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 |
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
| ||||
|
NOTICE
OF 2023 ANNUAL MEETING OF SHAREHOLDERS
DANAHER 2018 PROXY STATEMENT
DANAHER CORPORATION
2200 Pennsylvania Avenue, N.W., Suite 800W
Washington, D.C. 20037-1701
March 28, 2018
1. | ||
| ||
| ||
|
| |
2. | To ratify the selection of Ernst & Young LLP as Danaher’s independent registered public accounting firm for the year ending December 31, 2023. | |
3. | To approve on an advisory basis the Company’s named executive officer compensation. | |
4. | To hold an advisory vote relating to the frequency of future shareholder advisory votes on the Company’s named executive officer compensation. | |
5. | To act upon a shareholder proposal requesting | |
6. | To act upon a shareholder proposal requesting a report to
| |
7. | To consider and act upon such other business as may properly come before the meeting or at any postponement or adjournment thereof. | |
| ||
| ||
|
Shareholders of Danaher Common Stock at the close of business on March 10, 2023 can vote at Danaher’s 2023 Annual Meeting. 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.
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 29, 2023.
By order of the Board of Directors,
JAMES F. O’REILLY
Vice President, AssociateDeputy General Counsel and Secretary
MAY 9, 2023
3:00 p.m. Eastern Time
Review Your Proxy Statement and Vote in One of the Following Ways:Location
The Westin Georgetown
2350 M Street NW
Washington, D.C.
REVIEW YOUR PROXY STATEMENT AND VOTE IN ONE OF THE FOLLOWING WAYS:
VIA THE INTERNET
| ||||||||||
BY TELEPHONE
| ||||||||||
BY MAIL
|
Please refer to the enclosed proxy materials or the information forwarded by your bank, broker, trustee or other intermediary to see which voting methods are available to you. |
2018 ANNUAL MEETING OF SHAREHOLDERS
PROXY STATEMENT TABLE OF CONTENTS
Shareholders who wish to attend the meeting in person should review the instructions set forth in the attached Proxy Statement under “General Information About the Annual Meeting – Attending the Meeting.”
2023 PROXY STATEMENT |
Important Notice
IMPORTANT NOTICE Regarding the Availability of Proxy Materials for the Shareholder Meeting to be held on May 8, 2018.9, 2023. This Proxy Statement and the accompanying Annual Report are available free of charge at: www.edocumentreview.com/DHRhttps://materials.proxyvote.com/235851 or investors.danaher.com/annual-report-and-proxy.
To assist you in reviewing the proposals to be acted upon at our 20182023 Annual Meeting, below is summary information regarding the meeting, each proposal to be voted upon at the meeting and Danaher Corporation’s business performance, corporate governance, sustainability program and executive compensation. The following description is only a summary.summary and does not contain all of the information you should consider before voting. For more information about these topics, please review Danaher’s Annual Report on Form10-K for the year ended December 31, 20172022 and the complete Proxy Statement. In this Proxy Statement, the terms “Danaher” or the “Company” refer to Danaher Corporation, Danaher Corporation and its consolidated subsidiaries or the consolidated subsidiaries of Danaher Corporation, as the context requires. All financial data in this Proxy Statement refers to continuing operations unless otherwise indicated.
2018
DATE AND TIME: May 8, 2018, 3:00 p.m. local time
PLACE: Park Hyatt Washington, 1201 24th Street, NW, Washington, D.C.
RECORD DATE: March 12, 2018
Voting Matters
TIME AND DATE | LOCATION | RECORD DATE | ||||||
3:00 p.m. Eastern time Tuesday, May 9, 2023 | The Westin Georgetown 2350 M Street NW Washington, D.C. | March 10, 2023 |
Proposal |
| |||||||
| We are asking our shareholders to elect each of the |
FOR each nominee | ||||||
PROPOSAL 2 – RATIFICATION OF THE APPOINTMENT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PAGE 38) |
| We are asking our shareholders to ratify our Audit Committee’s selection of Ernst & Young LLP (“E&Y”) to act as the independent registered public accounting firm for Danaher for |
FOR | |||||
PROPOSAL 3 – ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION (PAGE 79) | ||||||||
| We are asking our shareholders to cast anon-binding, advisory vote on the compensation of the executive officers named in the Summary Compensation Table (the “named executive officers” or “NEOs”). In evaluating this year’s “say on pay” proposal, we recommend that you review our Compensation Discussion and Analysis, which explains how and why the Compensation Committee of our Board arrived at its executive compensation actions and decisions for |
FOR | ||||||
PROPOSAL 4 – ADVISORY VOTE RELATING TO FREQUENCY OF FUTURE ADVISORY VOTES ON NAMED EXECUTIVE OFFICER COMPENSATION (PAGE 81) | ||||||||
We are asking our shareholders to cast a non-binding, advisory vote on the frequency of future shareholder advisory votes on the Company’s named executive officer compensation. The voting choices are every one, every two or every three years, or abstain. |
| |||||||
PROPOSAL 5 – SHAREHOLDER PROPOSAL (PAGE 82) | You are being asked to consider a shareholder proposal requesting |
AGAINST | ||||||
PROPOSAL 6 – SHAREHOLDER PROPOSAL (PAGE 84) | You are being asked to consider a shareholder proposal requesting a report to shareholders on the effectiveness of the Company’s diversity, equity, and inclusion efforts. | AGAINST |
Please see the sections titled “General Information About the Meeting” and “Other Information” beginning on page 5686 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.
05 |
2017 Performance
In 2017,2022, as the world faced the evolution of COVID-19 from pandemic toward endemic status, widespread inflation and supply chain disruptions and economic slowdowns across many major geographies, Danaher remained focused on growing its business in the near-term while continuing to invest in long-term growth. Specifically, in 2022 Danaher:
• | Continued to evolve its portfolio by announcing the intention to separate its Environmental & Applied Solutions segment in the fourth quarter of 2023 to create a separate, publicly traded company (to be known as Veralto Corporation), which will further advance Danaher’s science and technology transformation. | |
• | ||
• |
• | Grew our business and | generated strong financial returns as illustrated below: |
DANAHER 2016-2017 YEAR-OVER-YEAR GROWTH FROM CONTINUING OPERATIONS
8.5% REVENUE GROWTH 14.5% EARNINGS GROWTH 12.5% OPERATING CASH FLOW GROWTH
06 |
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. Danaher has not experienced a sustained period of underperformance over the last twenty-five years (i.e., 1998 - 2022). We believe the consistency of our performance over that period is unmatched within our peer group. Danaher is the only company in its peer group whose total shareholder return (“TSR”) outperformed the S&P 500 Index:
|
• | over every rolling3-year period from and including |
• | by more than 600 basis points over every rolling3-year period from and including | 2002-2022. |
Danaher’s compounded average annual shareholder return has outperformed the S&P 500 Index over each of the last two, three, five-,ten-, fifteen-, twenty- and twenty-five year periods:
#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%
07 |
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.shareholders and promotes robust risk oversight. Below are highlights of our corporate governance framework.
Board refreshment remains a key area of focus for us. We have added five new directors over the past four years, reducing Danaher’s average director tenure by more than 16% over that period. | |
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 in the last decade, has no intention of contributing any Danaher funds for political purposes, and discloses its political expenditures policy on its public website. The 2022 CPA-Zicklin Index of Corporate Political Disclosure and Accountability ranked Danaher as a First Tier company. |
☑ Board refreshment remains a key area of focus for us, as evidenced by the recent addition of Raymond C. Stevens, Ph.D. to our Board.
☑ 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 2017,2022, 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. FeedbackAttendees included members of our senior management and, in some cases, members of our Board of Directors. We shared feedback received during these meetings was shared with our Nominating &and Governance Committee and Compensation Committee, informing their decision-making.
2023 PROXY STATEMENT | 08 |
Below is an overview of each of the director nominees you are being asked to elect at the 20182023 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 |
Committee Memberships | |||||||||
Name and Principal Occupation | Independent | Age | Director Since | A | C | N | S | E | F |
Rainer M. Blair President and Chief Executive Officer Danaher Corporation | 58 | 2020 | |||||||
Feroz Dewan Chief Executive Officer Arena Holdings Management LLC | 46 | 2022 | |||||||
Linda Filler Former President of Retail Products, Chief Marketing Officer, and Chief Merchandising Officer Walgreen Co. | 63 | 2005 | |||||||
Teri List Former Executive Vice President and Chief Financial Officer Gap Inc. | 60 | 2011 | |||||||
Walter G. Lohr, Jr. Retired partner Hogan Lovells | 79 | 1983 | |||||||
Jessica L. Mega, MD, MPH Former Chief Medical and Scientific Officer Verily Life Sciences LLC | 48 | 2019 | |||||||
Mitchell P. Rales Chairman of the Executive Committee Danaher Corporation | 66 | 1983 | |||||||
Steven M. Rales Chairman of the Board Danaher Corporation | 71 | 1983 | |||||||
Pardis C. Sabeti, MD, D.Phil Investigator Howard Hughes Medical Institute | 47 | 2019 | |||||||
A. Shane Sanders Former Senior Vice President of Business Transformation Verizon Communications Inc. | 60 | 2021 | |||||||
John T. Schwieters Principal Perseus TDC | 83 | 2003 | |||||||
Alan G. Spoon Former Managing General Partner Polaris Partners | 71 | 1999 | |||||||
Raymond C. Stevens, PhD Chief Executive Officer Structure Therapeutics | 59 | 2017 | |||||||
Elias A. Zerhouni, MD President and Vice Chairman OPKO Health, Inc. | 71 | 2009 |
Chair Member |
A = Audit Committee C = Compensation Committee E = Executive Committee F = Finance Committee N = Nominating & Governance Committee S = Science & Technology Committee
2023 PROXY STATEMENT | 09 |
2022 MEETING ATTENDANCE | ||
99% Overall attendance at Board and Committee Meetings | 12Directors attended 100%of Board and Committee Meetings | There were 6 Board Meetings in 2022 |
2023 PROXY STATEMENT | 10 |
Innovating products that improve lives and our planet • At Danaher, innovation doesn’t happen by accident. It is the product of the DBS Innovation Engine, a rigorous, holistic management program encompassing tools that facilitate innovation, process, strategy, organization, talent and culture • In 2022 we continued hiring Chief Science Officers and Chief Technology Officers, adding R&D associates and investing in R&D across our businesses to further build out our science and technology ecosystem | ||
Building the best team • We are 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 five Core Values • In 2022, we continued to enhance the transparency of our diversity, equity and inclusion (DE&I) efforts by publishing additional DE&I metrics in our annual sustainability report, including employee demographic data by age category and new hire data by gender and race | ||
Protecting our environment • In 2022, we announced a new target to reduce absolute Scope 1 and 2 greenhouse gas emissions by50.4% in 2032 vs. 2021 • We’re building a suite of DBS tools to support our environmental sustainability aspirations, including: • DBS Energy Management Toolkit • DBS Waste Minimization Toolkit • DBS Water Stewardship Toolkit (in pilot) • In 2022, we also piloted a climate risk and opportunity assessment program based on elements of the Task Force on Climate-Related Financial Disclosures (TCFD) recommendations |
2023 PROXY STATEMENT | 11 |
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 long-term, performance-based 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.
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 incorporatesincorporated best practices into our 2022 executive compensation program:
WHAT WE DO |
| WHAT WE DON’T DO | |||||||||||||
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 |
12 |
The following table sets forth the 20172022 compensation of our named executive officers. Please see pages 36-3855-56 for information regarding 20162021 and 20152020 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, President and CEO | 1,300,000 | 0 | 7,239,213 | 7,029,061 | 4,222,400 | 0 | 405,353 | 20,196,027 | ||||||||||||||||||||||||
Matthew R. McGrew, Executive Vice President and CFO | 878,460 | 0 | 2,197,854 | 2,133,848 | 1,783,270 | 0 | 189,912 | 7,183,344 | ||||||||||||||||||||||||
Jennifer L. Honeycutt, Executive Vice President | 802,500 | 0 | 1,680,547 | 1,631,738 | 1,548,830 | 0 | 206,589 | 5,870,204 | ||||||||||||||||||||||||
Joakim Weidemanis, Executive Vice President | 972,400 | 0 | 2,585,694 | 2,510,454 | 1,951,750 | 0 | 206,319 | 8,226,617 | ||||||||||||||||||||||||
Jose-Carlos Gutierrez-Ramos, Senior Vice President and Chief Science Officer | 754,000 | 0 | 1,835,920 | 1,205,025 | 1,408,170 | 0 | 81,942 | 5,285,057 |
13 |
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 elevenfourteen candidates thatwhom 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 20192024 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. Set forth below is biographical information regarding each candidate as of March 10, 2023.
Proxies cannot be voted for a greater number of persons than the elevenfourteen 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
RAINER M. BLAIR | Age 58 | CHIEF EXECUTIVE OFFICER | |||
Director since: 2020 Committees: • Executive • Finance •Science & Technology Other Public Directorships: • None | Mr. Blair has served as Danaher’s President and Chief Executive Officer since September 2020. Since joining Danaher in2010, Mr. Blair has served in a series of progressively more responsible general management positions (and as a Danaherofficer since 2014), including as Vice President - Group Executive from March 2014 until January 2017 and as ExecutiveVice President from January 2017 until September 2020. Mr. Blair’s broad operating and functional experience across diverse end-markets and geographies, in-depth knowledge ofDanaher’s businesses and of the Danaher Business System and leadership experience from his service in the U.S. Armyare particularly valuable to the Board given the global, diverse nature of Danaher’s portfolio. In addition, Mr. Blair adds deepmulti-cultural experience having lived and worked on three continents. | ||||
| SKILLS AND QUALIFICATIONS: | ||||
• Global/International | • M&A | ||||
•Life Sciences |
| ||||
• Product Innovation | |||||
|
| ||||
| ||||
FEROZ DEWAN | Age 46 | INDEPENDENT | ||
Director since: 2022 Committees: • Finance • Nominating & Governance • Science & Technology Other Public Directorships: • None | Mr. Dewan has served as the Chief Executive Officer of Arena Holdings Management LLC, an investment holding company, since 2016. Previously, Mr. Dewan served in a series of positions with Tiger Global Management, an investment firm, from 2003 to 2015, including most recently as Head of Public Equities. He also served as a Private Equity Associate at Silver Lake Partners, a private equity firm focused on leveraged buyout and growth capital investments in technology, technology-enabled and related industries, from 2002 to 2003. Within the past five years, Mr. Dewan served on the board of directors of each of The Kraft Heinz Company and Fortive Corporation. Mr. Dewan’s qualifications to sit on the Board include, among other factors, extensive experience in the technology industry and with technology-related companies, including extensive experience in valuation, investments and acquisitions, financial reporting, risk management, corporate governance, capital allocation, and operational oversight. Mr. Dewan was originally proposed to the Nominating and Governance Committee for election as a director by one of the Company’s directors. | |||
SKILLS AND QUALIFICATIONS: | ||||
• Global/International | • Accounting | |||
• Digital Technology | • Finance | |||
• M&A | ||||
2023 PROXY STATEMENT | 14 |
LINDA FILLER | Age 63 | INDEPENDENT | ||||
Director since: 2005 Committees: • Nominating & Governance (Chair) • Science & Technology Other Public Directorships: • The Carlyle Group | Ms.
Ms. |
|
| ||||
• Global/International | • Public Company CEO and/or President | |||
• Product Innovation | • Branding/Marketing | |||
| ||||
|
| ||||
TERI LIST | Age 60 | INDEPENDENT | ||
Director since: 2011 Committees: • Audit • Compensation Other Public Directorships: • Microsoft Corporation • Visa Inc. • DoubleVerify Holdings, Inc. | Ms.
Ms.
Given Ms. List’s extensive experience as a Chief Financial Officer, her proficiency in accounting, her knowledge of anddedication to Danaher and her retirement from full-time employment our Board has determined that Ms. List’s simultaneousservice on the audit committee of more than three public companies does not impair her ability to effectively serve on ourAudit Committee. In 2022, Ms. List attended all of the meetings of the Board and of the committees on which she served. | |||
SKILLS AND QUALIFICATIONS: |
• Global/International | • Accounting | |||||
• Digital Technology | • Finance | |||||
• M&A | ||||||
| ||||||
WALTER G. LOHR, JR. | Age 79 | INDEPENDENT | ||||
Director since: 1983 Committees: • Compensation • Finance • Nominating & Governance Other Public Directorships: • None |
| |||||
Mr. Lohr was a partner of Hogan Lovells, a global law firm, Prior to his tenure at Hogan Lovells, Mr. Lohr served as assistant attorney general for the State of Maryland. Mr. Lohr has extensive experience advising companies in a broad range of transactional matters, including mergers andacquisitions, contests for corporate control and securities offerings. His extensive knowledge of the legal strategies, issuesand dynamics that pertain to mergers and acquisitions and capital raising has been a critical resource for Danaher giventhe importance of its acquisition program. | ||||||
SKILLS AND QUALIFICATIONS: | ||||||
• M&A | • Government, legal or regulatory | |||||
2023 PROXY STATEMENT | 15 |
JESSICA L. MEGA, MD, MPH | Age 48 | INDEPENDENT | ||
Director since: 2019 Committees: • Compensation • Science & Technology Other Public Directorships: • None
|
Dr. Mega co-founded and served as Chief Medical and Scientific Officer at Verily Life Sciences LLC, a subsidiary of Alphabet Inc. focused on life sciences and healthcare, from March 2015 to January 2023. 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 servedas a faculty member at Harvard Medical School and a senior investigator with the TIMI Study Group, where she helpedlead international trials evaluating novel cardiovascular therapies and directed the genetics program.
SKILLS AND QUALIFICATIONS: | ||||
• Life Sciences | • Digital Technology | |||
• Health care management | • Government, legal or regulatory | |||
| ||||
| ||||
MITCHELL P. RALES | Age 66 | CHAIRMAN OF THE EXECUTIVE COMMITTEE | ||
Director since: 1983 Committees: • Executive (Chair) • Finance (Chair) Other Public Directorships: • ESAB Corporation • Enovis Corporation (formerly known as Colfax Corporation) | 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 The strategic vision and leadership of Mr. Rales and his brother, Steven Rales, helped create the Danaher Business Systemand 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. | |||
SKILLS AND QUALIFICATIONS: | ||||
• Global/International | • Public Company CEO and/or President | |||
• M&A | • Finance | |||
STEVEN M. RALES | Age 71 |
CHAIRMAN OF THE BOARD |
since: 1983
|
Committees:
• Executive
• Finance
• Science & Technology
Other Public Directorships: • None |
| |||||
| ||||||
Mr. Rales is a co-founder of Danaher and has served as Danaher’s Chairman of the Board since 1984. He was also CEO ofthe Company from 1984 to 1990. Mr. Rales is
The strategic vision and leadership of Mr. Rales and his brother, Mitchell Rales, helped create the Danaher Business Systemand 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. | ||||||
SKILLS AND QUALIFICATIONS: | ||||||
• Global/International | • Public Company CEO and/or President | |||||
• M&A | • Finance | |||||
| ||||||
| ||||||
PARDIS C. SABETI, MD, D.PHIL | Age 47 | |||||
Director since: 2019 Committees: • Science & Technology Other Public Directorships: • None | Dr. Sabeti has served as an Investigator for the Howard Hughes Medical Institute (“HHMI”), a non-profit medical researchorganization, since November 2015. Dr. Sabeti is a professor at the Center for Systems Biology and the Department ofOrganismic and Evolutionary Biology at Harvard University and the Department of Immunology and Infectious Disease atHarvard 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 computationalalgorithms to investigate the genomes of humans and infectious microbes. Her expertise in infectious disease researchoffers 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. | |||||
SKILLS AND QUALIFICATIONS: | ||||||
• Life Sciences | • Digital Technology | |||||
• Diagnostics | ||||||
2023 PROXY STATEMENT | 16 |
A. SHANE SANDERS | Age 60 | INDEPENDENT | ||||
Director since: 2021 Committees: • Audit • Nominating & Governance Other Public Directorships: • Commvault | Mr. Sanders served in a series of progressively more responsible leadership positions with Verizon Communications Inc.,a telecommunications company, from 1997 until December 2022, including most recently as Senior Vice President ofBusiness Transformation from March 2020 to December 2022 and as Senior Vice President of Corporate Finance from 2015to March 2020. Prior to joining Verizon, Mr. Sanders served in various finance roles at Hallmark Cards, Inc., a retailer ofgreeting cards and gifts, and Safelite Group, Inc., a provider of vehicle glass repair, and began his career at Grant Thornton, an audit, tax and advisory firm, in 1984. Mr. Sanders’ leadership experiences in Verizon’s accounting and finance organization have spanned a range of functionalareas, including financial planning and analysis, risk management, audit and public reporting and compliance. His broadand deep experience in a large, dynamic organization gives him a keen understanding of the range of finance andaccounting matters and judgments Danaher encounters. In addition, his business transformation experience offers valuableperspectives as Danaher continues to grow and evolve its portfolio of businesses. | |||||
SKILLS AND QUALIFICATIONS: | ||||||
• Global/International | • Accounting | |||||
• M&A | • Finance | |||||
• Digital Technology | ||||||
JOHN T. SCHWIETERS | Age 83 | INDEPENDENT | ||||
Director since: 2003 Committees: • Audit (Chair) • Nominating & Governance Other Public Directorships: •None | 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 accountingfirms 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. |
| ||||
• M&A | • Accounting | |||
| ||||
ALAN G. SPOON | Age 71 | INDEPENDENT | ||
Director since: 1999 Committees: • Compensation (Chair) Other Public Directorships: • Fortive Corporation • IAC/InterActiveCorp. • Match Group, Inc. | Mr. Spoon
In addition to his leadership | |||
SKILLS AND QUALIFICATIONS: | ||||
• Product Innovation | • Public Company CEO and/or President | |||
• Digital Technology |
| • Finance | ||
| ||||
2023 PROXY STATEMENT | 17 |
RAYMOND C. STEVENS, PH.D. | Age 59 | INDEPENDENT | ||
Director since: 2017 Committees: • Audit • Science & Technology Other Public Directorships: • Structure Therapeutics | Professor Stevens has served as Chief Executive Officer of Structure Therapeutics (formerly known as ShouTi), abiotechnology company, since May 2019. He also 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,
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 drugdevelopment, are highly beneficial to Danaher given our strategic focus on the development of research tools used tounderstand the causes of disease, identify new therapies and test new drugs and vaccines. His extensive experienceliving and working in China is also valuable to Danaher given China’s strategic significance to our business. | |||
SKILLS AND QUALIFICATIONS: |
• Global/International | • Product Innovation | ||
• Life Sciences | • Public Company CEO and/or President | ||
|
| ||||||
ELIAS A. ZERHOUNI, MD | Age 71 | INDEPENDENT | ||||
since: 2009 Committees: • Nominating & Governance • Science & Technology (Chair) Other Public Directorships: • OPKO Health, Inc.
| ||||||
Dr. Zerhouni has served as President and Vice Chairman of OPKO Health, Inc. a medical test and medication company, sinceMay 2022. He previously served as President, Global Research & Development, for Sanofi S.A., a global pharmaceuticalcompany,
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 hisdeep, technical knowledge of the research and clinical applications of medical technologies, are of considerable importancegiven Danaher’s strategic focus in the medical technologies markets. Dr. Zerhouni’s government experience also giveshim a strong understanding of how government agencies work, and his experience growing up in North Africa, togetherwith the global nature of the issues he faced at NIH and his role at France-based Sanofi, give him a global perspectivethat is valuable to Danaher. | ||||||
The Board of Directors recommends a vote FOR each of the foregoing nominees.
• Global/International |
• Health care management | ||||
• Life Sciences | • Government, legal or regulatory | |||
| • Diagnostics | • Public Company CEO and/or President | ||
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR EACH OF THE FOREGOING NOMINEES. |
2023 PROXY STATEMENT | 18 |
Director
SelectionSelection.
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. |
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
When Danaher recruits a formaldirector candidate, either a search firm engaged by the Committee 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 respect to race, gender and national origin)member of the Board when considering director nominees.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 conductedand any other factors the Committee may deem appropriate.
Diversity is an important consideration in the Board’s decision-making with respect to such prospective nominee.
Board composition. The graph below illustratesBoard 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 represented onappropriate in light of the Company’s needs, and in this regard also subjectively takes into consideration the diversity (including with respect to age, race, gender, national origin and U.S. military veteran status) of the Board when considering director nominees. As of the date of this Proxy Statement, half of the Company’s Board members are diverse from a gender and/or race/ethnicity perspective, one Board member is a U.S. military veteran and our Board:Board includes a broad range of ages and national origins. Recognizing how this diversity has contributed to our Board and consistent with the DBS principle of continuous improvement, our Board is committed to increasing to at or above 30% the percentage of gender-diverse directors by the time of the Company’s 2024 Annual Meeting.
| 2023 PROXY STATEMENT | 19 |
| ||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||
| ||||||||||||||||||||||||||||||||||||||||
| Back to Contents |
The chart that follows illustrates the diverse set of skills, expertise and backgrounds represented on our Board.
SKILLS AND EXPERTISE | Blair | Dewan | Filler | List | Lohr | Mega | M. Rales | S. Rales | Sabeti | Sanders | Schwieters | Spoon | Stevens | Zerhouni | |
Global/international | |||||||||||||||
Life sciences | |||||||||||||||
Diagnostics | |||||||||||||||
Health care management | |||||||||||||||
Product innovation | |||||||||||||||
Digital technology | |||||||||||||||
M&A | |||||||||||||||
Public company CEO and/or President | |||||||||||||||
Accounting | |||||||||||||||
Finance | |||||||||||||||
Branding/marketing | |||||||||||||||
Government, legal or regulatory | |||||||||||||||
Age | 58 | 46 | 63 | 60 | 79 | 48 | 66 | 71 | 47 | 60 | 83 | 71 | 59 | 71 | |
Gender | M | M | F | F | M | F | M | M | F | M | M | M | M | M | |
Race/Ethnicity* | C | A | C | C | C | C | C | C | M | B | C | C | C | N | |
Born outside U.S. | |||||||||||||||
U.S. Military Veteran |
“A” refers to Asian “B” refers to Black “C” refers to Caucasian (other than Middle Eastern or North African descent) |
“M” refers to Middle Eastern descent “N” refers to North African descent |
2023 PROXY STATEMENT | 20 |
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 sustainability framework.
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 consideringGiven the Committee’s recommendations,critical role of acquisitions in our overall strategy as well as the diversity of our portfolio, it is essential that our Board include members with the experience of having led the Company through a range of M&A and economic cycles. However, the Board also 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. We have added five new directors over the past four years, reducing Danaher’s average director tenure by more than 16% over that period.
The recent additionBoard addresses succession planning for key Board leadership roles (such as Chairman of Raymond C. Stevens, Ph.D.the Board, Lead Independent Director and Committee chairs) by seeking to ourensure the depth of expertise on the Board is evidencesufficient to provide appropriate successors in the event of our focus on refreshment.a succession event.
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 (or, if such amount is not a whole number, the closest whole number below twenty percent), provided that the shareholder(s) and nominee(s) satisfy the requirements specified in the Bylaws.
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.
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.
21 |
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. | ||||||
|
|
The 2022 CPA-Zicklin Index of Corporate Political Disclosure and Accountability ranked Danaher as a First Tier company. |
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
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 6.2six 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. Filler as our Lead Independent Director. As the Lead Independent Director, Mr. Ehrlich:Ms. Filler:
• | Presides at all meetings of the Board at which the Chairman of the Board and the Chairman of the Executive Committee are not present, including the executive sessions of non-management directors, which are typically held at the end of each regularly scheduled Board meeting. |
2023 PROXY STATEMENT | 22 |
• | Has the authority to call meetings of the independent directors. Ms. Filler has exercised this authority by typically requiring meetings of the non-management directors at the end of every regularly scheduled Board meeting. |
• | Serves as a liaison between the Chairman and the independent directors. Ms. Filler engages frequently with Mr. Steven Rales on a range of topics relating to the Board and the Company’s governance program. |
• | Approves information sent to the Board. |
• | Approves meeting agendas for the Board. |
• | Approves meeting schedules to assure that there is sufficient time for discussion of all agenda items. |
• | Engages with major shareholders, including direct communication, as appropriate. |
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 and the application of DBS, 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 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 ten 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 and 2021 acquisition of Aldevron, 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 three dimensions: critical experiences, leadership capabilities and personal characteristics/traits. 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. |
2023 PROXY STATEMENT | 23 |
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. 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. Generally, the Board delegates risk oversight responsibility to its committees where it believes the committee’s focused domain expertise will support efficient and effective oversight, and each committee typically has responsibility with respect to risks that are associated with the purpose of, and responsibilities delegated to, that committee. Each committeeof the Audit, Compensation, Nominating and Governance, and Science and Technology Committees 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 timeframe over which the Company’s Risk Committee (consistingBoard and its committees evaluate risk typically varies depending on the nature of members of senior management) inventories, assessesthe risk. From time to time, the Board and/or its committees may consider inputs from outside advisors with respect to certain risks and prioritizes the most significant risks facing the Company as well as related mitigation efforts and provides a report to the Board.risk trends. 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 graphic below summarizes the primary areas of risk overseen by the Board and by each of its committees.
2023 PROXY STATEMENT | 24 |
Danaher’s disclosure controls and procedures documentation specifically references our annual enterprise risk assessment process as an element of our disclosure controls and procedures, and requires membership overlap between Danaher’s Disclosure Committee and Danaher’s Risk Committee.
SPOTLIGHT: OVERSIGHT OF CYBERSECURITY RISK | ||
Danaher’s goal is to maintain a secure environment for our products, data and systems that effectively supports our business objectives and customer needs. Our commitment to cybersecurity emphasizes cultivation of a security-minded culture through security education and training, and a programmatic and layered approach that reflects industry best practice.
| We have adopted a comprehensive Information Security Policy that clearly articulates Danaher’s expectations and requirements with respect to acceptable use, risk management, data privacy, education and awareness, security incident management and reporting, identity and access management, third-party management, security (with respect to physical assets, products, networks and systems), security monitoring and vulnerability identification. The policy sets forth a detailed security incident management and reporting protocol, with clear escalation timelines and responsibilities. We also maintain a global incident response plan and regularly conduct exercises to help ensure its effectiveness and our overall preparedness.
| |
|
| |
|
| |
| ||
|
on our cybersecurity program. |
CEO Succession Planning
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.
2023 PROXY STATEMENT | 25 |
General
The Board met sevensix times during 2017.in 2022. All directors attended at least 75%90% (and twelve of the aggregatedirectors attended 100%) of the total number of meetings of the Board and of allthe committees of the Board on which they served (duringheld 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 2017.2022.
The membership of each of the Board’s committees as of March 12, 201810, 2023 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 2017.2022. 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.
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
| ||||||||||||||||||||
|
|
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 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, qualifies as an audit Each such 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. 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:
Name of Director | Audit | Compensation | Nominating & Governance | Science & Technology | Executive | Finance | ||||||
Rainer M. Blair | ||||||||||||
Feroz Dewan | ||||||||||||
Linda Filler | ||||||||||||
Teri List | ||||||||||||
Walter G. Lohr, Jr. | ||||||||||||
Jessica L. Mega, MD, MPH | ||||||||||||
Mitchell P. Rales | ||||||||||||
Steven M. Rales | ||||||||||||
Pardis C. Sabeti, MD, D.Phil. | ||||||||||||
A. Shane Sanders | ||||||||||||
John T. Schwieters | ||||||||||||
Alan G. Spoon | ||||||||||||
Raymond C. Stevens, Ph.D. | ||||||||||||
Elias A. Zerhouni, MD | ||||||||||||
# OF MEETINGS HELD IN 2022 | 7 | 6 | 6 | 5 | 0 | 3 |
Each member of the Compensation Committee is an “outside 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.
Management Role in Supporting the Compensation Committee
Our Senior Vice President-Human Resources, Vice President-Compensation and Secretary generally attend, and fromtime-to-time our CEO attends, the Compensation Committee meetings. In particular, our CEO:
Chair |
AUDIT COMMITTEE | ||
Members: • John T. Schwieters (Chair) • Teri List • A. Shane Sanders • Raymond C. Stevens, Ph.D. Meetings in 2022: | PRINCIPAL RESPONSIBILITIES: • assist the Board in overseeing the: • quality and integrity of Danaher’s financial statements; • effectiveness of Danaher’s internal control over financial reporting; • qualifications, independence and performance of Danaher’s independent auditors; • performance of Danaher’s internal audit function; • company’s compliance with legal and regulatory requirements; • risks described above under “Board Oversight - Risk”; and • company’s swaps and derivatives transactions and related policies and procedures. • prepare the Audit Committee Report included in the Company’s annual Proxy Statement | |
2023 PROXY STATEMENT | 26 |
COMPENSATION COMMITTEE | ||
• Alan G. Spoon (Chair) • Teri List • Walter G. Lohr, Jr. • Jessica L. Mega, MD, MPH Meetings in 2022: | PRINCIPAL RESPONSIBILITIES: • discharge 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; • review and make recommendations to the Board with respect to the adoption, amendment and termination of all executive incentive compensation plans and all equity compensation plans, and exercise 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; • review and consider the results of shareholder advisory votes on the Company’s executive compensation, and make recommendations to the Board regarding the frequency of such advisory votes; • monitor compliance by directors and executive officers with the Company’s stock ownership requirements; • assist the Board in overseeing the risks described above under “Board Oversight of Risk”; • review and discuss with Company management the Compensation Discussion and Analysis and recommend to the Board the inclusion of the Compensation Discussion and Analysis in the annual meeting proxy statement; • prepare the Compensation Committee report included in the annual meeting proxy statement; and • consider 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 a “non-employee director” for purposes of Rule 16b-3 under theExchange Act and, based on the determination of the Board, independent under the NYSE listing standards and underRule 10C-1 under the Exchange Act. As of February 22, 2023, Dr. Mega joined the Compensation Committee. |
MANAGEMENT ROLE IN SUPPORTING THE COMPENSATION COMMITTEE: Members of our senior management generally attend the Compensation Committee meetings. In 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, preparing meeting materials and providing the Committee with data relating to executive compensation as requested by the Committee. |
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 experts. The Committee has engaged Frederic W. Cook & Co., Inc. (“FW Cook”) as its independent compensation consultant since 2008. The Committee engages FW Cook because it is considered one of the premier independent compensation consulting firms and has never provided any services to the Company other than the compensation-related services provided to or at the direction of the Compensation Committee and the Nominating and Governance Committee. FW Cook takes its direction solely from the Committee (and with respect to matters relating to the non-management director compensation program, the Nominating and Governance Committee). In addition to the director compensation advice provided to the Nominating and Governance Committee, FW Cook’s primary responsibilities in 2022 were to: • provide advice and data in connection with the structuring of the executive and equity compensation programs and the compensation levels for the Company’s executive officers compared to their peers; • assess the Company’s executive compensation program in the context of compensation governance best practices; • update the Committee regarding legislative and regulatory initiatives as well as emerging trends and investor views in the area of executive compensation; • provide data regarding the share dilution costs attributable to the Company’s aggregate equity compensation program; • assist in the review of the Company’s executive compensation public disclosures; and • provide advice and data in connection with the structuring of the executive and equity compensation programs of Danaher’s EAS business (which Danaher intends to separate into a publicly-traded company, to be known as Veralto Corporation, in 2023), and the compensation levels for the executive officers thereof compared to their anticipated peers, as well as general advice relating to executive and equity compensation matters related to the separation of the EAS business.
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 work performed for or at the direction of the Compensation Committee and the Nominating and Governance Committee raises any conflict of interest, taking into account the factors listed in Exchange Act Rule 10C-1(b)(4), and has concluded that such work does not create any conflict of interest. |
2023 PROXY STATEMENT | 27 |
NOMINATING & GOVERNANCE COMMITTEE | ||
Members: • Linda Filler (Chair) • Feroz Dewan • Walter G. Lohr, Jr. • A. Shane Sanders • John T. Schwieters • Elias A. Zerhouni, MD Meetings in 2022: | PRINCIPAL RESPONSIBILITIES: • assist the Board in identifying individuals qualified to become Board members, and make recommendations to the Board regarding all nominees for Board membership; • make recommendations to the Board regarding the size and composition of the Board and its committees; • make recommendations to the Board regarding matters of corporate governance and oversee the operation of Danaher’s Corporate Governance Guidelines and Related Person Transactions Policy; • develop and oversee the annual self-assessment process for the Board, its committees, and our directors; • assist the Board in CEO succession planning; • assist the Board in overseeing the risks described above under “Board Oversight - Risk”; • review and make recommendations to the Board regarding non-management director compensation; • oversee the orientation process for newly elected members of the Board and continuing director education; and • oversee the Company’s sustainability program. The Board has determined that all of the members of the Nominating and Governance Committee are independentwithin the meaning of the NYSE listing standards. As of February 22, 2023, Messrs. Dewan and Sanders joined theNominating & Governance Committee. |
SCIENCE & TECHNOLOGY COMMITTEE | ||
Members: • Elias A. Zerhouni, MD (Chair) • Rainer Blair • Feroz Dewan • Linda Filler • Jessica L. Mega, MD, MPH • Steven M. Rales • Pardis C. Sabeti, MD, D.Phil. • Raymond C. Stevens, Ph.D. Meetings in 2022: | PRINCIPAL RESPONSIBILITIES: • review and assess the Company’s science and technology innovation strategy and priorities; • assess the competitive position of the Company’s technology portfolio; • review with management key programs, processes and organizational structures related to innovation, research and development and the commercialization of technology; and • assess, and advise the Board with respect to, potentially disruptive science and technology trends, opportunities and risks. |
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, and with the Committee’s consent, request from management information regarding compensation amounts and practices, the interrelationship between ourtypically related to 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 compensation consultant work performed foracquisition or at the direction of the Compensation Committee and the Nominating and Governance Committee raises any conflict of interest, taking into account the factors listed in Securities Exchange Act Rule10C-1(b)(4), and has concluded that such work does not create any conflict of interest.
Nominating and Governance Committee
The Nominating and Governance Committee met four times in 2017. The Nominating and Governance Committee:capital raising transactions.
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.
Finance Committee
The Finance Committee met once in 2017. The Finance Committee approves business acquisitions, investments and divestitures up to the levels of authority delegated to it by the Board.
Our Board recognizes that a rigorous and constructive evaluation process is an essential component of good corporate governance and Board effectiveness. Under the leadership of our Lead Independent Director, the Nominating & Governance Committee oversees the annual evaluation process and periodically reviews the format of the process to help ensure it is eliciting actionable feedback with respect to the effectiveness of the Board, Board committees and individual directors.
2023 PROXY STATEMENT | 28 |
The annual Board, committee and individual director evaluation process consists of the following components:
We actively seek and highly value feedback from our shareholders. During 2022, 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. Attendees included members of our senior management and, in some cases, members of our Board of Directors. We shared feedback received during these meetings with our Nominating and Governance Committee and Compensation Committee, informing their decision-making.
• | Director and Executive Officer Stock Ownership Requirements. Our Board has adopted stock ownership requirements for non-management directors. Under the requirements, |
• | Recoupment Policy.We have a rigorous, “no-fault” compensation recoupment policy that applies to executive officers and other senior leaders. |
2023 PROXY STATEMENT | 29 |
• | Anti-Pledging/Hedging Policy.In 2013 Danaher’s Board adopted a policy that prohibits any director or executive officer from pledging as security under any obligation any shares of Danaher Common Stock that the director or officer directly or indirectly owns and controls, except for any shares that were pledged as of the date the policy was adopted. Certain shares of Common Stock owned by Steven Rales and by Mitchell Rales were exempted from the policy because such shares had been pledged for decades, to secure lines of credit that reduce the need to sell shares for liquidity purposes. Messrs. Steven and Mitchell Rales acquired these pledged shares in cash purchase transactions between 1983 and 1988 and did not receive them as compensation or purchase them from Danaher. These pledged shares do not count toward the Company’s stock ownership requirements. |
Notwithstanding that these shares are exempted from Danaher’s policy, as part of its risk oversight function the Audit Committee of Danaher’s Board reviews these share pledges on a quarterly basis to assess whether such pledging poses an undue risk to the Company. The Committee has concluded that such pledge arrangements do not pose an undue risk to the Company, based in particular on its consideration of the following factors:
• | the amount by which the market value of the shares pledged as collateral exceeds the amount of secured indebtedness, which the Committee believes is a key factor in assessing the degree of risk posed by the pledging arrangements. At December 31, 2022, the maximum amount of secured indebtedness permitted under the lines of credit would not exceed 25% of the market value of the shares pledged as collateral; | |
• |
the number of shares and percentage of total outstanding shares pledged; and | ||
• | the more than 15% reduction since 2013 in the aggregate number of shares pledged by Messrs. Steven Rales and Mitchell Rales. | |
| During 2021 and 2022, we engaged with shareholders regarding the pledge arrangements, representing approximately 25% of Danaher’s outstanding common shares, and at Danaher’s 2022 Annual Meeting a significant majority of these shares were voted in favor of our Audit Committee members. During these discussions with investors, we answered questions posed by investors and using the detail set forth above explained the reasons why the Audit Committee believes it is in the best interest of Danaher and its shareholders to allow such pledging arrangements subject to rigorous Audit Committee oversight. Additionally, we have incorporated input received from these investor engagements into our public disclosures. | |
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. | ||
• | Shareholder Right to Call Special Meeting. Shareholders owning 25% or more of Danaher’s outstanding shares may require the Company to call a special meeting of shareholders. | |
At Danaher’s 2022 Annual Meeting, a minority of the shares represented in person or by proxy and entitled to vote supported 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 2022 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. |
Executive Committee
The Executive Committee did not meet in 2017. The Executive Committee exercises between meetingsFor an overview of the Board such powers and authority in the management of the business and affairs of the Company as are specifically delegated to it by the Board from time to time.Danaher’s sustainability program, please see “Proxy Statement Summary – Sustainability.”
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 StandardsCode of Conduct. The Corporate Governance Guidelines, charters of each of the Audit, Compensation and Nominating and Governance Committees and StandardsCode of Conduct are available in the “Investors—Corporate Governance” section of our website at http://www.danaher.com.
Corporate Social Responsibility
Corporate social responsibility is deeply ingrained in our culture and work, and has been for decades. We are a science and technology innovator committed to solving customers’ most complex challenges, and improving quality of life around the world. We are also placing a greater emphasis on complementing our external performance with internal initiatives that help ensure supportive, diverse and inclusive work environments worldwide—places where our associates can be themselves, engage deeply with their work and seize opportunities to realize their own potential through professional development. More information about Danaher’s corporate social responsibility efforts is included in our latest Corporate Social Responsibility Report available in the “Investors—“Investors – Corporate Governance” section of our website at http://www.danaher.com.
30 |
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:
• | compensation should fairly pay directors for work required in a company of our size and scope, and differentiate among directors where appropriate to reflect different levels of responsibilities; |
• | a significant portion of the total compensation should be paid in stock-based awards to align directors’ interests with the long-term interests of our shareholders; and |
• | the structure of the compensation program should be simple and transparent. |
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, theThe Committee has engagedengages 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 anticipates reviewing,typically reviews, and seekingseeks advice from FW Cook regarding, the Company’snon-management director compensation on an annual basis.
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).
Effective as of January 1, 2018, eachnon-management director receives:
Director cash retainer of $115,000,retainers are paid quarterly in four, equal installments following each quarter of service.
In addition, the lead independent director receives an annual cash retainer of $30,000, the chair of the Audit Committee receives an annual cash retainer of $25,000, the chair of the Compensation Committee receives an annual cash retainer of $20,000 and the chair of the Nominating and Governance Committee receives an annual cash retainer of $15,000, in each case paid in four, equal installments following each quarter of service.
2023 PROXY STATEMENT | 31 |
Eachnon-management director can elect to defer all or part of the cash director fees that he or shethe director earns with respect to a particular year under theNon-Employee Directors’ Deferred Compensation Plan, which is asub-plan under the Omnibus Plan. Amounts deferred under the plan are converted into a particular number of phantom shares of Danaher Common Stock, calculated based on the closing price of Danaher’s Common Stock on the date that such quarterly fees would otherwise have been paid.paid, and are maintained in bookkeeping accounts. Dividends accrued on phantom shares are also deemed invested in phantom shares of Danaher Common Stock. A director may elect to have his or hertheir plan balance distributed upon cessation of Board service, or one, two, three, four or five years after cessation of Board service. All distributions from the plan are in the form of shares of Danaher Common Stock.
|
Director Stock Ownership Requirements
Our Board has adopted stock ownership requirements fornon-management directors. Under the requirements, eachnon-management director (within five years of his or her initial election or appointment) is required to beneficially own Danaher shares with a market value of at least five times his or her annual cash retainer (excluding the additional cash retainers paid to the committee chairs and the Lead Independent Director). Once a director has acquired a number of shares that satisfies such ownership multiple, such number of shares then becomes such director’s minimum ownership requirement (even if his or her retainer increases or the fair market value of such shares subsequently declines). Under the policy, beneficial ownership includes RSUs held by the director, shares in which the director or his or her spouse or child has a direct or indirect interest and phantom shares of Danaher Common Stock in theNon-Employee Directors’ Deferred Compensation Plan, but does not include shares subject to unexercised stock options or pledged shares. Each Danaher director is in compliance with the policy.
Anti-Pledging/Hedging Policy
In 2013 Danaher’s Board adopted a policy that prohibits any director or executive officer from pledging as security under any obligation any shares of Danaher Common Stock that he or she directly or indirectly owns and controls. The Board exempted from the policy shares of Danaher Common Stock that were already pledged as of the time the policy was adopted, but pledged shares of Danaher Common Stock do not count toward stock ownership requirements and the pledging of any additional shares is prohibited. Certain shares of Common Stock owned by Messrs. Steven and Mitchell Rales were exempted from the policy because such shares have been pledged for decades, to secure lines of credit that reduce the need to sell shares for liquidity purposes. Messrs. Steven and Mitchell Rales acquired these shares in cash purchase transactions between 1983 and 1988, and did not receive them as compensation or purchase them from Danaher.
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:
Danaher policy also prohibits Danaher directors and employees (including executive officers) from engaging in any transactions involving a derivative of a Danaher security, including hedging transactions.
The table below summarizes the compensation paid by Danaher to thenon-management directors for the year ended December 31, 2017.2022. Each of Steven Rales, Mitchell Rales and Thomas P. Joyce, Jr.Rainer M. Blair serves as a director and executive officer of Danaher but doesthey have not received and do not receive any additional compensation for services provided as a director. Neither Steven Rales nor Mitchell Rales is a named executive officer. Details regarding the 20172022 executive compensation provided to each of Steven Rales and Mitchell Rales is set forth under “Director Independence and Related Person Transactions.”
NAME | FEES EARNED OR PAID IN CASH ($) | STOCK AWARDS ($) (1)(2) | OPTION AWARDS ($) (1)(2) | TOTAL ($) | ||||||||||||
Donald J. Ehrlich | $ | 167,000 | $ | 81,032 | $ | 67,225 | $ | 315,257 | ||||||||
Linda Hefner Filler (3) | 0 | $ | 211,032 | $ | 67,225 | $ | 278,257 | |||||||||
Robert J. Hugin (4) | $ | 115,000 | $ | 81,032 | $ | 67,225 | $ | 263,257 | ||||||||
Teri List-Stoll (3) | 0 | $ | 196,032 | $ | 67,225 | $ | 263,257 | |||||||||
Walter G. Lohr, Jr. | $ | 115,000 | $ | 81,032 | $ | 67,225 | $ | 263,257 | ||||||||
John T. Schwieters | $ | 140,000 | $ | 81,032 | $ | 67,225 | $ | 288,257 | ||||||||
Alan G. Spoon (3) | 0 | $ | 196,032 | $ | 67,225 | $ | 263,257 | |||||||||
Raymond C. Stevens, Ph.D. (3)(5) | 0 | $ | 179,740 | $ | 67,225 | $ | 246,965 | |||||||||
Elias A. Zerhouni, M.D. (3) | 0 | $ | 196,032 | $ | 67,225 | $ | 263,257 |
Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1)(2) | Option Awards ($)(1)(2) | Total ($) | ||||
Feroz Dewan(3)(4) | — | 144,070 | 80,546 | 224,616 | ||||
Linda Filler(3) | — | 276,839 | 91,469 | 368,308 | ||||
Teri List | 125,000 | 91,839 | 91,469 | 308,308 | ||||
Walter G. Lohr, Jr. | 139,000 | 91,839 | 91,469 | 322,308 | ||||
Jessica L. Mega, MD, MPH | 125,000 | 91,839 | 91,469 | 308,308 | ||||
Pardis C. Sabeti, MD, D. Phil.(3) | — | 216,839 | 91,469 | 308,308 | ||||
A. Shane Sanders(3) | — | 216,839 | 91,469 | 308,308 | ||||
John T. Schwieters | 150,000 | 91,839 | 91,469 | 333,308 | ||||
Alan G. Spoon(3) | — | 236,839 | 91,469 | 328,308 | ||||
Raymond C. Stevens, Ph.D.(3) | — | 216,839 | 91,469 | 308,308 | ||||
Elias A. Zerhouni, MD(3) | — | 236,839 | 91,469 | 328,308 |
(1) | The amounts reflected in these columns represent the aggregate grant date fair value of the applicable award computed in accordance with FASB ASC Topic 718. With respect to stock awards, the grant date fair value under FASB ASC Topic 718 is calculated based on the number of shares of |
|
Common Stock underlying the award, times the closing price of the Danaher Common Stock on the date of |
(2) | The table below sets forth as to eachnon-management director the aggregate number of unvested RSUs and aggregate number of stock options outstanding as of December 31, |
NAME OF DIRECTOR |
AGGREGATE NUMBER OF DANAHER |
AGGREGATE NUMBER OF UNVESTED DANAHER RSUS OWNED AS OF DECEMBER 31, 2017 | ||||||||
Donald J. Ehrlich | 46,862 | 990 | ||||||||
Linda Hefner Filler | 57,440 | 990 | ||||||||
Robert J. Hugin | 6,470 | 990 | ||||||||
Teri List-Stoll | 20,920 | 990 | ||||||||
Walter G. Lohr, Jr. | 57,440 | 990 | ||||||||
John T. Schwieters | 57,440 | 990 | ||||||||
Alan G. Spoon | 57,440 | 990 | ||||||||
Raymond C. Stevens, Ph.D. | 3,540 | 990 | ||||||||
Elias A. Zerhouni, M.D. | 36,284 | 990 |
2023 PROXY STATEMENT | 32 |
Name of Director | Aggregate Number of Danaher Stock Options Owned as of December 31,2022(#) | Aggregate Number of Unvested Danaher RSUs Owned as of December 31, 2022(#) | ||
Feroz Dewan | 829 | 315 | ||
Linda Filler | 21,487 | 372 | ||
Teri List | 24,977 | 372 | ||
Walter G. Lohr, Jr. | 24,977 | 372 | ||
Jessica L. Mega, MD, MPH | 4,805 | 372 | ||
Pardis C. Sabeti, MD, D. Phil. | 4,805 | 372 | ||
A. Shane Sanders | 2,145 | 372 | ||
John T. Schwieters | 24,977 | 372 | ||
Alan G. Spoon | 21,487 | 372 | ||
Raymond C. Stevens, Ph.D. | 12,145 | 372 | ||
Elias A. Zerhouni, MD. | 24,977 | 372 |
(3) | Each of |
2022 Phantom Shares Received Under Deferred Compensation Plan(#) | ||
Feroz Dewan | 247 | |
Linda Filler | 700 | |
Pardis C. Sabeti, MD, D. Phil. | 473 | |
A. Shane Sanders | 473 | |
Alan G. Spoon | 549 | |
Raymond C. Stevens, Ph.D. | 473 | |
Elias A. Zerhouni, MD. | 549 |
33 |
DIRECTOR INDEPENDENCE AND RELATED PERSON TRANSACTIONS
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 List-Stoll,List, Messrs. Ehrlich,Dewan, Lohr, Sanders, Schwieters and Spoon, Professor Stevens and Dr.Drs. Mega and Zerhouni are independent within the meaning of the listing standards of the NYSE. Prior to his resignation from the Board in February 2018, the Board had also determined that Mr. Hugin was independent within the meaning of the listing standards of the NYSE. The Board concluded that none of these directors possesses (or in Mr. Hugin’s case possessed) any of the bright-line relationships set forth in the listing standards of the NYSE that prevent independence, or except as discussed below, any other relationship with Danaher other than Board membership.
In making its determination with respect to the independence of the directors identified above as independent, the Board considered that in 2017,2022, certain of the Company and itsCompany’s subsidiaries sold products and/or services to and purchased products and/or services from organizations with whom suchcertain of the independent directors are or were employed. In each such case, the amount of sales and the amount of purchases in 2017 were less than 0.4%1.0% of the annual revenues of such other organization and of Danaher’s 2017 revenues and2022 revenues. The Board also considered that all of the transactions referenced in the prior sentence were conducted in the ordinary course of business on commercial terms and on an arms’-length basis.
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. In addition, at least once each year Danaher’s independent directors meet in executive session following a regularly-scheduled Board meeting, and the Lead Independent Director chairs such sessions as well.
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.consummation. 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.
For their service as executive officers, in 2022 each of Steven Rales and Mitchell Rales received a salary of $419,000 and 401(k) Plan contributions of $19,130 during 2017 and iswas entitled to participate in all of the benefits made generally available to salaried employees as well as all perquisites made generally available to Danaher’s executive officers. Steven Rales also received a 401(k) plan contribution of $21,244 and Mitchell Rales received a 401(k) plan contribution of $3,771 and a non-elective contribution of $19,406 into his ECP account. The Rales’ do not receive cash incentive compensation or equity awards. In 2017,2022, Danaher provided to the Rales’ tax and accounting services to the Rales’ at a cost to Danaher of approximately $250,000$330,319 in the form of one full-time employee (plus health and welfare benefits for thesuch employee), allowed the Rales’ to make personal use of designated Danaher office space at a cost to Danaher of approximately $440,000$301,105 and provided Mr. Steven Rales with a personal car and parking at a cost to Danaher of $3,708.approximately $3,865. The incremental cost to the Company of the perquisites set forth above is based on the Company’sout-of-pocket costs. Danaher also provided a full-time executive assistant to each of the Rales’ to support them in their roles as Danaher executive officers. In each case, their use of a minority of their assistant’s time for non-Danaher matters resulted in no incremental cost to Danaher. Separately, in 2017,2022, Steven Rales and Mitchell Rales paid Danaher approximately $170,000$145,000 for providing benefits for, and as reimbursement for paying a portion of the salaries of, two persons who provide services to the Rales’.
Steven Rales and Mitchell Rales collectively own more than 10% of the equity of Colfax Corporation, a publicly traded industrial technology company that provides air & gas handling and fabrication technology products and services. Certain of our subsidiaries sell products and services to, and/or purchase products and services from, Colfax from time to time in the ordinary course of business and on an arms’-length basis. In 2017, our subsidiaries sold approximately $560,000 of products to, and purchased approximately $55,000 of products from, Colfax, which in each case is less than 0.02% of Colfax’s, and of Danaher’s, revenues for 2017. Our subsidiaries intend to sell products and services to and purchase products and services from Colfax in the future in the ordinary course of their businesses and on an arms’-length basis.
On July 2, 2016, we completed thespin-off (“Separation”) of Fortive Corporation (“Fortive”), consisting of our former Test & Measurement segment, Industrial Technologies segment (excluding the product identification businesses) and retail/commercial petroleum business. Following the Separation, Danaher and Fortive operate as separate publicly-traded companies and neither entity
34 |
Back to Contents |
|
has any ownership interest in the other. However, Steven Rales and Mitchell Rales collectively own more than 10% of the equity of Fortive. In connection with the Separation, Danaher and Fortive entered into various agreements to effect the Separation and provide a framework for their relationship after the Separation, including a transition services agreement, an employee matters agreement, a tax matters agreement, an intellectual property matters agreement and a license agreement with respect to the Danaher Business System, or DBS (a proprietary set of business processes and methodologies we use that are designed to continuously improve business performance). These agreements provide for the allocation between Danaher and Fortive of assets, employees, liabilities and obligations (including investments, property and employee benefits andtax-related assets and liabilities) attributable to periods prior to, at and after Fortive’s separation from Danaher and govern certain relationships between Danaher and Fortive after the Separation. In addition, following the Separation certain of our subsidiaries sell products and services to, and/or purchase products and services from, Fortive from time to time in the ordinary course of business and on an arms’-length basis. In 2017, Danaher collected on Fortive’s behalf, and remitted to Fortive, approximately $11.0 million relating to procurement, compensation and other matters, and billed Fortive approximately $2.1 million for transition services. Our subsidiaries sold approximately $12.7 million of products and services to, and purchased approximately $17.8 million of products and services from, Fortive, which in each case is less than 0.3% of Fortive’s, and of Danaher’s, revenues for 2017. Our subsidiaries intend to sell products and services to and purchase products and services from Fortive in the future in the ordinary course of their businesses and on an arms’-length basis.
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 ownedcontrolled by Mitchell Rales and Joust III is ownedcontrolled by Steven Rales. Under the management agreements, FJ900 performs management services for the respective aircraft owned by each of the Joust entities in like manner to the management services provided by FJ900 for Danaher’s aircraft. The management services provided by FJ900 include the provision of aircraft management, pilot services, maintenance, record-keeping, aircraft procurement and disposition and other aviation services. FJ900 receives no compensation for its services under the agreements. Having FJ900 perform management services for all of these aircraft enables Danaher and the Joust entities to share certain fixed expenses relating to the use, maintenance, storage, operation and supervision of their respective aircraft and utilize joint purchasing or joint bargaining arrangements where applicable and appropriate, allowing each party to benefit from efficiencies of scale and cost savings. We believe that this cost-sharing arrangement results in lower costs to Danaher than if we incurred these fixed costs on a stand-alone basis. Under the agreement, FJ900 prorates all shared expenses annually among the Joust entities and Danaher based primarily on each party’s flight hours logged for the year. The Joust entitiespre-pay FJ900 on a quarterly basis for their estimated, prorated portion of such shared expenses, and the amounts are trued up at the end of the year. With respect to the year ended December 31, 2017,2022, the Joust entities together paid FJ900 approximately $3$3.6 million for the Joust entities’ share of the fixed airplane management expenses shared with Danaher. Each Joust entity pays directly all expenses attributable to its aircraft that are not shared. Under the management agreements, each party is also required to maintain a prescribed amount of comprehensive aviation liability insurance and name the other party and its affiliates as additional named insureds, while the Joust entities must also maintainall-risk hull insurance for their aircraft. If either party suffers any losses in connection with the arrangements set forth in the management agreement, and such losses are due to the fault, negligence, breach or strict liability of the other party, the sole recourse of the party incurring the loss against the other party is to the available insurance proceeds. Each management agreement may be terminated by any party upon 30 days’ notice.
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, 2017,2022, the incremental value of the use of the Joust aircraft by Danaher, net of the incremental value of the use of the Danaher aircraft by the Joust entities, was approximately $55,000.$45,000. The owner of each aircraft, as operator of the aircraft, is responsible for providing a flight crew for all flights operated under the interchange agreement. Each owner/operator is required to maintain standard insurance, includingall-risk hull insurance and a prescribed amount of comprehensive aviation liability insurance, and to name the other party and its affiliates as additional named insureds. With respect to any losses suffered by the party using the owner/operator’s plane, the using party’s recourse against the owner/operator is limited to the amount of available insurance proceeds. To the extent the using party and/or any third party suffers losses in connection with the using party’s use of the owner/operator’s aircraft, and recovers from the owner/operator an amount in excess of the available insurance proceeds, the using party will indemnify the owner/operator for all such excess amounts. The interchange agreements may be terminated by either party upon 10 days’ notice.
Following market close on July 22, 2022, Walter G. Lohr, Jr., a member of the Board, exercised a stock option to purchase 3,906 shares of Danaher common stock and sold the resulting shares (net of 642 shares Danaher withheld to account for the exercise price) to Danaher at a per-share sale price equal to the closing price of Danaher’s common stock on such date, for an aggregate sale price of $1,069,689. Structuring the option exercise in this way obviated any filing requirement by Mr. Lohr under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, resulting in significant cost savings to Danaher.
35 |
BENEFICIAL OWNERSHIP OF DANAHER COMMON STOCK BY
DIRECTORS, OFFICERS AND PRINCIPAL SHAREHOLDERS
The following table sets forth as of March 12, 20181, 2023 (unless otherwise indicated) the number of shares and percentage of Danaher Common Stock beneficially owned by (1) each person who owns of record or is known to Danaher to beneficially own more than five percent of Danaher’s Common Stock, (2) each of Danaher’s directors and named executive officers, and (3) all executive officers and directors of Danaher as a group.
NAME |
NUMBER OF SHARES BENEFICIALLY OWNED (1) |
PERCENT OF CLASS (1) | NOTES | |||||||||||
Donald J. Ehrlich | 166,262 | * | Includes options to acquire 46,862 shares, 2,600 shares owned by Mr. Ehrlich’s spouse and 32,000 other shares owned indirectly. Mr. Ehrlich disclaims beneficial ownership of the shares held by his spouse.
| |||||||||||
Linda Hefner Filler | 80,845 | * | Includes options to acquire 57,440 shares and 3,068 phantom shares attributable to Ms. Hefner Filler’s account under theNon-Employee Directors’ Deferred Compensation Plan.
| |||||||||||
Thomas P. Joyce, Jr. | 557,647 | * | Includes options to acquire 386,055 shares, 4,020 shares attributable to Mr. Joyce’s 401(k) account and 149,590 shares attributable to Mr. Joyce’s EDIP account.
| |||||||||||
Teri List-Stoll | 24,420 | * | Includes options to acquire 20,920 shares and 3,500 phantom shares attributable to Ms. List-Stoll’s account under theNon-Employee Directors’ Deferred Compensation Plan.
| |||||||||||
Walter G. Lohr, Jr. | 533,708 | * | Includes options to acquire 46,862 shares, 38,846 shares held by a charitable foundation of which Mr. Lohr is president and 448,000 other shares held indirectly. Mr. Lohr disclaims beneficial ownership of the shares held by the charitable foundation.
| |||||||||||
Mitchell P. Rales | 37,015,156 | 5.3 | % | Includes 34,000,000 shares owned by limited liability companies of which Mr. Rales is the sole member, 192,774 shares attributable to Mr. Rales’ 401(k) Plan account and 2,369,911 other shares owned indirectly. The shares held by the limited liability companies are pledged to secure lines of credit with certain banks and each of these entities and Mr. Rales is in compliance with these lines of credit. The business address of Mitchell Rales, and of each of the limited liability companies, is 11790 Glen Rd., Potomac, MD 20854.
| ||||||||||
Steven M. Rales | 43,149,931 | 6.2 | % | Includes 34,000,000 shares owned by limited liability companies of which Mr. Rales is the sole member, 18,191 shares attributable to Mr. Rales’ 401(k) Plan account and 117,000 shares owned by a charitable foundation of which Mr. Rales is a director. Mr. Rales disclaims beneficial ownership of those shares held by the charitable foundation. The shares held by the limited liability companies are pledged to secure lines of credit with certain banks and each of these entities and Mr. Rales is in compliance with these lines of credit. The business address of Steven Rales, and of each of the limited liability companies, is 2200 Pennsylvania Avenue, N.W., Suite 800W, Washington, D.C. 20037-1701.
| ||||||||||
John T. Schwieters | 65,815 | * | Includes options to acquire 46,862 shares.
| |||||||||||
Alan G. Spoon | 99,566 | * | Includes options to acquire 46,862 shares.
| |||||||||||
Raymond C. Stevens, Ph.D. | 4,633 | * | Includes options to acquire 3,540 shares and 1,093 phantom shares attributable to Professor Stevens’ account under theNon-Employee Directors’ Deferred Compensation Plan.
| |||||||||||
Elias A. Zerhouni, M.D. | 43,784 | * | Includes options to acquire 36,284 shares and 7,500 other shares held indirectly.
|
Name | Number of Shares Beneficially Owned(1) | Percent of Class(1) | Notes | |||
Rainer M. Blair | 225,742 | * | Includes options to acquire 183,539 shares and 11,438 shares attributable to his account in the Company’s deferred compensation program. | |||
Feroz Dewan | 1,076 | * | Includes options to acquire 829 shares and 248 phantom shares attributable to his account under the Non-Employee Directors’ Deferred Compensation Plan. | |||
Linda Filler | 54,344 | * | Includes options to acquire 21,487 shares and 7,801 phantom shares attributable to her account under the Non-Employee Directors’ Deferred Compensation Plan. | |||
Teri List | 31,664 | * | Includes options to acquire 24,977 shares and 6,687 phantom shares attributable to her account under the Non-Employee Directors’ Deferred Compensation Plan. | |||
Walter G. Lohr, Jr. | 452,727 | * | Includes options to acquire 24,977 shares, 36,750 shares held by a charitable foundation of which Mr. Lohr is president and 391,000 other shares held indirectly. Mr. Lohr disclaims beneficial ownership of the shares held by the charitable foundation. | |||
Jessica L. Mega, MD, MPH | 4,805 | * | Consists of options to acquire 4,805 shares. | |||
Mitchell P. Rales | 35,133,350 | 4.8% | Includes 25,671,000 shares owned by limited liability companies of which a revocable trust controlled by Mr. Rales is the sole member, 213 shares attributable to Mr. Rales’ 401(k) Plan account, 4,256 shares attributable to Mr. Rales’ account in the Company’s deferred compensation program, 50,156 shares underlying Mandatory Convertible Preferred Shares of the Company owned indirectly (based on the minimum conversion rate for each preferred share), 6,947,890 shares attributable to a charitable foundation of which Mr. Rales is a director (consisting of 6,822,500 common shares and an additional 125,390 common shares underlying Mandatory Convertible Preferred Shares of the Company) and 2,459,835 other shares owned indirectly. Mr. Rales disclaims beneficial ownership of those shares held by the charitable foundation. 26,521,000 of the shares held by the limited liability companies or otherwise owned indirectly and 5,904,000 of the shares held by the charitable foundation are pledged to secure lines of credit with certain banks and each of these entities and Mr. Rales is in compliance with these lines of credit. The business address of Mitchell Rales, and of each of the limited liability companies, is 11790 Glen Rd., Potomac, MD 20854. |
36 |
Back to Contents |
|
NAME |
NUMBER OF SHARES BENEFICIALLY OWNED (1) |
PERCENT OF CLASS (1) | NOTES | |||||||||||
Daniel L. Comas | 571,244 | * | Includes options to acquire 405,236 shares, 6,713 shares attributable to Mr. Comas’ 401(k) account, 44,656 shares attributable to Mr. Comas’ EDIP account, 2,543 shares held by Mr. Comas’ spouse and 38,804 shares held by a trust as to which Mr. Comas’ spouse is trustee. Mr. Comas disclaims beneficial ownership of the shares held by his spouse and by the trust.
| |||||||||||
Rainer M. Blair | 48,083 | * | Includes options to acquire 42,117 shares and 1,651 shares attributable to Mr. Blair’s EDIP account.
| |||||||||||
William K. Daniel II | 490,134 | * | Includes options to acquire 402,269 shares and 25,089 shares attributable to Mr. Daniel’s EDIP account.
| |||||||||||
Angela S. Lalor | 110,852 | * | Includes options to acquire 87,762 shares and 17,107 shares attributable to Ms. Lalor’s EDIP account.
| |||||||||||
T. Rowe Price Associates, Inc. | 44,827,919 | 6.4 | % | Derived from a Schedule 13G filed February 14, 2018 by T. Rowe Price Associates, Inc. (“Price Associates”), which sets forth their beneficial ownership as of December 31, 2017. According to the Schedule 13G, Price Associates has sole voting power over 13,912,016 shares and sole dispositive power over 44,827,919 shares. These shares are owned by various individual and institutional investors for which Price Associates serves as an investment adviser with power to direct investments and/or sole power to vote the securities. For purposes of the reporting requirements of the Securities Exchange Act, Price Associates is deemed to be a beneficial owner of such securities; however, Price Associates expressly disclaims that it is, in fact, the beneficial owner of such securities. The address of Price Associates is 100 E. Pratt Street, Baltimore, Maryland 21202.
| ||||||||||
The Vanguard Group | 42,725,220 | 6.1 | % | Derived from a Schedule 13G filed February 9, 2018 by The Vanguard Group, which sets forth their beneficial ownership as of December 31, 2017. According to the Schedule 13G, The Vanguard Group has sole voting power over 860,340 shares, shared voting power over 155,821 shares, sole dispositive power over 41,729,978 shares and shared dispositive power over 995,242 shares. The address of The Vanguard Group is 100 Vanguard Blvd., Malvern, Pennsylvania 19355.
| ||||||||||
BlackRock, Inc. | 40,984,366 | 5.9 | % | Derived from a Schedule 13G filed January 29, 2018 by BlackRock, Inc., which sets forth their beneficial ownership as of December 31, 2017. According to the Schedule 13G, BlackRock, Inc. has sole voting power over 34,399,059 shares and sole dispositive power over 40,984,366 shares. The address of BlackRock, Inc. is 55 East 52nd Street, New York, New York 10055.
| ||||||||||
All current executive officers and directors as a group (20 persons) | 83,605,149 | 11.9 | % | Includes options to acquire 2,117,684 shares, 221,711 shares attributable to executive officers’ 401(k) accounts, 350,926 shares attributable to executive officers’ EDIP accounts and 7,662 phantom shares attributable to directors’ accounts under theNon-Employee Directors’ Deferred Compensation Plan.
|
Name | Number of Shares Beneficially Owned(1) | Percent of Class(1) | Notes | |||
Steven M. Rales | 43,688,082 | 6.0% | Includes 31,000,000 shares owned by limited liability companies of which a revocable trust controlled by Mr. Rales is the sole member, 19,668 shares attributable to Mr. Rales’ 401(k) Plan account, 125,390 shares underlying Mandatory Convertible Preferred Shares of the Company owned indirectly (based on the minimum conversion rate), 6,628,284 shares attributable to a charitable foundation of which Mr. Rales is the director (consisting of 6,502,894 common shares and an additional 125,390 common shares underlying Mandatory Convertible Preferred Shares of the Company (based on the minimum conversion rate)), and 5,914,740 other shares owned indirectly. Mr. Rales disclaims beneficial ownership of those shares held by the charitable foundation. The shares held by the limited liability companies and 3,000,000 of the shares held by the charitable foundation are pledged to secure lines of credit with certain banks and each of these entities and Mr. Rales is in compliance with these lines of credit. The business address of Steven Rales, and of each of the limited liability companies, is 2200 Pennsylvania Avenue, N.W., Suite 800W, Washington, D.C. 20037-1701. | |||
Pardis C. Sabeti, MD, D.Phil | 6,434 | * | Consists of options to acquire 4,805 shares and 1,630 phantom shares attributable to her account under the Non-Employee Directors’ Deferred Compensation Plan. | |||
A. Shane Sanders | 2,890 | * | Consists of options to acquire 2,145 shares and 745 phantom shares attributable to his account under the Non-Employee Directors’ Deferred Compensation Plan. | |||
John T. Schwieters | 57,828 | * | Includes options to acquire 24,977 shares and 30,851 other shares held indirectly. | |||
Alan G. Spoon | 100,473 | * | Includes options to acquire 21,487 shares and 8,700 other shares owned indirectly. | |||
Raymond C. Stevens, Ph.D. | 16,798 | * | Includes options to acquire 12,145 shares and 4,654 phantom shares attributable to his account under the Non-Employee Directors’ Deferred Compensation Plan. | |||
Elias A. Zerhouni, MD | 32,477 | * | Includes options to acquire 24,977 shares and 7,500 other shares held indirectly. | |||
Matthew R. McGrew | 130,230 | * | Includes options to acquire 114,933 shares, 1,215 shares attributable to his account in the Company’s deferred compensation program and 8,753 shares attributable to his 401(k) account. | |||
Jennifer L. Honeycutt | 69,756 | * | Includes options to acquire 51,583 shares, 14,849 shares attributable to her account in the Company’s deferred compensation program and 2,005 shares attributable to her 401(k) account. | |||
Joakim Weidemanis | 277,544 | * | Includes options to acquire 249,736 shares and 17,710 shares attributable to his account in the Company’s deferred compensation program. | |||
Jose-Carlos Gutierrez-Ramos | 2,325 | * | Includes 635 shares attributable to his account in the Company’s deferred compensation program. | |||
The Vanguard Group | 54,428,553 | 7.5% | Derived from a Schedule 13G filed January 31, 2023 by The Vanguard Group, which sets forth their beneficial ownership as of December 31, 2022. According to the Schedule 13G, The Vanguard Group has shared voting power over 926,936 shares, sole dispositive power over 51,726,049 shares and shared dispositive power over 2,702,504 shares. The address of The Vanguard Group is 100 Vanguard Blvd., Malvern, Pennsylvania 19355. | |||
BlackRock, Inc. | 51,630,040 | 7.1% | Derived from a Schedule 13G filed January 31, 2023 by BlackRock, Inc., which sets forth their beneficial ownership as of December 31, 2022. According to the Schedule 13G, BlackRock has sole voting power over 46,173,024 shares and sole dispositive power over 51,630,040 shares. The address of BlackRock, Inc. is 55 East 52nd Street, New York, New York 10055. | |||
All current executive officers and directors as a group (22 persons) | 80,770,595 | 11.1% | Includes options to acquire 1,149,179 shares, 10,770 shares attributable to executive officers’ 401(k) accounts, 104,512 shares attributable to executive officers’ accounts in the Company’s deferred compensation program and 21,517 phantom shares attributable to directors’ accounts under the Non-Employee Directors’ Deferred Compensation Plan. |
(1) | Except as otherwise indicated and subject to community property laws where applicable, each person or entity included in the table above has sole voting and investment power with respect to the shares beneficially owned by that person or entity. |
* | Represents less than 1% of the outstanding Danaher Common Stock. |
37 |
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, 2018.2023. Representatives of Ernst & Young LLP are expected to be present at the Annual Meeting, will have the opportunity to make a statement if they desire to do so and will be available to respond to appropriate questions. Although shareholder approval of the selection of Ernst & Young LLP is not required by law, Danaher’s Board believes that it is advisable to give shareholders an opportunity to ratify this selection. If this proposal is not approved by Danaher’s shareholders at the 20182023 Annual Meeting, the Audit Committee will reconsider its selection of Ernst & Young LLP. Even if the selection of Ernst & Young LLP is ratified, the Audit Committee in its discretion may select a different independent registered public accounting firm at any time during the year if it determines that such a change would be in the best interests of Danaher and its shareholders.
The Board of Directors recommends that shareholders vote FOR ratification of the selection of Ernst & Young LLP to serve as the independent registered public accounting firm for Danaher for 2018.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR RATIFICATION OF THE SELECTION OF ERNST & YOUNG LLP TO SERVE AS THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR DANAHER FOR 2023. |
The following table sets forth the fees for audit, audit-related, tax and other services rendered by Ernst & Young LLP to Danaher for 20172022 and 2016.2021.
TWELVE MONTHS ENDED |
TWELVE MONTHS ENDED | |||||||
Audit Fees. Fees for the audit of annual financial statements and internal control over financial reporting, reviews of quarterly financial statements, statutory audits required internationally, audit of captive insurance company, consents, review of documents filed with the SEC, and other services normally provided by the auditor in connection with statutory and regulatory filings or engagements.
| $
| 20,054,000
|
| $
| 21,273,000
|
| ||
Audit-Related Fees. Fees for assurance and related services reasonably related to the performance of the audit or review of financial statements and internal control over financial reporting that are not reported under “Audit Fees” above, including audits of entities not otherwise required in connection with statutory or regulatory filings and employee benefit plan audits.
| $
| 973,757
|
| $
| 566,190
|
| ||
Tax Fees. Aggregate fees for professional services rendered by Ernst & Young LLP for tax compliance, tax advice and tax planning. (1)
| $
| 5,786,180
|
| $
| 6,726,823
|
| ||
All Other Fees. Aggregate fees for products and services provided by Ernst & Young LLP, other than the services reported under “Audit Fees,” “Audit-Related Fees” or “Tax Fees” above.
|
| 0
|
|
| 0
|
|
Twelve Months Ended December 31, 2022($) | Twelve Months Ended December 31, 2021($) | ||
Audit Fees. Fees for the audit of annual financial statements and internal control over financial reporting, reviews of quarterly financial statements, and the services that an independent auditor would customarily provide in connection with subsidiary audits, statutory requirements, regulatory filings and similar engagements, such as comfort letters, attest services, consents, and assistance with review of documents filed with the SEC. Audit fees also include advice about accounting matters that arose in connection with or as a result of the annual audit or the review of quarterly financial statements and statutory audits that non-U.S. jurisdictions require. | 23,328,284 | 23,881,753 | |
Audit-Related Fees. Fees for assurance and related services reasonably related to the performance of the audit or review of financial statements and internal control over financial reporting that are not reported under “Audit Fees” above. This category may include fees related to the performance of audits and attest services not required by statute or regulations; audits of our employee benefit plans; due diligence related to mergers, acquisitions, and investments; accounting consultations about the application of GAAP to proposed transactions; and in 2022 includes audits and audit related services in connection with the planned separation of the Company’s EAS segment. | 5,298,930 | 460,505 | |
Tax Fees. Fees for professional services related to tax compliance and return preparation, tax advice and tax planning.(1) | 7,141,691 | 5,748,758 | |
All Other Fees. Fees for products and services other than as reported under “Audit Fees,” “Audit- Related Fees” or “Tax Fees” above. | — | 10,000 |
(1) | The nature of the services comprising the fees disclosed under “Tax Fees” is as follows: |
TWELVE MONTHS ENDED DECEMBER 31, 2017 | TWELVE MONTHS ENDED DECEMBER 31, 2016 | |||||||
Tax Compliance. Includes tax compliance fees charged by Ernst & Young LLP for tax return review and preparation services and assistance related to tax audits by regulatory authorities.
| $
| 3,987,888
|
| $
| 2,653,973
|
| ||
Tax Consulting. Includes tax consulting services rendered by Ernst & Young LLP, including assistance related to tax planning.
| $
| 1,798,292
|
| $
| 4,072,850
|
|
Twelve Months Ended December 31, 2022($) | Twelve Months Ended December 31, 2021($) | |||
Tax Compliance. Includes tax compliance fees for tax return review and preparation services and assistance relatedto tax audits by regulatory authorities. | 4,437,661 | 3,229,028 | ||
Tax Consulting. Includes tax consulting services, including assistance related to tax planning. | 2,704,030 | 2,519,730 |
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 theirsuch firm’s independence.
38 |
Back to Contents |
|
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 categoriesofcategories of non-audit services that may be performed by the independent auditor during the year, subject to certain dollarmonetary limits. With respect toadditional non-audit services by the independent auditors that either are not covered bythe pre-approved categories, or exceedthe pre-approved dollarmonetary limits, the Committee approves or rejects each engagement. In each case, the Committee takes into account whether the services are permissible under applicable law and the possible impact of eachnon-audit service on the independent registered public accounting firm’s independence from management. The Committee may delegate to a subcommittee of one or more members the authority to grant preapprovals of audit and permittednon-audit services, and the decisions of such subcommittee to grant preapprovals must be presented to the full Committee at its next scheduled meeting. The Committee has not made any such delegation as of the date of this Proxy Statement.
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 auditors,registered public accounting firm, the performance of Danaher’s internal audit function, Danaher’s compliance with legal and regulatory requirements, Danaher’s major financial risk exposures, significant legal, compliance, reputational, cybersecurity and cyber securityprivacy risks and overall risk assessment and risk management policies, and Danaher’s swaps and derivatives transactions and related policies and procedures.
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 2018.2023. The Audit Committee evaluates Ernst & Young’s performance at least annually. In evaluating Ernst & Young and determining whether to reappoint the firm as Danaher’s independent registered public accounting firm, the Audit Committee took into consideration a number of factors, including the firm’s tenure, independence, global capability and expertise and performance. Ernst & Young has been retained as Danaher’s independent registered public accounting firm continuously since 2002. The Audit Committee periodically considers the advisability and impact of rotating our independent registered public accountants. In conjunction with the mandated rotation of Ernst & Young’s lead engagement partner every five years, the Audit Committee and(including its chairchair) are directly involved in the selection of Ernst & Young’s new lead engagement partner. The Audit Committee is also responsible for the audit fee negotiations associated with Danaher’s retention of Ernst & Young. Danaher’s Board of Directors and Audit Committee believe they have undertaken appropriate steps with respect to oversight of Ernst & Young’s independence and that the continued retention of Ernst & Young to serve as Danaher’s independent registered public accounting firm is in the best interests of Danaher and its shareholders.
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 thethose matters required to be discussed by Auditing Standard No. 1301, “Communications with Audit Committees,” as adopted byunder the applicable requirements of the Public Company Accounting Oversight Board (PCAOB).(“PCAOB”) and the SEC. In addition, the Audit Committee has received the written disclosures and the letter from Ernst & Young required by the PCAOB regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence, and has discussed with Ernst & Young its independence. The Audit Committee has concluded that Ernst & Young’s provision ofnon-audit services as described in the table on page 19above is compatible with Ernst & Young’s independence.
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, 20172022 be included in Danaher’s Annual Report on Form10-K for the year ended December 31, 20172022 for filing with the SEC.
Audit Committee of the Board of Directors
John T. Schwieters (Chair)
Donald J. Ehrlich
Teri List-StollList
Walter G. Lohr, Jr.
A. Shane Sanders
39 |
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:
In 2022, as the world faced the evolution of COVID-19 from pandemic toward endemic status, widespread inflation and supply chain disruptions and economic slowdowns across many major geographies, Danaher remained focused on growing its business in the near-term while continuing to invest in long-term growth. Specifically, in 2022 Danaher:
• | Continued to evolve its portfolio by announcing the intention to separate its Environmental & Applied Solutions segment in the fourth quarter of 2023 to create a separate, publicly traded company (to be known as Veralto Corporation), which will further advance Danaher’s science and technology transformation. |
• | Invested aggressively in future growth, including investments of approximately $1.7 billion in research and development, $1.2 billion in acquisitions and strategic investments and $1.2 billion in capital expenditures. |
• | Returned approximately $700 million to common shareholders through cash dividends (marking the 30th year in a row Danaher has paid a dividend on its common shares) |
• | Increased revenues by 7% and net earnings attributable to common shareholders by 13.5% on a year-over-year basis, and generated more than $8 billion of operating cash flow. |
COMPENSATION DISCUSSION AND ANALYSISFor a further discussion of Danaher’s business performance in 2022 and over the long term, please see “Proxy Statement Summary – Business Highlights.”
The following section discusses and analyzes the compensation provided to each of the executive officers set forth in the Summary
2023 PROXY STATEMENT | 40 |
Executive Summary
Introduction
With the goal of building long-term value for our shareholders, we have developedmaintain 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 goals and objectives that we believe best correlate with the creation of long-term shareholder value, including financial and strategic as well as sustainability-related objectives. |
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 buildhelp increase long-term shareholder value, achieve annual business goals and maintainbuild long-term careers with Danaher.
2017
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 paid by 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.
Danaher’s Compensation Committee regularly reviews our executive compensation program with a view toward continuous improvement and consideration of investor feedback. As a result of this review, effective in 2022 the Committee shortened the vesting period for the stock options granted to executive officers to four years. The Committee concluded that a four-year vesting period for stock options most effectively balances (1) retention considerations in an increasingly competitive market for executive talent, and (2) the traditional, long-term focus of our executive compensation program.
In recent years, the Committee has made other enhancements to the program 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. These improvements have included the introduction of a core revenue growth performance metric in our executive short-term incentive compensation program; and an executive long-term incentive compensation program that is entirely performance-based.
The Committee has enhanced our executive compensation program over the last several years to reinforce our performance-oriented culture and expects to continue to improve the program as appropriate, but also believes that consistent use of best-practice designs is important in effectively communicating key messages to our executives. As a result, the Committee does not revise the program to align with emerging trends unless it sees a clear business rationale for Danaher.
We provide our shareholders the opportunity to cast an annual advisory vote with respect to our named executive officerNEO compensation as disclosed in our annual proxy statement (the “say on pay proposal”).At our annual meeting of shareholders in May 2017, 97%2022, 94% of the votes cast on the say on pay proposal were voted in favor of the proposal.The Committee believes this result affirms shareholders’ support of the Company’s named executive officerNEO compensation and did not make changes to the Company’s executive compensation program as a result of such vote.
2017 Performance
In 2017, Danaher:
2023 PROXY STATEMENT |
DANAHER 2016-2017 YEAR-OVER-YEAR GROWTH FROM CONTINUING OPERATIONS
Revenue Growth 8.5% Operating Cash Flow Growth 12.5% EARNINGS GROWTH 14.5%
|
#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%
Long-Term Performance
|
Danaher’s compounded, average annual shareholder return has outperformed the S&P 500 Index over each of the last three, five-,ten-, fifteen-, twenty- and twenty-five year periods:
|
20172022 Executive Compensation
The chart below summarizes key information with respect to each pay element represented in Danaher’s 20172022 executive compensation program:
Pay Element | Primary Objectives | Form | Performance Requirement | Key Committee Considerations in Determining 2022 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 |
•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 officers, such as in connection with new hires or promotions or for retention purposes. A portion of the |
| ||||||||||||||||
Performance | •3-year relative TSR (and average ROIC performance •2-year holding period (incremental to 3-year performance period) | ||||||||||||||||||||
|
|
|
|
|
|
|
| ||||||||||
Annual Cash Incentive Compensation | • Motivate executives to achieve near-term operational and financial goals that support our long-term business objectives and strategic priorities • Attract, retain and motivate skilled executives • Allow for meaningful pay differentiation tied to annual performance of individuals and groups | Cash | This pay element represented the second-most significant |
| |||||||||||
| |||||||||||||||
| |||||||||||||||
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 |
| ||||||||||
|
2023 PROXY STATEMENT | 42 |
Pay Element | Primary Objectives | Form | Performance Requirement | Key Committee Considerations in Determining 2022 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 | |
“Adjusted Diluted Earnings Per Share” or “Adjusted EPS” means the Company’s “Adjusted Diluted Net Earnings Per Common Share” from continuing operations for the fiscal yearending December 31, 2022 as reported on a Current Report on Form 8-K furnished by the Company on January 24, 2023 (“Form 8-K”), but excluding: (1) the impact of any changein accounting principles that occurred during the performance period and the cumulative effect thereof, to the extent such change was not considered in establishing targetperformance levels (the Committee may either apply the changed accounting principle to the performance period, or exclude the impact of the change in accounting principle fromthe period); and (2)(i) all transaction and financing costs directly related to the acquisition of any whole or partial interest in a business, (ii) all restructuring charges directly relatedto or arising from any business as to which the Company acquired a whole or partial interest and incurred within two years of the acquisition date, (iii) all charges and gains arisingfrom the resolution of contingent liabilities identified as of the acquisition date and related to any business as to which the Company acquired a whole or partial interest, (iv) all othercharges directly related to the acquisition of any whole or partial interest in a business and incurred within two years of the acquisition date, and (v) all gains or charges associatedwith the operation of any business as to which the Company acquired a whole or partial interest on or after January 1, 2022; provided, that with respect to the gains and chargesreferred to in sections (2)(iii) and (2)(iv) above, only gains or charges that individually or as part of a series of related items exceeded $10 million during the performance period areexcluded. | |
“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 currencytranslation. Sales attributable to acquired businesses refers to sales from acquired businesses recorded prior to the first anniversary of the acquisition less the amount of salesattributable 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) afterapplying current period foreign exchange rates to the prior year period. | |
“Adjusted Free Cash Flow-to-Adjusted Net Income Ratio” or “Free Cash Flow Ratio” is defined as (A) the Company’s GAAP operating cash flow from continuing operations for theyear ended December 31, 2022, less 2022 purchases of property, plant and equipment from continuing operations (net of proceeds from the sale of property, plant and equipment);but excluding the cash flow impact of any discrete tax item in excess of $10 million or any other item that is excluded from Adjusted EPS, divided by (B) the Company’s Adjusted NetIncome. “Adjusted Net Income” means the Company’s net income from continuing operations for the year ended December 31, 2022 as determined pursuant to GAAP, but excludingthe same adjustment items reflected in the calculation of Adjusted EPS. “Adjusted Net Income” means the Company’s net income from continuing operations for the year ended December 31, 2022 as determined pursuant to GAAP, but excluding the same adjustment items reflected in the calculation of Adjusted EPS. |
43 |
Back to Contents |
|
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. Below are highlights of our 2022 executive compensation program:
WHAT WE DO | WHAT WE DON’T DO | ||||||
| No tax gross-up provisions | ||||||
Incentive compensation programs feature multiple, differentperformance measures aligned with | No dividend/dividend equivalents paid on unvestedequity 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 | ||||||
Limited perquisites and a cap on CEO/CFO personal aircraft usage | No | ||||||
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 2022 executive compensation program.
ATTRIBUTE | KEY RISK MITIGATING EFFECT | ||
• Emphasis on long-term, equity-based compensation • • Rigorous, no-fault clawback policy that is triggered even in the absence of wrongdoing | • 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 • 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 | • |
| |
• 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 • Provides Compensation Committee the opportunity as appropriate to adjust awards based on how results are achieved | ||
• Independent compensation consultant | • Helps ensure advice will not be influenced by conflicts of interest |
44 |
|
Overview
In determining the appropriate mix and amount of compensation elements for each named executive officerNEO for 2017,2022, 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 – 2017“Executive Summary –2022 Executive Compensation.” The graphics below illustrate, for the CEOMr. Blair and separately for the other NEOs in aggregate, the percentage of 20172022 compensation that each element of compensation accounted for (based on the amounts reported in the 20172022 Summary Compensation Table):
Amounts may not total 100% due to rounding
2017 Target Award Values
In February 2017,2022, the Committee subjectively determined the target dollar value of annual equity compensation to be delivered to each named executive officerNEO in 2017,2022, 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. Blair’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 2022, the Committee considered in particular Mr. Blair’s effective leadership during the following factors. In light ofpandemic; 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 underduring his leadership (subject to time-basedtenure; and performance-based vesting criteria that link the ultimate, realized value of such awards tohis progress in further refining and improving the Company’s performance over the next several years). The Committee also took into account:strategy planning and development processes.
|
2017 Equity Award Mix
With respect to each of the named executive officer 2017NEO 2022 annual equity awards,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:
• | 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 2022 NEO stock options vest over four years and our 2022 NEO PSUs are subject to a three-year performance period and a further two-year holding period. In aggregate, these periods promote stability and encourage officers to take a long-term view of our performance. |
2023 PROXY STATEMENT | 45 |
• | Effective in 2022, the Committee shortened the vesting period for executive stock options to four years. The Committee continually assesses the effectiveness of our executive compensation program, and concluded that a four-year vesting period for stock options most effectively balances (1) retention considerations in an increasingly competitive market for executive talent, and (2) the traditional, long-term focus of our executive compensation program. |
• | 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 executive officer 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.
RELATIVE TSR
The number of stock market declines or modest growth they are more likelyshares of Common Stock that vest pursuant to support our talent retention objectives.
2017the 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 |
| |||
Below 35thpercentile | ||||
35thpercentile | ||||
55thpercentile | ||||
75thpercentile or above |
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(2) (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% |
(2) | “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. |
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
2023 PROXY STATEMENT | 46 |
VESTING AND HOLDING PERIOD
With respect to 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.
AnyPSUs granted in 2022, 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 during the performance period the executive receives a prorated portion of the shares actually earned based on 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
2015-20172020-2022 Performance Period
PSUs for the 2015-20172020-2022 performance period, which ended December 31, 2017,2022, were earned and certified in February 20182023 based on an earned payout percentage of 140%200%, resulting from the Company’s three-year absolute TSR of 46.30%64.58% ranking in the 6384rdth percentile relative to the TSRs of the companies in the S&P 500 indexIndex as of the beginning of the performance period (January 1, 2015)(February 24, 2020). The Company’s Three-Year Average ROIC Change with respect to these PSUs was +469 basis points, but because the ROIC Modifier Factor cannot increase the earned payout percentage above 200%, it had no impact on the earned payout percentage. These PSUs remain subject to a furthertwo-year mandatory holding period that runs through 2019.2024.
|
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.
2017 Annual Incentive Awards
The diagram below illustrates the 20172022 annual incentive award opportunities the Committee determined for the Company’s named executive officers,NEOs in May 2022 under the Omnibus Plan, each element of which is further described below.
Target Bonus Percentage and Personal Payout Percentage
.
In February 2017,May 2022, 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.
2023 PROXY STATEMENT | 47 |
|
Percentage |
| ||
President and Chief Executive Officer | 200% |
| ||
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, | |||
Joakim Weidemanis Executive Vice President | 125% | Consisted of the degree of year-over-year improvement in core revenue, operating profit margin and working capital turnover for his business units;return-on-invested-capital performance achieved with respect to acquisitions by his business units; quantitative goals for his business units relating to |
capabilities. | ||
|
|
|
| ||
| ||||
115% | Consisted of |
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.typically pay to executives serving in comparable roles. With respect to Mr. JoyceBlair in particular, although the Committee did not target the performance-based portion of histhe CEO’s annual cash compensation at any particular percentage of histotal 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 2017,2022, 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 cash incentive compensation awards is an important element in reaching balanced compensation decisions that are consistent with our strategy, reward both current year performance and sustained long-term value creation, and reward achievements that advance our sustainability strategy. 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 that occur during the performance period; and |
• | allows the Committee to adjust compensation based on factors that would not be appropriately reflected by a strictly formulaic approach focused solely on Company performance, such as advancing sustainability-related goals, 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 hertheir personal performance objectives for the year, the executive’s performance with respect to each of the Company’s five “Core Behaviors” (which are a set of standards and behaviors that Danaher associates are expected to aspire to and are 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
2023 PROXY STATEMENT | 48 |
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 2022 performance as a whole the Committee considered in particular the Company’s 2022 financial performance; the Company’s progress toward separating its EAS business to create a separate, publicly-traded company; 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 average Personal Payout Percentage of the NEOs (other than Mr. Blair) was 154%.
The Company awarded Mr. JoyceBlair a Personal Payout Percentage of 129%160% for 2017,2022, based primarily on his 2017 leadership with respect to the Company’s financial performance, talentand operational performance; progress toward its DE+I representation objectives; progress toward separating its EAS business to create a separate, publicly-traded company; and progress in further enhancing the Company’s innovation and strategy development processes, strategic allocation of capitaldirection and strengthening of our innovationscience and technology organization and capabilities.
The Company Payout Percentage is formulaic, based on the Company’s 20172022 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, to 150% (for Free Cash Flow Ratio100% for target performance and ROIC) or 200% (for Adjusted EPS) for performance that equalsequaled or exceedsexceeded the maximum. Under all Metrics, target performance yields 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 2017,2022, 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) |
2023 PROXY STATEMENT | 49 |
In evaluating the 2022 Company Payout Percentage, the Committee noted that the number of COVID-19 test cartridges actually sold by the Company in 2022 exceeded the level the Committee assumed when it set the Adjusted EPS and Core Revenue Growth target levels in May 2022. Taking this into consideration, the Committee exercised its negative discretion to reduce the 2022 Company Payout Percentage from 1.78 to 1.64 (which is the Company Payout Percentage the Committee determined would have resulted if actual 2022 results had matched the assumed levels of cartridge sales).
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 20172022 annual cash incentive compensation awards for each of the named executive officersNEOs are set forth in the Summary Compensation Table.
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 2017,2022, the Committee subjectively determined 20172022 base salaries for the named executive officers, as set forth in the Summary Compensation Table. Without giving specific weight to any particular factor,NEOs. 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.year (without giving specific weight to any particular factor). 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.
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. 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.
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.voluntary 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 their salary and/or up to 85% of their non-equity annual 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. |
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).
50 |
Back to Contents |
|
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.”
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 businesses and 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. The Committee periodically reviews the companies included in the peer group to ensure that the peer group remains appropriate.
For 2017,
Prior to September 2022, the Company’s peer group (for purposes of all 2022 executive compensation decisions) consisted of the following companies (the “peer companies”):set forth below:
3M Company | Biogen Inc. | |||
Abbott Laboratories | Boston Scientific Corporation | Medtronic Inc. | ||
Amgen Inc. | Ecolab Inc. | Roper Corporation | ||
Baxter International, Inc. | Honeywell International Inc. | Stryker Corporation | ||
Becton Dickinson & Co. | ||||
Thermo Fisher Scientific Inc. | ||||
|
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. As of September 2021 and based on Standard & Poor’s Capital IQ database, Danaher’s ranking within this peer group was 59th percentile for revenue, 93rd percentile for market capitalization, 68th percentile for net income (from continuing operations excluding extraordinary items), 88th percentile for total assets and 56th percentile for employees.
The Committee periodically reviews the companies included in the peer group to ensure that the peer group remains appropriate. In September 2022, the Committee evaluated the existing peer group with the assistance of FW Cook (using the same selection criteria described above) and replaced Biogen Inc., Illinois Tool Works Inc., and Roper Corporation with AbbVie Inc., Bristol-Myers Squibb Company, Eli Lilly and Company, and IQVIA Holdings Inc. The Committee made these updates to the peer group to better reflect the Company’s current size and portfolio of businesses. Set forth below is the Company’s peer group as of September 2022:
3M Company | Boston Scientific Corporation | IQVIA Holdings Inc. |
Abbott Laboratories | Bristol-Myers Squibb Company | Johnson & Johnson |
AbbVie Inc. | Ecolab Inc. | Medtronic Inc. |
Amgen Inc. | Eli Lilly and Company | Stryker Corporation |
Baxter International, Inc. | Honeywell International Inc. | Thermo Fisher Scientific Inc. |
Becton Dickinson & Co. |
2023 PROXY STATEMENT | 51 |
The table below sets forth for this updated 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)September 15, 2022), market capitalization (as of May 31, 2017)September 15, 2022) and employee headcount (based on each company’s most recent fiscal year end as of May 31, 2017)September 15, 2022), in each case derived from the Standard & Poor’s Capital IQ database.
($ IN MILLIONS)
| ||||||||||||||||||||||||||||||
REVENUE
| MARKET
| NET INCOME (BEFORE UNUSUAL OR INFREQUENTLY DISCONTINUED OPERATIONS)
| TOTAL ASSETS
| EMPLOYEES AT
| ||||||||||||||||||||||||||
($ IN MILLIONS, EXCEPT NUMBER OF EMPLOYEES) | Revenue | Market Capitalization | Net Income (From continuing operations excluding extraordinary items) | Total Assets | Employees | |||||||||||||||||||||||||
75th percentile
| $
| 28,516
|
| $
| 92,688
|
| $
| 3,673
|
| $
| 52,638
|
|
| 84,750
|
| $43,502 | $192,052 | $6,823 | $90,080 | 96,000 | ||||||||||
Median
| $
| 15,981
|
| $
| 60,516
|
| $
| 1,771
|
| $
| 30,140
|
|
| 49,464
|
| $30,070 | $119,799 | $5,143 | $56,247 | 67,500 | ||||||||||
25th percentile
| $
| 10,644
|
| $
| 37,394
|
| $
| 1,268
|
| $
| 19,547
|
|
| 36,250
|
| $16,770 | $63,462 | $1,715 | $35,071 | 44,750 | ||||||||||
Danaher
| $
| 17,164
|
| $
| 58,959
|
| $
| 2,051
|
| $
| 45,245
|
|
| 62,000
|
| $30,816 | $205,074 | $6,206 | $81,806 | 80,000 | ||||||||||
Danaher percentile rank
|
| 52
| %
|
| 49
| %
|
| 59
| %
|
| 68
| %
|
| 64
| %
| |||||||||||||||
DANAHER PERCENTILE RANK | 52% | 78% | 64% | 70% | 60% |
The peer group compensation data that the Committee reviewed in 20172022 in connection with its named executive officer 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.
Danaher’s compensation program is grounded on the principle that each executive officer position.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 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.”
2023 PROXY STATEMENT | 52 |
General
The Committee grants equityEquity awards are granted 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 advancetypically granted as of one of the calendarCompany’s four, standardized grant dates during the year, in which they occur),and may also be granted 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 Committeegrant approval or a specified date subsequent to the approval date as specified by the Committee.date. 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 executivesexecutive officers at the Committee’s regularly scheduled meeting in February, when the Committee reviews the performance of the executive officers and typically determines most or all of 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, using aas applicable, based on fair market value equalvalue. Prior to 2021, 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 not 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 equal tomodified Black Scholes calculation that utilized a multi-day average closing price and an assumed ten-year term. Beginning with the Averaging Period Closing Price forequity awards granted 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, in that year 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.
|
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 hertheir appointment to an executive position, as follows:
Title | Stock Ownership Multiple | |
Chief Executive Officer | ||
Executive Vice President | 3 times base salary | |
Senior Vice President | 2 times base salary |
What Counts as Ownership: | What Does Not Count as Ownership: | |
|
| |
• Notional shares of Danaher stock in the EDIP, ECP or DCP • Shares held in a 401(k) plan • Unvested RSUs • | • Unexercised stock options • Unvested PSUs |
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 officer serving as an executive officer as of December 31, 2017NEO was in compliance with the stock ownership requirements as of such date.December 31, 2022.
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.
2023 PROXY STATEMENT | 53 |
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.
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 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
• | all gains from equity awards
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 Regulatory |
54 |
2017
The following table sets forth the 20172022 compensation of (i) our President and Chief Executive Officer, (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, also2022, 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, | 2022 | 1,300,000 | 0 | 7,239,213 | 7,029,061 | 4,222,400 | 0 | 405,353 | 20,196,027 | |||||||||||||||||||||||||||
2021 | 1,200,000 | 0 | 5,124,383 | 6,260,494 | 4,128,000 | 0 | 439,390 | 17,152,267 | ||||||||||||||||||||||||||||
2020 | 949,067 | 0 | 3,616,939 | 2,968,651 | 2,519,339 | 0 | 342,765 | 10,396,761 | ||||||||||||||||||||||||||||
Matthew R. McGrew, Executive Vice President and CFO | 2022 | 878,460 | 0 | 2,197,854 | 2,133,848 | 1,783,270 | 0 | 189,912 | 7,183,344 | |||||||||||||||||||||||||||
2021 | 798,600 | 0 | 1,537,702 | 1,877,996 | 1,697,025 | 0 | 188,184 | 6,099,507 | ||||||||||||||||||||||||||||
2020 | 726,000 | 0 | 1,637,982 | 1,435,173 | 1,564,530 | 0 | 166,358 | 5,530,043 | ||||||||||||||||||||||||||||
Jennifer L. Honeycutt, Executive Vice President | 2022 | 802,500 | 0 | 1,680,547 | 1,631,738 | 1,548,830 | 0 | 206,589 | 5,870,204 | |||||||||||||||||||||||||||
2021 | 750,000 | 0 | 1,313,474 | 1,603,093 | 1,537,500 | 0 | 155,641 | 5,359,708 | ||||||||||||||||||||||||||||
Joakim Weidemanis, Executive Vice President | 2022 | 972,400 | 0 | 2,585,694 | 2,510,454 | 1,951,750 | 0 | 206,319 | 8,226,617 | |||||||||||||||||||||||||||
2021 | 936,000 | 0 | 2,049,947 | 2,504,501 | 1,965,600 | 0 | 157,966 | 7,614,014 | ||||||||||||||||||||||||||||
2020 | 881,560 | 0 | 5,065,095 | 4,551,242 | 1,917,000 | 0 | 138,301 | 12,553,198 | ||||||||||||||||||||||||||||
Jose-Carlos Gutierrez-Ramos, Senior Vice President | 2022 | 754,000 | 0 | 1,835,920 | 1,205,025 | 1,408,170 | 0 | 81,942 | 5,285,057 |
(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 DCP ($) | Amount of Non-Equity Incentive Compensation Deferred Into DCP ($) | ||||||||||||
Name of Officer |
2022 | 2021 | 2020 | 2022 | 2021 | 2020 | ||||||||
Rainer M. Blair | – | – | – | – | – | – | |||||||
| Matthew R. McGrew | – | – | – | – | – | – | ||||||
Jennifer L. Honeycutt | 64,119 | 59,915 | N/A | 774,415 | 768,750 | N/A | |||||||
Joakim Weidemanis | – | – | – | – | – | 383,400 | |||||||
Jose-Carlos Gutierrez-Ramos | – | N/A | N/A | – | N/A | N/A |
2023 PROXY STATEMENT | 55 |
(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: |
Name of Officer | Date of Grant | Risk-Free Interest Rate | Stock Price Volatility Rate | Dividend Yield | Option Life | ||||||
Blair, McGrew, Honeycutt, Weidemanis, Gutierrez-Ramos | February 24, 2022 | 1.94% | 30.23% | 0.37% | 7.5 years | ||||||
Blair, McGrew, Honeycutt, Weidemanis | February 24, 2021 | 1.08% | 31.39% | 0.38% | 7.5 years | ||||||
Blair, Weidemanis | May 15, 2020 | 0.54% | 30.49% | 0.44% | 8.0 years | ||||||
Blair, McGrew, Weidemanis | February 24, 2020 | 1.33% | 23.09% | 0.46% | 8.0 years |
All stock awards reflected in the table above were granted in the form of performance stock units (PSUs), except that Mr. Weidemanis’ May 2020 incremental stock award was granted in the form of time-vesting restricted stock units (RSUs) and a portion of Dr. Gutierrez-Ramos’ 2022 stock award was granted in the form of RSUs. With respect to RSUs, the grant date fair value under FASB ASC Topic 718 has been calculated using theBlack-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 | % |
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, McGrew, Honeycutt, Weidemanis, Gutierrez-Ramos | February 24, 2022 | 27.01% | 38.88% | 1.69% | 0.00% | 29.72% | 1.53% | 0.37% | |||||||||
Blair, McGrew, Honeycutt, Weidemanis | February 24, 2021 | 26.20% | 38.62% | 0.22% | 0.00% | 27.76% | 0.12% | 0.38% | |||||||||
Blair | May 15, 2020 | 25.39% | 36.96% | 0.18% | 0.00% | 27.13% | 0.16% | 0.44% | |||||||||
Blair, McGrew, Weidemanis | February 24, 2020 | 19.06% | 25.27% | 1.21% | 0.00% | 20.46% | 1.26% | 0.46% |
(3) | In 2022, the actuarial present value of |
(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) | $120,285 |
Company 401(k) Contributions ($) | Company EDIP/ECP Contributions ($) | Other ($) | Total 2022 All Other Compensation ($) | ||||||
Rainer M. Blair | 21,244 | 288,000 | 96,109 | (a) | 405,353 | ||||
Matthew R. McGrew | 21,244 | 107,811 | 60,857 | (b) | 189,912 | ||||
Jennifer L. Honeycutt | 21,244 | 168,750 | 16,595 | (c) | 206,589 | ||||
Joakim Weidemanis | 21,244 | 168,480 | 16,595 | (c) | 206,319 | ||||
Jose-Carlos Gutierrez-Ramos | 21,244 | 49,300 | 11,398 | (d) | 81,942 |
(a) | Includes |
|
fuel,on-board catering, maintenance expenses related to operation of the plane during the year, landing and parking fees, navigation fees, related ground transportation, crew accommodations and meals and supplies) per flight hour for the particular aircraft for the year, net of any applicable employee reimbursement. |
(b) | Includes | |
(d) | Consists of amounts related to commuting expenses and lodging, as well as tax preparation/professional services. |
The following table sets forth certain information regarding grants of plan-based awards to each of our named executive officers in 2017.2022.
COMMITTEE APPROVAL DATE | ESTIMATED POSSIBLE PAYOUTS UNDER NON-EQUITY INCENTIVE PLAN AWARDS(1) | ESTIMATED FUTURE PAYOUTS UNDER EQUITY INCENTIVE PLAN AWARDS(2) | ALL OTHER OPTION AWARDS: NUMBER OF SECURITIES UNDERLYING OPTIONS (#) (2) | EXERCISE OR BASE PRICE OF OPTION AWARDS ($/ 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 | 5/16/2022 | 5/16/2022 | 1,300,000 | 2,600,000 | 5,200,000 | – | – | – | – | – | – | ||||||||||||
Stock options(4) | 2/24/2022 | 2/23/2022 | – | – | – | – | – | – | 73,649 | 271.56 | 7,029,061 | |||||||||||||
Performance stock units(5) | 2/24/2022 | 2/23/2022 | – | – | – | 6,445 | 25,777 | 51,554 | – | – | 7,239,213 | |||||||||||||
Matthew R. McGrew | Annual cash incentive compensation | 5/16/2022 | 5/16/2022 | 549,038 | 1,098,075 | 2,196,150 | – | – | – | – | – | – | ||||||||||||
Stock options(4) | 2/24/2022 | 2/23/2022 | – | – | – | – | – | – | 22,358 | 271.56 | 2,133,848 | |||||||||||||
Performance stock units(5) | 2/24/2022 | 2/23/2022 | – | – | – | 1,957 | 7,826 | 15,652 | – | – | 2,197,854 | |||||||||||||
Jennifer L. Honeycutt | Annual cash incentive compensation | 5/16/2022 | 5/16/2022 | 501,563 | 1,003,125 | 2,006,250 | – | – | – | – | – | – | ||||||||||||
Stock options(4) | 2/24/2022 | 2/23/2022 | – | – | – | – | – | – | 17,097 | 271.56 | 1,631,738 | |||||||||||||
Performance stock units(5) | 2/24/2022 | 2/23/2022 | – | – | – | 1,496 | 5,984 | 11,968 | – | – | 1,680,547 | |||||||||||||
Joakim Weidemanis | Annual cash incentive compensation | 5/16/2022 | 5/16/2022 | 607,750 | 1,215,500 | 2,431,000 | – | – | – | – | – | – | ||||||||||||
Stock options(4) | 2/24/2022 | 2/23/2022 | – | – | – | – | – | – | 26,304 | 271.56 | 2,510,454 | |||||||||||||
Performance stock units(5) | 2/24/2022 | 2/23/2022 | – | – | – | 2,302 | 9,207 | 18,414 | – | – | 2,585,694 | |||||||||||||
Jose-Carlos Gutierrez-Ramos | Annual cash incentive compensation | 5/16/2022 | 5/16/2022 | 433,550 | 867,100 | 1,734,200 | – | – | – | – | – | – | ||||||||||||
Stock options(4) | 2/24/2022 | 2/23/2022 | – | – | – | – | – | – | 12,626 | 271.56 | 1,205,025 | |||||||||||||
Performance stock units(5) | 2/24/2022 | 2/23/2022 | – | – | – | 1,105 | 4,419 | 8,838 | – | – | 1,241,032 | |||||||||||||
Restricted Stock Units(6) | 2/24/2022 | 2/23/2022 | – | – | – | – | 2,210 | – | – | – | 594,888 |
(1) | ||
|
These columns relate to |
These columns relate to equity awards granted under the Omnibus Plan, the terms of which apply to all of the equity awards described in this table. | |
(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 |
57 |
Outstanding Equity Awards at
20172022 FiscalYear-End
The following table summarizes outstanding equity awards for each named executive officer as of December 31, 2017.2022. 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 | 2/24/2022 | – | 73,649(3) | 271.56 | 2/24/2032 | – | – | – | – | |||||||||
2/24/2021 | – | 82,440(4) | 223.00 | 2/24/2031 | – | – | – | – | ||||||||||
5/15/2020 | – | 17,710(4) | 163.85 | 5/15/2030 | – | – | – | – | ||||||||||
2/24/2020 | – | 47,510(4) | 156.82 | 2/24/2030 | – | – | – | – | ||||||||||
2/24/2019 | – | 66,080(4) | 113.48 | 2/24/2029 | – | – | – | – | ||||||||||
2/24/2018 | 23,165 | 23,165(4) | 99.33 | 2/24/2028 | – | – | – | – | ||||||||||
2/24/2017 | 53,310 | – | 86.08 | 2/24/2027 | – | – | – | – | ||||||||||
2/24/2016 | 35,067 | – | 65.95 | 2/24/2026 | – | – | – | – | ||||||||||
11/15/2015 | 15,792 | – | 70.75 | 11/15/2025 | – | – | – | – | ||||||||||
2/24/2022 | – | – | – | – | – | – | 25,777(5) | 6,867,508 | ||||||||||
2/24/2021 | – | – | – | – | – | – | 53,020(5) | 14,170,125 | ||||||||||
5/15/2020 | – | – | – | – | – | – | 12,750(5) | 3,414,450 | ||||||||||
2/24/2020 | – | – | – | – | – | – | 29,460(6) | 7,894,691 | ||||||||||
2/24/2018 | – | – | – | – | 3,823(7) | 1,014,701 | – | – | ||||||||||
Matthew R. McGrew | 2/24/2022 | – | 22,358(3) | 271.56 | 2/24/2032 | – | – | – | – | |||||||||
2/24/2021 | – | 24,730(4) | 223.00 | 2/24/2031 | – | – | – | – | ||||||||||
2/24/2020 | – | 33,650(4) | 156.82 | 2/24/2030 | – | – | – | – | ||||||||||
2/24/2019 | – | 38,180(4) | 113.48 | 2/24/2029 | – | – | – | – | ||||||||||
2/24/2018 | 24,712 | 6,178(8) | 99.33 | 2/24/2028 | – | – | – | – | ||||||||||
2/24/2017 | 13,860 | – | 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 | – | – | – | – | ||||||||||
2/24/2022 | – | – | – | – | – | – | 7,826(5) | 2,085,003 | ||||||||||
2/24/2021 | – | – | – | – | – | – | 15,910(5) | 4,252,107 | ||||||||||
2/24/2020 | – | – | – | – | – | – | 20,870(6) | 5,592,743 | ||||||||||
2/24/2018 | – | – | – | – | 2,039(9) | 541,191 | – | – |
58 |
Back to Contents |
|
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) | |||||||||
Jennifer L. Honeycutt | 2/24/2022 | – | 17,097(3) | 271.56 | 2/24/2032 | – | – | – | – | |||||||||
2/24/2021 | – | 3,300(10) | 223.00 | 2/24/2031 | – | �� | – | – | ||||||||||
2/24/2021 | – | 17,810(4) | 223.00 | 2/24/2031 | – | – | – | – | ||||||||||
7/15/2020 | – | 12,050(10) | 188.34 | 7/15/2030 | – | – | – | – | ||||||||||
2/24/2020 | – | 12,870(10) | 156.82 | 2/24/2030 | – | – | – | – | ||||||||||
5/15/2019 | 1,236 | 2,474(10) | 131.05 | 5/15/2029 | – | – | – | – | ||||||||||
2/24/2019 | 7,932 | 5,288(8) | 113.48 | 2/24/2029 | – | – | – | – | ||||||||||
2/24/2018 | 9,272 | 2,318(8) | 99.33 | 2/24/2028 | – | – | – | – | ||||||||||
2/24/2017 | 10,670 | – | 86.08 | 2/24/2027 | – | – | – | – | ||||||||||
11/15/2016 | 3,860 | – | 79.63 | 11/15/2026 | – | – | – | – | ||||||||||
2/24/2016 | 9,361 | – | 65.95 | 2/24/2026 | – | – | – | – | ||||||||||
2/24/2022 | – | – | – | – | – | – | 5,984(5) | 1,594,257 | ||||||||||
2/24/2021 | – | – | – | – | – | – | 13,590(5) | 4,482,662 | ||||||||||
7/15/2020 | – | – | – | – | – | – | 8,440(5) | 2,258,713 | ||||||||||
2/24/2020 | – | – | – | – | – | – | 7,980(6) | 2,138,480 | ||||||||||
5/15/2019 | – | – | – | – | 767(11) | 203,577 | – | – | ||||||||||
2/24/2019 | – | – | – | – | 1,640(9) | 435,289 | – | – | ||||||||||
2/24/2018 | – | – | – | – | 765(9) | 203,046 | – | – | ||||||||||
Joakim Weidemanis | 2/24/2022 | – | 26,304(3) | 271.56 | 2/24/2032 | – | – | – | – | |||||||||
2/24/2021 | – | 32,980(4) | 223.00 | 2/24/2031 | – | – | – | – | ||||||||||
5/15/2020 | – | 51,420(10) | 163.85 | 5/15/2030 | – | – | – | – | ||||||||||
2/24/2020 | – | 42,560(4) | 156.82 | 2/24/2030 | – | – | – | – | ||||||||||
2/24/2019 | – | 58,740(4) | 113.48 | 2/24/2029 | – | – | – | – | ||||||||||
2/24/2018 | 20,075 | 20,075(4) | 99.33 | 2/24/2028 | – | – | – | – | ||||||||||
2/24/2017 | 42,650 | – | 86.08 | 2/24/2027 | – | – | – | – | ||||||||||
11/15/2016 | 38,510 | – | 79.63 | 11/15/2026 | – | – | – | – | ||||||||||
2/24/2016 | 11,689 | – | 65.95 | 2/24/2026 | – | – | – | – | ||||||||||
2/24/2016 | 35,067 | – | 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 | 9,934 | – | 57.90 | 2/24/2024 | – | – | – | – | ||||||||||
2/24/2022 | – | – | – | – | – | – | 9,207(5) | 2,452,929 | ||||||||||
2/24/2021 | – | – | – | – | – | – | 21,210(5) | 5,668,585 | ||||||||||
2/24/2020 | – | – | – | – | – | – | 26,390(6) | 7,071,992 | ||||||||||
5/15/2020 | – | – | – | – | 18,515(11) | 4,914,251 | – | – | ||||||||||
2/24/2018 | – | – | – | – | 3,313(7) | 879,336 | – | – |
59 |
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) | |||||||||
Jose-Carlos Gutierrez-Ramos | 2/24/2022 | – | 12,626(3) | 271.56 | 2/24/2032 | – | – | – | – | |||||||||
2/24/2021 | – | 13,190(10) | 223.00 | 2/24/2031 | – | – | – | – | ||||||||||
2/24/2022 | – | – | – | 0 | – | – | 4,419(5) | 1,177,310 | ||||||||||
2/24/2021 | – | – | – | 0 | – | – | 8,490(5) | 2,269,037 | ||||||||||
2/24/2022 | – | – | – | 0 | 2,210(12) | 586,578 | – | – | ||||||||||
2/24/2021 | – | – | – | 0 | 1,697(12) | 450,418 | – | – |
|
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
|
|
| -
|
|
| -
|
|
(1) | 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, 2022. | ||
(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 third and fourth anniversaries of the grant date. | |
(4) | The option award was granted subject to time-based vesting conditions such that one-half of the award became or becomes exercisable on each of the fourth and fifth anniversaries of the grant date. |
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, | |
(8) | 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. |
(9) | 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. |
(10) | The option award was granted subject to time-based vesting conditions such that one-third of the award became or becomes exercisable on each of the third, fourth and fifth anniversaries of the grant date. |
(11) | The RSU award was granted subject to time-based vesting conditions such that one-third of the award vests or vested on each of the third, fourth and fifth anniversaries of the grant date. |
The RSU award was granted subject to time-based vesting conditions such that |
60 |
|
The following table summarizes stock option exercises and the vesting of stock awards with respect to our named executive officers in 2017.2022.
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) | ||||||||||||
Thomas P. Joyce, Jr. | 358,424 | $ | 22,285,301 | 56,321 | $ | 4,714,315 | ||||||||||
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 | |||||||||||
Angela S. Lalor | - | - | 31,541 | $ | 2,648,348 |
Option Awards | Stock Awards | |||||||
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 | 25,000 | 5,826,427 | 48,525 | 13,269,222 | ||||
Matthew R. McGrew | 18,935 | 4,118,960 | 26,496 | 7,248,297 | ||||
Jennifer L. Honeycutt | 8,211 | 1,635,385 | 2,566 | 688,255 | ||||
Joakim Weidemanis | 27,116 | 6,281,752 | 41,724 | 11,412,150 | ||||
Jose-Carlos Gutierrez-Ramos | – | – | 848 | 230,283 |
(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) |
Name | Number of PSU Shares That Vested(#) | Value Realized on Vesting($) | |||
Rainer M. Blair | 40,970 | 11,217,586 | |||
Matthew R. McGrew | 23,680 | 6,483,584 | |||
Jenifer L. Honeycutt | – | – | |||
Joakim Weidemanis | 36,420 | 9,971,796 | |||
Jose-Carlos Gutierrez-Ramos | – | – |
The following table describes the payments and benefits that each named executive officer 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, 2017.2022. 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, 2022 ($92.82265.42 per share). In addition to the amounts set forth below, upon any termination of employment each officer would also be entitled to:
• | receive all payments generally provided to salaried employees on a non-discriminatory basis upon termination, such as accrued salary, life insurance proceeds (for any termination caused by death), unused vacation and 401(k) Plan distributions; |
• | potentially receive an annual cash incentive compensation award pursuant to the Omnibus Plan, since under the terms of the award a participant who remains employed through the end of the annual performance period is eligible for an award under the plan; |
• | receive accrued, vested balances under the EDIP, ECP, DCP and the Cash Balance Plan, if applicable (provided that under the EDIP and the ECP, if the administrator determines that the circumstances of a participant’s termination constitute gross misconduct, the administrator may determine that the participant’s vesting percentage is as low as zero with respect to all balances that were contributed by Danaher); and |
• | exercise vested stock options (provided that under the terms of the Omnibus Plan, if an employee is terminated for gross misconduct, the administrator may terminate up to all of the participant’s unexercised or unvested equity awards). The terms of the EDIP, ECP, DCP and Omnibus Plan are described under “Summary of Employment Agreements and Plans.” |
61 |
Back to Contents |
|
Termination/Change-of-Control Event(1) | ||||||||
Named Executive Officer | Benefit | Termination Without Cause($) | Retirement($) | Death($)(2) | ||||
Rainer M. Blair | Accelerated or continued vesting of stock options(3) | – | 18,605,129 | 24,343,166 | ||||
Accelerated or continued vesting of RSUs/PSUs(3) | – | 28,621,468 | 19,369,260 | |||||
Benefits continuation(4) | 22,107 | – | – | |||||
Cash payments under Proprietary Interest Agreement/Senior Leader Severance Pay Plan(4) | 6,500,000 | – | – | |||||
TOTAL: | 6,522,107 | 47,226,597 | 43,712,426 | |||||
Matthew R. McGrew | Accelerated or continued vesting of stock options | – | – | 11,530,610 | ||||
Accelerated or continued vesting of RSUs/PSUs | – | – | 8,256,328 | |||||
Benefits continuation(4) | 23,872 | – | – | |||||
Cash payments under Proprietary Interest Agreement/Senior Leader Severance Pay Plan(4) | 878,460 | – | – | |||||
Value of unvested EDIP balance that would be accelerated(5) | – | – | 668,950 | |||||
TOTAL: | 902,332 | – | 20,455,888 | |||||
Jennifer L. Honeycutt | Accelerated or continued vesting of stock options | – | – | 4,742,869 | ||||
Accelerated or continued vesting of RSUs/PSUs | – | – | 6,925,936 | |||||
Benefits continuation(4) | 22,267 | – | – | |||||
Cash payments under Senior Leader Severance Pay Plan(4) | 802,500 | – | – | |||||
TOTAL: | 824,767 | – | 11,668,805 | |||||
Joakim Weidemanis | Accelerated or continued vesting of stock options | – | – | 23,502,969 | ||||
Accelerated or continued vesting of RSUs/PSUs | – | – | 14,521,160 | |||||
Benefits continuation(4) | 27,723 | – | – | |||||
Cash payments under Senior Leader Severance Pay Plan(4) | 972,400 | – | – | |||||
Value of unvested EDIP balance that would be accelerated(5) | – | – | 653,515 | |||||
TOTAL: | 1,000,123 | – | 38,677,644 | |||||
Jose-Carlos Gutierrez-Ramos | Accelerated or continued vesting of stock options | – | – | 559,520 | ||||
Accelerated or continued vesting of RSUs/PSUs | – | – | 1,887,876 | |||||
Benefits continuation(4) | 28,365 | – | – | |||||
Cash payments under Senior Leader Severance Pay Plan(4) | 754,000 | – | – | |||||
Value of unvested ECP balance that would be accelerated(5) | – | – | 46,048 | |||||
TOTAL: | 782,365 | – | 2,493,444 |
NAMED EXECUTIVE OFFICER | BENEFIT | TERMINATION/CHANGE-OF-CONTROL EVENT (1) | ||||||||||||
TERMINATION WITHOUT CAUSE | RETIREMENT | DEATH (2) | ||||||||||||
Thomas P. Joyce, Jr. | Value of unvested stock options that would be accelerated (3)(4) | $ | 10,655,379 | $ | 5,505,361 | $ | 18,863,716 | |||||||
Value of unvested RSUs and PSUs that would be accelerated (3)(4) | $ | 15,508,047 | $ | 10,005,306 | $ | 11,202,427 | ||||||||
Benefits continuation (5) | $ | 16,146 | - | - | ||||||||||
Cash payments under Proprietary Interest Agreement/Senior Leader Severance Pay Plan (4) | $ | 6,533,334 | - | - | ||||||||||
Total: | $ | 32,712,906 | $ | 15,510,667 | $ | 30,066,143 | ||||||||
Daniel L. Comas | Value of unvested stock options that would be accelerated | - | - | $ | 12,991,997 | |||||||||
Value of unvested RSUs and PSUs that would be accelerated | - | - | $ | 8,703,727 | ||||||||||
Benefits continuation (5) | $ | 16,254 | - | - | ||||||||||
Cash payments under Proprietary Interest Agreement/Senior Leader Severance Pay Plan (6) | $ | 905,476 | - | - | ||||||||||
Total: | $ | 921,730 | - | $ | 21,695,724 | |||||||||
Rainer M. Blair | Value of unvested stock options that would be accelerated | - | - | $ | 3,173,323 | |||||||||
Value of unvested RSUs and PSUs that would be accelerated | - | - | $ | 3,440,997 | ||||||||||
Benefits continuation (5) | $ | 16,254 | - | - | ||||||||||
Cash payments under Senior Leader Severance Pay Plan (6) | $ | 625,000 | - | - | ||||||||||
Value of unvested EDIP balance that would be accelerated (7) | - | - | $ | 378,500 | ||||||||||
Total: | $ | 641,254 | - | $ | 6,992,820 | |||||||||
William K. Daniel II | Value of unvested stock options that would be accelerated | - | - | $ | 10,871,121 | |||||||||
Value of unvested RSUs and PSUs that would be accelerated | - | - | $ | 7,227,216 | ||||||||||
Benefits continuation (5) | $ | 16,146 | - | - | ||||||||||
Cash payments under Proprietary Interest Agreement/Senior Leader Severance Pay Plan (6) | $ | 773,953 | - | - | ||||||||||
Value of unvested EDIP balance that would be accelerated (7) | - | - | $ | 600,528 | ||||||||||
Total: | $ | 790,099 | - | $ | 18,698,865 | |||||||||
Angela S. Lalor | Value of unvested stock options that would be accelerated | - | - | $ | 4,890,124 | |||||||||
Value of unvested RSUs and PSUs that would be accelerated | - | - | $ | 3,148,445 | ||||||||||
Benefits continuation (5) | $ | 16,146 | - | - | ||||||||||
Cash payments under Senior Leader Severance Pay Plan (6) | $ | 1,363,498 | - | - | ||||||||||
Value of unvested EDIP balance that would be accelerated (7) | - | - | $ | 564,315 | ||||||||||
Total: | $ | 1,379,644 | - | $ | 8,602,884 |
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, and(b) actual performance in the case of death followingat the conclusion of the relevant performance period, and (c) in the case of retirement, termination without cause orchange-of-control, if applicable, based on assuming actual performance for 2015the 2020 PSUs, maximum-level performance for the 2021 PSUs, and assuming target-level performance for 2016 and 2017the 2022 PSUs) that would vest or would have vested as a result of the specified event of termination orchange-of-control occurring as of December 31, 2017.2022. The level of PSU performance assumed for purposes of this table is consistent with the methodology applied for purposes of the “Outstanding Equity Awards at 2022 Fiscal Year-End” table. With respect to PSUs, the values reflected in the table above and the footnotes below also include the amount of cash dividend equivalent rights attached to the respective PSUs and accrued as of December 31, 2022.
2023 PROXY STATEMENT | 62 |
(1) | For a description of the treatment upon achange-of-control of outstanding equity awards granted under the Omnibus Plan, please see “Summary of Employment Agreements and Plans.” The tabular disclosure assumes that upon achange-of-control of Danaher (as defined in the Omnibus Plan), Danaher’s Board does not accelerate the vesting of any unvested RSUs, PSUs or stock options held by the named executive officers. If achange-of-control had occurred as of December 31, |
Dr. Gutierrez-Ramos, $4,483,344. | ||
|
The terms of the Omnibus Plan provide for accelerated vesting of a participant’s stock options and a pro rata portion of a participant’s RSUs and PSUs (at target value) if the participant dies during employment. For a description of these provisions under the Omnibus Plan, please see “Summary of Employment Agreements and Plans.” |
(3) | If Mr. |
(4) |
Please see “Summary of Employment Agreements and Plans” for a description of the respective benefits |
Under the terms of the EDIP and ECP, upon a participant’s death the unvested portion of the Company contributions that have been credited to the participant’s |
2017
2023 PROXY STATEMENT | 63 |
The table below sets forth for each named executive officer information regarding (1) participation in the EDIP.EDIP and the ECP, as applicable, (2) participation in the DCP (if any) and (3) PSUs that vested in 2022 and remain subject to a mandatory holding period that extends until the end of 2023. There were no withdrawals by or distributions to any of the named executive officers from the EDIP, ECP or DCP in 2017.2022. For a description of the EDIP, ECP and DCP, please see “Summary of Employment Agreements and Plans – Supplemental Retirement Program”; for a description of the PSUs, please see “Compensation Discussion and Analysis – Analysis of 2022 Named Executive DeferredOfficer Compensation – Long-Term Incentive Program.Awards.”
NAME | PLAN NAME | EXECUTIVE CONTRIBUTIONS IN LAST FY ($)(1) | REGISTRANT CONTRIBUTIONS IN LAST FY ($)(2) | AGGREGATE EARNINGS IN LAST FY ($)(3) | AGGREGATE BALANCE AT LAST FYE ($)(4) | |||||||||||||||
Thomas P. Joyce, Jr. | EDIP | $ | 1,174,038 | $ | 330,000 | $ | 1,806,424 | $ | 13,549,358 | |||||||||||
Daniel L. Comas | EDIP | 0 | $ | 194,030 | $ | 635,978 | $ | 3,951,138 | ||||||||||||
Rainer M. Blair | EDIP | 0 | $ | 59,305 | $ | 85,012 | $ | 510,257 | ||||||||||||
William K. Daniel II | EDIP | $ | 115,840 | $ | 131,426 | $ | 474,728 | $ | 2,876,819 | |||||||||||
Angela S. Lalor | EDIP | $ | 506,926 | $ | 76,102 | $ | 327,442 | $ | 2,253,016 |
Name | Plan Name | Executive Contributions In Last FY($)(1) | Registrant Contributions In Last FY($)(2) | Aggregate Earnings In Last FY($)(3) | Aggregate Balance At Last FYE($)(4) | |||||
Rainer M. Blair | EDIP | – | 288,000 | (640,074) | 2,721,349 | |||||
Vested PSUs(5) | – | 11,217,586 | (210,586) | 11,007,000 | ||||||
Matthew R. McGrew | EDIP | – | 107,811 | (224,784) | 955,643 | |||||
Vested PSUs(5) | – | 6,483,584 | (121,715) | 6,361,869 | ||||||
Jennifer L. Honeycutt | EDIP | – | 168,750 | (879,578) | 3,753,779 | |||||
DCP | 832,869 | – | (121,307) | 1,100,356 | ||||||
Joakim Weidemanis | EDIP | – | 168,480 | (990,955) | 4,583,708 | |||||
DCP | – | – | (138,872) | 816,350 | ||||||
Vested PSUs(5) | – | 9,971,796 | (187,199) | 9,784,597 | ||||||
Jose-Carlos Gutierrez-Ramos | ECP | – | 49,300 | (3,252) | 46,048 | |||||
DCP | 411,510 | – | (41,832) | 369,678 |
(1) | Consists of contributions to the |
NAME | 2017 SALARY (REPORTED IN SUMMARY COMPENSATION TABLE FOR 2017) | NON-EQUITY INCENTIVE PLAN COMPENSATION EARNED WITH RESPECT TO 2016 BUT DEFERRED IN 2017 (REPORTED IN SUMMARY COMPENSATION TABLE FOR 2016) | ||||||
Thomas P. Joyce, Jr. | $ | 299,038 | $ | 875,000 | ||||
Daniel L. Comas | - | - | ||||||
Rainer M. Blair | - | - | ||||||
William K. Daniel II | $ | 115,840 | - | |||||
Angela S. Lalor | - | $ | 506,926 |
Name | 2022 Salary (Reported in Summary Compensation Table for 2022)($) | Non-Equity Incentive Plan Compensation Earned With Respect to 2021 but Deferred in 2022 (Reported in Summary Compensation Table for 2021)($) | |||
Rainer M. Blair | – | – | |||
Matthew R. McGrew | – | – | |||
Jennifer L. Honeycutt | 64,119 | 768,750 | |||
Joakim Weidemanis | – | – | |||
Jose-Carlos Gutierrez-Ramos | – | N/A |
2023 PROXY STATEMENT | 64 |
(2) | The EDIP or ECP amounts set forth in this column (as applicable) are included as |
The PSU amounts set forth in this column (including related cash dividend equivalent rights) are included in the “Stock Awards-Value Realized on Vesting” column in the “Option Exercises and Stock Vested During Fiscal 2022” table. | ||
(3) | ||
|
None of the amounts set forth in this column are included as compensation in the |
EDIP INVESTMENT OPTION | RATE OF RETURN FROM JANUARY 1, 2017 THROUGH DECEMBER 31, 2017 (%) | EDIP INVESTMENT OPTION | RATE OF RETURN FROM JANUARY 1, 2017 THROUGH DECEMBER 31, 2017 (%) | |||||||
Fidelity Institutional Money Market Fund | 0.79 | % | FidelityLow-Priced Stock Commingled Pool | 20.93 | % | |||||
LifePath Index 2020Non-Lendable Fund G | 11.67 | % | T. Rowe Price Large Cap Core Growth | 36.88 | % | |||||
LifePath Index 2025Non-Lendable Fund G | 13.82 | % | Vanguard Total International Stock Index Fund | 27.55 | % | |||||
LifePath Index 2030Non-Lendable Fund G | 15.75 | % | Fidelity Strategic Real Return Fund | 4.08 | % | |||||
LifePath Index 2035Non-Lendable Fund G | 17.62 | % | Fidelity Equity Income Fund – Class K | 13.47 | % | |||||
LifePath Index 2040Non-Lendable Fund G | 19.31 | % | Dodge & Cox International Stock Fund | 23.94 | % | |||||
LifePath Index 2045Non-Lendable Fund G | 20.38 | % | Fidelity Managed Income Portfolio II – Class 3 | 1.76 | % | |||||
LifePath Index 2050Non-Lendable Fund G | 20.77 | % | Vanguard Total Bond Market Index | 3.57 | % | |||||
LifePath Index 2055Non-Lendable Fund G | 20.76 | % | Fidelity 500 Index Fund – Institutional Premium Class | 21.81 | % | |||||
LifePath Index 2060Non-Lendable Fund G | 20.72 | % | Bond Fund | 4.51 | % | |||||
LifePath Index RetirementNon-Lendable Fund G | 10.05 | % | Fidelity Extended Market Index Fund – Premium Class | 18.18 | % | |||||
Danaher Stock Fund | 19.83 | % | Active Small Cap Equity Fund | 15.48 | % | |||||
Cohen & Steers Realty Shares Fund | 7.09 | % | PIMCO All Asset Fund Institutional Class | 13.98 | % |
Investment Option | Rate of Return from January 1, 2022 Through December 31, 2022 (%) | Investment Option | Rate of Return from January 1, 2022 Through December 31, 2022 (%) | |||
Active International Equity Fund | -9.06% | BlackRock LifePath® Index 2065 Fund | -18.29% | |||
BlackRock LifePath® Index 2025 Fund | -15.30% | T. Rowe Price Large Cap Core Growth Separate Account | -38.10% | |||
BlackRock LifePath® Index 2030 Fund | -16.03% | Small/Mid Cap Equity Index Fund | -18.47% | |||
BlackRock LifePath® Index 2035 Fund | -16.71% | Large Cap Equity Index Fund | -18.18% | |||
BlackRock LifePath® Index 2040 Fund | -17.36% | Managed Income Portfolio II Class 3 | 1.45% | |||
BlackRock LifePath® Index 2045 Fund | -17.95% | The London Company Income Equity Separate Account | -11.40% | |||
BlackRock LifePath® Index 2050 Fund | -18.25% | International Equity Index Fund | -16.28% | |||
BlackRock LifePath® Index 2055 Fund | -18.28% | Bond Fund | -13.41% | |||
BlackRock LifePath® Index 2060 Fund | -18.28% | Bond Index Fund | -13.02% | |||
BlackRock LifePath® Index Retirement Fund | -14.69% | Active Small Cap Equity Fund | -15.62% | |||
The Danaher Corporation Stock Fund | -19.03% | Diversified Real Return Fund | -8.36% | |||
Cohen & Steers Realty Shares Fund | -24.96% |
(4) | Of these balances, the following amounts were reported in the Summary Compensation Table for previous years: Mr. |
(5) | Represents PSUs that vested in February 2022 but remain subject to a mandatory holding period that extends until the end of 2023. The dollar value reported under “Registrant Contributions in Last FY” is based on (a) the number of PSU shares vested times the closing price of Danaher’s Common Stock as reported on the NYSE on the vesting date (or on the last trading day prior to the vesting date if the vesting date was not a trading day), plus (b) the amount of cash dividend equivalent rights attached to the respective PSUs and accrued as of the vesting date. The dollar value reported under “Aggregate Balance at Last FYE” is based on (x) the number of PSU shares vested times the closing price of Danaher’s Common Stock as reported on the NYSE on December 31, 2022, plus (y) the amount of cash dividend equivalent rights attached to the respective PSUs and accrued as of December 31, 2022. The dollar value reported under “Aggregate Earnings in Last FY” is equal to the difference between the award value as of December 31, 2022 and the award value as of respective vesting date. |
2017
The table below shows as of December 31, 2017,2022, the present value of accumulated benefits payable to the named executive officers, as applicable,Ms. Honeycutt under the Cash Balance Plan of the Danaher Corporation & Subsidiaries Pension Plan (the “Cash Balance Plan”), which is the only defined benefit pension plan in which any of the named executive officers participates. The Cash Balance Plan is part of the Danaher Corporation & Subsidiaries Pension Plan, a funded pension plan qualified under Section 401(a) of the Code.Internal Revenue Code (the “Code”). Prior to the inception of the Cash Balance Plan in 1997, Danaher made annual contributions to the defined contribution retirement plans of substantially all of its United States salaried employees, in an amount equal to 3% of the employee’s annual, eligible base salary. From 1997 through 2003, in lieu of these contributions, Danaher credited the same level of contributions to the Cash Balance Plan for each covered employee. As of December 31, 2003, the plan was frozen with respect to substantially all participants under the plan (including Messrs. Joyce and Comas)Ms. Honeycutt) and no further contributions will be made with respect to such participants under the plan. All accrued benefits under the plan for these participants became 100% vested as of such date. All account balances under the plan with respect to these participants (including Messrs. Joyce and Comas)Ms. Honeycutt) now increase each year at a rate equal to the annual rate of interest on30-year Treasury securities for the month of November immediately preceding the applicable plan year. Upon termination of employment, a participant receives his or hertheir vested accrued benefit in cash or as an annuity (based on the participant’s election).
2023 PROXY STATEMENT | 65 |
The material assumptions used in quantifying the present value of the accumulated benefit at December 31, 20172022 are as follows: an interest crediting rate (applied from the plan measurement date until normal retirement age) of 3.65%3.50%; a retirement age of 65, which is normal retirement age under the Cash Balance Plan; payment of the accrued obligations in a lump sum upon retirement; and the discount rates as set forth in Note 1016 to Danaher’s consolidated financial statements included in Danaher’s Annual Report onForm 10-K for the year ended December 31, 2017.2022. There were no payments made to any named executive officers under the Cash Balance Plan in 2017.2022.
NAME | PLAN NAME | NUMBER OF YEARS CREDITED SERVICE (#)(1) | PRESENT VALUE OF ACCUMULATED | |||||||
Thomas P. Joyce, Jr. | Cash Balance Plan of the Danaher Corporation & Subsidiaries Pension Plan | 7.0 | $ | 129,736 | ||||||
Daniel L. Comas | Cash Balance Plan of the Danaher Corporation & Subsidiaries Pension Plan | 7.0 | $ | 84,262 | ||||||
Rainer M. Blair | - | - | - | |||||||
William K. Daniel II | - | - | - | |||||||
Angela S. Lalor | - | - | - |
Name | Plan Name | Number of Years Credited Service(#)(1) | Present Value of Accumulated Benefits($)(2) | |||
Rainer M. Blair | – | – | – | |||
Matthew R. McGrew | – | – | – | |||
Jennifer L. Honeycutt | Cash Balance Plan of Danaher Corporation & Subsidiaries Pension Plan | 7.0 | 20,133 | |||
Joakim Weidemanis | – | – | – | |||
Jose-Carlos Gutierrez-Ramos | – | – | – |
(1) | ||
|
Represents the number of years the named executive officer participated in the Cash Balance Plan before it was frozen in 2003 with respect to new Danaher contributions. |
(2) | Calculated as of December 31, |
All data set forth in the table below is as of December 31, 2017.2022.
PLAN CATEGORY (1)
| NUMBER OF SECURITIES
| WEIGHTED-AVERAGE
|
NUMBER OF SECURITIES COLUMN (a))
| |||||||||
(a)
| (b) (2)
| (c)
| ||||||||||
Equity compensation plans approved by security holders(3) | 23,868,257 | (4) | $ | 59.95 | 71,572,707 | (5) | ||||||
Equity compensation plans not approved by security holders | 0 | - | 0 | |||||||||
Total | 23,868,257 | $ | 59.95 | 71,572,707 |
Plan Category(1) | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights(a) | Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights(b)(2) | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column(a))(c) | |||
Equity compensation plans approved by security holders(3) | 19,806,468(4) | $149.12 | 47,361,071(5) | |||
Equity compensation plans not approved by security holders(6) | 78,450 | – | 1,911,248 | |||
TOTAL | 19,884,918 | $149.12 | 49,272,319 |
(1) | Table does not include (a) |
(2) | The PSUs and RSUs that have been issued under our equity compensation plans (and under the Pall |
(3) | Consists of the Omnibus Plan (including theNon-Employee Directors’ Deferred Compensation |
(4) | Consists of |
(5) | Consists of |
(6) | Consists of the DCP; for a summary of the DCP, please see “Summary of Employment Agreements and Plans – Supplemental Retirement Program.” Under the terms of the DCP, any portion of a participant’s account that is subject to the Danaher Common Stock earnings rate must be distributed in shares of Danaher Common Stock (all other balances are distributed in cash). |
2023 PROXY STATEMENT | 66 |
The disclosure in this section 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 Exchange Act of 1934, except to the extent Danaher specifically incorporates it by reference therein.
Provided below is the Company’s “pay versus performance” disclosure as required pursuant to Item 402(v) of Regulation S-K promulgated under the Exchange Act. As required by Item 402(v), we have included:
• | A list of the most important measures that our Compensation Committee used in 2022 to link a measure of pay calculated in accordance with Item 402(v) (referred to as “compensation actually paid”, or “CAP”) to Company performance; |
• | A table that compares the total compensation of our named executive officers’ (also known as NEOs) as presented in the Summary Compensation Table (“SCT”) to CAP and that compares CAP to specified performance measures; and |
• | Graphs that describe: |
• | the relationships between CAP and our cumulative total shareholder return (“TSR”), GAAP Net Income, and our Company selected measure, non-GAAP adjusted diluted net earnings per common share from continuing operations (“Adjusted EPS”); and | |
• | the relationship between our TSR and the TSR of the S&P 500 Health Care Index (“Peer Group TSR”). |
Salary, Bonus, Non-Equity Incentive Plan Compensation, Nonqualified Deferred Compensation Earnings and All Other Compensation are each calculated in the same manner for purposes of both CAP and SCT. There are two primary differences between the calculation of CAP and SCT total compensation:
SCT Total | CAP | |||
Pension | Year over year change in the actuarial present value of pension benefits | Current year service cost and any prior year service cost (if a plan amendment occurred during the year) | ||
Stock and Option Awards | Grant date fair value of stock and option awards granted during the year | Year over year change in the fair value of stock and option awards that are unvested as of the end of the year, or vested or were forfeited during the year(1) |
(1) | Includes any dividends paid on equity awards in the fiscal year prior to the vesting date that are not otherwise reflected in the fair value of such award. |
This disclosure has been prepared in accordance with Item 402(v) and does not necessarily reflect value actually realized by the executives or how our Committee evaluates compensation decisions in light of Company or individual performance. In particular, our Committee has not used CAP as a basis for making executive compensation decisions, nor does it use GAAP Net Income or Peer Group TSR for purposes of determining executive incentive compensation. Please refer to our Compensation Discussion and Analysis on pages 40 to 54 for a discussion of our executive compensation program objectives and the ways in which we align executive compensation with performance.
Our Most Important Metrics Used for Linking Pay and Performance. As required by Item 402(v), below are the most important metrics our Committee used to link executive pay to performance for 2022. Our stock price performance, as reflected by our absolute TSR, directly impacts the value of the equity compensation awards we grant to executive officers. Each of the other metrics below are used for purposes of determining payouts under either our executive annual cash incentive compensation program or our executive PSU program.
• | Absolute TSR |
• | Relative TSR compared to S&P 500 TSR |
• | Adjusted EPS (non-GAAP) |
• | Adjusted Free Cash Flow to Adjusted Net Income Ratio (non-GAAP) |
• | Core Revenue Growth (non-GAAP) |
Adjusted EPS is the most heavily weighted metric used to determine Company performance under our executive annual cash incentive compensation program. The Committee weights Adjusted EPS most heavily in the Company performance 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. Accordingly, Adjusted EPS is the Company-selected measure included in the table and graphs that follow.
2023 PROXY STATEMENT | 67 |
Pay Versus PerformanceTable. In accordance with Item 402(v), we provide below the tabular disclosure for the Company’s President and Chief Executive Officer (“CEO”) (our Principal Executive Officer) and the average of our NEOs other than the CEO for 2022, 2021 and 2020.
Value of Initial Fixed $100 Investment Based On: | ||||||||||||||||||||
Fiscal Year(1) (a) | Summary Compensation Table Total for First PEO (b1) | Compensation Actually Paid to First PEO(2) (c1) | Summary Compensation Table Total for Second PEO (b2) | Compensation Actually Paid to Second PEO(2) (c2) | Average Summary Compensation Table Total for Non-PEO NEOs (d) | Average Compensation Actually Paid to Non-PEO NEOs(2) (e) | Total Share- holder Return(3) (f) | Peer Group Total Share- holder Return(3) (g) | Net Income(4) (h) | Adjusted EPS(5) (i) | ||||||||||
2022 | $20,196,027 | $190,304 | $0 | $0 | $6,641,306 | $(930,613) | $175 | $140 | $7,209 | $10.97 | ||||||||||
2021 | $17,152,267 | $59,455,992 | $0 | $0 | $6,225,036 | $26,481,836 | $216 | $143 | $6,433 | $10.00 | ||||||||||
2020 | $10,396,761 | $32,944,487 | $16,763,956 | $83,394,550 | $6,786,580 | $20,676,667 | $145 | $113 | $3,646 | $5.11 |
(1) | For 2020, 2021 and 2022, the First PEO is Rainer Blair. In 2020, the Second PEO is Thomas Joyce. The other NEOs in 2020 were Joakim Weidemanis, Angela Lalor, Matthew McGrew and Brian Ellis; in 2021, the other NEOs were Messrs. Weidemanis and McGrew and Mss. Lalor and Jennifer Honeycutt; and in 2022, the other NEOs were Messrs. Weidemanis and McGrew, Dr. Jose-Carlos Gutierrez-Ramos and Ms. Honeycutt. |
(2) | To calculate CAP (columns (c1), (c2), and (e)), the following amounts were deducted from and added to the applicable SCT total compensation: |
PEO 1 | ||||||||
Prior FYE Current FYE Fiscal Year | 12/31/2019 12/31/2020 2020 | 12/31/2020 12/31/2021 2021 | 12/31/2021 12/31/2022 2022 | |||||
SCT Total | $10,396,761 | $17,152,267 | $20,196,027 | |||||
— | Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year | $(6,585,590) | $(11,384,877) | $(14,268,274) | ||||
+ | Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year | $12,507,143 | $22,940,973 | $14,744,612 | ||||
+ | Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Year | $15,738,917 | $30,678,296 | $(14,993,297) | ||||
+ | Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year | $0 | $0 | $0 | ||||
+ | Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years For Which Applicable Vesting Conditions Were Satisfied During Fiscal Year | $887,256 | $69,332 | $(5,488,764) | ||||
— | Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year | $0 | $0 | $0 | ||||
COMPENSATION ACTUALLY PAID | $32,944,487 | $59,455,992 | $190,304 | |||||
PEO 2 | ||||||||
Prior FYE Current FYE Fiscal Year | 12/31/2019 12/31/2020 2020 | 12/31/2020 12/31/2021 2021 | 12/31/2021 12/31/2022 2022 | |||||
SCT Total | $16,763,956 | $0 | $0 | |||||
— | Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year | $(11,748,524) | $0 | $0 | ||||
+ | Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year | $24,040,706 | $0 | $0 | ||||
+ | Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Year | $53,508,940 | $0 | $0 | ||||
+ | Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year | $0 | $0 | $0 | ||||
+ | Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years For Which Applicable Vesting Conditions Were Satisfied During Fiscal Year | $829,471 | $0 | $0 | ||||
— | Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year | $0 | $0 | $0 | ||||
COMPENSATION ACTUALLY PAID | $83,394,550 | $0 | $0 |
2023 PROXY STATEMENT | 68 |
Non-PEO NEOs | ||||||||
Prior FYE Current FYE Fiscal Year | 12/31/2019 12/31/2020 2020 | 12/31/2020 12/31/2021 2021 | 12/31/2021 12/31/2022 2022 | |||||
SCT Total | $6,786,580 | $6,225,036 | $6,641,306 | |||||
— | Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year | $(4,178,109) | $(3,370,721) | $(3,945,270) | ||||
+ | Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year | $7,853,538 | $6,792,180 | $4,069,305 | ||||
+ | Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Year | $9,403,554 | $16,443,088 | $(5,970,277) | ||||
+ | Fair Value at Vesting of Option Awards and Stock Awards Granted in Fiscal Year That Vested During Fiscal Year | $0 | $0 | $0 | ||||
+ | Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years For Which Applicable Vesting Conditions Were Satisfied During Fiscal Year | $811,104 | $392,253 | $(1,725,677) | ||||
— | Fair Value as of Prior Fiscal Year-End of Option Awards and Stock Awards Granted in Prior Fiscal Years That Failed to Meet Applicable Vesting Conditions During Fiscal Year | $0 | $0 | $0 | ||||
COMPENSATION ACTUALLY PAID | $20,676,667 | $26,481,836 | $(930,613) |
The fair value of performance stock units (PSUs) used in the calculation of CAP (columns (c1), (c2), and (e)) was determined using a Monte Carlo simulation valuation model, in accordance with ASC 718. The fair value of option awards used in the calculation of CAP was determined using the Black-Scholes option pricing model, in accordance with ASC 718. In both cases, the assumptions used in these calculations are not materially different than those used for purposes of the Summary Compensation Table. | |
(3) | Reflects TSR indexed to $100 for each of the Company and the S&P 500 Health Care Index, which is an industry line peer group reported in the performance graph included in the Company’s 2022 Annual Report on Form 10-K. |
(4) | Values shown are in millions. |
(5) | Please see page 43 for a definition of Adjusted EPS. Values shown reflect Adjusted EPS as calculated for purposes of our executive compensation program for the applicable reporting year. |
2023 PROXY STATEMENT | 69 |
2023 PROXY STATEMENT | 70 |
Relationship between CAP and GAAP Net Income. The chart below reflects the relationship between the PEO and Average NEO CAP and our GAAP Net Income.
Relationship between CAP and Adjusted EPS (our Company-Selected Measure). The chart below reflects the relationship between the PEO CAP and Average NEO CAP and our Adjusted EPS.
2023 PROXY STATEMENT | 71 |
Provided below is information about the relationship of the annual total compensation of Thomas P. Joyce, Jr.,Rainer M. Blair, our President and Chief Executive Officer, and the annual total compensation of the median of our employees other than Mr. Joyce.Blair. 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 2017,2022, our last completed fiscal year:
• | the annual total compensation of Mr. Blair, as reported in the Summary Compensation Table presented elsewhere in this Proxy Statement, was $20,196,027; |
• | the annual total compensation of the median of all Danaher employees (other than Mr. Blair) was $64,979; and |
• | the ratio of the annual total compensation of Mr. Blair to the annual total compensation of the median of all other Company employees was 311 to 1. |
For purposes of the median of all Danaher employees (other than Mr. Joyce) was $67,756; and
In estimating the2022 CEO pay ratio set forth above, we used the following methodology and material assumptions, adjustments and estimates:
72 |
SUMMARY OF EMPLOYMENT AGREEMENTS AND PLANS
Following is a description of (1) named executive officer employment-related agreements, and (2) the cash incentive compensation, equity compensation,non-qualified deferred compensation and severance pay plans in which Danaher’s named executive officers participate. Each of these plans allows the plan administrator to exercise certain discretion in the administration of the plan, and as a result the plan administrator may administer the plan in a different manner from period to period, or in a different manner with respect to different plan participants, in each case to the extent permitted under the applicable plan.
Named Executive Officer Proprietary Interest Agreements
In connection with Mr. Blair’s promotion to the role of President and CEO in 2020, Danaher and Mr. Blair entered into an Amended and Restated Agreement Regarding Competition and Protection of Proprietary Interests (the “Blair Agreement”). Under the Blair Agreement, during and for two years after Mr. Blair’s employment with us, subject to certain customary exceptions, he is prohibited from disclosing or improperly using any of our confidential information; making any disparaging comments about us; competing with us; selling to or soliciting purchases from our customers and prospective customers with respect to products and services about which he has particular knowledge; or hiring or soliciting any of our current or recent employees, and during and for one year after his employment with us he is prohibited from working for any Danaher customers or vendors in any role in which he would use or disclose or threaten to use or disclose any of our confidential information. In addition, with limited exceptions all intellectual property that Mr. Blair develops in connection with his employment with us belongs to us. The Blair Agreement further provides that if we terminate Mr. Blair’s employment without “cause” or if he terminates his employment for “good reason” (each as defined in the Blair Agreement), he will be entitled to (1) a cash amount equal to twelve months of base salary at the rate in effect on the date of termination (the “Termination Date,” and the year in which the Termination Date occurs is referred to as the “Termination Year”), (2) the annual cash incentive compensation award for service in the calendar year prior to the Termination Year, if it has not been paid prior to the Termination Date (the “Accrued Obligation”), (3) a cash amount equal to his target annual cash incentive compensation award for the Termination Year, and (4) a cash amount equal to the product of (x) his target annual cash incentive compensation award for the Termination Year, times (y) a fraction, the numerator of which is the number of calendar days from the beginning of the Termination Year through the Termination Date, and the denominator of which is 365; provided in each case he signs and does not revoke a release of all claims. Any cash severance payments paid under any other Danaher plan or agreement will diminish the severance payments under the Blair Agreement on a dollar-for-dollar basis (except for the Accrued Obligation).
We have also entered into an agreement with each of Messrs. Joyce, Comas, Blair and Daniel and Ms. Lalorthe other NEOs under which each such officer is subject to certain covenants designed to protect Danaher’s proprietary interests (each, a “Proprietary Interest Agreement”). Except as set forth below,for differences in the duration of certain restrictive covenants, the terms of thesuch agreements to which each such named executive officer is a party are substantially the same. During and for specified periods after the officer’s employment with us, subject to certain customary exceptions, the officer is prohibited from disclosing or improperly using any of our confidential information; making any disparaging comments about us; competing with us; selling to or soliciting purchases from our customers and prospective customers with respect to products and services about which the officer has particular knowledgeknowledge; or expertise; hiring or soliciting any of our current or recent employees, or otherwise assisting or encouraging any of our employees to leave us; interfering with our vendor relationships; or developing competing products or services.employees. Each officer also agrees that with limited exceptions all intellectual property that the officer develops in connection with the officer’s employment with us belongs to us,us. Certain of the agreements also restrict interfering with our vendor relationships, and assigns us all rightscertain of the agreements prohibit the officer may havefor a specified period of time from working for any Danaher customers or vendors in any such intellectual property.
Under the Proprietary Interest Agreements (except for Ms. Lalor’s and Mr. Blair’s agreements,role in which provide for no cash consideration), if we terminate the officer’s employment without cause the officer is entitledwould use or disclose or threaten to an amount equal to nine monthsuse or disclose any of base salary, plus severance pay equal to three months’ salary if the officer signs our standard form of release at the time of termination. These amounts would be paid out over twelve months according to the normal payroll cycle. Under the agreement, “cause” is generally defined as the officer’s (a) dishonesty, fraud or other willful misconduct or gross negligence; (b) conviction of or pleading guilty or no contest to a felony, misdemeanor (other than a traffic violation) or other crime that would impair his ability to perform his duties or Danaher’s reputation; (c) refusal or willful failure to satisfactorily perform his duties or comply with our standards, policies or procedures; (d) material breach of the agreement; (e) death; or (f) termination because of illness that results in the officer’s absence from work on a full-time basis for twelve consecutive months.confidential information.
In connection with Mr. Joyce’s promotion to President and CEO in September 2014, we amended his Proprietary Interest Agreement to provide that if Danaher terminates Mr. Joyce’s employment without cause, in addition to the 12 months of base salary already provided for under the agreement and as additional consideration for Mr. Joyce’s obligations under the agreement, Danaher will (1) pay him an amount equal to the average of the annual cash incentive compensation awards paid to him with respect to the three most recent, completed calendar years prior to the date of termination (the “Three-Year Average Annual Bonus”), (2) pay him an amount equal to a prorated portion of the Three-Year Average Annual Bonus (capped at 250% of his annual base salary rate as of the termination date), based on the number of days he is employed by Danaher in the year of termination divided by 365, and (3) accelerate the time-based vesting applicable to his outstanding equity awards such that a pro rata portion of such awards will be deemed vested, based on the number of days between the grant date and termination date divided by the total number of days in the original vesting term of the award. All other provisions of Mr. Joyce’s Proprietary Interest Agreement remain the same.
Letter Agreement with Angela S. Lalor
Danaher entered into a letter agreement with Ms. Lalor on March 19, 2012 in connection with her hiring as Danaher’s Senior Vice President-Human Resources in April 2012. Pursuant to the letter agreement, Ms. Lalor is entitled to:
73 |
Back to Contents |
|
Officers’
Danaher’s Certificate of Incorporation requires it to indemnify to the full extent authorized or permitted by law any person made, or threatened to be made a party to any action or proceeding by reason of his or hertheir service as a director or officer of Danaher, or by reason of serving at Danaher’s request as a director or officer of any other entity, subject to certain exceptions. Danaher’s Bylaws provide for similar indemnification rights. In addition, each of Danaher Corporation’s directors and executive officers has executed an indemnification agreement with Danaher that provides for substantially similar indemnification rights and under which Danaher has agreed to pay expenses in advance of the final disposition of any such indemnifiable proceeding. Danaher also has in effect directors and officers liability insurance covering all of Danaher’s directors and officers.
General. The Compensation Committee of the Board of Directors of Danaher (the “Administrator”) administers the Omnibus Plan. The following awards may be granted under the Omnibus Plan: stock options, SARs, restricted stock, RSUs and other stock-based awards (including PSUs), as such terms are defined in the Omnibus Plan, as well as cash-based awards (collectively, all such awards are referred to as “awards”).
126,846,408 shares of Common Stock have been authorized for issuance under the Omnibus Plan (the “Maximum Share Limit”). Under the terms of the plan, grants of full-value awards (i.e., any award other than an option or SAR) count against the Maximum Share Limit at a ratio of 3.56:1 (such that (1) each share of Common Stock subject to a full value award and granted before February 28, 2017 counts against the Maximum Share Limit as one share of Common Stock, (2) each share of Common Stock subject to a full value award and granted after February 28, 2017 counts against the Maximum Share Limit as 3.56 shares of Common Stock, and (3) if after February 28, 2017 any full value award expires, is canceled, forfeited, cash-settled, exchanged or assumed by a third party or terminates for any other reason, in each case without a distribution of shares of Common Stock to the participant, each share of Common Stock available under that award is added back to the Maximum Share Limitpool of shares available for grant as 3.56 shares of Common Stock).Stock. The plan caps the number of shares of Common Stock that may be awarded to any individual in any calendar year (1) under options or SARs at 1,000,000 and (2) under any other type ofstock-based award intended to be “qualified performance based compensation” under Section 162(m) at 500,000, provided that these caps arethis cap is doubled in the initial year of hire. Cash-based awards under the plan are subject to an annual limit of $10 million (which amount is doubled in the initial year of hire) per employee participant. The plan also caps the annual cash and equity compensation (based on grant date fair value) that may be awarded to any individual,non-management director at $800,000 ($1,300,000 for anynon-management Board chair or vice chair (or similar role)).
The following shares of Common Stock do not again become available for awards or increase the number of shares available for grant under the plan: shares of Common Stock (1) tendered by the participant or withheld by the Company in payment of the purchase price of an option or SAR, (2) tendered by the participant or withheld by the Company to satisfy any tax withholding obligation under the plan, (3) repurchased by the Company with proceeds received from the exercise of an option, or (4) subject to a SAR that are not issued in connection with the stock settlement of that SAR upon its exercise.
All equity awards granted following the date of the Company’s 2017 annual meeting are subject to a minimumone-year vesting or performance requirement, except that (1) up to five percent (5%) of the Maximum Share Limit under the plan may be issued without regard to this minimum vesting period, (2) this minimum vesting period does not apply in the event of death, disability, retirement or other terminations of employment or service, and (3) the Administrator may waive the minimum vesting requirement in the event of a substantial corporate change.
Performance Rules. Awards under the Omnibus Plan may be subject to time-based and/or performance-based vesting conditions. Awards subject to performance-based vesting conditions may be designed to satisfy the exemption from Section 162(m)’s deduction limit for performance-based compensation based on one, or a combination, of the performance-based criteria set forth in the plan, although the exemption has been repealed effective for taxable years beginning after December 31, 2017 (subject to limited transition relief).
2023 PROXY STATEMENT | 74 |
Subject to certain terms and conditions set forth in the Omnibus Plan or the applicable award agreement (including the overall term of the award), in general:
• | upon retiring after reaching age 65, (1) a participant’s unvested options held for at least six months prior to retirement continue to vest and, together with any options that are vested as of the retirement date, remain outstanding and (once vested) may be exercised until the fifth anniversary of the retirement date (or the tenth anniversary
Upon terminations of employment other than retirement (as defined under the Omnibus Plan), unless the Administrator determines otherwise any options or SARs that are vested as of a participant’s termination of employment (including any options or SARs the vesting of which accelerates as a result of the participant’s death) will remain exercisable until the earlier of the expiration of the award’s term or (1) 12 months after termination, if the termination results from the participant’s death or disability, (2) in the Administrator’s discretion, at the time of termination if the participant’s employment is terminated for gross misconduct, or (3) 90 days following the termination date, in all othernon-retirement situations. If an award survives for any period of time following termination of employment, it will nonetheless terminate as of the date that the participant violates any post-employment covenant between Danaher and the participant. In addition, upon termination of a participant’s employment or service due to death, generally (1) all of the participant’s outstanding stock options granted under the Omnibus Plan become fully vested, (2) the vesting of a pro rata portion of
Recoupment
Term of Plan
Supplemental Retirement Program
Danaher uses the Executive Deferred Incentive Program, or EDIP, and the Excess Contribution Program, or ECP (which is a EDIPAt the beginning of each plan year, Danaher credits to the account of each EDIP participant A participant vests in the amounts that Danaher credits to their EDIP account as follows:
ECPUnder the ECP, on or about February 1 after the applicable year of participation, Danaher credits to the account of each participant an excess matching contribution and excess non-elective contribution based on the formulas in the Company’s 401(k) plan for matching and non-elective contributions. As a result, each participant can receive the following contributions in the ECP:
A participant vests in the matching contribution in the ECP made each year on the first anniversary after it is credited to the participant’s account. A participant vests in the non-elective contribution in the ECP made each year on the later of the first anniversary after it is credited to the participant’s account, or the date the participant has completed three years of service with Danaher. If a participant dies while employed by Danaher, their vesting percentage equals 100%.
Voluntary DeferralsEach DCP participant is permitted to voluntarily defer into the program, on a pre-tax basis, up to 85% of
Distributions
Certain events, such as the participant’s death or an unforeseeable emergency, may impact the timing of a distribution under the EDIP, the ECP or the DCP.
GeneralUnder the EDIP, the ECP and the DCP, Danaher contributions and amounts voluntarily deferred are unfunded and unsecured obligations of Danaher, Senior Leader Severance Pay PlanEach of Danaher’s executive officers (in addition to certain other categories of employees as specified in the plan) is entitled to certain benefits under Danaher’s Senior Leader Severance Pay Plan. If a covered employee is terminated without “cause” (as defined below) and except in certain circumstances as specified in the plan, subject to execution of Danaher’s standard form of release Under the plan, “cause” is defined as (1) the employee’s dishonesty, fraud, misappropriation, embezzlement, willful misconduct or gross negligence with respect to, or any other action in willful disregard of the interests of, Danaher or its affiliates; (2) the employee’s conviction of, or pleading guilty or no contest to (i) a felony, (ii) any misdemeanor (other than a traffic violation), or (iii) any other crime or activity that would impair the employee’s ability to perform duties or impair the business reputation of Danaher or its affiliates; (3) the employee’s willful failure or refusal to satisfactorily perform any duties assigned to the employee; (4) the employee’s failure or refusal to comply with Company standards, policies or procedures, including without limitation the
PROPOSAL 3 |
• |
• | Continued to evolve its portfolio by announcing the intention to separate its Environmental & Applied Solutions segment in the fourth quarter of 2023 to create a separate, publicly traded company (to be known as Veralto Corporation), which will further advance Danaher’s science and technology transformation. | |
• | Invested aggressively in future growth, | |
• | Returned approximately $700 million to common shareholders through cash dividends | |
• | Increased revenues by 7% and |
• | 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 |
2023 PROXY STATEMENT | 79 |
Our executive compensation program operates within a strong framework of compensation governance. Our Compensation Committee regularly reviews external executive compensation practices and trends and incorporatesincorporated best practices into our 2022 executive compensation program:
WHAT WE DO |
| WHAT WE DON’T DO | |||||||||
No taxgross-up provisions | |||||||||||
Incentive compensation programs feature multiple, differentperformance measures aligned with | No dividend/dividend equivalents paid on unvested equityawards | ||||||||||
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 | ||||||||||
Limited perquisites and a cap on CEO/CFO personal aircraft usage | No | ||||||||||
Independent compensation consultant that performs no other services for the Company | No |
We are asking our shareholders to indicate their support for our named executive officer compensation as described in this Proxy Statement. Accordingly, we are asking our shareholders to vote on an advisory basis “FOR” the followingnon-binding resolution:
“RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, compensation tables and narrative discussion, is hereby approved.”
Although this advisory vote isnon-binding, our Board and Compensation Committee will review the voting results and take them into consideration when making future decisions regarding our named executive officer compensation programs.
The
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE RESOLUTION SET FORTH IN PROPOSAL 3. |
2023 PROXY STATEMENT | 80 |
In accordance with Section 14A of the Exchange Act, we are asking our shareholders to vote at the 2023 Annual Meeting to indicate on an advisory basis how frequently we should seek an advisory vote on the compensation of our named executive officers. By voting on this Proposal 4, shareholders may indicate whether they would prefer an advisory vote on named executive officer compensation every one, every two, or every three years.
Danaher has been holding an annual say-on-pay vote since 2011, and after careful consideration of this proposal, our Board of Directorshas determined that an advisory vote on named executive officer compensation that occurs every year continues to be the most appropriate alternative for Danaher at this time, and therefore our Board recommends that you vote for a one-year interval for the advisory vote on named executive officer compensation. In formulating its recommendation, our Board considered that an annual advisory vote on named executive officer compensation allows our shareholders to provide us with their direct input on our executive compensation program as disclosed in the proxy statement every year.
You may cast your vote FORon your preferred voting frequency by choosing the option of one year, two years, three years or abstain from voting when you vote, on an advisory basis, in response to the following non-binding resolution.
“RESOLVED, that the option of every one year, every two years, or every three years that receives the highest number of votes cast for this resolution will be considered to be the preferred frequency of the shareholders with which the Company is to hold future shareholder advisory votes on named executive officer compensation.”
The option of every one year, every two years or every three years that receives the highest number of votes cast by shareholders will be the frequency for the advisory vote on named executive officer compensation that has been recommended by shareholders. However, because this vote is advisory and not binding on the Board, the Board may decide that it is in the best interests of our shareholders and Danaher to hold an advisory vote on named executive compensation more or less frequently than the option approved by our shareholders.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE FOR ADVISORY VOTES RELATING TO THE COMPANY’S NAMED EXECUTIVE OFFICER COMPENSATION TO BE HELD EVERY ONE YEAR. |
2023 PROXY STATEMENT | 81 |
The Company has been informed that John Chevedden, 2215 Nelson Avenue, No. 205, Redondo Beach, CA, 902778, a beneficial owner of shares of our common stock having a minimum value as set forth in Proposal 3.
PROPOSAL 4 — SHAREHOLDER PROPOSAL REQUESTING THAT DANAHER AMEND ITS GOVERNING DOCUMENTS TO REDUCE PERCENTAGE OF SHARES REQUIRED FOR SHAREHOLDERS TO CALL SPECIAL MEETING FROM 25% TO 10%
A Danaher shareholder has notified us that heRule 14a-8 of the Exchange Act allowing submission of proposals by stockholders meeting certain requirements, intends to present the following proposal for considerationset forth below at the Annual Meeting. The name, address and number of shares held by such shareholder are available upon request to Danaher’s Secretary.Company is not responsible for any inaccuracies it may contain.
Proposal 45 – Special Shareholder Meeting ImprovementIndependent Board Chairman
Resolved, Shareowners ask
Shareholders request that the Board of Directors adopt an enduring policy, and amend the governing documents as necessary in order that 2 separate people hold the office the Chairman and the office of the CEO.
Whenever possible, the Chairman of the Board shall be an Independent Director.
The Board has the discretion to select a Temporary Chairman of the Board who is not an Independent Director to serve while the Board is seeking an Independent Chairman of the Board on an accelerated basis.
It is a best practice to adopt this policy soon. However this policy could be phased in when there is a contract renewal for our board to takecurrent CEO or for the steps necessary (unilaterally if possible) to amend our bylaws and each appropriate governing document to give holders in the aggregate of 10% of our outstanding common stock the power to call a special shareowner meeting. This proposal does not impact our board’s current power to call a special meeting.next CEO transition.
Scores of Fortune 500 companies allow 10% of shares to call a special meeting compared to Danaher Corporation’s more difficult requirement. Danaher shareholders do not have the full right to call a special meeting that is available under state law.
Special meetings allow shareowners to vote on important matters, such as electing new directors that can arise between annual meetings. This proposal topic won more than 70%-support52% support at Edwards LifesciencesBoeing and SunEdison54% support at Baxter International in 2013.2020. Boeing then adopted this proposal topic. The roles of Chairman and CEO are fundamentally different and should be held by 2 directors, a CEO and a Chairman who is completely independent of the CEO and our company.
A lead director is no substitute for an independent Board Chairman. The Special Shareholder Meeting Improvement proposal topic won 40%-support at the 2016 Danaher annual meeting. This 40%-support would have been higher (possibility 45%) if small shareholders had the same access to corporate governance information as large shareholders.
An enhanced ability of shareholders to call a special meeting would give shareholders greater standing to have input for improving the makeup of our board of directors after the 2018 annual meeting. There is a special need for improvement.
For example, the directors on our Audit Committee received up to20-times as may negative votes as other directors. The Audit Committee directors were:
Teri List-Stoll
Donald Ehrlich
John Schwieters
50% of our directors had 14 to 34 years long-tenure. Long-tenure can impair the independence of a director no matter how well qualified. Independence is a high value attribute in a director.
Donald Ehrlich, our Lead Director, had34-years long-tenure. The Lead Director position has extra oversight of our CEO compared to other directors. Long-tenure can impairMs. Linda Filler violates the independencemost important attribute of a Lead Director. ADirector – independence. As director tenure goes up director independence goes down. Ms. Filler has 18-years director tenure at Danaher. It is amazing the number of companies that claim that a Lead Director needsis some sort of substitute for an independent Board Chairman and then select a director with the longest tenure as Lead Director. Ms. Filler received 107 million against votes in 2022.
One of the primary functions of an independent Chairman of the Board is the manage the Board of Director which is lacking at Danaher. For example 5 Danaher directors each received between 100 million and 200 million against votes each in 2022:
Linda Filler, lead director.
Teri List
Walter Lohr, age 79, overdue for retirement with 40-years DHR director tenure.
Shane Sanders, sad since Mr. Sanders is a relatively new director.
John Schwieters, age 83, overdue for retirement with 20-years DHR director tenure.
According to be more independent than any other director.the 2022 annual meeting proxy the Danaher so-called Lead Director has only 4 duties:
Presides over certain meetings if they occur in a given year.
Can call a meeting of certain directors but cannot call a meeting of the entire Board.
Can act as a liaison but only as necessary.
Can edit the Board’s agenda.
The ascending complexities of a company with $175 Billion in market capitalization, like Danaher, increasingly demand that 2 persons fill the 2 most important jobs at Danaher on an enduring basis – Chairman and CEO
Please vote to enhance director accountability to shareholders:yes:
Special Shareholder Meeting Improvement
Independent Board Chairman – Proposal 45
2023 PROXY STATEMENT | 82 |
The proponent’s proposal is clearly not based on a careful analysis or understanding of Danaher’s leadership structure, given that the proposal suggests a need to separate Danaher’s CEO and Chair positions despite the fact that these positions have been separated for more than thirty years. It is not surprising therefore that the balance of the proposal, suggesting the need for an independent chair, similarly reflects little understanding of the significant benefits of the Company’s current leadership structure and the extremely strong shareholder returns Danaher has generated since such structure has been in place.
The Board recommends that you vote against this shareholder proposal because our current leadership structure (with Steven Rales as executive Chairman and Ms. Filler as Lead Independent Director (“LID”)), already achieves the independent leadership and effective management oversight sought by the proponent and has served the Company and its shareholders exceptionally well:
• | During Mr. Rales’ tenure as Danaher’s Chairman of the Board (which began in 1984), Danaher has realized a compounded, average annual shareholder return of 21.7% (compared to 10.8% for the S&P 500 Index over the same time period) and a total shareholder return of over 173,954% (compared to approximately 5,345% for the S&P 500 Index over the same period). |
• | Danaher has outperformed the compounded, average annual shareholder return of the S&P 500 Index over each of the last two, three-, five-, ten-, fifteen-, twenty- and twenty-five year periods, with a return of 9.7% over the last two years, 20.5% over the last three years, 23.9% over the last five years, 20.7% over the last ten years, 15.3% over the last fifteen years, 16.9% over the last twenty years and 16.7% over the last twenty-five years. |
Our Board believes that as a result of his substantial ownership stake in the Company, Mr. Rales is uniquely able to understand, articulate and advocate for the following reasons:rights and interests of the Company’s shareholders. Moreover, Mr. Rales uses his management experience with the Company and his Board tenure to help ensure that the non-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’s day-to-day business.
Our Board has further bolstered its leadership structure by appointing an independent and active LID. As LID, Ms. Filler presides at all meetings of the Board at which the Chairman of the Board and the Chairman of the Executive Committee are not present, including the executive sessions of non-management directors, which are typically held at the end of each regularly scheduled Board meeting; has the authority to call meetings of the independent directors; serves as a liaison between the Chairman and the independent directors, engaging frequently with Mr. Steven Rales on a range of topics relating to the Board and the Company’s governance program; approves information sent to the Board; approves meeting agendas for the Board; approves meeting schedules to assure that there is sufficient time for discussion of all agenda items; and engages with major shareholders, including direct communication, as appropriate. Ms. Filler’s role as Chair of 25%the Board’s Nominating and Governance Committee complements her LID role and further strengthens her Board leadership, as she leverages her deep insights regarding the Board’s composition, performance and governance.
We also believe that an assessment of the appropriateness of a company’s board leadership structure should be made on a holistic basis, taking into consideration the company’s overall governance structure. We embrace numerous corporate governance best practices designed to ensure independent leadership and full accountability to our outstandingshareholders, as further detailed on page 22.
While the leadership structure that the proponent reflexively proposes may be appropriate for the other companies cited in the proposal, we believe that the proposed structure would significantly diminish the accountability and stewardship that our shareholders currently enjoy as a result of Mr. Rales’ and Ms. Filler’s leadership. Our Board has no established policy on whether or not to separate the Chair and CEO roles and have a non-executive chairman and firmly believes it is important to retain the flexibility to adopt the leadership structure most effective under the applicable facts and circumstances.
THE BOARD OF DIRECTORS RECOMMENDS THAT SHAREHOLDERS VOTE AGAINST PROPOSAL 5 |
2023 PROXY STATEMENT | 83 |
The Company has been informed that As You Sow, on behalf of Eliana Fishman, 1833 9th Street NW, Washington, DC 20001, a beneficial owner of 36 shares of Danaher common stock, haveand Minnesota Valley Trust, 1960 Cedar Lake Parkway, Minneapolis, MN 55416, a beneficial owner of 129 shares of Danaher common stock, intends to present the right to call a special meeting, pursuant to aproposal set forth below at the Annual Meeting. The Company proposal previously approved by our shareholders. Our Board continues to believe that this threshold ensures a reasonable number of shareholders consider a matter important enough to merit a special meeting.
RESOLVED: Shareholders request that Danaher Corp. (“Danaher”) report to shareholders on the effectiveness of Danaher’s fourteen peer companies:
SUPPORTING STATEMENT: Quantitative data is sought so investors can assess and compare the effectiveness of companies’ diversity, equity, and inclusion programs.
WHEREAS: Danaher has not shared sufficient quantitative hiring, retention, and promotion data to allow investors to determine the effectiveness of its human capital management programs. Best practice disclosure includes hiring, retention, and promotion rate data by gender, race, and ethnicity in line with Equal Employment Opportunity Commission (EEOC) defined categories.
Between September 2020 and September 2022, S&P 100 companies increased by 298 percent their release of hiring rate data by gender, race, and ethnicity; retention rate data by 481 percent; and promotion rate data by 300 percent.1
Companies that release, or have committed to release, more inclusion data than Danaher include Ecolab, Gilead Sciences, and Illumina. Danaher is increasingly a laggard in its decision to continue to withhold these data sets.
Numerous studies have pointed to the benefits of a diverse workforce:
• | There is a positive association between diversity in management and cash flow, net profit, revenue, and return on equity. | |
• | Companies in the top quartile for gender diversity are 21 percent more likely to outperform on profitability.3 | |
• | The 20 most diverse companies had an average annual five-year stock return that was 5.8 percentage points higher than the 20 least diverse companies.4 |
Similar to how an income statement pairs with a balance sheet, hiring, promotion, and retention rate data show how well a company manages its workforce diversity. Without this data, investors are unable to assess the effectiveness of a company’s human capital management program.
Companies should look to hire the best talent. However, Black, and Latino applicants face hiring challenges. Results of a meta-analysis of 24 field experiments found that, with identical resumes, White applicants received an average of 36 percent more callbacks than Black applicants and 24 percent more callbacks than Latino applicants.5
Promotion rates show how well diverse talent is nurtured at a company. Unfortunately, women and employees of color experience “a broken rung” in their careers; for every 100 men who are promoted, only 86 women are. Women of color are particularly impacted, comprising 17 percent of the entry-level workforce and only four percent of executives.6
Retention rates show whether employees choose to remain at a company. Morgan Stanley has found that employee retention above industry average can indicate a competitive advantage and higher levels of future profitability.7 Companies with high employee satisfaction have also been linked to annualized outperformance of over two percent.8
1 | https://www.asyousow.org/our-work/social-justice/workplace-equity | |
2 | https://www.asyousow.org/report-pages/workplace-diversity-and-financial-performance | |
3 | https://www.mckinsey.com/business-functions/people-and-organizational-performance/our-insights/delivering-through- diversity | |
4 | https://www.wsj.com/articles/the-business-case-for-more-diversity-11572091200 | |
5 | https://hbr.org/2017/10/hiring-discrimination-against-black-americans-hasnt-declined-in-25-years | |
6 | https://wiw-report.s3.amazonaws.com/Women_in_the_Workplace_2021.pdf | |
7 | https://www.morganstanley.com/im/publication/insights/articles/article_culturequantframework_us.pdf | |
8 | https://www.institutionalinvestor.com/article/b1tx0zzdhhnf5x/Want-to-Pick-the-Best-Stocks-Pick-the-Happiest-Companies?utm_ medium=email&utm_campaign=The%20Essential%20II%20100721&utm_content=The%20Essential%20II%20100721%20CID_ eb103a9e15359075f72a85f7ff534c79&utm_source=CampaignMonitorEmail&utm_term=Want%20to%20Pick%20the%20Best%20Stocks% 20Pick%20the%20Happiest%20Companies |
2023 PROXY STATEMENT | 84 |
• | Overview | |
• | Danaher has demonstrated that diversity, equity and inclusion (“DEI”) is a strategic priority with active support from the Board and executive management; has set ambitious DEI improvement goals and made meaningful progress toward achieving those goals; and has been highly transparent in quantifying the performance of its DEI program. We encourage you to review the “Diversity + Inclusion” section of our most recent sustainability report available in the “Sustainability” section of Danaher’s website at http://www.danaher.com. | |
• | Given that Danaher’s extensive disclosures already give investors the data they need to assess the effectiveness of our DEI program, the proponents’ request for a special report – as well as their request for additional, highly granular demographic data that few companies publish -- would be an unnecessary and inefficient use of resources that would serve only the limited interests of a small group of shareholders. | |
• | The proponents’ statement is misleading in a number of respects. They do not disclose the number of companies that actually disclose the granular data they are seeking (despite referring to such data disclosure as “best practice”). They cite year-over-year percentage increases in disclosures of certain categories of data among the S&P 100, yet the data categories for which they provide these percentages are much more general than the extremely granular disclosures they are seeking from Danaher. |
• | Leadership support. Danaher’s annual sustainability report demonstrates a strategic commitment to DEI at the highest levels of our organization. Among other initiatives, we require every people leader (including our executive officers) to have a | |
• | Goals and progress. We have set ambitious, public goals to improve our gender and People of Color (“POC”) diversity and have demonstrated meaningful progress toward achieving these goals: | |
• | 2025 goal: 40% female representation in global workforce. As of December 31, 2022, 38% of Danaher’s | |
• | 2025 goal: 38% POC representation in U.S. workforce. As of December 31, 2022, 41% of Danaher’s U.S. employees were POCs. | |
• | Transparency and quantitative data. We have | |
• | Employee demographic data by gender, race and age |
– | For each of gender and race, we disclose data on an overall basis and in sub-categories based on job level (and in the case of gender, by geography) |
■ | For the U.S., we provide even further granularity by disclosing job level |
Preparing for and holding a special meeting, like the annual meeting, is time-consuming and expensive. If adopted, this proposal would have the effect of allowing a relatively small percentage of shareholders with potentially narrow interests to call an unlimited number of special meetings to consider matters that may not be in the best interests of all of our shareholders. We believe the 25% threshold strikes 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.
In the best interests of our shareholders and Company, we recommend that you vote against this shareholder proposal.
The Board of Directors recommends that shareholders vote AGAINST Proposal 4.
• | New hire data by gender and (for the U.S.) People of Color | ||
• | U.S. pay equity by gender and race | ||
– | Since 2020, we have achieved and maintained pay equity (with respect to salary and short-term incentive compensation) for women and for racial and ethnic minorities in the U.S. based on an analysis of weighted median base pay. |
• | Voluntary and involuntary turnover | |
• | Internal fill rate | |
• | Full-time, part-time and temporary employees | |
• | Conclusion. We are devoting significant time and resources to advancing our DEI strategy and achieving our strategic DEI objectives. Diverting those resources to address the proponents’ interest in a specialized report and a set of additional, intricate data that few companies, and none of Danaher’s peer companies, provide would be inefficient and costly without adding significant value to our shareholders. In addition, As You Sow’s own top-decile ranking of Danaher’s DEI disclosure practices suggest that Danaher’s disclosures already reflect the best practices espoused by the proponents. |
2023 PROXY STATEMENT | 85 |
This Proxy Statement is furnished in connection with the solicitation by the Board of Directors of Danaher Corporation, a Delaware corporation, of proxies for use at the 20182023 Annual Meeting of Shareholders and at any and all postponements or adjournments thereof.
You are entitled to vote at the Annual Meeting if you owned any shares of Danaher Common Stock at the close of business on March 12, 2018,10, 2023, which is referred to as the “record date.” A list of registered shareholders entitled to vote at the meeting will be available at Danaher’s offices, 2200 Pennsylvania Avenue, N.W., Suite 800W, Washington, D.C. 20037-1701 during the ten days prior to the meeting, and also at the meeting.
We are furnishing proxy materials to our shareholders primarily via the Internet, instead of mailing printed copies of those materials to each shareholder. By doing so, we save costs and reduce the environmental impact of our Annual Meeting. On or about March 28, 2018,29, 2023, we mailed a Notice of Internet Availability to certain of our shareholders. The Notice contains instructions about how to access our proxy materials and vote online. If you would like to receive a paper copy of our proxy materials, please follow the instructions included in the Notice of Internet Availability. If you previously chose to receive our proxy materials electronically, you will continue to receive access to these materials via email unless you elect otherwise.
You or your authorized proxy can attend the Annual Meeting if you were a registered or beneficial shareholder of Danaher Common Stock atas of the close of business on March 12, 2018.10, 2023 or if you hold a valid proxy for the Annual Meeting. Please be prepared to present government-issued photo identification for admittance. If your shares are registered in your name with Danaher’s stock registrar and transfer agent, Computershare Trust Company, N.A. (“Computershare”) or you hold your shares through the Danaher Corporation & Subsidiaries Savings Plan (the “401(k) Plan”) or the Danaher Corporation & Subsidiaries Retirement and Savings Plan (collectively with the 401(k) Plan, the “Savings Plans”), your name will be verified against the list of shareholders of record or plan participants on the record date prior to your being admitted to the Annual Meeting. If you are not a shareholder of record or a Savings Plan participant but hold shares through a bank, broker, trustee or other intermediary (i.e.(i.e., in street name), you should also be prepared to provide proof of beneficial ownership as of the record date, such as a recent brokerage account statement showing your ownership, a copy of the voting instruction form provided by your bank, broker, trustee or other intermediary, or other similar evidence of ownership.
Under the Company’s Bylaws, we can conduct business at the Annual Meeting only if the holders of a majority of the issued and outstanding shares of Danaher Common Stock entitled to vote at the Annual Meeting as of the record date are present either in person or by proxy. The presence of at least that number of shares constitutes a “quorum.” Abstentions and brokernon-votes will be counted as present in determining whether the quorum requirement is satisfied. As of the record date, 698,442,608729,106,753 shares of Danaher Common Stock were outstanding, excluding shares held by or for the account of Danaher.
2023 PROXY STATEMENT | 86 |
If you own shares directly in your name…name...
If your shares are registered directly in your name with Computershare,our transfer agent, you are considered theregistered holder of those shares. As theregistered shareholder, you may vote in several different ways:
• | Vote on the Internet. You can vote online at: www.proxyvote.com. |
• | Vote by Telephone. In the United States or Canada, you can vote by telephone by calling the number included in the printed proxy materials, if you received printed proxy materials.Easy-to-follow voice prompts allow you to vote your shares and confirm that your instructions have been properly recorded. |
|
Internet and telephone voting facilities will be available 24 hours a day until 11:59 p.m., Central time, on May 7, 2018
Internet and telephone voting facilities will be available 24 hours a day until 11:59 p.m. Eastern Time on May 8, 2023 (except for participants in the Savings Plans, who must submit voting instructions earlier, as described below). To authenticate your Internet or telephone vote, you will need to enter your confidential voter control number as shown on the voting materials you received. If you vote online or by telephone, you do not need to return a proxy card.
• | Vote by Mail. You can mail the proxy card enclosed with your printed proxy materials, if you received printed proxy materials. Mark, sign and date your proxy card and return it in the postage-paid envelope provided, or in an envelope addressed to |
If you hold shares in either of the Danaher Savings Plans...
You can direct Fidelity Management Trust Company (“Fidelity”), the trustee of the Savings Plans, to vote your proportionate interest in the shares of Common Stock held under the Savings Plan by returning a voting instruction form or by providing voting instructions via the Internet or by telephone. Fidelity will vote your Savings Plan shares as of the record date in the manner directed by you. Because Fidelity is designated to vote on your behalf, you will not be able to vote your shares held in the Savings Plan in person at the meeting. If Fidelity does not receive voting instructions from you by 11:59 p.m. Eastern time on May 4, 2023, Fidelity will not vote your Savings Plan shares on any of the proposals brought at the Annual Meeting.
If you own your shares through an account with a bank, broker, trustee or other intermediary, sometimes referred to as owning in “street name”...
If you hold shares in either of the Danaher Savings Plans…
You can direct Fidelity Management Trust Company (“Fidelity”), the trustee of the Savings Plans, to vote your proportionate interest in the shares of Common Stock held under the Savings Plan by returning a voting instruction form or by providing voting instructions via the Internet or by telephone. Fidelity will vote your Savings Plan shares as of the record date in the manner directed by you. Because Fidelity is designated to vote on your behalf, you will not be able to vote your shares held in the Savings Plan in person at the meeting. If Fidelity does not receive voting instructions from you by 1:00 a.m. Eastern time on May 4, 2018, Fidelity will not vote your Savings Plan shares on any of the proposals brought at the Annual Meeting.
If you own your shares through an account with a bank, broker, trustee or other intermediary, sometimes referred to as owning in “street name” . . .
Your intermediary will provide instructions on how to access proxy materials electronically, or send you printed copies of the proxy materials if you so elect. You are entitled to direct the intermediary how to vote your shares by following the voting instructions it provides to you.
Shareholders who hold shares directly with the Company may attend the meeting and vote in person, or may execute a proxy designating a representative to attend and vote on their behalf. If you do not hold your shares directly with us and they are instead held for you in a brokerage, bank or other institutional account, you may attend and vote in person if you obtain a proxy from that institution in advance of the meeting and bring it with you to hand in along with the ballot that will be provided.
2023 PROXY STATEMENT | 87 |
If you hold shares of Common Stock registered in your name, you may revoke your proxy:
• | by filing a written notice of revocation with the Secretary of Danaher; |
• | if you submitted your proxy by telephone or via the Internet, by accessing those voting methods and following the instructions given for revoking a proxy; |
• | if you submitted a signed proxy card, by submitting a new proxy card with a later date (which will override your earlier proxy card); or |
• | by voting |
If you hold your shares in “street name,” you must follow the directions provided by your bank, broker, trustee or other intermediary for revoking or modifying your voting instructions.
Each outstanding share of Danaher Common Stock entitles the holder to one vote on each directorship and other matter brought before the Annual Meeting. Your shares will be voted in accordance with your instructions. The Board has selected Steven M. Rales, Mitchell P. Rales, Brian W. Ellis and James F. O’Reilly, or any of them, to act as proxies with full power of substitution. All votes will be counted by the inspector of election appointed for the meeting.
In addition, if you have returned a signed proxy card or submitted voting instructions by telephone or online, the proxy holders will have, and intend to exercise, discretion to vote your shares (other than shares held in the Savings Plans) in accordance with their best judgment on any matters not identified in this Proxy Statement that are properly brought to a vote at the Annual Meeting. At present we do not know of any such additional matters.
If your shares are registered in your name and you sign and return a proxy card or vote by telephone or online but do not give voting instructions on a particular matter, the proxy holders will be authorized to vote your shares on that matter in accordance with the Board’s recommendation. If you hold your shares through an account with a bank, broker, trustee or other intermediary and do not give voting instructions on a matter, we expect that under the rules of the New York Stock Exchange the bank, broker, trustee or other intermediary will be permitted to vote in its discretion only on Proposal 2 and will not be permitted to vote on any of the other Proposals, resulting in a so-called “broker non-vote.” The impact of abstentions and broker non-votes on the overall vote is shown in the following table. Broker non-votes will not affect the attainment of a quorum since the bank, broker, trustee or other intermediary has discretion to vote on Proposal 2 and these votes will be counted toward establishing a quorum.
2023 PROXY STATEMENT | 88 |
Votes Required and Effect of Abstentions and Broker Non-Votes
Matter | Required Vote | Impact of Abstentions | Impact of Broker Non-Votes | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPOSAL 1 – ELECTION OF DIRECTORS (PAGE 14) | Votes cast FOR a nominee must exceed number of votes cast AGAINST that nominee. | Not counted as votes cast; no impact on outcome. | Not counted as votes cast; no impact on outcome. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPOSAL 2 – RATIFICATION OF THE APPOINTMENT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM (PAGE 38) | Approval by a majority of shares of Danaher Common Stock
| Counted for purposes of determining minimum number of affirmative votes required for approval; impact is the same as a vote AGAINST. | Not applicable. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPOSAL 3 – ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION (PAGE 79) | Approval by a majority of shares of Danaher Common Stock represented in person or by proxy and entitled to vote on the proposal. | Counted for purposes of determining minimum number of affirmative votes required for approval; impact is the same as a vote AGAINST. | Not counted as shares of Danaher Common stock represented in person or by proxy and entitled to vote on the proposal; no impact on outcome. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPOSAL 4 – ADVISORY VOTE RELATING TO THE FREQUENCY OF FUTURE SHAREHOLDER ADVISORY VOTES ON THE COMPANY’S NAMED EXECUTIVE OFFICER COMPENSATION (PAGE 81) | Approval by a majority of shares of Danaher Common Stock represented in person or by proxy and entitled to vote on the proposal. If none of the | Abstentions will not affect the | Not counted as shares of | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PROPOSAL 5 – SHAREHOLDER PROPOSAL (PAGE 82) | Approval by a majority of shares of Danaher Common Stock represented in person or by proxy and | Counted for purposes of determining minimum number of affirmative votes | Not counted
|
The proxies being solicited hereby are being solicited by Danaher’s Board. Employees of Danaher may solicit proxies on behalf of the Board of Directors by mail, email, in person and by telephone. These employees will not receive any additional compensation for these activities. Danaher will bear the cost of soliciting proxies and will reimburse banks, brokers, trustees and other intermediaries for their reasonable out-of-pocket expenses for forwarding proxy materials to shareholders. We have retained Broadridge Financial Services, Inc. to aid in distributing proxy materials and the solicitation of proxies. For these services, we expect to pay Broadridge a fee of less than $15,000 and reimburse it for certain out-of-pocket expenses for forwarding proxy materials to shareholders. We have retained Georgeson Shareholder Communications, Inc. to aid in distributing proxy materials and the solicitation of proxies. For these services, we expect to pay Georgeson a fee of less than $15,000 and reimburse it for certainout-of-pocket disbursements and expenses.
Eliminating Duplicate Mailings
Danaher has adopted the “householding” procedure approved by the SEC, which allows us to deliver one set of documents to a household of shareholders instead of delivering a set to each shareholder in a household, unless we have been instructed otherwise. This procedure is more environmentally friendly and cost-effective because it reduces the number of copies to be printed and mailed. Shareholders who receive proxy materials in paper form will continue to receive separate proxy cards/voting instruction forms to vote their shares. Shareholders who receive the Notice of Internet Availability will receive instructions on submitting their proxy cards/voting instruction form via the Internet.
If you would like to change your householding election, request that a single copy of the proxy materials be sent to your address, or request a separate copy of the proxy materials, please contact Computershare at800-568-3476. We will promptly deliver the proxy materials to you upon receipt of your request. If you own your shares in “street name,” please contact your broker, bank, trustee or other intermediary to make your request.
If you receive more than one proxy card/voting instruction form, your shares probably are registered in more than one account or you may hold shares both as a registered shareholder and through one of the Savings Plans. You should vote each proxy card/voting instruction form you receive.
Danaher has adopted the “householding” procedure approved by the SEC, which allows us to deliver one set of documents to a household of shareholders instead of delivering a set to each shareholder in a household, unless we have been instructed otherwise. This procedure is more environmentally friendly and cost-effective because it reduces the number of copies to be printed and mailed. Shareholders who receive proxy materials in paper form will continue to receive separate proxy cards/voting instruction forms to vote their shares. Shareholders who receive the Notice of Internet Availability will receive instructions on submitting their proxy cards/voting instruction form via the Internet.
2023 PROXY STATEMENT | 89 |
If you would like to change your householding election, request that a single copy of the proxy materials be sent to your address, or request a separate copy of the proxy materials, please contact our transfer agent at 800-568-3476. We will promptly deliver the proxy materials to you upon receipt of your request. If you own your shares in “street name,” please contact your broker, bank, trustee or other intermediary to make your request.
If you receive more than one proxy card/voting instruction form, your shares probably are registered in more than one account or you may hold shares both as a registered shareholder and through one of the Savings Plans. You should vote each proxy card/voting instruction form you receive.
2023 PROXY STATEMENT | 90 |
Back to Contents | |
Information Relating to Forward-Looking Statements
Certain statements included in this Proxy Statement are “forward-looking statements” within the meaning of the United States federal securities laws. All statements other than historical factual information are forward-looking statements, including without limitation statements regarding strategic plans and plans for growth, innovation and future operations; financial or operating targets or projections; projected cost savings; future capital allocation, acquisitions and the integration thereof; plans and strategies relating to corporate governance, executive compensation and corporate social responsibility; the goals, objectives and anticipated benefits of our executive compensation program; the tax impact of executive or equity compensation; the effect of an event of termination orchange-of-control; risk assessments and risk mitigation efforts; anticipated commercial activity; anticipated benefits of certain related person transactions; general economic and capital markets conditions; the timing of any of the foregoing; assumptions underlying any of the foregoing; and any other statements that address events or developments that Danaher intends or believes will or may occur in the future. Terminology such as “believe,” “anticipate,” “should,” “could,” “intend,” “will,” “plan,” “expect,” “estimate,” “project,” “target,” “may,” “possible,” “potential,” “forecast” and “positioned” and similar references to future periods are intended to identify forward-looking statements, although not all forward-looking statements are accompanied by such words. Forward-looking statements are based on assumptions and assessments made by our management in light of their experience and perceptions of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties, including but not limited to the risks and uncertainties set forth under “Item 1A. Risk Factors” in our Annual Report on Form10-K for the year ended December 31, 2017.
Certain statements included in this Proxy Statement are “forward-looking statements” within the meaning of the United States federal securities laws. All statements other than historical factual information are forward-looking statements, including without limitation statements regarding strategic plans and plans for growth, innovation and future operations; financial or operating targets or projections; future capital allocation, acquisitions and the integration thereof; plans and strategies relating to corporate governance, executive compensation, director compensation and sustainability; the goals, objectives and anticipated benefits of our executive compensation and director compensation programs (including Company and individual performance goals and targets); the tax impact of executive or equity compensation; political contributions; the effect of an event of termination or change-of-control; Board oversight of strategy and risk; risk mitigation efforts; the expected roles and responsibilities of the Board’s committees; plans with respect to shareholder engagement and alignment, Board recruitment, selection and refreshment; the Board’s intention to increase the percentage of gender-diverse directors on the Board to at or greater than 30%; the anticipated benefits to the Company of particular director skills and attributes; anticipated commercial activity; anticipated benefits of certain related person transactions; general economic and capital markets conditions; the timing of any of the foregoing; assumptions underlying any of the foregoing; and any other statements that address events or developments that Danaher intends or believes will or may occur in the future. Terminology such as “believe,” “anticipate,” “should,” “could,” “intend,” “will,” “plan,” “expect,” “estimate,” “project,” “target,” “may,” “possible,” “potential,” “forecast” and “positioned” and similar references to future periods are intended to identify forward-looking statements, although not all forward-looking statements are accompanied by such words. Forward-looking statements are based on assumptions and assessments made by our management in light of their experience and perceptions of historical trends, current conditions, expected future developments and other factors they believe to be appropriate. These forward-looking statements are subject to a number of risks and uncertainties, including but not limited to the risks and uncertainties set forth under “Item 1A. Risk Factors” in the accompanying Annual Report on Form 10-K for the year ended December 31, 2022. Forward-looking statements are not guarantees of future performance and actual results may differ materially from the results, developments and business decisions contemplated by our forward-looking statements. Accordingly, you should not place undue reliance on any such forward-looking statements. Forward-looking statements included in this Proxy Statement speak only as of the date of this Proxy Statement. Except to the extent required by applicable law, we do not assume any obligation to update or revise any forward-looking statement, whether as a result of new information, future events and developments or otherwise.
Website Disclosure
We may provide disclosure in the “Investor – Corporate Governance” section of our corporate website, http://www.danaher.com, of any of the following: (1) the identity of the presiding director at meetings ofnon-management or independent directors, or the method of selecting the presiding director if such director changes from meeting to meeting; (2) the method for interested parties to communicate directly with the Board or with individual directors, the Lead Independent Director or thenon-management or independent directors as a group; (3) the identity of any member of Danaher’s Audit Committee who also serves on the audit committees of more than three public companies and a determination by the Board that such simultaneous service will not impair the ability of such member to effectively serve on Danaher’s Audit Committee; and (4) contributions by Danaher to a tax exempt organization in which anynon-management or independent director serves as an executive officer if, within the preceding three years, contributions in any single fiscal year exceeded the greater of $1 million or 2% of such tax exempt organization’s consolidated gross revenues. We also intend to disclose any amendment to the Standards of Conduct that relates to any element of the code of ethics definition enumerated in Item 406(b) of RegulationS-K under the Securities Exchange Act, and any waiver from a provision of the Standards of Conduct granted to any of our directors, principal executive officer, principal financial officer, principal accounting officer, or any other executive officer, in the “Investor – Corporate Governance” section of our corporate website, http://www.danaher.com, within four business days following the date of such amendment or waiver.
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 thenon-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 thenon-management or independent directors, as applicable, c/o Corporate Secretary, Danaher Corporation, 2200 Pennsylvania Avenue, N.W., Suite 800W, Washington, D.C. 20037-1701.
Section 16(a) Beneficial Ownership Reporting Compliance
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 andgreater-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, 2017, all Section 16(a) filing requirements applicable to our officers, directors andgreater-than-10% shareholders were satisfied except that due to the Company’s
We may provide disclosure in the “Investor – Corporate Governance” section of our corporate website, http://www.danaher.com, of any of the following: (1) the identity of the presiding director at meetings of non-management or independent directors, or the method of selecting the presiding director if such director changes from meeting to meeting; (2) the method for interested parties to communicate directly with the Board or with individual directors, the Lead Independent Director or the non-management or independent directors as a group; (3) the identity of any member of Danaher’s Audit Committee who also serves on the audit committees of more than three public companies and a determination by the Board that such simultaneous service will not impair the ability of such member to effectively serve on Danaher’s Audit Committee; and (4) contributions by Danaher to a tax exempt organization in which any non-management or independent director serves as an executive officer if, within the preceding three years, contributions in any single fiscal year exceeded the greater of $1 million or 2% of such tax exempt organization’s consolidated gross revenues. We also intend to disclose any amendment to the Code of Conduct that relates to any element of the code of ethics definition enumerated in Item 406(b) of Regulation S-K under the Exchange Act, and any waiver from a provision of the Code of Conduct granted to any of our directors, principal executive officer, principal financial officer, principal accounting officer, or any other executive officer, in the “Investor – Corporate Governance” section of our corporate website, http://www.danaher.com, within four business days following the date of such amendment or waiver.
Information contained on or connected to any of the websites referenced in this Proxy Statement is not incorporated by reference into this Proxy Statement and should not be considered a part of this Proxy Statement or any other filing that we make with the U.S. Securities and Exchange Commission.
2023 PROXY STATEMENT | 91 |
Back to Contents | ||
|
administrative error, Brian W. Ellis failed to report on a Form 4 the award of certain performance-based RSUs, which filing requirement was triggered by the Compensation Committee’s certification of the satisfaction of the award’s performance criteria. Mr. Ellis’ award was subsequently reported on a Form 4.
Annual Report on Form10-K for 2017
Danaher will provide, without charge, a copy of the Danaher Annual Report on Form10-K for 2017 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 2019 Annual Meeting
A shareholder who wishes to include a proposal in Danaher’s proxy statement for the 2019 Annual Meeting of shareholders pursuant to Rule14a-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 28, 2018 in order to be considered for inclusion.
In order to be properly brought before the 2019 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 29, 2018 and no later than November 28, 2018. If the date of the 2019 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 2019 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 2019 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 28, 2018 and no later than January 27, 2019. If the date of the 2019 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
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.
Section 16(a) of the 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, 2022, all Section 16(a) filing requirements applicable to our officers, directors and greater-than-10% shareholders were satisfied, except that (1) Christopher Bouda failed to file on a timely basis sixteen Form 4s (each pertaining to a bi-weekly salary deferral into the Danaher stock fund in Danaher’s deferred compensation program), and (2) Jennifer Honeycutt failed to file on a timely basis one Form 4 relating to one transaction involving the sale of shares of Danaher common stock. All such transactions were subsequently reported on Form 4s.
Danaher will provide, without charge, a copy of the Danaher Annual Report on Form 10-K for 2022 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.
A shareholder who wishes to include a proposal in Danaher’s proxy statement for the 2024 Annual Meeting of shareholders pursuant to Rule 14a-8 under the 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 29, 2023 in order to be considered for inclusion.
In order to be properly brought before the 2024 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 30, 2023 and no later than November 29, 2023. If the date of the 2024 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 2024 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, including providing the information required by Rule 14a-19. If a shareholder fails to provide timely notice of a proposal to be presented at the 2024 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 29, 2023 and no later than January 28, 2024. If the date of the 2024 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
APPENDIX ARECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURESAs described in more detail in the Compensation Discussion and Analysis section of the Company’s 2023 Proxy Statement, the 2022 annual cash incentive awards paid to the Company’s named executive officers were based in part on the Company’s 2022 performance with respect to three metrics, Adjusted EPS, Free Cash Flow Ratio and Core Revenue Growth. Each of these metrics is a non-GAAP financial measure. Set forth below are reconciliations of each of these metrics to the comparable GAAP financial measure, based on the Company’s actual 2022 performance. RECONCILIATION OF 2022 ADJUSTED DILUTED EARNINGS PER SHARE (ADJUSTED EPS)
RECONCILIATION OF 2022 ADJUSTED FREE CASH FLOW TO ADJUSTED NET INCOME RATIO (FREE CASH FLOW RATIO)
RECONCILIATION OF 2022 CORE REVENUE GROWTH
|
Back to Contents | ||||