||||||||
Alan G. Spoon | ||||||||||||
Elias A. Zerhouni, MD | ||||||||||||
# OF MEETINGS HELD IN 2020 | 6 | 9 | 12 | 5 | 1 | 1 |
|
Audit Committee
The Audit Committee met seven times during 2017.
The Audit Committee prepares a report as required by the SEC to be included in this Proxy Statement and assists the Board in overseeing:
• | the quality and integrity of Danaher’s financial statements; | |
• | the effectiveness of Danaher’s internal control over financial reporting; | |
• | the qualifications, independence and performance of Danaher’s independent auditors; | |
• | the performance of Danaher’s internal audit function; | |
• | Danaher’s compliance with legal and regulatory requirements; | |
• | the risks described above under “-Risk Oversight”; and | |
• | the Company’s swaps and derivatives transactions and related policies and procedures. |
The Board has determined that each of the members of the Audit Committee is independent for purposes of Rule10A-3(b)(1) under the Securities Exchange Act of 1934, as amended (“Securities Exchange Act”) and the NYSE listing standards and is financially literate within the meaning of the NYSE listing standards. In addition, the Board has determined that Ms. List and Mr. Schwieters each qualifies as an audit committee financial expert as that term is defined in Item 407(d)(5) of RegulationS-K under the Securities Exchange Act and is financially literate within the meaning of the NYSE listing standards.Act. The Committee typically meets in executive session, without the presence of management, at its regularly scheduled meetings.
Compensation Committee
The Compensation Committee met seven times during 2017.
The Compensation Committee discharges the Board’s responsibilities relating to the compensation of our executive officers, including setting goals and objectives for, evaluating the performance of, and approving the compensation paid to, our executive officers. The Committee also:
• | reviews and discusses with Company management the Compensation Discussion and Analysis and recommends to the Board the inclusion of the Compensation Discussion and Analysis in the annual meeting proxy statement; | |
• | reviews and makes recommendations to the Board with respect to the adoption, amendment and termination of all executive incentive compensation plans and all equity compensation plans, and exercises all authority of the Board (and all responsibilities assigned by such plans to the Committee) with respect to the oversight and administration of such plans; | |
• | reviews and considers the results of shareholder advisory votes on the Company’s executive compensation, and makes recommendations to the Board regarding the frequency of such advisory votes; |
2021 PROXY STATEMENT22
• | monitors compliance by directors and executive officers with the Company’s stock ownership requirements; | |
• | assists the Board in overseeing the risks described above under “-Risk Oversight”; | |
• | prepares the report required by the SEC to be included in the annual meeting proxy statement; and | |
• | considers factors relating to independence and conflicts of interests in connection with the engagement of the compensation consultants that provide advice to the Committee. |
Each member of the Compensation Committee is an “outsidea “non-employee director” for purposes of Section 162(m), a“non-employee director” for purposes ofRule 16b-3 under the Securities Exchange Act and, based on the determination of the Board, independent under the NYSE listing standards and under Rule10C-1 under the Securities Exchange Act. The Committee typically meets in executive session, without the presence of management, at its regularly scheduled meetings.
Management Role in Supporting the Compensation Committee
Our Senior Vice President-Human Resources, Vice President-Compensation and Secretary
Members of our senior management generally attend and fromtime-to-time our CEO attends, the Compensation Committee meetings. In particular,addition, our CEO:
• | provides background regarding the interrelationship between our business objectives and executive compensation matters and advises on the alignment of incentive plan performance measures with our overall strategy; | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | participates in the Committee’s discussions regarding the performance and compensation of the other executive officers and provides recommendations to the Committee regarding all significant elements of compensation paid to such officers, their annual, personal performance objectives and his evaluation of their performance (the Committee gives considerable weight to our CEO’s evaluation of and recommendations with respect to the other executive officers because of his direct knowledge of each such officer’s performance and contributions); and | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | provides feedback regarding the companies that he believes Danaher competes with in the marketplace and for executive talent.
Our human resources and legal departments also assist the Committee Chair in scheduling and setting the agendas for the Committee’s meetings,
Independent Compensation Consultant Role in Supporting the Compensation Committee Under the terms of its charter, the Committee has the authority to engage the services of outside advisors and
The Committee does not place any material limitations on the scope of the feedback provided by FW Cook. In the course of discharging its responsibilities, FW Cook may from time to time and with the Committee’s consent, request from management information regarding compensation amounts and practices, the interrelationship between our business objectives and executive compensation matters, the nature of the Company’s executive officer responsibilities and other business information. The Committee has considered whether the 2021 PROXY STATEMENT23 Nominating
The Nominating and Governance Committee:
The Board has determined that all of the members of the Nominating and Governance Committee are independent within the meaning of the NYSE listing standards.
Science & Technology Committee The Science and Technology Committee assists the Board in overseeing matters of science and technology, including:
Executive Committee The Executive Committee exercises between meetings of the Board such powers and authority as are specifically delegated to it by the Board from time to time. Finance Committee The Finance Committee approves business acquisitions, investments and divestitures up to the levels of authority delegated to it by the Board.
Board and Committee Evaluations Each year, our Board and the Audit, Compensation and Nominating and Governance Committees perform a rigorous self-evaluation, overseen by the Nominating and Governance Committee. In 2020, the Nominating and Governance Committee solicited input from our directors regarding topics that warranted evaluation in each of the following areas:
2021 PROXY STATEMENT24 The Nominating and Governance Committee reviewed the results of this feedback, and during an executive session of the Board the chair of the Committee led a discussion of the key topics identified and communicated relevant feedback to the CEO. Each of our Audit, Compensation and Nominating and Governance Committees also conducted a self-evaluation in executive session, including with respect to any committee-specific evaluation topics identified as a result of the process described above, and communicated the results thereof to the full Board. As a result of the Board’s 2020 self-assessment process, the Board identified objectives for itself relating to the Company’s strategic plan, organizational capabilities and risk management program; the optimization of Board meeting processes; incorporation of individual director self-assessments into the Board evaluation program; director education; and Board diversity. Shareholder Engagement and Alignment Shareholder Engagement Program We actively seek and highly value feedback from our shareholders. During 2020, in addition to our traditional Investor Relations outreach efforts, we engaged with shareholders representing approximately 25% of our outstanding shares on topics including our business strategy and financial performance, governance and executive compensation programs and sustainability initiatives. We shared feedback received during these meetings with our Nominating and Governance Committee and Compensation Committee, informing their decision-making. Key Policies Aligning Company and Shareholder Interests
Notwithstanding that these shares are exempted from Danaher’s policy, as part of its risk oversight function the Audit Committee of Danaher’s Board regularly reviews these share pledges to assess whether such pledging poses an undue risk to the Company. The Committee has concluded that the existing pledge arrangements do not pose an undue risk to the Company, based in particular on its consideration of the following factors:
2021 PROXY STATEMENT25 Danaher policy also prohibits Danaher directors and employees (including executive officers) from engaging in short sales of Danaher Common Stock, transactions in any derivative of a Danaher security (including, but not limited to, buying or selling puts, calls or other options (except for instruments granted under a Danaher equity compensation plan)) or any other forms of hedging transactions with respect to Danaher securities.
At Danaher’s 2020 Annual Meeting, shareholders representing a majority of Danaher shares voted against a shareholder proposal requesting that Danaher amend its governing documents to reduce the percentage of shares required for shareholders to call a special meeting of shareholders from 25% to 10%. Danaher’s Nominating and Governance Committee and Company management annually review Danaher’s governing documents, and the proposal, investor feedback thereon and the voting results (in 2020 and in the prior years when a similar proposal has been brought) were taken into account in considering whether a modification to Danaher’s special meeting threshold is warranted. It was determined that the existing 25% threshold continues to strike an appropriate balance between avoiding waste of Danaher and shareholder resources on addressing narrow or special interests, while at the same time ensuring that shareholders holding a significant minority of our outstanding shares have an appropriate mechanism to call a special meeting if they deem it appropriate. Sustainability Danaher’s sustainability program is distinctive in that we drive company-wide sustainability initiatives where it makes sense to harness Danaher’s scale, while leveraging our decentralized operating structure to empower our operating companies to pursue sustainability in ways that best fit the needs of their particular stakeholders. Based on a materiality assessment we conducted that identified the intersection of Danaher’s key strategic and sustainability goals, our sustainability program is structured around three pillars: innovation, people and the environment. These three pillars are underpinned by a foundation of integrity, compliance and sound governance.
2021 PROXY STATEMENT26
More information about Danaher’s sustainability efforts is included in our latest Sustainability Report, available in the Corporate Governance Guidelines, Committee Charters and As part of its ongoing commitment to good corporate governance, our Board of Directors has codified its corporate governance practices into a set of Corporate Governance Guidelines and has also adopted written charters for each of the committees of the Board. Danaher has also adopted a code of business conduct and ethics for directors, officers (including our principal executive officer, principal financial officer and principal accounting officer) and employees, known as the
Non-Management Director Compensation Program Non-Management Director Compensation Philosophy We use a combination of cash and equity-based compensation to attract and retain qualified candidates to serve on the Board. In setting director compensation, the Board and the Nominating and Governance Committee are guided by the following principles:
Process for Setting Non-Management Director Compensation The Nominating and Governance Committee is responsible for reviewing and making recommendations to the Board regardingnon-management director compensation (although the Board makes the final determination regarding the amounts and type ofnon-management director compensation). Since 2011, the Committee has engaged FW Cook, the Board’s independent compensation consultant, to prepare regular reports on marketnon-management director compensation practices and evaluate our program in light of the results of such reports. The Committee Danaher’s 2007 Omnibus Incentive Plan (the “Plan” or the “Omnibus Plan”) limits the amount of cash and equity compensation that we may pay to anon-management director each year. Under the plan terms, an annual limit of $800,000 per calendar year applies to the sum of all cash and equity-based awards (calculated based on the grant date fair value of such awards for financial reporting purposes) granted to eachnon-management director for services as a member of the Board (plus an additional limit of $500,000 per calendar year with respect to anynon-executive Board chair or vice chair). Non-Management Director Compensation Structure
Director cash 2021 PROXY STATEMENT28
Non-Management Directors’ Deferred Compensation Plan Eachnon-management director can elect to defer all or part of the cash director fees that
Director Summary Compensation Table The table below summarizes the compensation paid by Danaher to thenon-management directors for the year ended December 31,
2021 PROXY STATEMENT29
DIRECTOR INDEPENDENCE AND RELATED PERSON TRANSACTIONS Director Independence At least a majority of the Board must qualify as independent within the meaning of the listing standards of the NYSE. The Board has affirmatively determined that Mss. Hefner Filler and In making its determination with respect to the independence of the directors identified above as independent, the Board considered that in Danaher’snon-management directors (all of whom are, as noted above, independent within the meaning of the listing standards of the NYSE) meet in executive session following the Board’s regularly-scheduled meetings. The sessions are chaired by the Lead Independent Director. Certain Relationships and Related Transactions Policy Under Danaher’s written Related Person Transactions Policy, the Nominating and Governance Committee of the Board is required to review and if appropriate approve all related person transactions, prior to consummation whenever practicable. If advance approval of a related person transaction is not practicable under the circumstances or if Danaher management becomes aware of a related person transaction that has not been previously approved or ratified, the transaction is submitted to the Committee at the Committee’s next meeting. The Committee is required to review and consider all relevant information available to it about each related person transaction, and a transaction is considered approved or ratified under the policy if the Committee authorizes it according to the terms of the policy after full disclosure of the related person’s interests in the transaction. Related person transactions of an ongoing nature are reviewed annually by the Committee. The definition of “related person transactions” for purposes of the policy covers the transactions that are required to be disclosed under Item 404(a) of RegulationS-K under the Securities Exchange Act. Relationships and Transactions For their service as executive officers, in 2020 each of Steven Rales and Mitchell Rales received a salary of $419,000 and 2021 PROXY STATEMENT assistant’s time for non-Danaher matters resulted in no incremental cost to Danaher. Separately, in
FJ900, Inc. (“FJ900”), an indirect, wholly-owned subsidiary of Danaher, is party to an airplane management agreement with Joust Capital II, LLC (“Joust II”) and a substantially identical agreement with Joust Capital III, LLC (“Joust III” and together with Joust II, the “Joust entities”). Joust II is In addition, Danaher is party to substantially identical airplane interchange agreements with each of the Joust entities with respect to each respective aircraft owned by Danaher and by each of the Joust entities. Under each interchange agreement, the Joust entity has agreed to lease its aircraft to Danaher and Danaher has agreed to lease the respective Danaher aircraft to the Joust entity, in each case on anon-exclusive basis. Neither party is charged for its use of the other party’s aircraft, the intent being that over the life of the contract each party’s usage of the other party’s aircraft will be generally equal. With respect to the year ended December 31,
2021 PROXY STATEMENT31
BENEFICIAL OWNERSHIP OF DANAHER COMMON STOCK BY DIRECTORS, OFFICERS AND PRINCIPAL SHAREHOLDERS The following table sets forth as of March
2021 PROXY STATEMENT32
2021 PROXY STATEMENT33
PROPOSAL 2 Ratification of Independent Registered Public Accounting Firm The Audit Committee on behalf of Danaher has selected Ernst & Young LLP, an international accounting firm of independent certified public accountants, to act as the independent registered public accounting firm for Danaher and its consolidated subsidiaries for the year ending December 31,
Audit Fees and All Other Fees The following table sets forth the fees for audit, audit-related, tax and other services rendered by Ernst & Young LLP to Danaher for
2021 PROXY STATEMENT34 The Audit Committee has considered whether the services rendered by the independent registered public accounting firm with respect to the fees described above are compatible with maintaining such firm’s independence and has concluded that such services do not impair
Audit CommitteePre-Approval of Audit and PermissibleNon-Audit Services of Independent Auditors Under its charter, the Audit Committee mustpre-approve all auditing services and permittednon-audit services to be performed for Danaher by the independent registered public accounting firm. Each year, the Committee approves the independent registered public accounting firm’s retention to audit Danaher’s financial statements and internal control over financial reporting before the filing of the preceding year’s annual report on Form10-K. The Committee also establishesdetailed pre-approved
2021 PROXY STATEMENT35
This report is not deemed to be “soliciting material” or to be “filed” with the SEC or subject to the SEC’s proxy rules or to the liabilities of Section 18 of the Securities Exchange Act of 1934, and shall not be deemed to be incorporated by reference into any prior or subsequent filing by Danaher under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent Danaher specifically incorporates this report by reference therein. The Audit Committee assists the Board in overseeing the quality and integrity of Danaher’s financial statements, the effectiveness of Danaher’s internal control over financial reporting, the qualifications, independence and performance of Danaher’s independent The Audit Committee is directly responsible for the appointment, compensation and oversight of the independent registered public accounting firm retained to audit Danaher’s financial statements and has appointed Ernst & Young LLP as Danaher’s independent registered public accounting firm for In fulfilling its responsibilities, the Audit Committee has reviewed and discussed with Danaher’s management and Ernst & Young Danaher’s audited consolidated financial statements and internal control over financial reporting. The Audit Committee has discussed with Ernst & Young Based on the reviews and discussions referred to above, the Audit Committee recommended to the Board that the audited consolidated financial statements for Danaher for the fiscal year ended December 31, Audit Committee of the Board of Directors John T. Schwieters (Chair)
2021 PROXY STATEMENT36 COMPENSATION DISCUSSION AND ANALYSIS THE FOLLOWING SECTION DISCUSSES AND ANALYZES THE COMPENSATION PROVIDED TO EACH OF THE EXECUTIVE OFFICERS SET FORTH IN THE SUMMARY COMPENSATION TABLE BELOW, ALSO REFERRED TO AS THE NAMED EXECUTIVE OFFICERS, OR NEOS. THE CONTENT OF THIS COMPENSATION DISCUSSION AND ANALYSIS IS ORGANIZED INTO SIX SECTIONS:
Overview As discussed above in the section
We note below under “—Named Executive Officer Compensation Framework” that the philosophy and goals of our compensation program have remained consistent over time but also give our Committee flexibility to take into account the then-prevailing economic and social environment. Despite the challenges posed by the pandemic and despite our leadership transition, the expectations of our executive officers in 2020 remained consistent with prior years as did the overall structure of our executive compensation program. In determining the compensation For a further discussion of Danaher’s business performance in 2020 and over the Executive
With the goal of building long-term value for our shareholders, we
attract and retain executives with the leadership skills, attributes and experience necessary to succeed in an enterprise with Danaher’s size, diversity and global footprint;
2021 PROXY STATEMENT37
To achieve these objectives our compensation program combines annual and long-term components, cash and equity, and fixed and variable elements, with a bias toward long-term equity awards tied closely to shareholder returns and subject to significant vesting and/or holding periods. Our executive compensation program rewards our executive officers when they
The science and technology markets in which we operate are competitive, with demand sometimes exceeding the supply of talent, resulting in significant increases in compensation among the companies with whom we compete for this talent. The same conditions exist in the market for executive-level talent that can provide innovative leadership while managing at a global scale across multiple complex businesses. These trends require us to regularly and proactively assess our executive compensation program to ensure it remains competitive in light of market conditions. Key Recent Changes to Executive Compensation Program Danaher’s Compensation Committee regularly reviews our executive compensation program with a view toward continuous improvement and consideration of investor feedback. Effective in 2019, the Committee enhanced the program as follows to reinforce the already-strong linkages (1) between pay and performance, (2) between the interests of our shareholders and the interests of our executive officers, and (3) between the Company’s strategic plan and executive compensation program:
2020 Say-On-Pay Vote We provide our shareholders the opportunity to cast an annual advisory vote with respect to our
2021 PROXY STATEMENT
2020 Executive Compensation
|
2017 Executive Compensation
The chart below summarizes key information with respect to each pay element represented in Danaher’s 20172020 executive compensation program:
| Primary Objectives | Performance Requirement | Key Committee Considerations in Determining 2020 Compensation | |||||||||||||||||
|
|
|
| |||||||||||||||||
Long-Term Incentive Compensation (Equity) | • Attract, retain and motivate skilled executives • Align the interests of management and shareholders by ensuring that realized compensation is:
| Stock options (50%) | •5-year, time- based vesting schedule •Options only have/increase in value if Danaher stock price increases | • This pay element represented the most significant component of compensation for each • This pay element has the heaviest weighting of all our executive
• From time to time, we also grant time-vested restricted stock units to executive |
| |||||||||||||||
Performance stock units (PSUs) | •3-year relative TSR and average ROIC performance • 2-year holding period (incremental to 3-year performance | |||||||||||||||||||
|
Annual Cash Incentive Compensation |
| • |
|
|
|
| |||||||||
|
• Attract, retain and motivate skilled executives • Allow for meaningful pay differentiation tied to annual performance of individuals and groups | Cash | Company | Adjusted Adjusted Core RevenueGrowth(3) | This pay element represented the second-most significant |
| ||||||||
| Personal Payout Percentage (40%)
| |||||||||||||
Fixed Annual Compensation |
| |||||||||||||
| • Provide sufficient fixed compensation to (1) allow a reasonable standard of living relative to peers, and (2) mitigate incentive to pursue inappropriate risk-taking to maximize variable pay | Cash | N/A | • Base salary should be sufficient to avoid competitive disadvantage while facilitating a sustainable fixed cost structure. • We also periodically use fixed cash bonuses for recruitment and retention purposes to |
2021 PROXY STATEMENT39
2020 Executive Compensation (cont.)
Pay Element | Primary Objectives | Form | Performance Requirement | Key Committee Considerations in Determining 2020 Compensation | ||||||||||
Other Compensation |
| |||||||||||||
| • Make our total executive compensation plan competitive • Improve cost-effectiveness by delivering perceived value that exceeds our actual costs | Employee benefit plans; limited perquisites; severance benefits | N/A | • We believe these elements of compensation make our total executive compensation plan competitive and are generally commensurate with the benefits offered by our peers. • We believe the limited perquisites we offer are cost-effective in that the perceived value is higher than our actual cost, and they help to maximize the amount of time that executives spend on Danaher business. |
|
Adjusted EPS, Adjusted Free CashFlow-to-Adjusted Net Income Ratio (which we also refer to as “Free Cash Flow Ratio”) and |
“Core Revenue Growth” is defined as sales from continuing operations calculated according to GAAP but excluding (1) sales from acquired businesses; and (2) the impact of currency translation. Sales attributable to acquired businesses refers to sales from acquired businesses recorded prior to the first anniversary of the acquisition less the amount of sales attributable to divested product lines not considered discontinued operations. The portion of revenue attributable to currency translation is calculated as the difference between (i) the period-to-period change in revenue (excluding sales from acquired businesses); and (ii) the period-to-period change in revenue (excluding sales from acquired businesses) after applying current period foreign exchange rates to the prior year period. |
|
2021 PROXY STATEMENT40
CEO Transition and Other Organizational Changes
Blair Appointment and Compensation
In May 2020, pursuant to the Company’s succession-planning process, Danaher’s Board of Directors announced that it had promoted Rainer M. Blair to succeed Thomas P. Joyce, Jr. as Danaher’s President and CEO effective as of September 1, 2020 (the “Effective Date”). Below is an overview of the 2020 compensation decisions our Compensation Committee made in connection with such transition. The Committee initially determined Mr. Blair’s 2020 compensation in the first quarter of 2020 and subsequently modified it as a result of his promotion to CEO. In connection with Mr. Blair’s promotion, the Committee revised his base salary, target annual cash incentive compensation opportunity and annual equity compensation target award value to levels that the Committee believes appropriate in light of his increased responsibilities as CEO and the opportunities that would be available to Mr. Blair in the competitive marketplace as a newly-appointed CEO. In determining these levels, the Committee also took into account the compensation progression over Mr. Joyce’s tenure as CEO, the significant proportion of Mr. Blair’s annual cash and equity compensation that is performance-based, his overall tenure and performance record with Danaher, his prior compensation level as an Executive Vice President and the compensation levels of the Company’s other named executive officers (without assigning any particular weighting to any of these factors). Specifically, the Committee:
• | increased Mr. Blair’s annual base salary rate from $873,600 to $1.1 million, effective as of the Effective Date; |
• | modified his 2020 annual cash incentive compensation opportunity under the Plan, effective as of the Effective Date, to provide that 66.6% of such award would be based on a target percentage of 125% and a base salary rate of $873,600 (reflecting the terms in effect during the portion of 2020 he served as Executive Vice President), and 33.4% of such award would be based on a target percentage of 200% and a base salary rate of $1.1 million (reflecting the new terms applicable to the portion of 2020 he served as President and Chief Executive Officer); |
• | approved an incremental 2020 equity award under the Plan (additional to the annual equity award granted to him in February 2020) in May 2020 with a target award value of $2.067 million, split evenly between stock options and performance stock units, in each case in a manner consistent with the Company’s standard grant practices. One-half of the stock options will vest on each of the fourth and fifth anniversaries of the grant date. The PSUs are subject to a three-year performance period and further two-year holding period, each as further described below; and |
• | approved relocation benefits in accordance with the Company’s relocation policy for executives, parking, financial/tax planning and tax preparation services, an annual physical, and personal usage of the Company aircraft beginning on the Effective Date (with any personal aircraft usage in excess of $125,000 per year subject to full reimbursement by Mr. Blair). |
Although the Committee did not target the performance-based portion of Mr. Blair’s annual cash compensation at any particular percentage of his annual cash compensation, the Committee set Mr. Blair’s base salary at a level lower, and his target annual cash incentive compensation opportunity at a level higher, than typical among the Company’s peer companies to help ensure that his annual cash compensation is highly performance-based. For details regarding the severance rights agreed to with Mr. Blair in connection with his promotion, please see “Summary of Employment Agreements and Plans – Employment Agreements - Named Executive Officer Proprietary Interest Agreements.”
Joyce Retirement and Compensation
The Committee initially determined Mr. Joyce’s 2020 compensation in the first quarter of 2020. In connection with Mr. Joyce’s retirement, Mr. Joyce agreed to continue his employment at the Company as Senior Advisor from the Effective Date through February 28, 2021 to assist in the Company’s leadership transition. The Committee determined that Mr. Joyce’s annual base salary, health and welfare benefits and perquisites would continue unchanged from the Effective Date through February 28, 2021 (except that he would be required to reimburse the Company for all personal use of the Company aircraft during such period); his 2020 annual cash incentive compensation opportunity (with a 200% target bonus percentage) would be pro-rated based on the percentage of the year he served as President and Chief Executive Officer; and his outstanding equity awards would be treated in accordance with the terms of the Company’s 2007 Omnibus Incentive Plan and the applicable award agreements. Please see “Summary of Employment Agreements and Plans – Employment Agreements – Joyce Agreement” for further details.
Weidemanis Promotion and Compensation
In connection with the departure of William K. Daniel II (who served as Executive Vice President) from the Company in March 2020, the Company’s other Executive Vice President, Joakim Weidemanis, assumed oversight responsibility for the Company’s Diagnostics segment (in addition to his existing oversight responsibility for the Company’s Environmental & Applied Solutions segment). To recognize the expansion of his responsibilities, the Committee increased Mr. Weidemanis’ base salary rate from $789,360 to $900,000 in March 2020 and granted him an incremental equity award (additional to the annual equity award granted to him in February 2020) in May 2020, as described in the “Grants of Plan-Based Awards” table.
2021 PROXY STATEMENT41
Compensation Governance
The Committee recognizes that the success of our executive compensation program over the long-term requires a robust framework of compensation governance. As a result, the Committee regularly reviews external executive compensation practices and trends and incorporates best practices into our executive compensation program:
WHAT WE DO | WHAT WE DON’T DO | ||||||
Five-year vesting requirement for | No tax gross-up provisions | ||||||
Incentive compensation programs feature multiple, different performance measures aligned with | No dividend/dividend equivalents paid on unvested equity awards | ||||||
No “single trigger” change of control benefits | |||||||
Rigorous, no-fault clawback policy that is triggered even in the absence of wrongdoing | No | ||||||
Minimum one-year vesting requirement for 95% of shares granted under the Company’s stock plan | No | ||||||
Stock ownership requirements for all executive officers |
| ||||||
| No long-term incentive compensation is denominated or paid in cash (other than PSU dividend accruals) | ||||||
No above-market returns on deferred compensation plans | |||||||
Independent compensation consultant that performs no other services for the Company | No |
Risk-taking is a necessary part of growing a business, and prudent risk management is necessary to deliver long-term, sustainable shareholder value. The Committee believes that the Company’s executive compensation program supports the objectives described above without encouraging inappropriate or excessive risk-taking. In reaching this conclusion, the Committee considered in particular the following risk-mitigation attributes of our compensation program.
ATTRIBUTE | KEY RISK MITIGATING EFFECT | |
• Emphasis on long-term, equity-based compensation • Five-year vesting requirement for
period for PSUs | • Discourages risk-taking that produces short-term results at the expense of building long-term shareholder value • Helps ensure executives realize their compensation over a time horizon consistent with achieving long-term shareholder value | |
• Rigorous, no-fault clawback policy that is triggered even inthe absence of wrongdoing | • Helps deter inappropriate actions and decisions that could harm Danaher and its key stakeholders | |
• Incentive compensation programs feature multiple, | • Mitigates incentive to over-perform with respect to any particular metric at the expense of other metrics | |
• Cap on annual cash incentive compensation plan payments andon number of shares that may be earned under equity awards
| • Mitigates incentive to over-perform with respect to any particular performance period at the expense of future periods | |
• Stock ownership requirements for all executive officers • No hedging of Danaher securities permitted | • Aligns executives’ economic interests with the long-term interests of our shareholders | |
• Annual cash incentive compensation awards are subject toCompensation Committee discretion | • Mitigates risks associated with a strictly formulaic program, which could unintentionally incentivize an undue focus on certain performance metrics or encourage imprudent risk taking | |
• Independent compensation consultant | • Helps ensure advice will not be influenced by conflicts of interest |
|
2021 PROXY STATEMENT42
Analysis of 20172020 Named Executive Officer Compensation
Overview
In determining the appropriate mix and amount of compensation elements for each named executive officerNEO for 2017,2020, the Committee considered the factors referred to under “–Named Executive Officer Compensation Framework” (without assigning any particular weight to any factor), exercised its judgment and adopted the compensation elements described above under “Summary“Executive Summary – 20172020 Executive Compensation.” The graphics below illustrate, for the CEOMr. Blair and separately for the other NEOs in aggregate, the percentage of 20172020 compensation that each element of compensation accounted for (based on the amounts reported in the 20172020 Summary Compensation Table):
Long-Term Incentive Awards
2017
Target Award Values
In February 2017,2020, the Committee subjectively determined the target dollar value of annual equity compensation to be delivered to each named executive officerNEO in 2017,2020, taking into account each of the following factors (none of which was assigned a particular weight by the Committee):
• | the relative complexity and importance of the officer’s position; |
• | the officer’s performance record and potential to contribute to future Company performance and assume additional leadership responsibility; |
• | the risk/reward ratio of the award amount compared to the length of the related vesting and holding provisions, including the fact that the combined vesting and holding periods applicable to our executive awards are longer than typical for our peer group; |
• | the amount of equity compensation necessary to provide sufficient retention value and long-term performance incentives in light of (1) compensation levels within the Company’s peer group, and (2) the officer’s historical compensation; |
• | the competitive demand for our executives; and |
• | the lack of a defined benefit pension plan for Danaher executives, and therefore the significance of long-term incentive awards as a capital accumulation opportunity. |
In determining Mr. Joyce’s annual equity compensation necessary to provide sufficient retention incentives in light of (1) compensation levels within the Company’s peer group, and (2) the officer’s historical compensation.
With the exception of our President and CEO, who was promoted to that position in September 2014, the 2017 equity compensation awards for Danaher’s named executive officers tended to be larger than peer awards for comparable positions (based on recent, publicly available data) because:
In increasing Mr. Joyce’s 2017 equity compensation by approximately 27% compared to 2016,February 2020, the Committee considered in particular the following factors. In light of the Company’s strong financial performance since Mr. Joyce was appointed President and CEO in 2014, the Committee has gradually increased his annual equity compensation from a level appropriate for a new CEO to a level that reflects the Company’s positive record of financial and operational performance under his leadership (subject to time-based and performance-based vesting criteria that link the ultimate, realized value of such awards to the Company’s performance over the next several years). The Committee also took into account:
|
2017
For a discussion of the Committee’s considerations in determining Mr. Blair’s incremental equity compensation in connection with his 2020 appointment as President and CEO, and the incremental equity award granted to Mr. Weidemanis in May 2020, please see “Executive Summary – CEO Transition and Other Organizational Changes.”
Equity Award Mix
With respect to each of the named executive officer 2017NEO 2020 annual equity awards and with respect to Mr. Blair’s incremental equity award in connection with his promotion to CEO, one-half of the target award value was delivered as stock optionsone-quarter and one-half as RSUs andone-quarter as PSUs.PSUs (please see “Grants of Plan-Based Awards” table for the grant date fair value of the awards granted to each NEO). The Committee believes that the combination of stock options RSUs and PSUs effectively balances the goals of incentivizing and rewarding shareholder value creation while supporting our talent retention objectives:
2021 PROXY STATEMENT43
• | Stock options and PSUs inherently incentivize shareholder value creation, since option holders realize no value unless our stock price rises after the option grant date and the value of PSUs is tied directly to the Company’s relative TSR performance. |
• | Our stock options vest over five years and our PSUs are subject to a three-year performance period and a further two-year holding period. In aggregate, these periods are longer than typical for our peer group, promote stability and encourage officers to take a long-term view of our performance. |
• | The Committee believes our stock option award program in particular has contributed significantly to our strong performance record, which in turn has generally made our stock option awards valuable over the long-term and highly effective in recruiting, motivating and retaining highly-skilled officers. |
The target award value of PSUs is tied directlythe incremental equity award granted to the Company’s relative TSR performance.
PSU Performance Criteria
The executive officer PSUs granted in 2020 are more likelysubject to support our talent retention objectives.
2017RELATIVE TSR
The number of shares of Common Stock that vest pursuant to the PSU and RSU Performance Criteria
In designingaward is based primarily on the Company’s total shareholder return (TSR) ranking relative to the S&P 500 Index over an approximately three-year performance criteria applicable to PSUs, theperiod. The Committee established threshold, target and maximum relative TSR performance levels and established a payout percentage curve that relates each level of performance to a payout expressed as a percentage of the target PSUs:PSUs, as illustrated in the table below:
Performance Level (Relative TSR |
| Payout Percentage | |||
Below 35thpercentile | 0 | % | |||
35thpercentile | 50 | % | |||
55thpercentile | 100 | % | |||
75thpercentile or above | 200 | % |
The payout percentages for performance between the performance levels indicated above are determined by linear interpolation. The Committee selected the S&P 500 Index as the relative TSR comparator group because the index consists of a broad and stable group of companies that represents investors’ alternative capital investment opportunities, reinforcing the linkage between our executive compensation program and the long-term interests of our shareholders.
ROIC
The Company’s three-year average ROIC performance beginning with the year of grant, compared to the Company’s ROIC for the year immediately preceding the year of grant (the “baseline year”), can increase or decrease the number of shares that would otherwise vest by 10% (but cannot cause the payout percentage to exceed 200%), as illustrated in the table below:
Three Year Average ROIC Change(3) (Compared to Baseline Year ROIC) | ROIC Modifier Factor | |||
At or above + 200 basis points | 110 | % | ||
Below + 200 basis points and above zero basis points | 100 | % | ||
At or below zero basis points | 90 | % |
(3) | “Three Year Average ROIC Change” means (1) the quotient of (a) the Company’s Adjusted Net Income for the three-year ROIC performance period divided by three, divided by (b) the Company’s Adjusted Invested Capital for the ROIC performance period, less (2) the quotient of (x) the Company’s Adjusted Net Income for the year immediately preceding the date of grant (the “baseline year”), divided by (y) the Company’s Adjusted Invested Capital for the baseline year. “Adjusted Invested Capital” means the average of the quarter-end balances for each fiscal quarter of the ROIC performance period of (a) the sum of (i) the Company’s GAAP total stockholders’ equity and (ii) the Company’s GAAP total short-term and long-term debt; less (b) the Company’s GAAP cash and cash equivalents; but excluding in all cases the impact of (1) any business acquisition by the Company for a purchase price equal to or greater than $250 million and consummated during the ROIC performance period, (2) any business sale, divestiture or disposition by the Company during the ROIC performance period, and (3) all Company investments in marketable or non-marketable securities that are consummated during the ROIC performance period. “Adjusted Net Income” is calculated in a manner similar to the definition set forth in the preceding footnote, except that (i) only transaction costs and operating gains/charges associated with acquisitions consummated during the ROIC performance period with a purchase price equal to or greater than $250 million are excluded, (ii) gains/charges associated with discontinued operations are not excluded, and (iii) gains/charges related to Company strategic investments as well as all after-tax interest expense are excluded. |
2021 PROXY STATEMENT44
Notwithstanding the above, if the Company’s absolute TSR performance for the period is negative no more than 100% of the target PSUs will vest (regardless of how strong the Company’s performance is on a relative basis), and if the Company’s absolute TSR performance for the period is positive a minimum of 25% of the target PSUs will vest. The Committee chose the S&P 500 Index as the relative TSR comparator group because the index consists of a broad and stable group of companies that represents investors’ alternative capital investment opportunities, reinforcing the linkage between our executive compensation program and the long-term interests of our shareholders.
VESTING AND HOLDING PERIOD
Any PSUs that vest following the three-year performance period are subject to an additionaltwo-year holding period and are paid out in shares of Company Common Stock following the fifth anniversary of the commencement of the performance period. Vesting is contingent on continued employment throughout the three-year performance period and until the Committee certifies satisfaction of the performance criteria, except that in the event of death during the performance period the executive receives a prorated portion of the target award based on the percentage of the performance period during which the executive was employed, and in the event of retirement (as defined in the Omnibus Plan) during the performance period the executive receives a prorated portion of the shares actually earned based on the percentage of the performance period during which the executive was employed and the Company’s performance over the performance period. Any dividends paid on the Company’s Common Stock during the performance period are credited to PSU accounts, but are only paid out (in cash) to the extent the underlying PSUs vest based on performance and are not paid until the shares underlying the vested PSUs are issued.
In 2017, the Committee applied Adjusted EPS and positive net income performance metrics to executive RSU grants to link realization of the award to the Company’s operational performance. However, because RSUs are a key retention tool and the Committee considers the RSU performance criteria as ancillary in importance to the time-based vesting requirement, effective in 2018 the Committee has eliminated the Adjusted EPS performance criteria applicable to executive RSU grants. The executive RSU grants remain subject to a five-year time-based vesting schedule and a positive net income performance requirement.
PSUs Earned for 2015-20172018-2020 Performance Period
PSUs for the 2015-20172018-2020 performance period, which ended December 31, 2017,2020, were earned and certified in February 20182021 based on an earned payout percentage of 140%200%, resulting from the Company’s three-year absolute TSR of 46.30%142.57% ranking in the 6396rdth percentile relative to the TSRs of the companies in the S&P 500 index as of the beginning of the performance period (January 1, 2015)2018). These PSUs remain subject to a furthertwo-year mandatory holding period that runs through 2019.2022.
|
Annual Incentive Awards
Umbrella Plan
In 2017, we granted annual cash incentive awards to our named executive officers under our shareholder-approved 2007 Executive Incentive Compensation Plan (“EICP”). The EICP is an umbrella plan intended to satisfy the performance-based requirements of Section 162(m) of the Internal Revenue Code (the”Code”). As it has done in prior years, in 2017 the Committee exercised negative discretion under the plan to make annual awards utilizing the performance-based formula described below (which historically has resulted in awards well below the maximum permitted under the umbrella plan). In light of the general elimination of the performance-based exemption from Section 162(m)’s deduction limit effective January 1, 2018, beginning in 2018 the Committee grants named executive officer annual cash incentive awards under the Omnibus Plan rather than the EICP. However, irrespective of the plan under which the awards are granted, the performance-based formula the Committee approved for 2018 remains consistent with the 2017 formula described below.Overview
2017 Annual Incentive Awards
The diagram below illustrates the 20172020 annual incentive award opportunities the Committee determined for the Company’s named executive officers,NEOs in February 2020 under the Omnibus Plan, each element of which is further described below.
Target Bonus Percentage and Personal Payout Percentage.
In February 2017,2020, the Committee established for each named executive officer theNEO target bonus percentagepercentages (as a multiple of base salary) and the personal performance objectives described below, including quantitative and qualitative objectives as well as objectives based on financial andnon-financial measures. The Committee did not assign a particular weighting to any of the objectives. The Committee set the quantitative objectives at levels that, while achievable, would in its opinion require personal performance appreciably above the executive’s prior year performance level. Since Mr. Joyce was in discussions with the Board about his potential retirement at the time the Committee was considering 2020 executive officer performance objectives, the Committee did not set specific 2020 performance objectives for Mr. Joyce.
2021 PROXY STATEMENT45
Target Bonus
|
| |||
President and Chief Executive Officer | 200% (during 2020 CEO tenure); 125% (during 2020 EVP tenure) |
| ||
Executive Vice President and CFO | 125% | Consisted of the degree of Danaher’s | ||
Executive Vice President | Consisted of the degree of year-over-year improvement in core revenue, |
businesses, strengthening senior leadership capacity and improving the Company’s digital-based innovation support. | ||
Angela S. Lalor Senior Vice President | ||
|
| Consisted of quantitative goals relating to internal hiring and associate engagement; and qualitative goals relating to diversity & inclusion, leadership recruitment, development and succession planning, associate engagement, enhancing the strength of the Company’s innovation and commercial organizations, the integration of the Cytiva business and improving the effectiveness of the human resources organization. | |||
Brian W. Ellis
|
| Consisted of qualitative goals related to diversity & inclusion, the Company’s government affairs function, the Company’s compliance and litigation-management programs and the Company’s intellectual property program and support for the Company’s innovation and growth objectives. | ||
William K. Daniel II Former Executive Vice President | 125% | Consisted of the degree of year-over-year improvement in core revenue, | ||
|
Determining Target Bonus Percentage.
DETERMINING TARGET BONUS PERCENTAGE
In determining the target bonus percentage for each NEO, the Committee considered the amount of annual cash incentive compensation awarded to the executive in prior years, the relative complexity and importance of the executive’s position and the amount of annual cash incentive compensation that peer companies would offer such executive. With respect to Mr.Messrs. Joyce and Blair in particular, in both cases although the Committee did not target the performance-based portion of histhe CEO’s annual cash compensation at any particular percentage of his annual cash compensation, the Committee strategically set histhe base salary at a level lower, and his target annual bonus opportunity at a level higher, than typical among the Company’s peer companies to help ensure that histhe CEO’s annual cash compensation is highly performance-based.
Determining Personal Payout Percentage.
DETERMINING PERSONAL PAYOUT PERCENTAGE
Following the end of 2017,2020, the Committee used its judgment and determined for each NEO a Personal Payout Percentage between 0% and 200%. The Committee believes that its ability to exercise discretion in connection with the annual executive bonus awards is an important element in reaching balanced compensation decisions that are consistent with our strategy and reward both current year performance and sustained long-term value creation. The Committee’s ability to exercise discretion:
• | helps mitigate the risks associated with a rigid and strictly formulaic compensation program, which could unintentionally create incentives for our executives to focus only on certain performance metrics or encourage imprudent risk taking; |
• | gives the Committee flexibility to address changes in economic conditions and our operating environment; and |
• | allows the Committee to adjust compensation based on factors that would not be appropriately reflected by a strictly formulaic approach based on Company performance, such as championing Danaher’s culture and values and recognition of individual performance levels. |
Without assigning any particular weight to any individual factor, the Committee took into account the executive’s execution against his or her personal performance objectives for the year, the executive’s performance with respect to each of the Company’s five “Leadership Anchors” (which are a set of standards and behaviors that Danaher associates are expected to aspire to and are
2021 PROXY STATEMENT46
assessed against), the executive’s overall performance for the year, the size of the Company Payout Percentage for the year, the amount of annual cash incentive compensation awarded to the executive in prior years and the amount of annual cash incentive compensation that peer companies typically pay to executives serving in comparable roles. Without limiting the foregoing, with respect to the executive officer team’s 2020 performance as a whole the Committee considered in particular the depth and comprehensiveness of support provided by Danaher to its workforce during the pandemic; the Company’s 2020 financial performance against the backdrop of the challenges posed by the COVID-19 pandemic; and the Company’s proactiveness during the year in identifying and executing upon opportunities to invest in the Company’s future financial and competitive positioning.
The Company awarded Mr. Blair a Personal Payout Percentage of 155% for 2020, based primarily on his leadership with respect to the Company’s response to the COVID-19 pandemic, the Company’s financial performance during his tenure, the actions taken by the Company to invest in future financial and competitive positioning, and the progress achieved with respect to the Cytiva integration. The Company awarded Mr. Joyce a Personal Payout Percentage of 129%155% for 2017,2020, based primarily on his 2017 leadership with respect to the Company’s response to the COVID-19 pandemic, the Company’s financial performance talent development, strategic allocationduring his 2020 tenure, the actions taken by the Company to invest in future financial and competitive positioning, and the successful closing of capital and strengtheningthe Cytiva acquisition. The average Personal Payout Percentage of our innovation capabilities.the other NEOs (who were serving as executive officers as of December 31, 2020) was 151%.
Company Payout Percentage
The Company Payout Percentage is formulaic, based on the Company’s 20172020 performance against the Adjusted EPS, Free Cash Flow Ratio and ROICCore Revenue Growth metrics described above and below and in Appendix A (the “Metrics”). The Committee weights Adjusted EPS most heavily in the formula because it believes Adjusted EPS correlates strongly with shareholder returns, particularly since Adjusted EPS is calculated in a manner that focuses on gains and charges the Committee believes are most directly related to Company operating performance during the period. The Committee also uses the Free Cash Flow Ratio to help validate the quality of the Company’s earnings, and ROICCore Revenue Growth to validate how efficientlyincentivize an appropriate balance between profitability and effectively the Company is investing its capital.growth.
For each of the Metrics, the Committee established threshold, target and maximum levels of Company performance, as well as a payout percentage curve that relatesrelated each level of performance to a payout based onexpressed as a percentage of target bonus. The payout percentage iswas 0% for below-threshold performance, and ranges from 50% for threshold performance toand ranged from 150% (for Free Cash Flow Ratio and ROIC) orRatio) to 200% (for Adjusted EPS)EPS and Core Revenue Growth) for performance that equalsequaled or exceedsexceeded the maximum. Under all Metrics, target performance yieldsyielded a payout percentage of 100%. The payout percentages for performance between threshold and target, or between target and maximum, respectively, arewere determined by linear interpolation.
In determining the target performance level and payout percentage curve for the Metrics, the Committee considered historical performance data for the Company and its peer group, analyst consensus earnings estimates for the Company’s peer group, the Company’s annual budget andmacroeconomic/end-market trends. For each Metric, the Committee set the performance target at a level it believes representsbelieved would represent attractive financial performance within our industry and is reasonably achievablewould require a high (but achievable) level of Company performance, while requiring what it believesbelieved would be outstanding performance to achieve the maximum payout level. The 2017 Adjusted EPS target was set within the 2017 Adjusted EPS guidance range provided to the Company’s investors at the beginning of 2017.
|
Following the end of 2017,2020, the Company Payout Percentage was calculated as follows:
2017 PERFORMANCE/PAYOUT MATRIX | ||||||||||
METRIC | TARGET LEVEL | ACTUAL PERFORMANCE LEVEL | PAYOUT % (BEFORE WEIGHTING) | METRIC WEIGHTING | WEIGHTED PAYOUT % | |||||
Adjusted EPS | $3.87 | $4.03 | 141.0% | 70% | 98.7% | |||||
Free Cash Flow Ratio | 103% | 102.7% | 99.3% | 20% | 19.9% | |||||
2016-2017 ROIC change | +50 basis points | +48 basis points | 99.3% | 10% | 9.9% | |||||
Company Payout Percentage | 129% (as rounded) |
2021 PROXY STATEMENT47
Composite Payout Percentage
The Company Payout Percentage and Personal Payout Percentage were calculated for each NEO, weighted accordingly and added to yield the officer’s Composite Payout Percentage. The Composite Payout Percentage was multiplied by the NEO’s target bonus amount to yield the executive’s award amount for the year. The 20172020 annual cash incentive compensation awards for each of the named executive officersNEOs are set forth in the Summary Compensation Table.
Base Salaries
The Committee typically reviews base salaries for executive officers in February of each year and in connection with promotions.promotions and new hires. In February 2017,2020, the Committee subjectively determined 20172020 base salaries for the named executive officers, as set forthNEOs and in May 2020, in connection with Mr. Blair’s and Mr. Weidemanis’ promotions, the Summary Compensation Table.Committee conducted a further review of their base salaries and adjusted them accordingly (Mr. Blair’s salary adjustment was effective upon his promotion). Without giving specific weight to any particular factor, in each case the Committee used the officer’s prior year’s base salary as the initial basis of consideration and then considered the individual factors described under "–“– Named Executive Officer Compensation Framework,” focusing on the relative complexity and importance of the executive’s role within Danaher, the market value of the executive’s role and the executive’s performance in the prior year. Given that base salary is one of the elements in the formula for determining annual cash incentive compensation, the Committee also considered how changes in base salary would impact annual cash incentive compensation.
Other Compensation
Severance Benefits.
We have entered into Proprietary Interest Agreements with each of our named executive officersNEOs that include post-employment restrictive covenant obligations and (except for Ms. Lalor and Mr. Blair) provide for severance payments under certain circumstances. Mr. Joyce’s agreement also provides for additional cash payments and the pro rata acceleration of the time-based vesting applicable to his outstanding equity awards if the Company terminates his employment without cause.obligations. Danaher’s Senior Leader Severance Pay Plan, which each of the named executive officersNEOs participates in, also provides for severance payments under certain circumstances. Mr. Blair’s Proprietary Interest Agreement entitles him to certain additional cash payments if the Company terminates his employment without cause, and the agreements entered into with each of Ms. Lalor and Mr. Ellis in connection with their hiring entitle them to enhanced severance payments under the Senior Leader Severance Pay Plan. We believe the post-employment restrictive covenant obligations included in these agreements are critical in protecting our proprietary assets, and that the severance payments payable upon a termination without cause are generally commensurate with the severance rights our peers offer executives in comparable roles.
EDIP. Each named executive officer participates There is no change-in-control provision in the AmendedSenior Leader Severance Pay Plan or in any NEO employment agreement.
In connection with the end of Mr. Daniel’s employment with Danaher in March 2020 and Restatedthe end of Mr. Joyce’s employment with Danaher Corporation & Subsidiaries Executive Deferred Incentive Program, or EDIP. The EDIP is a shareholder-approved,non-qualified, unfunded deferred compensation program available to selected members of our management;in February 2021, each officer qualified for a summary“early retirement” treatment under the terms of the plan,Omnibus Plan but received no severance benefits because such departures were voluntary; for more information, please see “Potential Payments Upon Termination or Change-of-Control as of 2020 Fiscal Year-End.”
EDIP, ECP and DCP
As discussed in more detail under “Summary of Employment Agreements and Plans – Supplemental Retirement Program,” each NEO (1) participates in either the Amended and Restated Executive Deferred Incentive Program.” We useProgram (“EDIP”), or the EDIPExcess Contribution Program (“ECP”), and (2) is eligible totax-effectively contribute amounts to executives’ retirement accounts and give our executives an opportunity to defer taxes on cash compensation and realizetax-deferred, market-based notional investment growth on their deferrals. The amount we contribute annually to the executives’ EDIP accounts is set at a level that we believe is competitive with comparable plans offered by other companies in our industry. EDIP participants do not fully vest in such amounts contributed by Danaher until they have participated participate in the program for 15 years or have reached age 55 with at least five years of service with Danaher.Deferred Compensation Plan (“DCP”):
• | The EDIP and ECP are each non-qualified, unfunded excess contribution programs available to selected members of our management. We use these programs to tax-effectively contribute amounts to executives’ and other participants’ retirement accounts and provide an opportunity to realize tax-deferred, market-based notional investment growth on these contributions. |
• | The DCP allows each participant to voluntarily defer, on a pre-tax basis, up to 85% of his or her salary and/or up to 85% of his or her non-equity incentive compensation with respect to a given plan year. The DCP gives our executives and other participants an opportunity to defer taxes on cash compensation and realize tax-deferred, market-based notional investment growth on their deferrals. |
Other Benefits and Perquisites.
All of our executives are eligible to participate in our U.S. employee benefit plans, including our group medical, dental, vision, disability, accidental death and dismemberment, life insurance, flexible spending and 401(k) plans. These plans are generally available to all U.S. salaried employees and do not discriminate in favor of executive officers. In addition, the Committee makes certain perquisites available to the named executive officers;NEOs; please see the footnotes to the Summary Compensation Table for additional details. The Committee has also adopted a policy prohibiting any tax reimbursement orgross-up provisions in our executive compensation program (except under a policy applicable to management employees generally such as a relocation policy).
2021 PROXY STATEMENT48
|
Named Executive Officer Compensation Framework
Danaher’s compensation program is grounded on the principle that each executive must consistently demonstrate exceptional personal performance in order to remain a Danaher executive. Within the framework of this principle and the other objectives discussed above, the Committee exercises its judgment in making executive compensation decisions. The factors that generally shape particular executive compensation decisions (none of which are assigned any particular weight by the Committee) are the following:
The philosophy and goals of our compensation program have remained consistent over time, although the Committee considers the factors above within the context of the then-prevailing economic environment and may adjust the terms and/or amounts of compensation accordingly so that they continue to support our objectives.
For a description of the role of the Company’s executives and the Committee’s independent compensation consultant in the executive compensation process, please see “Corporate Governance – Board of Directors and Committees of the Board – Compensation Committee.”
Peer Group Compensation Analysis
The Committee does not target a specific competitive position versus the market or peer companies in determining the compensation of our executives because in light of the Company’s diverse mix of businesses, strict targeting of a specified compensation posture would not appropriately reflect the unique nature of our business portfolio or the degree of difficulty in leading the Company and key functions. However, the Committee believes it is important to clearly understand the relevant market for executive talent to inform its decision-making and ensure that our executive compensation program supports our recruitment and retention needs and is fair and efficient. As a result, the Committee has worked with FW Cook to develop a peer group for purposes of assessing competitive compensation practices, and periodically reviews compensation data for the peer group derived from publicly filed proxy statements.
For 2017,
Executive Compensation Peer Group Prior To July 2020
Prior to July 2020, the Company’s peer group consisted of the following companies (the “peer companies”):set forth below, which is the same as the Company’s 2019 peer group:
3M Company | DowDuPont | Stryker Corporation | ||
Abbott Laboratories | Ecolab Inc. | Thermo Fisher Scientific Inc. | ||
Baxter International, Inc. | Honeywell International Inc. | United Technologies Corp. | ||
Becton Dickinson & Co. | Zimmer Biomet Holdings | |||
Boston Scientific Corporation |
|
The Committee selected companies for inclusion in this peer group based on (1) the extent to which they compete with us in one or more lines of business, for executive talent and for investors, and (2) comparability of revenues, market capitalization, net income, total assets and number of employees.
Executive Compensation Peer Group as of July 2020
The Committee periodically reviews the companies included in the peer group to ensure that the peer group remains appropriate. In July 2020, the Committee evaluated the existing peer group with the assistance of FW Cook (using the same selection criteria described above) and replaced DowDuPont, United Technologies and Zimmer Biomet with Amgen, Biogen, Illinois Tool Works and Johnson & Johnson. The Committee made these updates to the peer group to better reflect the Company’s current size and portfolio of businesses. The table below sets forth for this peer group and Danaher information regarding revenue, net income and total assets (based on the most recently reported four quarters for each company as of May 31, 2017)October 2, 2020), market capitalization (as of May 31, 2017)September 30, 2020) and employee headcount (based on each company’s most recent fiscal year end as of May 31, 2017)October 2, 2020), in each case derived from the Standard & Poor’s Capital IQ database.
Net Income (Before Unusual or | ||||||||||||||||||||||||||||||
($ IN MILLIONS)
| Market | Infrequently Occurring Items and | Employees at End of Last | |||||||||||||||||||||||||||
REVENUE
| MARKET
| NET INCOME (BEFORE UNUSUAL OR INFREQUENTLY DISCONTINUED OPERATIONS)
| TOTAL ASSETS
| EMPLOYEES AT
| ||||||||||||||||||||||||||
($ IN MILLIONS) | Revenue | Capitalization | Discontinued Operations) | Total Assets | Fiscal Year | |||||||||||||||||||||||||
75th percentile
| $
| 28,516
|
| $
| 92,688
|
| $
| 3,673
|
| $
| 52,638
|
|
| 84,750
|
| $29,640 | $144,275 | $5,108 | $64,308 | 93,082 | ||||||||||
Median
| $
| 15,981
|
| $
| 60,516
|
| $
| 1,771
|
| $
| 30,140
|
|
| 49,464
|
| $16,917 | $78,265 | $3,706 | $45,079 | 50,200 | ||||||||||
25th percentile
| $
| 10,644
|
| $
| 37,394
|
| $
| 1,268
|
| $
| 19,547
|
|
| 36,250
|
| $13,405 | $55,849 | $1,605 | $22,200 | 38,000 | ||||||||||
Danaher
| $
| 17,164
|
| $
| 58,959
|
| $
| 2,051
|
| $
| 45,245
|
|
| 62,000
|
| $19,733 | $152,757 | $3,047 | $72,891 | 60,000 | ||||||||||
Danaher percentile rank
|
| 52
| %
|
| 49
| %
|
| 59
| %
|
| 68
| %
|
| 64
| %
| |||||||||||||||
DANAHER PERCENTILE RANK | 53% | 79% | 43% | 87% | 54% |
The peer group compensation data that the Committee reviewed in 20172020 in connection with its executive compensation decisions estimated the 25th, median and 75thpercentile positions among our peers with respect to base salary, annual cash incentive compensation (target and actual), total annual cash compensation (target and actual), long-term incentive compensation, total direct compensation (target and actual), all other compensation, annual change in pension value and above-market interest onnon-qualified deferred compensation, and actual total compensation, in each case with respect to each respective namedNEO position.
2021 PROXY STATEMENT49
Named Executive Officer Compensation Framework
Danaher’s compensation program is grounded on the principle that each executive officermust consistently demonstrate exceptional personal performance in order to remain a Danaher executive. Within the framework of this principle and the other objectives discussed above, the Committee exercises its judgment in making executive compensation decisions. The factors that generally shape particular executive compensation decisions (none of which are assigned any particular weight by the Committee) are the following:
• | The relative complexity and importance of the executive’s position within Danaher.To ensure that the most senior executives are held most accountable for long-term operating results and changes in shareholder value, the Committee believes that both the amount and “at-risk” nature of compensation should increase with the relative complexity and significance of an executive’s position. |
• | The executive’s record of performance, long-term leadership potential and tenure. |
• | Danaher’s performance.Our cash incentive compensation varies annually to reflect near-term changes in operating and financial results. Our long-term compensation is closely aligned with long-term shareholder value creation, both by tying the ultimate value of the awards to long-term shareholder returns and because of the length of time executives are required to hold the awards before realizing their value. |
• | Our assessment of pay levels and practices in the competitive marketplace.The Committee considers market practice in determining pay levels and compensation design to ensure that our costs are sustainable relative to peers and compensation is appropriately positioned to attract and retain talented executives. As noted above, the market for executive-level talent is highly competitive. We also have a history of successfully applying the Danaher Business System, or DBS, to deliver strong operating performance and create shareholder value, and we devote significant resources to training our executives in DBS. As a result of these factors, we believe that our executives are particularly valued by other companies, which creates a high degree of retention risk. |
The philosophy and goals of our compensation program have remained consistent over time, although the Committee considers the factors above within the context of the then-prevailing economic environment and may adjust the terms and/or amounts of compensation accordingly so that they continue to support our objectives.
For a description of the role of the Company’s executives and the Committee’s independent compensation consultant in the executive compensation process, please see “Corporate Governance – Board of Directors and Committees of the Board –Compensation Committee.”
Other Compensation Policies and Information
Long-Term Incentive Compensation Grant Practices
General
The Committee grants equity awards under Danaher’s Omnibus Plan, which is described in “Summary of Employment Agreements and Plans – 2007 Omnibus Incentive Plan.” Executive equity awards are approved at regularly scheduled Committee meetings (typically scheduled in advance of the calendar year in which they occur), at the time of an executive hire or promotion or upon identification of a specific retention concern. The grant date of equity awards approved by the Committee is either the date of Committee approval or a date subsequent to the approval date as specified by the Committee. The timing of equity awards has not been coordinated with the release of materialnon-public information. The Committee’s general practice is to approve annual equity awards to executives at the Committee’s regularly scheduled meeting in February, when the Committee reviews the performance of the executive officers and typically determines the other components of executive compensation.
PSUs and RSUs
The target dollar value attributable to PSUs and RSUs, isas applicable, has been translated into a target number of PSUs andor RSUs, respectively,as applicable, using a fair market value equal to the average closing price over a twentytrading-day period, ending on the grant date (the “Averaging Period Closing Price”), to avoid the potential volatility impact of using asingle-day closing price. Since this valuation methodology is notPrior to 2021, the same as the FASB ASC Topic 718 grant date fair value used for accounting purposes, the PSU/RSU target dollar value is not the same as the PSU/RSU grant date fair value reflected in the Summary Compensation Table.
Stock Options
The target dollar value attributable to stock options iswas translated into a number of stock options based on (1) a fair market value equalmodified Black Scholes calculation that utilized a multi-day average closing price and an assumed ten-year term. With respect to the Averaging Period Closing Price forequity awards approved in February 2021, the particular grant date and (2) themodified Black Scholes value of an option as ofwas replaced with the first grant date ofactual Black Scholes value used in the calendar year (but usingCompany’s financial statements with respect to the full10-year term of the option as the assumed life).particular grant. The exercise price for stock option awards granted under the Omnibus Plan equals the closing price of Danaher’s Common Stock on the date of grant.grant (or on the immediately preceding trading day if the date of grant is not a trading day). Since the valuation methodologies used in 2020 are not the same as the FASB ASC Topic 718 grant date fair value used for accounting purposes, the equity award target dollar values are not identical to the equity award grant date fair values reflected in the Summary Compensation Table and other compensation tables.
2021 PROXY STATEMENT50
|
Stock Ownership-Related Policies
Stock Ownership Requirements
To further align management and shareholder interests and discourage inappropriate or excessive risk-taking, our stock ownership policy requires each executive officer to obtain a substantial equity stake in Danaher within five years of his or her appointment to an executive position, as follows:
Title | Stock Ownership Multiple | |
Chief Executive Officer | 5 times base salary | |
Executive Vice President | 3 times base salary | |
Senior Vice President | 2 times base salary |
|
| |||
• | Shares in which the executive or his or her spouse or child has a direct or indirect interest | • | Unexercised stock options | |
• | Notional shares of Danaher stock in the EDIP, ECP or DCP | |||
• | Shares held in a 401(k) plan | |||
• | Unvested RSUs/PSUs (based on target number of shares until vested and then based on the actual number of vested shares) |
|
Once an executive officer has acquired a number of Company shares that satisfies the applicable ownership multiple, then applicable to him or her, such number of shares then becomes his or herthe officer’s minimum ownership requirement (even if the officer’s salary increases or the fair market value of such shares subsequently changes) until he or shethe officer is promoted to a higher level. Each named executive officerNEO serving as an executive officer as of December 31, 20172020 was in compliance with the stock ownership requirements as of such date.
Pledging Policy
Danaher’s Board has adopted a policy that prohibits any director or executive officer from pledging as security under any obligation any shares of Danaher Common Stock that hethe director or sheofficer directly or indirectly owns and controls (other than shares already pledged as of February 21, 2013)the date the policy was adopted), and provides that pledged shares of Danaher Common Stock do not count toward Danaher’s stock ownership requirements. No named executive officerNEO has pledged any shares of Danaher Common Stock.
Hedging Policy
Under our insider trading policy, Danaher policy prohibits Danaherdirectors and employees (including the named executive officers) and directorsare prohibited from engaging in anyshort sales of Danaher Common Stock, transactions involving ain any derivative of a Danaher security including(including, but not limited to, buying or selling puts, calls or other options (except for instruments granted under a Danaher equity compensation plan)) or any other forms of hedging transactions.transactions with respect to Danaher securities.
Recoupment Policy
To further discourage inappropriate or excessive risk-taking, the Committee has adopted a rigorous, “no-fault” recoupment (or clawback) policy applicable to Danaher’s executive officers, other individuals who serve on the Danaher Leadership Team (which consists primarily of Company corporate officers) and certain other employees (the “covered persons”). Under the policy, in the event of a material restatement of Danaher’s consolidated financial statements (other than any restatement required pursuant to a change in applicable accounting rules), Danaher’s Board may, to the extent permitted by law and to the extent it determines that it is in Danaher’s best interests to do so, in addition to all other remedies available to Danaher require reimbursement or payment to Danaher of:
• | the portion of any annual incentive compensation payment awarded to any covered person within the three year period prior to the date such material restatement is first publicly disclosed that would not have been awarded had the consolidated financial statements that are the subject of such restatement been correctly stated (except that the Board has the right to require reimbursement of the entire amount of any such annual incentive compensation payment from any covered person whose fraud or other intentional misconduct in the Board’s judgment alone or with others caused such restatement); and | |
• |
|
2021 PROXY STATEMENT51
In addition, the stock plans in which Danaher’s executive officers participate contain provisions for recovering awards upon certain circumstances. Under the terms of the Company’s Omnibus Plan, if an associate is prohibited from exercising outstanding equity awards after such time he or sheemployee is terminated for gross misconduct.misconduct, the administrator may terminate up to all of the participant’s unexercised or unvested equity awards. In addition, under the terms of each of the EDIP and the ECP, if the administrator determines that the circumstances of a participant’s termination of an employee’s participation in the EDIP resulted from the employee’sconstitute gross misconduct, the administrator may determine that the employee’sparticipant’s vesting percentage is as low as zero with respect to all balances that were contributed by Danaher.
Regulatory Considerations
Section 162(m) generally disallows a tax deduction to public corporations for compensation in excess of $1 million paid for any fiscal year to certain executive officers. The exemption from Section 162(m)’s deduction limit for performance-based compensation has been repealed, effective for taxable years beginning after December 31, 2017, such that compensation paid to our covered executive officers in excess of $1 million willis not be deductible unless it qualifies for transition relief applicable to certain arrangements in place as of November 2, 2017.
We review the tax impact of our executive compensation on the Company as well as on the executive officers. In addition, we review the impact of our compensation programs against other considerations, such as accounting impact, shareholder alignment, market competitiveness, effectiveness and perceived value to employees. Because many different factors influence a well-rounded, comprehensive and effective executive compensation program, some of the compensation we provide to our executive officers is not deductible under Section 162(m).
COMPENSATION COMMITTEE REPORTCompensation Committee Report
This report is not deemed to be “soliciting material” or to be “filed” with the SEC or subject to the SEC’s proxy rules or to the liabilities of Section 18 of the Securities Exchange Act of 1934, and shall not be deemed to be incorporated by reference into any prior or subsequent filing by Danaher under the Securities Act of 1933 or the Securities Exchange Act of 1934, except to the extent Danaher specifically incorporates this report by reference therein.
The Compensation Committee of Danaher Corporation’s Board has reviewed and discussed with management the Compensation Discussion and Analysis set forth above and, based on such review and discussion, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis be included in this Proxy Statement.
Compensation Committee of the Board of Directors
Donald J. Ehrlich
Alan G. Spoon (Chair)
Teri List
Walter G. Lohr, Jr.
Alan G. Spoon
2021 PROXY STATEMENT52
COMPENSATION TABLES AND INFORMATION
2017
2020 Summary Compensation Table
The following table sets forth the 20172020 compensation of our(i) the two individuals who served in the role of President and Chief Executive Officer in 2020, (ii) our Executive Vice President and Chief Financial Officer, and(iii) our three other most highly compensated executive officers who were serving as executive officers as of December 31, 2017, also2020, and (iv) an additional individual for whom disclosure would have been required under subsection (iii) of this sentence but for the fact that the individual was no longer serving as an executive officer as of December 31, 2020, known as our “named executive officers.”
NAME AND PRINCIPAL POSITION | YEAR | SALARY ($)(1) | BONUS ($) | STOCK ($)(2) | OPTION AWARDS ($)(2) | NON-EQUITY ($)(1) | CHANGE IN DEFERRED ($)(3) | ALL OTHER ($)(4) | TOTAL ($) | |||||||||||||||||||||||||||
Thomas P. Joyce,Jr. President and CEO | 2017 | $ | 1,200,000 | 0 | $ | 5,559,897 | $ | 4,413,654 | $ | 3,100,000 | $ | 6,863 | $ | 505,927 | $ | 14,786,341 | ||||||||||||||||||||
2016 | $ | 1,100,000 | 0 | $ | 4,095,424 | $ | 3,762,923 | $ | 3,500,000 | $ | 11,867 | $ | 498,587 | $ | 12,968,801 | |||||||||||||||||||||
2015 | $ | 1,000,000 | 0 | $ | 3,473,408 | $ | 3,048,142 | $ | 2,600,000 | $ | 4,392 | $ | 469,606 | $ | 10,595,548 | |||||||||||||||||||||
Daniel L. Comas, Executive Vice President and CFO | 2017 | $ | 905,476 | 0 | $ | 2,168,648 | $ | 1,721,412 | $ | 1,600,000 | $ | 5,203 | $ | 294,764 | $ | 6,695,503 | ||||||||||||||||||||
2016 | $ | 862,357 | 0 | $ | 1,830,931 | $ | 1,682,232 | $ | 1,666,505 | $ | 9,196 | $ | 271,662 | $ | 6,322,883 | |||||||||||||||||||||
2015 | $ | 821,400 | 0 | $ | 1,786,736 | $ | 1,567,665 | $ | 1,402,541 | $ | 2,773 | $ | 265,398 | $ | 5,846,513 | |||||||||||||||||||||
Rainer M. Blair, Executive Vice President | 2017 | $ | 625,000 | 0 | $ | 1,390,207 | $ | 1,103,517 | $ | 1,000,000 | 0 | $ | 112,539 | $ | 4,231,263 | |||||||||||||||||||||
William K. Daniel II, Executive Vice President | 2017 | $ | 773,953 | 0 | $ | 1,946,104 | $ | 1,544,841 | $ | 1,300,000 | 0 | $ | 165,556 | $ | 5,730,454 | |||||||||||||||||||||
2016 | $ | 730,144 | 0 | $ | 1,589,854 | $ | 1,460,842 | $ | 1,337,989 | 0 | $ | 110,968 | $ | 5,229,797 | ||||||||||||||||||||||
2015 | $ | 682,500 | 0 | $ | 1,538,272 | $ | 1,350,063 | $ | 1,076,644 | 0 | $ | 106,580 | $ | 4,754,059 | ||||||||||||||||||||||
Angela S. Lalor, Senior Vice President-HR | 2017 | $ | 634,185 | 0 | $ | 1,167,663 | $ | 926,946 | $ | 1,050,000 | 0 | $ | 120,285 | $ | 3,899,079 | |||||||||||||||||||||
2016 | $ | 603,986 | $ | 300,000 | (5) | $ | 867,250 | $ | 796,901 | $ | 1,013,851 | 0 | $ | 91,318 | $ | 3,673,306 | ||||||||||||||||||||
2015 | $ | 575,300 | $ | 300,000 | (5) | $ | 794,576 | $ | 560,024 | $ | 823,945 | 0 | $ | 99,240 | $ | 3,153,085 |
Name and Principal Position | Year | Salary ($)(1) | Bonus ($) | Stock Awards ($)(2) | Option Awards ($)(2) | Non-Equity Incentive Plan Compensation ($)(1) | Change in Pension Value and Nonqualified Deferred Compensation Earnings ($)(3) | All Other Compensation ($)(4) | Total ($) | |||||||||||||||||||||||||||
Rainer M. Blair | 2020 | $ | 949,067 | $ | 0 | $ | 3,616,939 | $ | 2,968,651 | $ | 2,519,339 | $ | 0 | $ | 342,765 | $ | 10,396,761 | |||||||||||||||||||
President and CEO | 2019 | 840,000 | 0 | 2,565,951 | 2,053,766 | 1,589,700 | 0 | 129,232 | 7,178,649 | |||||||||||||||||||||||||||
2018 | 700,000 | 0 | 1,655,066 | 1,343,570 | 1,275,750 | 0 | 114,981 | 5,089,367 | ||||||||||||||||||||||||||||
Matthew R. McGrew, | 2020 | 726,000 | 0 | 1,637,982 | 1,435,173 | 1,564,530 | 0 | 166,358 | 5,530,043 | |||||||||||||||||||||||||||
Executive Vice President and CFO | 2019 | 660,000 | 0 | 1,483,078 | 1,186,634 | 1,103,586 | 0 | 152,646 | 4,585,944 | |||||||||||||||||||||||||||
Joakim Weidemanis, | 2020 | 881,560 | 0 | 5,065,095 | 4,551,242 | 1,917,000 | 0 | 138,301 | 12,553,198 | |||||||||||||||||||||||||||
Executive Vice President | 2019 | 759,000 | 0 | 2,280,985 | 1,825,639 | 1,379,483 | 0 | 119,872 | 6,364,979 | |||||||||||||||||||||||||||
2018 | 660,000 | 0 | 1,434,246 | 1,164,350 | 1,076,262 | 0 | 104,496 | 4,439,354 | ||||||||||||||||||||||||||||
Angela S. Lalor, | ||||||||||||||||||||||||||||||||||||
Senior Vice President-Human Resources | 2020 | 727,157 | 800,000 | (5) | 1,276,951 | 1,118,710 | 1,458,386 | 0 | 121,041 | 5,502,245 | ||||||||||||||||||||||||||
Brian W. Ellis, | ||||||||||||||||||||||||||||||||||||
Senior Vice President-General Counsel | 2020 | 636,522 | 0 | 867,259 | 760,023 | 1,218,048 | 0 | 78,980 | 3,560,832 | |||||||||||||||||||||||||||
Thomas P. Joyce, Jr. | 2020 | 1,352,000 | 0 | 6,260,748 | 5,487,776 | 3,107,797 | 6,470 | 549,165 | 16,763,956 | |||||||||||||||||||||||||||
Former President and CEO | 2019 | 1,300,000 | 0 | 6,842,328 | 5,476,607 | 4,000,000 | 8,495 | 565,770 | 18,193,200 | |||||||||||||||||||||||||||
2018 | 1,236,000 | 0 | 5,516,165 | 4,478,180 | 3,604,176 | 0 | 526,520 | 15,361,041 | ||||||||||||||||||||||||||||
William K. Daniel II, | 2020 | 286,116 | 0 | 2,553,117 | 2,237,419 | 462,882 | 0 | 203,265 | 5,742,799 | |||||||||||||||||||||||||||
Former Executive Vice President | 2019 | 934,548 | 0 | 2,851,544 | 2,282,204 | 1,745,268 | 0 | 272,676 | 8,086,240 | |||||||||||||||||||||||||||
2018 | 812,650 | 0 | 2,068,562 | 1,679,390 | 1,440,423 | 0 | 173,668 | 6,174,693 |
(1) | The following table sets forth the amount, if any, of salary and/ornon-equity incentive compensation that each named executive officer deferred into the EDIP and/or DCP with respect to each of the years reported above: |
NAME OF OFFICER | AMOUNT OF SALARY DEFERRED INTO EDIP ($) | AMOUNT OF NON-EQUITY INCENTIVE COMPENSATION DEFERRED | ||||||||||||||||||||||||||
2017 | 2016 | 2015 | 2017 | 2016 | 2015 | |||||||||||||||||||||||
Thomas P. Joyce, Jr. | $ | 299,038 | $ | 274,135 | $ | 200,000 | $ | 775,000 | $ | 875,000 | $ | 520,000 | ||||||||||||||||
Daniel L. Comas | - | - | - | - | - | - | ||||||||||||||||||||||
Rainer M. Blair | - | N/A | N/A | - | N/A | N/A | ||||||||||||||||||||||
William K. Daniel II | $ | 115,840 | $ | 109,274 | $ | 102,375 | - | - | - | |||||||||||||||||||
Angela S. Lalor | - | - | - | - | $ | 506,926 | $ | 411,973 |
Amount of Salary Deferred Into EDIP/DCP ($) | Amount of Non-Equity Incentive Compensation Deferred Into EDIP/DCP ($) | |||||||||||
2020 | 2019 | 2018 | 2020 | 2019 | 2018 | |||||||
Rainer M. Blair |
– | – | – | – | – | ||||||||
Matthew R. McGrew | – | – | N/A | – | N/A | |||||||
| – | – | – | 275,897 | 322,879 | |||||||
Angela S. Lalor | 37,692 | N/A | N/A | N/A | N/A | |||||||
Brian W. Ellis | – | N/A | N/A | N/A | N/A | |||||||
Thomas P. Joyce, Jr. | 350,400 | 324,323 | 308,654 | – | 901,044 | |||||||
William K. Daniel II | – | 139,409 | 121,674 | – | 436,317 | 360,106 |
2021 PROXY STATEMENT 53
(2) | The amounts reflected in these columns represent the aggregate grant date fair value computed in accordance with FASB ASC Topic 718 for equity grants made in the applicable year: |
• | With respect to stock options, the grant date fair value under FASB ASC Topic 718 has been calculated using the Black-Scholes option pricing model, based on the following assumptions (and assuming no forfeitures): |
NAME OF OFFICER | DATE OF GRANT | RISK-FREE INTEREST | STOCK PRICE VOLATILITY RATE | DIVIDEND YIELD | OPTION LIFE | |||||||||||||
Joyce, Comas, Blair, Daniel, Lalor | February 24, 2017 | 2.18 | % | 18.18 | % | 0.65 | % | 8.0 years | ||||||||||
Joyce, Comas, Daniel, Lalor | February 24, 2016 | 1.60 | % | 24.70 | % | 0.62 | % | 8.0 years | ||||||||||
Joyce, Comas, Daniel | February 24, 2015 | 1.86 | % | 23.40 | % | 0.62 | % | 8.0 years | ||||||||||
Lalor | February 24, 2015 | 1.55 | % | 23.20 | % | 0.62 | % | 5.5 years |
ASSUMPTION | 2017 | 2016 | ||||||||||||||||||||||
MONTE CARLO SIMULATION | ILLIQUIDITY DISCOUNT | MONTE CARLO SIMULATION | ILLIQUIDITY DISCOUNT | |||||||||||||||||||||
Danaher’s expected volatility | 16.27 | % | 16.91 | % | 17.16 | % | 20.67 | % | ||||||||||||||||
Average volatility of peer group | 25.49 | % | N/A | 25.02 | % | N/A | ||||||||||||||||||
Risk free interest rate | 1.34 | % | 1.12 | % | 0.88 | % | 0.75 | % | ||||||||||||||||
Dividend yield | 0 | % | 0.58 | % | 0 | % | 0.62 | % |
Risk-Free | Stock Price | Dividend | Option | |||||||
Name of Officer | Date of Grant | Interest Rate | Volatility Rate | Yield | Life | |||||
Blair, Weidemanis | May 15, 2020 | 0.54% | 30.49% | 0.44% | 8.0 years | |||||
Blair, McGrew, Weidemanis, Lalor, Ellis, Joyce, Daniel | February 24, 2020 | 1.33% | 23.09% | 0.46% | 8.0 years | |||||
Joyce, McGrew, Blair, Daniel, Weidemanis | February 24, 2019 | 2.58% | 19.88% | 0.56% | 8.0 years | |||||
Joyce, Blair, Daniel, Weidemanis | February 24, 2018 | 2.82% | 21.52% | 0.63% | 8.0 years |
In 2019 and 2020, with respect to each executive officer’s annual equity award (and Mr. Blair’s May 2020 incremental equity award), one-half of the award was granted in the form of stock options, and one-half was granted in the form of performance stock units (PSUs); Mr. Weidemanis’ May 2020 incremental equity award was granted one-half in the form of stock options and one-half in the form of time-vesting restricted stock units (RSUs). In 2018, one-quarter of each executive officer’s annual equity award was granted in the form of restricted stock units (RSUs), one-quarter was granted in the form of PSUs and one-half was granted in the form of stock options. With respect to RSUs, the grant date fair value under FASB ASC Topic 718 was calculated based on the number of shares of Common Stock underlying the RSU, times the closing price of the Common Stock on the date of grant (but discounted to account for the fact that RSUs do not accrue dividend rights prior to vesting and distribution). With respect to PSUs, the grant date fair value under FASB ASC Topic 718 has been calculated based on the probable outcome of the applicable |
Monte Carlo Simulation | Illiquidity discount | |||||||||||||||
Name of Officer | Date of Grant | Danaher’s expected volatility | Average volatility of peer group | Risk-free interest rate | Dividend yield | Danaher’s expected volatility | Risk-free interest rate | Dividend yield | ||||||||
Blair | May 15, 2020 | 25.39% | 36.96% | 0.18% | 0% | 27.13% | 0.16% | 0.44% | ||||||||
Blair, McGrew, Weidemanis, Lalor, Ellis, Joyce, Daniel | February 24, 2020 | 19.06% | 25.27% | 1.21% | 0% | 20.46% | 1.26% | 0.46% | ||||||||
Blair, McGrew, Weidemanis, Joyce, Daniel | February 24, 2019 | 16.97% | 24.97% | 2.45% | 0% | 17.02% | 2.46% | 0.56% | ||||||||
Blair, McGrew, Weidemanis, Joyce, Daniel | February 24, 2018 | 16.15% | 25.22% | 2.34% | 0% | 16.26% | 2.24% | 0.56% |
(3) | The amount set forth in this column |
(4) | The following table describes |
NAME | COMPANY 401(K) CONTRIBUTIONS ($) | COMPANY EDIP CONTRIBUTIONS ($) | OTHER ($) | TOTAL 2017 ALL OTHER COMPENSATION ($) | ||||||||||
Thomas P. Joyce, Jr. | $19,130 | $ | 330,000 | $ | 156,797 | (a) | $505,927 | |||||||
Daniel L. Comas | $19,130 | $ | 194,030 | $ | 81,604 | (b) | $294,764 | |||||||
Rainer M. Blair | $19,130 | $ | 59,305 | $ | 34,104 | (c) | $112,539 | |||||||
William K. Daniel II | $19,130 | $ | 131,426 | $ | 15,000 | (d) | $165,556 | |||||||
Angela S. Lalor | $19,130 | $ | 76,102 | $ | 25,053 | (e) | $120,285 |
Name | Company 401(k) Contributions ($) | Company EDIP/ECP Contributions ($) | Other ($) | Total 2020 All Other Compensation ($) | ||||
Rainer M. Blair | 20,046 | 113,400 | 209,319(a) | 342,765 | ||||
Matthew R. McGrew | 20,046 | 85,140 | 61,172(b) | 166,358 | ||||
Joakim Weidemanis | 20,046 | 102,465 | 15,790(c) | 138,301 | ||||
Angela S. Lalor | 20,046 | 80,956 | 20,039(d) | 121,041 | ||||
Brian W. Ellis | 20,046 | 39,411 | 19,523(e) | 78,980 | ||||
Thomas P. Joyce, Jr. | 20,046 | 390,000 | 139,119(f) | 549,165 | ||||
William K. Daniel II | 20,046 | 168,219 | 15,000(g) | 203,265 |
(a) | Includes |
|
fuel,on-board catering, maintenance expenses related to operation of the plane during the year, landing and parking fees, navigation fees, related ground transportation, crew accommodations and meals and supplies) per flight hour for the particular aircraft for the year, net of any applicable employee reimbursement. Since the aircraft |
2021 PROXY STATEMENT54
(b) | Includes | |
(c) | Consists of amounts related to tax preparation/professional services. | |
(d) | Consists of amounts related to tax preparation/professional services, tickets to entertainment events and parking expenses. | |
(e) | Consists of amounts related to tax preparation/professional services and parking expenses. | |
(f) | Includes $122,199 relating to personal use of the Company’s aircraft plus amounts related to tax preparation/professional services, parking expenses and an annual physical exam. The incremental cost to the Company of the personal aircraft use is calculated in the same manner as set forth in Footnote 4(a) above. Mr. |
Consists of amounts related to tax preparation/professional |
(5) | Represents a |
the agreement she entered into with the Company in connection with her hiring in 2012. For |
2021 PROXY STATEMENT55
Grants of Plan-Based Awards for Fiscal 20172020
The following table sets forth certain information regarding grants of plan-based awards to each of our named executive officers in 2017.2020.
COMMITTEE APPROVAL DATE | ESTIMATED POSSIBLE PAYOUTS UNDER NON-EQUITY INCENTIVE PLAN AWARDS(1) | ESTIMATED FUTURE PAYOUTS UNDER EQUITY INCENTIVE PLAN AWARDS(2) | ALL OTHER OPTION AWARDS: NUMBER OF SECURITIES UNDERLYING OPTIONS (#) (2) | EXERCISE OR BASE PRICE OF OPTION AWARDS ($/ SHARE) | GRANT DATE FAIR VALUE OF STOCK AND OPTION AWARDS ($) (3) | |||||||||||||||||||||||||||||||||||||||||
NAME | GRANT DATE | THRESHOLD ($) | TARGET ($) | MAXIMUM ($) | THRESHOLD (#) | TARGET (#) | MAXIMUM (#) | |||||||||||||||||||||||||||||||||||||||
Thomas P. Joyce, Jr. | Annual cash incentive compensation | 2/21/2017 | 2/21/2017 | $ | 1,200,000 | $ | 2,400,000 | $ | 10,000,000 | (4) | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
Stock options(5) | 2/24/2017 | 2/21/2017 | - | - | - | - | - | - | 213,220 | $ | 86.08 | $ | 4,413,654 | |||||||||||||||||||||||||||||||||
Restricted stock units(6) | 2/24/2017 | 2/21/2017 | - | - | - | - | 29,855 | - | - | - | $ | 2,527,226 | ||||||||||||||||||||||||||||||||||
Performance stock units(7) | 2/24/2017 | 2/21/2017 | - | - | - | 7,464 | 29,855 | 59,710 | - | - | $ | 3,032,671 | ||||||||||||||||||||||||||||||||||
Daniel L. Comas | Annual cash incentive compensation | 2/21/2017 | 2/21/2017 | $ | 565,922 | $ | 1,131,844 | $ | 10,000,000 | (4) | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
Stock options(5) | 2/24/2017 | 2/21/2017 | - | - | - | - | - | - | 83,160 | $ | 86.08 | $ | 1,721,412 | |||||||||||||||||||||||||||||||||
Restricted stock units(6) | 2/24/2017 | 2/21/2017 | - | - | - | - | 11,645 | - | - | - | $ | 985,749 | ||||||||||||||||||||||||||||||||||
Performance stock units(7) | 2/24/2017 | 2/21/2017 | - | - | - | 2,911 | 11,645 | 23,290 | - | - | $ | 1,182,899 | ||||||||||||||||||||||||||||||||||
Rainer M. Blair | Annual cash incentive compensation | 2/21/2017 | 2/21/2017 | $ | 359,375 | $ | 718,750 | $ | 10,000,000 | (4) | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
Stock options(5) | 2/24/2017 | 2/21/2017 | - | - | - | - | - | - | 53,310 | $ | 86.08 | $ | 1,103,517 | |||||||||||||||||||||||||||||||||
Restricted stock units(6) | 2/24/2017 | 2/21/2017 | - | - | - | - | 7,465 | - | - | - | $ | 631,912 | ||||||||||||||||||||||||||||||||||
Performance stock units(7) | 2/24/2017 | 2/21/2017 | - | - | - | 1,866 | 7,465 | 14,930 | - | - | $ | 758,295 | ||||||||||||||||||||||||||||||||||
William K. Daniel II | Annual cash incentive compensation | 2/21/2017 | 2/21/2017 | $ | 483,721 | $ | 967,441 | $ | 10,000,000 | (4) | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
Stock options(5) | 2/24/2017 | 2/21/2017 | - | - | - | - | - | - | 74,630 | $ | 86.08 | $ | 1,544,841 | |||||||||||||||||||||||||||||||||
Restricted stock units(6) | 2/24/2017 | 2/21/2017 | - | - | - | - | 10,450 | - | - | - | $ | 884,593 | ||||||||||||||||||||||||||||||||||
Performance stock units(7) | 2/24/2017 | 2/21/2017 | - | - | - | 2,613 | 10,450 | 20,900 | - | - | $ | 1,061,511 | ||||||||||||||||||||||||||||||||||
Angela S. Lalor | Annual cash incentive compensation | 2/21/2017 | 2/21/2017 | $ | 364,657 | $ | 729,313 | $ | 10,000,000 | (4) | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
Stock options(8) | 2/24/2017 | 2/21/2017 | - | - | - | - | - | - | 44,780 | $ | 86.08 | $ | 926,946 | |||||||||||||||||||||||||||||||||
Restricted stock units(9) | 2/24/2017 | 2/21/2017 | - | - | - | - | 6,270 | - | - | - | $ | 530,756 | ||||||||||||||||||||||||||||||||||
Performance stock units(7) | 2/24/2017 | 2/21/2017 | - | - | - | 1,568 | 6,270 | 12,540 | - | - | $ | 636,907 |
Estimated Possible Payouts Under Non-Equity Incentive Plan Awards(1) | Estimated Future Payouts Under Equity Incentive Plan Awards(2) | All other Option Awards: | Grant Date Fair | |||||||||||||||||||||||||||||||||||||||
Name | Grant Date | Committee Approval Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | Number of Securities Underlying Options (#)(2) | Exercise or Base Price of Option Awards ($/Share) | Value of stock And Option Awards ($)(3) | |||||||||||||||||||||||||||||||
Rainer M. Blair | Annual cash incentive | |||||||||||||||||||||||||||||||||||||||||
compensation | 2/20/2020 | 2/20/2020 | $ | 731,036 | $ | 1,462,072 | $ | 2,836,420 | – | – | – | – | – | – | ||||||||||||||||||||||||||||
Stock options(4) | 2/24/2020 | 2/20/2020 | – | – | – | – | – | – | 47,510 | $ | 156.82 | $ | 2,026,302 | |||||||||||||||||||||||||||||
Performance stock | ||||||||||||||||||||||||||||||||||||||||||
units(5) | 2/24/2020 | 2/20/2020 | – | – | – | 3,683 | 14,730 | 29,460 | – | – | $ | 2,312,168 | ||||||||||||||||||||||||||||||
Stock options(4) | 5/15/2020 | 5/5/2020 | – | – | – | – | – | – | 17,710 | $ | 163.85 | $ | 942,349 | |||||||||||||||||||||||||||||
Performance stock | ||||||||||||||||||||||||||||||||||||||||||
units(5) | 5/15/2020 | 5/5/2020 | – | – | – | 1,594 | 6,375 | 12,750 | – | – | $ | 1,304,771 | ||||||||||||||||||||||||||||||
Matthew R. McGrew | Annual cash incentive | |||||||||||||||||||||||||||||||||||||||||
compensation | 2/20/2020 | 2/20/2020 | $ | 453,750 | $ | 907,500 | $ | 1,760,550 | – | – | – | – | – | – | ||||||||||||||||||||||||||||
Stock options(4) | 2/24/2020 | 2/20/2020 | – | – | – | – | – | – | 33,650 | $ | 156.82 | $ | 1,435,173 | |||||||||||||||||||||||||||||
Performance stock | ||||||||||||||||||||||||||||||||||||||||||
units(5) | 2/24/2020 | 2/20/2020 | – | – | – | 2,608 | 10,435 | 20,870 | – | – | $ | 1,637,982 | ||||||||||||||||||||||||||||||
Joakim Weidemanis | Annual cash incentive | |||||||||||||||||||||||||||||||||||||||||
compensation | 2/20/2020 | 2/20/2020 | $ | 551,160 | $ | 1,102,319 | $ | 2,138,499 | – | – | – | – | – | – | ||||||||||||||||||||||||||||
Stock options(4) | 2/24/2020 | 2/20/2020 | – | – | – | – | – | – | 42,560 | $ | 156.82 | $ | 1,815,184 | |||||||||||||||||||||||||||||
Performance stock | ||||||||||||||||||||||||||||||||||||||||||
units(5) | 2/24/2020 | 2/20/2020 | – | – | – | 3,299 | 13,195 | 26,390 | – | – | $ | 2,071,219 | ||||||||||||||||||||||||||||||
Stock options(6) | 5/15/2020 | 5/5/2020 | – | – | – | – | – | – | 51,420 | $ | 163.85 | $ | 2,736,058 | |||||||||||||||||||||||||||||
Restricted stock | ||||||||||||||||||||||||||||||||||||||||||
units(7) | 5/15/2020 | 5/5/2020 | – | – | – | – | 18,515 | – | – | – | $ | 2,993,876 | ||||||||||||||||||||||||||||||
Angela S. Lalor | Annual cash incentive | |||||||||||||||||||||||||||||||||||||||||
compensation | 2/20/2020 | 2/20/2020 | $ | 418,116 | $ | 836,231 | $ | 1,622,288 | – | – | – | – | – | – | ||||||||||||||||||||||||||||
Stock options(6) | 2/24/2020 | 2/20/2020 | – | – | – | – | – | – | 26,230 | $ | 156.82 | $ | 1,118,710 | |||||||||||||||||||||||||||||
Performance stock | ||||||||||||||||||||||||||||||||||||||||||
units(5) | 2/24/2020 | 2/20/2020 | – | – | – | 2,033 | 8,135 | 16,270 | – | – | $ | 1,276,951 | ||||||||||||||||||||||||||||||
Brian W. Ellis | Annual cash incentive | |||||||||||||||||||||||||||||||||||||||||
compensation | 2/20/2020 | 2/20/2020 | $ | 366,000 | $ | 732,000 | $ | 1,420,080 | – | – | – | – | – | – | ||||||||||||||||||||||||||||
Stock options(6) | 2/24/2020 | 2/20/2020 | – | – | – | – | – | – | 17,820 | $ | 156.82 | $ | 760,023 | |||||||||||||||||||||||||||||
Performance stock | ||||||||||||||||||||||||||||||||||||||||||
units(5) | 2/24/2020 | 2/20/2020 | – | – | – | 1,381 | 5,525 | 11,050 | – | – | $ | 867,259 | ||||||||||||||||||||||||||||||
Thomas P. Joyce, Jr. | Annual cash incentive | |||||||||||||||||||||||||||||||||||||||||
compensation | 2/20/2020 | 2/20/2020 | $ | 900,432 | $ | 1,800,864 | $ | 3,493,676 | – | – | – | – | – | – | ||||||||||||||||||||||||||||
Stock options(4) | 2/24/2020 | 2/20/2020 | – | – | – | – | – | – | 128,670 | $ | 156.82 | $ | 5,487,776 | |||||||||||||||||||||||||||||
Performance stock | ||||||||||||||||||||||||||||||||||||||||||
units(5) | 2/24/2020 | 2/20/2020 | – | – | – | 9,971 | 39,885 | 79,770 | – | – | $ | 6,260,748 | ||||||||||||||||||||||||||||||
William K. Daniel II | Annual cash incentive | |||||||||||||||||||||||||||||||||||||||||
compensation | 2/20/2020 | 2/20/2020 | $ | 607,457 | $ | 1,214,913 | $ | 2,356,931 | – | – | – | – | – | – | ||||||||||||||||||||||||||||
Stock options(4) | 2/24/2020 | 2/20/2020 | – | – | – | – | – | – | 52,460 | $ | 156.82 | $ | 2,237,419 | |||||||||||||||||||||||||||||
Performance stock | ||||||||||||||||||||||||||||||||||||||||||
units(5) | 2/24/2020 | 2/20/2020 | – | – | – | 4,066 | 16,265 | 32,530 | – | – | $ | 2,553,117 |
2021 PROXY STATEMENT56
Back to Contents |
|
These columns relate to |
(2) | These columns relate to equity awards granted under the |
(3) | Reflects the grant date fair value calculated in accordance with FASB ASC Topic 718. For the assumptions used in determining the grant date fair value under FASB ASC Topic 718, please see Footnote 2 to the Summary Compensation Table. |
(4) |
For a description of the vesting terms of the award, please see Footnote 3 to the Outstanding Equity Awards at |
For a description of the vesting terms of the award, please see Footnote 5 to the Outstanding Equity Awards at |
For a description of the vesting terms of the award, please see Footnote 4 to the Outstanding Equity Awards at |
For a description of the vesting terms of the award, please see Footnote |
2021 PROXY STATEMENT57
Outstanding Equity Awards at 20172020 FiscalYear-End
The following table summarizes outstanding equity awards for each named executive officer as of December 31, 2017.2020. All of the awards set forth in the table below are governed by the terms and conditions of the Omnibus Plan.
OPTION AWARDS | STOCK AWARDS | |||||||||||||||||||||||||||||||||||
NAME | GRANT DATE | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS (#) EXERCISABLE | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS (#) UNEXERCISABLE(1) | OPTION EXERCISE PRICE ($) | OPTION EXPIRATION DATE | NUMBER OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED (#)(1) | MARKET VALUE OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED ($)(2) | EQUITY INCENTIVE PLAN AWARDS: NUMBER OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED (#)(1) | EQUITY INCENTIVE PLAN AWARDS: MARKET OR PAYOUT VALUE OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED ($)(2) | |||||||||||||||||||||||||||
Thomas P. Joyce, Jr. | 2/24/2017 | - | 213,220 | (3) | $ | 86.08 | 2/24/2027 | - | - | - | - | |||||||||||||||||||||||||
2/24/2016 | - | 198,676 | (3) | $ | 65.95 | 2/24/2026 | - | - | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | 164,111 | (3) | $ | 65.83 | 2/24/2025 | - | - | - | - | ||||||||||||||||||||||||||
9/9/2014 | - | 50,419 | (3) | $ | 57.91 | 9/9/2024 | - | - | - | - | ||||||||||||||||||||||||||
2/24/2014 | - | 70,544 | (3) | $ | 57.90 | 2/24/2024 | - | - | - | - | ||||||||||||||||||||||||||
7/30/2013 | 66,343 | 33,173 | (4) | $ | 50.80 | 7/30/2023 | - | - | - | - | ||||||||||||||||||||||||||
2/21/2013 | 43,722 | 43,722 | (3) | $ | 46.13 | 2/21/2023 | - | - | - | - | ||||||||||||||||||||||||||
2/23/2012 | 94,624 | - | $ | 40.45 | 2/23/2022 | - | - | - | - | |||||||||||||||||||||||||||
2/23/2011 | 102,372 | - | $ | 37.51 | 2/23/2021 | - | - | - | - | |||||||||||||||||||||||||||
2/24/2017 | - | - | - | - | - | - | 29,855 | (5) | $ | 2,771,141 | ||||||||||||||||||||||||||
2/24/2017 | - | - | - | - | - | - | 29,855 | (6) | $ | 2,771,141 | ||||||||||||||||||||||||||
2/24/2016 | - | - | - | - | - | - | 32,787 | (5) | $ | 3,043,289 | ||||||||||||||||||||||||||
2/24/2016 | - | - | - | - | 32,787 | (7) | $ | 3,043,289 | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | - | - | - | 37,914 | (8) | $ | 3,519,177 | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | - | - | - | 27,081 | (7) | $ | 2,513,658 | - | - | ||||||||||||||||||||||||||
9/9/2014 | - | - | - | - | 20,166 | (7) | $ | 1,871,808 | - | - | ||||||||||||||||||||||||||
2/24/2014 | - | - | - | - | 28,218 | (7) | $ | 2,619,195 | - | - | ||||||||||||||||||||||||||
7/30/2013 | - | - | - | - | 19,902 | (9) | $ | 1,847,304 | - | - | ||||||||||||||||||||||||||
| 2/21/2013
|
|
| -
|
|
| -
|
|
| -
|
|
| -
|
|
| 17,491
| (7)
| $
| 1,623,515
|
|
| -
|
|
| -
|
|
Option Awards | Stock Awards | |||||||||||||||||||||||||||||
Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable(1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#)(1) | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)(1) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(2) | |||||||||||||||||||||
Rainer M. Blair | 5/15/2020 | – | 17,710 | (3) | $ | 163.85 | 5/15/2030 | – | – | – | – | |||||||||||||||||||
2/24/2020 | – | 47,510 | (3) | $ | 156.82 | 2/24/2030 | – | – | – | – | ||||||||||||||||||||
2/24/2019 | – | 66,080 | (3) | $ | 113.48 | 2/24/2029 | – | – | – | – | ||||||||||||||||||||
2/24/2018 | – | 46,330 | (3) | $ | 99.33 | 2/24/2028 | – | – | – | – | ||||||||||||||||||||
2/24/2017 | – | 53,310 | (4) | $ | 86.08 | 2/24/2027 | – | – | – | – | ||||||||||||||||||||
2/24/2016 | 23,378 | 11,689 | (4) | $ | 65.95 | 2/24/2026 | – | – | – | – | ||||||||||||||||||||
11/15/2015 | 21,447 | – | $ | 70.75 | 11/15/2025 | – | – | – | – | |||||||||||||||||||||
2/24/2015 | 19,345 | – | $ | 65.83 | 2/24/2025 | – | – | – | – | |||||||||||||||||||||
5/15/2020 | – | – | – | – | – | – | 12,750 | (5) | $ | 2,839,170 | ||||||||||||||||||||
2/24/2020 | – | – | – | – | – | – | 29,460 | (5) | $ | 6,565,456 | ||||||||||||||||||||
2/24/2019 | – | – | – | – | – | – | 40,970 | (5) | $ | 9,158,434 | ||||||||||||||||||||
2/24/2018 | – | – | – | – | – | – | 15,290 | (6) | $ | 3,425,266 | ||||||||||||||||||||
2/24/2018 | – | – | – | – | 7,645 | (7) | $ | 1,698,260 | – | – | ||||||||||||||||||||
2/24/2017 | – | – | – | – | 7,465 | (7) | $ | 1,658,275 | – | – | ||||||||||||||||||||
2/24/2016 | – | – | – | – | 3,857 | (8) | $ | 856,794 | – | – | ||||||||||||||||||||
Matthew R. McGrew | 2/24/2020 | – | 33,650 | (3) | $ | 156.82 | 2/24/2030 | – | – | – | – | |||||||||||||||||||
2/24/2019 | – | 38,180 | (3) | $ | 113.48 | 2/24/2029 | – | – | – | – | ||||||||||||||||||||
2/24/2018 | 12,356 | 18,534 | (9) | $ | 99.33 | 2/24/2028 | – | – | – | – | ||||||||||||||||||||
2/24/2017 | 8,316 | 5,544 | (9) | $ | 86.08 | 2/24/2027 | – | – | – | – | ||||||||||||||||||||
11/15/2015 | 42,882 | – | $ | 70.75 | 11/15/2025 | – | – | – | – | |||||||||||||||||||||
2/24/2015 | 8,211 | – | $ | 65.83 | 2/24/2025 | – | – | – | – | |||||||||||||||||||||
5/15/2014 | 11,213 | – | $ | 56.70 | 5/15/2024 | – | – | – | – | |||||||||||||||||||||
2/24/2014 | 7,722 | – | $ | 57.90 | 2/24/2024 | – | – | – | – | |||||||||||||||||||||
2/21/2013 | 5,474 | – | $ | 46.13 | 2/21/2023 | – | – | – | – | |||||||||||||||||||||
2/21/2013 | 5,474 | – | $ | 46.13 | 2/21/2023 | – | – | – | – | |||||||||||||||||||||
2/24/2020 | – | – | – | – | – | – | 20,870 | (5) | $ | 4,651,088 | ||||||||||||||||||||
2/24/2019 | – | – | – | – | – | – | 23,680 | (5) | $ | 5,293,427 | ||||||||||||||||||||
2/24/2018 | – | – | – | – | 6,117 | (10) | $ | 1,358,830 | – | – | ||||||||||||||||||||
2/24/2017 | – | – | – | – | 1,554 | (10) | $ | 345,206 | – | – |
2021 PROXY STATEMENT58
Option Awards | Stock Awards | |||||||||||||||||||||||||||||
Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable(1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#)(1) | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)(1) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(2) | |||||||||||||||||||||
Joakim Weidemanis | 5/15/2020 | – | 51,420 | (4) | $ | 163.85 | 5/15/2030 | – | – | – | – | |||||||||||||||||||
2/24/2020 | – | 42,560 | (3) | $ | 156.82 | 2/24/2030 | – | – | – | – | ||||||||||||||||||||
2/24/2019 | – | 58,740 | (3) | $ | 113.48 | 2/24/2029 | – | – | – | – | ||||||||||||||||||||
2/24/2018 | – | 40,150 | (3) | $ | 99.33 | 2/24/2028 | – | – | – | – | ||||||||||||||||||||
2/24/2017 | 14,216 | 28,434 | (4) | $ | 86.08 | 2/24/2027 | – | – | – | – | ||||||||||||||||||||
11/15/2016 | 25,673 | 12,837 | (4) | $ | 79.63 | 11/15/2026 | – | – | – | – | ||||||||||||||||||||
2/24/2016 | 7,791 | 3,898 | (4) | $ | 65.95 | 2/24/2026 | – | – | – | – | ||||||||||||||||||||
2/24/2016 | 7,791 | 11,689 | (4) | $ | 65.95 | 2/24/2026 | – | – | – | – | ||||||||||||||||||||
2/24/2015 | 19,927 | – | $ | 65.83 | 2/24/2025 | – | – | – | – | |||||||||||||||||||||
5/15/2014 | 22,439 | – | $ | 56.70 | 5/15/2024 | – | – | – | – | |||||||||||||||||||||
2/24/2014 | 16,542 | – | $ | 57.90 | 2/24/2024 | – | – | – | – | |||||||||||||||||||||
2/21/2013 | 9,573 | – | $ | 46.13 | 2/21/2023 | – | – | – | – | |||||||||||||||||||||
2/21/2013 | 9,573 | – | $ | 46.13 | 2/21/2023 | – | – | – | – | |||||||||||||||||||||
2/23/2012 | 9,467 | – | $ | 40.45 | 2/23/2022 | – | – | – | – | |||||||||||||||||||||
2/24/2020 | – | – | – | – | – | – | 26,390 | (5) | $ | 5,881,275 | ||||||||||||||||||||
2/24/2019 | – | – | – | – | – | – | 36,420 | (5) | $ | 8,141,327 | ||||||||||||||||||||
2/24/2018 | – | – | – | – | – | – | 13,250 | (6) | $ | 2,968,265 | ||||||||||||||||||||
5/15/2020 | – | – | – | – | 18,515 | (11) | $ | 4,112,922 | – | – | ||||||||||||||||||||
2/24/2018 | – | – | – | – | 6,625 | (7) | $ | 1,471,678 | – | – | ||||||||||||||||||||
2/24/2017 | – | – | – | – | 3,984 | (8) | $ | 885,006 | – | – | ||||||||||||||||||||
11/15/2016 | – | – | – | – | 4,237 | (8) | $ | 941,207 | – | – | ||||||||||||||||||||
2/24/2016 | – | – | – | – | 1,288 | (8) | $ | 286,116 | – | – | ||||||||||||||||||||
2/24/2016 | – | – | – | – | 3,857 | (8) | $ | 856,794 | – | – | ||||||||||||||||||||
Angela S. Lalor | 2/24/2020 | – | 26,230 | (4) | $ | 156.82 | 2/24/2030 | – | – | – | – | |||||||||||||||||||
2/24/2019 | – | 36,720 | (4) | $ | 113.48 | 2/24/2029 | – | – | – | – | ||||||||||||||||||||
2/24/2018 | – | 37,070 | (4) | $ | 99.33 | 2/24/2028 | – | – | – | – | ||||||||||||||||||||
2/24/2017 | 14,926 | 29,854 | (4) | $ | 86.08 | 2/24/2027 | – | – | – | – | ||||||||||||||||||||
2/24/2016 | 28,049 | 14,026 | (4) | $ | 65.95 | 2/24/2026 | – | – | – | – | ||||||||||||||||||||
2/24/2015 | 37,513 | – | $ | 65.83 | 2/24/2025 | – | – | – | – | |||||||||||||||||||||
2/24/2020 | – | – | – | – | – | – | 16,270 | (5) | $ | 3,625,932 | ||||||||||||||||||||
2/24/2019 | – | – | – | – | – | – | 22,770 | (5) | $ | 5,090,006 | ||||||||||||||||||||
2/24/2018 | – | – | – | – | – | – | 12,230 | (6) | $ | 2,739,765 | ||||||||||||||||||||
2/24/2018 | – | – | – | – | 6,115 | (8) | $ | 1,358,386 | – | – | ||||||||||||||||||||
2/24/2017 | – | – | – | – | 4,180 | (8) | $ | 928,545 | – | – | ||||||||||||||||||||
2/24/2016 | – | – | – | – | 2,313 | (8) | $ | 513,810 | – | – |
2021 PROXY STATEMENT59
Option Awards | Stock Awards | |||||||||||||||||||||||||||||
Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable(1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#)(1) | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)(1) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(2) | |||||||||||||||||||||
Brian W. Ellis | 2/24/2020 | – | 17,820 | (4) | $ | 156.82 | 2/24/2030 | – | – | – | – | |||||||||||||||||||
2/24/2019 | – | 25,700 | (4) | $ | 113.48 | 2/24/2029 | – | – | – | – | ||||||||||||||||||||
2/24/2018 | – | 24,710 | (4) | $ | 99.33 | 2/24/2028 | – | – | – | – | ||||||||||||||||||||
2/24/2017 | 10,663 | 21,327 | (4) | $ | 86.08 | 2/24/2027 | – | – | – | – | ||||||||||||||||||||
2/24/2016 | 15,584 | 7,794 | (4) | $ | 65.95 | 2/24/2026 | – | – | – | – | ||||||||||||||||||||
2/24/2016 | 15,584 | 4,678 | (9) | $ | 65.95 | 2/24/2026 | – | – | – | – | ||||||||||||||||||||
2/24/2020 | – | – | – | – | – | – | 11,050 | (5) | $ | 2,462,603 | ||||||||||||||||||||
2/24/2019 | – | – | – | – | – | – | 15,940 | (5) | $ | 3,563,228 | ||||||||||||||||||||
2/24/2018 | – | – | – | – | – | – | 8,160 | (6) | $ | 1,828,003 | ||||||||||||||||||||
2/24/2018 | – | – | – | – | 4,080 | (8) | $ | 906,331 | – | – | ||||||||||||||||||||
2/24/2017 | – | – | – | – | 2,987 | (8) | $ | 663,532 | – | – | ||||||||||||||||||||
2/24/2016 | – | – | – | – | 1,286 | (8) | $ | 285,672 | – | – | ||||||||||||||||||||
2/24/2016 | – | – | – | – | 1,544 | (12) | $ | 342,984 | – | – | ||||||||||||||||||||
Thomas P. Joyce, Jr | 2/24/2020 | – | 128,670 | (3) | $ | 156.82 | 2/24/2030 | – | – | – | – | |||||||||||||||||||
2/24/2019 | – | 176,210 | (3) | $ | 113.48 | 2/24/2029 | – | – | – | – | ||||||||||||||||||||
2/24/2018 | – | 154,420 | (3) | $ | 99.33 | 2/24/2028 | – | – | – | – | ||||||||||||||||||||
2/24/2017 | – | 213,220 | (3) | $ | 86.08 | 2/24/2027 | – | – | – | – | ||||||||||||||||||||
2/24/2016 | – | 99,338 | (3) | $ | 65.95 | 2/24/2026 | – | – | – | – | ||||||||||||||||||||
2/24/2020 | – | – | – | – | – | – | 79,770 | (5) | $ | 17,777,542 | ||||||||||||||||||||
2/24/2019 | – | – | – | – | – | – | 109,250 | (5) | $ | 24,421,745 | ||||||||||||||||||||
2/24/2018 | – | – | – | – | – | – | 50,960 | (6) | $ | 11,416,059 | ||||||||||||||||||||
2/24/2018 | – | – | – | – | 25,480 | (7) | $ | 5,660,127 | – | – | ||||||||||||||||||||
2/24/2017 | – | – | – | – | 29,855 | (7) | $ | 6,631,990 | – | – | ||||||||||||||||||||
2/24/2016 | – | – | – | – | 16,394 | (7) | $ | 3,641,763 | – | – |
2021 PROXY STATEMENT60
Option Awards | Stock Awards | |||||||||||||||||||||||||||||
Name | Grant Date | Number of Securities Underlying Unexercised Options (#) Exercisable | Number of Securities Underlying Unexercised Options (#) Unexercisable(1) | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#)(1) | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)(1) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)(2) | |||||||||||||||||||||
William K. Daniel II | 2/24/2019 | – | 19,276 | (3) | $ | 113.48 | 3/31/2025 | – | – | – | – | |||||||||||||||||||
2/24/2018 | – | 28,231 | (3) | $ | 99.33 | 3/31/2025 | – | – | – | – | ||||||||||||||||||||
2/24/2017 | – | 53,174 | (3) | $ | 86.08 | 3/31/2025 | – | – | – | – | ||||||||||||||||||||
2/24/2016 | 38,565 | 32,137 | (3) | $ | 65.95 | 3/31/2025 | – | – | – | – | ||||||||||||||||||||
2/24/2015 | 72,687 | – | $ | 65.83 | 2/24/2025 | – | – | – | – | |||||||||||||||||||||
2/24/2020 | – | – | – | – | – | – | 2,710 | (5) | $ | 603,951 | ||||||||||||||||||||
2/24/2019 | – | – | – | – | – | – | 18,970 | (5) | $ | 4,240,554 | ||||||||||||||||||||
2/24/2018 | – | – | – | – | – | – | 14,332 | (6) | $ | 3,210,655 | ||||||||||||||||||||
2/24/2018 | – | – | – | – | 4,658 | (7) | $ | 1,034,728 | – | – | ||||||||||||||||||||
2/24/2017 | – | – | – | – | 7,445 | (7) | $ | 1,653,832 | – | – | ||||||||||||||||||||
2/24/2016 | – | – | – | – | 5,304 | (7) | $ | 1,178,231 | – | – |
(1) | ||
|
OPTION AWARDS | STOCK AWARDS | |||||||||||||||||||||||||||||||||||
NAME | GRANT DATE | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS (#) EXERCISABLE | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS (#) UNEXERCISABLE(1) | OPTION EXERCISE PRICE ($) | OPTION EXPIRATION DATE | NUMBER OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED (#)(1) | MARKET VALUE OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED ($)(2) | EQUITY INCENTIVE PLAN AWARDS: NUMBER OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED (#)(1) | EQUITY INCENTIVE PLAN AWARDS: MARKET OR PAYOUT VALUE OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED ($)(2) | |||||||||||||||||||||||||||
Daniel L. Comas | 2/24/2017 | - | 83,160 | (3) | $ | 86.08 | 2/24/2027 | - | - | - | - | |||||||||||||||||||||||||
2/24/2016 | - | 88,819 | (3) | $ | 65.95 | 2/24/2026 | - | - | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | 84,402 | (3) | $ | 65.83 | 2/24/2025 | - | - | - | - | ||||||||||||||||||||||||||
5/15/2014 | 37,359 | 74,719 | (4) | $ | 56.70 | 5/15/2024 | - | - | - | - | ||||||||||||||||||||||||||
2/24/2014 | - | 79,364 | (3) | $ | 57.90 | 2/24/2024 | - | - | - | - | ||||||||||||||||||||||||||
2/21/2013 | 49,189 | 49,190 | (3) | $ | 46.13 | 2/21/2023 | - | - | - | - | ||||||||||||||||||||||||||
2/23/2012 | 110,386 | - | $ | 40.45 | 2/23/2022 | - | - | - | - | |||||||||||||||||||||||||||
2/23/2011 | 119,430 | - | $ | 37.51 | 2/23/2021 | - | - | - | - | |||||||||||||||||||||||||||
2/23/2010 | 62,989 | - | $ | 28.23 | 2/23/2020 | - | - | - | - | |||||||||||||||||||||||||||
2/24/2017 | - | - | - | - | - | - | 11,645 | (5) | $ | 1,080,889 | ||||||||||||||||||||||||||
2/24/2017 | - | - | - | - | - | - | 11,645 | (6) | $ | 1,080,889 | ||||||||||||||||||||||||||
2/24/2016 | - | - | - | - | - | - | 14,658 | (5) | $ | 1,360,556 | ||||||||||||||||||||||||||
2/24/2016 | - | - | - | - | 14,658 | (7) | $ | 1,360,556 | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | - | - | - | 19,504 | (8) | $ | 1,810,361 | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | - | - | - | 13,931 | (7) | $ | 1,293,075 | - | - | ||||||||||||||||||||||||||
5/15/2014 | - | - | - | - | 29,889 | (9) | $ | 2,774,297 | - | - | ||||||||||||||||||||||||||
2/24/2014 | - | - | - | - | 31,749 | (7) | $ | 2,946,942 | - | - | ||||||||||||||||||||||||||
| 2/21/2013
|
|
| -
|
|
| -
|
|
| -
|
|
| -
|
|
| 19,676
| (7)
| $
| 1,826,326
|
|
| -
|
|
| -
|
| ||||||||||
Rainer M. Blair | 2/24/2017 | - | 53,310 | (3) | $ | 86.08 | 2/24/2027 | - | - | - | - | |||||||||||||||||||||||||
2/24/2016 | - | 35,067 | (4) | $ | 65.95 | 2/24/2026 | - | - | - | - | ||||||||||||||||||||||||||
11/15/2015 | - | 21,447 | (4) | $ | 70.75 | 11/15/2025 | - | - | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | 19,345 | (4) | $ | 65.83 | 2/24/2025 | - | - | - | - | ||||||||||||||||||||||||||
5/15/2014 | 7,478 | 14,961 | (4) | $ | 56.70 | 5/15/2024 | - | - | - | - | ||||||||||||||||||||||||||
2/24/2014 | 6,615 | 4,413 | (10) | $ | 57.90 | 2/24/2024 | - | - | - | - | ||||||||||||||||||||||||||
11/1/2013 | 5,700 | 1,427 | (10) | $ | 54.93 | 11/1/2023 | - | - | - | - | ||||||||||||||||||||||||||
2/21/2013 | 10,936 | 2,736 | (10) | $ | 46.13 | 2/21/2023 | - | - | - | - | ||||||||||||||||||||||||||
2/23/2012 | 15,775 | - | $ | 40.45 | 2/23/2022 | - | - | - | - | |||||||||||||||||||||||||||
2/23/2012 | 15,775 | - | $ | 40.45 | 2/23/2022 | - | - | - | - | |||||||||||||||||||||||||||
2/23/2011 | 8,264 | - | $ | 37.51 | 2/23/2021 | - | - | - | - | |||||||||||||||||||||||||||
7/27/2010 | 11,266 | - | $ | 28.98 | 7/27/2020 | - | - | - | - | |||||||||||||||||||||||||||
2/24/2017 | - | - | - | - | - | - | 7,465 | (5) | $ | 692,901 | ||||||||||||||||||||||||||
2/24/2017 | - | - | - | - | - | - | 7,465 | (6) | $ | 692,901 | ||||||||||||||||||||||||||
11/15/2016 | - | - | - | - | - | - | 10,170 | (11) | $ | 943,979 | ||||||||||||||||||||||||||
2/24/2016 | - | - | - | - | 11,571 | (9) | $ | 1,074,020 | - | - | ||||||||||||||||||||||||||
11/15/2015 | - | - | - | - | 7,075 | (9) | $ | 656,702 | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | - | - | - | 6,387 | (9) | $ | 592,841 | - | - | ||||||||||||||||||||||||||
5/15/2014 | - | - | - | - | 5,982 | (9) | $ | 555,249 | - | - | ||||||||||||||||||||||||||
2/24/2014 | - | - | - | - | 1,764 | (12) | $ | 163,734 | - | - | ||||||||||||||||||||||||||
11/1/2013 | - | - | - | - | 570 | (12) | $ | 52,907 | - | - | ||||||||||||||||||||||||||
| 2/21/2013
|
|
| -
|
|
| -
|
|
| -
|
|
| -
|
|
| 1,093
| (12)
| $
| 101,452
|
|
| -
|
|
| -
|
|
|
OPTION AWARDS | STOCK AWARDS | |||||||||||||||||||||||||||||||||||
NAME | GRANT DATE | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS (#) EXERCISABLE | NUMBER OF SECURITIES UNDERLYING UNEXERCISED OPTIONS (#) UNEXERCISABLE(1) | OPTION EXERCISE PRICE ($) | OPTION EXPIRATION DATE | NUMBER OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED (#)(1) | MARKET VALUE OF SHARES OR UNITS OF STOCK THAT HAVE NOT VESTED ($)(2) | EQUITY INCENTIVE PLAN AWARDS: NUMBER OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED (#)(1) | EQUITY INCENTIVE PLAN AWARDS: MARKET OR PAYOUT VALUE OF UNEARNED SHARES, UNITS OR OTHER RIGHTS THAT HAVE NOT VESTED ($)(2) | |||||||||||||||||||||||||||
William K. Daniel II | 2/24/2017 | - | 74,630 | (3) | $ | 86.08 | 2/24/2027 | - | - | - | - | |||||||||||||||||||||||||
2/24/2016 | - | 77,130 | (3) | $ | 65.95 | 2/24/2026 | - | - | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | 72,687 | (3) | $ | 65.83 | 2/24/2025 | - | - | - | - | ||||||||||||||||||||||||||
5/15/2014 | 33,626 | 67,252 | (4) | $ | 56.70 | 5/15/2024 | - | - | - | - | ||||||||||||||||||||||||||
2/24/2014 | - | 66,141 | (3) | $ | 57.90 | 2/24/2024 | - | - | - | - | ||||||||||||||||||||||||||
2/21/2013 | 34,161 | 34,162 | (3) | $ | 46.13 | 2/21/2023 | - | - | - | - | ||||||||||||||||||||||||||
2/23/2012 | 78,849 | - | $ | 40.45 | 2/23/2022 | - | - | - | - | |||||||||||||||||||||||||||
2/23/2011 | 85,315 | - | $ | 37.51 | 2/23/2021 | - | - | - | - | |||||||||||||||||||||||||||
2/23/2010 | 103,086 | - | $ | 28.23 | 2/23/2020 | - | - | - | - | |||||||||||||||||||||||||||
2/24/2009 | 131,066 | - | $ | 19.89 | 2/24/2019 | - | - | - | - | |||||||||||||||||||||||||||
2/24/2017 | - | - | - | - | - | - | 10,450 | (5) | $ | 969,969 | ||||||||||||||||||||||||||
2/24/2017 | - | - | - | - | - | - | 10,450 | (6) | $ | 969,969 | ||||||||||||||||||||||||||
2/24/2016 | - | - | - | - | - | - | 12,728 | (5) | $ | 1,181,413 | ||||||||||||||||||||||||||
2/24/2016 | - | - | - | - | 12,728 | (7) | $ | 1,181,413 | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | - | - | - | 16,792 | (8) | $ | 1,558,633 | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | - | - | - | 11,994 | (7) | $ | 1,113,283 | - | - | ||||||||||||||||||||||||||
5/15/2014 | - | - | - | - | 26,901 | (9) | $ | 2,496,951 | - | - | ||||||||||||||||||||||||||
2/24/2014 | - | - | - | - | 26,460 | (7) | $ | 2,456,017 | - | - | ||||||||||||||||||||||||||
| 2/21/2013
|
|
| -
|
|
| -
|
|
| -
|
|
| -
|
|
| 13,663
| (7)
| $
| 1,268,200
|
|
| -
|
|
| -
|
| ||||||||||
Angela S. Lalor | 2/24/2017 | - | 44,780 | (4) | $ | 86.08 | 2/24/2027 | - | - | - | - | |||||||||||||||||||||||||
2/24/2016 | - | 42,075 | (4) | $ | 65.95 | 2/24/2026 | - | - | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | 37,513 | (4) | $ | 65.83 | 2/24/2025 | - | - | - | - | ||||||||||||||||||||||||||
5/15/2014 | 14,946 | 29,893 | (4) | $ | 56.70 | 5/15/2024 | - | - | - | - | ||||||||||||||||||||||||||
2/24/2014 | 11,022 | 22,048 | (4) | $ | 57.90 | 2/24/2024 | - | - | - | - | ||||||||||||||||||||||||||
2/21/2013 | 25,510 | 12,757 | (4) | $ | 46.13 | 2/21/2023 | - | - | - | - | ||||||||||||||||||||||||||
5/8/2012 | 42,988 | - | $ | 40.97 | 5/8/2022 | - | - | - | - | |||||||||||||||||||||||||||
2/24/2017 | - | - | - | - | - | - | 6,270 | (5) | $ | 581,981 | ||||||||||||||||||||||||||
2/24/2017 | - | - | - | - | - | - | 6,270 | (13) | $ | 581,981 | ||||||||||||||||||||||||||
2/24/2016 | - | - | - | - | - | - | 6,943 | (5) | $ | 644,449 | ||||||||||||||||||||||||||
2/24/2016 | - | - | - | - | 6,943 | (9) | $ | 644,449 | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | - | - | - | 8,675 | (8) | $ | 805,214 | - | - | ||||||||||||||||||||||||||
2/24/2015 | - | - | - | - | 6,196 | (9) | $ | 575,113 | - | - | ||||||||||||||||||||||||||
5/15/2014 | - | - | - | - | 11,959 | (9) | $ | 1,110,034 | - | - | ||||||||||||||||||||||||||
2/24/2014 | - | - | - | - | 8,820 | (9) | $ | 818,672 | - | - | ||||||||||||||||||||||||||
| 2/21/2013
|
|
| -
|
|
| -
|
|
| -
|
|
| -
|
|
| 5,102
| (9)
| $
| 473,568
|
|
| -
|
|
| -
|
|
With respect to the unexercisable options and unvested PSUs and RSUs reflected in the table above, the footnotes below describe the vesting terms applicable to the entire award of which such options, PSUs or RSUs are a part. |
(2) | Market value is calculated based on (a) the closing price of Danaher’s Common Stock on December |
shares, plus (b) in the case of PSUs, the amount of cash dividend equivalent rights attached to the respective PSUs and accrued as of December 31, 2020. | ||
(3) | ||
|
The option award was granted subject to time-based vesting conditions such thatone-half of the award became or becomes exercisable on each of the fourth and fifth anniversaries of the grant date. |
(4) | The option award was granted subject to time-based vesting conditions such thatone-third of the award became or becomes exercisable on each of the third, fourth and fifth anniversaries of the grant date. |
(5) | The number of shares of Common Stock that vest pursuant to the PSU award is based on the Company’s total shareholder return (TSR) ranking relative to the S&P 500 Index over |
(6) |
The number of shares and market value reported in the table reflect actual performance, since the three-year performance period for these PSU awards |
The RSU award was granted subject to both time-based and performance-based vesting conditions and prior to December 31, |
The RSU award was granted subject to both time-based and performance-based vesting conditions and prior to December 31, | |
(9) | The option award was granted subject to time-based vesting conditions such that one-fifth of the award became or becomes exercisable on each of the first five anniversaries of the grant date. |
(10) | The RSU award was granted subject to time-based vesting conditions such that one-fifth of the award vests or vested on each of the first five anniversaries of the grant date. |
|
The RSU award was granted subject to time-based vesting conditions such thatone-third of the award vests or vested on each of the third, fourth and fifth anniversaries of the grant | |
(12) | The RSU award was granted subject to both time-based and performance-based vesting conditions and prior to December 31, 2020, Danaher’s Compensation Committee certified that the performance-based vesting |
2021 PROXY STATEMENT61
Option Exercises and Stock Vested During Fiscal 20172020
The following table summarizes stock option exercises and the vesting of stock awards with respect to our named executive officers in 2017.2020.
Option Awards | Stock Awards | |||||||||||||||||||||||||||
OPTION AWARDS | STOCK AWARDS | |||||||||||||||||||||||||||
NAME | NUMBER OF SHARES ACQUIRED ON EXERCISE (#) | VALUE REALIZED ON EXERCISE ($)(1) | NUMBER OF SHARES ACQUIRED ON VESTING (#) | VALUE REALIZED ON VESTING ($)(2) | ||||||||||||||||||||||||
Name | Number of Shares Acquired on Exercise(#) | Value Realized on Exercise($)(1) | Number of Shares Acquired on Vesting(#)(2) | Value Realized on Vesting($)(2) | ||||||||||||||||||||||||
Rainer M. Blair | 33,467 | $ | 3,564,654 | 23,276 | $ | 3,885,173 | ||||||||||||||||||||||
Matthew R. McGrew | 7,894 | $ | 959,666 | 8,071 | $ | 1,632,882 | ||||||||||||||||||||||
Joakim Weidemanis | 19,834 | $ | 3,156,184 | 25,516 | $ | 4,372,420 | ||||||||||||||||||||||
Angela S. Lalor | 96,176 | $ | 13,660,367 | 19,010 | $ | 3,024,286 | ||||||||||||||||||||||
Brian W. Ellis | 0 | 0 | 13,282 | $ | 2,113,706 | |||||||||||||||||||||||
Thomas P. Joyce, Jr. | 358,424 | $ | 22,285,301 | 56,321 | $ | 4,714,315 | 313,868 | $ | 36,440,249 | 89,643 | $ | 14,263,218 | ||||||||||||||||
Daniel L. Comas | 153,184 | $ | 9,881,071 | 56,700 | $ | 4,791,748 | ||||||||||||||||||||||
Rainer M. Blair | - | - | 8,905 | $ | 757,408 | |||||||||||||||||||||||
William K. Daniel II | - | - | 42,885 | $ | 3,620,726 | 235,342 | $ | 25,902,249 | 33,260 | $ | 5,287,729 | |||||||||||||||||
Angela S. Lalor | - | - | 31,541 | $ | 2,648,348 |
(1) | Calculated by multiplying the number of shares acquired times the difference between the exercise price and the market price of Danaher Common Stock at the time of exercise. |
(2) |
Number of PSU | Value Realized | |||||
Name | Shares That Vested | on Vesting ($) | ||||
Rainer M. Blair | 14,930 | $ | 2,392,682 | |||
Matthew R. McGrew | 0 | 0 | ||||
Joakim Weidemanis | 11,950 | $ | 1,915,107 | |||
Angela S. Lalor | 12,540 | $ | 2,009,660 | |||
Brian W. Ellis | 8,960 | $ | 1,435,930 | |||
Thomas P. Joyce, Jr. | 59,710 | $ | 9,569,125 | |||
William K. Daniel II | 20,900 | $ | 3,349,434 |
Potential Payments Upon Termination orChange-of-Control as of 20172020 FiscalYear-End
The following table describes the payments and benefits that each named executive officer employed by the Company as of December 31, 2020 would be entitled to receive upon termination of employment or in connection with achange-of-control of Danaher. The amounts set forth below assume that the triggering event occurred on December 31, 2017.2020. Where benefits are based on the market value of Danaher’s Common Stock, we have used the closing price of Danaher’s Common Stock as reported on the NYSE on December 29, 201731, 2020 ($92.82222.14 per share). In addition to the amounts set forth below, upon any termination of employment each officer would also be entitled to:
• | receive all payments generally provided to salaried employees on a non-discriminatory basis upon termination, such as accrued salary, life insurance proceeds (for any termination caused by death), unused vacation and 401(k) Plan distributions;
2021 PROXY STATEMENT62
The values reflected in the table above and the footnotes below relating to the acceleration of stock options, RSUs and PSUs reflect the intrinsic value (that is, the value based on the price of Danaher’s Common Stock, and in the case of stock options minus the exercise price) of the options, RSUs and PSUs (with respect to PSUs, assuming (a) target-level performance in the case of death before the end of the relevant performance period,
Mr. Daniel’s employment with Danaher ended in March 2020 and Mr. Joyce’s employment with Danaher ended in February 2021, and in each case the departing executive qualified for “early retirement” treatment under the terms of the Omnibus Plan. As of the respective dates of termination, the value of the pro rated portion of the executive’s unvested stock options, RSUs and PSUs that would vest post-termination was equal to $12,588,420 with respect to Mr. Daniel and $53,899,550 with respect to Mr. Joyce. 2021 PROXY STATEMENT63
2021 PROXY STATEMENT64 2020 Nonqualified Deferred Compensation The table below sets forth for each named executive officer information regarding (1) participation in the
2021 PROXY STATEMENT65
2020 Pension Benefits The table below shows as of December 31, 2021 PROXY STATEMENT66 The material assumptions used in quantifying the present value of the accumulated benefit at December 31,
Equity Compensation Plan Information All data set forth in the table below is as of December 31,
2021 PROXY STATEMENT67 Pay Ratio Disclosure Provided below is information about the relationship of the
The pay ratio set forth below is a reasonable estimate calculated in a manner consistent with applicable SEC rules. In light of the numerous different methodologies, assumptions, adjustments and estimates that companies may apply as permitted under the SEC rules, this information should not be used as a basis for comparison between different companies.
For
Communications with the Board of Directors Shareholders and other parties interested in communicating directly with the Board or with individual directors, the Lead Independent Director or the non-management or independent directors as a group may do so by addressing communications to the Board of Directors, to the specified individual director or to the non-management or independent directors, as applicable, c/o Corporate Secretary, Danaher Corporation, 2200 Pennsylvania Avenue, N.W., Suite 800W, Washington, D.C. 20037-1701. Delinquent Section 16(a) Reports Section 16(a) of the Securities Exchange Act requires our officers and directors, and persons who own more than 10% of a registered class of our equity securities, to file reports of ownership and changes in ownership with the SEC. Officers, directors and greater-than-10% shareholders are required by SEC regulations to furnish us with copies of all reports they file pursuant to Section 16(a). Based solely on a review of the copies of such reports furnished to us, or written representations from certain reporting persons that no other reports were required for those persons, we believe that, during the year ended December 31, 2020, all Section 16(a) filing requirements applicable to our officers, directors and greater-than-10% shareholders were satisfied, except that Mitchell Rales failed to file on a timely basis one Form 4 (pertaining to a Company contribution of 35 shares of Common Stock to his ECP account). Such transaction was subsequently reported on Form 4. Annual Report on Form 10-K for 2020 Danaher will provide, without charge, a copy of the Danaher Annual Report on Form 10-K for 2020 filed with the SEC to any shareholder upon request directed to: Investor Relations, Danaher Corporation, 2200 Pennsylvania Avenue, N.W., Suite 800W, Washington, D.C., 20037-1701 or by email to: investor.relations@danaher.com. Shareholder Proposals and Nominations for 2022 Annual Meeting A shareholder who wishes to include a proposal in Danaher’s proxy statement for the 2022 Annual Meeting of shareholders pursuant to Rule 14a-8 under the Securities Exchange Act must submit the proposal in writing to Danaher’s Corporate Secretary at Danaher’s principal executive offices, 2200 Pennsylvania Avenue, N.W., Suite 800W, Washington, D.C. 20037-1701, for receipt no later than November 25, 2021 in order to be considered for inclusion. In order to be properly brought before the 2022 Annual Meeting, a shareholder’s notice of nomination of one or more director candidates to be included in the Company’s proxy statement pursuant to Article II, Section 11 of our Bylaws (a “proxy access nomination”) must be received by Danaher’s Corporate Secretary at the above address no earlier than October 26, 2021 and no later than November 25, 2021. If the date of the 2022 Annual Meeting is more than 30 days before or after the anniversary of the previous year’s annual meeting, notice by the shareholder to be timely must be so received not later than the later of the 120th day prior to such annual meeting or the 10th day following the day on which public disclosure of the date of such meeting is first made. Shareholders intending to present a proposal at the 2022 Annual Meeting without having it included in the Company’s proxy statement, or making a nomination of one or more director candidates without having such candidates included in the Company’s proxy statement, must comply with the advance notice requirements set forth in the Company’s Bylaws. If a shareholder fails to provide timely notice of a proposal to be presented at the 2022 Annual Meeting, the proxies provided to Danaher’s Board will have discretionary authority to vote on any such proposal which may properly come before the meeting. In order to comply with the advance notice requirements set forth in the Company’s Bylaws, appropriate notice would need to be provided to Danaher’s Secretary at the address noted above no earlier than December 25, 2021 and no later than January 24, 2022. If the date of the 2022 Annual Meeting is more than 30 days before or after the anniversary of the previous year’s annual meeting, notice by the shareholder to be timely must be so received not later than the later of the 90th day prior to such annual meeting or the 10th day following the day on which notice of the date of such annual meeting was mailed or public disclosure of the date of such annual meeting was made, whichever mailing or disclosure first occurs. BY ORDER OF THE BOARD OF DIRECTORS JAMES F. O’REILLY Vice President, Dated: March
2021 PROXY STATEMENT85
RECONCILIATION OF GAAP TONON-GAAP FINANCIAL MEASURES As described in more detail in the Compensation Discussion and Analysis section of the Company’s
/ RECONCILIATION OF 2020 ADJUSTED DILUTED EARNINGS PER COMMON SHARE (ADJUSTED EPS)
2021 PROXY STATEMENT86
|