American Express regularly engages with shareholders and other stakeholders on a year-round basis. We greatly value the insights of our shareholders and seek to engage in meaningful dialogue by soliciting input on topics of interest for discussion, researching shareholder voting policies and historical voting records and providing materials about the Company prior to our engagement meetings. We share feedback received from our engagement meetings with our Board and its committees for further assessment and to determine appropriate responses. From a governance perspective, our Corporate Secretary and Chief Governance Officer engages in outreach throughout the year to discuss with our shareholders and other stakeholders the issues that are important to them, listen to their expectations for the Company and share our views. Our Investor Relations team also regularly meets with shareholders, prospective investors and investment analysts. Our Board and Management recognize the benefits that come from meaningful dialogue with shareholders and other stakeholders and we have a longstanding practice of active engagement. In summary, we have embraced an active shareholder engagement strategy for many years. We engage with shareholders throughout the year in order to: | ✓ | ¾Provide visibility and transparency into our business, our performance and our corporate governance, ESG and compensation practices | ✓ | practices; ¾Discuss with our shareholders the issues that are important to them, hear their expectations for us and share our views | ✓ | views; and ¾Assess emerging issues that may affect our business, inform our decision making, enhance our corporate disclosures and help shape our practicespractices. |
Since January 2017,Our 2023 Say-on-Pay Vote and Our Response
Following our 2023 Annual Meeting, we have engagedreached out to our top 50 shareholders along with investorscertain others among our top 75 shareholders, representing over 51 percentin the aggregate approximately 59% of our outstanding shares, along with other stakeholders to discuss our Say-on-Pay vote and other matters of interest to them, including Company strategy and performance, Board composition and succession planning and ESG-related matters. Twenty-six of our shareholders, representing approximately 40% of our outstanding on corporate governance,shares and other stakeholders responded to our meeting request. We also met with shareholders who proactively requested to meet. During these meetings, we specifically sought input from shareholders and other stakeholders regarding our 2023 Say-on-Pay vote and particular enhancements we could make to improve our disclosures regarding our executive compensation programs. In these meetings, several shareholders expressed concerns with the structure and related matters. This includes over 29 engagement meetings.quantum of the special award granted to our Chairman and CEO in 2022 and suggested opportunities to enhance our compensation-related disclosure. We also took the opportunity during these meetings to provide our shareholders with an overview of Management’s plans to respond to the 2023 Say-on-Pay vote, including the creation of a cross-functional group to review shareholder feedback and identify recommendations for the Compensation and Benefits Committee and the Board to assess. 
• 30 2024 PROXY STATEMENT Please see “2023 Shareholder Engagement and Responsiveness to 2023 Say-on-Pay Vote” starting on page 53, for a detailed discussion of our response to this shareholder feedback. 
2024 PROXY STATEMENT 31 • | 30 | 2018 Proxy Statement | | | Key features of our shareholder engagement include year-round outreach; meaningful engagement; regular reporting of shareholder input to Management and the Board; and shareholder-driven improvements. The below table provides a snapshot of our ongoing engagement process and outcomes. |
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Corporate Governance at American Express2018 Proxy Statement
How We Engage
INVESTOR RELATIONS AND
SENIOR MANAGEMENT
Board Involvement Our Lead Independent Director who also serves as our Compensation and Benefits Committee Chair is available for engagement and represents the Board in communications with shareholders, including participating in joint corporate governance and investor relations meetings. We provide institutional investors with many opportunities to providedeliver detailed feedback to our Board regarding shareholder meetings. | | | | Actions Taken by the Board Following Shareholder Engagement Shareholder feedback is delivered to our Board and senior management.thoughtfully considered and has led to modifications in our executive compensation programs, governance practices and disclosure. Some of the actions we have taken that are informed by shareholder feedback over the last several years include:  Modified our perquisites policy to eliminate a cash perquisite allowance paid to NEOs
Continued to align compensation program with the Company’s strategic priorities Backed our front-line colleagues by moving from a discretionary profit sharing contribution in the U.S. retirement plan to a fixed rate contribution Continued to release our ESG report (available on our website), which includes our full EEO-1 data, diversity metrics and discusses our ESG Strategy Roadmap focused on three core pillars: building financial confidence, advancing climate solutions and promoting DE&I, each with long-term goals and initiatives In 2021 and 2022, released DE&I reports (available on our website), which included recruitment, retention and promotion data, documented our progress on DE&I commitments and initiatives and detailed the diversity representation of colleagues. Such DE&I data continues to be included in our ESG reports Achieved 100% pay equity for colleagues across genders globally and across races and ethnicities in the U.S. and enhanced transparency on equal pay with the disclosure of our “raw median pay gap” Adopted proxy access Adopted shareholder right to call special meetings Simplified our Annual Incentive Award program to be more formulaic and based on a single Company scorecard Committed to not provide office support to future retiring CEOs Continued to evolve and enhance our proxy disclosures Amended our Corporate Governance Principles to limit the number of public company boards on which our directors may serve Added directors with financial services, payments, cybersecurity and digital backgrounds In 2021, we committed to net-zero emissions in alignment with the Science Based Targets initiative (SBTi). In December 2022, we submitted near- and long-term emissions reduction targets to the SBTi for validation. We participate in: ✓Formal events
✓One-on-one meetings
✓Group meetingscontinue to engage with SBTi throughout the year
validation process Please see “2023 Shareholder Engagement and Responsiveness to 2023 Say-on-Pay Vote” on page 53 for the actions taken in response to our 2023 Say-on-Pay vote | Investor Relations and
Senior Management We interact with our investors in a variety of ways. Our Investor Relations team regularly meets with shareholders, prospective investors and investment analysts at conferences, one-on-one meetings and group meetings. These meetings often include participation by Management, including our Chairman and CEO, CFO and other business leaders, and often focus on Company performance and business strategy. In 2023, Management and our Investor Relations team met with 229 investment firms, analysts and other investors, which included shareholders representing approximately 51% of our shares outstanding. To learn more about our engagement, you may visit our investor relationsInvestor Relations website at http://ir.americanexpress.com.ir.americanexpress.com. | | CORPORATE SECRETARY AND CHIEF
GOVERNANCE OFFICER
| Corporate Secretary’s Office We engage with governance representatives of our major shareholders through in-person meetings and conference calls that occur during and outside of the proxy season. Members of the corporate governance, investor relations and executive compensation groups discuss, among other matters, companyCompany performance, emerging governance practices generally and specifically with respect to our Company, the reasons behind a shareholder’s voting decisions at prior annual shareholder meetings, our executive compensation practices and our corporate social responsibility practices.ESG strategy and framework. | | | BOARD INVOLVEMENT
We make our Lead Independent Director and Compensation Committee Chair available for engagement with large shareholders, including participating in joint corporate governance and investor relations meetings. We deliver feedback to our Board regarding shareholder meetings.
| | | | | | | | | | | | | | | |  | | | |
OUTCOMES FROM CORPORATE GOVERNANCE ENGAGEMENT | Shareholder feedback is thoughtfully considered and has led to modifications in our governance practices, executive compensation program and disclosures. Some of the actions we have taken in response to shareholder feedback over the last several years include: |
✓ | Set new CEO pay target at $16.2 million, reduced from $22 million for prior long-tenured CEO | ✓ | Changed the CEO PG grant to payout in RSUs instead of cash | ✓ | Enhanced disclosure of annual incentive structure and assessments, including presenting business unit and individual scorecards | ✓ | Continue to align compensation program with new CEO strategic priorities | ✓ | Adopted proxy access | ✓ | Adopted shareholder right to call special meetings | ✓ | Added performance vesting criteria to our annual restricted stock unit grant | ✓ | Required our CEO to retain a portion of shares granted until after retirement | ✓ | Made changes to our executive compensation peer group | ✓ | Enhanced the process our CBC uses to determine CEO compensation and clarified the CEO’s target and maximum incentive opportunities | ✓ | Enhanced our website disclosures on political contributions and diversity | ✓ | Continue to enhance our proxy disclosures | ✓ | Amended our Corporate Governance Principles to limit the number of public company boards on which our directors may serve | ✓ | Designed our 2017 Incentive Compensation Plan to reflect evolving shareholder preferences | ✓ | Updated our Corporate Social Responsibility (CSR) Report and included it on our website | ✓ | Added directors with financial services, cybersecurity and digital backgrounds |
The following page provides additional details regarding our ongoing engagement process.
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2018 Proxy Statement Corporate Governance at American Express• 32 2024 PROXY STATEMENT
Corporate Governance Engagement Cycle
How to Communicate with ourOur Board You may communicate with the Board or an individual director by letter email or telephone,email, directed in care of the Company’s Corporate Secretary and Chief Governance Officer, who will forward your communication to the intended recipient. However, at the discretion of the Corporate Secretary and Chief Governance Officer, materials considered to be inappropriate or harassing, unsolicited advertisements or promotional materials and invitations to conferences or promotional material may not be forwarded. If you wish to communicate a concernhave an inquiry about our financial statements, accounting practices or internal controls, please direct your concern to the Chair of the Audit and Compliance Committee. If the concerninquiry relates to our governance practices, business ethics or corporate conduct, it should be directed to the Chair of the Nominating, Governance and GovernancePublic Responsibility Committee or the Lead Independent Director. Matters relating to executive compensation may be directed to the Chair of the Compensation and Benefits Committee. If you are unsure of the category to which your concern relates, you may communicate it to any one of the independent directors, to the Lead Independent Director or to the Chairman. Please direct such communications in care of the Corporate Secretary and Chief Governance Officer as follows: TANGELA S. RICHTERKristina V. Fink
Corporate Secretary and Chief Governance Officer
American Express Company
200 Vesey Street
New York, NY 10285
(212) 640-2000
corporatesecretarysoffice@aexp.com
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Corporate Governance at American Express2018 Proxy Statement2024 PROXY STATEMENT 33 •
Board Committees
Effective March 13, 2018 our Board approved several revisions to the leadership and membership of our standing committees. The current standing committee membership information is listed below. Standing committee membership for 2017 can be found in our 2017 proxy statement filed with the SEC on March 20, 2017. Each member of our standing committees in 2017, including our retiring directors, Mr. Walter and Ms. Burns, was independent and fulfilled the requirements applicable to each committee on which they served.
Board Committee Responsibilities
Audit and Compliance Committee | | 12MEETINGS
in 2017
| DANIEL L. VASELLA(Chair)
| | Members
John J. Brennan
Ralph de la Vega
Anne L. Lauvergeon
Michael O. Leavitt
Daniel L. Vasella (Chair)
| Independence
Each member of the committee is independent and financially literate.
Audit Committee Financial Expert
Mr. Brennan meets the requirements as defined by SEC rules.
|
| Role and Responsibilities
●Assists the Board in its oversight of the integrity of our consolidated financial statements and related financial reporting processes, and internal and external auditing, including the qualifications and the independence of the independent registered public accounting firm, the performance of the Company’s internal audit services function, the integrity of our systems of internal control over financial reporting, and legal and regulatory compliance. Seepage 48 under Report of the Audit and Compliance Committee for additional information regarding the duties of the Committee with respect to oversight of our financial reporting process●Appoints, replaces, reviews and evaluates the qualifications of the Company’s independent registered public accounting firm
●Oversees the process for the receipt, retention and treatment, on a confidential basis, of complaints we receive regarding accounting, internal accounting controls or auditing matters and the confidential, anonymous submission by our employees of concerns regarding questionable accounting or auditing matters
●Reviews and discusses reports from management regarding significant reported ethics violations under our code of conduct and other corporate governance policies
●Meets regularly in executive session with management, including with the Company’s Chief Compliance & Ethics Officer, the Company’s Chief Audit Executive and the Company’s independent registered public accounting firm
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2018 Proxy Statement Corporate Governance at American Express
Compensation and Benefits Committee | | 4 MEETINGS
in 2017
| RONALD A.WILLIAMS(Chair)
| | Members
John J. Brennan
Peter Chernin
Ralph de la Vega
Samuel J. Palmisano
Ronald A. Williams (Chair)
| Independence
Each member of the committee is independent.
|
| Role and Responsibilities
●Oversees the compensation of our executive officers and designated key employees
●Oversees our employee compensation plans and arrangements and employee benefit plans
●Approves an overall compensation philosophy and strategy for the Company and its executive officers, including the selection of performance measures aligned with our business strategy, and the review of our compensation practices so that they do not encourage imprudent risk taking
●Evaluates potential conflicts of interest with respect to its advisors
●The committee may delegate certain of its responsibilities to one or more of its members or to executive officers or designated senior executives, to the extent permissible under its charter, the Company’s bylaws, the terms of the applicable plans, laws, rules, regulations and listing standards, and subject to any limitations imposed by our Board from time to time.
Compensation and Benefits Committee Interlocks and Insider Participation
Neither any current member of the committee nor any person who served as a member of the committee during the last fiscal year is a former or current officer or employee of the Company or any of its subsidiaries. Neither any current member of the committee nor any person who served as a member of the committee during the last fiscal year has any relationship required to be disclosed under this caption under the rules of the SEC.
|
Innovation and Technology Committee | | 4 MEETINGS
in 2017
| CHARLENE BARSHEFSKY
(Chair)
| | Members
Charlene Barshefsky (Chair)
Ralph de la Vega
Theodore J. Leonsis
Christopher D. Young
| Independence
Each member of the committee is independent.
|
| Role and Responsibilities
●Assists the Board in its oversight of strategic innovation and technology initiatives
●Facilitates the Board’s review, discussion and understanding of our digital and technology strategy, our transformation initiatives and our digital product innovations
●Reviews metrics on innovation and digital and technology developments and technology progress
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Corporate Governance at American Express2018 Proxy Statement
Nominating and Governance Committee | | 5 MEETINGS
in 2017
| PETER CHERNIN(Chair)
| | Members
Peter Chernin (Chair)
Theodore J. Leonsis
Samuel J. Palmisano
Daniel L. Vasella
Ronald A. Williams
| Independence
Each member of the committee is independent.
|
| Role and Responsibilities
●Considers and recommends candidates for election to the Board
●Provides oversight of corporate governance matters at the Company consistent with the long-term best interests of the Company and its shareholders
●Advises the Board on director compensation
●Oversees the annual performance evaluation process for the Board and Board committees
●Advises the Board on corporate governance and Board leadership
●Discusses feedback from shareholders regarding governance practices and advises on shareholder engagement practices
●Administers the Related Person Transaction Policy
●Supports the Board with respect to management succession planning
|
Public Responsibility Committee | | 3 MEETINGS
in 2017
| MICHAEL O. LEAVITT(Chair)
| | Members
Charlene Barshefsky
Anne L. Lauvergeon
Michael O. Leavitt (Chair)
Theodore J. Leonsis
Richard C. Levin
| Independence
Each member of the committee is independent.
|
| Role and Responsibilities
●Reviews legislation, regulations and policies affecting us, our philanthropic programs, our political action committee, our corporate political contributions and our government relations activities
●Reviews legislation, regulations and policies affecting the communities we serve and our environmental and social programs and practices
Political Engagement Activities
We communicate with policymakers on public policy issues important to the Company. In addition to our advocacy efforts, we participate in the political process through the American Express Political Action Committee (AXP PAC) and through corporate political contributions in those jurisdictions where it is permissible to do so. AXP PAC is funded solely by voluntary employee contributions and does not contribute to presidential campaigns. We maintain comprehensive compliance procedures to ensure that our activities are conducted in accordance with all relevant laws, and management regularly reports to the committee regarding its engagement in the public policy arena and its political contributions. Information regarding our Company’s political activities, including U.S. political contributions, may be found at http://about.americanexpress.com/news/pap.aspx.
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2018 Proxy Statement Corporate Governance at American Express
Risk Committee | | 8 MEETINGS
in 2017
| JOHN J. BRENNAN(Chair)
| | Members
Charlene Barshefsky
John J. Brennan (Chair)
Richard C. Levin
Daniel L. Vasella
Christopher D. Young
| Independence
Each member of the committee is independent.
|
| Role and Responsibilities
●Assists the Board in its oversight of the Company’s enterprise-wide risk management framework and roles and responsibilities of the three lines of defense, and other risk management policies and procedures established by management to identify, assess, measure and manage key risks facing the Company
●Assists the Board in its oversight of management’s execution of capital management, liquidity planning and resolution planning
●Meets regularly in executive session with the Company’s Chief Risk Officer
Please see How our Board Oversees Risk Management onpage 24 for additional information regarding the activities of the committee.
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Corporate Governance at American Express 2018 Proxy Statement
Compensation of Directors The Nominating, Governance and GovernancePublic Responsibility Committee reviews director compensation and seeks to compensate our directors in a manner that attracts and retains highly qualified directors and aligns the interests of our directors with those of our long-term shareholders. No changes were madeIn 2023, the Committee engaged an independent compensation advisory firm, Semler Brossy, to assist the committee in its review of the competitiveness and structure of the Company’s non-managementnon-Management director compensation. This review included a competitive benchmarking of our director compensation against the 20 companies that our Compensation and Benefits Committee reviews as a reference when examining the competitiveness of our executive compensation practices, as well as the Dow 30 and certain financial institutions. After completing its review, the Nominating, Governance and Public Responsibility Committee recommended no increases to our non-Management director compensation program in 2017.2023. The following table provides information on the 20172023 compensation of non-managementnon-Management directors who served for all or a part of 2017.2023. We reimburse directors for reasonable out-of-pocket expenses attendant to their board service. | Name | | Fees Earned or
Paid in Cash
(1) | | Stock
Awards
(2) | | All Other
Compensation
(3) | | Total | | Charlene Barshefsky | | $ | 115,000 | | $ | 165,000 | | $ | 77,082 | | $ | 357,082 | | John Brennan | | $ | 135,000 | | $ | 165,000 | | $ | 2,296 | | $ | 302,296 | | Ursula M. Burns | | $ | 125,000 | | $ | 165,000 | | $ | 88,372 | | $ | 378,372 | | Peter Chernin | | $ | 130,000 | | $ | 165,000 | | $ | 46,672 | | $ | 341,672 | | Ralph de la Vega | | $ | 120,000 | | $ | 165,000 | | $ | 6,167 | | $ | 291,167 | | Anne L. Lauvergeon | | $ | 120,000 | | $ | 165,000 | | $ | 20,584 | | $ | 305,584 | | Michael O. Leavitt | | $ | 120,000 | | $ | 165,000 | | $ | 17,597 | | $ | 302,597 | | Theodore J. Leonsis | | $ | 115,000 | | $ | 165,000 | | $ | 30,779 | | $ | 310,779 | | Richard C. Levin | | $ | 120,000 | | $ | 165,000 | | $ | 49,387 | | $ | 334,387 | | Samuel J. Palmisano | | $ | 110,000 | | $ | 165,000 | | $ | 16,796 | | $ | 291,796 | | Daniel L. Vasella | | $ | 160,000 | | $ | 165,000 | | $ | 26,294 | | $ | 351,294 | | Robert D. Walter | | $ | 156,250 | | $ | 165,000 | | $ | 68,158 | | $ | 389,408 | | Ronald A. Williams | | $ | 155,000 | | $ | 165,000 | | $ | 83,665 | | $ | 403,665 |
| | | | | | | | | | | | | | | | | | | | | | | | | | Name | | Fees Earned or
Paid in Cash(1) | | Stock
Awards(2) | | All Other
Compensation(3) | | Total | | | | | | Thomas J. Baltimore | | | $ | 130,000 | | | | $ | 220,000 | | | | $ | 57,381 | | | | $ | 407,381 | | | | | | | Charlene Barshefsky (4) | | | $ | 40,893 | | | | $ | — | | | | $ | 82,282 | | | | $ | 123,175 | | | | | | | John J. Brennan | | | $ | 185,000 | | | | $ | 295,000 | | | | $ | 51,189 | | | | $ | 531,189 | | | | | | | Peter Chernin | | | $ | 155,000 | | | | $ | 220,000 | | | | $ | 114,294 | | | | $ | 489,294 | | | | | | | Walter J. Clayton III | | | $ | 126,334 | | | | $ | 220,000 | | | | $ | 10,764 | | | | $ | 357,098 | | | | | | | Ralph de la Vega | | | $ | 165,000 | | | | $ | 220,000 | | | | $ | 46,268 | | | | $ | 431,268 | | | | | | | Michael O. Leavitt(4) | | | $ | 43,684 | | | | $ | — | | | | $ | 73,568 | | | | $ | 117,252 | | | | | | | Theodore J. Leonsis | | | $ | 140,000 | | | | $ | 220,000 | | | | $ | 96,559 | | | | $ | 456,559 | | | | | | | Deborah P. Majoras | | | $ | 122,250 | | | | $ | 220,000 | | | | $ | 2,081 | | | | $ | 344,331 | | | | | | | Karen L. Parkhill | | | $ | 170,000 | | | | $ | 220,000 | | | | $ | 20,322 | | | | $ | 410,322 | | | | | | | Charles E. Phillips | | | $ | 130,000 | | | | $ | 220,000 | | | | $ | 12,338 | | | | $ | 362,338 | | | | | | | Lynn A. Pike | | | $ | 125,000 | | | | $ | 220,000 | | | | $ | 258,322 | | | | $ | 603,322 | | | | | | | Daniel L. Vasella | | | $ | 140,000 | | | | $ | 220,000 | | | | $ | 93,955 | | | | $ | 453,955 | | | | | | | Lisa W. Wardell | | | $ | 130,000 | | | | $ | 220,000 | | | | $ | 11,859 | | | | $ | 361,859 | | | | | | | Christopher D. Young | | | $ | 145,000 | | | | $ | 220,000 | | | | $ | 35,182 | | | | $ | 400,182 | |
| (1) | Annual Retainers.For service in 2017,2023, we paid non-managementnon-Management directors an annual retainer of $95,000$110,000 for board service andservice. We paid an additional annual retainer of $20,000 to members of the Audit and Compliance and Risk Committees, $10,000$15,000 to members of the CBCCompensation and $5,000 to members of the InnovationBenefits Committee and Technology, Nominating, and Governance and Public Responsibility Committees.Committee. We also paid an annual retainer to the Chair of each of the Board committees as follows: Audit and Compliance and Risk, $20,000; and Compensation and Benefits and Nominating, and Governance and Risk, $20,000; Innovation and Technology and Public Responsibility, $10,000.$15,000. We pay no fees for attending meetings, but the annual retainer for board service of $95,000$110,000 is reduced by $20,000 if a director does not attend at least 75 percent75% of his or her aggregate boardBoard and committee meetings. OurIn addition, our Lead Independent Director for 2017, Robert D. Walterduring 2023, John Brennan, received an annual retainer of $25,000.$100,000 of which $25,000 is paid in cash and included in this column and the remaining $75,000 is credited to the director’s share equivalent unit (SEU) account (see footnote 2). |
| All non-managementnon-Management directors, except Charlene Barshefsky, Theodore J. Leonsis, Karen L. Parkhill and Lynn A. Pike, deferred all or a portion of their 20172023 retainers into a cash account, a share equivalent unit (SEU)SEU account, or both, under the deferred compensation plan described below in footnote 2. |
| (2) | Share Equivalent Unit Plan.To align our non-managementnon-Management directors’ annual compensation with shareholder interests, each non-managementnon-Management director is credited with common SEUs upon election or reelection at each annual meeting of shareholders. Each SEU reflects the value of one common share. | | Directors receive additional SEUs as dividend equivalents on the units in their accounts. SEUs do not carry voting rights and must be held at least until a director ends his or her service on the Board. Each SEU is payable in cash equal to the then valuethen-value of one common share at the time of distribution to the director. On May 1, 2017,2, 2023, the date of last year’s annual meeting,Annual Meeting, each non-managementnon-Management director elected to the Board was credited with SEUs having a value of $165,000,$220,000, which consisted of 2,1091,365 SEUs, based on the market price of our common shares for the average of the 15 trading days immediately preceding such date. In addition, our Lead Independent Director during 2023, John J. Brennan, received an annual SEU retainer of $75,000, which consisted of 450 SEUs based on the market price of our common shares for the average of the last 15 trading days of each calendar quarter. We report in this column the aggregate grant date fair value of these SEUs in accordance with FASB ASC Topic 718, Compensation – Compensation—Stock Compensation. |
• 34 2024 PROXY STATEMENT | Deferred Compensation Plan for Directors.Non-management Non-Management directors may defer the receipt of up to 100 percent100% of their annual cash retainer fees into either: (1) a cash account in which amounts deferred will be credited at the rate of 120 percent120% of the applicable federal long-term rate for December of the prior year, or (2) their SEU account. Under either alternative, directorsDirectors will receive cash payments and will not receive shares upon payout of their deferrals. |
| The balances in directors’ SEU accounts atas of December 31, 20172023, are set forth in the table below. These amounts represent the aggregate number of SEUs granted under the SEU Plan for all years of service as a director and additional units credited as a resultbecause of the reinvestment of dividend equivalents and, for directors who participated in the SEU option under our deferred compensation plan for directors, retainer amounts deferred into their SEU account and dividend equivalents thereon. |
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2018 Proxy Statement Corporate Governance at American Express
| Name | Number of
SEUs | | | C. Barshefsky60,399 | Thomas J. Baltimore | | | | 6,351 | | | | Charlene Barshefsky | | | | — | | | | John J. Brennan | 3,693 | | | 23,851 | | | | U.M. Burns69,956 | Peter Chernin | P. Chernin | 36,964 | | 50,358 | | | | Walter J. Clayton III | R. | | | 2,308 | | | | Ralph de la Vega | 6,162 | | | 20,766 | | | | A.L. Lauvergeon17,683 | Michael O. Leavitt | M.O. Leavitt | 11,528 | | — | | | | T.J. Leonsis25,505 | Theodore J. Leonsis | R.C. Levin | 32,892 | | 39,163 | | | | S.J. Palmisano13,941 | Deborah P. Majoras | D.L. Vasella | 22,357 | | 1,769 | | | | R.D. Walter53,522 | Karen L. Parkhill | R.A. Williams | 60,351 | | 6,434 | | | | Charles E. Phillips | | | | 6,478 | | | | Lynn A. Pike | | | | 6,434 | | | | Daniel L. Vasella | | | | 42,019 | | | | Lisa W. Wardell | | | | 6,270 | | | | Christopher D. Young | | | | 16,470 | |
| (3) | Insurance.Insurance. We provide our non-managementnon-Management directors with group term life insurance coverage of $50,000. The group life insurance policy is provided to the directors on a basis generally available to all companyCompany employees. This column includes the premium paid for such coverage.
|
| Dividend Equivalents.Dividend equivalents are reinvested in additional units for all directors based upon total SEUs held at the time of companyshareholder record dates applicable to Company quarterly dividend payment dates.payment. This column includes the fair market value of the dividend equivalents received by the directors during 20172023 in these amounts: Mr. Baltimore $11,994, Amb. Barshefsky $77,035,$82,260, Mr. Brennan $2,250, Ms. Burns $88,326,$51,137, Mr. Chernin $46,626,$114,242, Mr. Clayton $2,713, Mr. de laLa Vega $6,121, Ms. Lauvergeon $20,538,$46,217, Gov. Leavitt $12,551,$28,172, Mr. Leonsis $30,733,$88,508, Ms. Majoras $2,030, Ms. Parkhill $13,270, Mr. Levin $41,341, Mr. Palmisano $16,750,Phillips $12,287, Ms. Pike $13,270, Dr. Vasella $26,248, Mr. Walter $68,112,$93,904, Ms. Wardell $11,807, and Mr. Williams $75,619.Young $35,131. |
| Directors’ Charitable Award Program.We maintain a Directors’ Charitable Award Program for directors elected prior to July 1, 2004. To fund this program, we purchased joint life insurance on the lives of participating directors, including Mr. Chenault. The death benefit of $500,000 funds a donation to a charitable organization that the director recommends. The Company paid no premiums in 2017.
| | Matching Gift Program.Directors are eligible to participate in the Company’s Matching Gift Program on the same basis as Company employees. Under this program, the American Express Foundation matches gifts to approved charitable organizations up to $8,000 per calendar year. This column includes the amounts matched with respect to calendar year 2017.2023. |
| Special Events. In connection with their attendance and participation at The American Express 2023 Golf Tournament, Gov. Leavitt and Mr. Baltimore received a benefit equivalent to $45,375 and $43,135 respectively, which includes the Pro-Am Player entry fee and other costs associated with participation in the tournament. Mr. Baltimore also received a benefit equivalent to $2,200 for hospitality tickets in connection with his attendance at the U.S. Open Golf event. |
| Other Retainers. Ms. Pike is Chair of the Board of Directors of AENB, our U.S. bank subsidiary. For her service as a board member, Ms. Pike received an annual cash retainer totaling $245,000, which is included in this column. |
| (4) | Amb. Barshefsky and Gov. Leavitt retired from our Board effective May 2, 2023. |
2024 PROXY STATEMENT 35 • Director Stock Ownership Our Corporate Governance Principles provide that non-managementnon-Management directors are required to obtain a personal holding of shares (directly or through SEUs) with a value of $1 million within five years of joining the Board.
Table of Contents All non-Management directors have achieved or are on track to achieve this requirement during the required time period.
Corporate Governance at American Express 2018 Proxy Statement
Director and Officer Liability Insurance We have an insurance program in place to provide coverage for director and officer liability and for fiduciary liability arising from employee benefit plans we sponsor.liability. The coverage for director and officer liability provides that, subject to the policy terms and conditions, the insurers will: (i) reimburse us when we are legally permitted to indemnify our directors and officers; (ii) pay losses, including settlements, judgments and legal fees, on behalf of our directors and officers when we cannot indemnify them; and (iii) pay our losses resulting from certain securities claims. The fiduciary liabilityA portion of the program covers: us; our employee benefit plans; and the directors, trustees and employees who serve as fiduciaries for our employee benefit plans. Subject to the policy terms and conditions, it covers losses from alleged breaches of fiduciary or administrative duties, as defined in the Employee Retirement Income Security Act of 1974 or similar laws or regulations. A portion of theinsurance program is blended with certain other insurances covering the company. EffectiveCompany. The insurance program is effective from November 30, 20172023 to November 30, 2018, this insurance2024 and is provided by a consortium of insurers. ACE American Insurance Company is the lead insurer.and XL Specialty Insurance Company Illinois National Insurance Company, Allied World Assurance Company Ltd., Freedom Specialty Insurance Company, Continental Casualty Company, Everest National Insurance Company, American International Reinsurance Company Ltd., Markel Bermuda Ltd., Berkshire Hathaway Specialty Insurance Company, Starr Indemnity and Liability Company, and QBE Insurance Corporation provideare the lead insurers with various other insurers providing excess coverage. The program also includes supplemental layers dedicated exclusively to providing coverage for directors and officers when we cannot indemnify them. The supplemental layers are provided by XL Specialty Insurance Company, Zurich American Insurance Company, ACE American Insurance Company, Illinois National Insurance Company, Freedom Specialty Insurance Company, Continental Casualty Company, Everest National Insurance Company, U.S. Specialty Insurance Company, Travelers Casualty & Surety Company of America, Starr Indemnity and Liability Company, Allied World Assurance Company Ltd., American International Reinsurance Company Ltd., Chubb Bermuda Insurance Ltd., and certain Lloyd’s of London syndicates. We expect to obtain similar coverage upon expiration of the current insurance program. The annual premium for the insurance program is approximately $4.4$5.1 million.
Certain Relationships and Transactions In the ordinary course of our business, we engage in transactions, arrangements and relationships with many other entities, including financial institutions and professional organizations. Some of our directors, director nominees, executive officers, greater than five percent5% shareholders and their immediate family members (each, a Related Person) may be directors, officers, partners, employees or shareholders of these entities. We carry out transactions with these entities on customary terms and, in many instances, these Related Persons may not have knowledge of them. To the Company’s knowledge, since January 1, 2017,2023, no Related Person has had a material interest in any of our ongoing business transactions or relationships except as described below.in this section. Our Related Person Transaction Policy Our written Related Person Transaction Policy governs company transactions, arrangements and relationships involving more than $120,000 in which a Related Person has a direct or indirect material interest (Related Person Transactions). Under the policy, the Nominating, Governance and Public Responsibility Committee must provide prior review and oversight of, and approval or disapproval of, Related Person Transactions, must be approved by the Nominating and Governance Committee.other than certain pre-approved transactions (described below). The Committeecommittee will only approve a transaction if, after reviewing the relevant facts and circumstances, it determines that the transaction is consistent with the best interests of the Company. In the event we become aware of a Related Person Transaction that was not pre-approvedapproved under the policy, the Committeecommittee will consider the options available, including ratification, revision or termination of the transaction. The policy does not supersede any other company policy or procedure that may apply to any Related Person Transaction, including our Corporate Governance Principles and codes of conduct. The Company’s Corporate Secretary and Chief Governance Officer is responsible for assisting the Nominating, Governance and GovernancePublic Responsibility Committee in carrying out its responsibilities, and managementManagement is required to present to the Committeecommittee the material facts of any transaction that it believes may require review. In cases wherewhen it is impracticable or undesirable to delay a decision on a proposed transaction until the next meeting of the Nominating, Governance and Public Responsibility Committee, the Chair of the Committee may review and approve the transaction and then report any approval to the full Committeecommittee at its next regularly scheduled meeting. If a matter before the Nominating, Governance and Public Responsibility Committee involves a member of the Committee,committee, the member must be recusedrecuse themselves and may not participate in deliberations or vote on the matter. | 39
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2018 Proxy Statement Corporate Governance at American Express
Pre-Approved Categories of Related Person Transactions The Nominating, Governance and GovernancePublic Responsibility Committee has pre-approved the followingcertain categories of transactions as being consistent with the best interests of the Company. These categories, which may constituteexceed the proscribed threshold for Related Person Transactions, are:include but are not limited to, director and executive officer compensation, use of Company products and services, transactions involving indebtedness to the Company, certain banking-related transactions, certain ordinary course transactions, charitable contributions and indemnification payments. ● | Executive officer compensation arrangements approved by the Board or the Compensation and Benefits Committee;
| ● | Non-employee director compensation approved by the Board or the Nominating and Governance Committee;
| ● | Director and officer insurance payments and indemnification payments made in accordance with the Company’s charter or by-laws;
| ● | Transactions in the ordinary course of business with entities at which a Related Person is a director, executive officer, employee and/or a less than 10 percent beneficial owner, provided the amounts involved do not exceed the greater of $1 million or 1 percent of the other entity’s annual revenues;
| ● | Transactions in which the rates or charges are determined by competitive bids;
| ● | Contributions by the Company or the American Express Foundation to a charitable organization at which a Related Person serves as a director, executive officer and/or trustee, provided that the aggregate annual amount of such contributions, excluding contributions under the Company’s gift match program and contributions under the Company’s Directors’ Charitable Award Program, do not exceed the lesser of $1 million or two percent of the organization’s total annual revenues;
| ● | Use of the Company’s products and services on terms and conditions similar to those available to other customers or employees generally in similar circumstances or of like credit-worthiness; and
| ● | Transactions in which all shareholders receive the same benefits on a pro-rata basis.
|
• 36 2024 PROXY STATEMENT Related PartyPerson Transactions Our executive officers and directors may from time to time take out loans from certain of our subsidiaries on the same terms that these subsidiaries offer to the general public. For example, our two U.S. card-issuing banksbank subsidiary may extend credit to our directors and executive officers under our charge or lending products. All indebtedness from these transactions is in the ordinary course of our business and is on the same terms, including interest rates and collateral, in effect for comparable transactions with other people.people not related to the Company or its subsidiaries. Such indebtedness involves normal risks of collection and does not have features or terms that are unfavorable to our subsidiaries. Our executive officers and directors may also haveenter into transactions with us involving other goods and services, such as travel services and investments in deposit and checking products offered by subsidiaries of the Company. These transactions are also in the ordinary course of our business, and we provide them on terms that we offer to our customers generally. Occasionally, we may have employees who are related to our executive officers, directors or director nominees. We compensate these individuals in a manner consistent with our practices that apply to all employees. The adult sonsister-in-law of Mr. John Hayes, a former executive officer,Squeri, our Chairman and CEO, is employed by the Company in a non-executive position and received compensation in 20172023 of between $151,000$325,000 and $224,000.$350,000. The compensation and other terms of employment of Mr. Hayes’ sonSqueri’s sister-in-law are determined on a basis consistent with the Company’s human resources policies. Certain executive officers, directors and members of their immediate families are directors, employees or have equity interests in companies with whom the Company has entered into ordinary course business relationships from time to time and with whom the Company may enter into additional ordinary course business relationships. These may include ordinary course merchant acceptance relationships pursuant to which these companies accept our charge and credit card products and pay us fees when their customers use these cards, as well as use of the Company’s cards and financial and other products and services, including extensions of credit, on terms and conditions similar to those available to other customers generally. From time to time, we may enter into joint marketing or other relationships with one or more of these companies in the ordinary course that encourage customers to apply for and use our cards. We also may provide ordinary course commercial card and bill payments services or business insights to some of these companies, for which these companies pay fees to us. We may engage in other commercial transactions with these companies and pay or receive fees in those transactions. We have a number of similar ordinary course relationships with Berkshire Hathaway Inc. and its subsidiaries. We have also purchased insurance and other products from subsidiaries of Berkshire Hathaway Inc. in the ordinary course of business and on arm’s-length terms. For information regarding a letter agreement between us and Berkshire Hathaway Inc. related to Berkshire’s investment in the Company, please see “Stock Ownership Information” on pages 111-112. Additionally, the Company may from time to time make charitable contributions to non-profit organizations where our directors or executive officers are directors or trustees.
2024 PROXY STATEMENT 37 • Environmental, Social and Governance (ESG) At American Express, our ESG mission is to back people and businesses to thrive and create equitable, resilient and sustainable communities globally. We seek to mobilize our business to address pressing global challenges and deliver high-impact initiatives that serve our colleagues, customers and communities. In 2021, we developed our ESG strategy and roadmap based on an ESG priority assessment that identified the key issues of importance to our stakeholders, including colleagues, customers, shareholders, communities and partners. This strategy centers around three core pillars: Build Financial Confidence, Advance Climate Solutions and Promote Diversity, Equity and Inclusion. In 2023, we issued a sustainability financing report disclosing that as of December 31, 2022, we had allocated $750 million of the net proceeds of the $1 billion principal amount of sustainability notes that we issued in 2022 to eligible Green and Social Projects in support of our ESG strategy. We also continue to deliver funding through our three core community impact grant priorities: Backing Small, Backing Low-Carbon Communities and Backing Equal Futures. Our ESG Strategy & Goals 
40(1) | Based on spend as reported by consumers in surveys commissioned by American Express (not actual receipts or sales). |
• 38 2024 PROXY STATEMENT 2022-2023 ESG Highlights | | | | | Build Financial Confidence 
| 2018 Proxy Statement | ¾ Supported small businesses, including an estimated $17 billion in reported spending by U.S. consumers at independent retailers and
restaurants on Small Business Saturday in 2023.(1) ¾ Maintained the lowest U.S. fraud rates among major credit card networks.(2) ¾ Awarded over $5.8 million in grants in 2023 to support approximately 750 small businesses in the U.S. and in Australia, Canada, Japan,
Mexico and the United Kingdom. ¾ In 2023, we made or contributed capital to approximately $484 million in investments, community development loans and grants through The American
Express Center for Community Development to support small business needs, job creation and retention and affordable housing, including
the development of 2,500 units for families in need. | | |
| | | | | Advance Climate Solutions 
| | ¾ Maintained carbon neutral operations powered by 100% renewable electricity since 2018.(3) ¾ In 2021, we committed to net-zero emissions in alignment with the Science Based Target initiative (SBTi). In December 2022, we submitted
our near- and long-term emissions reductions targets to the SBTi for validation. We continue to engage with the SBTi throughout the
validation process. ¾ Formed the Climate Risk Management Working Group, which is comprised of senior leaders with direct accountability to the ERMC to
oversee climate risks and met quarterly. In addition, we formed the Net-Zero Working Group, which is comprised of colleagues across the
enterprise, to support the implementation of our net zero strategy. ¾ Set a goal to have the vast majority of plastic cards issued by American Express be made of at least 70% recycled or reclaimed plastic by
the end of 2024. In 2022 and 2023, we continued to expand cards made from recycled or reclaimed plastics globally. ¾ Pledged $12.75 million in grants in 2023 to support small businesses as they prepare for and rebuild stronger in the aftermath of natural
disasters and climate events. | | |
| | | | | Promote Diversity, Equity and Inclusion 
| | ¾ Set an increased goal to support 750,000 underrepresented-owned small- and medium-sized U.S. businesses with access to capital and
financial education from late 2020 through 2025, after exceeding our original goal of 250,000 underrepresented owned businesses in 2022. ¾ Maintained 100% pay equity for colleagues across genders globally and across races and ethnicities in the U.S. ¾ Continued to provide transparency through disclosures on diversity representation among colleagues, including new details on
hiring, promotion and retention of colleagues in the U.S. broken down by race and ethnicity and the “raw median pay gap” for women
globally and for racially and ethnically diverse colleagues in the U.S. | | |
| (1) | The American Express 2023 Small Business Saturday Consumer Insights Survey was conducted by Teneo on behalf of American Express. The study is a nationally representative sample of 2,483 U.S. adults 18 years of age or older. The sample was collected using an email invitation and an online survey. The study gathered self-reported data and does not reflect actual receipts, sales or American Express Card Member spending data. It was conducted anonymously on November 26, 2023. The survey has an overall margin of error of +/- 2.0%, at the 95% level of confidence. Projections are based on the current U.S. Census estimates of the U.S. adult population, age 18 years and over. |
| (2) | The Nilson Report, February 2024. |
| (3) | Achieved carbon neutral operations for Scope 1 (direct emissions from sources owned or controlled by American Express), Scope 2 (indirect location-based and market-based emissions) and Scope 3 (waste and employee business travel, including third-party air, rail and rental cars) emissions through renewable energy credits, carbon offsets and reduced GHG emissions. Operations include all our managed facilities, field sites and data centers. Managed facilities are individual properties operationally managed by our global real estate team and housing critical business functions. Field sites are individual properties that are not operationally managed by our global real estate team but directly by our business units. They are typically smaller sites, less than 30,000 square feet (including airport lounges, foreign exchange kiosks and sales offices) that are owned or leased by American Express. |
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Corporate2024 PROXY STATEMENT 39 •
ESG Governance at American Express2018 Proxy Statement The Service Effect: Corporate Social Responsibility at American Express
Our Approach Our approach to CSR is a natural extension of our commitment to doing what is rightBoard’s Nominating, Governance and our mission to become essential to our customers by providing differentiated products and services to help them achieve their aspirations. The “Service Effect” is shorthand for the positive link we see between CSR performance and business performance. We believe the Service Effect creates value for our shareholders and other stakeholders.
Our commitment extends from creating innovative products to protecting Card Members’ privacy and the security of their data. We deliver value for both our business and our communities by investing financial and human resources in ways that address the social, environmental and economic needs of our communities, customers, colleagues, shareholders and partners.
CSR at American Express
We view service through many lenses. These points of view include:
● | Delivering exceptional products, services and experiences to our customers; | | | ● | Helping business grow and enabling commerce; | | | ● | Promoting a culture of respect that fosters inclusion and trust; | | | ● | Upholding the highest standard of integrity; | | | ● | Safeguarding our customers’ privacy and data; | | | ● | Making a difference in the communities where we work and live; and | | | ● | Helping preserve treasures of the past for future generations to enjoy. |
All of this is underscored by disciplined risk management which ensures we are building a company that will endure as a place that people want to work for, invest in and do business with.
Our CSR Governance Structure
Our executive management holds ultimate responsibility for our CSR progress and success; these leaders review and evaluate key performance indicators and long-term goals related to Environmental and Social Governance (ESG) in their respective business units. At the Board level, the Public Responsibility Committee reviews our CSRESG strategy and Corporate Sustainability program, monitors progress against our goals and provides guidance on our efforts. The Compensation and Benefits Committee of the Board also oversees performance goals and certifies performance outcomes on key talent metrics. The Risk Committee of the Board provides oversight of our ERM framework.
Our Executive Committee also reviews and evaluates ESG performance and long-term goals with support from our ESG Steering Committee. Led by senior executives from across the Company, the ESG Steering Committee developed the goals for our ESG strategy, drawing on the expertise of cross-functional ESG Working Groups. Day to day, our CSRCorporate Sustainability team works with colleagues throughout the Company to shape our effortsESG programs and monitorinvestments and monitors progress on key issues. Emerging risks (e.g., climate risk) are included in our ERM framework and climate-related risks are currently managed as part of our ERM process. The ERMC, chaired by our Chief Risk Officer, is the highest-level management committee to oversee all firm-wide risks and is responsible for risk governance, risk oversight and risk appetite. Furthermore, we have established a dedicated Climate Risk Management Working Group with direct accountability to the ERMC. Additionally, in preparation for increased international regulatory interest and requirements on climate risk and ESG issues.reporting, we also formed international ESG Working Groups that are organized with respect to specific international jurisdictions and include a localized ESG governance structure that ladders up to the enterprise ESG Governance Framework. Executive compensation also continues to be linked to our ESG goals. For example, we have incorporated the management of key ESG priorities, including metrics, into our executive compensation program under the Strategic category of our annual scorecard. For more information, see the “Compensation, Discussion and Analysis” section of this Proxy Statement. 
• 40 2024 PROXY STATEMENT Colleague Diversity At American Express, we continue to work to build an inclusive and diverse workplace that values every voice, rewards teamwork, celebrates different points of view and reflects the diversity of the communities in which we operate. 2023 Global Workforce Representation We work to create a culture built on supportive relationships and an inclusive workplace as reflected by our Blue Box Values. We regularly disclose representation data on our global workforce to provide transparency, including our EEO-1 data and other information featured in our ESG Report. | (1) | Based on self-identified characteristics. |
| (2) | Based on data for the 2023 U.S. Employer Information Report (EEO-1) submission for Black/African American, Hispanic/Latino, Asian, Native American or Alaskan Native, Native Hawaiian or Pacific Islander and two or more races. |
2024 PROXY STATEMENT 41 • Maintaining 100% Pay Equity | | | 
| | In 2023, for the fourth consecutive year, we maintained 100% pay equity for colleagues across genders globally and across races and ethnicities in the United States. |
At American Express, we strive to treat everyone who works for us fairly and equally. We are committed to paying all colleagues equitably and maintaining bias-free, transparent compensation practices, and we are proud of our leadership in this area. Our Service Ethoscompensation practices reward colleagues based on performance, and we have policies and processes in place to help ensure we compensate colleagues fairly and equitably. We review these practices regularly, and since 2017 we have also worked each year with independent experts to conduct a pay equity review. This analysis covers our entire global colleague base across genders globally and across races and ethnicities in the U.S., assessing pay on a statistical basis and considering key factors that influence compensation, including but not limited to tenure, role, level, geography and performance. In 2023, for the fourth consecutive year, we maintained 100% pay “equity”—meaning no statistical differences in pay—across genders globally, as well as across races and ethnicities in the U.S. We continued to make necessary investments and appropriate salary adjustments to reach this goal. We are proud of this achievement and are committed to maintaining this goal going forward. Since 2021, we have also disclosed our “raw median pay gap” and provided data on the company’s hiring, promotions and retention efforts for colleagues across gender globally and race and ethnicity in the United States. The “raw median pay gap” metric compares differences in raw median base pay making no adjustments for factors such as role, level, tenure, performance or geography. Additional information regarding our “raw median pay gap” can be found in our ESG Report. Creating an Inclusive Workplace Culture Our DE&I vision is to provide the world’s best customer experience every day. Our customers expect exceptional servicesupport a diverse, equitable and we aim toinclusive workforce, marketplace and society. We see the worlddiversity of people and experiences as fuel for the creativity and innovation that make us better as a team and ultimately help us deliver better results. Our Blue Box Values of “We Respect People,” “We Embrace Diversity” and “We Stand for Equity and Inclusion” bring our vision to life to back our colleagues, customers and communities. Our Colleague Networks play an important part in the culture of American Express, building community, offering support and fostering a sense of inclusion and belonging. They also serve as an important source for feedback—helping us learn more about the colleague experience and, in turn, guiding the resources, events and backing we provide. Our first documented Colleague Network was formed in 1920 to bring together colleagues who share common experiences, interests and backgrounds through their eyes,recreation, athletics and exceed their expectations—always finding new waysstudy. Colleague Networks are voluntary and continue to enrich their lives, make their businesses more successful, and help them achieve their aspirations.evolve. We have a broad, diverse and loyal customer base—spanning consumers and businesses of all sizes; partners who issue cards on our network and who work14 dedicated Colleague Networks with us to create special products and services; and merchants who welcome our Card Members. We value our strong customer relationships and define ourselves by how well we take care of them. American Express is the world’s largest card issuer by purchase volume. We process millions of transactions, driving more than $1 trillion in commerce annually. We have approximately 55,000 global colleagues striving120 chapters worldwide. These groups offer networking, growth opportunities and the ability to make each customer interaction a positive, secureget more involved within the Company.
Supporting Colleague Health, Safety and convenient experience. | 41
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Serving our ColleaguesWell-Being
We aim back our colleagues and their loved ones with benefits and programs that promote their holistic well-being. That means we prioritize their physical, financial and mental health through each stage of life. We invest in our colleague’s physical health and well-being through our innovative, award-winning global corporate wellness program, Healthy Living. Healthy Living highlights the importance of preventive care, encourages and rewards healthy actions and provides colleagues and their loved ones with the support they need through our leadership, policies and work environment. Our global financial well-being program, Smart Saving, provides resources and tools like financial coaching—at no cost—to inspire a company culture where differences are embracedhelp colleagues make better decisions about their finances. By offering this ongoing education and support, in addition to competitive base salaries and incentives, we’re helping colleagues are enabled to reachbuild their full potential. We advocate for our colleagues’ professional growthfinancial confidence so they can be championslive well, now and in the future.
• 42 2024 PROXY STATEMENT Through our global mental health program, Healthy Minds, we are increasing awareness about mental health and providing resources and support for our customers.colleagues so they can care for their well-being and get help when they need it. Since launching Healthy Minds over a decade ago, we have continued to innovate and strengthen our program, and today, in addition to free counseling for colleagues and their loved ones, we offer telehealth, grief and loss support, group support sessions and mental health trainings. Fostering Personal and Professional Growth We continue to back our colleagues’ growth and development and enable them to build new skills, achieve their career goals and develop as leaders at all levels. We offer a range of learning and development opportunities with resources, feedback and support, including: Career Growth @ Amex provides clear guidance to help colleagues navigate and grow their careers. It’s built on four pillars: Deliver, Reflect, Learn and Connect, and includes a suite of resources and support aligned to each pillar for colleagues and leaders. The guides for leaders focus on helping them have ongoing career conversations with their team members. An integral part of Career Growth @ Amex is the Career & Development Plan, an internal tool for colleagues to map out their career journey, aspirations and development goals, and the support they need along the way. Leadership @ Amex includes a suite of learning opportunities and resources that are grounded in our strategy, Leadership Behaviors and the Blue Box Values, to help colleagues at all levels develop and strengthen their leadership skills. We also offer People Leadership @ Amex to help leaders become great performance and career coaches and utilize the Leadership Behaviors with their teams. Feedback @ Amex provides resources and support to help colleagues strengthen their coaching and feedback skills and foster a culture where giving and receiving feedback is part of our every day. LinkedIn Learning gives colleagues quick and easy access to thousands of courses and videos taught by industry experts on topics like business, leadership, technology, creativity and personal development. Project MarketPlace is our enterprise-wide project-sharing platform where all colleagues can apply for special, short-term projects (up to six months in duration) and explore different career areas, build skills and explore interests. The MarketPlace also allows project leaders to diversify perspectives on their team and expand short-term resource capacity to get tasks done quickly and effectively, all while honing their leadership skills. The Accelerated Leadership Development Program equips high-potential Vice Presidents with the opportunity to strengthen their Leadership Behaviors. The experience includes instructor-led sessions with external experts, speaker series with internal leaders, leadership assessments, mentorship and more. Our ESG Ratings We monitor our performance across several environmental, social and governance-related ratings and rankings. Highlights from 20172023 include: | 87PERCENT | 100PERCENT | | | | | | | | | | | | | | | | | | | | | | of our colleagues who responded in 2017 to our annual employee survey, The Pulse, said they would recommend our Company as a great place to work. | score on the 2017 Human Rights Campaign’s Corporate Equality Index, based on our policies and practices that support lesbian, gay, bisexual, transgender and queer (LGBTQ) inclusion. | | | | | | |  | 10,000+ | online and face-to-face training activities were available to our colleagues, and we launched the American Express Leadership Academy, a curated collection of the best tools, programs and processes in leadership development for all colleagues. |
| 20 | | weeks gender-neutral paid parental leave for U.S.-based regular full-time and part-time colleagues. Birth mothers are eligible to receive an additional six to eight weeks of paid leave if medically necessary. | | | | 96PERCENT | 43PERCENT | | | of our colleagues had access to at least one Healthy Living program or service in 2017.CDP (Climate
Change)
Rating B | | | |  | | Human Rights Campaign Corporate Equality Index – Score of 100% | of our U.S. colleagues had a flexible work arrangement in 2017. |
We hold ourselves to the highest standards of ethics and integrity and have built corporate citizenship into the heart of our company. Examples of our commitment are set forth below:
● | All of our colleagues receive Enterprise Essential Training to ensure an understanding of the important policies, laws and regulations that govern our industry, guide our company, and protect our colleagues, customers, and brand. Modules include trainings on our Code of Conduct, information security, anti-discrimination and anti-money laundering. | | | | ● | We introduced the Amex Ethics Hotline, an independent, confidential and anonymous resource in May 2017. This online and phone-based tool is available anytime in more than 200 languages to Company colleagues, contractors, vendors,suppliers and others to raise concerns about potential ethical or compliance matters. | | | ● | Our emphasis on risk management and governance structure—along with solid business practices—ensures ourpromise of security, integrity and trust to our key stakeholders. For additional information regarding our Board’soversight of risk management, seepage 24. |
Through our business activities, relationships and philanthropic efforts, we put the power of service and great customer experiences into action daily.
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Corporate Governance at American Express2018 Proxy Statement
Delivering for our Customers and Partners
We have a broad and diverse customer base that spans consumers at different stages of their lives; small and midsize companies, and large corporations; partners who issue cards on our network, and others who work with us to create special products and experiences; and the merchants who welcome our Card Members. We use our relationships, technology and data to better serve our customers and increase commerce opportunities for our partners.
Highlights from 2017 include:
● | Developing new mobile and digital platforms to meet the changing habits of our global customer base and investing in innovative technologies for more secure connections. | | |
– | We have been rated as one of Ponemon’s Most Trusted Companies for Privacy for the past 10 years. | | | – | Customer satisfaction has increased 24 percent since 2011 based on Card Member feedback. | | |
● | We support entrepreneurs and more inclusive communities | | |
– | Eight years ago, we started an initiative “Small Business Saturday” to help drive U.S. consumers to shop at small businesses. According to data from the 2017 Small Business Saturday Consumer Insights Survey, an estimated 108 million U.S. consumers reported shopping or dining at local independently owned businesses that day. | | | – | In 2017, our Center for Community Development underwrote $474 million in loans and investments, resulting in the creation of 3,153 units of affordable housing, driving stronger and more inclusive cities. | | |
● | We enable our Card Members to give back | | |
– | From 2010 to 2017, U.S. Card Members donated over $89 million through our Members GiveSMprogram by donating dollars on their American Express Cards and redeeming Membership Rewards points to benefit charitable causes.
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Caring for our Communities
We aim to make a difference by strengthening the communities where we work and live. Through our philanthropic and civic participation we empower the people and organizations addressing society’s most complex issues. We do this in three ways: 1) empowering social-sector leaders to create sustainable change at a local level by providing leadership training; 2) helping citizen volunteers improve their local communities; and 3) preserving diverse, vibrant historic places. We also fund immediate and long-term relief and recovery efforts to help victims of natural disasters.
Highlights from 2017 include:
● | Contributed nearly $40 million with more than 550 grants and support for 5,300 colleague-selected organizations through the Company’s gift matching program. Our grants: | | |
– | Supported more than 85 nonprofits that engaged nearly six million volunteers in about 25 million hours of service to serve the needs of local communities. | | | – | Helped train nearly 20,000 nonprofit and social leaders through online and in-person trainings. | | | – | Helped preserve 40 historic sites in seven countries, including the U.S., UK, Argentina, France, Mexico, Canada, and China (Hong Kong). |
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Doing What’s Right for our Environment
We recognize our responsibility to help preserve natural resources for future generations and aim to limit the environmental impact of our business operations. From 2011-2016, we reduced our carbon footprint by more than 30 percent.
Highlights from 2017 include:
 | We purchased150,000 MWH of renewable energy certificates, resulting in100 percent carbon-free electricity in our U.S. data center facilities and our New York City headquarters. | Over 45 percentof our global real estate portfolio wasgreen building certified
|
| We provided over
3.9
MILLION DOLLARS
in support of the environment and wildlife through the Company’s gift matching and community service grant program.
| | 20,000 employeesparticipatedInclusion in our Earth Month activities,helping plant 18,000 trees. | Bloomberg’s Gender-Equality Index | | | 89PERCENT
of our global managed real estate footprintparticipated in Earth Hour.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |  | | We set new science-based targets for absolute, aggregate reductions in greenhouse gas emissions, including:MSCI (ESG)
●Carbon neutrality for business travel emissions by 2020;
●31 percent reduction in greenhouse gas emissions from 2011 baseline by 2021;
●100 percent of electricity procured for U.S. operations from renewable sources by 2040; and
●85 percent reduction in greenhouse gas emissions from 2011 baseline by 2040.
Rating AA | | | | 
| | Sustainalytics ESG Risk Rating Low-Risk | | | | | | | | | | |
External
2024 PROXY STATEMENT 43 • Awards and Recognition Our commitment to being an employer of choicebe a great place to join, stay and grow a responsible companycareer continues to earn us industry awards and recognition. Below isHere are some of the 2016 and 2017 recognitionrecent recognitions that makesmake us proud.proud: | ¾ | | Anita Borg Top Companies for Women Technologists |
●¾ | Fortune World’s Most Admired Companies | Axios Harris Poll 100 Corporate Reputation Study—ranked #17 |
●¾ | Fortune | Bloomberg’s Gender Equality Index (since 2016) |
| ¾ | | Disability Equality Index & Best Places to Work for People with Disabilities—90% |
| ¾ | | Forbes Top 100 Best Companies to Work For in Spain—Top 10 |
●¾ | Fortune 50 | FORTUNE Great Place to Work List—ranked #3 |
| ¾ | | FORTUNE Best Workplaces in Financial Services & Insurance—ranked #1 |
| ¾ | | FORTUNE Best Workplaces in New York—ranked #1 |
| ¾ | | FORTUNE World’s Most Admired Companies—ranked #10 |
| ¾ | | Great Place to Work: Best Workplaces in Italy—ranked #3 |
| ¾ | | Great Place to Work: Best Workplaces in Japan—ranked #3 |
| ¾ | | Great Place to Work: Best Workplaces in the Philippines—ranked #6 |
| ¾ | | Human Rights Campaign Corporate Equality Index—score of 100% |
| ¾ | | JUST Capital—JUST 100 List—ranked #11 overall and #1 in Transaction Processing |
| ¾ | | LinkedIn Top Companies in the UK—Ranked #16 |
| ¾ | | Mediacorp: Canada’s Best Diversity Employers |
| ¾ | | Merco’s Companies with Best Corporate Reputation in Mexico |
| ¾ | | People Companies that Care—ranked #3 |
| ¾ | | Seramount 100 Best Companies for Diversity |
● | Human Rights Campaign: corporate equality index, rating American workplaces on LGBT equality(score 100 percent) | ● | FTS4Good Index series since 2004 | ● | 2017 Fortune Change the World list | ● | CDP score A- | ● | EPA Green Power: Top user of sustainable energy since 2014 | ● | Newsweek Green ranking: top U.S. green companies since 2011 | | ¾ | | Seramount Inclusion Index |
| ¾ | | TIME Magazine’s World Best Companies—ranked #7 |
Learn More About CSRabout Corporate Sustainability and ESG Matters at American Express Please visit go.amex/esg for our corporate website athttp://about.americanexpress.com/csr2022-2023 ESG Report, TCFD Index, SASB Index, GRI Content Index and to learn how we, together withmore about our customers, colleaguesESG activities. These reports, and shareholders,any other information from the American Express website, are making a difference in our communities.not incorporated by reference into this Proxy Statement.
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• 44 2024 PROXY STATEMENT Audit Committee Matters Item 2: Ratification of Appointment of Independent Registered Public Accounting Firm | ITEM 2 | Ratification of Appointment
of Independent Registered Public Accounting Firm
|  following resolution: |
RESOLVED, that the appointment by the Audit and Compliance Committee of the Company’s Board of Directors of PricewaterhouseCoopers LLP, as independent registered public accounting firm for the Company, to audit the accounts of the Company and its subsidiaries for 2018, is hereby ratified and approved.
The Audit and Compliance Committee has sole authority to appoint and replace the Company’s independent registered public accounting firm, which shall reportreports directly to the Committee, and is directly responsible for its compensation and oversight of its work. In February 2018,The Audit and Compliance Committee conducted its annual evaluation of PricewaterhouseCoopers LLP (PwC) and, after assessing the performance and independence of PwC, the Committee believes that retaining PwC is in the best interests of the Company. The Audit and Compliance Committee reappointed PricewaterhouseCoopers LLP (PwC)PwC as our independent registered public accounting firm for 2018.2024. We are asking you to ratify this appointment. If shareholders fail to ratify the appointment, the Audit and Compliance Committee will consider it a directiondirective to consider other accounting firms for the subsequent year. One or more representatives of PwC will be present at the meeting, will be given the opportunity to make a statement if he or she desires to do so and will be available to respond to appropriate questions. | RESOLVED, that the appointment by the Audit and Compliance Committee of the Company’s Board of Directors of PricewaterhouseCoopers LLP, as independent registered public accounting firm for the Company, to audit the financial statements of the Company and its subsidiaries for 2024, is hereby ratified and approved. 
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2018 Proxy Statement Audit Committee Matters2024 PROXY STATEMENT 45 •
Actions Taken by the Audit and Compliance Committee to Support its Recommendation
| Areas of Focus | | Actions A Detailed Assessment | PwC has been our independent auditor since 2005. The Audit and Compliance Committee charter requires a detailed review of the independent audit firm, including as compared to other firms, at least every 10 years | |  | PwC has been our independent auditor since 2005.years. This review, last conducted in 2014, assessed PwC’s performance across the following criteria: professional expertise, audit engagement team performance, including the quality of information provided on accounting and auditing issues and regulatory developments, communications, independence and objectivity and fees. In addition, the review considered the advisability and the potential impact of selecting a different independent registered public accounting firm. A wide range of internal stakeholders were surveyed and asked to comment generally, identify areas for recognition and improvement and indicate how PwC’s performance was trending over time. PwC’s audit fees were benchmarked against other firms based on publicly available data. The positive results of the review resulted in the decision to continue to engage PwC and also identified several areas withof opportunity for improvement that were discussed with PwC. A detailed review of PwC will again be conducted in 2024 in accordance with the charter requirement. |
| PwC’s Objectivity and Independence | PwC’s objectivityThe Audit and independence | | | ReviewsCompliance Committee reviews relationships between PwC and American Express that may reasonably be thought to bear on independence and reviews PwC’s annual affirmation ofindependence evaluation and assesses its independence. Recognizing that independence and objectivity can be compromised by an auditor’s provision of non-audit services, the Audit and Compliance Committee has approved a management policy governing the provision of services by PwC. |
| Quality of PwC’s auditing practicesAuditing Practices | The Audit and PwC’s commitment to quality, efficiency and adding value | | | ReviewsCompliance Committee reviews issues raised by the Public Company Accounting Oversight Board (PCAOB) reports on PwC, PwC’s internal quality control procedures and results of PwC’s most recent quality control reviews, as well as issues raised by recent governmental investigations. Discussesinvestigations, if any. The Audit and Compliance Committee also discusses PwC’s quality initiatives and the steps PwC is taking to enhance the quality and efficiency of its audits with the lead engagement partner and with the PwC senior relationship partner assigned to American Express.partner. |
| PwC’s Performance as Auditor | PwC’s performance as auditor | | | DiscussesThe Audit and Compliance Committee discusses and comments on PwC’s audit plan and strategy for the audit, including the objectives, overall scope and structure, the resources provided and available at the firm and the Audit and Compliance Committee’s expectations. ReceivesThe Audit and Compliance Committee also receives periodic updates from the lead engagement partner on the status of the audit and areas of focus by PwC. |
| Performance of Lead Engagement Partner | Performance of lead engagement partner | | | The lead engagement partner of PwC is subject to a mandatory five-year rotation period. The Audit and Compliance Committee chair is involved in selecting the lead engagement partner. In preparation for the current lead engagement partner mandatory rotation, which takes effect in 2024, a new lead engagement partner has been selected. During the year, the Audit and Compliance Committee chair meets one-on-one with the lead engagement partner to promote a candid dialogue and the Audit and Compliance Committee meets in executive session with the lead engagement partner to discuss the progress of the audit and any audit issues, deliver Audit and Compliance Committee feedback and discuss any other relevant matters. |
| PwC’s communicationsCommunications with the Audit and Compliance Committee | | | The Audit and Compliance Committee gives feedback to the lead engagement partner on the clarity, thoroughness and timeliness of PwC’s communications to the Audit and Compliance Committee. |
| Terms of the engagementEngagement and audit fees Audit Fees | | | The Audit and Compliance Committee reviews the engagement letter and approves PwC’s audit and non-audit fees. |
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Audit Committee Matters 2018 Proxy Statement• 46 2024 PROXY STATEMENT
PricewaterhouseCoopers LLP Fees and Services Fees for 20172023 and 20162022 The following table sets forth the aggregate fees billed for services rendered or to be billedprovided by PwC for each of the last two fiscal years (in thousands): | Types of Fees | | 2017 | | 2016 | | Audit Fees | | $ | 23,415 | | $ | 22,885 | | Audit-Related Fees(1) | | | 4,210 | | | 3,829 | | Tax Fees | | | 30 | | | 8 | | All Other Fees | | | 148 | | | 110 | | TOTAL | | $ | 27,803 | | $ | 26,832 |
| | | | | | | | | | | | Types of Fees | | 2023 | | | 2022 | | | | | Audit Fees | | | $33,215 | | | $ | 29,835 | | | | | Audit-Related Fees(1) | | | 2,968 | | | | 3,124 | | | | | Tax Fees | | | 1,255 | | | | 1,235 | | | | | All Other Fees | | | 70 | | | | 96 | | | | | TOTAL | | | $37,508 | | | $ | 34,290 | |
| (1) | PwC performs the audit of the Company’s pension plansplan for Switzerland and Hong Kong, where the fees are paid by the respective plan. These fees, which totaled $19K and $17K in 2023 and 2022, respectively, are not included in Audit-Related Fees since they were not paid by the Company. The total fees for these two audits in each of 2017 and 2016 were $31K for each year. |
In the table above, in accordance with SEC rules, “Audit Fees” consist of fees for professional services rendered for the integrated audit of our consolidated financial statements, review of the interim consolidated financial statements included in quarterly reports, and services provided in connection with statutory and regulatory filings or engagements and other attest services. “Audit-Related Fees” consist of fees for assurance and related services that were reasonably related to the performance of the audit or review of our financial statements. The services included employee benefit plan audits,due diligence, internal control reviews, attest services not required by statute or regulation and attest services for non-financial information, consultations on financial accounting and reporting matters not classified as audit. “Tax Fees” consist of fees for professional services rendered for tax compliance and tax consulting services. “All Other Fees” are fees for any services not included in the first three categories. Policy on Pre-Approval of Services Provided by PricewaterhouseCoopers LLP The terms of our engagement of PwC are subject to the pre-approval of the Audit and Compliance Committee. All audit and permitted non-audit services require pre-approval by the Audit and Compliance Committee in accordance with pre-approval procedures established by the Audit and Compliance Committee. In accordance with SEC rules, the Audit and Compliance Committee’s pre-approval procedures have two different approaches to pre-approving audit and permitted non-audit services performed by PwC. Proposed The Audit and Compliance Committee specifically pre-approves the terms and fees of the planned annual audit and permitted non-audit services that are to be performed by PwC. Other proposed engagements may be pre-approved up to an aggregate fee threshold, pursuant to procedures established by the Audit and Compliance Committee that are detailed as to athe particular classand defined classes of serviceservices without consideration by the Audit and Compliance Committee of the specific case-by-case services to be performed if the relevant services are predictable and recurring. performed. We refer to this pre-approval method as “general pre-approval.” If a classpre-approval” and the Company’s Controller reports such pre-approved engagements to the Audit and Compliance Committee at least quarterly. The procedures also require all proposed engagements of service hasPwC for services of any kind that have not received specific or general pre-approval the service will require specific pre-approval as described above to be approved by the Audit and Compliance Committee before(or, should a time-sensitive need arise, its Chair) prior to the beginning of any such service is provided by PwC.services. All services provided by our independent registered public accounting firm have been pre-approved in accordance with these procedures. The procedures require all proposed engagements of PwC for services of any kind to be directed to the Company’s Controller and then submitted for approval to the Audit and Compliance Committee (or, should a time-sensitive need arise, to its Chair) prior tohas reviewed the beginningservices performed by PwC and the related fees were consistent with the maintenance of any services.PwC’s independence. Other Transactions with PricewaterhouseCoopers LLP We have a number of business relationships with individual member firms of the worldwide PwC organization. Our subsidiaries provide card services to some of these firms and these firms pay fees to our subsidiaries. These services are in the normal course of business and we provide them pursuant to arrangements that we offer to other similar clients. |
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2018 Proxy Statement Audit Committee Matters2024 PROXY STATEMENT 47 •
Report of the Audit and Compliance Committee A role of the Audit and Compliance Committee, which is composed of independent and financially literate directors, is to assist the Board in its oversight of the company’sCompany’s financial reporting process. Management has the primary responsibility for the financial statements and the reporting process, including the system of internal control over financial reporting. PwC is responsible for auditing the Company’s financial statements and its internal control over financial reporting, in accordance with the standards of the PCAOB, and expressing opinions as to the conformity of the financial statements with accounting principles generally accepted in the United States and the effectiveness of internal control over financial reporting. In the performance of its oversight function, the Audit and Compliance Committee has reviewed and discussed with managementManagement and PwC the Company’s audited financial statements. The Audit and Compliance Committee has also has discussed with PwC the matters required to be discussed by Auditing Standard No. 1301, as adopted bythe applicable requirements of the PCAOB relating to communications with audit committees.and the SEC. In addition, the Audit and Compliance Committee has received from PwC the written disclosures and letterletters required by applicable requirements of the PCAOB regarding PwC’s communications with the audit committee concerning independence, has discussed with PwC their independence from the Company and its management,Management, and has considered whether PwC’s provision of non-audit services to the Company is compatible with maintaining the firm’s independence. The Audit and Compliance Committee discussed with the Company’s Chief Audit Executive and PwC the overall scope and plan for their respective audits. Internal Audit is responsible for preparing an annual audit plan and conducting internal audits under the direction of the Company’s Chief Audit Executive, who is accountable to the Audit and Compliance Committee. The Audit and Compliance Committee met with the Chief Audit Executive, the Controller and PwC, with and without managementManagement present, to discuss the results of their examinations, their evaluations of the Company’s internal controls and the overall quality of the company’sCompany’s financial reporting. In addition, the Audit and Compliance Committee met with the CEO and Chief Financial Officer of the CompanyManagement to discuss the processes that they have undertaken to evaluate the accuracy and fair presentation of the Company’s financial statements and the effectiveness of the Company’s systems of disclosure controls and procedures and internal control over financial reporting. Based on the reviews and discussions referred to above, the Audit and Compliance Committee recommended to the Board that the Company’s audited financial statements be included in the Company’s Annual Report on Form 10-K for the year ended December 31, 20172023 for filing with the SEC. AUDIT AND COMPLIANCE COMMITTEE Daniel L. Vasella, Chair
John J. Brennan
Ralph de la Vega
Anne (Chair)
Thomas J. Baltimore John J. Brennan Karen L. Lauvergeon
Michael O. LeavittParkhill
• 48 2024 PROXY STATEMENT Executive Compensation Item 3: Advisory Resolution to Approve Executive Compensation (Say-on-Pay)
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Executive Compensation
ITEM | 3 | Advisory Resolution to Approve Executive
Compensation (Say on Pay)
| The Board recommends a voteFORthis item. |
Pursuant to regulations under Schedule 14A of the Securities Exchange Act of 1934, we are asking you to approve, on an advisory basis, the compensation of the Company’s NEOsNamed Executive Officers (NEOs) disclosed in the CD&A,Compensation Discussion and Analysis (CD&A), the compensation tables, notes and narrative in this proxy statement.Proxy Statement. Our Board believes that the compensation of our executive officers is aligned with performance, is sensitive to our share price and appropriately motivates and retains our executives, and is a competitive advantage in attracting and retaining the high caliber of executive talent necessary to drive our business forward and build sustainable value for our shareholders.executives. We believe our executive compensation program delivers pay whichthat is strongly linked to Company performance over time. We engage with shareholders throughout the year, including discussing our compensation program and practices, and we also obtain feedback through this annual say on paySay-on-Pay vote. As part of our responsiveness plan this year, we have done additional outreach and received substantial shareholder input and feedback. As a result, we made a number of changes to our programs and disclosure. Although this advisory vote is non-binding, the results of this vote and the views expressed by our shareholders in these discussions will inform the CBC’sCompensation and Benefits Committee’s future decisions about our executive compensation. RESOLVED, that the compensation paid to the Company’s NEOs, as disclosed pursuant to Item 402 of Regulation S-K, including in the CD&A, compensation tables, notes and narrative discussion, is hereby approved. | 49 |
Section Table of Contents 
2024 PROXY STATEMENT 49 • Compensation Discussion and Analysis Our CD&A describes our executive compensation programs and compensation decisions in 2017 for our NEOs, who for 20172023 were: | Name | Title | Kenneth I. Chenault | | Chairman and CEO* | Stephen J. SqueriChairman and Chief Executive Officer |
Stephen Squeri has been Chairman and Chief Executive Officer of American Express since 2018. As Chairman and CEO, Mr. Squeri has a unique perspective and has demonstrated leadership qualities and management capabilities to drive the long-term success of the Company. Under his leadership, American Express has launched innovative payments, financial management and lifestyle offerings, expanded strategic partnerships, enhanced digital capabilities, reshaped its strategy to drive growth in international markets and expanded its merchant network globally. In his previous role as Vice Chairman, Mr. Squeri led the Company’s Global Commercial Services group, as well as its shared services groups which included Technology, Customer Service, Collections, Real Estate and Procurement. Mr. Squeri joined American Express in 1985 as a manager in the Travelers Cheque Group and has held a variety of senior roles across the Company, including President of the Establishment Services Group in the U.S. and Canada; President of the Corporate Card group; and Chief Information Officer. | Vice Chairman* | Christophe Y. Le Caillec Chief Financial Officer |
Christophe Le Caillec is the Chief Financial Officer of American Express, a role he assumed in August 2023. As a member of the Executive Committee, Mr. Le Caillec plays an important role in developing the strategic direction for American Express. His responsibilities include overseeing the Company’s financial operations worldwide and representing the Company across the financial community. Prior to being named CFO of American Express, Mr. Le Caillec was Deputy CFO. In this role, he partnered closely with the Executive Committee to drive the Company’s financial performance, and also led the Corporate Planning team, as well as Risk, Technology and the Global Services Group Finance functions. He joined American Express in 1997 and has held several global business roles of increasing leadership in Paris, Sydney, Singapore, London and, most recently, New York. | | | Douglas E. BuckminsterVice Chairman |
Doug Buckminster is Vice Chairman of American Express. As a member of the Executive Committee, Mr. Buckminster plays a central role in driving the overall strategic direction of the Company and accelerating growth opportunities globally. He also leads several areas of the business including Global Advertising and Brand Management and Enterprise Innovation Partners, which is responsible for digital incubation, strategic partnerships and corporate development. He also oversees our relationship with our joint venture in China. Mr. Buckminster previously served as Group President of Global Consumer Services responsible for consumer products and services, digital strategy and capabilities and risk and information management; President, Global Network & International Card Services responsible for growing the consumer and bank partnership businesses in more than 150 countries; and President, International Consumer and Small Business Services. Mr. Buckminster has also served as regional president for American Express International’s Latin America, Canada and Caribbean (LACC) region and general manager of the International Lending and Insurance Services organizations.
• 50 2024 PROXY STATEMENT | President, Global Consumer Services** | Jeffrey C. Campbell | | ExecutiveFormer Vice PresidentChairman and Former Chief Financial Officer(1) |
Jeff Campbell served as Vice Chairman of American Express, having recently retired as CFO in 2023. In 2021, Mr. Campbell was appointed Vice Chairman, in addition to his role as CFO, and was a member of the Executive Committee. Mr. Campbell played an important role in developing the strategic direction for American Express, overseeing the Company’s financial operations worldwide and representing the Company to the financial community. Before joining American Express as CFO in 2013, Mr. Campbell was CFO of the McKesson Corporation, the largest healthcare services Company in the United States. He played an essential role as McKesson grew significantly and expanded its leadership in healthcare distribution and technology. Previously, Mr. Campbell spent 13 years at AMR Corp. and its principal subsidiary, American Airlines, ultimately becoming their CFO in 2002. | Anré D. Williams Group President, Enterprise Services and CEO American Express National Bank |
Anré Williams is Group President, Enterprise Services and Chief Executive Officer of AENB, a role he assumed in April 2021. As Group President of Enterprise Services, Mr. Williams leads the Company’s largest shared services organizations globally, including technology, digital capabilities, servicing for Card Members, merchants and consumer travel customers, real estate and procurement. As CEO of AENB, Mr. Williams oversees American Express’ U.S. banking operation, which is responsible for approximately 60 percent of the Company’s total billings and revenues. Previously, he was Group President of Global Merchant & Network Services (GMNS), responsible for managing relationships with the millions of merchants around the world that accept American Express Cards, and the Company’s payments network, bank partnerships, international loyalty coalition programs and relationships with its largest strategic partners. Mr. Williams is a member of the American Express Executive Committee and the AENB Board of Directors. | Laureen E. Seeger | | Executive Vice President and General CounselChief Legal Officer |
Laureen Seeger is Chief Legal Officer of American Express Company, a position she assumed in July 2014. As a member of the Executive Committee, she oversees the Legal, Government Affairs, Global Security and Corporate Secretarial functions for American Express and its subsidiaries. She is also a member of the Enterprise Risk Management Committee. Prior to American Express, Ms. Seeger served as Executive Vice President, General Counsel and Chief Compliance Officer of McKesson Corporation. Preceding her appointment in March 2006, she was Vice President and General Counsel of McKesson Provider Technologies (MPT), McKesson’s health care information technology solutions business. Before joining McKesson, Ms. Seeger was Partner-In-Charge of the Technology Litigation Section at the law firm Morris, Manning & Martin, LLP. *(1) | Mr. Squeri succeededCampbell is included as an NEO due to his service as CFO of the Company until August 14, 2023 and his 2023 compensation. Mr. ChenaultCampbell also served as Vice Chairman and CEOof the Company until his retirement on FebruaryMarch 1, 2018. | ** | Mr. Buckminster was promoted to Group President, Global Consumer Services on February 1, 2018.2024.
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Table
2024 PROXY STATEMENT 51 • Section 1: Executive Summary The executive compensation program has been designed to drive strong business performance and to align executive compensation with long-term shareholder interests. A large portion of Contents
Tabletotal compensation of Contentsour NEOs is at risk and directly tied to Company and individual performance. The CD&A that follows provides shareholders with information about the design of the compensation programs, compensation decision-making process, our 2023 compensation decisions for our NEOs and our responsiveness to shareholder feedback as a result of last year’s Say-on-Pay results.
Compensation Discussion2023 Company Performance
Summary of Performance Our 2023 results reflect the engagement and Analysis2018 Proxy Statement Executive Summary
Business and Strategic Updates
In 2015, we implemented a two-year game plan to addressloyalty of our customers, the challenging economic, competitive and regulatory environment. Our results for 2017 reflect a strong finish to our two-year game plan as we successfully executed against our key prioritiessuccess of accelerating revenue growth, optimizing our investments and resetting our cost base. Our performance in 2017 reflects benefits from the investments we have made in a variety of growth opportunities over the last several years. Although we continue to see some headwinds in markets around the worldrefresh and intense competition, we remain focused on delivering differentiated value toexpand our merchants, customers and business partners while delivering returns to our shareholders. Importantly, we built momentum through 2017 with both revenue and billings growth higher in Q4 than any other quarter of 2017. Our EPS for 2017 was $2.97 on a reported basisproduct offerings and our adjusted EPSfocus on effective risk management and expense discipline. The successful execution of $5.871(excludingour growth strategy, along with the impactsstrength of our premium customer base and differentiated business model, drove net income of $8.4 billion, or $11.21 per share, compared with net income of $7.5 billion, or $9.85 per share, a year ago. These results, paired with our consistent performance over time, have led to strong shareholder returns, with a 1 year Total Shareholder Return of 29%, outperforming the Tax Act) came in at the higher end of the increased guidance we gave at the end of the third quarter. This was above the initial guidance from the start of the year (EPS of $5.60 to $5.80). The Compensation and Benefits Committee determined the Company’s performance to be significantly above the target level and assigned a G1 rating (seepage 56 for more information on the Company’s rating system) to the Company.S&P Financials Index by 17 percentage points.(1)
Financial Performance HighlightsOur 2023 key accomplishments include:
●¾ | | Revenues:Total revenues rose 4 percent in 2017, even as compared toGrew total billed business by 9% versus the prior year, which included two quarters of revenuewith growth driven by spending from our Costco relationship;U.S. consumer Card Members and Card Members outside of the U.S.;
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| ¾ | | Continued to drive strong customer engagement and demand for our premium products remained robust; |
| ¾ | | Added 12.2 million new proprietary cards, bringing the total number of cards-in-force issued on our global network to over 140 million; |
| ¾ | | Continued to drive generational relevance, with Millennial & Gen-Z customers representing over 60% of new consumer account acquisitions globally; |
| ¾ | | Achieved industry-leading credit performance, with net write-off and delinquency rates for Card Member loans and receivables below pre-pandemic levels; |
| ¾ | | 91% of colleagues who participated in our annual Colleague Experience Survey said they would recommend American Express as a great place to work; and |
| ¾ | | Sustained virtual parity coverage in the U.S., with approximately 99% of credit-card accepting merchants able to accept American Express(2), and continued to grow international coverage. |
| (1) | Total Shareholder Return (TSR) is the total return on common shares over a specified period, expressed as a percentage (calculated based on the change in stock price over the relevant measurement period and assuming reinvestment of dividends). Calculated as of December 31, 2023. |
| (2) | Source: Company internal data and The Nilson Report, February 2024. |
• 52 2024 PROXY STATEMENT Financial Performance 
| (1) | Refer to footnote 2 under “Financial Results” on page 1 for details regarding FX-adjusted information. |
| (2) | Diluted earnings per share represents net income, less (i) earnings allocated to participating share awards of $64 million, $57 million and $56 million for the years ended December 31, 2023, 2022 and 2021, respectively, (ii) dividends on preferred shares of $58 million, $57 million and $71 million for the years ended December 31, 2023, 2022 and 2021, respectively, and (iii) equity-related adjustments of $16 million related to the redemption of preferred shares for the year ended December 31, 2021. |
| (3) | Return on average equity (ROE) is calculated for the relevant periods by dividing the (i) net income for the period by (ii) average shareholders’ equity for the period. |
| –Excluding Costco-related revenues and the impact of foreign exchange, adjusted revenues rose by 8 percent for the full year2
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● | EPS:$2.97 on a reported basis and $5.87 excluding the impacts of the Tax Act, which was at the higher end of the increased guidance we gave at the end of the third quarter (earnings of $5.80 to $5.90 per share for the year) and above the initial guidance from the start of the year (EPS of $5.60 to $5.80).1
| ● | ROE:13.1 percent (adj. 25.4 percent1);
| ● | Total cards-in-force grew by more than 2.9 million;
| ● | Worldwide spending on our cards increased by 5 percent to a record $1.1 trillion;
| ● | Card Member loans rose 12 percent, significantly outpacing the industry; and
| ● | An additional 1.5 million new merchant locations-in-force in the United States.
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Our overall progress, along with the positive environment for equities, helped us deliver TSR of 36 percent for 2017. This compares favorably to returns of 22 percent for the S&P 500 and S&P Financials, and 21 percent as the median of our peer group (seepage 60 for a list of our peers).
1 |
Adjusted diluted EPS and adjusted ROE, both excluding the impacts of the Tax Act of $2.6 billion, are non-GAAP measures. The estimated impacts may be refined in the future as additional guidance and interpretations become available. See Annex B for a reconciliation to EPS and ROE on a GAAP basis.
| 2 | Adjusted revenues net of interest expense on an FX-adjusted basis, a non-GAAP measure, excludes from prior-year results estimated revenues from Costco in the United States, Costco U.S. cobrand Card Members and other merchants for out-of-store spend on the Costco cobrand card. Management believes revenues net of interest expense excluding estimated Costco-related revenues is useful in evaluating the ongoing operating performance of the Company following the end of the Costco U.S. relationship. See Annex B for a reconciliation to total revenues net of interest expense on a GAAP basis.
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2018 Proxy Statement Compensation Discussion and Analysis2024 PROXY STATEMENT 53 •
2023 Shareholder Engagement and Responsiveness to 2017 Say on Pay2023 Say-on-Pay Vote SHAREHOLDER OUTREACH AND ENGAGEMENT | | |  | |  | | | | 59% | | 40% | Outstanding Shares | | Actively Engaged and Responded | | | | | | | Following our 2023 Annual Meeting, we reached out to shareholders representing approximately 59% of our outstanding shares along with other stakeholders. | | Twenty-six of our shareholders, representing approximately 40% of our outstanding shares, and other stakeholders responded to our meeting request. |
We also made our Independent Directors available, including our Lead Independent Director, to participate in meetings with our shareholders. Additionally, in 2023, our Investor Relations team and members of Management met with 229 investment firms, analysts and other investors, which included shareholders representing approximately 51% of our outstanding shares. RESPONSIVENESS TO OUR 2023 SAY-ON-PAY VOTE At American Express, we value the feedback we receive from our shareholders. Our directors and managementManagement recognize the benefits that come from robust dialogue with shareholders and we therefore engage with our shareholders on an ongoing basis. We have made a number of executive compensation program updates to align the program with changes at the Companyother relevant parties and in response to shareholder feedback. We have provided a chart below with the items shareholders identified and actions the CBC took to ensure that we are responsive. Since January 2017, we have engaged with investors representing over 51 percent of shares outstanding on corporate governance, executive compensation and related matters.embraced an active year-round engagement strategy for many years. | What OUR FOCUS DURING THE 2023 SHAREHOLDER ENGAGEMENT SEASON WAS ON OBTAINING FEEDBACK ON OUR EXECUTIVE COMPENSATION PROGRAM Our Board was disappointed with the results of our 2023 Say-on-Pay vote (54% of votes cast in favor). In response, Management sought feedback through engagement meetings with our shareholders and reported the detailed feedback received to the Board. In general, the feedback we Heard | | Whatreceived from shareholders and other stakeholders on the design of our executive compensation program was supportive, consistent with the previously high level of support for our Say-on-Pay vote (approximately 96% and 95% of votes cast in favor at the 2022 and 2021 Annual Meetings of Shareholders, respectively). The majority of the feedback we Did | Questions about payreceived regarding the vote results was focused on the special award granted to Mr. Squeri in 2022, in which several shareholders expressed concerns with the quantum | | ✓We set a new CEO pay target at $16.2 million, reduced from $22 million for prior long-tenured CEO.
| Manage CBC discretion and clarifyperformance conditions. In addition, shareholders requested to better understand how it’s applied | | ✓We re-designed our annual incentive programAnnual Incentive Award (AIA) payouts are determined. In response, we have taken steps to reduce discretion for NEOsrespond to these concerns, as described in this section, with changes and enhanced CD&A disclosureenhancements to clarify how the CBC determines bonus payouts
| Linkages of strategy to program design | | ✓our disclosures. We will continue to alignengage with our compensation program with new CEO strategic prioritiesshareholders to solicit and consider feedback.
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We have detailed the key feedback we received from shareholders and other key stakeholders, along with the Company’s response on the following page.
• 54 2024 PROXY STATEMENT | | | | | | | What We Heard | | Our Response | Clarifications about pay metrics selection2022
Special Award | | The use of special awards is disfavored, particularly for the CEO | | ✓We enhanced the disclosure of our pay metrics, including targets for annual and long-term programshave committed that Mr. Squeri will not receive any future special awards | Consider | ✓No special awards are currently being considered for our other NEOs and none were made in 2023. After considering shareholder feedback on special awards, going forward, we expect they would only be used in extraordinary circumstances, if at all | | The award lacked sufficiently rigorous performance conditions or rationale that would have mitigated concerns, and the measurement period for Total Shareholder Return should have been for a longer period of time | | ✓ The 2022 Special Award contained performance and vesting conditions that are more rigorous than our annual equity awards, and option exercise restrictions that emphasized sustained long-term performance. If a special award is considered for any NEO in the future, it will include performance conditions that are more rigorous, and will require a longer measurement period to reward sustained performance | CEO Pay | | The pace of CEO pay increases in recent years has been elevated without sufficient rationale | | ✓No changes to peer groupCEO target pay for 2024 ✓ CEO pay is set based on a deliberate process by the Board’s Compensation and Benefits Committee which includes a review of the competitive market, as well as absolute and relative financial and strategic performance. See pages 61-62 for more details | | | ✓ As a part of its periodic review process, the CBC replaced one company in the peer group to more closely align our peer group The CEO’s 2023 pay adjustment aligned his target with the Company’s currentrevenue growth, EPS growth, and ROE in the top quartile relative to our compensation peers | Short-Term
Incentive Program | | Disclosure of how AIA goals are set and how performance is measured is limited, and it is difficult to assess how outcomes were achieved | | ✓We have enhanced our AIA disclosure, including additional detail on goal setting and performance determination on pages 59 and 63-65 | | Financial objectives/quantitative goals are weighted at less than 50% of the AIA scorecard | | ✓Beginning in 2024, financial objectives (Shareholder quadrant) will have an increased weighting from 45% to 60% of the AIA scorecard ✓ All four quadrants of the AIA scorecard have and will continue to be assessed against pre-established objective performance measures. See page 58 for more details | | Individual performance disclosures particularly on the individual multiplier require additional explanation | | ✓We have disclosed individual performance highlights that drove individual multiplier determinations on pages 66-68 ✓ Individual multipliers are determined based on a thorough review of each NEO’s quantitative and qualitative impact on our business model |
2024 PROXY STATEMENT 55 • CEO Total Direct Compensation The CEO’s 2023 total direct compensation decision is consistent with our pay-for-performance philosophy and focuses on variable and “at-risk” compensation that is closely aligned with Company performance and sensitive to the Company’s stock performance. The chart below shows that 96% of the CEO’s annual 2023 compensation is performance based with a significant portion (66%) tied to the future performance of the Company. 
The CEO’s compensation shown below reflects the target direct compensation for 2023 that was set at the start of 2023. It also shows actual total compensation for 2023 reflecting the Compensation and Benefits Committee’s compensation decisions in January 2024 that took into consideration 2023 Company and CEO performance and external positioning given performance and CEO experience. As shown below, 2023 actual compensation of $33.5 million is 13% above the 2023 target of $29.8 million and 1.7% below 2022 actual compensation of $34.1 million. 
52(1) | 2022 Actual reflects ongoing, annual compensation and excludes the 2022 Special Award granted in October 2022 in the amount of $15 million. |
• 56 2024 PROXY STATEMENT Section 2: Compensation Governance and Pay Principles Governance Practices The Company’s executive compensation program is overseen by the Compensation and Benefits Committee with the advice and support of the Company’s independent compensation consultant as well as the Company’s Management team. The following are key characteristics of the Company’s executive compensation program, which we believe best serve the interests of our shareholders and promote good governance. | | | | | | 2018 Proxy Statement | WHAT WE DO Our programs and practices continue to:  Link a significant portion of pay to business and stock performance
Employ robust goal-setting processes to align goals with Company strategy Bind cash incentives and equity awards to recoupment and forfeiture provisions Apply clawback provisions for all NEOs in the event of a restatement or detrimental conduct Recoup the CEO’s annual cash incentive award at the discretion of the Compensation and Benefits Committee if the Company does not achieve acceptable performance in the following year Discourage imprudent risk-taking, including by having the Chief Risk Officer review goals and results to confirm that actual results were achieved within the Company’s Risk Appetite Framework Maintain significant NEO stock ownership requirements Cap annual cash incentive payment for NEOs (187.5% of target for significant outperformance) Prohibit executive officers from hedging Company stock or margining or pledging shares Have double-trigger change-in-control provisions | | | | | WHAT WE DON’T DO Our programs and practices do not:  Pay dividends or dividend equivalents on Performance Restricted Stock Units granted to NEOs unless they vest
Provide excessive perquisites, benefits or severance benefits Make excise tax gross-ups upon a change-in-control Maintain individual employment agreements or change-in-control arrangements Reprice options | | |
Pay Principles We believe our executive compensation program is thoughtful, consistent and continues to align with the Company’s business strategies. | | | | | | | 
We align pay with Company
performance
to support a long-term,
high-performance business
model.
| | 
We link the majority of pay to
long-term business strategies
and key priorities
The CEO’s pay has added
emphasis on performance-based
incentives (96% of CEO’s pay)
with a substantial stock
ownership requirement.
| | 
We measure performance
against challenging goals,
including effective risk
management, established at the
start of each performance cycle
that are aligned with our key
business priorities.
| | 
We discourage
imprudent risk-taking
by avoiding undue
emphasis on any one metric
or short-term goal.
|
We continue to review our pay principles with input from shareholders and regulators, including the Board of Governors of the Federal Reserve System (Federal Reserve) and the Office of the Comptroller of the Currency (OCC).
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2024 PROXY STATEMENT 57 • Section 3: Compensation Discussion and Analysis2018 Proxy Statement Elements of Executive CompensationPrograms
The following table summarizes the key elements of our executive compensation program and demonstrates the program’s focus on annual and long-term incentive compensation that is closely aligned with Company performance and is sensitive to the Company’s stock performance. Base salaries correspond to experience The Compensation and job scopeBenefits Committee periodically reviews executive compensation and provide competitive fixed pay.
Annual Incentive Award (AIA)3 |
Performance Measures4
●Shareholder (55%)
●Customer (15%)
●Employee (15%)
●Strategic and Long-Term Sign-Posts (15%)
|
2017 Pay Outcomes Summarized: CEO Pay Decisions
The Company delivered strong performance in 2017 and the CBC concluded that Mr. Chenault has earned the maximum AIA (approximately $8.3 million) at 125 percent of target. This amount is paid in RSUs instead of cash to provide more emphasis on the Company’s stockmay recommend adjustments driven by market data, performance and the vesting of these RSUssituations where there is deferred until one year after his retirementa change in 2018. In addition, the CBC awarded the CEO a PG of $1.5 million in early 2018. PGs are a portion of long-term incentive compensation tied to three-year performance (in this case 2018-2020). In Mr. Chenault’s case, the long-term vesting of this award incentivized the appropriate balance of short/long-term performance during his final year, and aligned his 2017 compensation with the success of the ongoing strategic initiatives that are likely to drive performance in 2018 and beyond. Mr. Chenault did not receive any other long-term incentive award due to his retirement.responsibility:
Mr. Chenault’s compensation for 2017, other than his base salary, consisted of performance-contingent, multi-year awards tied to specific financial and operational goals. Seepage 62 for more information on Mr. Chenault’s compensation.
| 3 | | | | | | | | | | | | | | | Form of Payment | | Performance
Period | | Description of Compensation Component | | For More
Information | | | | | | Base Salary | | Historically, all or aCash
| | Ongoing | | ¾ The fixed portion of the AIA awardedtotal direct compensation ¾ Ensure appropriate balance between external market
practice and internal alignment for executives with a comparable
scope of responsibilities | | Page 58 | | | | | | Annual
Incentive
Award
(AIA) | | Cash | | One year | | ¾ Annual cash-denominated performance-based component of
executive compensation, designed to our CEO has been paid inrecognize Company
performance and individual performance ¾ Determined against a form other than cash and has been deferred. Mr. Chenault’s 2017 AIA was earned based on his 2017 performance, but allbalanced set of the payout was deferred into RSUs for one year. The PG is subject to achievement of three-year (2018-20) financialgoals across shareholder,
customer, colleague and strategic milestonescategories as well as
execution and risk management factors, approved by the CBC in Q1 2018,
Compensation and Benefits Committee | | Page 58 | | | | | | Long-Term
Incentive
Award
(LTIA) | | 80% Performance
Restricted Stock
Units (PRSUs) 
| | Three years | | ¾ Align incentives with shareholder interests and the PRSUs dependCompany’s
long-term financial objectives ¾ Granted annually with a 3-year cliff vesting period ¾ Vesting of awards contingent on 2018-20relative ROE performance. The SOs vest three yearsand relative TSR
performance versus a set of performance peers ¾ Dividends are accrued on the target number of shares and are
paid out after grant, subject to meeting performance conditions, and are exercisable for ten years. All or a portion of our CEO’s AIA earned for performance years 2010-2015 and 2017 was paid in RSUs with additional one-year vesting subject to positive net income. For most of these RSU awards, 50 percent of the net shares are to be held for one year post retirement. | | Page 60 | 4 | Details
20% Stock Options (SOs) 
| | Three years | | ¾ Align compensation earned with value shareholders receive over
the same period of time, and thereby incentivizing strong
sustained performance measures under each of the below categories can be found onpage 56.to maximize shareholder value creation | 5 | Average ROE between 23-27 percent provides 100 percent target payout. Details of the applicable payout grid are available onpage 58.
| 6 | Subject¾ Granted annually with a 3-year cliff vesting period and 10-year
total term
¾ Awards vest subject to positive cumulative net income over the vesting period.
3-year performance period |
| 53 |
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2018 Proxy Statement Compensation Discussion and Analysis
Compensation Governance Practices
The Company’s executive compensation program is governed independently by the CBC with the advice and support of the Company’s independent compensation consultant as well as the Company’s management team. The following are key characteristics of the Company’s executive compensation practices, which we believe promote good governance and best serve the interests of our shareholders:
✓ | Employ robust goal setting process to align CEO and NEO goals with Company strategy | ✓ | Cash incentives and equity awards subject to recoupment and forfeiture provisions | ✓ | Clawback provision for cash portion of the CEO’s AIA when AIA is paid in cash | ✓ | Program discourages imprudent risk taking, including Chief Risk Officer’s review of goals and results to confirm that actual results were achieved within the Company’s risk appetite | ✓ | Maintain significant NEO stock ownership requirements | ✓ | Cap on CEO annual incentive compensation payments (125 percent of target) | ✓ | Cap on NEO AIA payments (187.5 percent of target for extraordinary performance) | ✓ | Prohibit executive officers from hedging or pledging company stock | ✓ | Double-trigger change-in-control provisions | ✓ | No employment contracts with NEOs | ✓ | No payment of dividends or dividend equivalents on RSUs granted to NEOs until they vest | ✓ | No excise tax gross-ups upon a change in control | ✓ | No individual change in control arrangements | ✓ | No repricing of options |
Executive Compensation Principles and Strategy
Our executive pay program is deliberate, consistent and continues to align with our Company’s business strategy.
✓ | We align pay with Company performance and support a long-term, high performance business model. | ✓ | We link most of the pay for senior executives to long-term business strategies and key priorities. The CEO’s pay has added emphasis on performance-based incentives (91 percent of CEO’s target pay for 2017), with a substantial stockholding requirement (seepage 69 for details). | ✓ | We measure performance against challenging markers established before each performance cycle and aligned with our key business priorities. | ✓ | We discourage imprudent risk taking by avoiding undue emphasis on any one metric or short-term goal. |
These principles have served us well for many years, and we have adapted them in response to input from shareholders and regulators, including the Board of Governors of the Federal Reserve System (Federal Reserve).
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Compensation Discussion and Analysis2018 Proxy Statement
Elements of Total Direct Compensation
Each NEO’s TDC consists of three forms of compensation: base salary, AIA and long-term incentives. The annual and long-term incentives are variable and depend on the achievement of specific performance objectives.
Total Direct Compensation
TDC consists primarily of variable annual and long-term incentive pay. Variable compensation, which makes up most of NEO pay, covers annual and multi-year performance periods and depends on performance against comprehensive measures. Compensation for 2017 consisted of the following elements:
| Pay Component | | Rationale | | How it is Paid |  | Base Salary | | Provides competitive fixed pay to attract employees | | Paid in cash | Annual Incentive Award | | Incentivizes achievement of key annual objectives across the Company and specific business units, including progress made towards long-term initiatives | | Paid in cash
Historically, all or a portion of the AIA awarded to our CEO has been paid in a form other than cash and has been deferred
|  | Portfolio Grant | | Incentivizes achievement of specific financial objectives and strategic milestones, measured over a three-year period | | Paid in cash
Historically, all or a portion of CEO’s earned amount is deferred into RSUs to further link pay with future performance
| Performance RSUs | | Rewards for achievement of specific financial objectives, measured over a three-year period and links payout to stock price appreciation | | Paid in shares | Stock Options | | Aligns executives’ interest with long-term value creation as measured by appreciation in stock price | | Results in shares delivered upon exercise |
Compensation Alignment with Company Performance
The components of our executive compensation program demonstrate alignment with long-term shareholder value creation. CEO compensation is linked to the financial, strategic and operational performance of the Company. Ninety-one percent of the CEO’s compensation is performance-based and on average 88 percent of NEO compensation is performance-based.
2017 CEO Target Total Direct
Compensation Mix | | 2017 NEO Target Total Direct
Compensation Mix |  | |  |
| 55 Page 60 |
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2018 Proxy StatementCompensation Discussion and Analysis• 58 2024 PROXY STATEMENT
Base Salary Base Salary Each NEO received an annual salary in cash. The purpose of the base salary is the fixed portion of total direct compensation for our executive officers, including the NEOs. Salaries are set at a level to provide competitive fixed annual cash compensation.
AIA Structurepay reflective of an executive’s role, responsibilities and Methodology
The AIA is an annual cash-denominated performance-based component of executive compensation designed to recognize Company performance as well as exceptional individual performance. Performance is measured against measurable goals reviewedThe Compensation and approved by the CBC. The CBC believes each performance metric is a clear driverBenefits Committee periodically reviews salaries as part of annual Company performance and aligns with the Company’s focus on continued long-term value creation.total compensation reviews; salary increases are not automatic or guaranteed.
Annual Incentive Award (AIA) The AIA is structured to reflect specific and measureablemeasurable Company business unitgoals, approved by the Compensation and individual performance goals,Benefits Committee at the beginning of the year, including key objectives in four categories: Shareholder, Customer, Colleague and Strategic. The Committee believes each performance metric is a key driver of Company performance and directly linked to shareholder value creation. The Committee uses the same Company Scorecard to determine annual incentives for all executives to promote an enterprise-wide focus. The 2023 Company Scorecard below is based on the following categories.metrics with intra-category metric weightings detailed for transparency: | | | | | | | | | SHAREHOLDER | | Weighting | | Metric | | CUSTOMER | |  | Annual
IncentiveFocuses on performance against our financial objectives and continuously driving value for our shareholders • Revenue Growth (50%) • Earnings per Share (25%) • Return on Equity (25%) | | 55%
| | | ●Shareholder (e.g., EPS | Emphasizes the importance of maintaining and Revenue Growth)building our relationships with customers across our integrated payments platform • Net Promoter Score (33%) • Retention (33%) • Merchant Locations (33%) | | 
| | 15% | | | | ●Customer (e.g., Net Promoter Score)
| | | | | | | | | | | | | COLLEAGUE | |  | | | | STRATEGIC | |  | Focuses on building, retaining and motivating a best-in-class team necessary to execute our financial and strategic objectives • Talent Retention (33%) • Culture (33%) • Diversity Representation (33%) | 15% |
| ●Employee (e.g., Diversity
| | | Maintains focus on accomplishments related to our long-term goals and Inclusion Goals)sustainable shareholder value creation with specific objectives relating to the following: • Expand leadership in the premium consumer space • Build on our strong position in commercial payments • Strengthen our global, integrated network to provide unique value • Continue to uplift the control and compliance environment across the enterprise • Continue to progress on key ESG goals | | 
| | 15% | | | | ●
| | | |
| 2024 AIA PROGRAM UPDATES The Compensation and Benefits Committee periodically reviews executive compensation practices and makes adjustments. In response to our 2023 Say-on-Pay vote and to improve our compensation practices, beginning in 2024, the Compensation and Benefits Committee increased the weighting of our Shareholder quadrant (i.e., financial objectives) from 45% to 60%, increasing the weight towards quantifiable financial objectives. As a result, the weightings for our other quadrants will shift to the following: Customer (10%), Colleague (10%), and Strategic and Long-Term Sign-Posts (e.g., Merchant Coverage, Lending Growth)(20%). |
2024 PROXY STATEMENT 59 • In response to shareholder feedback for 2017, we simplified ourdetermining AIA program. It is now a more formulaic program thatpayouts, the Compensation and Benefits Committee considers quantitativeCompany performance against goals set at the beginning of the fiscal year in light of the relative context and based on general guidelines, along with individual performance, to determine the final payout.performance. The design works as follows for each NEO.NEO, although implied payout ranges are based on the Committee’s assessment and in no case may the multiplier exceed 150% of the target: 
Table
Company Performance In assessing Company performance for our AIA, the Compensation and Benefits Committee considers performance of Contents Compensation Discussionmetrics in the Shareholder, Customer and Analysis2018 Proxy Statement
Individual Target Amount.AtColleague categories, as well as the quantitative and qualitative impact of accomplishments in the Strategic category. Performance of metrics are evaluated relative to a 100% AIA achievement level. These 100% AIA achievement levels are set at the beginning of the fiscal year and represent the CBC reviewsperformance needed for Management to achieve target AIA payout. The performance of any single metric or category does not, itself, result in the achievement of a 100% Company Multiplier. Rather, the performance outcome ratings across all metrics and setscategories are weighted to arrive at an overall company performance outcome. Based on this aggregate performance outcome, and in context of the target annual incentive amountmacroeconomic environment, the Compensation and Benefits Committee assigns a payout multiplier on a scale from “Well Below” (Committee Discretion, <70%) to “Significantly Outperform” (150%).
See the “2023 Performance Multiplier – Company” section on page 63 for more information. Individual Performance In determining each NEO’s individual performance multiplier, the Compensation and Benefits Committee considers the CEO’s assessment of each NEO’s performance relative to their individual leadership contributions, as well as key quantitative and qualitative accomplishments. In addition, the Committee considers how each executive officers at a level intended to reflect their roleembodied American Express’ Blue Box Values and responsibilities. Generally, these targets do not change unless roles, responsibilities, or market circumstances change in such a way that an adjustment would be appropriate. Performance Multiplier.Leadership Behaviors (Setting the Agenda, Bring Others With You and Doing It the Right Way). The CEO’s individual performance multiplier is compriseddetermined through a formal annual review process, including the development of specificformal objectives at the beginning of each year, and measureable Company and business components. Company performance is weighted at 70 percent and business unit performance is weighted at 30 percent, other than for the CEO, whose AIA payout is based 100 percentsolicitation of formal feedback from each independent director on Company and individual performance and capped at 125 percent of target. The program places higher emphasis (70 percent) on Company performance to reinforce the importance of enterprise level success over individual business unit performance. Early in the year, the CBC approves performance objectives against which performance is assessed and a multiplier is appliedour Board at the end of each year.
See the year. To determine the Company and business unit portions of the multiplier, at the end of the year the CBC considers performance year assessments with input from the CEO“2023 Performance Multiplier – Individual” section on overall Company and business unit performance against these goals, as well as input from the Chief Risk Officer on organizational performance against established risk metrics.pages 66-68 for more information. Using these inputs, the CBC approves a Goal (G) rating for both the Company and business unit portions of the multiplier. The weighted sum of the multiplier for each of the Company and business unit performance elements corresponds to an overall performance multiplier used to calculate a payout.
Individual Multiplier.The individual multiplier allows the CBC to modify an award downwards or upwards to consider individual performance, including quality of results, key leadership attributes, compliance with risk and control objectives and other relevant factors.
Long-Term Incentive Award Structure and Calculation• 60 2024 PROXY STATEMENT
The
Long-Term Incentive Award (LTIA) is intended to be formulaic and link compensation to the achievement of long-term financial objectives. Our LTIA compensation is awarded in three forms: portfolio grant (PG), performance restricted stock units (PRSUs), and stock options. Each of these incentives aligns NEOs’ interests with those of shareholders and establishes retention incentives through multi-year, performance-based vesting periods. The elements of the Company’s LTIA and their respective features are described in the below table:table below: | | | | | | | | Element | | Key Metrics | | Features | | Portfolio Grant(1) | | Performance Restricted Stock Units (80% of award) | | ●¾3-year financial and strategic goals ¾ 3-year TSR compared to the same performance peers as ROE | | ● period¾Payout tied to 3-year relative performance ●0-125% and stock price
performance¾ 0-120% of target payout range | Performance RSUs | | ●3-year average ROE
| | ●3-year vesting period
●Payout tied to 3-year performance
●0-125% of target payout range
| Stock Options | | ●Stock price appreciation(2)
| | ●Vests 3 years after grant
●10-year term
|
(1) | shares awarded Ordinarily paid in cash at the end of the three-year performance period, but the CEO’s earned amount has been paid in RSUs since 2011 including awards earned at the end of 2017
| (2)Stock Options (20% of award) | | Subject
¾ Positive cumulative net income | | ¾ 3-year cliff vesting period ¾ Vests subject to positive cumulative net income over the vesting3-year
performance period ¾ 10-year term |
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2018 Proxy Statement Compensation Discussion and Analysis
Portfolio Grant
The PG is a form of long-term compensation primarily paid in cash. The size of the grant that is awarded as part of TDC for a given year is determined by performance during the prior fiscal year, with the ultimate earned value of the award based on performance on relevant financial and strategic metrics at the end of the three-year performance cycle. For 2018-2020, the CBC set financial and strategic milestones in the first quarter of 2018 for the three-year performance period ending in 2020. The CBC sets targets for portfolio grants that are intended to be rigorous yet achievable through sustainable long-term performance, as demonstrated by the 2015-2017 grant which paid out below target.
For 2017 (reflecting performance for the 2015-2017 period), all PGs were paid in cash other than for the CEO, whose grant was paid in RSUs to further link CEO compensation to future performance and ultimately shareholder returns. This element of compensation closely aligns executive compensation to the Company’s long-term financial and strategic performance through measurable goals. The Company discloses actual structure and goals only at the end of each performance cycle due to the competitively sensitive nature of the information. See the “Portfolio Grant Awarded in January 2015-Vesting Based on 2015-2017 Performance” section for the discussion of the 2015-2017 PG metrics and pay outcomes.
Performance Restricted Stock Units (PRSUs)(PRSU) As a financial institution with a loan portfolio and fee income, we consider effective returns on capital to be a validation of high performance. The program requires top-quartile relative ROE for PRSUs to pay out at target, and above target payouts are a form of equity compensation dependentcontingent on Total Shareholder Return (TSR) performance being in the achievement of specific financial goals and linked to the long-term performance of the Company. This element of compensation closely aligns executives to the Company’s financial performance achievements and stock price appreciation over the long term. PRSUs are earned for the achievement of ROE targets with the actual value based on the stock price at the time of the payout, thus linking the award closely to stock performance. ROE was chosen as the metric because it is an important measure of the financial successtop third of our business and is commonpeer group regardless of our ROE performance. Median relative ROE performance results in the financial services industry.an 80% payout. At the PRSU grant date, the CBC determines the three-year average ROE target for the grant’s three-year performance cycle. The target is set considering the Company’s operating plan and is intended to incentivize performance that is challenging yet achievable. As detailed in the table below, the percent of the PRSUs that are earned by an NEO can range from 0 percent to 125 percent of target, contingent upon performance:
| % Target Shares Granted | | 3-Year Average ROE | | | 125 | % | | | | >=30 | % | | | 108.3 | % | | | | 28 | % | | | 100 | % | | | | 23 – 27 | % | | | 95 | % | | | | 22 | % | | | 75 | % | | | | 20 | % | | | 0 | % | | | | <=5 | % | |
Note: If the three-year ROE is between two points, straight-line interpolation will be applied.
| 58 | | | | | | | | | | | | | | | | | AXP Relative ROE Performance(1) | 2018 Proxy Statement |
Table of Contents
Compensation Discussion and Analysis2018 Proxy Statement
The Compensation Process
Evaluating Performance: Selecting Metrics, Setting Targets
The CBC reviews and approves comprehensive performance goals annually and remains actively engaged throughout the year to monitor Company strategy and performance toward goals. The following describes the Company’s process for selecting incentive program metrics and setting challenging yet achievable targets that are aligned with the Company’s strategic direction.
Payout%(2) | | | Key Steps in Selecting Incentive Metrics and Setting Targets | Modifier: AXP Relative TSR Performance(1) | | Impact to
Payout% | | |  | | | | ≥90th percentile | Our Board reviews the competitive environment and business strategy throughout the year, including regulatory, competitive and technological developments. | | 120 | % | | & | | 67th Percentile or better of LTIA Performance Peer Group | | | None(3) | | 75th percentile | The CBC reviews and approves final incentive plan metrics and goals early in each year. | | 100 | % |  50th percentile | The CBC remains engaged throughout | | 80 | % | | < 67th Percentile of LTIA Performance Peer Group | | | Cap at 100% | | 25th percentile | | | 50 | % | <25th percentile | | | 0 | % | | | | | | |
| (1) | Relative to the year, evaluates annual performance and determines final payout amounts based on the achievement of stretch goals.LTIA Performance Peer Group. |
| (2) | Straight-line interpolation applies if performance is between two points. |
| (3) | Relative TSR Performance in the 67th Percentile or better will not impact the relative ROE Performance payout and can payout up to 120%. |
| | | | | | | | | | | | | LTIA Performance Peers For the purposes of comparing our ROE and TSR performance, we have an LTIA performance peer group. This group consists of 20 companies subject to the Federal Reserve’s Comprehensive Capital Analysis and Review (CCAR). CCAR participating companies are included for performance comparisons as: ¾ They provide an applicable comparator group determined through an objective screening process ¾ They, like American Express, are subject to annual capital planning requirements as part of their CCAR reviews ¾ They have largely similar macroeconomic sensitivities as American Express In addition to these companies, we also include three payments competitors, Mastercard, PayPal and Visa. | | | | | | | | | | | ¾ Bank of America | | ¾ Fifth Third Bancorp | | ¾ M&T Bank | | ¾ State Street | | | | | | | | | | | ¾ BNY Mellon | | ¾ Goldman Sachs | | ¾ Morgan Stanley | | ¾ Truist Financial | | | | | | | | | | | ¾ Capital One Financial | | ¾ Huntington Bancshares | | ¾ Northern Trust | | ¾ U.S. Bancorp | | | | | | | | | | | ¾ Citigroup | | ¾ JPMorgan Chase | | ¾ PayPal | | ¾ Visa | | | | | | | | | | | ¾ Citizens Financial Group | | ¾ KeyCorp | | ¾ PNC Financial Services Group | | ¾ Wells Fargo | | | | | | | | | | | ¾ Discover | | ¾ Mastercard | | ¾ Regions Financial | | | | | | | | | | | | | | | | | | | | | |
2024 PROXY STATEMENT 61 • Section 4: Compensation Determination Process Annual Compensation and Decision-Making Process Our Compensation and Benefits Committee is responsible for assisting the Board in its oversight responsibilities related to executive compensation programs, including determining the payouts for the last completed fiscal year and setting the annual performance goals for the upcoming performance cycle for each of our executive officers including the CEO. Typically, the Compensation and Benefits Committee follows the key activities outlined below: 
Peer Group and Benchmarking Our pay program is designed to reward achievement of financial and strategic goals and to attract, retain and motivate our leaders in a competitive talent market. The CBCCompensation and Benefits Committee periodically examines pay practices and pay data for a groupCompensation Peer Group of 20 companies as a source of benchmarking data to better understand the competitiveness of our compensation program and its various elements. While the benchmarking data is used to assess the competitiveness of our compensation program, it is only one of a number of factors used to make final pay decisions. The Compensation Peer Group is different than our LTIA Performance Peer Group which is selected for industry and financial metric comparability to assess our relative financial performance in determining potential LTIA vesting. How We Select the Company’s PeersCompensation Peer Group In selecting the current peer group,Compensation Peer Group, the CBCCompensation and Benefits Committee identified prominent S&P 500 companies, generally with revenue levels similar to ours, and the companies fall intoin the following categories:categories we primarily compete for talent with: (1) financial institutions; (2) iconic global consumer brands; and (3) payments related and technology businesses. The Committee, together with its independent compensation consultant, periodically reviews the Compensation Peer Group. For 2023, this group remained consistent with the group used for the past seven years. In 2017,
| | | | | | | | | | | | | | | | | | | Compensation Peer Group for 2023 | | | | | | | | | | | | | | | | | | | | Financial Institutions ¾ Bank of America ¾ BNY Mellon ¾ BlackRock ¾ Capital One Financial ¾ Citigroup ¾ Goldman Sachs ¾ JPMorgan Chase ¾ Morgan Stanley ¾ U.S. Bancorp ¾ Wells Fargo | | | | | | Iconic Global Consumer Brands ¾ Coca-Cola ¾ Colgate-Palmolive ¾ Nike ¾ PepsiCo ¾ Starbucks | | | | | | Payment & Technology Businesses ¾ Cisco ¾ Discover ¾ Mastercard ¾ PayPal ¾ Visa | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
• 62 2024 PROXY STATEMENT Role of the Independent Compensation Consultant The Compensation and Benefits Committee is composed solely of independent directors. The Committee is responsible for approving our executive officer compensation decisions. It has retained Semler Brossy as partits independent compensation consultant to provide counsel on various compensation-related matters, including peer group selection and competitive market assessment, market insights and trends in executive compensation and Management’s proposed levels of its routine reviewcompensation. The Committee held six meetings over the course of 2023, all of which ended with executive sessions without Management present. During 2023, Semler Brossy attended Compensation and Benefits Committee and American Express National Bank board meetings, including certain executive sessions, and provided compensation advice independent of the Company’s compensation peer group,Management. Semler Brossy does not engage in other work for the CBC evaluatedCompany. The Committee assessed the appropriatenessindependence of the peer groupSemler Brossy pursuant to SEC rules and maintained the same categories as mentioned above. The CBC decided to remove Walt Disney from the peer group upon considerationconcluded that their work did not raise any conflicts of shareholder feedback, and added the Starbucks Corporation as a comparable peer with similar brand characteristics and revenues. The remainder of the group was unchanged.interest. |
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2018 Proxy Statement 2024 PROXY STATEMENT 63 •
Section 5: 2023 Compensation Discussion and Analysis Comparator Group 2017
Financial
Institutions | | Iconic Global
Consumer Brands | | Payments Related
& Technology Businesses | Bank of America | | Goldman Sachs | | Coca-Cola | | PepsiCo | | Discover | | PayPal | BNY Mellon | | JPMorgan Chase | | Colgate Palmolive | | Starbucks | | MasterCard | | Cisco | BlackRock | | Morgan Stanley | | Nike | | | | Visa | | | Capital One Financial | | US Bancorp | | | | | | | | | Citigroup | | Wells Fargo | | | | | | | | |
Pay Decisions Performance and Outcomes for 2017
The following2023 Annual Incentive Award
2023 Performance Multiplier – Company As described in the AIA overview section, discussesthe Company Performance Multiplier is determined based upon performance against key incentive program metrics as well as the pay decisions and outcomes for each NEO. As a part of the annual pay decision process, the CBC considers overall Company performance as well as performance against specific pre-established enterprise-wide goals, performancein four categories. Performance is evaluated relative to our peers and financial markets, and a risk/control and compliance assessment. Progress on Key Performance Metrics in 2017
Two years ago, we identified three priorities for 2016-17 to transform our business in the face of renewed competition, a shifting regulatory environment, and disruptive technological changes:
● | Accelerating Revenue Growth | ● | Optimizing Investments | ● | Resetting the cost base |
As we executed on this plan, we added new products and benefits for both consumers and businesses, including a refresh of our U.S. Platinum Card. At the same time, we redesigned our marketing, customer service and risk management capabilities with a leaner, more agile technology infrastructure and cutting-edge data science. As a result of these actions, in 2017:
● | Total cards-in-force grew by more than 2.9 million; | ● | Worldwide spending on our cards increased by 5 percent to a record $1.1 trillion; | ● | Card Member loans rose 12 percent, significantly outpacing the industry; and | ● | An additional 1.5 million new merchant locations-in-force in the United States. |
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The Company’s progress is also evidenced by the following:
| | 2016 | | 2017 | | Key 2017 Achievements | Revenue
(in billions) | | $32.1 | | $33.5 | | ●Total revenues rose 4 percent in 2017, even though the prior year included two quarters of revenue from our Costco relationship. ●Excluding Costco-related revenues and the impact of foreign exchange, adjusted revenues rose by 8 percent for the full year7 ●Fourth quarter Revenue Exit Momentum of 10 percent8 ●Billings growth in our consumer and commercial businesses, higher net interest income from loan growth, and higher fee income | Total Loans9
(in billions) | | $66.7 | | $76.1 | | ●Credit quality stayed strong throughout the year ●Economics of lending remain very attractive to us considering the benefits of higher net interest income. | | ROE | | 26.0% | | 13.1%
(adj. 25.4%)10 | | ●Excluding the impacts of the Tax Act, ROE was in line with our historical experience | | EPS | | $5.65
(adj. $5.93)11 | | $2.97
(adj. $5.87)10 | | ●Excluding the impacts of the Tax Act, EPS was $5.87 which was in line with the guidance we offered in October 2017 ($5.80 to $5.90) and above the initial guidance from the start of the year (EPS of $5.60 to $5.80). |
The Company’s TSR for 2017 was 36 percent12. Overall the Company’s TSR outperformed the S&P Financials and S&P 500 indices on a one-year basis, but lagged these indices on a three- and five-year basis.
7 | Adjusted revenues net of interest expense on an FX-adjusted basis, a non-GAAP measure, excludes from prior-year results estimated revenues from Costco in the United States, Costco U.S. cobrand Card Members and other merchants for out-of-store spend on the Costco cobrand card. Management believes revenues net of interest expense excluding estimated Costco-related revenues is useful in evaluating the ongoing operating performance of the company following the end of the Costco U.S. relationship. See Annex B for a reconciliation to total revenues net of interest expense on a GAAP basis.
| 8 | Fourth quarter Revenue Exit Momentum is our Fourth Quarter 2017 revenue growth over the prior year.
| 9 | Total loans represents Card Member loans and Other Loans.
| 10 | Adjusted diluted EPS and adjusted ROE, both excluding the impacts of the Tax Act of $2.6 billion, are non-GAAP measures. The estimated impacts may be refined in the future as additional guidance and interpretations become available. See Annex B for a reconciliation to EPS and ROE on a GAAP basis.
| 11 | Adjusted diluted EPS, a non-GAAP measure, excludes the $266 million after-tax restructuring charges ($410 million pre-tax) from 2016. See Annex B for a reconciliation to EPS on a GAAP basis.
| 12 | TSR is the total return on common shares over a specified period, expressed as a percentage (calculated based on the change in stock price over the relevant measurement period and assuming reinvestment of dividends). Source: Bloomberg (returns compounded daily).
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Compensation Analysis and Key Determinations for 2017
CEO TDC Decisions for 2017
The Company delivered strong performance in 2017 and the CBC concluded that Mr. Chenault has earned maximum100% AIA (approximately $8.3 million) at 125 percent of target. This amount is paid in RSUs instead of cash to provide more emphasis on the Company’s stock performance, and the vesting of these RSUs is deferred until one year after his retirement in 2018. In addition, the CBC awarded Mr. Chenault a PG of $1.5 million in early 2018. PGachievement levels, which are a portion of long-term incentive compensation tied to three-year performance (in this case 2018-2020). In Mr. Chenault’s case, the long-term vesting of this award incentivized the appropriate balance of short/long-term performance during his final year, and aligned his 2017 compensation with the success of the ongoing strategic initiatives that are likely to drive performance in 2018 and beyond. Mr. Chenault did not receive any other long-term incentive award due to his retirement.
Mr. Chenault’s compensation for 2017, other than his base salary, consisted of performance-contingent, multi-year awards tied to specific financial and operational goals.
In millions:
83 percent of TDC awarded for 2017 is deferred and tied to future Company performance. |
Transitional Compensation Related to CEO Succession
Considering Mr. Chenault’s retirement on February 1, 2018, the CBC decided that his 2018 annual incentive for the duration of his service in 2018 until his retirement will also be paid at target in 2019 on a pro-rata basis.
On January 22, 2018, the CBC approved certain arrangements for Mr. Chenault. We have agreed to provide an annual stipend of $300,000 per year to Mr. Chenault for office space with administrative support for use after retirement (consistent with past practice for retiring CEOs) for a period of nine years (the year Mr. Chenault becomes age 75), with an additional one-time set-up payment of $500,000 plus appropriate office hardware on a one-time basis. We have also agreed to provide Mr. Chenault with driver support for security for one year.
On October 18, 2017, following the announcement of Mr. Chenault’s retirement and the decision to appoint Mr. Squeriset as CEO, the CBC awarded Mr. Squeri performance-vesting options on October 31, 2017 with a grant date fair value of $4.5 million in connection with his promotion. On the same date, Mr. Buckminster was also granted performance-vesting
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Compensation Discussion and Analysis2018 Proxy Statement
stock options with a grant date fair value of $2.25 million, in connection with the CEO transition. The options will have a term of seven years, an exercise price equal to the closing price on the grant date and vesting subject to (i) a stock price goal of 30 percent above the closing price on the grant date, which must be met for a period of 20 consecutive trading days during the five-year period beginning on the grant date, (ii) a financial goal of positive cumulative GAAP net income for the three-year period and (iii) a three-year service condition. Fifty percent of the net after-tax shares received upon exercise must be held for at least 12 months.
Other NEOs’ Total Direct Compensation Decisions for 2017
The CBCs TDC decisions for the NEOs other than the CEO for performance year 2017 are presented in the table below ($000s)13:
| | S. J. Squeri | | J.C. Campbell | | D.E. Buckminster | | L.E. Seeger | | Base Salary | | $ | 1,500 | | $ | 1,000 | | $ | 750 | | $ | 800 | | AIA* | | $ | 7,000 | | $ | 4,600 | | $ | 3,350 | | $ | 2,400 | | PG | | $ | 2,700 | | $ | 1,500 | | $ | 1,300 | | $ | 1,100 | | PRSUs | | $ | 6,000 | | $ | 2,721 | | $ | 1,787 | | $ | 1,624 | | SOs | | $ | 1,500 | | $ | 629 | | $ | 413 | | $ | 376 | | TDC | | $ | 18,700 | | $ | 10,450 | | $ | 7,600 | | $ | 6,300 |
* | To comply with regulatory guidance that at least 50 percent of incentive compensation be deferred, $200,000 of Mr. Buckminster’s 2017 AIA and $850,000 of Mr. Campbell’s 2017 AIA were paid in the form of PRSUs and SOs granted in January 2018. The AIA figures in the above table reflect these adjustments. |
A significant portion of the NEOs’ Awarded TDC is tied to future performance of the Company,
including stock price performance14.
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AIA Outcomes for 2017
Executives are eligible to receive an AIA based on performance over the prior year against measurable goals that are setgeneral guidelines at the beginning of the year and approved by the CBCthen assessed in four key areas: Shareholder, Customer, Employee, and Strategic and Long-Term goals. AIA metrics are measures of Company and executive performance intended to drive the creation of long-term value. The CBC follows a detailed framework to set goals, assess performance and determine each NEO’s AIA payout.
NEO AIA Targets for 2017
At the beginninglight of the fiscal year, the CBC reviews and sets the target annual incentive amount for executive officers at a level intendedrelative context of actual performance.
In response to reflect their role and responsibilities. Generally, these targets do not change unless roles, responsibilities, or market circumstances change in such a way that an adjustment would be appropriate. The payout ranges up to 187.5 percent of target for NEOs based on a comparison of annual incentive structures for peer companiesour 2023 Say-on-Pay vote, and to reflectimprove our compensation practices, we have sought to enhance our disclosures regarding how AIA outcomes are determined. Therefore, we present our 100% AIA achievement levels for evaluation metrics below. For the Company’sShareholder quadrant, in addition to presenting our 100% AIA achievement level, we are presenting a new comparative historical industry benchmark to give additional context for our performance. While all four categories are assessed against pre-established 100% AIA achievement levels, certain elements within the Customer and executive extraordinary performance15.Colleague categories contain highly sensitive goals; the disclosure of which could cause significant competitive harm to American Express; in these instances, we have provided a summary. Earned awards are typically paid out in cash but the CBC can determine to pay awards in RSUs or a combination of the two for the CEO. For example, the CEO’s 2016 AIA was paid in long-term incentives considering progress needed beyond 2016 to reset the Company’s trajectory towards profitable growthThe Compensation and high returns.
13 | Due to SEC reporting rules, timing and other differences result in different amounts being allocated in the chart above as compared to the Summary Compensation Table. A reconciliation is shown onpage 73.
| 14 | The NEOs’ PRSUs are earned based on three-year average (2018-2020) ROE performance. With respect to equity awarded to Other NEOs (noted above), an equal number of shares were granted in the form of PRSUs and SOs, other than for Mr. Squeri.
| 15 | A 125 percent CEO cap that applied to Mr. Chenault’s AIA was removed in connection with the 2018 CEO transition.
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2017 Performance Outcomes
The CBC assigned a G1 rating to the Company after reviewing actual performance against target performance, for exceptional performance (seepage 56 for more information on the Company’s rating system). For all NEOs except the CEO, AIA payouts are based on a Performance Multiplier (measured 70 percent on Company performance and 30 percent on the appropriate business unit performance for each NEO) and an Individual Performance Multiplier. The CEO’s AIA payout is based 100 percent on Company performance as represented in the Company Scorecard shown below.
PERFORMANCE MULTIPLIER – COMPANY
In determining the annual Company portion of the Performance Multiplier, the CBCBenefits Committee evaluated the following results for all NEOs:
| | | | | | | | | Shareholder (45%) | | | | This category focuses on financial performance and driving value for our shareholders. The 100% AIA achievement levels for the 2023 Shareholder category were set above comparative historical industry performance in anticipation of macroeconomic tailwinds from post-pandemic growth in the early part of the year. To drive differentiated shareholder value creation, we aspire to outperform the 100% AIA achievement levels. See our 2023 Annual Report on Form 10-K for full discussion of the Company’s financial performance. | | | | | Metric (intra-category weight) | | Link to Shareholder Value | | Comparative
Historical
Industry
Benchmark(1) | | 2023 Performance Summary | | | | | Revenue Growth (50%) | | Delivering high levels of revenue growth on a sustainable basis is a key driver of the Company’s growth plan. | | 6% | | 
| | | | | EPS (25%) | | Reflects the Company’s overall financial performance, including our focus on driving expense efficiencies and our prudent approach to risk management. | | 10%
| |  | | | | | ROE (25%) | | Maintaining the Company’s industry-leading ROE creates value for our shareholders and incentivizes disciplined capital deployment. | | Mid-teens | | 
|
| (1) | Comparative historical industry benchmark informed by median compound annual growth rates (CAGR) for the years 2017 to 2022. |
| (2) | Refer to footnote 2 under “Financial Results” on page 1 for details regarding FX-adjusted information. |
• 64 2024 PROXY STATEMENT | | | | | | | | | | | Customer (15%) | | | | This category emphasizes the importance of maintaining and building relationships with customers across our integrated payments platform. The 100% AIA achievement levels for the Customer category are set at levels that maintain strong engagement with our customers, which can lead to higher billed business, revenue and earnings. While the Compensation and Benefits Committee evaluates performance against pre-established 100% AIA achievement levels for this category, certain elements contain highly sensitive information. Therefore, the 100% AIA achievement levels below are summarized to avoid competitive harm to American Express. | | | | | | Metric (intra-category weight) | | Link to Our Customers | | 100% AIA
Achievement Level | | 2023 Performance | | Performance
Outcome | | | | | | Net Promoter Score (33%) | | Our Net Promoter Score (NPS) measures the level of customer advocacy for American Express products and services. We believe this proprietary metric is an indication of our ability to maintain strong relationships with both our Card Members and Merchants. | | Maintain
strong 2022 performance | | Maintained
strong
outcomes
consistent
with 2022
levels | | 100% Achievement Level | | | | | | Retention (33%) | | Retention measures our ability to maintain engagement with our Card Members and drives our ability to grow our Billed Business with our existing Card Members. | | Mid-90% | | High 90% | | Significantly Outperform | | | | | | Merchant Locations (33%) | | Our ability to expand our accepting merchant locations is critical to sustaining virtual parity coverage in the U.S. and continuing to grow international coverage. | | Grow by ~5% | | >5% | | Significantly Outperform |
| | | | | | | | | | | Colleague (15%) | | | | This category focuses on building, retaining and motivating a best-in-class team to achieve our financial and strategic objectives. The 100% AIA achievement levels for the Colleague category are set at levels that support our ability to build, retain and motivate a strong and diverse workforce and drive productivity, revenue, innovation and resilience. While the Compensation and Benefits Committee evaluates performance against pre-established 100% AIA achievement levels for this category, certain elements contain highly sensitive information. Therefore, the 100% AIA achievement levels below are summarized to avoid competitive harm to American Express. | | | | | | Metric (intra-category weight) | | Link to Enterprise Value | | 100% AIA Achievement
Level | | 2023 Performance | | Performance
Outcome | | | | | | Talent Retention (33%) | | Retaining high performing and high potential talent enables implementation of our strategic business objectives | | Achieve top-talent retention in line with historical retention across our Business Units | | Retained top talent
significantly above
historical retention rates
across Business Units
and above external
benchmarks | | Significantly
Outperform | | | | | | Culture (33%) | | Promoting a strong Company culture through high levels of colleague engagement and inclusion helps our colleagues feel supported and backed to successfully execute our business strategies | | Maintain strong colleague engagement favorability and inclusion in line with external benchmarks | | Achieved exceptional
colleague engagement
survey results well above
external benchmarks,
indicating continued
strong Company culture
and reinforcing our
colleagues’ connection
to the Company’s Blue
Box Values | | Significantly
Outperform |
2024 PROXY STATEMENT 65 • | | | | | | | | | | | Colleague (15%) | | | | | | | | Metric (intra-category weight) | | Link to Enterprise Value | | 100% AIA Achievement
Level | | 2023
Performance | | Performance
Outcome | | | | | | Diversity (33%) | | Increasing underrepresented segments across the Company, where appropriate, supports a diverse, equitable and inclusive workforce and promotes stronger business outcomes through diverse perspectives | | Maintain progress toward diverse representation across the Company through expanded sourcing of candidates and development and retention of high potential talent | | Advanced diverse
representation
across levels to
support our
long-term vision of
maintaining a
diverse and
inclusive
workforce which
contributes to our
Company’s
success | | Outperform
|
| | | | | Strategic 25% | | | | | This category focuses on accomplishments related to our long-term strategic goals and sustainable shareholder value creation. For the Strategic category, 100% AIA achievement represents continued progress toward the strategic objectives we set at the beginning of 2023. Selected achievements are presented below. | | Performance Outcome | | Significantly Outperform | | Expand leadership in the premium consumer space. • 10% U.S. Consumer Services billed business growth • 17% International Consumer FX-adjusted billed business growth(1) • Continued to drive generational relevance, with over 60% of global proprietary consumer card acquisitions from Millennial & Gen-Z customers • Invested in enhanced benefits across card products, and extended enterprise wide partnership with Hilton • Strengthened our membership experience offering with the launch of the Centurion New York lounge Build on our strong position in commercial payments. • #1 U.S. Small Business Issuer by volume(2) • 19% International SME & Large Corporate FX-adjusted billed business growth(1) • Maintained strong new account acquisitions and customer retention • Relaunched our U.S. Business Gold card with an enhanced value proposition • Launched Business Blueprint, a digital platform to help small businesses run their business Strengthen our global, integrated network to provide unique value. • Maintained virtual parity coverage in the U.S., with approximately 99% of credit-card accepting merchants able to accept American Express(3), and continued to grow international coverage • Continued progress against our goal of 75% coverage in priority cities outside of the U.S. Continue to uplift the control and compliance environment across the enterprise. • Risk profile, performance and risk-taking remained within risk appetite • Global write-off and delinquency rates for Card Member loans and receivables remained strong, below pre-pandemic levels • Continued to invest appropriately in managing known and emerging risks Continue to progress on key ESG goals. • We have achieved or exceeded many of the ESG goals we set in 2021 • Continued progress on our preparation for sustainability reporting, to adapt to the evolving regulatory landscape for disclosures |
| (1) | Refer to footnote 2 under “Financial Results” on page 1 for details regarding FX-adjusted information. |
| (2) | Source: The Nilson Report, June 2023 “Small Business Credit Cards” by Issuer for 2022, Argus data through November 2023, and internal calculations. |
| (3) | Source: Company internal data and The Nilson Report, February 2024. |
• 66 2024 PROXY STATEMENT 2023 Performance Multiplier – Company When considered collectively and weighted across Shareholder, Customer, Colleague and Strategic categories, the 2023 performance resulted in an enterprise performance outcome of Significantly Outperform. Based on this enterprise-wide performance outcome and in the context of the macroeconomic environment, the Compensation and Benefit Committee approved the 2023 Company Performance Multiplier of 130%. AIA payouts for 2023 performance occurred in February 2024. 
Performance Multiplier – Individual The Compensation and Benefits Committee differentiates and rewards leadership performance through the individual multiplier. Factors considered in determining the appropriate individual multiplier for the NEOs included the assessment of risk-taking, risk management and performance against the Company’s leadership behaviors (Setting the Agenda, Bring Others With You and Doing It the Right Way). The CEO’s individual performance objectives approved for all NEOs bymultiplier is also determined through a formal annual review process, including the CBCdevelopment of formal objectives at the beginning of 2017:each year, and the solicitation of formal feedback from each independent director on our Board at the end of each year. The maximum individual performance multiplier for leadership performance is 125%. In response to shareholder feedback, we have provided additional details highlighting what was considered when determining the individual multipliers for our NEOs. | 2017 Company Performance Multiplier Scorecard | | Financial (55%) | | Target | | 2017 Accomplishments | ●Revenue Growth(FX-adjusted)* | | 0% | *** | 4% | ●Fourth quarter Revenue Growth(FX-adjusted)* | | 5% | | 9% | ●EPS** | | $5.60 | | $5.87 | ●ROE** | | 25% | | 25% | | Customer (15%) | | | | | ●Internal metrics to measure customer satisfaction and customer growth | | | | Goals achieved at target levels | | Employee (15%) | | | | | | Talent Retention and Diversity Representation Goals | | | | Goals achieved at or above
target levels | | Long-term sign posts (15%) | | | | | ●Remove $1 Billion of costs from the expense base | | | | Above Target | ●Innovation and New Business Progress | | | | Above Target | ●Acceleration of Merchant Coverage balanced with reducing Discount Rate Erosion | | | | At Target | ●Evolution of Litigation Strategy | | | | Above Target | ●Strengthening Card Member Value Proposition | | | | Above Target | ●Continue to Grow Lending | | | | Above Target | | Company Performance Multiplier Score | | | | 130% (G1) |
The following is a summary description of each NEO’s individual performance highlights for fiscal year 2023. | Based on | | | S.J. Squeri Chairman and Chief Executive Officer | | | | | Individual Performance Highlights | | Performance Multiplier | ¾ Significantly strengthened collaboration across business unit leaders and amongst the entire senior leadership team, creating
synergies and fostering open dialogues that helped to drive our strong 2017 performance on key financial employeeresults, including 14% reported and customer dimensions that exceeded targets
15% FX-adjusted growth in revenue(1), EPS of $11.21 and along with meaningful progress32% ROE ¾ Developed and drove the Company’s strategy and further positioned the Company to deliver on the strategic priorities in its
“Framework for Winning,” including expanding its leadership position with premium consumers, continuing to build on its strong
position in commercial payments, strengthening its global integrated network and continuing to build on our unique global
position. ¾ Actively engaged with key stakeholders including shareholders, regulators and clients globally to communicate the Company’s
strategy and long-term growth plan. ¾ Continued to advance the Company’s long-term goals,talent strategy, which included identifying, developing, and positioning key next-generation
leaders to ensure our continued success, and consistently led the Company received a G1 rating that resulted in 130 percent score underdemonstrating the Company portionBlue Box Values — the
foundation of the plan.Company’s culture — which included building a robust conduct risk culture and exhibiting strong risk
management leadership through various enterprise wide and targeted programs. (1) Refer to footnote 2 under “Financial Results” on page 1 for details regarding FX-adjusted information. | | 125% |
2024 PROXY STATEMENT 67 • | * | | | | | C.Y. Le Caillec Chief Financial Officer | The foreign currency adjusted information assumes a constant exchange rate between the periods being compared for purposes of currency translation into U.S. dollars (i.e., assumes the foreign exchange rates used to determine results for the current period apply to the corresponding prior year period against which such results are being compared). Reported revenue growth was 4 percent and 10 percent for fiscal year 2017 and Q4 2017, respectively.
| | | | **Individual Performance Highlights | | Performance Multiplier | Adjusted diluted EPS and adjusted ROE, both excluding
¾ Successfully transitioned into the impactsCFO role driving the execution of the Tax Act of $2.6 billion, are non-GAAP measures. The estimated impacts may be refinedCompany’s growth plan. ¾ Effectively communicated the Company’s business and financial information to regulatory bodies and the financial and investor
community. ¾ Continued to drive improvements in financial planning and forecasting, reporting processes and expense discipline across the
Company, supporting its overall strategic direction. ¾ Managed the future as additional guidanceCompany’s capital and interpretations become available. See Annex B for reconciliations to EPSliquidity position through a challenging environment, with a strong control and ROE on a GAAP basis.compliance
environment. | | 120% | | *** | | D.E. Buckminster Vice Chairman | | | | | Each yearIndividual Performance Highlights
| | Performance Multiplier | ¾ Integral in driving the CBC considers the Company’s plans, the external environment and any significant business changes when setting compensation related goals. In 2017, the CBC approved a flat FX-adjusted revenue growth target which took into consideration the fact that 2016 included two quarters of revenues related to our Costco relationship that was discontinued at the end of the second quarter in 2016. Costco-related revenues (revenues from Costco in the U.S., Costco U.S. cobrand Card Members and other merchants for out-of-store spend on the Costco cobrand card) were approximately $1.2 billion in 2016. On an adjusted basis, the 2017 revenue target represented a roughly 4 percent increase when excluding 2016 Costco-related revenues (see Annex B for more information). Management believes revenues net of interest expense excluding estimated Costco-related revenues is useful in evaluating the ongoing operating performanceoverall strategic direction of the Company, following the endexploring growth opportunities globally and successfully leading
key areas of the Costcoorganization, including Global Strategic Partnerships, Global Advertising & Brand Management, Digital Labs and
China strategy, which support our enterprise culture of innovation and collaboration. ¾ Strengthened enterprise strategic partnerships and created new opportunities for new business development across the
Company, including exploring acquisitions and divestitures. ¾ Improved operational efficiency and effectiveness through consolidation of key processes and functions while further developing
the company’s progress in digital innovation and partnerships. ¾ Emphasized and ensured a strong conduct risk culture within the Company. | | 125% | | | | J.C. Campbell Former Vice Chairman and Former Chief Financial Officer | | | | | Individual Performance Highlights | | Performance Multiplier | ¾ Achieved a seamless transition of the Chief Financial Officer role to C.Y. Le Caillec while remaining Vice Chairman and strategic
advisor. ¾ Continued to focus on the long-term strategic direction of the Company. ¾ Drove understanding of the Company’s financial performance and growth plan amongst the investor community. ¾ Ensured the commitment to control and compliance around financial reporting, capital and liquidity during a year of heightened
expectations in the banking industry. | | 115% | | | A.D. Williams Group President, Enterprise Services and CEO American Express National Bank | | | Individual Performance Highlights | | Performance Multiplier | ¾ Partnered closely with senior leadership team to develop a vision and strategy for Enterprise Services, which delivered significant
outcomes for the Company, including reduced technology issues, improved customer satisfaction, increased efficiency and
greater digital adoption. ¾ Oversaw American Express National Bank, the U.S. relationship. In addition,Banking operation of American Express, which accounts for approximately
60 percent of the CBC approvedcompany’s total billings and revenues. ¾ Led various transformation programs across Technology, Cybersecurity, Digital and Servicing for the Company, including
developing plans to drive productivity, efficiency and customer experience enhancements. ¾ Successfully implemented a 5 percent fourth quarter revenue growth target for 2017 to underscorecomprehensive conduct risk culture program across the importance of exiting the year with momentum. The fourth quarter revenue growth target also provides a useful GAAP measure of management success considering the fourth quarter of 2016 did not include Costco-related revenue. The CBC applied a similar rationale when approving the $5.60 EPS target for 2017 considering $5.65 GAAP reported EPS for 2016. The CBC concluded that the $5.60 EPS target for 2017 represented an appropriate and challenging increase as compared to 2016 EPS excluding Costco-related earnings.Company. | | 120% |
• 68 2024 PROXY STATEMENT | 64 | | | L.E. Seeger Chief Legal Officer | 2018 Proxy Statement | | | |
Table of Contents
Compensation Discussion and Analysis 2018 Proxy Statement
CEO 2017 PERFORMANCE AND AIA OUTCOME (MR. CHENAULT, CHAIRMAN AND CEO FOR 2017)
Mr. Chenault’s AIA payout is based on performance against the Company’s scorecard and the resulting Company Performance Multiplier. Given the Company Performance resulting in G1 rating, Mr. Chenault achieved the maximum AIA payout for 2017 as follows ($000s):
| Target AIA | | Company Performance Multiplier | | Actual AIA | | $6,625 | | 125% | | $8,281 |
The Company’s AIA plan provided 130 percent of target AIA considering actual performance before the CBC’s adjustment to consider individual performance. The CEO’s compensation framework caps AIA payout to 125 percent of target. Therefore, despite exceptional performance, Mr. Chenault’s AIA was capped at 125 percent of target.
For 2017, Mr. Chenault’s AIA payout was awarded entirely in the form of RSUs that are deferred for one year following grant date to provide more emphasis on the Company’s future stock performance. Historically, all or a portion of the AIA awarded to our CEO has been paid in a form other than cash and has been deferred. With most of Mr. Chenault’s compensation subject to multi-year performance goals, his realizable pay is tied closely to the long-term success of the Company after his retirement.
PERFORMANCE MULTIPLIER – BUSINESS UNITS
For all NEOs other than the CEO, the objectives under the Business Unit Performance portion of the Performance Multiplier are weighted at 30 percent and evaluate performance in the areas generally directly under the purview of the executive. NEO scorecards may reflect shared Company goals in order to assess individual contribution toward the achievement of those goals, as applicable to each NEO’s business unit. The following summarizes each NEO’s goals and objectives for 2017 and performance against each goal.
MR. SQUERI, VICE CHAIRMAN, MR. CAMPBELL, EVP AND CHIEF FINANCIAL OFFICER AND MS. SEEGER, EVP AND GENERAL COUNSEL
Mr. Squeri’s, Mr. Campbell’s and Ms. Seeger’s Business Unit Multiplier was determined based on the performance against their respective Business Unit Scorecard metrics. Messrs. Squeri’s and Campbell’s goals were identical to the Company scorecard except for Employee metrics, which reflected the business units for which they were respectively responsible during 2017. Ms. Seeger’s goals were also identical to the Company scorecard except for Employee metrics and Long-Term Sign Posts, which reflected the business unit for which she was responsible during 2017.
Based on 2017 performance, Mr. Squeri, Mr. Campbell and Ms. Seeger each achieved goals above target, resulting in G1 ratings, which correspond to a 130 percent Business Unit performance multiplier.
MR. BUCKMINSTER, PRESIDENT, GLOBAL CONSUMER SERVICES
Mr. Buckminster’s performance on the Business Unit Multiplier was evaluated based on the following results on his 2017 Business Unit Scorecard:
| 2017 Buckminster Performance Multiplier Scorecard | | Financial (55%) | | Target | | 2017 Accomplishments | ●Revenue Growth(FX-adjusted)* | | 0% | | 5% | ●Fourth Quarter Revenue Growth(FX-adjusted)* | | 6% | | 11% | ●Pre-tax Income ($Millions) | | $3,861 | | $3,896 | | Customer (15%) | | | | | | Internal metrics to measure customer satisfaction and customer growth | | | | Goals achieved at target | | Employee (15%) | | | | | | Talent Retention and Diversity Representation Goals | | | | Goals achieved at or above
target levels | | Long-term sign posts (15%) | | | | | ●Acquisition Efficiency | | | | At Target | ●Continue to Grow Lending | | | | At Target | ●Card Member Engagement | | | | Above Target | ●Strengthening Card Member Value Proposition | | | | Above Target | | Company Performance Multiplier Score | | | | 130% (G1) |
*Individual Performance Highlights | | Performance Multiplier | The foreign currency adjusted information assumes
¾ Advised the Company across a constant exchange rate betweenrange of legal, reputational and regulatory matters, including oversight of the periods being comparedCompany’s litigation
strategy. ¾ Successfully led the Legal, Government Affairs, Global Security and Corporate Secretarial functions for purposes of currency translation into U.S. Dollars (i.e., assumes the foreign exchange rates used to determine resultsAmerican Express and its
subsidiaries for the current period applyenterprise’s long-term success, aligning each function to support each Company goal in a risk-mitigating
manner. ¾ Chaired the corresponding prior year period against which such results are being compared). Reported revenue growth was five percententerprise Conduct Risk Committee to provide enterprise-wide legal and 13 percent for fiscal year 2017strategic guidance and Q4 2017, respectively.advice with respect
to Conduct Risk management. ¾ Continued to deliver guidance and leadership to Senior Management and the Board on the legal and governance ramifications of
strategic matters. | | 120% |
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NEO INDIVIDUAL MULTIPLIER
In addition to Company and Business Unit Performance, the AIA formula contains an Individual Multiplier which allows the CBC to modify an award downwards or upwards to consider measurable factors such as individual performance including, quality of results, key leadership attributes, compliance with risk and control objectives and other relevant factors. The CBC’s decisions are reflected in the table below.
Summary of NEONEOs’ AIA Decisions and Outcomes for 20172023 The following table summarizes the actual AIA earned bypaid to each NEO for the 20172023 performance year based(in thousands). | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Name | | Target AIA | | x | | Company Multiplier | | x | | Individual Multiplier | | = | | Actual AIA | | | | | | | | | Stephen J. Squeri | | | $ | 6,000 | | | | | | | | | | 130 | % | | | | | | | | | 125 | % | | | | | | | | $ | 9,750 | | | | | | | | | | Christophe Y. Le Caillec | | | $ | 1,703 | * | | | | | | | | | 130 | % | | | | | | | | | 120 | % | | | | | | | | $ | 2,650 | | | | | | | | | | Douglas E. Buckminster | | | $ | 4,000 | | | | | | | | | | 130 | % | | | | | | | | | 125 | % | | | | | | | | $ | 6,500 | | | | | | | | | | Jeffrey C. Campbell | | | $ | 3,700 | | | | | | | | | | 130 | % | | | | | | | | | 115 | % | | | | | | | | $ | 5,550 | | | | | | | | | | Anré D. Williams | | | $ | 3,700 | | | | | | | | | | 130 | % | | | | | | | | | 120 | % | | | | | | | | $ | 5,750 | | | | | | | | | | Laureen E. Seeger | | | $ | 2,925 | | | | | | | | | | 130 | % | | | | | | | | | 120 | % | | | | | | | | $ | 4,500 | |
| * | Christophe Y. Le Caillec’s AIA reflects the increase in his target AIA from $1.3 million to $2.35 million as a result of his promotion to the role of Chief Financial Officer in August 2023. Per Company policy, AIA was pro-rated considering his time in each role. |
Summary of 2023 NEO LTIA Awards (Granted in January 2024) Based on Company and individual performance in 2023, the Compensation and Benefits Committee granted the following long-term incentive awards in January 2024. Vesting of these awards is dependent on the achievement of goals detailed above ($000s). | Name | | | | Performance Multiplier | | | | | | Target
AIA | x | Company
(70%) | + | Business
Unit (30%) | x | Individual
Multiplier* | | Actual
AIA** | | K.I. Chenault | | $6,625 | | 125% (capped at this level based on Company and individual performance) | | $8,281 | | S.J. Squeri | | $4,500 | | 130% | | 130% | | | | $7,000 | | D.E. Buckminster | | $2,200 | | 130% | | 130% | | CBC Assessment | | $3,550 | | J.C. Campbell | | $3,500 | | 130% | | 130% | | | $5,450 | | L.E. Seeger | | $1,600 | | 130% | | 130% | | | | $2,400 |
* | The AIA formula contains an Individual Multiplier which allows the CBC to modify an award downwards or upwards.
| ** | To comply with regulatory guidance that at least 50 percent of incentive compensation be deferred, $200,000 of Mr. Buckminster’s 2017 AIA and $850,000 of Mr. Campbell’s 2017 AIA were paid in the form of RSU’s granted in January 2018. The AIA figures in the above table do not reflect these adjustments.
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Long-Term Incentive Compensation Targets and 2017 Outcomesthe metrics described on page 60. The award amount for each NEO is as follows (in thousands):
The LTIA is intended to be formulaic and link compensation to the achievement
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | S.J. Squeri | | C.Y. Le Caillec | | D.E. Buckminster | | J.C. Campbell | | A.D. Williams | | L.E. Seeger | | | | | | | | Performance Restricted Stock Units | | | $ | 17,800 | | | | $ | 3,520 | | | | $ | 5,520 | | | | $ | 5,040 | | | | $ | 4,640 | | | | $ | 3,760 | | | | | | | | | Stock Options | | | $ | 4,450 | | | | $ | 880 | | | | $ | 1,380 | | | | $ | 1,260 | | | | $ | 1,160 | | | | $ | 940 | | | | | | | | | Total | | | $ | 22,250 | | | | $ | 4,400 | | | | $ | 6,900 | | | | $ | 6,300 | | | | $ | 5,800 | | | | $ | 4,700 | |
2024 PROXY STATEMENT 69 • Settlement of long-term objectives. LTIA compensation is awarded in three forms: a PG, PRSUs, and SOs. Each of these forms of incentives aligns NEOs interests with shareholder interests and establishes retention incentives through multi-year, performance-based vesting periods. Element | | 2017 Metrics | 2015-2017 PG(1) | | ●50% Three-year financial goals
| | | – Three year cumulative EPS (20%) | | | – Three year relative TSR as compared to S&P 500 (30%) | | | ●50% strategic milestones
| PRSUs | | ●Three-year average ROE
| SOs | | ●Stock price appreciation(2)
|
(1) | Paid in cash (except for CEO, who had all of his grant deferred and payable in equity)
| (2) | Subject to positive cumulative net income over the vesting period
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Portfolio Grant AwardedPerformance RSUs Granted in January 2015 (Vesting Based on 2015-2017 Performance)
The Portfolio Grant (PG) is a program with three-year performance cycles16. Under the program, management is assessed and rewarded for performance against a combination of financial objectives, stock price performance, and for results against specific strategic milestones that indicate success in positioning the Company for the future. For the 2015-2017 PG award, the size of the award was determined based on 2014 performance, with the ultimate value paid in 2018 resulting from performance during the 2015-2017 performance cycle as measured by three-year EPS, relative TSR and achievement of Strategic Milestones.
16 | Participants receive zero percent of the award at threshold level, 100 percent of the award at target level, and 125 percent of the award at maximum level. The payout range for achievement of strategic milestones is 0-125 percent and actual payout is based on actual performance against goals as well as the CBC’s judgment.
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Compensation Discussion and Analysis 2018 Proxy Statement
Based on its assessment of performance against the targeted metrics as described in the following sections, the CBC determined that performanceunderachievedobjectives and set the payout for the 2015-2017 cycle at79 percent of the target award.
Three-Year Cumulative EPS (20 Percent of Portfolio Grant)
The target goal established at the beginning of the three-year cycle was cumulative earnings of $17.36 per share, a level of earnings consistent with the Company’s business plan and management expectations at the start of the performance period. No payout would be earned on this factor for performance below $10.84 per share, or 62 percent of the target goal. The maximum payout, 125 percent of target, was set at $20.27 per share, or 117 percent of the target goal.
On a GAAP basis, cumulative earnings were $13.67 per share; however, the CBC deemed it appropriate to consider adjusted financials when determining the payout for this factor to exclude the 2017 charges related to the Tax Act as well as impairment and restructuring charges in 2016 and 2015. On an adjusted basis, the Company earned $17.18 per share over the time period, which would correspond to a 98.5 percent payout against target for this factor. Refer to Annex B for reconciliation.
| Results Needed for Potential Payout | | Three-Year Outcome | | 2017 Achievement | | Three-year EPS | | % Earned | | | | | | $20.27 | | 125% | | | | | | $17.36 | | 100% | | $17.18(1) | | 98.5% | | $14.45 | | 75% | | | | | | $10.84 | | 0% | | | | |
(1) | EPS includes: 2015 $5.38 (adj.), 2016 $5.93 (adj.), and 2017 $5.87 (adj.); 2015, 2016, and 2017 EPS adjusted for a charge in Enterprise Growth, restructuring charges, and the impacts related to the Tax Act, respectively. See Annex B for a reconciliation to EPS on a GAAP basis.
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Note: If the three-year EPS is between two points, straight-line interpolation will be applied.
Three-Year Relative TSR (30 Percent of Portfolio Grant)
| Results Needed for Potential Payout | | Three-Year Outcome | | 2017 Achievement | | Relative TSR | | % Earned | | | | | | +5% | | 125% | | | | | | 0% | | 100% | | -7.53% | | 37.3% | | -3% | | 75% | | | | | | -9% | | 25% | | | | |
This portion of the PG would pay at 100 percent if the Company’s TSR was equal to the S&P 500 and scaled down to no payout if TSR lagged the index by more than 9 percent. The maximum payout (125 percent) would be achieved if the Company’s TSR outperformed the index by 5 percent or more.
Actual performance over the period lagged the index by 7.53 percent, which corresponds to a 37.3 percent payout.
Note: If the 3-year EPS is between two points, straight-line interpolation will be applied.
Progress on Strategic Milestones (50 Percent of Portfolio Grant)
The strategic milestones established for this grant covered a range of initiatives, including customer and revenue-generating initiatives. The range of payouts for achievement against strategic milestones, as with the other elements, is from zero to 125 percent of target. The CBC uses judgment to score performance against these goals.
The CBC noted considerable success in terms of capturing a portion of the spending and borrowing of former Costco cobrand Card Members, expanding profitable lending, growing international revenues, and controlling operating expenses. However, performance was below-target on expanding global active merchant locations and driving Loyalty Partner revenue. As a result, the CBC determined that overall management met expectations in its strategic accomplishments and scored thesegoals at 95.8 percent of target.
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Strategic Milestones | | Three-Year Outcome | 1 | Capture a portion of the spending and borrowing of former Costco cobrand Card Members | | | 2 | Increase global active merchant locations in force | | | 3 | Expand profitable lending while effectively managing loss rates | | CBC concluded that most but not all milestones were scored at or above the target level. | 4 | Grow international revenue | | | 5 | Grow Loyalty Partner revenue | | | 6 | Control cost base | | |
Final Scoring for 2015-2017 Portfolio Grant
Based on the above discussions of actual performance against goals, the CBC concluded that the award should pay out at79 percent of its targeted amount.
| Performance Measure | | Weight | x | Achievement Score | = | Weighted Average
Score | | EPS | | 20% | | 98.5 | | 19.7% | | Relative TSR | | 30% | | 37.3 | | 11.2% | | Strategic Milestones | | 50% | | 95.8 | | 48.0% | | | | | | | Payout: 79% |
Over the last three years, the PG program (including the 2015-2017 program) has paid out below its targeted amount, reinforcing our rigor of goals and stretch targets. |
The CEO and other NEOs’ PG 2015-17 grants resulted in the following payouts ($000s):
| | PG 2015-17
Grant
Amount | | PG 2015-17
(Q1 2018)
Payout | | K.I. Chenault(1) | | $ | 5,125 | | $ | 4,049 | | S.J. Squeri | | $ | 1,325 | | $ | 1,047 | | D.E. Buckminster | | $ | 900 | | $ | 711 | | J.C. Campbell | | $ | 1,500 | | $ | 1,185 | | L.E. Seeger | | $ | 1,100 | | $ | 869 |
(1) | Note: Mr. Chenault’s payment of $4,048,750 was in the form of RSUs granted in January 2018 with one year delayed delivery.
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Performance RSUs Awarded in January 2015-Vesting Based on 2015-2017 Performance2021
Performance RSUs were awardedgranted in January 2015 for the three-year performance period ending December 2017. The awards vest2021 vested in January 2024 at 116% based on the Company’s three-year averagerelative ROE performance. | Metric | | Results Needed for Potential Payout | | Three-Year Outcome | | 2015-2017
Achievement | | | Three-Year Average ROE | | % Target Shares Granted | | | | | | | | | >=30% | | 125% | | 25.1%(average) | | | | | 28% | | 108.3% | | Year | | ROE | | | | Three year average ROE | | 23 – 27% | | 100% | | 2017 | | 25.4%17 | | 100% | | | 22% | | 95% | | 2016 | | 26.0% | | | | | 20% | | 75% | | 2015 | | 24.0% | | | | | <=5% | | 0% | | | | | | |
17 | 2017 ROE excluding the impacts from the Tax Act of $2.6 billion. On a GAAP basis, ROE was 13.1 percent; however, the CBC deemed it appropriate to consider adjusted financials when determining the payout for this factor to exclude the 2017 charges related to the Tax Act. See Annex B for a reconciliation to ROE on a GAAP basis.
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Compensation Discussionpositioning (87th percentile) and Analysis 2018 Proxy Statement
This resulted in the vesting of the following sharesTSR positioning (91st percentile) for the CEO and other NEOs:
| | Target Number
of Shares | | Shares
Vested | | K.I. Chenault | | 87,777 | | 87,777 | | S.J. Squeri | | 27,777 | | 27,777 | | D.E. Buckminster | | 13,111 | | 13,111 | | J.C. Campbell | | 25,777 | | 25,777 | | L. E. Seeger | | 17,777 | | 17,777 |
Otherthree-year (2021-2023) performance period.
Pay Ratio
Our CEO to median compensated employee pay ratio is 327:1, with the Summary Compensation Table number for Mr. Chenault being $18,611,373 and the equivalent number for the identified median employee being $56,873.
To calculate our median compensated employee, we reviewed our worldwide employee population, consisting of 19,864 U.S. employees and 33,985 non-U.S. employees, and examined the 2017 total compensation for all employees, excluding our CEO, who were employed by us as of November 30, 2017. As our non-U.S. employees exceed 5 percent of our total U.S. and non-U.S. employees, we applied the de minimis exception to exclude all non-U.S. employees in certain jurisdictions that were not representative of our worldwide employee base across various job levels.* As a result, our median compensated employee calculation includes all permanent Company employees, whether full-time or part-time, consisting of 19,864 U.S. employees and 32,058 non-U.S. employees (an aggregate of 96.4 percent U.S. employees and non-U.S. employees), and excludes 1,927 non-U.S. employees (an aggregate of 3.6 percent non-U.S. employees) from the calculation (Median Compensated Employee). Selected for purposes of the pay ratio calculation was an U.S. based employee. This employee was selected as their compensation was in line with the median compensation of the target population explained above.
To calculate the annual total compensation for our Median Compensated Employee, we used the same methodology as set forth in the 2017 Summary Compensation Table in this proxy statement. We did not make any assumptions, adjustments, or estimates with respect to total compensation. However, we annualized the base salary compensation for full-time employees that were newly hired in 2017. We believe the use of annual total compensation for all employees is a consistently applied compensation measure as it includes all key elements of employee pay (base salary, short-term incentive awards and long-term incentive awards) paid to most of our employees.
| * | Approximate excluded employee count by each country follows: Austria (50), Belgium (1), Brazil (24), Channel Islands (8), Chile (12), China (108), Czech Republic (22), Denmark (2), Finland (2), Germany (477), Hungary (11), Indonesia (4), Ireland (3), Korea (23), Malaysia (1,004), New Zealand (63), Norway (2), Poland (36), Russia (63), Switzerland (8) and Turkey (4). | | | | | | | | | | | | | | |
Stock Ownership Guidelines
Our current stock ownership guidelines require the CEO and our other NEOs to own and maintain a substantial stake in the Company. The CEO and our other NEOs are required to accumulate shares (i.e., shares owned outright, excluding unvested/unearned shares and unexercised stock options) with a value equivalent to a target multiple of their base salary, and to retain 50 percent of the net after-tax shares received upon vesting or exercise of their equity awards until guidelines are met. This is a change from our prior stock ownership guidelines which required the CEO and other NEOs to accumulate a target number of shares (500,000 for CEO, 25,000 or 75,000 for all other NEOs). The CBC made this change to better align the Company with market best practices and its peers. The specific requirements are as follows:
OfficerAXP Relative ROE Performance (vs LTIA Peer Group) | | Multiple of Base Salary | | MODIFIER: AXP Relative TSR Performance (vs LTIA Peer Group) | | | | | | CEO | | | | | | | | 2021-2023 ROE
Performance | | 10 xPercentile
Positioning | | Payout % | | | | 2021-2023 TSR
Performance | | Percentile
Positioning | | Impact to
Payout % | | | | | | All Other NEOS | | | | | | | | 87th Percentile | 3 x | ≥90th | | 120% | | & | | 91st Percentile | | ≥67th | | None | | = | | 116% Payout | All of our NEOs own more than the target number of shares. | 87th | | 116% |
| 69 75th | | 100% | | 50th | | 80% | | <67th | | Cap at
100% | | 25th | | 50% | | <25th | | 0% |
2024 Annual Target Direct Compensation As discussed in the “Annual Compensation and Decision-Making Process” on page 61, the Compensation and Benefits Committee reviews target direct compensation each year. For 2024, no adjustments were made to the CEO’s or any of the NEO’s total target compensation. All compensation components except base salary are performance based (in thousands): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | S.J. Squeri | | C.Y. Le Caillec | | D.E. Buckminster | | A.D. Williams | | L.E. Seeger | | | | | | | Base Salary | | | $ | 1,500 | | | | $ | 750 | | | | $ | 1,100 | | | | $ | 1,000 | | | | $ | 875 | | | | | | | | AIA(1) | | | $ | 6,000 | | | | $ | 2,350 | | | | $ | 4,000 | | | | $ | 3,700 | | | | $ | 2,925 | | | | | | | | Performance Restricted Stock Units(2) | | | $ | 17,800 | | | | $ | 3,520 | | | | $ | 5,520 | | | | $ | 4,640 | | | | $ | 3,760 | | | | | | | | Stock Options(3) | | | $ | 4,450 | | | | $ | 880 | | | | $ | 1,380 | | | | $ | 1,160 | | | | $ | 940 | | | | | | | | Total Direct Compensation | | | $ | 29,750 | | | | $ | 7,500 | | | | $ | 12,000 | | | | $ | 10,500 | | | | $ | 8,500 | |
| (1) | Actual AIA payout will be based on Company and individual performance in 2024 considering performance against pre-established goals. |
| (2) | Performance Restricted Stock Units cliff vest after three years based on relative ROE and relative TSR performance over the three-year period. |
| (3) | Stock Options cliff vest 100% after three years based on positive cumulative net income. |
Note: Mr. Campbell retired on March 1, 2024 and is excluded from the table.
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2018 Proxy Statement• 70 2024 PROXY STATEMENT
Section 6: Compensation DiscussionPolicies and AnalysisPractices Tax Treatment
Tax rules generally limit the deductibility of compensation paid to our NEOs to $1 million per year. Prior to the Tax Act, “performance-based” compensation was excepted from this limit, and so the Company generally structured its incentive compensation arrangements in a manner that was intended to comply with these tax rules. However, the CBC has always maintained the flexibility to pay nondeductible incentive compensation.
Discouraging Imprudent Risk TakingRisk-Taking Our executive compensation program is structured to provide a balance of cash and stock; annual, medium-term and long-term incentives; and financial, strategic and stock performance measures over various time periods. It is designed to encourage the proper level of risk taking consistent with our business model and strategies. Our business and risk profile is different from other financial services firms; for example, we do not generally trade securities, derivatives, mortgages or other financial instruments other than for hedging our risks. Our executive compensation program is designed to be consistent with the Federal Reserve principles for safety and soundness.is: | Structured to provide a balance of cash and stock; annual and long-term incentives; and varied performance measures over different time horizons |
| Designed to encourage the proper level of risk-taking consistent with our business model and strategies |
| Designed to be consistent with regulatory principles for safety and soundness |
The following policies and procedures help discourage imprudent risk taking:risk-taking: Discouraging Imprudent Risk-Taking | ● | | | Annual risk goals:Our Chief Risk Officer reviews business unit and NEO goals in relation to the Company’s risk appetite and sets certain annual risk goals for the Company at the beginning of each year.
| ●Cross-Section of Metrics | Monitoring of risk:We monitor return on economic capital, credit risk metrics and performance against our risk appetite metrics, and we assign control and compliance ratings to each business unit and staff group as part of our annual assessment of performance.
| ● | Adjustment of compensation:At year-end, our Chief Risk Officer meets with the CBC and certifies that actual results were achieved with proper risk governance and oversight, and that the Company executed a broad range of programs that help to avoid imprudent risk taking. Larger losses are analyzed as part of the year-end process, and the Chief Risk Officer issues a year-end memorandum describing changes in the risk profile of the Company. If deemed necessary, risk adjustments are made to company and business unit annual incentive funding levels as well as to individual incentive awards.
| ● | Cross-section of metrics:We assess Company performance against a cross-section of key metrics and over multiple time frames to discourage undue focus on short-term results or on any one metric and to reinforce risk balancing in performance measurement. Our incentive plans are not overly leveraged (i.e., there is a cap on the maximum payout).
| | ● | Annual Risk Goals | | Our Chief Risk Officer reviews goals for safety and soundness in relation to the Company’s risk appetite and sets certain annual risk goals for the Company at the beginning of each year. | | | Monitoring of Risk | | We continuously monitor relevant metrics, including credit risk and market risk metrics, performance against our risk appetite thresholds as well as material operational risk events on a regular basis. We assign control and compliance ratings to each business unit as part of our annual assessment of performance. | | | Adjustment of Compensation | | At year-end, our Chief Risk Officer meets with the Compensation and Benefits Committee and certifies as to whether actual results were achieved with proper risk governance and oversight and whether the Company executed on its broad range of programs that help to avoid imprudent risk-taking. The Chief Risk Officer issues a year-end memorandum summarizing an overall assessment of the Company’s risk profile. If deemed necessary, risk adjustments are made to Company annual incentive funding levels as well as to individual incentive awards. | | | Deferred incentive compensation:Incentive Compensation | | At least 50 percent50% of total incentive compensation for executive officers is deferred for at least three years with performance-based vesting.payout. | | ● | Performance Based Vesting | Performance-based vesting:PRSUs
| Performance Restricted Stock Units are used in place of time-based RSUs for the Company’s senior employees.colleagues. | | ● | Stock Ownership Requirements | Stock ownership and holding requirements:
| We have robust stock ownership requirements for our CEO and other NEOs (as described above)below). |
Stock Ownership Guidelines | | | Our current stock ownership guidelines require the CEO and our other NEOs to own and maintain a substantial stake in the Company. The CEO and our other NEOs are required to accumulate shares (i.e., shares owned outright, excluding unvested/unearned shares and unexercised stock options) with a value equivalent to a target multiple of their base salary and to retain 50% of the net after-tax shares received upon vesting or exercise of their equity awards until guidelines are met. The specific requirements are shown in the diagram. As of December 31, 2023, all of our NEOs, except for Mr. Le Caillec who was promoted to CFO and became an executive officer effective August 14, 2023, own more than their required target number of shares. | |  |
2024 PROXY STATEMENT 71 • Clawback and Recoupment Policies We seek to recover to the extent practicable, performance-basedincentive-based compensation from any executive officer, and certain other members of senior managementManagement and other colleagues under certain circumstances. In October 2023, in accordance with NYSE listing rules, the Compensation and Benefits Committee adopted our Policy for the Recovery of Erroneously Awarded Compensation (Policy). The Policy provides that we will seek to recover, on a no-fault basis, erroneously awarded incentive-based compensation received by any current or former executive officer during the three-year period preceding the date on which we are required to prepare an accounting restatement (i) due to the material noncompliance of the Company with any financial reporting requirement under the securities laws, including any required accounting restatement to correct an error in previously issued financial statements that is material to the previously issued financial statements, or (ii) that corrects an error that is not material to previously issued financial statements, but would result in a material misstatement if the error were not corrected in the following circumstances:current period or left uncorrected in the current period (an accounting restatement). The new Policy supplements our existing Incentive Compensation Recoupment Policy. The Incentive Compensation Recoupment Policy allows us to seek to recover excess incentive-based compensation received by any colleague during the three-year period preceding the date on which we are required to prepare an accounting restatement if the colleague engaged in misconduct that contributed to the noncompliance that caused or partially caused the need for the restatement. We continue to maintain our Incentive Compensation Recoupment Policy because it allows us to recoup compensation from a broader group of colleagues than that required by the NYSE listing rules. In addition, we continue to maintain agreements containing Detrimental Conduct provisions applicable to certain colleagues, which allow us to cancel and seek recovery of certain incentive-based compensation if the colleague engages in certain prohibited conduct. The table below outlines our policies: | ● | | | | | | | | | | | | Policy for the Recovery of
Erroneously Awarded Compensation | | Detrimental Conduct Provisions | | Incentive Compensation
Recoupment Policy | | | | | WHO | | Current and former executive officers | | Approximately 1,700 colleagues at Vice President level and above (including CEO) | | The payment of such compensation was based on the achievement of financial results that were subsequently the subject of a financial restatement; andAll colleagues
| | ● | | | WHEN | | In the viewAXP is required to prepare an accounting restatement
¾ Applicable regardless of our Board, the employee engagedfault or
involvement in fraud or misconductissues that caused or
partially caused the need for the
restatement | | Applies when colleagues engage in the following detrimental conduct: ¾ Working for a named competitor (applies
to approximately 600 colleagues) ¾ Soliciting American Express colleagues
or customers ¾ Denigrating the Company in the media ¾ Engaging in other defined misconduct
that leads to termination ¾ Misappropriation of confidential
information or trade secrets; or ¾ Other detrimental conduct categories
(e.g., material violation of the Code
of Conduct) | | AXP is required to prepare an accounting restatement: ¾ Colleagues engaged in fraud or
misconduct that caused or partially
caused the need for the restatement | | | | | WHAT | | Recovery of the difference between the amount actually paid and a smaller amountwhat would have been paid to the employee based uponon the restated financial results.results | | Forfeit unvested awards and repay the value of Incentive Compensation Plan (ICP) awards (including cash annual incentives for executive officers and including dividends/dividend equivalents paid on restricted stock/restricted stock units) that vested in the prior two years | | Recovery of the difference between the amount actually paid and what would have been paid based on the restated financial results |
In addition, the cash portion of the CEO’s AIA is subject to clawbackrecoupment at the discretion of the CBCCompensation and Benefits Committee if the Company does not achieve acceptable performance in the following year. Our clawback policy is significantly more robust than required by law.
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Compensation Discussion and Analysis2018 Proxy Statement• 72 2024 PROXY STATEMENT
The Company also maintains a detrimental conduct policy covering approximately 500 employees, including the CEO. This policy requires an executive to forfeit unvested awards and to repay the proceeds from some or all of his or her compensation issued under our incentive compensation program in the event the executive engages in conduct that is detrimental to the Company.
Hedging and Pledging RestrictionsExecutive officers may not hedge company shares (e.g., no short sales, forwards, options or collars) or pledge shares.
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Perquisites We provide limited perquisites to support our objective to attract and retain talent for key positions, as well as to address security concerns. We also provide an annual cash perquisite allowance of $35,000For the CEO, the Company’s security policy requires him to use, for executive officersall travel purposes, to the maximum extent practicable, the automobiles and aircraft provided by the Company. From time to time, and along with proper approvals in accordance with applicable Company policies, certain NEOs are permitted personal use of the Company.aircraft. Our NEOs are also eligible to receive certain benefits available to all other colleagues with a corporate card including Membership Reward points which are available for personal use. Award Timing
Consistent with past practice, annual cycle LTIA awards were granted to NEOs in January after the regularly scheduled January CBC meeting. Our off-cycle LTIA awards (for new hires, mid-year promotions, retention grants, etc.) are granted on pre-established grant dates.
Role of the Independent Compensation Consultant
The CBC endeavors to follow good governance practices and is composed solely of independent directors. The CBC is responsible for our executive officer compensation decisions. It has retained Semler Brossy Consulting Group (Semler Brossy) as its independent compensation consultant. It held four meetings over the course of 2017, all of which ended with executive sessions without management present. During 2017, Semler Brossy attended CBC meetings, including executive sessions, and provided compensation advice independent of the Company’s management. The CBC assessed the independence of Semler Brossy pursuant to SEC rules and concluded that their work did not raise any conflicts of interest.
Post-Employment Compensation Retirement Benefits NEOs receive retirement benefits through the following plans: ●¾ | | Retirement Savings Plan (RSP):A qualified 401(k) savings plan available to all eligible employees.U.S. colleagues. |
●¾ | | Retirement Plan: A defined-benefit cash balance retirement plan for eligible U.S. colleagues. Benefit accruals were discontinued since 2007. |
| ¾ | | Retirement Restoration Plan (RRP):A nonqualifiedU.S. non-qualified savings plan that makes up for 401(k)RSP and Retirement Plan benefits that would otherwise be lost as a result of contribution limits for qualified plans under U.S. tax limits.law. |
●¾ | Deferred Compensation: | Deferral Plan: Allows U.S. NEOs to defer a portion of their base salary and AIA payout. The annual deferral limit is equal to one times theirthe NEO’s base salary. |
AllNEO retirement benefits are more fully described under Retirement Plan Benefits onpage 8182 and under NonqualifiedNon-Qualified Deferred Compensation onpages 82 and83.83-84.
Severance: Senior Executive Severance PolicyPlan The CBCCompensation and Benefits Committee must pre-approve severance for anthe Company’s executive officer.officers. Under the Senior Executive Severance Policy,Plan, NEOs who are terminated involuntarily (except in cases of misconduct)for reasons that make them eligible for severance receive cash severance benefits equal to twoone- and one-half years of base salary and AIA andtarget AIA. The Company also receive aprovides pro rata AIA payment for the year of termination. LTIAstermination, calculated based on the number of days the NEO was employed during the calendar year prior to the commencement of severance. Equity awards issued under the ICP continue to vest and certain benefits continue during the severance period, unless the executive begins full-time, outside employment. U.S.-based NEOs who are age 65 or older are not eligible for severance, unless the CBCCompensation and Benefits Committee specifically approves severance for such an executive. To protect shareholders and our business model, executives are required to comply with non-compete, non-solicitation, confidentiality and non-denigration provisions during the period of time they are receiving severance. Our uniform severance policyplan helps to avoid special treatment and provides an important enforcement mechanism for these protections. | 71
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TableTax Treatment
Tax rules generally limit the deductibility of Contents 2018 Proxy Statement Compensation Discussion and Analysis
Change in Control Benefits
The Company provides change in control benefits to encourage executives to consider the best interests of shareholders by stabilizing any concerns about their own personal financial well-being in the face of a potential CIC of the Company. Detailed information is provided under Potential Payments Upon Termination or Change in Control (CIC) onpages 84-87.
A Commitment to Diversity and Inclusion
Our commitment to diversity and inclusivity is one of our Company’s greatest strengths. It is vitalcompensation paid to our success that we recruitNEOs to $1 million per year. The Compensation and retainBenefits Committee maintains the best talent and that our workforce is representative of the customers and communities we serve. Likewise, we believe the best wayflexibility to serve our customers is by providing best-in-class support to the employees who serve them. We make it welcoming, purposeful and rewarding to be part of the American Express organization. That means fostering a diverse and inclusive culture and enabling our employees to achieve their professional and personal goals. Our high employee satisfaction ratings and employer of choice awards show that we are making a positive impact for our people. Today, we continue to evolve and grow our diversity and inclusion programs and initiatives. When we recruit and develop talent at all levels, we seek passionate, driven people from all walks of life, and hold senior executives accountable for ensuring diversity through the inclusion of diversity goals in our business scorecard. We believe including specific and measurable metrics that address retention and diversity in our pay program is key to the short- and long-term success of the Company. We aspire to develop a diverse talent pool and to foster an inclusive workplace culture where differences are valued and expressed freely—and all our employees have the support they need to take risks, learn and collaborate. As such, we continue to evolve and enhance our diversity and inclusion focus and leading best practices.non-deductible incentive compensation.
2024 PROXY STATEMENT 73 • Section 7: Report of the Compensation and Benefits Committee The CBCCompensation and Benefits Committee has reviewed and discussed the CD&A with management.Management. Based on suchits review and discussion, it recommended to the Board, and the Board approved, the inclusion of the CD&A in this proxy statement.Proxy Statement. Compensation and Benefits Committee*COMPENSATION AND BENEFITS COMMITTEE
Robert D. Walter, Chairman
Ursula M. Burns
Peter Chernin
Samuel J. Palmisano
Ronald A. Williams
(*Reflects 2017 CBC membership)
| 72 | | John J. Brennan, Chair Peter Chernin Ralph de la Vega | 2018 Proxy Statement | Theodore J. Leonsis Lynn A. Pike Daniel L. Vasella |
Table of ContentsCompensation Tables
Compensation Discussion and Analysis2018 Proxy Statement
Note Regarding 2017 TDCTotal Direct Compensation Decisions and Summary Compensation Table It is important to recognize that the way the CBCCompensation and Benefits Committee presents TDCtotal direct compensation is different from the SEC-required disclosure in the Summary Compensation Table on the following page and is not a substitute for the information in that table. In summary, the main difference between the Summary Compensation Table and TDCtotal direct compensation is the timing of disclosure related to equity awards. The chart below details this methodology. | | | | | | | | | | | | | | | Summary Compensation Table* | TDC | Total Direct Compensation | | | | |
| Concept and Purpose | | | | Uses SEC methodology, which includes a mix of both cash compensation actuallyearnedduring 20172023 and estimated value of equitygrantedin 20172023 SEC-mandated compensation disclosure | | Includes only pay that isawardedbased on 2017 performance—2023 performance and reflects the CBC’sCompensation and Benefits Committee’s January 20182024 compensation decisions based on 2017 performance | | | | |
| Calculated as a sum of: | | Base salary | | Base Salary
| ●¾Base salary paid in 2017
2023 | ●
| ¾Base salary set for 2018 2023 | | | | | | | Annual bonus | | Annual bonus
| ●¾Annual cash bonus earned for 20172023 performance,
excluding any incentive deferred into equity | ●
| ¾Total annual bonus (AIA) awarded for 2017 performance—2023 performance, regardless of form of payment (i.e., cash or equity) | | | | | | | Equity awards | | Portfolio Grant award
| ●Value of PG earned for 2015- 2017 (if paid in cash)
| ●Value of PG 2018-2020 granted for performance year ending 2017
| | Equity awards
| ●¾Accounting value of equity awards (Stock Options and RSUs) granted in 2017
2023 (Performance Restricted Stock Units, Restricted
Stock Units, and Stock Options as applicable) | ●
| ¾Grant date value of equity awards (Stock Options
(Performance Restricted Stock Units and RSUs)
Stock Options) granted in January 20182024 for
performance year ending 20172023 |
| * | The SEC rules also require disclosure of additional elements of compensation beyond the ones mentioned in this table, such as future pay opportunities for pension benefits, above market interest rate on deferred compensation and all other compensation. |
Glossary of Key Compensation Terms
NEOs | Named Executive Officers: refers collectively to the Executive Officers referenced herein and includes Messrs. Chenault, Squeri, Campbell and Buckminster and Ms. Seeger
| TDC | Total Direct Compensation: the sum of base salary, Annual Incentive Awards (AIA) and Long-Term Incentive Awards (LTIA) | AIA | Annual Incentive Award: the Company’s annual incentive program that measures Shareholder, Customer, Employee and long-term signpost goals over a one-year period
| LTIA | Long-Term Incentive Award: the combination of cash- and equity-based long-term incentives that align with long-term business objectives and shareholder value creation; includes Portfolio Grants (PG), Restricted Stock Units (RSUs) and Stock Options (SOs)
| PG | Portfolio Grant: cash-denominated, performance-based long-term incentive that measures financial performance and the achievement of strategic milestones, all measured over a three-year period
| RSUs | Restricted Stock Units: share-denominated long-term incentives. PRSUs refer to performance-based restricted stock units that are conditioned on ROE performance over a three-year period (also subject to service vesting)
| SOs | Stock Options: share-denominated long-term incentive that has value only if the Company’s share price appreciates above the grant price
|
|
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2018 Proxy Statement Compensation Discussion and Analysis• 74 2024 PROXY STATEMENT
Summary Compensation Table The following Summary Compensation Table summarizes the compensation of our NEOs for the year ended December 31, 2017,2023, using the SEC-required disclosure rules. It is important to recognize that 2017 TDC2023 total direct compensation determined by the CBCCompensation and Benefits Committee is different than the amounts disclosed below using the SEC-required disclosure rules.below. Seepage 73 for key differences between the Summary Compensation Table and TDCtotal direct compensation awarded by the CBCCompensation and Benefits Committee for 2017.2023 Performance. | Name and Principal Position | Year | Salary | Bonus(1) | Stock
Awards(2) | Option
Awards(2) | Non-equity
Incentive Plan
Compensation(3) | Change in
Pension
Value and
Non-Qualified
Deferred
Compensation
Earnings(4) | All Other
Compensation(5) | Total | | K.I. Chenault | 2017 | $ | 2,038,462 | $ | 0 | $ | 12,209,937 | $ | 3,200,989 | $ | 0 | $ | 498,949 | $ | 663,036 | $ | 18,611,373 | | Chairman and | 2016 | $ | 2,000,000 | $ | 0 | $ | 12,809,527 | $ | 1,573,150 | $ | 0 | $ | 518,804 | $ | 562,158 | $ | 17,463,639 | | Chief Executive Officer* | 2015 | $ | 2,000,000 | $ | 0 | $ | 16,339,045 | $ | 2,563,088 | $ | 0 | $ | 300,525 | $ | 785,433 | $ | 21,988,091 | | S.J. Squeri | 2017 | $ | 1,375,962 | $ | 7,000,000 | $ | 3,765,808 | $ | 5,384,176 | $ | 1,046,750 | $ | 60,075 | $ | 520,893 | $ | 19,153,664 | | Vice Chairman* | 2016 | $ | 1,350,000 | $ | 5,100,000 | $ | 3,763,308 | $ | 886,690 | $ | 795,000 | $ | 50,006 | $ | 386,262 | $ | 12,331,266 | | 2015 | $ | 1,301,154 | $ | 2,750,000 | $ | 8,563,819 | $ | 811,088 | $ | 771,150 | $ | 0 | $ | 359,965 | $ | 14,557,176 | | J.C. Campbell | 2017 | $ | 1,019,231 | $ | 4,600,000 | $ | 2,024,562 | $ | 475,352 | $ | 1,185,000 | $ | 0 | $ | 312,122 | $ | 9,616,267 | | Executive Vice President | 2016 | $ | 1,000,000 | $ | 3,925,000 | $ | 2,023,235 | $ | 476,703 | $ | 900,000 | $ | 0 | $ | 230,988 | $ | 8,555,926 | | and Chief Financial | 2015 | $ | 1,000,000 | $ | 4,850,000 | $ | 2,147,224 | $ | 752,688 | $ | 873,000 | $ | 0 | $ | 222,403 | $ | 9,845,315 | | Officer | | | | | | | | | | | | | | | | | | | D.E. Buckminster | 2017 | $ | 754,808 | $ | 3,350,000 | $ | 1,619,681 | $ | 2,630,276 | $ | 711,000 | $ | 46,428 | $ | 321,717 | $ | 9,433,910 | | President, Global** | 2016 | $ | 700,000 | $ | 2,200,000 | $ | 1,294,890 | $ | 305,095 | $ | 540,000 | $ | 37,529 | $ | 246,427 | $ | 5,323,941 | | Consumer Services | 2015 | $ | 616,538 | $ | 1,650,000 | $ | 1,092,146 | $ | 382,841 | $ | 523,800 | $ | 0 | $ | 194,096 | $ | 4,459,421 | | L.E. Seeger | 2017 | $ | 815,385 | $ | 5,034,000 | $ | 1,619,681 | $ | 380,289 | $ | 869,000 | $ | 0 | $ | 265,679 | $ | 8,984,034 | | Executive Vice President | 2016 | $ | 800,000 | $ | 4,733,000 | $ | 1,618,599 | $ | 381,365 | $ | 660,000 | $ | 0 | $ | 200,109 | $ | 8,393,073 | | and General Counsel | 2015 | $ | 800,000 | $ | 3,858,000 | $ | 1,480,824 | $ | 519,088 | $ | 640,200 | $ | 0 | $ | 157,631 | $ | 7,455,743 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Name and Principal Position(1) | | Year | | Salary | | Bonus(2) | | Stock
Awards(3),(4) | | Option
Awards(3) | | Change in
Pension Value
and
Non-Qualified
Deferred
Compensation
Earnings(5) | | All Other
Compensation(6) | | Total | | | | | | | | | | S.J. Squeri | | | | 2023 | | | | $ | 1,500,000 | | | | $ | 9,750,000 | | | | $ | 19,287,280 | | | | $ | 4,449,964 | | | | $ | 64,534 | | | | $ | 625,127 | | | | $ | 35,676,905 | | | | | | | | | | | Chairman and CEO | | | | 2022 | | | | $ | 1,500,000 | | | | $ | 10,312,500 | | | | $ | 16,834,744 | | | | $ | 18,799,985 | | | | $ | 3,393 | | | | $ | 579,009 | | | | $ | 48,029,631 | | | | | | | | | | | | | | | | 2021 | | | | $ | 1,500,000 | | | | $ | 8,000,000 | | | | $ | 12,549,027 | | | | $ | 2,899,974 | | | | $ | 16,429 | | | | $ | 548,492 | | | | $ | 25,513,922 | | | | | | | | | | | C.Y. Le Caillec | | | | 2023 | | | | $ | 719,129 | | | | $ | 2,650,000 | | | | $ | 2,708,888 | | | | $ | 0 | | | | | N/A | | | | $ | 167,137 | | | | $ | 6,245,154 | | | | | | | | | | | Chief Financial Officer | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | D.E. Buckminster | | | | 2023 | | | | $ | 1,100,000 | | | | $ | 6,500,000 | | | | $ | 6,281,184 | | | | $ | 1,379,970 | | | | $ | 49,235 | | | | $ | 301,189 | | | | $ | 15,611,578 | | | | | | | | | | | Vice Chairman | | | | 2022 | | | | $ | 1,100,000 | | | | $ | 7,200,000 | | | | $ | 6,288,477 | | | | $ | 1,379,956 | | | | $ | 0 | | | | $ | 214,716 | | | | $ | 16,183,150 | | | | | | 2021 | | | | $ | 1,100,000 | | | | $ | 7,075,000 | | | | $ | 5,106,092 | | | | $ | 1,179,977 | | | | $ | 8,249 | | | | $ | 264,357 | | | | $ | 14,733,675 | | | | | | | | | | | J.C. Campbell | | | | 2023 | | | | $ | 1,000,000 | | | | $ | 5,550,000 | | | | $ | 5,786,040 | | | | $ | 1,259,970 | | | | | N/A | | | | $ | 244,910 | | | | $ | 13,840,920 | | | | | | | | | | | Former Vice Chairman and Former Chief Financial Officer | | | | 2022 | | | | $ | 1,000,000 | | | | $ | 6,625,000 | | | | $ | 5,781,805 | | | | $ | 1,259,955 | | | | | N/A | | | | $ | 171,880 | | | | $ | 14,838,640 | | | | | | 2021 | | | | $ | 1,000,000 | | | | $ | 6,500,000 | | | | $ | 4,586,779 | | | | $ | 1,059,973 | | | | | N/A | | | | $ | 206,880 | | | | $ | 13,353,632 | | | | | | | | | | | A.D. Williams | | | | 2023 | | | | $ | 1,000,000 | | | | $ | 5,750,000 | | | | $ | 5,265,119 | | | | $ | 1,159,960 | | | | $ | 32,903 | | | | $ | 173,996 | | | | $ | 13,381,978 | | | | | | | | | | | Group President, Enterprise Services | | | | 2022 | | | | $ | 1,000,000 | | | | $ | 6,037,500 | | | | $ | 5,376,343 | | | | $ | 5,659,955 | | | | $ | 0 | | | | $ | 170,980 | | | | $ | 18,244,778 | | | | | | | | | | | and CEO of AENB | | | | 2021 | | | | $ | 951,634 | | | | $ | 6,037,500 | | | | $ | 5,022,813 | | | | $ | 1,159,960 | | | | $ | 0 | | | | $ | 190,801 | | | | $ | 13,362,708 | | | | | | | | | | | L.E. Seeger | | | | 2023 | | | | $ | 875,000 | | | | $ | 4,500,000 | | | | $ | 4,274,053 | | | | $ | 939,950 | | | | | N/A | | | | $ | 155,480 | | | | $ | 10,744,483 | | | | | | | | | | | Chief Legal Officer | | | | 2022 | | | | $ | 872,917 | | | | $ | 4,900,000 | | | | $ | 4,314,238 | | | | $ | 4,439,975 | | | | | N/A | | | | $ | 152,953 | | | | $ | 14,680,083 | | | | | | 2021 | | | | $ | 850,000 | | | | $ | 4,850,000 | | | | $ | 3,807,873 | | | | $ | 879,999 | | | | | N/A | | | | $ | 186,810 | | | | $ | 10,574,682 | |
*(1) | Mr. Squeri succeededLe Caillec became an NEO in 2023 when he was promoted to Chief Financial Officer, therefore, no disclosure is included for Mr. Chenault as ChairmanLe Caillec for 2022 and CEO on February 1, 2018.2021. |
** | Mr. Buckminster was appointed Group President, Global Consumer Services on February 1, 2018.
| (1)(2) | The amounts in this column reflect AIA cash payments for annual performance. For Mr. Chenault, his entire 2017 AIA of $8,281,250 was paid in the form of RSUs granted in January 2018 that are deferred for one year. For Ms. Seeger, the 2017 amount also includes installments of a sign-on cash payment of $2,634,000 made in accordance with her employment offer letter to replace a portion of long-term incentives forfeited at her prior employer as a result of joining the Company. |
(2)(3) | Represents the aggregate grant date fair value of the awards pursuant to FASB ASC Topic 718, Compensation – Stock Compensation. Additional details on accounting for stock-based compensation can be found in Note 11, Stock Plans,10 Stock-Based Compensation, to our Consolidated Financial Statements contained in our 20172023 Annual Report on Form 10-K. | | A significant portion of Mr. Chenault’s TDC is delivered in the form of equity that is deferred. The table below provides detail on the RSUs included in the stock awards column:
|
| | 2017 | | 2016 | | 2015 | Annual RSU award granted in January for performance in the
prior year*** | | $ | 6,109,000 | | $ | 5,851,825 | | $ | 7,311,824 | Portion of AIA awarded in RSUs in January for performance in the
prior year*** | | $ | 3,025,959 | | $ | 3,974,964 | | $ | 3,599,893 | Payment of PG award in the form of RSUs. Amount in column reflects
the RSUs granted in January with respect to PG awards whose
performance periods ended the prior year | | $ | 3,074,978 | | $ | 2,982,738 | | $ | 5,427,328 | | TOTAL | | $ | 12,209,937 | | $ | 12,809,527 | | $ | 16,339,045 |
*** | For example, 2017 amount shows RSUs awarded in January 2017 for 2016 performance.
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Table of Contents
Compensation Discussion and Analysis2018 Proxy Statement
| With respect to the RSU awards for Mr. Chenault, the amount in the Stock Awards column of the Summary Compensation Table reflects the aggregate value of all of the awards set forth in the table above, including the target value of his annual RSU award, assuming that target performance is achieved against the average ROE target during the three-year performance period ($6,109,000). For all other executives, the amount in the Stock Awards column of the Summary Compensation Table reflects only the target value of their annual RSU awards, assuming that target performance is achieved against the average ROE target during the three-year performance period.
| | (4) | For each executive’s annual PRSUsNEO’s stock award, the maximum value as of the grant date, assuming the highest level of performance will be achieved and based on the closing price of the Company’s common shares on the NYSE on the grant date, is as follows: Messrs. Chenault ($7,636,250), Squeri, ($4,707,202),$21,359,863; Le Caillec, $2,999,981; Buckminster, $6,623,916; Campbell, ($2,530,645)$6,047,878; and Buckminster ($2,024,562)Williams, $5,567,881; and Ms. Seeger, ($2,024,562).$4,511,846. |
| Option Awards include performance-vesting options granted on October 31, 2017 to Mr. Squeri with a grant date fair value of $4,500,000 in connection with his promotion and to Mr. Buckminster, with a grant date fair value of $2,250,000, in connection with the CEO transition.
| (3)(5) | The 2017 amounts in this column reflect the cash payment made to the NEO in respect of a payout under the PG 2015-17 awards granted in 2015, in accordance with award terms. For Mr. Chenault, the 2017 amount excludes payment of $4,048,750 which was made in the form of RSUs granted in January 2018 that are deferred for one year.
| (4) | The amounts in this column reflect the actuarial increase or decrease in the present value of the NEOs’ benefits under all defined benefit pension plans established by the Company. The amounts reflect the impact of changes in interest rates and the NEOs’ changes in age during the year which are used to measure the present value. When interest rates fall, as they did during 2017,Messrs. Le Caillec and Campbell, and Ms. Seeger are not eligible to participate in the present value of thisdefined benefit will increase, but this increase does not represent any additional benefitplan due to their employment commencement dates in the executive.U.S. |
(5)(6) | See the All“All Other Compensation Table belowCompensation” table on the following page for additional information. |
2024 PROXY STATEMENT 75 • All Other Compensation | Name | | Year | | Perquisites
and
Other
Personal
Benefits(1) | Tax Payments/
Reimbursements(2) | | Company
Contributions
to Defined
Contribution
Plans(3) | | Executive Life
Insurance(4) | | Total | | K.I. Chenault | | 2017 | | $ | 298,717 | $ N/A | | $ | 356,731 | | $ | 7,588 | | $ | 663,036 | | | 2016 | | $ | 285,310 | $ N/A | | $ | 270,000 | | $ | 6,848 | | $ | 562,158 | | | 2015 | | $ | 259,358 | $ N/A | | $ | 520,000 | | $ | 6,075 | | $ | 785,433 | | S.J. Squeri | | 2017 | | $ | 101,831 | $ N/A | | $ | 415,709 | | $ | 3,353 | | $ | 520,893 | | | 2016 | | $ | 79,472 | $ N/A | | $ | 303,750 | | $ | 3,040 | | $ | 386,262 | | | 2015 | | $ | 82,973 | $ N/A | | $ | 274,249 | | $ | 2,743 | | $ | 359,965 | | J.C. Campbell | | 2017 | | $ | 72,170 | $ N/A | | $ | 232,212 | | $ | 7,740 | | $ | 312,122 | | | 2016 | | $ | 73,248 | $ N/A | | $ | 150,000 | | $ | 7,740 | | $ | 230,988 | | | 2015 | | $ | 74,663 | $ N/A | | $ | 140,000 | | $ | 7,740 | | $ | 222,403 | | D.E. Buckminster | | 2017 | | $ | 96,944 | $ N/A | | $ | 221,858 | | $ | 2,915 | | $ | 321,717 | | | 2016 | | $ | 86,303 | $ N/A | | $ | 157,500 | | $ | 2,624 | | $ | 246,427 | | | 2015 | | $ | 60,909 | $ N/A | | $ | 130,778 | | $ | 2,409 | | $ | 194,096 | | L.E. Seeger | | 2017 | | $ | 72,170 | $ N/A | | $ | 185,769 | | $ | 7,740 | | $ | 265,679 | | | 2016 | | $ | 72,369 | $ N/A | | $ | 120,000 | | $ | 7,740 | | $ | 200,109 | | | 2015 | | $ | 43,645 | $ N/A | | $ | 109,846 | | $ | 4,140 | | $ | 157,631 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Name | | Year | | Perquisites
and Other
Personal
Benefits(1) | | Tax Payments/
Reimbursements(2) | | Company
Contributions
to Defined
Contribution
Plans(3) | | Executive
Life
Insurance(4) | | Total | | | | | | | | S.J. Squeri | | | | 2023 | | | | $ | 378,872 | | | | | N/A | | | | $ | 240,000 | | | | $ | 6,255 | | | | $ | 625,127 | | | | | | | | | C.Y. Le Caillec | | | | 2023 | | | | $ | 12,200 | | | | $ | 33,667 | | | | $ | 113,530 | | | | $ | 7,740 | | | | $ | 163,137 | | | | | | | | | D. E. Buckminster | | | | 2023 | | | | $ | 119,902 | | | | $ | 0 | | | | $ | 176,000 | | | | $ | 5,288 | | | | $ | 301,189 | | | | | | | | | J.C. Campbell | | | | 2023 | | | | $ | 73,030 | | | | | N/A | | | | $ | 160,000 | | | | $ | 11,880 | | | | $ | 244,910 | | | | | | | | | A.D. Williams | | | | 2023 | | | | $ | 6,256 | | | | | N/A | | | | $ | 160,000 | | | | $ | 7,740 | | | | $ | 173,996 | | | | | | | | | L.E. Seeger | | | | 2023 | | | | $ | 3,600 | | | | | N/A | | | | $ | 140,000 | | | | $ | 11,880 | | | | $ | 155,480 | |
| (1) | See the Perquisites“Perquisites and Other Personal BenefitsBenefits” table below for additional information regarding the components of this column. |
| (2) | For Mr. Le Caillec, he was on international assignment in New York from France which ended on December 31, 2020 when he permanently moved to New York. Prior to his promotion to Chief Financial Officer and under his localization agreement, French voluntary social payments in the amount of $46,113 were made by the Company and included in compensation through payroll. The previously agreed arrangement ended in July of 2023. Additionally, the following is also reflected in the table: assignment-related compensation in the amount of $1,578 and prior year tax adjustments in the amount of ($14,024) which was returned to the Company. For Mr. Buckminster, who was on international assignment in London until June 2014, trailing tax equalization payments or reimbursements have been made and recorded following the termination of his assignment in 2014 in order to address any foreign tax obligations relating to income received, awarded or earned during his assignment. In 2017, Mr. Buckminster received2023, American Express realized a net foreign tax credit of approximately $78,714$385,000 relating to payments made by the Company on hisMr. Buckminster’s behalf in previous years. This amount was returned to the Company and is not reflected in the table above. |
| (3) | This column reflects Company contributions to the NEOs’ accounts under the Company’s RSP and the RRP-RSP Related Account.RRP-RSP. Seepages 81-8382-84 for a further description of the RSP and the RRP-RSP Related Account.RRP-RSP. |
| (4) | This column reflects income imputed to the NEONEOs under the Company’s executive life insurance program. |
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Perquisites and Other Personal Benefits | Name | | Year | | Local and
Other
Travel
Benefits(1) | | Personal
Use of
Company
Aircraft(2) | | Flexible
Perquisite
Allowance(3) | | Home
Security
System(4) | | Security
During
Personal
Trips(4) | | International
Assignment(5) | | Other
Benefits(6) | | Total | | K.I. Chenault | | 2017 | | $ | 21,391 | | $ | 184,555 | | $ | 35,000 | | $ | 30,319 | | $ 19,510 | | | N/A | | $ | 7,942 | | $ | 298,717 | | | 2016 | | $ | 19,731 | | $ | 152,538 | | $ | 35,000 | | $ | 48,715 | | $ 15,111 | | | N/A | | $ | 14,215 | | $ | 285,310 | | | 2015 | | $ | 13,089 | | $ | 145,611 | | $ | 35,000 | | $ | 30,570 | | $ 23,234 | | | N/A | | $ | 11,854 | | $ | 259,358 | | S.J. Squeri | | 2017 | | $ | 30,000 | | $ | 20,354 | | $ | 35,000 | | | N/A | | N/A | | | N/A | | $ | 16,477 | | $ | 101,831 | | | 2016 | | $ | 30,000 | | $ | 0 | | $ | 35,000 | | | N/A | | N/A | | | N/A | | $ | 14,472 | | $ | 79,472 | | | 2015 | | $ | 30,000 | | $ | 0 | | $ | 35,000 | | | N/A | | N/A | | | N/A | | $ | 17,973 | | $ | 82,973 | | J.C. Campbell | | 2017 | | $ | 30,000 | | $ | 0 | | $ | 35,000 | | | N/A | | N/A | | | N/A | | $ | 7,170 | | $ | 72,170 | | | 2016 | | $ | 30,000 | | $ | 0 | | $ | 35,000 | | | N/A | | N/A | | | N/A | | $ | 8,248 | | $ | 73,248 | | | 2015 | | $ | 30,000 | | $ | 0 | | $ | 35,000 | | | N/A | | N/A | | | N/A | | $ | 9,663 | | $ | 74,663 | | D.E. Buckminster | | 2017 | | $ | 30,000 | | $ | 0 | | $ | 35,000 | | | N/A | | N/A | | $ | 31,225 | | $ | 719 | | $ | 96,944 | | | 2016 | | $ | 30,000 | | $ | 0 | | $ | 35,000 | | | N/A | | N/A | | $ | 19,608 | | $ | 1,695 | | $ | 86,303 | | | 2015 | | $ | 0 | | $ | 0 | | $ | 35,000 | | | N/A | | N/A | | $ | 24,021 | | $ | 1,888 | | $ | 60,909 | | L.E. Seeger | | 2017 | | $ | 30,000 | | $ | 0 | | $ | 35,000 | | | N/A | | N/A | | | N/A | | $ | 7,170 | | $ | 72,170 | | | 2016 | | $ | 30,000 | | $ | 0 | | $ | 35,000 | | | N/A | | N/A | | | N/A | | $ | 7,369 | | $ | 72,369 | | | 2015 | | $ | 0 | | $ | 0 | | $ | 35,000 | | | N/A | | N/A | | | N/A | | $ | 8,645 | | $ | 43,645 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Name | | Year | | Local and
Other
Travel
Benefits(1) | | Personal
Use of
Company
Aircraft(1),(2) | | Personal
Security(3) | | International
Assignment/
Relocation(4) | | Other
Benefits(5) | | Total | | | | | | | | | S.J. Squeri | | | | 2023 | | | | $ | 37,040 | | | | $ | 199,699 | | | | $ | 138,532 | | | | $ | 0 | | | | $ | 3,600 | | | | $ | 378,872 | | | | | | | | | | C.Y. Le Caillec | | | | 2023 | | | | | N/A | | | | $ | 0 | | | | | N/A | | | | $ | 8,600 | | | | $ | 3,600 | | | | $ | 12,200 | | | | | | | | | | D.E. Buckminster | | | | 2023 | | | | | N/A | | | | $ | 111,302 | | | | | N/A | | | | $ | 8,600 | | | | $ | 0 | | | | $ | 119,902 | | | | | | | | | | J.C. Campbell | | | | 2023 | | | | | N/A | | | | $ | 73,030 | | | | | N/A | | | | $ | 0 | | | | $ | 0 | | | | $ | 73,030 | | | | | | | | | | A.D. Williams | | | | 2023 | | | | | N/A | | | | $ | 2,656 | | | | | N/A | | | | $ | 0 | | | | $ | 3,600 | | | | $ | 6,256 | | | | | | | | | | L.E. Seeger | | | | 2023 | | | | | N/A | | | | $ | 0 | | | | | N/A | | | | $ | 0 | | | | $ | 3,600 | | | | $ | 3,600 | |
| (1) | For 2017, local and other travel benefits include localLocal travel allowance for NEOs other thanonly applies to Mr. Chenault. For Mr. Chenault, theSqueri. The Company’s security policy requires himthe CEO to use for all travel purposes, to the maximum extent practicable, the automobiles and aircraft provided by the Company to executives for business travel. The calculation of the incremental cost for personal use of Company-owned automobiles and aircraft is based on the variable cost to the Company of operating the automobiles and aircraft and includes, among other things, fuel costs, maintenance costs and, in the case of aircraft, the cost of trip-related crew hotels and meals, and landing and ground handling fees.fees and trip-related crew costs for hotels and meals. The calculation does not include fixed costs that would have been incurred regardless of whether there was any personal use of the automobiles or aircraft (e.g., purchase costs and depreciation, driver and flight crew fixed salaries and benefits, insurance costs, etc.).
|
| (2) | Effective January 1, 2010,The CEO’s personal use of Company aircraft is limited to $200,000 per year and the CEO is required to reimburse the Company required reimbursement by Mr. Chenault forany incremental costs in excess of $200,000 per year for travel on Company aircraft that is deemed by the SEC to be personal use, including use to travel to outside board meetings. Mr. Squeri’s 2017use. Messrs. Buckminster, Campbell and Williams amounts arewere in connection with business meetings, although were deemed personal travelor mixed business/personal, in accordance with appropriate approvals.our policy, given the flights were to and from personal residences or to an alternate destination en route to the final destination.
|
| (3) | The amount in this column reflects the perquisite allowance paid to the NEOs. | (4) | The amounts in these columns includeincludes costs associated with home security and security during personal trips for Mr. Chenault.Squeri in accordance to the Company’s security policy.
|
(5)(4) | TheFor Mr. Le Caillec, the amounts shown include expatriateinternational tax and reporting services (not payments or reimbursements) in connection with his localization to the U.S. from France. For Mr. Buckminster’sBuckminster, the amounts shown include international tax and reporting services (not payments or reimbursements) in connection with his repatriation to the United States,U.S. due to his international assignments.trailing tax liabilities. The services provided to Mr.Messrs. Le Caillec and Buckminster are provided to all employeescolleagues on international assignment.
|
(6)(5) | This column reflects the aggregate amount of other perquisites and personal benefits provided, none of which individually exceeded the greater of $25,000 or 10 percent10% of the total amount of all perquisites and other personal benefits reported for the NEO. TheseIn 2023, other benefits consistconsisted of office parking, reimbursement for certain information technology services, and, on occasion, use of the Company’s tickets for sporting and entertainment events for personal rather than business purposes.parking. We generally incur no incremental cost for the provision of such additional benefits. |
Table of Contents
Compensation Discussion and Analysis2018 Proxy Statement• 76 2024 PROXY STATEMENT
Grants of Plan-Based Awards The following table provides information on Incentive awards granted to each of our NEOs in 2017 underNEOs. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Name | | Award
Type(1) | | Grant
Date | | | Approval
Date | | | Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards(2) | | | Estimated Future Payouts
Under Equity Incentive
Plan Awards(2) | | Exercise
Price or
Base
Price of
Option
Awards
($/sh)(1) | | | Grant Date
Fair Value
of Stock
and Option
Awards
($)(3) | | | | Threshold
($) | | Target
($) | | | Maximum
($) | | | Threshold
(#) | | Target
(#) | | | Maximum
(#) | | | | | | | | | | | | | S.J. Squeri | | AIA | | | | | | | 1/24/2023 | | | $ 0 | | $ | 6,000,000 | | | $ | 11,250,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | SO | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | | | | 74,129 | | | | | $ | 173.61 | | | $ | 4,449,964 | | | | | | | | | | | | | | | | | PRSU | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | 0 | | | 102,528 | | | 123,033 | | | | | | $ | 19,287,280 | | | | | | | | | | | | | | C.Y. Le Caillec | | AIA | | | | | | | 1/24/2023 | | | $ 0 | | $ | 1,702,740 | | | $ | 3,192,637 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | PRSU | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | 0 | | | 14,400 | | | 17,280 | | | | | | $ | 2,708,888 | | | | | | | | | | | | | | D.E. Buckminster | | AIA | | | | | | | 1/24/2023 | | | $ 0 | | $ | 4,000,000 | | | $ | 7,500,000 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | SO | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | | | | 22,988 | | | | | $ | 173.61 | | | $ | 1,379,970 | | | | | | | | | | | | | | | | RSU | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | | | | 1,728 | | | | | | | | | $ | 299,998 | | | | | | | | | | | | | | | | | PRSU | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | 0 | | | 31,795 | | | 38,154 | | | | | | $ | 5,981,186 | | | | | | | | | | | | | | J.C. Campbell | | AIA | | | | | | | 1/24/2023 | | | $ 0 | | $ | 3,700,000 | | | $ | 6,937,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | SO | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | | | | 20,989 | | | | | $ | 173.61 | | | $ | 1,259,970 | | | | | | | | | | | | | | | | RSU | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | | | | 1,872 | | | | | | | | | $ | 324,998 | | | | | | | | | | | | | | | | | PRSU | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | 0 | | | 29,030 | | | 34,836 | | | | | | $ | 5,461,042 | | | | | | | | | | | | | | A.D. Williams | | AIA | | | | | | | 1/24/2023 | | | $ 0 | | $ | 3,700,000 | | | $ | 6,937,500 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | SO | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | | | | 19,323 | | | | | $ | 173.61 | | | $ | 1,159,960 | | | | | | | | | | | | | | | | RSU | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | | | | 1,368 | | | | | | | | | $ | 237,498 | | | | | | | | | | | | | | | | | PRSU | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | 0 | | | 26,726 | | | 32,071 | | | | | | $ | 5,027,620 | | | | | | | | | | | | | | L.E. Seeger | | AIA | | | | | | | 1/24/2023 | | | $ 0 | | $ | 2,925,000 | | | $ | 5,484,375 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | SO | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | | | | 15,658 | | | | | $ | 173.61 | | | $ | 939,950 | | | | | | | | | | | | | | | | RSU | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | | | | 1,152 | | | | | | | | | $ | 199,999 | | | | | | | | | | | | | | | | | PRSU | | | 2/1/2023 | | | | 1/24/2023 | | | | | | | | | | | | | 0 | | | 21,657 | | | 25,988 | | | | | | $ | 4,074,054 | |
(1) Award types Annual Incentive Award (AIA): The AIA is an annual cash-denominated performance-based component of executive compensation. Performance is measured against measurable goals and actual amounts paid are based on 2023 performance. Additional information regarding how the 2016 Incentive Compensation Plan.payout amounts for these awards are determined is on page 59. | | | | | | | | Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards(2) | | Estimated Future Payouts
Under Equity Incentive
Plan Awards(2) | | Exercise
Price or
Base Price
of Option | | Grant
Date Fair
Value of
Stock
and
Option | | Name | | Award
Type(1) | | Grant
Date | | Approval
Date | | Threshold
($) | | Target
($) | | Maximum
($) | | Threshold
(#) | | Target
(#) | | Maximum
(#) | | Awards
($/Sh)(3) | | Awards
($)(4) | | K.I. Chenault | | PG 2017-19 | | 1/24/2017 | | 1/23/2017 | | $0 | | $ | 7,664,000 | | $ | 9,580,000 | | | | | | | | | | | | | | | SO | | 1/24/2017 | | 1/23/2017 | | | | | | | | | | | | 176,072 | | | | $ | 77.43 | | $ | 3,200,989 | | | RSU | | 1/24/2017 | | 1/23/2017 | | | | | | | | | | | | 39,713 | | | | | | | $ | 3,074,978 | | | PRSU | | 1/24/2017 | | 1/23/2017 | | | | | | | | | | 0 | | 117,977 | | 147,471 | | | | | $ | 9,134,959 | | S.J. Squeri | | AIA | | | | 1/23/2017 | | $0 | | $ | 4,500,000 | | $ | 8,437,500 | | | | | | | | | | | | | | | PG 2017-19 | | 1/24/2017 | | 1/23/2017 | | $0 | | $ | 1,500,000 | | $ | 1,875,000 | | | | | | | | | | | | | | | SO | | 1/24/2017 | | 1/23/2017 | | | | | | | | | | | | 48,635 | | | | $ | 77.43 | | $ | 884,184 | | | PSO | | 10/31/2017 | | 10/18/2017 | | | | | | | | | | | | 234,619 | | | | $ | 95.52 | | $ | 4,499,992 | | | PRSU | | 1/24/2017 | | 1/23/2017 | | | | | | | | | | 0 | | 48,635 | | 60,793 | | | | | $ | 3,765,808 | | J.C. Campbell | | AIA | | | | 1/23/2017 | | $0 | | $ | 3,500,000 | | $ | 6,562,500 | | | | | | | | | | | | | | | PG 2017-19 | | 1/24/2017 | | 1/23/2017 | | $0 | | $ | 1,500,000 | | $ | 1,875,000 | | | | | | | | | | | | | | | SO | | 1/24/2017 | | 1/23/2017 | | | | | | | | | | | | 26,147 | | | | $ | 77.43 | | $ | 475,352 | | | PRSU | | 1/24/2017 | | 1/23/2017 | | | | | | | | | | 0 | | 26,147 | | 32,683 | | | | | $ | 2,024,562 | | D.E. Buckminster | | AIA | | | | 1/23/2017 | | $0 | | $ | 2,200,000 | | $ | 4,125,000 | | | | | | | | | | | | | | | PG 2017-19 | | 1/24/2017 | | 1/23/2017 | | $0 | | $ | 1,300,000 | | $ | 1,625,000 | | | | | | | | | | | | | | | SO | | 1/24/2017 | | 1/23/2017 | | | | | | | | | | | | 20,918 | | | | $ | 77.43 | | $ | 380,289 | | | PSO | | 10/31/2017 | | 10/18/2017 | | | | | | | | | | | | 117,309 | | | | $ | 95.52 | | $ | 2,249,987 | | | PRSU | | 1/24/2017 | | 1/23/2017 | | | | | | | | | | 0 | | 20,918 | | 26,147 | | | | | $ | 1,619,681 | | L.E. Seeger | | AIA | | | | 1/23/2017 | | $0 | | $ | 1,600,000 | | $ | 3,000,000 | | | | | | | | | | | | | | | PG 2017-19 | | 1/24/2017 | | 1/23/2017 | | $0 | | $ | 1,100,000 | | $ | 1,375,000 | | | | | | | | | | | | | | | SO | | 1/24/2017 | | 1/23/2017 | | | | | | | | | | | | 20,918 | | | | $ | 77.43 | | $ | 380,289 | | | PRSU | | 1/24/2017 | | 1/23/2017 | | | | | | | | | | 0 | | 20,918 | | 26,147 | | | | | $ | 1,619,681 |
(1) | AIA.The AIA is an annual cash-denominated performance-based component of executive compensation to recognize Company performance as well as exceptional individual performance. Performance is measured against measurable goals reviewed and approved by the CBC. The actual amounts paid are based on our 2017 performance reported above in the Bonus column in the Summary Compensation Table. Additional information regarding how the payout amounts for these awards are determined is onpages 63-66.
| | PG.These awards link compensation to our financial and strategic performance over a three-year period. The Company discloses the specific performance metric goals as well as the performance outcomes of each PG award at the end of the performance period so that shareholders can assess the appropriateness thereof. The Company does not disclose the goals at the time of grant due to competitive sensitivity. The potential award payout is determined based on a table of possible performance and earned payout levels, including a cap on the overall earned payout level. The actual payout could be higher or lower than the notional target value based on performance.
| | SO.The SOs have a ten-year term and 100 percentStock Options (SO): Options have a ten-year term and 100% of these shares become exercisable on the third anniversary of the grant date, subject to continued employment and positive cumulative net income over the three-year vesting period. The exercise price of these awards is the closing price of the Company’s common shares on the NYSE on the grant date. Performance Restricted Stock Units (PRSU): These awards vest on the third anniversary of the grant date subject to continued employment (with limited exceptions) and based on relative ROE and relative TSR performance during the performance period. See page 60 for additional information on our Performance Restricted Stock Unit program. Restricted Stock Units (RSU): For Messrs. Buckminster, Campbell and Williams and Ms. Seeger, RSUs were granted in connection with their 2022 AIA to comply with regulatory guidance. These RSUs are payable on the third anniversary of the grant date subject to positive cumulative net income over 2023-2025 and are not subject to continued employment.
2024 PROXY STATEMENT 77 • (2) Estimated future payouts under non-equity/equity incentive plan awards The amounts shown under these columns represent potential threshold, target and maximum payouts for achievement of performance levels for awards granted. AIA: Actual annual cash incentive payout amounts are determined by Company performance and an individual performance multiplier, ranging from 0% to 187.5% of target levels. Mr. Le Caillec’s AIA reflects the increase in his target AIA from $1.3 million to $2.35 million as a result of his promotion to the role of Chief Financial Officer in August 2023. Per Company policy, AIA was pro-rated considering his time in each role. PRSU: Actual number of shares that vest is determined by relative ROE and relative TSR multipliers, ranging from 0% to 120% of target levels. (3) Grant date fair value of stock awards Represents the aggregate grant date fair value of the awards pursuant to FASB ASC Topic 718, Compensation – Stock Compensation. Additional details on accounting for stock-based compensation can be found in Note 10, Stock-Based Compensation, to our Consolidated Financial Statements contained in our 2023 Annual Report on Form 10-K.
• 78 2024 PROXY STATEMENT Outstanding Equity Awards at Fiscal Year-End 2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Option Awards | | Stock Awards | Name | | Grant
Date | | Number
of
Securities
Underlying
Unexercised
Options
Exercisable
(#) | | Number of
Securities
Underlying
Unexercised
Options
Unexercisable
(#) | | Equity
Incentive
Plan
Awards:
Number
of
Securities
Underlying
Unexercised
Unearned
Options
(#) | | Option
Exercise
Price
($) | | Option
Expiration
Date | | Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units,
or
Other
Rights
that
Have
Not
Vested
(#) | | Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units, or
Other
Rights
that
Have
Not
Vested
($)(a) | | | | | | | | | | S.J. Squeri | | | | 2/1/2023 | | | | | | | | | | | | | | | 74,129 | (1) | | | $ | 173.61 | | | | | 2/1/2033 | | | | | 123,033 | (b) | | | $ | 23,049,002 | | | | | | | | | | | | | | | 10/31/2022 | | | | | | | | | | | | | | | 299,401 | (3) | | | $ | 148.45 | | | | | 10/31/2029 | | | | | | | | | | | | | | | | | | | | | | | | | 1/28/2022 | | | | | | | | | | | | | | | 68,716 | (1) | | | $ | 177.06 | | | | | 1/28/2032 | | | | | 103,015 | (b) | | | $ | 19,298,830 | | | | | | | | | | | | | | | 1/29/2021 | | | | | | | | | | | | | | | 90,766 | (1) | | | $ | 116.26 | | | | | 1/29/2031 | | | | | 115,740 | (b) | | | $ | 21,682,732 | | | | | | | | | | | | | | | 1/29/2020 | | | | | 112,272 | (1) | | | | — | | | | | | | | | $ | 131.68 | | | | | 1/29/2030 | | | | | | | | | | | | | | | | | | | | | | | | | 1/29/2019 | | | | | 104,407 | (1) | | | | — | | | | | | | | | $ | 100.96 | | | | | 1/29/2029 | | | | | | | | | | | | | | | | | | | | | | | | | | 1/23/2018 | | | | | 66,225 | (1) | | | | — | | | | | | | | | $ | 97.98 | | | | | 1/23/2028 | | | | | | | | | | | | | | | | | | | | | C.Y. Le Caillec | | | | 2/1/2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 17,280 | (b) | | | $ | 3,237,235 | | | | | | | | | | | | | | | 1/28/2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 9,318 | (b) | | | $ | 1,745,634 | | | | | | | | | | | | | | | 1/29/2021 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 8,231 | (b) | | | $ | 1,541,996 | | | | | | | | | | | | | | | | 4/29/2016 | | | | | 8,000 | (1) | | | | — | | | | | | | | | $ | 65.43 | | | | | 4/29/2026 | | | | | | | | | | | | | | | | | | | | | D.E. Buckminster | | | | 2/1/2023 | | | | | | | | | | | | | | | 22,988 | (1) | | | $ | 173.61 | | | | | 2/1/2033 | | | | | 38,154 | (b) | | | $ | 7,147,770 | | | | | | | | | | | | | | | 2/1/2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,728 | (c) | | | $ | 323,724 | | | | | | | | | | | | | | | 1/28/2022 | | | | | | | | | | | | | | | 24,954 | (1) | | | $ | 177.06 | | | | | 1/28/2032 | | | | | 37,410 | (b) | | | $ | 7,008,389 | | | | | | | | | | | | | | | 1/28/2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 988 | (c) | | | $ | 185,092 | | | | | | | | | | | | | | | 1/29/2021 | | | | | | | | | | | | | | | 36,932 | (1) | | | $ | 116.26 | | | | | 1/29/2031 | | | | | 47,093 | (b) | | | $ | 8,822,403 | | | | | | | | | | | | | | | 1/29/2020 | | | | | 45,683 | (1) | | | | — | | | | | | | | | $ | 131.68 | | | | | 1/29/2030 | | | | | | | | | | | | | | | | | | | | | | | | | 1/29/2019 | | | | | 41,078 | (1) | | | | — | | | | | | | | | $ | 100.96 | | | | | 1/29/2029 | | | | | | | | | | | | | | | | | | | | | | | | | 4/30/2018 | | | | | 8,093 | (1) | | | | — | | | | | | | | | $ | 98.75 | | | | | 4/30/2028 | | | | | | | | | | | | | | | | | | | | | | | | | 1/23/2018 | | | | | 18,237 | (1) | | | | — | | | | | | | | | $ | 97.98 | | | | | 1/23/2028 | | | | | | | | | | | | | | | | | | | | | | | | | 10/31/2017 | | | | | 117,309 | (2) | | | | — | | | | | | | | | $ | 95.52 | | | | | 10/31/2024 | | | | | | | | | | | | | | | | | | | | | | | | | 1/24/2017 | | | | | 20,918 | (1) | | | | — | | | | | | | | | $ | 77.43 | | | | | 1/24/2027 | | | | | | | | | | | | | | | | | | | | | | | | | 1/26/2016 | | | | | 23,505 | (1) | | | | — | | | | | | | | | $ | 55.09 | | | | | 1/26/2026 | | | | | | | | | | | | | | | | | | | | | | | | | | 1/26/2015 | | | | | 13,111 | (1) | | | | — | | | | | | | | | $ | 83.30 | | | | | 1/26/2025 | | | | | | | | | | | | | | | | | | | | | J.C. Campbell | | | | 2/1/2023 | | | | | | | | | | | | | | | 20,989 | (1) | | | $ | 173.61 | | | | | 2/1/2033 | | | | | 34,836 | (b) | | | $ | 6,526,176 | | | | | | | | | | | | | | | 2/1/2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,872 | (c) | | | $ | 350,700 | | | | | | | | | | | | | | | 1/28/2022 | | | | | | | | | | | | | | | 22,784 | (1) | | | $ | 177.06 | | | | | 1/28/2032 | | | | | 34,156 | (b) | | | $ | 6,398,785 | | | | | | | | | | | | | | | 1/28/2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,129 | (c) | | | $ | 211,507 | | | | | | | | | | | | | | | 1/29/2021 | | | | | | | | | | | | | | | 33,176 | (1) | | | $ | 116.26 | | | | | 1/29/2031 | | | | | 42,304 | (b) | | | $ | 7,925,231 | | | | | | | | | | | | | | | 1/29/2020 | | | | | 41,037 | (1) | | | | — | | | | | | | | | $ | 131.68 | | | | | 1/29/2030 | | | | | | | | | | | | | | | | | | | | | | | | | 1/29/2019 | | | | | 38,510 | (1) | | | | — | | | | | | | | | $ | 100.96 | | | | | 1/29/2029 | | | | | | | | | | | | | | | | | | | | | | | | | 4/30/2018 | | | | | 4,046 | (1) | | | | — | | | | | | | | | $ | 98.75 | | | | | 4/30/2028 | | | | | | | | | | | | | | | | | | | | | | | | | 1/23/2018 | | | | | 27,770 | (1) | | | | — | | | | | | | | | $ | 97.98 | | | | | 1/23/2028 | | | | | | | | | | | | | | | | | | | | | | | | | 1/24/2017 | | | | | 26,147 | (1) | | | | — | | | | | | | | | $ | 77.43 | | | | | 1/24/2027 | | | | | | | | | | | | | | | | | | | | | | | | | 1/26/2016 | | | | | 36,726 | (1) | | | | — | | | | | | | | | $ | 55.09 | | | | | 1/26/2026 | | | | | | | | | | | | | | | | | | | | | | | | | | 1/26/2015 | | | | | 25,777 | (1) | | | | — | | | | | | | | | $ | 83.30 | | | | | 1/26/2025 | | | | | | | | | | | |
2024 PROXY STATEMENT 79 • | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Option Awards | | Stock Awards | Name | | Grant
Date | | Number
of
Securities
Underlying
Unexercised
Options
Exercisable
(#) | | Number of
Securities
Underlying
Unexercised
Options
Unexercisable
(#) | | Equity
Incentive
Plan
Awards:
Number
of
Securities
Underlying
Unexercised
Unearned
Options
(#) | | Option
Exercise
Price
($) | | Option
Expiration
Date | | Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units,
or
Other
Rights
that
Have
Not
Vested
(#) | | Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units, or
Other
Rights
that
Have
Not
Vested
($)(a) | | | | | | | | | | A.D. Williams | | | | 2/1/2023 | | | | | | | | | | | | | | | 19,323 | (1) | | | $ | 173.61 | | | | | 2/1/2033 | | | | | 32,071 | (b) | | | $ | 6,008,181 | | | | | | | | | | | | | | | 2/1/2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,368 | (c) | | | $ | 256,281 | | | | | | | | | | | | | | | 10/31/2022 | | | | | | | | | | | | | | | 89,820 | (3) | | | $ | 148.45 | | | | | 10/31/2029 | | | | | | | | | | | | | | | | | | | | | | | | | 1/28/2022 | | | | | | | | | | | | | | | 20,976 | (1) | | | $ | 177.06 | | | | | 1/28/2032 | | | | | 31,446 | (b) | | | $ | 5,891,094 | | | | | | | | | | | | | | | 1/28/2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,341 | (c) | | | $ | 251,223 | | | | | | | | | | | | | | | 4/30/2021 | | | | | | | | | | | | | | | 4,257 | (1) | | | $ | 153.35 | | | | | 4/30/2031 | | | | | 5,747 | (b) | | | $ | 1,076,643 | | | | | | | | | | | | | | | 1/29/2021 | | | | | | | | | | | | | | | 30,359 | (1) | | | $ | 116.26 | | | | | 1/29/2031 | | | | | 38,712 | (b) | | | $ | 7,252,306 | | | | | | | | | | | | | | | 1/29/2020 | | | | | 37,553 | (1) | | | | — | | | | | | | | | $ | 131.68 | | | | | 1/29/2030 | | | | | | | | | | | | | | | | | | | | | | | | | | 1/29/2019 | | | | | 35,087 | (1) | | | | — | | | | | | | | | $ | 100.96 | | | | | 1/29/2029 | | | | | | | | | | | | | | | | | | | | | L.E. Seeger | | | | 2/1/2023 | | | | | | | | | | | | | | | 15,658 | (1) | | | $ | 173.61 | | | | | 2/1/2033 | | | | | 25,988 | (b) | | | $ | 4,868,592 | | | | | | | | | | | | | | | 2/1/2023 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1,152 | (c) | | | $ | 215,816 | | | | | | | | | | | | | | | 10/31/2022 | | | | | | | | | | | | | | | 69,860 | (3) | | | $ | 148.45 | | | | | 10/31/2029 | | | | | | | | | | | | | | | | | | | | | | | | | 1/28/2022 | | | | | | | | | | | | | | | 16,998 | (1) | | | $ | 177.06 | | | | | 1/28/2032 | | | | | 25,482 | (b) | | | $ | 4,773,798 | | | | | | | | | | | | | | | 1/28/2022 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 847 | (c) | | | $ | 158,677 | | | | | | | | | | | | | | | 1/29/2021 | | | | | | | | | | | | | | | 27,543 | (1) | | | $ | 116.26 | | | | | 1/29/2031 | | | | | 35,120 | (b) | | | $ | 6,579,381 | | | | | | | | | | | | | | | | 1/29/2020 | | | | | 34,068 | (1) | | | | — | | | | | | | | | $ | 131.68 | | | | | 1/29/2030 | | | | | | | | | | | |
Exercisability of option awards and vesting of stock awards is subject to continuous employment by the Company, except as noted below. Unvested awards may vest upon death, disability, termination, retirement or change in control of the Company as described on pages 85-87. Notes Relating to Option Award | (1) | These SOs vest 100% on the third anniversary of the grant date, subject to the Company achieving positive Cumulative Net Incomecumulative net income and continued employment over the vesting period.three-year performance period starting with the year of grant. |
| (2) | PSO.These PSOs willSOs vested on October 31, 2020 and have a term of seven years, an exercise price equal to the closing price on the grant date and vesting subject to (i) a stock price goal of 30 percent above the closing price on the grant date, which must be met for a period of 20 consecutive trading days during the five-year period beginning on the grant date, (ii) a financial goal of positive cumulative GAAP Net Incomenet income for the three-year period and (iii) a three-year service condition. The stock price goal was satisfied during 2019. Fifty percent of the net after-tax shares received upon exercise must be held for at least 12 months.
|
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Table of Contents
2018 Proxy Statement Compensation Discussion and Analysis
| (3) | PRSU.Except as specified otherwise, RSU awards will be granted with performance-based awards vestingThese Performance Stock Options (PSOs) (2022 Special Award) vest 75% on October 31, 2025 and 25% on October 31, 2026 and have a term of seven years, an exercise price equal to the third anniversary ofclosing price on the grant date inand vest subject to (i) an amount determined based on performance against the average ROE targetabsolute TSR goal of 40 percent above baseline TSR during the three-year performance period.
| | The 39,713 RSUs granted to Mr. Chenault are in connection with his PG 2014-16 payout and will vestfour-year period beginning on the first anniversary of the grant date subject(based on a 20 consecutive trading average price), (ii) positive cumulative GAAP net income for the three-year period Q3 2022 through Q2 2025 (with respect to the performance hurdle of positive Cumulative Net Income over the vesting period. One half of these RSUs are payable in cash and the other half are payable in shares (net shares must be held until one year after retirement). Dividend equivalents on RSUs will accrue but will not be paid unless and until the underlying shares vest.
| (2) | The amounts shown under these columns represent potential aggregate threshold, target and maximum payouts for achievement of threshold, target and maximum performance levels for awards granted. The “threshold” payout is zero, since it represents the level of performance for which no award would be earned. The “target” payout is equal to 10075 percent of the NEO’s grant valueoptions) and represents the amount thatfour-year period Q3 2022 through Q2 2026 (with respect to 25 percent of the options), and (iii) time-based service requirements (75% after 3 years, 25% after 4 years) assuming the performance conditions have been met. No options may be paid for achieving the target level of performance across all performance goals. The “maximum” payout (125 percent for PG and 187.5 percent for AIA) represents the amount that may be paid for achievingexercised until on or exceeding the maximum level of performance across all performance goals, subject to an overall cap on the payout amount.
| (3) | The exercise price of the SOs is the closing price of the Company’s common shares on the NYSE on the grant date.
| (4) | Represents the aggregate grant date fair value of the awards pursuant to FASB ASC Topic 718, Compensation – Stock Compensation. Additional details on accounting assumptions for stock-based compensation are referenced in footnote 2 of the Summary Compensation Table.
| | All awards are subject to continuous employment with the Company (unless specified otherwise), except awards may vest upon death, disability termination, retirement or, in certain circumstances, in connection with a change in control of the Company, as described in the Potential Payments Upon Termination or CIC Table.
|
Table of Contents
Compensation Discussion and Analysis2018 Proxy Statement
Outstanding Equity Awards at Fiscal Year-End 2017
The following table shows the number of shares outstanding for our NEOs on December 31, 2017.
| | Option Awards | | Stock Awards | | Name | | Grant
Date | | Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable | | | Number of
Securities
Underlying
Unexercised
Options (#)
Unexercisable | | Equity
Incentive
Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options
(#) | | | Option
Exercise
Price
($) | | Option
Expiration
Date | | Number
of Shares
or Units
of Stock
that
have Not
Vested
(#) | | Market
Value of
Shares or
Units of
Stock that
have Not
Vested
($)(a) | | Equity
Incentive
Plan Awards:
Number of
Unearned
Shares, Units,
or Other
Rights that
have Not
Vested
(#) | | | Equity
Incentive
Plan
Awards:
Market
or Payout
Value of
Unearned
Shares,
Units, or
Other Rights
that have
Not Vested
($)(a) | | K.I. Chenault | | 1/24/2017 | | | | | | | 176,072 | (1) | | $ | 77.43 | | 1/24/2027 | | | | | | 39,713 | (b) | | $ | 3,943,898 | | | 1/24/2017 | | | | | | | | | | | | | | | | | | | 117,977 | (c) | | $ | 11,716,296 | | | 1/26/2016 | | | | | | | 121,198 | (1) | | $ | 55.09 | | 1/26/2026 | | | | | | 106,223 | (c) | | $ | 10,549,006 | | | 1/26/2015 | | | | | | | 87,777 | (1) | | $ | 83.30 | | 1/26/2025 | | | | | | 87,777 | (c) | | $ | 8,717,134 | | | 1/28/2014 | | 78,361 | (1) | | — | | | | | $ | 86.64 | | 1/28/2024 | | | | | | | | | | | | | 1/29/2013 | | 103,786 | (1) | | — | | | | | $ | 59.45 | | 1/29/2023 | | | | | | | | | | | | | 1/24/2012 | | 123,706 | (2) | | — | | | | | $ | 49.23 | | 1/24/2022 | | | | | | | | | | | | | 1/27/2011 | | 135,981 | (2) | | — | | | | | $ | 44.54 | | 1/27/2021 | | | | | | | | | | | | | 1/26/2010 | | 650,918 | (2) | | — | | | | | $ | 38.10 | | 1/26/2020 | | | | | | | | | | | | | 1/29/2009 | | 118,888 | (2) | | — | | | | | $ | 16.71 | | 1/29/2019 | | | | | | | | | | | | S.J. Squeri | | 10/31/2017 | | | | | | | 234,619 | (4) | | $ | 95.52 | | 10/31/2024 | | | | | | | | | | | | | 1/24/2017 | | | | | | | 48,635 | (1) | | $ | 77.43 | | 1/24/2027 | | | | | | 48,635 | (c) | | $ | 4,829,942 | | | 1/26/2016 | | | | | | | 68,312 | (1) | | $ | 55.09 | | 1/26/2026 | | | | | | 68,312 | (c) | | $ | 6,784,065 | | | 10/30/2015 | | | | | | | | | | | | | | | | | | | 68,250 | (d) | | $ | 6,777,908 | | | 1/26/2015 | | | | | | | 27,777 | (1) | | $ | 83.30 | | 1/26/2025 | | | | | | 27,777 | (c) | | $ | 2,758,534 | | | 1/28/2014 | | 26,260 | (1) | | — | | | | | $ | 86.64 | | 1/28/2024 | | | | | | | | | | | | | 1/29/2013 | | 33,652 | (1) | | — | | | | | $ | 59.45 | | 1/29/2023 | | | | | | | | | | | | J.C. Campbell | | 1/24/2017 | | | | | | | 26,147 | (1) | | $ | 77.43 | | 1/24/2027 | | | | | | 26,147 | (c) | | $ | 2,596,659 | | | 1/26/2016 | | | | | | | 36,726 | (1) | | $ | 55.09 | | 1/26/2026 | | | | | | 36,726 | (c) | | $ | 3,647,259 | | | 1/26/2015 | | | | | | | 25,777 | | | $ | 83.30 | | 1/26/2025 | | | | | | 25,777 | (c) | | $ | 2,559,914 | | | 1/28/2014 | | 21,008 | (1) | | — | | | | | $ | 86.64 | | 1/28/2024 | | | | | | | | | | | | | 7/31/2013 | | 24,892 | (3) | | — | | | | | $ | 73.77 | | 7/31/2023 | | | | | | | | | | | | | 7/31/2013 | | 49,785 | (1) | | — | | | | | $ | 73.77 | | 7/31/2023 | | | | | | | | | | | | D.E. Buckminster | | 10/31/2017 | | | | | | | 117,309 | (4) | | $ | 95.52 | | 10/31/2024 | | | | | | | | | | | | | 1/24/2017 | | | | | | | 20,918 | (1) | | $ | 77.43 | | 1/24/2027 | | | | | | 20,918 | (c) | | $ | 2,077,367 | | | 1/26/2016 | | | | | | | 23,505 | (1) | | $ | 55.09 | | 1/26/2026 | | | | | | 23,505 | (c) | | $ | 2,334,282 | | | 1/26/2015 | | | | | | | 13,111 | (1) | | $ | 83.30 | | 1/26/2025 | | | | | | 13,111 | (c) | | $ | 1,302,053 | | | 1/28/2014 | | 11,344 | (1) | | — | | | | | $ | 86.64 | | 1/28/2024 | | | | | | | | | | | | | 1/29/2013 | | 16,354 | (1) | | — | | | | | $ | 59.45 | | 1/29/2023 | | | | | | | | | | | | | 1/24/2012 | | 19,493 | (2) | | — | | | | | $ | 49.23 | | 1/24/2022 | | | | | | | | | | | | | 1/27/2011 | | 19,779 | (2) | | — | | | | | $ | 44.54 | | 1/27/2021 | | | | | | | | | | | | | 1/26/2010 | | 94,488 | (2) | | — | | | | | $ | 38.10 | | 1/26/2020 | | | | | | | | | | | | L.E. Seeger | | 1/24/2017 | | | | | | | 20,918 | (1) | | $ | 77.43 | | 1/24/2027 | | | | | | 20,918 | (c) | | $ | 2,077,367 | | | 1/26/2016 | | | | | | | 29,381 | (1) | | $ | 55.09 | | 1/26/2026 | | | | | | 29,381 | (c) | | $ | 2,917,827 | | | 1/26/2015 | | | | | | | 17,777 | (1) | | $ | 83.30 | | 1/26/2025 | | | | | | 17,777 | (c) | | $ | 1,765,434 |
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Table of Contents
2018 Proxy Statement Compensation Discussion and Analysis
Unless specified otherwise, exercisability of option awards and vesting of stock awards is subject to continuous employment by the Company, except that unvested awards may vest upon death, disability, termination, retirement or change in control of the Company as described onpages 84-87.
Notes Relating to Option Awards
(1) | These SOs vest 100 percent on the third anniversary of the grant date, subject to positive Cumulative Net Income over the three-year performance period starting with the year of grant.
| (2) | These SOs vested 25 percent on the first, second, third and fourth anniversaries of the grant date.
| (3) | These SOs vested on January 29, 2016 as a result of satisfaction of the performance criteria, which was positive Cumulative Net Income over the three-year performance period (2013-2015).
| (4) | These SOs vest onafter October 31, 2020 subject to terms as explained onpage 63.2026.
|
• 80 2024 PROXY STATEMENT Notes Relating to Stock AwardsAward | (a) | The market value of the stock awards is based on the closing price per share of our stock on December 31, 2017,2023 which was $99.31.$187.34. |
| (b) | These awards vest on the first anniversary of the grant date subject to positive Cumulative Net Income. One half of these RSUs is payable in cash and the other half is payable in shares (net shares must be held until one year after retirement).
| (c) | These awards vest on the third anniversary of the grant date, subject to our achieving average annualcontinued employment and the Company’s relative ROE of 23-27 percent forand TSR, as compared to the 2017, 2016 and 2015 awards over the vesting period.Company’s Performance Peers listed on page 60. The number of awards above reflects thatshown is based on previous fiscal year’s performance ROE is at target and a payout at 100 percent is made based upon the trend in the ROE performance and projected payout as of December 31, 2017.2023. |
(d)(c) | For Mr. Squeri, an award of 68,250 RSUs was granted in connection with his promotion to Vice Chairman of the Company. These awards vestwill be payable on the third anniversary of the grant date subject to positive Cumulative Net Income.cumulative net income and are not subject to continued employment.
|
2024 PROXY STATEMENT 81 • Option Exercises and Stock Vested in 20172023 The following table contains information about exercises of SOsStock Options by the NEOs and shares acquired by the NEOs upon the vesting of Performance RSUs, in each case during 2017.2023. | | Option Awards | | Stock Awards | | Name | | Number
of Shares
Acquired on
Exercise
(#) | | Value Realized
on Exercise
($)(1) | | Number of
Shares
Acquired
on Vesting
(#) | | Value Realized
on Vesting
($)(2) | | K.I. Chenault | | 1,078,000 | | $ | 74,697,297 | | 204,658 | | $ | 15,733,019 | | S.J. Squeri | | 70,451 | | $ | 2,703,777 | | 41,266 | | $ | 3,171,892 | | J.C. Campbell | | — | | | — | | 21,008 | | $ | 1,614,465 | | D.E. Buckminster | | 150,000 | | $ | 6,086,565 | | 11,344 | | $ | 871,786 | | L.E. Seeger | | — | | | — | | 28,409 | | $ | 2,409,083 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 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) | | | | | | | S.J. Squeri | | | | — | | | | | — | | | | | | | | | | 102,186 | | | | $ | 17,607,670 | | | | | | | | C.Y. Le Caillec | | | | — | | | | | — | | | | | | | | | | 21,335 | | | | $ | 3,555,201 | | | | | | | | D.E. Buckminster | | | | 11,344 | | | | $ | 819,408 | | | | | | | | | | 41,579 | | | | $ | 7,164,477 | | | | | | | | J.C. Campbell | | | | 21,008 | | | | $ | 1,716,181 | | | | | | | | | | 38,109 | | | | $ | 6,566,562 | | | | | | | | A.D. Williams | | | | — | | | | | — | | | | | | | | | | 34,179 | | | | $ | 5,889,383 | | | | | | | | L.E. Seeger | | | | — | | | | | — | | | | | | | | | | 31,007 | | | | $ | 5,342,816 | |
| (1) | Amounts reflect the difference between the exercise price of the SO and the market price of our common stock at the time of exercise. |
| (2) | Amounts reflect the market value of our common stock on the day on which the RSUsPRSUs vested. |
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Compensation Discussion and Analysis2018 Proxy Statement• 82 2024 PROXY STATEMENT
Retirement Plan Benefits The table below shows the present value of accumulated benefits (PVAB) payable to each of the NEOs under the American Express Retirement Plan (Retirement Plan) and the Retirement Plan component of the American Express RRP,Retirement Restoration Plan (RRP-Retirement Plan), a nonqualified plan, except for Mr.Messrs. Campbell and Le Caillec and Ms. Seeger who are not eligible to participate in these plans.plans due to their employment commencement dates. Pension Benefits 20172023 | Name | | Plan Name | | Number of
Years Credited
Service
(#) | | PVAB
($)(1) | | Payments During
Last Fiscal Year
($) | | K.I. Chenault | | Retirement Plan | | 36 | | $ | 842,668 | | | $0 | | | RRP-Retirement Plan | | | | $ | 9,164,519 | | | $0 | | | Total | | | | $ | 10,007,187 | | | $0 | | S.J. Squeri | | Retirement Plan | | 32 | | $ | 357,783 | | | $0 | | | RRP-Retirement Plan | | | | $ | 669,079 | | | $0 | | | Total | | | | $ | 1,026,862 | | | $0 | | D.E. Buckminster | | Retirement Plan | | 31 | | $ | 325,057 | | | $0 | | | RRP-Retirement Plan | | | | $ | 422,211 | | | $0 | | | Total | | | | $ | 747,268 | | | $0 |
| | | | | | | | | | | | | | | | Name | | Plan Name | | Number of Years
Credited Service
(#) | | PVAB ($)(1) | | | Payments During Last Fiscal Year ($) | | | | | | S.J. Squeri | | Retirement Plan | | 38 | | $ | 439,200 | | | $0 | | | | | | | | RRP-Retirement Plan | | | | $ | 821,336 | | | $0 | | | | | | | | | Total | | | | $ | 1,260,536 | | | $0 | | | | | | D.E. Buckminster | | Retirement Plan | | 37 | | $ | 392,835 | | | $0 | | | | | | | | RRP-Retirement Plan | | | | $ | 510,246 | | | $0 | | | | | | | | | Total | | | | $ | 903,081 | | | $0 | | | | | | A.D. Williams | | Retirement Plan | | 33 | | $ | 267,832 | | | $0 | | | | | | | | RRP-Retirement Plan | | | | $ | 201,505 | | | $0 | | | | | | | | | Total | | | | $ | 469,337 | | | $0 |
| (1) | PVAB was determined using the same measurement date (December 31, 2017)2023) and assumptions as used for financial reporting purposes: |
● | ¾ | | Discount rate equal to 3.45 percent5.10% |
● | ¾ | | RP-2017Pri-2012 Mortality Table projected with MP-2017MP-2021 longevity improvements
|
● | ¾ | | Retirement age is assumed to be the normal retirement age as defined in the plan (age 65) |
● | ¾ | | Form of payment is the value of the cash balance account payable as a lump-sum distribution upon retirement | ● | PVAB includes the value of the MetLife benefit described below, if applicable
|
Retirement Plan.The NEOs (except for Mr. CampbellPlan: Messrs. Squeri, Buckminster and Ms. Seeger)Williams participate in the Retirement Plan, which is a defined benefit cash balance retirement plan. As a result of amendments made toplan for eligible U.S. colleagues. Benefit accruals were discontinued in the Retirement Plan insince 2007, benefit accruals were discontinued, althoughand the Retirement Plan continues to credit participants with interest on their outstanding account balances. The Retirement Plan sets the interest rate each year based on the average of the interest rates for certain five-year U.S. Treasury Notes, with a minimum interest rate of 5 percent.5%. The maximum interest rate is the lower of 10 percent10% or the applicable interest rate specified in the Retirement Plan. For 2017 and 2018,2023, the interest rate is 5 percent. In addition, benefits from the prior retirement plan, which was terminated in 1985, are payable through an insurance contract with MetLife Company and are included in the table above.5%. RRP-Retirement Plan.Plan: Each RRP participant who participated in the Retirement Plan has a Retirement Plan relatedPlan-related account for benefits that could not be provided under the Retirement Plan as a result of IRS limitations on tax-qualified plans. Compensation for RRP-Retirement Plan account purposes included the same components of compensation as for the Retirement Plan. RRP-Retirement Plan benefits accrueaccrued and vestvested in a similar manner to benefits under the Retirement Plan. Benefit accruals were discontinued in the RRP-Retirement Plan since 2007, and the Plan continues to credit participants with interest on their outstanding account balances at the same interest rate as the Retirement Plan. Participants may elect to receive payment of their RRP-Retirement Plan benefits in either a lump sum or annual installments over a period of five, ten or 15fifteen consecutive years. Lump sumLump-sum payments are made on or about the January 1 or July 1 that is at least six months following the participant’s separation from service and installment payments commence on or about the July 1 of the calendar year following the year in which the participant separates from service. As a result of amendments made to the Retirement Plan and RRP in 2007, benefit accruals were discontinued, however, like the Retirement Plan, the RRP-Retirement Plan continues to credit participants with interest on their outstanding account balances in accordance with the Retirement Plan provision as described above.
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2018 Proxy Statement Compensation Discussion and Analysis2024 PROXY STATEMENT 83 •
Nonqualified
Non-Qualified Deferred Compensation The following table shows the executive or Company contributions, earnings, withdrawals and account balances for the NEOs in the RRP-RSPRSP portion of the RRP (RRP-RSP) accounts and the deferred compensation programs.Deferral Plan. These programs are unfunded, unsecured deferred compensation programs. NonqualifiedNon-Qualified Deferred Compensation 20172023
| Name | | Plan Name | | Executive
Contributions
in Last FY
($) | | Company
Contributions
in Last FY
($)(1) | | Aggregate
Earnings in
Last FY
($)(2) | | Aggregate
Withdrawals/
Distributions
($) | | Aggregate
Balance at
Last FYE
($)(3) | | K.I. Chenault | | RRP-RSP | | | N/A | | $ | 320,731 | | $ | 157,845 | | $ | 0 | | $ | 6,738,967 | | | Deferral Plan | | $ | 106,108 | | | N/A | | $ | 815,958 | | $ | 0 | | $ | 31,570,069 | | | Total | | $ | 106,108 | | $ | 320,731 | | $ | 973,803 | | $ | 0 | | $ | 38,309,036 | | S.J. Squeri | | RRP-RSP | | | N/A | | $ | 406,709 | | $ | 529,592 | | $ | 0 | | $ | 3,834,587 | | | Deferral Plan | | $ | 331,846 | | | N/A | | $ | 367,178 | | $ | 627,582 | | $ | 4,711,880 | | | Total | | $ | 331,846 | | $ | 406,709 | | $ | 896,770 | | $ | 627,582 | | $ | 8,546,467 | | J.C. Campbell | | RRP-RSP | | | N/A | | $ | 201,162 | | $ | 71,959 | | $ | 0 | | $ | 670,615 | | | Deferral Plan | | $ | 242,750 | | | N/A | | $ | 143,188 | | $ | 0 | | $ | 948,205 | | | Total | | $ | 242,750 | | $ | 201,162 | | $ | 215,147 | | $ | 0 | | $ | 1,618,820 | | D.E. Buckminster | | RRP-RSP | | | N/A | | $ | 185,858 | | $ | 38,785 | | $ | 0 | | $ | 1,368,816 | | | Deferral Plan | | $ | 153,375 | | | N/A | | $ | 815,766 | | $ | 0 | | $ | 8,496,175 | | | Total | | $ | 153,375 | | $ | 185,858 | | $ | 854,551 | | $ | 0 | | $ | 9,864,991 | | L.E. Seeger | | RRP-RSP | | | N/A | | $ | 154,719 | | $ | 36,525 | | $ | 0 | | $ | 387,789 | | | Deferral Plan | | $ | 139,500 | | | N/A | | $ | 52,816 | | $ | 0 | | $ | 373,659 | | | Total | | $ | 139,500 | | $ | 154,719 | | $ | 89,341 | | $ | 0 | | $ | 761,448 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Name | | Plan Name | | Executive
Contributions
in Last FY | | | Company
Contributions
in Last FY(1) | | | Aggregate
Earnings in
Last FY(2) | | | Aggregate
Withdrawals/
Distributions | | | Aggregate
Balance at
Last FYE(3) | | | | | | | | | S.J. Squeri | | RRP-RSP | | | N/A | | | $ | 229,500 | | | $ | 1,302,814 | | | $ | 0 | | | $ | 7,994,380 | | | | | | | | | | | Deferral Plan | | $ | 1,497,035 | | | | N/A | | | $ | 1,317,805 | | | $ | 157,476 | | | $ | 10,948,884 | | | | | | | | | | | | Total | | $ | 1,497,035 | | | $ | 229,500 | | | $ | 2,620,619 | | | $ | 157,476 | | | $ | 18,943,264 | | | | | | | | | C.Y. Le Caillec | | RRP-RSP | | | N/A | | | $ | 87,130 | | | $ | 21,425 | | | $ | 0 | | | $ | 236,304 | | | | | | | | | | | Deferral Plan | | $ | 136,765 | | | | N/A | | | $ | 29,557 | | | $ | 0 | | | $ | 297,496 | | | | | | | | | | | | Total | | $ | 136,765 | | | $ | 87,130 | | | $ | 50,982 | | | $ | 0 | | | $ | 533,800 | | | | | | | | | D. E. Buckminster | | RRP-RSP | | | N/A | | | $ | 149,600 | | | $ | 102,638 | | | $ | 0 | | | $ | 2,418,086 | | | | | | | | | | | Deferral Plan | | $ | 1,100,000 | | | | N/A | | | $ | 1,566,698 | | | $ | 304,024 | | | $ | 13,639,489 | | | | | | | | | | | | Total | | $ | 1,100,000 | | | $ | 149,600 | | | $ | 1,669,336 | | | $ | 304,024 | | | $ | 16,057,575 | | | | | | | | | J.C. Campbell | | RRP-RSP | | | N/A | | | $ | 133,600 | | | $ | 206,066 | | | $ | 0 | | | $ | 1,914,877 | | | | | | | | | | | Deferral Plan | | $ | 200,000 | | | | N/A | | | $ | 324,278 | | | $ | 0 | | | $ | 2,947,406 | | | | | | | | | | | | Total | | $ | 200,000 | | | $ | 133,600 | | | $ | 530,344 | | | $ | 0 | | | $ | 4,862,283 | | | | | | | | | A.D. Williams | | RRP-RSP | | | N/A | | | $ | 133,600 | | | $ | 363,509 | | | $ | 0 | | | $ | 2,792,363 | | | | | | | | | | | Deferral Plan | | $ | 110,000 | | | | N/A | | | $ | 471,811 | | | $ | 0 | | | $ | 2,452,536 | | | | | | | | | | | | Total | | $ | 110,000 | | | $ | 133,600 | | | $ | 835,320 | | | $ | 0 | | | $ | 5,244,899 | | | | | | | | | L.E. Seeger | | RRP-RSP | | | N/A | | | $ | 113,600 | | | $ | 140,770 | | | $ | 0 | | | $ | 1,328,468 | | | | | | | | | | | Deferral Plan | | $ | 87,500 | | | | N/A | | | $ | 365,727 | | | $ | 0 | | | $ | 1,901,511 | | | | | | | | | | | | Total | | $ | 87,500 | | | $ | 113,600 | | | $ | 506,497 | | | $ | 0 | | | $ | 3,229,979 | |
| (1) | The amounts in this column are also included in the Summary Compensation Table onpage 75 under “All Other Compensation.”Compensation” table on page 75. |
| (2) | Earnings on RRP-RSP and Deferral Plan balances are determined based on hypothetical investment of those account balances at the direction of the participant in the investment options available under the RSP (other than the Self-Directed Brokerage Accountself-directed brokerage account and the Company Stock Fund). In addition to the investment options in the RSP, a Market Interest Rate option is available for pre-2011 Deferral Plan balances only. The Market Interest Rate option earns a rate of return based on the SEC defined market rate for deferred compensation for the year, which is 120 percent120% of the long-term Applicable Federal Rate for December of the preceding year. There are no above-market earnings for the deferral plan;Deferral Plan; therefore, no earnings are reported in the Summary Compensation Table. |
| (3) | Of the total amounts shown in this column, the following amounts have been reported as “Salary,” “Bonus” or “Non-Equity Incentive Plan Compensation” in the Summary“Summary Compensation TableTable” in this proxy statementProxy Statement and prior years’ proxy statements: for Mr. Chenault, $10,301,706; for Mr.Messrs. Squeri, $8,303,35; Le Caillec, $136,765; Buckminster, $4,414,890; Campbell, $793,577; for Mr. Squeri, $2,848,596; for Mr. Buckminster, $1,334,990$2,181,177; and Williams, $1,033,638 and for Ms. Seeger $298,000.$888,540. The amounts in the preceding sentence do not include: 1) amounts deferred by each executive before becoming an NEO and in subsequent years in which the executive was not an NEO; and 2) amounts reported in prior years’ proxy statements as above-market earnings on deferred compensation. |
RSP.Effective January 2010, allRSP: All U.S. active participants, including the NEOs, wereare immediately 100 percent100% vested in the Company matching contribution, which is generally up to 5 percent6% of total pay (base pay and eligible incentive pay capped at one times base pay). The RSP was amended effective January 1, 2017Prior to increase2021, the Company matching contribution from 5 percent to 6 percent of total pay.
The Company may also contributemade an annual discretionary profit sharing amountcontribution for eligible employeesU.S. colleagues based on the Company’s performance for the year. Effective January 1, 2021, the Company started making an annual performance. As a result of the Company’s 2017 performance, the Board approved a profit sharingfixed rate contribution of 5.5 percentfor eligible U.S. colleagues. The fixed rate contribution is 2% of total pay for eligible employeesU.S. manager-level colleagues and above (including NEOs), which includes an annual profit sharing contribution of 3 percent plus a 2.5 percent one-time contribution to employee profit sharing programs globally.. Company fixed rate contributions and discretionary profit sharing contributions generally vest on the third anniversary of an employee’sa colleague’s service with the Company.
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Compensation Discussion and Analysis2018 Proxy Statement• 84 2024 PROXY STATEMENT
For Company employeescolleagues who commenced their employment prior to April 1, 2007, an additional conversion contribution of up to 8 percent8% of total pay iswas generally also contributed. The percentage varies by individualwas based on theiran individual’s projected age and service as of December 31, 2008. The conversionConversion contributions for the NEOs are as follows: Mr. Chenault, 6.0 percent; and Messrs. Squeri and Buckminster, 3.75 percent. Mr. Campbell and Ms. Seeger commenced employment after April 1, 2007 and are not eligible for conversion contributions. As a result of the amendments to the RSP effective January 1, 2017, conversion contributions will be phased out, with contributions stoppingstopped at the end of 2017 for certain executives including the NEOs and stoppingstopped at the end of 2018 for all other employees.colleagues. RRP-RSP.RRP-RSP:Each RRP participant has aan RRP-RSP account for benefits that cannot be provided under the RSP as a result of IRS limitations on U.S. tax-qualified plans. The RRP was amended effective January 1, 2011, such that the Company matches employeecolleague contributions in the RRP-RSP account up to a maximum of 5 percent6% of total pay in excess of IRS compensation limits, only to the extent the employeecolleague voluntarily defers compensation under the Company’s nonqualifiedNon-Qualified Deferral Plan. All other CompanyConversion contributions toin the RRP-RSP were not impacted by this amendment.stopped as described above for the RSP. Compensation for RRP-RSP account purposes includes the same components of compensation as for the RSP, as well as the value of base pay and annual cash incentive amounts deferred by a participant under the nonqualifiedNon-Qualified Deferral Plan. The RRP was amended effective January 1, 2017 to be consistent with the changes taking effect in the RSP for the company matching contribution and conversion contributions. Participants may elect to receive payment of their RRP-RSP benefits in either a lump sum or annual installments over a period of five, ten or 15fifteen consecutive years.
Participants are allowed to make a one-time change to the form of payment for their RRP-RSP benefits so long as the change is made at least one year before the participant’s separation from service and the payment commencement date is delayed by at least five years. The payment election and any one-time change to the payment election apply to both the RRP-Retirement Plan and RRP-RSP balances. New participants will have a default lump sumlump-sum election for contributions attributable tothrough the first year.full year of participation, which is not subject to any one-time change. Deferral Plan.Plan:As part of planning for retirement or other long-term financial needs, the Company provides the U.S. NEOs and certain other senior-level employeessenior level U.S. paid colleagues with an annual opportunity to defer receipt of a portion of their base salary or cash annual cash incentive award up to one times their base salary. Under the Deferral Plan, certain participants may elect for payment to commence upon separation from service or a specified date at least five years after deferral, but not later than separation from service, and to receive payment in either a lump sum or annual installments over a period of five, ten or 15fifteen consecutive years. For 2007 and prior years, participants were able to defer receipt until termination of employment or a specified date at least five years after deferral, but not later than ten years after termination of employment. Deferral Plan Earnings.Starting January 1, 2011, earningsEarnings: Earnings for NEOs on deferralDeferral Plan balances are based on investment options similar to those offered under the RSP (other than the self-directed brokerage account and the Company Stock Fund and the Self Directed Brokerage Account)Fund). Furthermore, for participants, including NEOs, with pre-2011 balances, the Deferral Plan was amended to allowallows for an additional investment option that provides a market interest rate based on 120 percent120% of the long-term Applicable Federal Rate for December of the preceding year. Interest crediting on deferrals was previously based on ROE-linked interest crediting schedules.schedules up until December 31, 2010. |
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Potential Payments Upon Termination or CIC The tables below show certain potential payments that would have been made to an NEO if the NEO’s employment had terminated on December 31, 2017,2023, under various scenarios, including a CIC.change in control (CIC). The tables do not include the pension benefits or nonqualifiednor non-qualified deferred compensation that would be paid to an NEO, which are set forth in the Pension Benefits 20172023 and NonqualifiedNon-Qualified Deferred Compensation 20172023 tables above,on the previous pages, except to the extent that the NEO is entitled to an additional benefit as a result of the termination. In addition, the tables do not include the value of vested but unexercised SOs as of December 31, 2017.2023. The footnotes to the tables describe the assumptions used in estimating the amounts shown in the tables. Because the payments to be made to an NEO depend on several factors, the actual amounts to be paid out upon an NEO’s termination of employment can only be determined at the time of an executive’s actual separation from the Company. Additionally, to protect shareholders and our business model, executives are required to comply with non-compete, non-solicitation and certain other provisions during any period of time they receive severance.
| | | | | | | | | | | | | | | | | | | | | | | | | | S.J. Squeri | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Retirement | | Death | | Disability | | Termination w/o
Cause not in
Connection with
CIC | | Termination w/o Cause or Constructive Term. in Connection with CIC | | | | | | | Incremental Benefits Due to Termination Event(1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Severance(2) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 11,250,000 | | | | $ | 11,250,000 | | | | | | | | Value of LTIA(3) | | | $ | 62,157,860 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Deferred Compensation(4) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Retirement Savings Plan(5) | | | $ | 0 | | | | $ | 0 | | | | $ | 6,791 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Other Benefits(6) | | | $ | 740,307 | | | | $ | 0 | | | | $ | 0 | | | | $ | 133,199 | | | | $ | 133,199 | | | | | | | | Total Value of Incremental Benefits | | | $ | 62,898,167 | | | | $ | 0 | | | | $ | 6,791 | | | | $ | 11,383,199 | | | | $ | 11,383,199 | | | | | | | | C.Y. Le Caillec | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Retirement | | Death | | Disability | | Termination w/o
Cause not in
Connection with
CIC | | Termination w/o Cause or Constructive Term. in Connection with CIC | | | | | | | Incremental Benefits Due to Termination Event(1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Severance(2) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 4,650,000 | | | | $ | 4,650,000 | | | | | | | | Value of LTIA(3) | | | $ | 2,784,060 | | | | $ | 2,697,696 | | | | $ | 2,697,696 | | | | $ | 2,697,696 | | | | $ | 2,697,696 | | | | | | | | Deferred Compensation(4) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Retirement Savings Plan(5) | | | $ | 0 | | | | $ | 0 | | | | $ | 178,854 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Other Benefits(6) | | | $ | 37,502 | | | | $ | 0 | | | | $ | 0 | | | | $ | 129,124 | | | | $ | 129,124 | | | | | | | | Total Value of Incremental Benefits | | | $ | 2,821,561 | | | | $ | 2,697,696 | | | | $ | 2,876,550 | | | | $ | 7,476,820 | | | | $ | 7,476,820 | |
• 86 2024 PROXY STATEMENT | | | | | | | | | | | | | | | | | | | | | | | | | | D.E. Buckminster | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Retirement | | Death | | Disability | | Termination w/o Cause not in
Connection with
CIC | | Termination w/o
Cause or
Constructive Term. in Connection with CIC | | | | | | | Incremental Benefits Due to Termination Event(1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Severance(2) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 7,650,000 | | | | $ | 7,650,000 | | | | | | | | Value of LTIA(3) | | | $ | 23,108,523 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Deferred Compensation(4) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 29,475 | | | | $ | 29,475 | | | | | | | | Retirement Savings Plan(5) | | | $ | 0 | | | | $ | 0 | | | | $ | 45,136 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Other Benefits(6) | | | $ | 633,509 | | | | $ | 0 | | | | $ | 0 | | | | $ | 131,376 | | | | $ | 131,376 | | | | | | | | Total Value of Incremental Benefits | | | $ | 23,742,032 | | | | $ | 0 | | | | $ | 45,136 | | | | $ | 7,810,851 | | | | $ | 7,810,851 | | | | | | | | J.C. Campbell | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Retirement | | Death | | Disability | | Termination w/o
Cause not in
Connection with
CIC | | Termination w/o Cause or Constructive Term. in Connection with CIC | | | | | | | Incremental Benefits Due to Termination Event(1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Severance(2) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 7,050,000 | | | | $ | 7,050,000 | | | | | | | | Value of LTIA(3) | | | $ | 21,045,784 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Deferred Compensation(4) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Retirement Savings Plan(5) | | | $ | 0 | | | | $ | 0 | | | | $ | 42,951 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Other Benefits(6) | | | $ | 96,158 | | | | $ | 0 | | | | $ | 0 | | | | $ | 127,996 | | | | $ | 127,996 | | | | | | | | Total Value of Incremental Benefits | | | $ | 21,141,942 | | | | $ | 0 | | | | $ | 42,951 | | | | $ | 7,177,996 | | | | $ | 7,177,996 | | | | | | | | A.D. Williams | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Retirement | | Death | | Disability | | Termination w/o Cause not in
Connection with
CIC | | Termination w/o Cause or Constructive Term. in Connection with CIC | | | | | | | Incremental Benefits Due to Termination Event(1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Severance(2) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 7,050,000 | | | | $ | 7,050,000 | | | | | | | | Value of LTIA(3) | | | $ | 14,859,082 | | | | $ | 5,528,435 | | | | $ | 5,528,435 | | | | $ | 5,528,435 | | | | $ | 5,528,435 | | | | | | | | Deferred Compensation(4) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Retirement Savings Plan(5) | | | $ | 0 | | | | $ | 0 | | | | $ | 178,854 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Other Benefits(6) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 136,284 | | | | $ | 136,284 | | | | | | | | Total Value of Incremental Benefits | | | $ | 14,859,082 | | | | $ | 5,528,435 | | | | $ | 5,707,289 | | | | $ | 12,714,718 | | | | $ | 12,714,718 | |
2024 PROXY STATEMENT 87 • L.E. Seeger | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Retirement | | Death | | Disability | | Termination w/o
Cause not in Connection with
CIC | | Termination w/o Cause or Constructive Term. in Connection with CIC | | | | | | | Incremental Benefits Due to Termination Event(1) | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Severance(2) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 5,700,000 | | | | $ | 5,700,000 | | | | | | | | Value of LTIA(3) | | | $ | 16,429,266 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Deferred Compensation(4) | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Retirement Savings Plan(5) | | | $ | 0 | | | | $ | 0 | | | | $ | 76,234 | | | | $ | 0 | | | | $ | 0 | | | | | | | | Other Benefits(6) | | | $ | 20,193 | | | | $ | 0 | | | | $ | 0 | | | | $ | 136,081 | | | | $ | 136,081 | | | | | | | | Total Value of Incremental Benefits | | | $ | 16,449,459 | | | | $ | 0 | | | | $ | 76,234 | | | | $ | 5,836,081 | | | | $ | 5,836,081 | |
Potential Payments Upon Termination of Employment/CIC as of December 31, 2017(1)2023 K. I. ChenaultThe following table summarizes treatment of AIA and unvested LTIA awards based on the termination scenarios listed below:
| | Death(a) | | Disability(a) | | Retirement(b) | | Termination w/o
Cause not
in Connection
with CIC(c) | | Termination w/o Cause
or Constructive Term.
in Connection
with CIC(d) | Incremental Benefits Due to
Termination Event | | | | | | | | | | | | | | | | | Severance | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 4,000,000 | | $ | 4,000,000 | | Value of Accelerated LTIA(2) | | $ | 0 | | $ | 0 | | $ | 66,718,577 | | $ | 0 | | $ | 0 | | Deferred Compensation | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 967,408 | | $ | 967,408 | | RSP | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | Retirement Plan | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | Other Benefits | | $ | 0 | | $ | 0 | | $ | 880,239 | | $ | 300,255 | | $ | 135,789 | TOTAL VALUE OF
INCREMENTAL BENEFITS | | $ | 0 | | $ | 0 | | $ | 67,598,816 | | $ | 5,267,663 | | $ | 5,103,197 |
S. J. Squeri
| | Death(a) | | Disability(a) | | Retirement(b) | | Termination w/o
Cause not
in Connection
with CIC(c) | | Termination w/o Cause
or Constructive Term.
in Connection
with CIC(d) | Incremental Benefits Due to
Termination Event | | | | | | | | | | | | | | | | | Severance | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 12,900,000 | | $ | 12,900,000 | | Value of Accelerated LTIA(2) | | $ | 14,171,983 | | $ | 14,171,983 | | $ | 14,508,065 | | $ | 12,289,165 | | $ | 12,967,483 | | Deferred Compensation | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | RSP | | $ | 0 | | $ | 151,047 | | $ | 0 | | $ | 0 | | $ | 0 | | Retirement Plan | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | Other Benefits | | $ | 0 | | $ | 0 | | $ | 331,039 | | $ | 278,295 | | $ | 133,015 | TOTAL VALUE OF
INCREMENTAL BENEFITS | | $ | 14,171,983 | | $ | 14,323,030 | | $ | 14,839,104 | | $ | 25,467,460 | | $ | 26,000,498 |
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Compensation Discussion and Analysis2018 Proxy Statement
J. C. Campbell
| | Death(a) | | Disability(a) | | Voluntary
Resignation(b) | | Termination w/o
Cause not
in Connection
with CIC(c) | | Termination w/o Cause
or Constructive Term.
in Connection
with CIC(d) | Incremental Benefits Due to
Termination Event | | | | | | | | | | | | | | | | | Severance | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 9,850,000 | | $ | 9,850,000 | | Value of Accelerated LTIA(2) | | $ | 14,412,641 | | $ | 14,412,641 | | $ | 0 | | $ | 11,243,886 | | $ | 12,299,141 | | Deferred Compensation | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | RSP | | $ | 0 | | $ | 184,828 | | $ | 0 | | $ | 0 | | $ | 0 | | Retirement Plan | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | Other Benefits | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 170,136 | | $ | 135,136 | TOTAL VALUE OF
INCREMENTAL BENEFITS | | $ | 14,412,641 | | $ | 14,597,469 | | $ | 0 | | $ | 21,264,022 | | $ | 22,284,277 |
D. E. Buckminster
| | Death(a) | | Disability(a) | | Retirement(b) | | Termination w/o
Cause not
in Connection
with CIC(c) | | Termination w/o Cause
or Constructive Term.
in Connection
with CIC(d) | Incremental Benefits Due to
Termination Event | | | | | | | | | | | | | | | | | Severance | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 5,900,000 | | $ | 5,900,000 | | Value of Accelerated LTIA(2) | | $ | 3,835,052 | | $ | 3,835,052 | | $ | 6,085,633 | | $ | 3,835,052 | | $ | 2,791,152 | | Deferred Compensation | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 20,544 | | $ | 20,544 | | RSP | | $ | 0 | | $ | 186,563 | | $ | 0 | | $ | 0 | | $ | 0 | | Retirement Plan | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | Other Benefits | | $ | 0 | | $ | 0 | | $ | 255,213 | | $ | 269,662 | | $ | 134,650 | TOTAL VALUE OF
INCREMENTAL BENEFITS | | $ | 3,835,052 | | $ | 4,021,615 | | $ | 6,340,846 | | $ | 10,025,258 | | $ | 8,846,346 |
L. E. Seeger
| | Death(a) | | Disability(a) | | Voluntary
Resignation(b) | | Termination w/o
Cause not
in Connection
with CIC(c) | | Termination w/o Cause
or Constructive Term.
in Connection
with CIC(d) | Incremental Benefits Due to
Termination Event | | | | | | | | | | | | | | | | | Severance | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 5,800,000 | | $ | 5,800,000 | | Value of Accelerated LTIA(2) | | $ | 11,002,151 | | $ | 11,002,151 | | $ | 0 | | $ | 8,467,099 | | $ | 9,452,251 | | Deferred Compensation | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | RSP | | $ | 0 | | $ | 217,422 | | $ | 0 | | $ | 0 | | $ | 0 | | Retirement Plan | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 0 | | Other Benefits | | $ | 0 | | $ | 0 | | $ | 0 | | $ | 169,747 | | $ | 134,747 | TOTAL VALUE OF
INCREMENTAL BENEFITS | | $ | 11,002,151 | | $ | 11,219,573 | | $ | 0 | | $ | 14,436,846 | | $ | 15,386,998 |
| 85 Treatment of Awards | | | Termination Scenario | | Performance Restricted Stock
Units (PRSUs) | | Stock Options (SO) | | AIA Bonus | | | | | Voluntary Resignation or
Retirement | | Voluntary Resignation/Not Retirement Eligible: All unvested PRSUs are forfeited Early Retirement Eligible: All unvested PRSUs outstanding for more than one year continue to vest, vesting remains subject to performance metrics Full Retirement Eligible: All unvested PRSUs continue to vest and vesting remains subject to performance metrics | | Voluntary Resignation/Not Retirement Eligible: All unvested SOs are forfeited Early Retirement Eligible: Unvested SOs outstanding for more than one year continue to vest Full Retirement Eligible: All unvested SOs continue to vest | | Voluntary Resignation/Not Retirement Eligible: AIA is forfeited Early/Full Retirement Eligible: A pro rata AIA for the year of termination of employment subject to performance metrics at the end of the performance period, subject to the Compensation and Benefits Committee’s discretion | | | | | Death or Disability | | All unvested PRSUs will vest at target | | All unvested SOs will vest | | A pro rata AIA for the year of termination of employment subject to performance metrics at the end of the performance period, subject to the Compensation and Benefits Committee’s discretion |
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2018 Proxy Statement Compensation Discussion and Analysis• 88 2024 PROXY STATEMENT
| | | | | | | | | Treatment of Awards | | | Termination Scenario | | Performance Restricted Stock
Units (PRSUs) | | Stock Options (SO) | | AIA Bonus | | | | | Termination w/o Cause not in Connection with CIC | | Not Retirement Eligible: All unvested PRSUs continue to vest until the earlier of the end of the severance period or commencement of fulltime outside employment, at which time unvested PRSUs are forfeited Early or Full Retirement Eligible: All unvested PRSUs continue to vest and vesting remains subject to performance metrics and applicable Retirement treatment as noted above | | Not Retirement Eligible: All unvested SOs continue to vest until the earlier of the end of the severance period or commencement of fulltime outside employment, at which time unvested SOs are forfeited Early or Full Retirement Eligible: All unvested SOs continue to vest and vesting remains subject to performance metrics and applicable Retirement treatment as noted above | | A pro rata AIA for the year of termination of employment subject to performance metrics at the end of the performance period, subject to the Compensation and Benefits Committee’s discretion | | | | | Termination w/o Cause or
Constructive Term. in
Connection with CIC | | All unvested PRSUs will vest, subject to performance attained as of the termination date | | All unvested SOs will vest | | An average of the prior two years of actual AIA is paid out following termination |
| (1) | An NEO in the U.S. is “retirement eligible” if he/she isthey are at least age 55 with ten10 or more actual or deemed years of service to the Company prior to termination of service.service (referred to as “early retirement”). With respect to unvested LTIA granted,awards under the ICP, except the 2022 Special Award, once an NEO reaches early retirement, eligible, all LTIA outstanding for more than one year will vest in full upon retirement up until the, subject to applicable performance. Once an NEO is at least age 62 with ten10 or more actual or deemed years of service to the Company at which time all(referred to as “full retirement”), outstanding LTIA, except the 2022 Special Award, will continue vest in full upon retirement, subject to applicable performance. Messrs. Squeri, Buckminster, and Campbell and Ms. Seeger are full retirement eligible. Messrs. Le Caillec and Williams are early retirement eligible. |
| For Messrs. Chenault, Squeriall NEOs, in the event of death, disability, termination without cause not in connection with a change in control (CIC) and Buckminster,termination without cause or constructive termination in connection with CIC, the scenarios shown that are noted with (a), (c) and (d) includetable includes the incremental benefit that they would receive under these scenarios over and above what they would otherwise receive upon retirement. |
| ForUpon Retirement, Messrs. Buckminster, Campbell, and Williams and Ms. Seeger are eligible to receive RSUs granted in lieu of AIA subject to positive cumulative net income.
|
| Messrs. Squeri and Williams and Ms. Seeger received the 2022 Special Award in October 2022. As of December 31, 2023, the performance and time conditions for the award to vest were not met and, therefore, in the event of Voluntary Resignation,resignation, retirement, death, disability, termination without cause not in connection with CIC, or termination without cause or constructive termination in connection with CIC, Messrs. Squeri and Williams and Ms. Seeger would forfeit all unvested PSOs under this award. |
| Mr. Campbell retired on March 1, 2024. As of a result of his retirement and the portionFebruary 29, 2024 closing stock price of the sign-on cash payment ($2,634,000) that has already been paid to her is required to be repaid to the Company.$219.42, Mr. Campbell received a total of $21,183,186 which consist of $21,052,411 in LTIA and $130,775 in other benefits. |
| (2) | Severance reflects one and a half years of base salary and target AIA. The sum of these two numbers is paid out in equal installments over one and a half years. This treatment is applicable to termination without cause not in connection with CIC and termination without cause or constructive termination in connection with CIC under the Senior Executive Severance Plan. |
| (3) | Value of Accelerated LTIA.LTIA: PRSU, RSU, and SO values are based on a share price of $99.31,$187.34, the closing price per share of our common stock as of December 31, 2017.2023. For PRSUs, the value reflects the target value. For SOs, the value reflects the “in the money” value of SOs that would vest upon termination of employment or termination following CIC. With respectMessrs. Squeri, Buckminster, and Campbell and Ms. Seeger are full retirement eligible and therefore eligible for continued vesting of outstanding LTIA upon retirement, subject to PGs,applicable performance, with the value reflects the PG’s target value adjusted by the applicable payout percentage. | (a) | Death and Disability.An NEO or his/her designated beneficiary or estate would receive:
| | (i) | Pro Rata Bonus: A pro rata AIA for the year of termination at the endexception of the performance period, subject to Compensation and Benefits Committee discretion.
| | (ii) | Value of Accelerated LTIA: Vesting of 100 percent of outstanding SOs, RSUs and PG awards. For Messrs. Squeri and Buckminster, awards granted on October 31, 2017 will be delivered subject to award terms.
| | (iii) | RSP and RRP-RSP: Immediate vesting of any unvested account balances related to Company contributions. Upon disability, future Company contributions in the RSP through age 65.
| (b) | Retirement/Voluntary Resignation.For non-retirement eligible NEOs, 100 percent of AIA bonus and 100 percent of unvested LTIA will be forfeited. Since Mr. Chenault, Mr. Squeri and Mr. Buckminster are retirement eligible, they would receive:
| | (i) | Pro Rata Bonus: A pro rata AIA for the year of termination, subject to CBC discretion.
| | (ii) | Value of Accelerated LTIA:2022 Special Award.
|
● | SOs: For Mr. Chenault, all unvested SOs outstanding continue to vest; for Mr. Squeri and Mr. Buckminster, all unvested SOs outstanding for more than one year continue to vest, subject to performance at the end of the performance period. For Messrs. Squeri and Buckminster options granted on October 31, 2017 are forfeited.
| ● | PG: For Mr. Chenault, 100 percent of the grants continue to vest in full and for Mr. Squeri and Mr. Buckminster, 100 percent of the grants continue to vest in full if outstanding more than one year, subject to performance at the end of the performance period.
| ● | RSUs: For Mr. Chenault, all unvested RSUs will continue to vest, subject to performance. The amount for Mr. Chenault also includes the full value of 2017 AIA and PG awards (PG 2015-17) that were granted in the form of 125,841 RSUs in January 2018, but does not include the value of 2016 AIA and PG awards (PG 2014-16) that were granted in the form of 39,713 RSUs in January 2017, as these were included in the table last year and vested fully in January 2018. For Mr. Squeri and Mr. Buckminster, all unvested RSUs outstanding for more than one year continue to vest, subject to performance.
|
| (iii) | Other Benefits: For retirement eligible NEOs, the cash surrender value and projected lump-sum payment related to the life insurance under our Key Executive Life Insurance Plan. For Mr. Chenault, who retired from the Company in 2018 the expected payment under this plan in 2018 will be approximately $340,000 for the cash surrender value and approximately $540,000 for the projected lump-sum payment. For Messrs. Squeri and Buckminster, approximately $28,000 and $21,000 is for the cash surrender value and approximately $303,000 and $234,000 is the projected lump-sum payment.
| (c) | Termination Without Cause Not in Connection with a Change in Control.In the event of termination without cause not in connection with a CIC, an NEO would receive:
| | (i) | Severance: Two years’ annual compensation, which includes two times the most recent base salary and two times the amount of the last AIA paid.
| | (ii) | Pro Rata Bonus: A pro rata portion of the AIA for the year of termination is paid out at the end of the performance period, subject to CBC negative discretion.
|
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Compensation Discussion and Analysis 2018 Proxy Statement
(iii)(4) | Value of Accelerated LTIA:
|
● | For non-retirement eligible employees: All LTIA continue to vestDeferred Compensation: Reflects one and are canceled upon the earlier of the end of the severance period or commencement of full-time outside employment. SOs remain exercisable during the severance period and are canceled on the earlier of their expiration date, the end of the severance period or the commencement of full-time outside employment.
| ● | Retirement eligible employees: LTIA will vest as described in footnote (1) above. As a result, all PG, SO and RSU awards for Mr. Chenault will vest in full and Messrs. Squeri and Buckminster will vest partially in unvested LTIAs. For Messrs. Squeri and Buckminster awards granted on October 31, 2017 are forfeited if outstanding less than 18 months and pro-rata vesting subject to award terms.
|
(iv) | Deferred Compensation: Reflects twohalf years of additional interest crediting (using the prior year’s interest rate assuming 3.16 percent6.05% for 1994–2004 programs) on the grandfathered amounts (amounts that were earned and vested on or prior to December 31, 2004).
|
● | Non-retirement eligible: Account balance is paid in a lump sum. Grandfathered2004. Such amounts are paid out at the end of the two-yearone and a half years severance period and all other amounts are paid on a date at least six months following the date of termination.
| ● | Retirement eligible: Amounts are paid at the time and in the form (lump sum or installments) elected by the NEO; otherwise, the NEO’s account balance is paid in a lump sum. Grandfathered amounts are paid at the end of the two-year severance period, and all other amounts are paid on a date at least six months following the date of termination.NEO.
|
(v)(5) | Retirement Savings Plan: Upon disability, reflects future Company contributions in the RSP through age 65. |
| (6) | Other Benefits: TwoFor all NEOs, includes the payment of unused accrued vacation for the calendar year. Under our Key Executive Life Insurance Plan, for Messrs. Squeri and Buckminster, approximately $5,304 and $4,371, respectively, is for the cash surrender value and approximately $699,921 and $591,199, respectively, is the projected lump-sum payment related to life insurance. For all NEOs, under termination without cause not in connection with CIC and under termination without cause or constructive termination in connection with CIC, reflects one and a half years of contributions to U.S. medical, dental, health savings accounts and premiums, if applicable, under the basic and post-2003 Key Executive Life Insurance Plans; perquisite allowance for the year of terminationPlans, and outplacement services. |
(d) |
Termination Without Cause or Constructive Termination in Connection with a CIC.In the event of termination without cause or constructive termination in connection with a CIC, an NEO would receive:
| | (i) | Severance: Two years’ annual compensation, which includes two times the most recent base salary and two times the amount of the last AIA paid.
| | (ii) | Pro Rata Bonus: A pro rata portion of the AIA for the year of termination is paid out at the end of the performance period, subject to Compensation and Benefits Committee negative discretion.
| | (iii) | Value of Accelerated LTIA: For all awards granted upon employment termination (“double trigger”), 100 percent vesting of SOs and RSUs upon CIC and a pro rata portion of outstanding PG awards based on the average of the payout percentages for the last two PG programs paid out before the CIC. For Messrs. Squeri and Buckminster awards granted on October 31, 2017 will vest in full subject to performance condition being met.
| | (iv) | Deferred Compensation: Reflects two years of additional interest crediting (using the prior year’s interest rate assuming 3.16 percent for 1994-2004 programs) on the grandfathered amounts (amounts that were earned and vested prior to December 31, 2004). Grandfathered amounts are paid in a lump sum on a date that is at least six months following the date of termination. If the NEO is retirement eligible, all other account balances are paid at the time and in the form (lump sum or installments) elected by the NEO. If the NEO is not retirement eligible, all other account balances are paid in a lump sum on a date that is at least six months following the date of termination.
| | (v) | Other Benefits: Two years of contribution to U.S. medical, dental and health savings accounts, premiums toward basic life insurance, outplacement services and, if applicable, the cash surrender value of the life insurance under our Key Executive Life Insurance Plan.
|
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|
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2018 Proxy Statement Compensation Discussion and Analysis2024 PROXY STATEMENT 89 •
Equity Compensation Plans The following table provides summary information with respect to the Company’s equity compensation plans under which the Company’s common shares may be issued to employees or non-employees (such as consultants or advisors) as of December 31, 2017, each of which was approved by shareholders.2023. Information relating to employee stock purchase plans and employee savings plans (such as 401(k) plans) is not included. Information is provided in the aggregate for the Company’s equity compensation plans, each of which have beenwas approved by the Company’s shareholders. There are no such plans that have not been approved by shareholders. Equity Compensation Plan Information | Plan Category | | (A)
Number of Securities to
be Issued Upon Exercise
of Outstanding Options,
Warrants and Rights | | (B)
Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights | | (C)
Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation
Plans (Excluding
Securities Reflected in
Column (A)) | Equity compensation plans
approved by shareholders | | 7,261,586 | | $ | 58.92 | | 14,080,981 | Equity compensation plans not
approved by shareholders | | 0 | | | 0 | | 0 | | TOTAL | | 7,261,586 | | $ | 58.92 | | 14,080,981 |
| | | | | | | | | | | | | | | | | | | | Plan Category | | (A) Number of Securities to
be Issued Upon Exercise
of Outstanding Options,
Warrants and Rights | | (B)
Weighted-Average
Exercise Price of
Outstanding
Options,
Warrants and Rights | | (C)
Number of Securities
Remaining Available
for Future Issuance Under
Equity Compensation
Plans (Excluding
Securities Reflected in
Column (A)) | | | | | Equity compensation plans approved by shareholders | | | | 3,553,439 | | | | $ | 119.80 | | | | | 6,849,506 | | | | | | Equity compensation plans not approved by shareholders | | | | — | | | | | — | | | | | — | | | | | | Total | | | | 3,553,439 | | | | $ | 119.80 | | | | | 6,849,506 | |
Pay Ratio CEO Pay Ratio Our CEO to median compensated employee pay ratio is 677:1, with the 2023 Summary Compensation Table annual total compensation amount for Mr. Squeri being $35,676,905 and the equivalent annual total compensation for the identified median compensated employee being $52,680. To calculate the annual total compensation for the identified median employee, we used the same methodology as set forth in the “2023 Summary Compensation Table” in this Proxy Statement and did not make any assumptions, adjustments or estimates with respect to their total compensation. In determining our pay ratio for our 2023 fiscal year, we concluded there were no significant changes to our employee population or employee compensation arrangements since 2022 that we believe would significantly impact our pay ratio disclosure. However, there was a significant decrease in the number of hours worked and the resulting overall compensation of the original median employee in 2023 as compared to 2022, which would result in a significant change in our pay ratio disclosure. Since it was no longer appropriate to use the original median employee, we determined a new median employee whose compensation was substantially similar to the compensation of the original median employee, based on the methodology used to select the original median employee as disclosed in the Proxy Statement for our 2023 Annual Meeting of Shareholders.
The information contained in this section shall not be deemed incorporated by reference in any filing under the Securities Act of 1933or the Securities Exchange Act of 1934. Pay versus Performance Table The following table sets forth compensation information of our Principal Executive Officer (PEO) and our non-PEO NEOs along with total shareholder return, net income and ROE performance results for our fiscal years ending in 2023, 2022, 2021, and 2020 in accordance with Item 402(v) of Regulation S-K. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Value of Initial Fixed $100
Investment Based On: | | | | | | | | | | | | | | | | Summary Compensation Table Total for PEO | | Compensation Actually Paid to PEO | | Average Summary Compensation Table Total for Non-PEO NEOs | | Average Compensation Actually Paid to Non-PEO NEOs | | | | Peer Group Total Shareholder Return | | | | | | | | | | | | | | | 2023 | | | $ | 35,676,905 | | | | $ | 62,343,130 | | | | $ | 11,989,458 | | | | $ | 18,255,375 | | | | $ | 159 | | | | $ | 133 | | | | $ | 8,374 | | | | | 32 | % | | | | | | | | | | | 2022 | | | $ | 48,029,631 | | | | $ | 42,946,184 | | | | $ | 16,164,592 | | | | $ | 14,676,078 | | | | $ | 124 | | | | $ | 118 | | | | $ | 7,514 | | | | | 32 | % | | | | | | | | | | | 2021 | | | $ | 25,513,922 | | | | $ | 49,856,563 | | | | $ | 13,006,174 | | | | $ | 21,986,724 | | | | $ | 135 | | | | $ | 132 | | | | $ | 8,060 | | | | | 34 | % | | | | | | | | | | | 2020 | | | $ | 24,221,319 | | | | $ | 20,125,419 | | | | $ | 10,917,918 | | | | $ | 9,893,026 | | | | $ | 98 | | | | $ | 97 | | | | $ | 3,135 | | | | | 14 | % |
88(1) | 2018 Proxy StatementThe PEO reflected in columns (b) and (c) represents Mr. Squeri for all four years shown. The non-PEO Named Executive Officers (NEOs) reflected in columns (d) and (e) represent the following individuals for 2023: Messrs. Le Caillec, Buckminster, Campbell, Williams and Ms. Seeger; for 2022, represent: Messrs. Campbell, Williams, Buckminster and Radhakrishnan; and for 2021 and 2020: Messrs Campbell, Buckminster, Williams and Ms. Seeger. Mr. Le Caillec’s compensation was increased effective August 2023 as a result of his promotion to CFO. The 2023 non-PEO NEO compensation listed in columns (d) and (e) reflect Mr. Le Caillec’s base salary and prorated AIA for the time spent in each role. |
| (2) | Compensation Actually Paid (CAP) has been calculated based on the requirements and methodology set forth in the applicable SEC rules (Item 402(v) of Regulation S-K). |
| The CAP calculation includes thevalue of awards granted within the fiscal year, the change in fair value from prior year-end of vested awards and the change in the fair value of unvested awards granted in prior years, regardless of if, when or at which intrinsic value they will actually vest. To calculate CAP the following amounts were deducted from and added to the total compensation number shown in the Summary Compensation Table (SCT): |
PEO SCT Total to CAP Reconciliation: | | | | | | | | | | | | | | Summary Compensation Table (SCT) Total | | | | 35,676,905 | | | | | Deduction for change in the actuarial present values reported under “Change in Pension Value and Nonqualified Deferred Compensation Earnings” in the SCT | | | $ | (64,534 | ) | | | | Deduction for amounts reported under “Stock Awards” in the SCT | | | $ | (19,287,280 | ) | | | | Deduction for amounts reported under “Option Awards” in the SCT | | | $ | (4,449,964 | ) | | | | | | | (23,801,778 | | | | Increase for service cost and prior service cost for pension plans (i) | | | | — | | | | Increase/deduction for change in fair value from prior year-end to vesting date of awards that vested during the year (ii)(iii) | | | $ | 4,108,459 | | | | Increase/deduction for change in fair value from prior year-end to current year-end of awards granted in any prior year that were outstanding and unvested as of year-end (ii) | | | $ | 19,802,797 | | | | Increase for fair value of awards granted during year that remain unvested as of year-end (ii) | | | $ | 25,895,746 | | | | Increase based on accrued dividends during year prior to vesting dates of awards (ii) | | | $ | 661,001 | | | | | | | | 50,468,003 | | | | Compensation Actually Paid (SCT minus deductions plus total adjustments) | | | | 62,343,130 | |
Table of Contents Average Non-PEO NEO SCT Total to CAP Reconciliation | | | | | | | | | | | | | | Summary Compensation Table (SCT) Total | | | | | | | | | Deduction for change in the actuarial present values reported under “Change in Pension Value and Nonqualified Deferred Compensation Earnings” in the SCT | | | $ | (41,069 | ) | | | | Deduction for amounts reported under “Stock Awards” in the SCT | | | $ | (4,863,057 | ) | | | | Deduction for amounts reported under “Option Awards” in the SCT | | | $ | (947,970 | ) | | | | | | | (5,852,096 | | | | Increase for service cost and prior service cost for pension plans (i) | | | | — | | | | Increase/deduction for change in fair value from prior year-end to vesting date of awards that vested during the year (ii) (iii) | | | $ | 1,243,180 | | | | Increase/deduction for change in fair value from prior year-end to current year-end of awards granted in any prior year that were outstanding and unvested as of year-end (ii) | | | $ | 4,341,023 | | | | Increase for fair value of awards granted during year that remain unvested as of year-end (ii) | | | $ | 6,339,441 | | | | Increase based on accrued dividends during year prior to vesting dates of awards (ii) | | | $ | 194,369 | | | | | | | | 12,118,012 | | | | Compensation Actually Paid (SCT minus deductions plus total adjustments) | | | | 18,255,375 | |
| (i) | Benefit accruals were discontinued in the defined benefit (DB) pension plans in 2007; therefore, their service cost subsequent to this date is zero. The DB pension plans have not been amended during 2023 to change the value of the benefits provided under the plans; therefore, there is no prior service cost in this period. |
| (ii) | Fair value is determined in a manner consistent with that disclosed in our consolidated financial statements. Fair value or change in fair value, as applicable, of equity awards in the “Compensation Actually Paid” columns was determined by reference to: |
| | | For RSU awards (excluding performance based RSUs), closing price on applicableyear-end date(s) or, in the case of vesting dates, the actual vesting price. |
| | | For PRSUs awarded from 2019 onwards (which include a relative TSR performance condition in addition to a relative ROE performance condition as outlined on page 60), the fair value was estimated using a Monte Carlo simulation model multiplied by an estimate of the probable payout percentage as of the applicable year-end dates, or, in the case of vesting awards, the actual vesting price and outcome. |
| | | For stock options, a Black Scholes value as of the applicable year-end or vesting date, determined based on the same methodology as used to determine grant date fair value but using the closing stock price on the applicable revaluation date as the current market price and with an expected term set using an elapsed term approach. This approach estimates expected term by subtracting the amount of time that has elapsed (between the grant and subsequent valuation dates) from the initial grant-date expected term estimate divided by the percentage change between the option’s strike price and the stock price at the valuation date. Volatility (based on historical and implied volatilities), risk-free rates and dividend yield are determined as of the revaluation date based on the expected term. |
| | | For PSO awards (which include a relative Total TSR performance condition as outlined on page 60), the fair value was estimated using a Monte Carlo simulation model as of the applicable year-end dates. |
| (iii) | Vested awards have met the requisite service period as well as achieved the performance and market conditions, if applicable. |
| (3) | Reflects cumulative Total Shareholder Return (TSR). It shows the growth of a $100 investment on December 31, 2019, including the reinvestment of all dividends. |
| (4) | Peer TSR reflects the TSR of the S&P Financials Index, the industry index peer group reported in the Company’s Stock Performance Graph in the 2023 Annual Report on Form10-K. |
| (5) | ROE is calculated for the relevant periods by dividing the (i) net income for the period by (ii) average shareholders’ equity for the period. |
Tabular List of Performance Metrics The items listed below represent three financial metrics used to determine executive compensation for 2023. Further detail on all metrics included in our Company Scorecard are described in our Compensation Discussion and Analysis (CD&A) starting on page 58. | | | | | Return on Equity | | | Earnings Per Share | | | Revenue Growth |
Pay Versus Performance Description of Relationships We align pay with Company performance to support a long-term, high-performance business model. The year-over-year changes in CAP are primarily due to the result of our stock performance and varying levels of achievement againstpre-established performance goals under the AIA and LTIA programs as described in the CD&A on pages 58-60. TOTAL SHAREHOLDER RETURN: COMPANY VERSUS S&P FINANCIALS INDEX The Company’s four-year cumulative TSR is well above the companies included in the S&P Financials Index and the Company’s TSR has been above that of the S&P Financials Index in each year during that four-year period. Total Shareholder return in the above chart, in the case of both the Company and S&P Financials Index as noted in footnote 3 of the Pay versus Performance Table on page 90, reflects the cumulative return of $100 as if invested on December 31, 2019, including reinvestment of any dividends.
COMPENSATION ACTUALLY PAID VERSUS TSR AND NET INCOME Approximately 70% of CEO (PEO) total compensation and on average 50% of total compensation for non-PEO NEOs is composed of long-term incentive awards that are tied to the future performance of the Company, including stock price and positive cumulative net income. As a result, the changes in CAP year-over-year are in line with TSR and net income. COMPENSATION ACTUALLY PAID VERSUS ROE ROE is a key financial metric in both the Company’s AIA and LTIA programs because it aligns the interests of the executives with shareholders. In addition, sustaining a strong ROE is a key driver of long-term value creation.
Shareholder Proposals• 94 2024 PROXY STATEMENT
Item 4: Approval of the Second Amended and Restated American Express Company 2016 Incentive Compensation Plan On March 6, 2024, upon the recommendation of the Compensation and Benefits Committee, the Board approved a second amendment and restatement of the American Express Company 2016 Incentive Compensation Plan (2016 Plan), subject to shareholder approval. The 2016 Plan allows us to grant the equity and cash incentive compensation awards that are the key elements of our compensation philosophy and practices. The 2016 Plan as further amended and restated will become effective upon shareholder approval. | ITEM | | | 4 | Our Board of Directors recommends a vote FOR the Proposal |
Background The 2016 Plan was originally adopted by our Board, and approved by our shareholders at our 2016 Annual Meeting. The 2016 Plan was then amended and restated in March 2020, subject to shareholder approval at our 2020 Annual Meeting to increase the number of shares available under the 2016 Plan and to remove the provisions related to the qualified performance-based compensation exception under Section 162(m) of the Internal Revenue Code, which was repealed by the Tax Cuts and Jobs Act of 2017. The closing stock price of a common share reported on the NYSE on March 8, 2024, our record date, was $223.37 per share. Purpose and Importance of the 2016 Plan The 2016 Plan enables the Company to: | ¾ | | Attract, motivate and retain highly qualified and experienced employees at all levels of the Company as well as non-employee directors |
| ¾ | | Align employee and shareholder interests in the creation of shareholder value |
| ¾ | | Incentivize short and long-term financial and operational performance |
| ¾ | | Adapt to evolving best practices in compensation |
Material Changes to 2016 Plan | ¾ | | Authorize an additional 15,000,000 shares, bringing the total number of shares available for grant after the approval to approximately 19,700,000. The maximum number of shares that were available for issuance under the 2016 Plan upon its initial adoption was 17,500,000 shares and an additional 7,000,000 shares were added by the first amendment and restatement in 2020. |
| ¾ | | Extend the expiration date of the 2016 Plan to May 6, 2034. |
| | The amended 2016 Plan maintains all of the key governance features as under the original plan. |
2016 Plan Share Pool In recommending the authorization of an additional 15,000,000 shares, the Compensation and Benefits Committee and the Board took into consideration the number of shares (approximately 4,700,000(1)) currently available under the 2016 Plan. Equity awards are an important component of our compensation structure, and we have historically maintained a reasonable burn rate and dilution. | (1) | Assumes that unvested Performance RSUs vest at target. Actual number will be lower if Performance RSUs vest at above-target level and vice versa. |
2024 PROXY STATEMENT 95 • Extension of Expiration Date The 2016 Plan is currently set to expire on May 2, 2026. The amendment and restatement would extend the expiration date to May 6, 2034. Unless subsequently further extended by the shareholders, no new awards may be granted after such date. While we expect to need shareholder approval of another amendment and restatement or the adoption of a successor plan before that date, the extension affords flexibility as to when to do so. Highlights of the 2016 Plan The 2016 Plan reflects market and corporate governance best practices, based on a review conducted with the help of outside advisors, including the Compensation and Benefits Committee’s independent compensation consultant, Semler Brossy. Set forth below are key features of the 2016 Plan. A more detailed summary is included under “Summary of 2016 Plan” beginning on page 121. 2016 Plan Does | | | | |  | | Provide for a minimum one-year vesting period subject to certain limited carve outs | | | | | Include limits on the number of shares or cash amounts
that may be granted to any individual employee in a year | | | | | Include a limit on the value of equity-based awards that may be granted to any individual non-employee director
in a year | | | | | Provide for recycling of shares back to the plan pool only in the event of forfeiture or cancellation | | | | | Provide for forfeiture/clawback of incentive awards under certain circumstances | | | | | Provide for administration by an independent Board committee |
2016 Plan Does Not | | | | |  | | Permit single-trigger vesting on a change in control (except
in the sole circumstance where an acquirer does not assume outstanding awards) | | | | | Permit liberal share recycling | | | | | Permit direct or indirect repricing of underwater stock options without shareholder approval | | | | | Permit the grant of options with below-market exercise prices | | | | | Permit excise tax gross-ups | | | | | Include any “evergreen” provisions that automatically add shares to the plan without shareholder approval | | | | | Permit the grant of reload options | | | | | Permit loans for payment of exercise prices or taxes | | | | | Permit “net share counting” upon the exercise of options and stock appreciation rights | | | | | Permit the recycling of shares underlying awards that are settled in cash |
• 96 2024 PROXY STATEMENT Summary of 2016 Plan The full text of the 2016 Plan as amended and restated is attached to this Proxy Statement as Exhibit A. The principal terms of the 2016 Plan as amended and restated are described below, but the description is qualified in its entirety by reference to the 2016 Plan itself. The second amendment and restatement of the 2016 Plan will not become effective unless approved by our shareholders. | | | | | Shareholder Proposal Relating
Eligible Participants
| | ¾ All employees and other individuals performing services for the Company are eligible to Action by Written Consentreceive awards under the 2016
Plan. ¾ Generally, on an annual basis approximately 7,000 employees, including all executive officers, and all non-employee
directors may be considered for awards. |  | | Types of Awards | | The 2016 Plan allows for the granting of stock options (both non-qualified and incentive), stock appreciation rights, restricted stock, restricted stock units, performance grants, dividend equivalents and awards providing benefits similar to the foregoing awards. ¾ The Compensation and Benefits Committee has the authority to grant and set the terms of awards made to participants
other than non-employee directors, including if it chooses, the authority to adopt subplans for non-U.S. participants. ¾ The Board has the authority to grant and set the terms of awards made to non-employee directors and, with respect to
those awards, to exercise all authority of the Compensation and Benefits Committee described below. ¾ Awards under the 2016 Plan may be paid in cash, shares, or other property as determined by the Compensation and
Benefits Committee. | | | Available Shares | | The maximum number of shares that were available for issuance under the 2016 Plan upon its initial adoption was 17,500,000 shares, and an additional 7,000,000 shares were added by the first amendment and restatement in 2020. Approximately 4,700,000(1) shares remained available for grant as of March 8, 2024. The maximum number of available shares is being increased by an additional 15,000,000 shares. If the second amended and restated 2016 Plan is approved, the maximum number of shares that may be issued under the 2016 Plan after March 8, 2024 will be approximately 19,700,000. Awards will be counted against the 2016 Plan reserve on the date of grant, based on the maximum number of shares that may be issued pursuant to the award. Shares issued under the 2016 Plan may come from newly issued, treasury or reacquired shares, or any combination thereof. Shares underlying awards that are forfeited, cancelled, expired or otherwise terminated without the issuance of shares become available for re-issuance under the 2016 Plan. The following shares underlying awards do NOT become available for reissuance under the 2016 Plan: ¾ Shares used to satisfy tax withholding obligations or to cover payments in connection with the net settlement of
outstanding options or stock appreciation rights ¾ Shares repurchased on the open market with the proceeds from the payment of exercise price of stock options ¾ Shares underlying awards that are settled in cash | | | Annual Award Limits (Participants Other than Non-Employee Directors) | | ¾ No participant may be granted more than 2,000,000 shares subject to stock options and stock appreciation rights in any
one calendar year. ¾ No participant may receive more than 1,000,000 shares of restricted stock or shares underlying restricted stock units in
any one calendar year (excluding any restricted stock or restricted stock units issued in satisfaction of performance
grants that are made in lieu of awards that have been denominated in cash). ¾ No participant may be paid more than $20,000,000 in cash, shares or other property (including restricted stock or
restricted stock units) under performance grants in any one calendar year. |
| (1) | Assumes that unvested Performance RSUs vest at target. Actual number will be lower if Performance RSUs vest at above-target level and vice versa. |
2024 PROXY STATEMENT 97 • | | | | | Annual Award Limits
(Non-Employee Directors) | | ¾ No non-employee director may be granted equity-based awards in any one calendar year for services as a
non-employee director with an aggregate fair market value (determined on the award grant date) in excess of $500,000. | | | Minimum Vesting Periods | | ¾ All awards will have a minimum exercisability or vesting period of at least one year except for: ¾ Limited exceptions for death, disability, retirement, and certain corporate transactions (Defined Events) ¾ Up to a maximum of five percent (5%) of the maximum aggregate number of shares under the 2016 Plan may be
issued without regard for any minimum exercisability or vesting period requirements ¾ The Compensation and Benefits Committee may adjust the vesting period for awards assumed by the Company in
corporate transactions | | | Stock Options and Stock Appreciation Rights | | ¾ A stock option is the right to purchase a specified number of shares for a fixed exercise price not less than the fair
market value of the underlying shares on the date of grant and a stock appreciation right is the right to receive cash,
shares or other property based on the increase in the value of the number of shares underlying the award over such
fixed exercise price not less than the fair market value of the underlying shares on the date of grant. ¾ Limited exception for exercise price of awards assumed by the Company in corporate transactions ¾ Fair market value of a share on a given date is determined by the closing price as reported by the Company’s principal
stock exchange on such date. ¾ Participants must be employed by or performing services for the Company or one of its affiliates from the date of grant
through the date of exercise, in order to exercise an option or stock appreciation right, subject to limited exceptions. ¾ Term cannot be longer than 10 years. ¾ The maximum number of shares that may be issued pursuant to incentive stock options may not exceed, in the
aggregate, 8,000,000. | | | Restricted Stock and
Restricted Stock Units | | ¾ Restricted stock is an award of shares that is subject to a vesting period determined by the Compensation and Benefits
Committee during which they cannot be transferred. ¾ Prior to the expiration of the vesting period, a participant who has received an award of restricted stock has the right
to vote and to receive dividends on the underlying unvested shares ¾ Any dividends that are not paid currently may, at the Compensation and Benefits Committee’s discretion, accrue
interest or be reinvested into additional shares of restricted stock subject to the same vesting or performance
conditions as the underlying award ¾ Restricted stock units are awards that are valued by reference to shares which may be paid to a participant upon
vesting in cash, shares or other property. ¾ Prior to the expiration of the vesting period, a participant who has received an award of restricted stock units will have
no right to vote or to receive dividend equivalents unless otherwise determined by the Compensation and Benefits
Committee | | | Performance Grants | | ¾ Performance grants are amounts payable in cash, shares or other property as determined by the degree to which
performance objectives are achieved during a specified period, subject to adjustments approved by the Compensation
and Benefits Committee. ¾ Performance objectives may be based upon Company, business unit, participant and/or other performance objectives,
including but not limited to one or more of the following: ¾ Revenue, revenue growth or product revenue growth ¾ Net income (before or after taxes) ¾ Earnings (including earnings before taxes, earnings before interest and taxes or earnings before interest, taxes,
depreciation and amortization) or earnings per share |
• 98 2024 PROXY STATEMENT | | | | | | | ¾ Shareholders’ equity or return on shareholders’ equity ¾ Assets, return on assets or net assets ¾ Capital or return on capital (including return on total capital or return on invested capital) ¾ Book value or book value per share ¾ Economic value-added models or equivalent metrics ¾ Operating income (before or after taxes) ¾Pre- or after-tax income (before or after allocation of corporate overhead or incentive compensation) ¾ Operating expenses or reengineering savings ¾ Operating margins, gross margins or cash margin ¾ Cash flow, cash flow per share (before or after dividends) or cash flow return on investment ¾ Stock price or total shareholder return ¾ Market share ¾ Debt reduction ¾ Comprehensive Capital Analysis and Review (CCAR) related capital ratios ¾ Credit metrics ¾ Regulatory achievements ¾ The Compensation and Benefits Committee may provide that, in measuring the achievement of the performance
objectives, an award may include or exclude items such as realized investment gains and losses, extraordinary, unusual,
non-recurring or infrequently recurring items, asset write-downs, effects of accounting changes, currency fluctuations,
acquisitions, divestitures, reserve-strengthening and other non-operating items. | | | Transferability | | A participant’s rights in an award granted under the 2016 Plan may be assigned or transferred only in the event of death, or if permitted by the Compensation and Benefits Committee. | | | Change-in-Control | | The Compensation and Benefits Committee may provide in an award agreement provisions relating to a “change-in-control” of the Company (as such term is defined in the award agreement), including without limitation the acceleration of the exercisability, vesting or settlement of, or the lapse of restrictions or deemed satisfaction of performance objectives with respect to, an award; provided that, in addition to any other conditions provided for in the award agreement: 1. any acceleration of the exercisability, vesting or settlement of, or the lapse of restrictions or deemed satisfaction of performance objectives with respect to, an award in connection with a change in control may occur only if (i) the change in control occurs and (ii) either (A) the employment of the participant is terminated (“double-trigger”) or (B) the acquirer does not agree to the assumption or substitution of outstanding awards; 2. for any award that is earned or vested based upon achievement of performance objectives, any amount deemed earned or vested in connection with a change in control or associated termination of employment shall be based upon the degree of performance attainment and/or the period of time elapsed in the performance period as of the applicable date; and 3. for any award that constitutes nonqualified deferred compensation under Section 409A of the Code and provides for an accelerated payment in connection with a change in control (whether or not in conjunction with a termination of employment), “change in control” shall mean a change in control within the meaning of Section 409A for purposes of such accelerated payment provision. | | | Award Forfeiture Provisions | | Awards are subject to reduction, cancellation, repayment, forfeiture and recoupment in accordance with any clawback policy adopted by the Company, including the Company’s Incentive Compensation Recoupment Policy and its Policy for the Recovery of Erroneously Awarded Compensation, as well as any clawback requirements imposed under applicable law (including Section 10D of the Exchange Act, Rule 10D-1 thereunder and Section 303A.14 of the NYSE Listed Company Manual). See page 71 for more details. |
2024 PROXY STATEMENT 99 • | | | | | Dilution and Other Adjustments | | The 2016 Plan provides that in the event of any corporate transaction or change in corporate capitalization, the Compensation and Benefits Committee will make appropriate changes to the terms of the 2016 Plan (e.g., the maximum number or kind of shares that may be issued under the 2016 Plan and individual limits) and outstanding awards. | | | Tax Withholding | | The exercise or payment of awards and the issuance of shares under the 2016 Plan is conditioned upon a participant making satisfactory arrangements for the satisfaction of any liability to withhold federal, state, local or foreign income or other taxes. | | | Plan Amendment | | The 2016 Plan may be amended in whole or in part at any time and from time to time by the Board of Directors provided, however, that no amendment may be made without shareholder approval if such amendment would (a) increase the number of shares available for grant, (b) decrease the minimum stock option exercise price, (c) reduce the minimum vesting or performance periods under the Plan for awards, (d) change the aggregate or annual award limits, (e) amend or repeal the prohibitions against repricing or exchange of awards, or (f) adversely affect compliance with applicable laws, rules and regulations. | | | Termination | | Unless a further extension is subsequently approved by the shareholders, the 2016 Plan will terminate upon the earlier of (a) May 6, 2034, and (b) the Board taking action to terminate the 2016 Plan. |
Certain U.S. Federal Income Tax Consequences of Awards The following discussion is intended to provide only a general outline of the U.S. federal income tax consequences of participation in the 2016 Plan and the receipt of awards or payments thereunder by participants subject to U.S. taxes. It does not address any other taxes imposed by the U.S., taxes imposed by any state or political subdivision thereof or foreign jurisdiction, or the tax consequences applicable to participants who are not subject to U.S. taxes. Generally, subject to applicable provisions of the Code and regulations thereunder, including Section 162(m), the Company is entitled to a tax deduction at the time and in an amount equal to the ordinary income recognized by the participant. Nonqualified stock options. A participant who exercises a nonqualified stock option recognizes taxable ordinary income in the year the option is exercised in an amount equal to the excess of the fair market value of the shares purchased on the exercise date over the exercise price. Incentive stock options (ISO). A participant who exercises an ISO does not recognize ordinary income at the time of exercise (although the participant may be subject to the alternative minimum tax), and the Company is not entitled to a tax deduction. Upon the sale of shares obtained by exercising an ISO more than two years after grant and one year after exercise, the excess of the sale price of the shares over the exercise price of the ISO is taxed as long-term capital gain. If the shares are sold within two years of the grant date and/or one year of the date of exercise, the excess of the fair market value of the shares on the date of exercise (or sale proceeds if less) over the exercise price is taxed as ordinary income and any remaining gain is taxed as short-term capital gain. Stock appreciation rights. A participant who exercises a stock appreciation right recognizes taxable ordinary income in the year the stock appreciation right is exercised in an amount equal to the cash and/or the fair market value of any shares received. Restricted stock and restricted stock units. When shares of restricted stock vest or restricted stock units settle, the participant will recognize taxable ordinary income in an amount equal to the fair market value of the shares at that time less the amount, if any, paid for the shares. A participant may elect, by filing a timely election under Section 83(b) of the Code, to recognize taxable ordinary income in the year shares of restricted stock are granted in an amount equal to the excess of their fair market value at the grant date, determined without regard to certain restrictions, over the amount, if any, paid for the shares. The discussion set forth above does not purport to be a complete analysis of all potential tax consequences relevant to recipients of awards, particular circumstances, or all awards available under the 2016 Plan. It is based on U.S. federal income tax law and interpretational authorities as of the date of this Proxy Statement, which are subject to change at any time.
• 100 2024 PROXY STATEMENT New Plan Benefits The specific benefits or amounts to be received by or allocated to participants and the number of shares to be granted under the amended and restated 2016 Plan cannot be determined at this time because the amount and form of grants to be made to any eligible participant in any year is determined at the discretion of the Compensation and Benefits Committee or the Board, as applicable. Aggregate Awards Granted The following table sets forth information with respect to the number of shares subject to awards previously granted under the 2016 Plan since its inception through March 8, 2024, our record date, to each NEO, all current executive officers as a group, and all employees, including all current officers who are not executive officers, as a group. No non-employee director received awards under the 2016 Plan and there is no person who has received or as determined at this time, will receive 5% or more of the available shares under the 2016 Plan. This table includes shares subject to awards that may have been exercised, cancelled or forfeited: | | | | | | | | | | | | | | | Name | | Number of
Shares
Underlying
Options | | | Number of
Shares
Underlying
Time-Based
Restricted
Stocks Units | | Number of
Shares
Underlying
Performance-
Based
Restricted
Stocks
Units | | | | | | S.J. Squeri | | | 1,164,019 | | | N/A | | | 671,455 | | | | | | C.Y. Le Caillec | | | 12,824 | | | N/A | | | 80,322 | | | | | | D.E. Buckminster | | | 356,302 | | | N/A | | | 254,908 | | | | | | J.C. Campbell | | | 232,820 | | | N/A | | | 254,591 | | | | | | A.D. Williams | | | 412,491 | | | N/A | | | 219,938 | | | | | | L.E. Seeger | | | 250,176 | | | N/A | | | 190,697 | | | | | | All current executive officers as a group | | | 3,175,722 | | | 1,428 | | | 2,487,457 | | | | | | All employees, including all current officers who are not executive officers, as a group | | | 587,642 | | | 7,609,261 | | | 7,475,787 | |
Equity Compensation Plan Information. For the information required by Item 201(d) of Regulation S-K under the Exchange Act, see “Equity Compensation Plans” beginning on page 89.
2024 PROXY STATEMENT 101 • Shareholder Proposals | | | | | Our Board recommends that you voteAGAINSTthis proposal. each shareholder proposal (Items 5-7). |
WilliamShareholders will vote on the following shareholder proposals (Items 5-7), if properly presented at the 2024 Annual Meeting and if not properly withdrawn or excluded. The shareholder proposals and supporting statements appear in the form in which we received them and may contain statements that are incorrect or inaccurate. We make every effort to meet and engage with shareholders and investors and have expanded our shareholder engagement efforts this past year. Each year, we engage directly with shareholder proponents, both before or after their submissions, to discuss their respective proposals and better understand each request. We recognize the importance of these engagements and often use these opportunities to enhance our policies and practices.
Our Board and Management spend a significant amount of time deliberating each proposal, considering feedback, and evaluating whether each proposal would be in the best interest of the Company and our shareholders. Each proposal is discussed extensively with internal and external subject matter experts who have in depth insight into the matters raised in the proposals and the Company’s practices. In assessing each proposal, our Board and Management considers various factors including the engagements with the proponents; feedback from shareholders; the costs and benefits of implementing the proposals’ request; alignment with market practices; and whether the proposal would be in the best interest of the Company and its shareholders. After engaging with the shareholder proponents and careful consideration of each proposal, our Board recommends a vote AGAINST each of these shareholder proposals. Item 5: Shareholder Proposal Relating to Golden Parachutes Kenneth Steiner, c/o Komlossy Law, PA, 4700 Sheridan St. Suite J, Hollywood, FL 3302114 Stoner Ave., 2M, Great Neck, NY 11021-2100, has advised that he is the owner of not less than 100500 common shares and that he intends for Mr. John Chevedden and/or his designee to introduce the following proposal on his behalf. Proposal 5 — Shareholder Opportunity to Vote on Excessive Golden Parachutes 
Shareholders request that the Board adopt a policy to seek shareholder approval of senior managers’ new or renewed pay package that provides for golden parachute payments with an estimated value exceeding 2.99 times the sum of the executive’s base salary plus target short-term bonus. This proposal only applies to Section 16 Officers. Golden parachute payments include cash, equity or other compensation that is paid out or vests due to a senior executive’s termination for any reason. Payments include those provided under employment agreements, severance plans, and change-in-control clauses in long-term equity plans, but not life insurance, pension benefits, or deferred compensation earned and vested prior to termination. “Estimated total value” includes: lump-sum payments; payments offsetting tax liabilities; perquisites or benefits not vested under a plan generally available to management employees; post-employment consulting fees or office expense; and equity awards if vesting is accelerated, or a performance condition waived, due to termination. The Board shall retain the option to seek shareholder approval at an annual meeting after material terms are agreed upon. This proposal is relevant even if there are current golden parachute limits. A limit on golden parachutes is like a speed limit. A speed limit by itself does not guarantee that the speed limit will never be exceeded. Like this proposal the rules associated with a speed limit provide consequences if the limit is exceeded. With this proposal the consequences are a non-binding shareholder vote is required for unreasonably high golden parachutes. This proposal places no limit on long-term equity pay or any other type pay. This proposal thus has no impact on the ability to attract executive talent or discourage the use of long-term equity pay because it places no limit on golden parachutes. It simply requires that extra large golden parachutes be subject to a non-binding shareholder vote at a shareholder meeting already scheduled for other matters. 
• 102 2024 PROXY STATEMENT This proposal is relevant because the annual say on executive pay vote does not have a separate section for approving or rejecting golden parachutes. The topic of this proposal received between 51 % and 65% support at: FedEx Spirit AeroSystems Alaska Air Fiserv This proposal is more important at American Express because the Board seems to have exercised poor judgment in naming Mr. Thomas Baltimore to the AXP board in 2021. Mr. Baltimore was rejected by 33% of shares at Prudential Financial in 2019 and 2020 and then rejected by 30% of shares in 2022. Serious consideration should be given to keeping Mr. Baltimore off of any AXP Board Committee. Mr. Baltimore was rejected by 20% of AXP shares in 2023. It takes much more shareholder conviction to vote against a director than to vote for a director. Please vote yes: Shareholder Opportunity to Vote on Excessive Golden Parachutes—Proposal 5
2024 PROXY STATEMENT 103 • Board of Directors Statement in Opposition Our Board, its Compensation and Benefits Committee and its Nominating, Governance and Public Responsibility Committee have considered this proposal and concluded that its adoption is not in the best interests of the Company or our shareholders. Our Board recommends a vote AGAINST this proposal because: | ¾ | | The proposal is unnecessary because the Company’s current severance plan already limits cash severance payments to Section 16 Officers (Executives) to 1.5 times the sum of the Executive’s base salary plus target annual bonus, which is well below the 2.99 times the sum of the base salary plus target annual bonus noted in the proposal. |
| ¾ | | Payments to terminated Executives, including under our shareholder-approved equity compensation plan, are subject to reasonable and appropriate limits and robust governance oversight. |
| ¾ | | Shareholders already have a voice on executive pay through the annual say-on-pay vote and our active shareholder engagement program. |
| ¾ | | The proposal would hamper the Company’s flexibility with respect to attracting and retaining talent, placing it at a competitive disadvantage to companies and competitors not subject to a similar shareholder approval requirement. |
The Company’s Current Severance Plan Already Limits Cash Severance Payments to Executives to Well Below 2.99 Times the Sum of Base Pay Plus Target Annual Bonus. The American Express Company Senior Executive Severance Plan (Severance Plan), which applies to all Executives globally, is designed to provide Executives with reasonable compensation if their employment is terminated for qualifying reasons. Qualifying terminations generally include terminations without cause, job elimination, and involuntary or constructive terminations within two years following a change in control (CIC); a termination for cause or a voluntary resignation or retirement are not severance qualifying terminations. Our Severance Plan already limits cash severance payments to 1.5 times the sum of the Executive’s base salary plus target annual bonus, which is paid over 18 months. A terminated Executive is also eligible to receive a pro-rata portion of the target annual bonus for the year of termination based on the number of days the Executive was actively employed in that year. Additionally, the Severance Plan restricts any paid notice period to 90 days. Because the Severance Plan limits cash severance to below 2.99 times the sum of base salary plus target annual bonus, the consent requirement contained within this shareholder proposal is unnecessary. While receiving severance pay, our Executives continue to receive certain reasonable employee benefits and their outstanding equity awards continue to vest, subject to certain conditions. In order to receive any benefits under our Severance Plan, the Executive must sign a severance agreement that includes a release of claims, as well as certain restrictive covenants (confidentiality, non-competition, non-solicitation and non-denigration). If an Executive violates the severance agreement, including a breach of the restrictive covenants, further severance and benefits and outstanding unvested equity awards are forfeited and, subject to applicable laws, 95% of the value of previously paid severance, benefits, and the equity awards that vested during the separation period must be repaid to the Company. Under the Company’s annual bonus program, in the event of death, the beneficiary of an Executive may be entitled to receive a pro-rata portion of the deceased Executive’s target annual bonus for the year of death, in order to address the financial impacts that may be associated with the Executive’s death. And in the event of an eligible termination of an Executive within the two-year period following a CIC (a “double trigger” termination), such Executive is entitled to payment of the annual bonus for the year of termination based on the average annual bonus received in the two preceding years. Given that the Company’s existing severance plan already limits cash severance pay for Executives to 1.5 times the sum of the executive’s base salary plus target annual bonus, which is well below 2.99 times the sum of base pay plus annual target bonus, and includes limits that our Board believes are reasonable and appropriate, the proposal is unnecessary. Payments to Terminated Executives, Including Under Our Shareholder-Approved Equity Compensation Plan, are Subject to Reasonable and Appropriate Limits and Robust Governance Oversight. Our Severance Plan and equity compensation plans are subject to the ongoing oversight of the Compensation and Benefits Committee. Prior to an equity award being granted to an Executive, for example, the value and vesting terms are reviewed and approved by the Compensation and Benefits Committee. Our Compensation and Benefits Committee also engages an independent compensation consultant to review external benchmarking data and assist us in developing our executive compensation and benefit programs (including post-employment compensation and benefits) within reasonable and appropriate limits. Thus, we believe our robust governance and compensation setting processes and procedures provide reasonable and appropriate oversight and limits on the post-employment compensation and benefits afforded to our Executives.
• 104 2024 PROXY STATEMENT Shareholders Already Have a Voice on Executive Pay Through the Annual Say-On-Pay Vote and Our Active Shareholder Engagement Program. Existing governance over the plans providing for post-termination payments to Executives further underscores that the proposal’s shareholder approval requirement is unnecessary. Each of our equity compensation plans have been approved by our shareholders. Moreover, our existing plans and policies governing post-employment compensation for Executives are described under “Post-Employment Compensation–Severance: Senior Executive Severance Policy” and “Compensation Discussion and Analysis–Equity Compensation Plan,” and shareholders have the opportunity to address those practices through our annual say-on-pay vote. In the event of any merger, acquisition or other similar event, shareholders would have further opportunities to express their views on any compensation to our Executives in connection with that transaction (including the CIC provisions). Therefore, the shareholder approval requirement contained within this proposal is duplicative and unnecessary. In addition, we actively engage with our shareholders throughout the year in order to, among other things, provide visibility and transparency into our compensation practices. For example, in response to shareholder feedback, we have modified our perquisites policy to eliminate a cash perquisite allowance paid to NEOs and continued to align our compensation program with our strategic priorities. Because of our active shareholder engagement on the post-employment compensation policies, the Board believes additional shareholder voting on “golden parachute payments” is unnecessary and that shareholders already have appropriate avenues for providing input on our compensation practices. We believe this is evident by the fact that a shareholder proposal similar to this one was presented by the same proponent at our annual meeting of shareholders last year and did not achieve majority support. The Proposal Would Hamper the Company’s Ability to Attract and Retain Executive Talent, Placing Us at a Competitive Disadvantage. The Company operates a global enterprise in a highly competitive business environment. We compete for talented executives with some of the world’s largest companies, across a number of business sectors. Our global recognition and reputation for excellence in management and leadership make our Executives attractive targets for other companies, and our Executives are aggressively recruited. As part of our focus on attracting and retaining key talent, we maintain a comprehensive compensation program, an important component of which is market-driven termination protections and the principled use of long-term equity awards. Termination protections afford executives appropriate security so that they can focus their attention and efforts on maximizing performance and shareholder value. Long term equity awards are an effective way to tether executive compensation to maximized long-term shareholder value and, therefore, are commonly used by the employers, including those with whom we compete for talent. We are often called upon to negotiate compensation terms with potential new hires as well as existing Executives who are considering competing job offers. Those negotiations often occur on an expedited basis and include the types of compensation that are contemplated by the proposal such as retention packages, and sign-on/make-whole grants that replace compensation a potential new hire will forfeit by joining American Express. While the proposal allows for the seeking of approval after material terms are agreed upon, it would still require us to add agenda items to our Annual Meeting simply to approve routine and market-aligned executive compensation arrangements, which is impractical and could unduly restrict our ability to recruit and retain qualified Executives. Requiring a shareholder approval (even an advisory vote) may result in significant uncertainty and delays, effectively precluding the Company from quickly and thoughtfully negotiating with and securing talent. The shareholder approval requirement would also infuse an element of uncertainty for potential new hires and existing Executives we are striving to retain if the Compensation and Benefits Committee feels compelled to restructure them as a result of a shareholder vote. The combination of making it more difficult for the Company to secure our existing talent while at the same time also substantially hindering our ability to hire new Executive talent could create significant gaps in our Executive talent ranks. The proposal’s negative impact on our ability to compete for Executive talent is therefore antithetical to the best interests of our shareholders. Board Recommendation In summary, our Board believes that our current executive compensation policies and practices, including our plans and policies governing post-employment compensation, are reasonable and appropriate, and they effectively align the interests of our Executives with those of our shareholders. As fully disclosed in our Proxy Statement, our existing policies already provide reasonable and appropriate governance and limits with respect to post-employment executive compensation. These policies and practices are aligned with market practice, including but not limited to a limit on cash severance payments that is well below 2.99 times the sum of base salary plus annual bonus and the shareholder approval of our incentive compensation plan under which long term equity awards are issued. Through our annual say-on-pay vote and our active shareholder engagement program, our shareholders already have an active voice on our executive compensation policies. Adoption of this proposal could prevent us from effectively recruiting, incentivizing and retaining critical talent and, therefore, would not be in the best interests of our shareholders or the Company. For the reasons described above, our Board recommends that you vote AGAINST this proposal.
2024 PROXY STATEMENT 105 • Item 6: Shareholder Proposal Relating to Climate Lobbying Myra K. Young, 9295 Yorkship Ct, Elk Grove, CA 95758, has advised that she is the owner of not less than 50 common shares and she intends for Mr. James McRitchie and/or Mr. John Chevedden to introduce the following proposal on his behalf:her behalf. Item 4Proposal 6 — Right to Act by Written ConsentReport Climate Lobbying Alignment
Resolved:Shareholders request that our boardthe Board of directors undertake such stepsDirectors annually analyze and report to shareholders (at reasonable cost, omitting proprietary information) on whether and how American Express (“Amex” of “Company”) is aligning its lobbying and policy influence activities and positions, both direct and indirect (through trade associations, coalitions, and other organizations) with its net-zero emissions by 2035 target, including the activities and positions analyzed, the criteria used to assess alignment, and involvement of stakeholders, if any, in the analytical process. Supporting Statement: In evaluating the degree of alignment between the Company’s emissions goals and its lobbying, Amex should consider the policy positions, actual lobbying, and policy influence activities of organizations of which it is a member. This request is consistent with the investor expectations described in the Global Standard on Responsible Climate Lobbying,1 which is a useful resource for implementation. The United Nations Framework Convention on Climate Change asserts that greenhouse gas emissions must decline by 45 percent from 2010 levels by 2030 to limit global warming to 1.5 degrees Celsius. If that goal is not met, even more rapid reductions, at greater cost, will be required to compensate for the slow start.2 Amex has publicly committed to achieving company-wide net-zero emissions by 2035 in alignment with the Science Based Targets initiative.3 Amex has recognized that active engagement in the public policy arena is an essential part of responsible corporate citizenship. In its 2023 ESG Report, climate change was identified as may be necessarythe most important issue to permit written consent by shareholders entitled to castAmex stakeholders.4 However, the minimum numberCompany’s positions and details of votesengagement over specific climate-related policies that would bealign with its own net-zero commitments are unclear. Shareholders would thus benefit if Amex disclosed details on aligning its policy advocacy activities with its climate-related commitments. Despite the recent passage of the Inflation Reduction Act, critical gaps remain between the United States’ Nationally Determined Contributions and necessary climate action. Companies continue to authorize the action at a meeting at which all shareholders entitled to vote thereon were present and voting. This written consent is to be consistent with applicable law and consistent with giving shareholders the fullest power to act by written consent consistent with applicable law. This includes shareholder ability to initiate any topic for written consent consistent with applicable law. This proposal topic won majority shareholder support at 13 major companies in a single year. This included 67%-support at both Allstate and Sprint. Hundreds of major companies enable shareholder action by written consent.
Taking action by written consent in lieu of a meeting is a means shareholders can use to raise important matters outside the normal annual meeting cycle. A shareholder right to act by written consent and to call a special meeting are 2 complimentary ways to bringhave an important matterrole to the attention of both management and shareholders outside the annual meeting cycle. More than 100 Fortune 500 companies provide for shareholdersplay in enabling policymakers to call special meetings and to act by written consent.close these gaps.
American Express shareholders also do not have the full right to call a special meetingCorporate lobbying that is available under state law. According to the lame AXP special meeting provision it would take 25% of shares (instead of 10% per state law) to call a special meeting.
Adoption of this proposal would at least give shareholders a better position to engageinconsistent with the BoardParis Agreement presents increasingly material risks to Amex and management about improvingits shareholders, as delays in emissions reductions undermine political stability, damage infrastructure, impair access to finance and insurance, and exacerbate health risks.
While Amex has disclosed memberships in trade associations, investors lack sufficient information to understand how the qualificationscompany ensures its direct and indirect lobbying aligns with its climate-related commitments, and what actions it takes to address any misalignments. This is concerning given the company’s membership in major trade associations with track records of our directors.opposing science-based climate policies, such as the Business Roundtable5 and the U.S. Chamber of Commerce.6 Sadly American Express had directors with no skin in the game. In 2017 it was reported that 4 American Express directors owned no AXP stock:Vote For Proposal 6
Anne Lauvergeon
Daniel Vasella
Ralph De La Vega
Michael LeavittReport Climate Lobbying Alignment
If our stock slumps these 4 directors have nothing to lose. They can just smile and collect their $350,000 for perhaps 350 hours of work.
Another example of need for improvement is Robert Walter, who as Lead Director, received our 2nd highest negative votes. Mr. Walter had 15-years long-tenure. Long tenure can impair the independence of a director. The Lead Director should have the greatest independence of any director or should give up that role.
Please vote for a best practice in corporate governance:
Shareholder Right to Act by Written Consent - Proposal [4]
| 89https://climate-lobbying.com/
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| 2 | https://unfccc.int/news/updated-ndc-synthesis-report-worrying-trends-confirmed |
| 3 | https://www.ibm.com/about/environment/energy-climate |
| 4 | https://www.americanexpress.com/content/dam/amex/en-us/newsroom/pdfs/AXP_2022-2023_ESG_Report.pdf |
| 5 | https://lobbymap.org/influencer/Business-Roundtable |
| 6 | https://lobbymap.org/influencer/US-Chamber-of-Commerce/projectlink/US-Chamber-of-Commerce-In-Climate-Change |
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2018 Proxy Statement Shareholder Proposals• 106 2024 PROXY STATEMENT
Board of Directors Statement in Opposition TheOur Board and its Nominating, Governance and Public Responsibility Committee have considered this proposal and concluded that its adoption is not in the best interests of the Company or our shareholders. Our Board recommends a vote AGAINST this proposal as it believes such a report is duplicative and unnecessary because:
| 1 | | | | 2 | | | | 3 | | | Our shareholders may effect change by calling a special meeting to raise matters for the review and approval of all shareholders. | | | Permitting action at a meeting (whether the annual meeting or a special meeting) is a more equitable process for shareholders than the written consent process as it provides all shareholders the opportunity to participate, deliberate and vote. | | | Our Board believes that we have a robust corporate governance framework in place that renders this proposal unnecessary. |
Our Board believes that
| ¾ | | The Company has public objectives and goals to advance climate solutions and transition to a low-carbon future. |
| ¾ | | The Company already provides transparent disclosure on our lobbying and political activity and has not engaged in direct lobbying efforts on climate-related issues. |
| ¾ | | The Company has already publicly disclosed how we evaluate our memberships in trade associations, coalitions and other organizations to ensure they serve our long-term interests and align with our values. |
The Company Has Public Objectives and Goals to Advance Climate Solutions and Transition to a Low-Carbon Future In 2021, the Company launched a roadmap for its global ESG strategy, establishing new long-term goals and objectives across three areas for the Company, its stakeholders and society: Build Financial Confidence; Advance Climate Solutions; and Promote DE&I. The Company’s vision for its Advance Climate Solutions pillar is to enhance its operations and capabilities to meet customer and community needs in the transition to a low-carbon future. One objective in furtherance of this vision is to minimize the Company’s climate impact and manage the Company’s climate-related risks and opportunities. Specifically, in 2021 the Company committed to net-zero in alignment with the Science Based Targets initiative (SBTi) as disclosed in our publicly available ESG report. The Company also joined The Business Ambition for 1.5 degrees and the UN Race to Zero Campaign, established by the United Nations Framework Convention on Climate Change to rally leadership for a healthy, resilient and zero-carbon recovery. In 2022, the Company submitted its near- and long-term emissions reduction targets to the SBTi for validation. In 2023, the Company created an internal Net-Zero Working Group comprised of business unit leads to support implementation of thisthe Company’s net-zero strategy across the enterprise. As part of its own operational efforts, the Company has been a member of RE100, a global coalition of businesses committed to 100% renewable electricity, since 2020 and has powered its global operations with 100% renewable electricity since 2018.1 The Company discloses its renewable electricity in alignment with RE100’s Technical Criteria annually. In 2021, the Company became a formal supporter of the Task Force on Climate-Related Financial Disclosures (TCFD). The Company continues to evaluate and disclose climate-related risks and opportunities in alignment with the TCFD recommendations. Also as disclosed in the ESG report, the Company seeks to enable customers and partners to transition to a low-carbon economy through the development of new capabilities, and the Company has already piloted low-carbon product innovations, including carbon insights platforms and offset referral solutions. The Company is also committed to helping build more climate resilient and equitable communities, and has pledged over $20 million to support initiatives, partnerships and programs that address the adverse effects of climate change and pollution on communities from 2021 through December 2023, as well as engaged in colleague-led sustainability initiatives through our Green2Gether program. The Company has public objectives and goals to advance climate solutions and transition to a low-carbon future, and has made progress on its Advance Climate Solutions vision, including managing climate-related risks and opportunities, creating and piloting tools that enable customers to transition to a low-carbon future, and providing grants and working with organizations to back low-carbon communities. The Company Already Provides Transparent Disclosure on Our Lobbying and Political Activity and Has Not Engaged in Direct Lobbying Efforts on Climate-Related Issues The Company provides robust and transparent disclosure on its lobbying and political activity through its ESG report, Lobbying Disclosure Act filings and Semi-Annual Political Contributions Reports, all of which are publicly available. While the Company has not engaged in any direct lobbying efforts with policymakers on climate-related policies or issues, it is a member of a number of trade associations, coalitions and other organizations that have active climate working groups and participate in lobbying activities, including American Bankers Association, California Bankers Association, etc., an illustrative list of which is included in our ESG report. Each trade or industry association is required by law to identify the portion of dues or payments made that are used for lobbying purposes. A list of the principal U.S. trade and industry associations to which the Company paid annual dues of $50,000 or more in the most recent fiscal year and the portion of the dues used for lobbying purposes is already | 1 | Operations include all managed facilities, field sites and data centers. Managed facilities are individual properties operationally managed by the Company’s global real estate team and housing critical business functions. Field sites are individual properties that are not operationally managed by the Company’s global real estate team but directly by its business units. They are typically smaller sites, less than 30,000 square feet (including airport lounges, foreign exchange kiosks, and sales offices), that are owned or leased by American Express. |
2024 PROXY STATEMENT 107 • provided in the Company’s Semi-Annual Political Contributions Reports, which are publicly available on its website. Therefore, an additional annual report such as that requested by the proposal is unnecessary, given the ability of shareholders to call special meetings which allow for shareholder action between annual meetings in an orderly and equitable manner. As permitted by New York State law, the Company’s by-laws provide that shareholders holding 25 percent or moreextent of the Company’s outstanding common shares may callexisting public disclosure on its lobbying and political activity. The Company Has Already Publicly Disclosed How It Evaluates Memberships in Trade Associations, Coalitions and Other Organizations to Ensure They Serve the Company’s Long-Term Interests and Align with Its Values The Company participates in trade and industry associations because they offer a special meeting. Our Board continuesvariety of benefits that are important to believeits business and will ultimately enhance value to shareholders, including monitoring industry policies and trends, providing industry and market expertise and advancing the Company’s public policy interests. The Company’s participation in a trade or industry association does not mean that the 25 percent ownership requirement for the right of shareholders to call special meetings is a reasonable and appropriate balance between enhancing shareholder rights and protecting against the riskCompany agrees with every position that a small minoritytrade or industry association takes on an issue, but it does provide an opportunity to engage and provide perspectives on a variety of shareholders could initiate actionstopics, including climate-related policies. Trade associations are membership organizations that are notled by consensus, and the Company cannot control the majority view, or the resulting activity of a given trade association on any particular issue. However, the Company expresses its stance in the bestevent that a trade group is advocating in a way that does not align with its goals and will continue to do so during its engagement. Further, the Company evaluates its memberships in trade associations to ensure that they serve the long-term interests of the majorityCompany and its shareholders and that they align with the Company’s values, including our commitment to net-zero emissions and a low-carbon future. We create long-term relationships with trade and industry associations that share our interests on ESG matters and collaborate with them to achieve common goals. To determine the appropriate level of our shareholders.engagement, the Company’s government affairs team coordinates with colleagues across the business to periodically review and assess the potential impacts of key public policy issues for the Company globally, as well as any potential misalignment of those impacts with the Company’s goals. The government affairs team briefs the Board, through its Nominating, Governance and Public Responsibility Committee, on the process to identify the issues on which the Company engages, and the team regularly updates the Nominating, Governance and Public Responsibility Committee on the public policy issues of importance to the Company and any issues where they have chosen to engage with government officials. Currently, shareholders may propose any proper matter for a vote either through a special meeting or at ourThe Company maintains comprehensive compliance procedures to ensure that its activities are conducted in accordance with its policy engagement and political activity policy, the Company’s Code of Conduct and all relevant laws governing political contributions and lobbying activities. Such compliance procedures include employees’ annual meeting. Implementationreview and acknowledgment of this proposal,their Code of Conduct responsibilities, as well as periodic reviews conducted by contrast, could permit fundamental corporate changes to occuran outside law firm and internal audit. The Nominating, Governance and Public Responsibility Committee has oversight over the Company’s public policy positions, the manner in which the Company conducts its government relations activities and the nature and amount of a meetingthe Company’s political contributions. Based on the transparency of the Company’s existing disclosure and without notice to other shareholders or time for thoughtful considerationthe Company’s effective oversight, policies and deliberation. Ourprocedures regarding lobbying and political engagement activities, the Board believes that permitting action at a meeting (whetheran additional report such as that requested by the annual meeting or a special meeting) is a more equitable process than the action by written consent process as it provides all shareholders the opportunity to participate and vote. Meetings are held at a time, date and venue announced publicly in advance, and all shareholders receive prior notice of the meeting and are invited to attend, vote in person or by proxy, and make their views known. To the contrary, the shareholder proposal would allow shareholders owning slightly over 50 percent of the Company’s outstanding sharesnot add value to act on a significant matter without prior notice of the meeting to all shareholders and without affording all shareholders the opportunity to present their views. This would disenfranchise shareholders who are not given the chance to participate. In addition, the action by written consent process could result in duplicative or contradictory written consents being circulated at the same time, creating substantial confusion and disruption among shareholders.
Contrary to the information in the shareholder proposal, our Corporate Governance Principles require that each director attain a personal holding of American Express shares (inclusive of SEUs) with a value of at least $1,000,000 within five years of joining the Board. All of our directors either have or are on track to meet this requirement.
Additionally, our Board believes that the strong corporate governance processes in place at the Company make the adoption of this shareholder proposal unnecessary. In addition to the special meeting right highlighted above, certain of our corporate governance practices and policies that serve to enhance Board accountability include:Recommendation
● | Our adoption in 2016 of by-law amendments that implement “proxy access,” allowing eligible shareholders to include their own nominees for director in our proxy materials along with the Board-nominated candidates; | ● | Annual election of all directors; | ● | Majority vote standard to elect directors; | ● | Our director share ownership requirement; | ● | Our shareholders’ right to directly communicate with and raise concerns to the Board or an individual director; and | ● | Our robust and ongoing shareholder engagement process that allows shareholders to bring matters to the attention of the Board and management outside of the annual meeting process. |
In summary, our Board believes that the implementation of this shareholder proposal is not in the best interests of shareholders or the Company or our shareholders and is duplicative and unnecessary, given that (i) the ability of shareholdersCompany has public objectives and goals to call special meetingsadvance climate solutions and transition to a low-carbon future; (ii) the Company’s strong corporate governance practicesCompany already provides transparent disclosure on our lobbying and policies.political activity and has not engaged in direct lobbying efforts on climate-related issues; and (iii) the Company has already publicly disclosed how we evaluate our memberships in trade associations, coalitions and other organizations to ensure they serve our long-term interests and align with our values. Publishing an additional report narrowly focused on climate-related lobbying would be duplicative and would not provide any additional meaningful information to our shareholders. For the reasons described above, the Board recommends that you vote AGAINST this proposal.
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• 108 2024 PROXY STATEMENT Item 7: Shareholder Proposals2018 Proxy StatementProposal Relating to Merchant Category Codes ITEM | 5 | Shareholder Proposal Relating to
Independent Board Chairman
| Our Board recommends that you voteAGAINSTthis proposal. |
Myra K. Young, 9295 Yorkship Court, Elk Grove, CA 95758,National Center for Public Policy Research has advised us that she is the owner of 50 common shares and that sheit intends for Mr. John Chevedden to introduce the following proposalproposal.
Proposal 7 — Report on her behalf:Company’s Policy on Merchant Category Codes Item 5 — Independent Board ChairmanSupporting Statement: In an effort to appease anti-Second Amendment advocates, the Company previously considered tracking firearms purchases through the use of merchant category codes (though it paused that project in early 2023).1 To do so, the Company would have separately categorized sales at firearms stores, which were previously labeled as “general merchandise” sales.2
Shareholders request our BoardBroadly categorizing sales at firearms stores, however, unduly targets those who seek to obtain firearms in a lawful manner and does nothing to address violence by those who obtain firearms through illicit means. Indeed, a University of DirectorsPittsburgh study found that lawful gun owners commit less than a fifth of all gun crimes.3
It is also unclear to adoptwhat extent the merchant category code information from firearm store sales would be shared with law enforcement or other governmental entities. For instance, banks and other card issuers already block card purchases considered risky or prone to fraud and act as policy,agents of the government in monitoring payments for suspicious activity, including transactions that could finance terrorism.4 As such, included in this risk evaluation should be a consideration of whether the best choice is not to track these lawful and amend our governing documentsconstitutionally protected purchases in any way, as necessary,well as the dangers associated with sharing any information gathered with government representatives whose use of the information can only be to require henceforthsurveil and harass those who exercise their lawful right to keep and bear Arms.5 About 40% of Americans say they or someone in their household owns a gun, and 22% of individuals (about 72 million people) report owning a gun.6 And given valid concerns over the privacy of gun ownership – case in point, the tracking of purchases from firearms stores by financial institutions – it is very likely those numbers are even higher. The Company should therefore carefully evaluate the potential risks to its bottom-line and its customers before it further embraces the agenda of the anti-Second Amendment lobby. Given that the Chairoriginal initiative to track gun and ammunition purchases was paused, shareholders would benefit from transparency regarding the issue of how the Board of Directors whenever possible,of American Express is overseeing any final position taken on any MCC application for standalone gun and ammunition stores, and whether American Express is appropriately considering the risks inherent in its oversight of this matter. Failure to be an independent memberdo so may expose the Company to regulatory, reputational, and litigation risks that may threaten long-term shareholder value. Resolved: Shareholders request that the American Express Company (the Company) Board of Directors issue a public report, omitting proprietary and privileged information, concerning its oversight of management’s decision-making regarding the Board. The Board would have the discretion to phase in this policy for the next CEO transition, implemented so it does not violate any existing agreement. If the Board determines that a Chair who was independent when selected is no longer independent, the Board shall select a new Chair who satisfies the requirements of the policy within a reasonable amount of time. Compliance with this policy is waived if no independent director is available and willing to serve as Chairman. This proposal requests that all the necessary steps be taken to accomplish the above.
Caterpillar is an examplepotential use of a company recently changing coursemerchant category code (MCC) for standalone gun and namingammunition stores. This report should cover the Company’s governance of MCC standards, as well as disclose and explain the justification for its position on an independent board chairman. Caterpillar had strongly opposed a shareholder proposalMCC for an independent board chairman as recently asgun and ammunition stores, and the risk associated with its 2016 annual meeting. Wells Fargo also changed course and named an independent board chairman in 2016.position.
It was reported that 53% of the Standard & Poors 1,500 firms separate these 2 positions (2015 report). This proposal topic won 50%-plus support at 5 major U.S. companies in 2013 including 73%-support at Netflix.
A number of institutional investors said that a strong, objective board leader can best provide the necessary oversight of management. Thus, the California Public Employees’ Retirement System’s Global Principles of Accountable Corporate Governance recommends that a company’s board should be chaired by an independent director, as does the Council of Institutional Investors. An independent director serving as chairman can help ensure the functioning of an effective board.
This proposal topic won 37% support at our 2016 annual meeting. This 37%-support would have been higher (perhaps 42%) if small shareholders had the same access to corporate governance information as large shareholders.
According to Proxy Insight, 238 funds in their database voted for this proposal topic at AXP – 3-times as many funds as voted against. Unfortunately, large funds like Vanguard and BlackRock voted against, while State Street abstained. We hope they and others will reconsider their position this year, given that our CEO/Chair, with 20-years long-tenure, received the highest negative vote of any director last year.
Our Lead Director had 15-years long-tenure and got the second highest negative vote. Long-tenure can impair the independence of a director no matter how well qualified. Independence is an all-important qualification for a Lead Director. A Lead Director needs to be more independent than any other director.
An independent chairman can also focus on improving the qualification of our directors. For instance 4 directors were reported as owning no stock in 2017.
Please vote to enhance Board oversight of our CEO:
Independent Board Chairman - Proposal [4]
| 91https://www.reuters.com/business/finance/mastercard-pause-work-new-payments-code-firearms-sellers-2023-03-09/
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| 2 | https://www.foxbusiness.com/economy/visa-mastercard-amex-categorize-gun-store-sales-separately |
| 3 | https://www.upmc.com/media/news/fabio-firearms ; https://www.washingtonpost.com/news/wonk/wp/2016/07/27/new-evidence-confirms-what-gun-rights-advocateshave-been-saying-for-a-long-time-about-crime/ ; https://www.heritage.org/firearms/commentary/eight-stubborn-facts-gun-violence-america |
| 4 | https://www.wsj.com/articles/visa-mastercard-amex-to-track-gun-shops-with-new-merchant-code-11662915056 |
| 5 | https://www.law.cornell.edu/wex/second_amendment#:~:text=The%20Second%20Amendment%20of%20the,reg ar |
| 6 | https://wamu.org/story/20/09/18/how-many-people-in-the-u-s-own-guns/ |
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2018 Proxy Statement Shareholder Proposals2024 PROXY STATEMENT 109 •
Board of Directors Statement in Opposition TheOur Board and its Nominating, Governance and Public Responsibility Committee have considered this proposal and concluded that its adoption is not in the best interests of the Company or our shareholders. Our Board recommends a vote AGAINST this proposal because:
| 1 | | | | 2 | | | | 3 | | | Our Board believes it is important to maintain the flexibility to choose the leadership structure that will best fit the Company’s circumstances and Board composition at any particular time and that mandating a set leadership structure regardless of the circumstances could impede the Board’s effectiveness and ability to act in the best interests of the Company and its shareholders. | | | Our Board recently reviewed our Company’s leadership structure in connection with the Company’s recent transitions, as outlined onpage 17 of the proxy, and chose to maintain a unified Chairman and CEO role combined with a Lead Independent Director with clearly defined and significant responsibilities. | | | Our Board believes that this leadership structure along with active independent director committee chairs, and independent-minded, skilled and committed directors, provides an appropriate framework for effective board oversight and best serves the interests of our shareholders at this time. |
Our Boardas it believes that any decision to separate the roles of Chairman and CEO should be within a board’s discretion and based on the specific circumstances of a corporation, the independence and capabilities of its directors, and the leadership provided by its CEO and Lead Independent Director. Our Board does not believe that separate roles for the Chairman and CEO should be mandated or that such a separation would, by itself, deliver an additional benefit for shareholders.report is unnecessary because:
Our Board is led by a combination of our Lead Independent Director and our Chairman and CEO, supplemented by engaged independent director committee chairs and independent-minded, skilled and committed directors. Our Board believes that this leadership structure creates an environment in which the Board can work effectively and communication flows efficiently between management and the Board. Moreover, this structure creates a suitable climate for independent directors to appropriately make inquiries of and challenge management. As described in detail onpage 17, the succession planning discussions regarding the recent transitions included extensive discussions of the Board’s leadership structure. At the conclusion of those discussions, the Board determined that having Mr. Squeri as one clear leader in both the Chairman and CEO roles who has unparalleled company expertise and deep industry experience alongside a strong Lead Independent Director provides the best leadership structure
| ¾ | | The Company uses the industry’s standard approach of broadly categorizing a merchant’s primary business according to merchant category codes (MCCs), which are created by the International Organization for Standardization (ISO), a Geneva-based non-governmental organization. |
| ¾ | | The Company respects the individual choices and privacy of its customers and merchants, and does not and cannot use MCCs to track product-level purchases made by individual customers. |
| ¾ | | The Company is required to comply with applicable laws, including with respect to the use of MCCs, and we are currently evaluating any implementation of the MCC that was approved by the ISO in 2022 for gun and ammunition stores (MCC 5723) in light of laws that prohibit, restrict or require its use by payment card issuers / networks like the Company, at this time. As evidenced below, we believe that the strong governance framework that we have in place supports the objective and independent Board leadership structure necessary to effectively challenge and oversee management.
● | All of our Board members are independent within the meaning of the applicable laws, with the exception of the Chairman and CEO. | ● | We have a Lead Independent Director with significant responsibilities that are described in detail onpage 18. We believe that his role is clearly defined and robust, and that combined with his extensive understanding of our business and the Company gleaned from his years on our Board, his past experience as a Chairman and CEO of a public company and his willingness and ability to devote the time required to serve in this role, make him exceptionally well qualified to serve as our Lead Independent Director. | ● | Our independent directors meet frequently in executive sessions that are chaired by our Lead Independent Director with no members of management present. Independent directors use these executive sessions to discuss matters of concern as well as any matter they deem appropriate, including evaluation of senior management, CEO and management succession, matters to be included on Board agendas, Board informational needs, Board priorities and Board effectiveness.similar proposed legislation pending in several states. |
Table of ContentsMCCs – The Industry Standard Approach
Shareholder Proposals2018 Proxy StatementAmerican Express is a globally integrated payments company that offers its products and services worldwide. Processing payments is central to the Company’s business, with the Company offering credit card, charge card, banking and other payment and financing products as well as merchant acquisition and processing services. There are many entities in addition to the Company that are involved in processing payment transactions that utilize the Company’s network, including but not limited to:
●¾ | Each committee operates under | financial institutions with whom the Company has a written charter that has been approved by the Board and that details oversight of key matters.direct relationship; |
●¾ | The chairs—and all members— | merchants with whom the Company does or does not have a direct relationship, with the latter representing the majority of merchants in the Audit and Compliance, Nominating and Governance, Compensation and Benefits, and Risk Committees, are independent directors. These committees also have access to and utilize independent external advisors.U.S.; |
●¾ | Our Board conducts a formal annual evaluation of the Chairman | payment providers that enable card acceptance at merchants; and CEO in an executive session where he is not present. | ● | All directors have full access to all members of management and all employees on a confidential basis. |
| ¾ | | technology partners involved in specific types of activities (e.g., digital wallets). |
The industry standard approach for nearly two decades is to broadly categorize a merchant’s primary business according to merchant category codes. The creation of new MCCs is assessed and approved by the ISO. There are hundreds of MCCs currently in effect that are assigned to millions of merchants where the Company’s payment products may be used for transactions, and MCCs are merely one of several data points that help identify the industries in which merchants operate. MCCs cannot be used to track product-level purchases made by individual customers. The proposal’s suggestion that the use of MCCs would target lawful firearms sales is therefore based on a fundamental misunderstanding of the way in which MCCs are used by the Company and other participants in the payments industry. Data Collection and Usage The Company does not and cannot use MCCs to track specific products or services purchased on its cards by individual customers, as MCCs provide information only with respect to a merchants’ primary business and do not provide Stock Keeping Unit (SKU) level data that is associated with specific products or services purchased at a merchant. For example, when a customer uses their card to make a purchase at a sporting goods store, the Company does not know whether that customer purchased a tennis racquet or a bathing suit or a basketball. Because MCCs do not and cannot identify individual products or services sold by a merchant, the Company does not obtain any information regarding the specific products or services its customers have purchased from a merchant as a result of the use of any MCC code. Furthermore, because MCCs are assigned to merchants and not to individual customers, products or services, the Company does not and cannot use MCCs to identify specific products or services purchased by customers. When it comes to guns and ammunition purchases, the Company’s position has been and remains that its customers are able to make firearm purchases using the Company’s cards wherever legally permitted and the cards are accepted. Furthermore, the Company has a longstanding commitment to customer privacy. The Company’s robust data privacy program outlines which information it may collect and how customers may manage their own data privacy preferences. The Company will continue to respect the individual choices and privacy of its customers and merchants, while maintaining appropriate controls to meet its regulatory and legal responsibilities.
• 110 2024 PROXY STATEMENT Implementation of MCC 5723 When ISO creates a new MCC, the Company works with third-party processors and partners to implement the MCC. These partners are responsible for ensuring the most accurate MCC is assigned to each of their merchants. The ISO created and approved MCC 5723 for gun and ammunition stores in September 2022. The Company initially announced that it would implement MCC 5723, as did other payment processing businesses, but then paused its implementation of MCC 5723 in March 2023 in light of proposed legislation in multiple U.S. states. Specifically, since the creation of MCC 5723, a number of states, including Texas, Florida, Montana, North Dakota, West Virginia, Mississippi and Idaho, have passed legislation that, among other things, prohibits or restricts the use of MCC 5723 by payment card issuers / networks like the Company and similar proposed legislation is pending in several other states. At the same time, one state (California) has passed legislation requiring payment card networks like the Company to, among other things, make MCC 5723 available on its network for certain merchants by as early as July 1, 2024. Given the uncertainty created by varying and potentially conflicting state laws, as well as the ongoing nature of these developments, the Company is currently monitoring and evaluating the risks associated with the potential use of MCC 5723 to ensure compliance with applicable federal and state laws and regulations. Because the Company is required to comply with these laws if and when they take effect, the report requested by the proposal is unnecessary. Board Recommendation In summary, our Board continues to believebelieves that our current leadership structure has served our shareholders well and remains in our shareholders’ best interests. We believe that our Chairman and CEO hasproducing the deep knowledgereport sought by this proposal is unnecessary. The proposal is based on a misunderstanding of the businessinformation that the Company obtains from its use of MCCs and day-to-day operationsis not in the best interests of the shareholders or the Company. MCCs do not provide the Company clear graspwith any product-level information for purposes of tracking, collecting or sharing individual customer purchases. The Company will continue to monitor and evaluate the Company’s competitive landscape, understandingrisks associated with the use of shareholder interests, and relationships with customers, business partners, and employees to allow him to provide effective leadership. Moreover, we believe our Lead Independent Director has a clearly defined and significant role and responsibilitiesMCC 5723 to ensure effective oversightcompliance with applicable federal and governance by an independent Board.state laws and regulations, while respecting the individual choices and privacy of customers. For the reasons described above, our Board recommends that you vote AGAINSTthis proposal. |
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2024 PROXY STATEMENT 111 • Stock Ownership Information The table below shows how many American Express Company common shares certain individuals and entities beneficially owned on March 13, 2018.8, 2024, except as noted. These individuals and entities include: (1) owners of more than 5 percent5% of our outstanding common shares; (2) our current directors and nominees; (3) the executive officers named in the Summary“Summary Compensation TableTable” onpage 74;74; and (4) all current directors, nominees and executive officers as a group. A person has beneficial ownership of shares if the person has voting or investment power over the shares or the right to acquire such power within 60 days. Investment power means the power to direct the sale or other disposition of the shares. Each person has sole voting and investment power over the shares, except as we describe below. The “Number of Shares Owned” column does not include restricted stock units granted to executive officers or SEUs owned by directors because they are not beneficially owned under SEC rules. The SEUs credited to the directors’ accounts as of December 31, 20172023 are shown in the last column in the table below. | Name | | Number of
Shares Owned(4) | | | Right to
Acquire(5) | | Percent of Class
(%) | | Number of SEUs
Owned by Director | | Warren Buffett | | | | | | | | | | | Berkshire Hathaway Inc. | | | | | | | | | | | and subsidiaries | | | | | | | | | | | 3555 Farnam Street | | | | | | | | | | | Omaha, NE 68131 | | 151,610,700 | (1) | | — | | 17.6% | | N/A | | The Vanguard Group, Inc. | | | | | | | | | | | 100 Vanguard Blvd. | | | | | | | | | | | Malvern, PA 19355 | | 48,642,902 | (2) | | — | | 5.6% | | N/A | | BlackRock, Inc. | | | | | | | | | | | 55 East 52ndStreet | | | | | | | | | | | New York, NY 10055 | | 43,090,501 | (3) | | — | | 5.0% | | N/A | | Charlene Barshefsky | | 20,134 | | | — | | * | | 60,399 | | John J. Brennan | | 4,000 | | | — | | * | | 3,693 | | Douglas E. Buckminster(6) | | 83,906 | | | 174,569 | | * | | N/A | | Ursula M. Burns(7) | | 16,000 | | | — | | * | | 69,956 | | Jeffrey C. Campbell(8) | | 86,768 | | | 121,462 | | * | | N/A | | Kenneth I. Chenault(9) | | 1,313,567 | | | 1,299,417 | | * | | N/A | | Peter Chernin | | 18,300 | | | — | | * | | 36,964 | | Ralph de la Vega | | — | | | — | | * | | 6,162 | | Anne Lauvergeon | | — | | | — | | * | | 17,683 | | Michael O. Leavitt | | — | | | — | | * | | 11,528 | | Theodore J. Leonsis | | 20,000 | | | — | | * | | 25,505 | | Richard C. Levin | | 2,000 | | | — | | * | | 32,892 | | Samuel J. Palmisano | | 550 | | | — | | * | | 13,941 | | Laureen E. Seeger | | 35,184 | | | 17,777 | | * | | N/A | | Stephen J. Squeri | | 213,890 | | | 87,689 | | * | | N/A | | Daniel L. Vasella | | — | | | — | | * | | 22,357 | | Robert D. Walter | | 230,000 | | | — | | * | | 53,522 | | Ronald A. Williams | | 59,125 | | | — | | * | | 60,351 | | Christopher D. Young | | — | | | — | | * | | — | | All current directors, nominees and | | | | | | | | | | | executive officers (25 individuals)(10) | | 1,019,446 | | | 607,602 | | * | | 414,953 |
| | | | | | | | | | | | | | | | | | | | | | | | | | Name | | Number of
Shares Owned(4) | | Right to
Acquire(5) | | Percent of
Class (%) | | Number of SEUs
Owned by Director | | | | | | Warren Buffett Berkshire Hathaway Inc. and subsidiaries 3555 Farnam Street Omaha, NE 68131 | | | | 151,610,700 | (1) | | | | — | | | | | 20.9 | % | | | | N/A | | | | | | | The Vanguard Group, Inc. 100 Vanguard Blvd. Malvern, PA 19355 | | | | 46,637,192 | (2) | | | | — | | | | | 6.4 | % | | | | N/A | | | | | | | BlackRock, Inc. 55 East 52nd Street New York, NY 10055 | | | | 44,114,286 | (3) | | | | — | | | | | 6.1 | % | | | | N/A | | | | | | | Thomas J. Baltimore | | | | 324 | | | | | — | | | | | * | | | | | 6,351 | | | | | | | John J. Brennan | | | | 4,000 | | | | | — | | | | | * | | | | | 23,851 | | | | | | | Douglas E. Buckminster | | | | 139,818 | | | | | 324,866 | | | | | * | | | | | N/A | | | | | | | Jeffrey C. Campbell(6) | | | | 145,529 | | | | | 233,189 | | | | | * | | | | | N/A | | | | | | | Peter Chernin | | | | 18,300 | | | | | — | | | | | * | | | | | 50,358 | | | | | | | Walter J. Clayton III | | | | 2,000 | | | | | — | | | | | * | | | | | 2,308 | | | | | | | Ralph de la Vega | | | | — | | | | | — | | | | | * | | | | | 20,766 | | | | | | | Theodore J. Leonsis | | | | — | | | | | — | | | | | * | | | | | 39,163 | | | | | | | Christophe Y. Le Caillec | | | | 4,397 | | | | | 8,000 | | | | | * | | | | | N/A | | | | | | | Deborah P. Majoras | | | | 23 | | | | | — | | | | | * | | | | | 1,769 | | | | | | | Karen L. Parkhill | | | | 1,102 | | | | | — | | | | | * | | | | | 6,434 | | | | | | | Charles E. Phillips | | | | — | | | | | — | | | | | * | | | | | 6,478 | | | | | | | Lynn A. Pike | | | | 1,065 | | | | | — | | | | | * | | | | | 6,434 | | | | | | | Laureen E. Seeger | | | | 57,692 | | | | | — | | | | | * | | | | | N/A | | | | | | | Stephen J. Squeri(7) | | | | 230,096 | | | | | 373,670 | | | | | * | | | | | N/A | | | | | | | Daniel L. Vasella | | | | — | | | | | — | | | | | * | | | | | 42,019 | | | | | | | Lisa W. Wardell | | | | — | | | | | — | | | | | * | | | | | 6,270 | | | | | | | Anré D. Williams(8) | | | | 79,490 | | | | | 113,003 | | | | | * | | | | | N/A | | | | | | | Christopher D. Young | | | | — | | | | | — | | | | | * | | | | | 16,470 | | | | | | | All current directors, nominees and executive officers (29 individuals)(9) | | | | 778,314 | | | | | 1,066,879 | | | | | * | | | | | 228,671 | |
| * | Less than one percent.1% |
| (1) | Based on information contained in a report on Form 13F that Berkshire Hathaway Inc. (Berkshire) filed with the Securities and Exchange Commission,SEC, which contained information provided by Berkshire as of December 31, 2017.2023. Of the shares listed in the table, National Indemnity Co. and its subsidiaries beneficially owned 120,141,879149,061,045 shares. National Indemnity Co. is a subsidiary of Berkshire. Mr. Buffett, Berkshire and certain subsidiaries of Berkshire share voting and investment power over these shares. Based on information provided to the Company, Mr. Buffett owned 32.0 percent31.1% of the aggregate voting power of the outstanding shares of Berkshire’s Class A Common Stock and Class B Common Stock. As a result of this ownership position in Berkshire, Mr. Buffett may be considered the beneficial owner of the shares that Berkshire beneficially owns. |
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Stock Ownership Information2018 Proxy Statement• 112 2024 PROXY STATEMENT
| In 1995, we signed an agreement (as amended from time to time) with Berkshire designed to ensure that Berkshire’s investment in our Company will be passive. The agreement remainspassivity commitments remain in effect as long as Berkshire owns 10 percent10% or more of our voting securities. Berkshire made similar commitments to the Board of Governors of the Federal Reserve System. Berkshire and its subsidiaries have also agreed to follow our Board’s recommendations in voting company common shares they own up to 17% of our shares outstanding as long as Mr. Squeri is our chief executive officerCEO and Berkshire owns 5 percent5% or more of our voting securities. With certain exceptions, Berkshire and its subsidiaries may not sell companyCompany common shares to any person who owns more than 5 percent5% of our voting securities or who attempts to change the control of the Company. |
| (2) | Based on information contained in a report on Form 13G that The Vanguard Group, Inc. (Vanguard) filed with the Securities and Exchange Commission,SEC, which contained information provided by Vanguard as of December 31, 2017.2023. |
| (3) | Based on information contained in a report on Form 13F13G that BlackRock, Inc. (BlackRock) filed with the Securities and Exchange CommissionSEC, which contained information provided by BlackRock as of December 31, 2017.2023. |
| (4) | This column includes shares held in RSP and ESOP accounts on March 13, 2018,8, 2024, as follows: |
| | | | | | | | Name | | Number of Shares in RSP and ESOP Accounts | | | K.I. Chenault | 25,031 | Stephen J. Squeri | S.J. Squeri | | 119 | 128 | | | | Christophe Y. Le Caillec | J.C. Campbell | | | — | | | | D.E. Buckminster | 13,260 | Douglas E. Buckminster | L.E. Seeger | | | — | | | | Jeffrey C. Campbell | | | | — | | | | Anré D. Williams | | | | 11 | | | | Laureen E. Seeger | | | | — | | | | All current executive officers (11(16 individuals)* | | 16,473 | | 7,072 | |
* | This amount does not include Mr. Chenault, who was succeeded by Mr. Squeri on February 1, 2018. |
| (5) | These are shares that the named individuals have the right to acquire within 60 days of March 8, 2024 upon the exercise of SOsstock options or the vesting of RSUsperformance restricted stock units they hold. |
| (6) | Includes 51,13237,222 shares held in family trusts in respect of which Mr. Buckminster holds voting and investment power. | (7) | Includes 5,519 shares held in family trusts in respect of which Ms. Burns holds voting and investment power. | (8) | Includes 86,767 shares held in family trustsa revocable grantor trust in respect of which Mr. Campbell holdsand his spouse are the trustees and hold shared voting and investment power. |
(9)(7) | Includes 106,090114,785 shares held in family trustsa grantor retained annuity trust in respect of which Mr. Chenault sharesSqueri is the trustee and holds sole voting and investment powerpower. |
| (8) | Includes 79,480 shares held jointly with adirected trustee.his spouse in respect of which Mr. Williams holds shared voting and investment power. |
(10)(9) | On March 13, 2018,8, 2024, the current directors, nominees and executive officers beneficially owned 1,627,0481,845,193 shares or about 0.2 percent0.3% of our outstanding shares. No current director, nominee or executive officer beneficially owned more than 1 percent1% of our outstanding shares. This amount doesCurrent executive officers do not include Mr. Chenault,Campbell, who was succeeded by Mr. Squeriretired on FebruaryMarch 1, 2018.2024. |
2024 PROXY STATEMENT 113 • Delinquent Section 16(a) Beneficial Ownership Reporting ComplianceReports Section 16(a) of the Securities Exchange Act of 1934 requires our directors, officers and beneficial owners of 10 percent10% or more of our common shares to file reports with the SEC. We assist our directors and officers by monitoring transactions and completing and filing these reports on their behalf. Based on our records and other information, we believe that all reports that were required to be filed under Section 16(a) during 2017,2023, were timely filed.filed except as follows. Due to a technical error that delayed the acceptance of filings by the SEC by one day, the following individuals have one late Form 4 reporting the vesting of shares/options: Douglas Buckminster, Howard Grosfield, Monique Herena, Raymond Joabar, Rafael Marquez, Anna Marrs, David Nigro, Denise Pickett, Ravikumar Radhakrishnan, Jessica Lieberman Quinn, Elizabeth Rutledge, Jennifer Skyler and Anré Williams.
• 114 2024 PROXY STATEMENT Other Information Attending the Virtual Annual Meeting of Shareholders and Webcast Admission After careful consideration, our Board and Management have decided to hold this year’s Annual Meeting of Shareholders virtually. We believe that a virtual-only Annual Meeting will increase shareholder participation by allowing all shareholders to attend and participate from any location with internet connectivity. In addition to increasing shareholders’ participation, our Board and Management considered the cost savings and additional efficiencies resulting from not having an in-person annual meeting. We will be taking the following steps to ensure that all shareholders have a consistent experience and are afforded the same opportunities and rights as at an in-person annual meeting: | | 95Shareholders will have the ability to submit questions before the Annual Meeting at www.proxyvote.com and logging in using their 16-digit control number;
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| ¾ | | Shareholders will have the ability to listen, vote and submit questions during the Annual Meeting via the virtual meeting website at www.virtualshareholdermeeting.com/AXP2024 and logging in using their 16-digit control number; |
| ¾ | | Shareholder proponents will have a dedicated live line to present their proposals, or if they choose, submit a pre-recorded message; |
| ¾ | | The agenda, Rules of Conduct and Procedures and the presentation materials will be posted on the virtual meeting platform at the time of the meeting and on our Investor Relations webpage; |
| ¾ | | Shareholders will be able to examine the list of shareholders as of the record date by on the virtual meeting website; |
| ¾ | | Shareholders without a control number may attend and listen to the virtual Annual Meeting of Shareholders as a guest but will not have the ability to vote, ask questions, or otherwise participate in the Annual Meeting; and |
| ¾ | | Real-time closed captioning will be available. |
Shareholders may begin logging in to the virtual meeting website at 8:45 a.m. Eastern Time. Other InformationQuestion & Answer Session
AttendingAs part of the Annual Meeting of Shareholders, we will hold a Q&A session, during which we intend to answer as many questions submitted prior to and Webcast
Admission
We do not require ticketsduring the meeting as time permits. Questions must comply with the Rules of Conduct and Procedure, which will be made available on the virtual meeting website at www.virtualshareholdermeeting.com/AXP2024. By attending the virtual Annual Meeting of Shareholders, you agree to abide by the Rules of Conduct and Procedures for admissionthe Annual Meeting. Questions that are related to personal grievances or customer-related matters, related to material non-public information of the Company, or irrelevant to the meeting but do limit attendance to shareholders asbusiness of the record dateCompany or their proxy holders. Please bring proofto the Annual Meeting of your common share ownership, such as a current brokerage statement, and photo identification. Only shareholdersShareholders, or their valid proxy holders may addressthat contain derogatory references to individuals, use offensive language, or are otherwise out of order or not suitable for the meeting. Please note that cameras, camcorders, videotaping equipment and other recording devices, and large packages, banners, placards and signsconduct of the Annual Meeting of Shareholders, will not be permittedaddressed during the meeting.
If you wish to submit a question in advance of the Annual Meeting, you may visit www.proxyvote.com and enter your 16-digit control number, and you will be able to pre-submit such question until May 2, 2024. If you wish to submit a question during the meeting, log in to the virtual meeting website at www.virtualshareholdermeeting.com/AXP2024 using the 16-digit control number included on your notice, on your proxy card or in the meeting.voting instructions that accompanied your proxy materials, select the Q&A icon, type the question into the “Submit a Question” field and click “Submit.” As was the case at our in-person meetings, each shareholder will be limited to two questions so as to allow us to respond to as many shareholder questions as possible. Questions that are substantially similar may be grouped and answered once to avoid repetition. We ask that all shareholders provide their name and contact details when submitting a question through the virtual meeting website so that we may address any individual concerns or follow up matters directly. If a question posed at the Annual Meeting of Shareholders was not otherwise answered, we encourage you to contact us separately after the meeting by visiting http://ir.americanexpress.com. 
2024 PROXY STATEMENT 115 • Technical Assistance Beginning 15 minutes prior to the start of and during the Annual Meeting of Shareholders, we will have a support team ready to assist shareholders with any technical difficulties they may have accessing or hearing the virtual meeting. If you encounter any difficulties accessing the virtual meeting during the check-in or meeting time, you should call the support team listed on the virtual meeting website at www.virtualshareholdermeeting.com/AXP2024. Street Name Holders If your shares are held in a bank, brokerage or other institutional account, you are a beneficial owner of these shares but not the record holder. This is known as holding shares in “street name.” If you wish to vote thesethe shares you hold in person“street name” at the meeting, you must obtain a valid legal proxy from your bank, broker or other intermediaryintermediary. Audio and bring it with youReplay The meeting will be accessible to hand in with your ballot. Webcast
You can access a livethe general public through the American Express Investor Relations website at http://ir.americanexpress.com. An audio webcast and a replay ofwill be available after the meeting on our investorat the same website athttp://ir.americanexpress.com.address.
Vote Confirmation You may confirm your vote was cast in accordance with your instructions. Beginning April 23, 2018,22, 2024, and for up to two months60 days after the annual meeting,Annual Meeting, you may confirm your vote beginning 24 hours after your vote is received, whether it was cast by proxy card, electronically or telephonically. To obtain vote confirmation, log ontoon to proxyvote.com using your control number (included on your notice, on your proxy card or in the instructions that accompanied your proxy materials) and receive confirmation on how your vote was cast. If you hold your shares through a bank or brokerage account, the ability to confirm your vote may be affected by the rules of your bank or broker, and the confirmation will not confirm whether your bank or broker allocated the correct number of shares to you. Additional Matters
Mr. Peter Lindner, a former employee of the Company who has pursued a number of personal grievances against the Company since his employment was terminated in 1998, has submitted a shareholder proposal under the Company’s by-laws relating to, among other things, his termination of employment and his grievances against the Company (Lindner Proposal). Mr. Lindner has notified the Company that he intends to present the Lindner Proposal at this year’s annual meeting and nominate himself for election to the Board at this year’s annual meeting (Lindner Nomination).
The Board’s designated proxyholders have discretionary authority to vote the proxies solicited by the Company on the Lindner Proposal. If the Lindner Proposal is properly presented at the annual meeting, the Board’s designated proxyholders intend to exercise their discretion to vote “AGAINST” the Lindner Proposal.
Participants in the Solicitation
Under applicable SEC Regulations, members of the Board, the Board’s nominees, and certain officers and employees of the Company are “participants” with respect to the Company’s solicitation of proxies in connection with the annual meeting. Certain information concerning these “participants” is set forth in this Proxy Statement and Annex A hereto.
Solicitation of Proxies; Expenses We are providing this proxy statementProxy Statement to you in connection with the solicitation of proxies by our Board for the 2018 annual meeting2024 Annual Meeting of Shareholders, including any adjournment or postponement of the meeting.
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Other Information 2018 Proxy Statement
We will pay the expenses of soliciting proxies on behalf of the Board. Our directors, officers or employees may solicit proxies for us in person or by mail, telephone, facsimile or electronic transmission. As a result of the Lindner Proposal and the Lindner Nomination, we will incur additional costs in connection with our solicitation of proxies. We have hired Morrow Sodali LLC, 470 West Avenue,333 Ludlow Street, 5th Floor, South Tower, Stamford, CT 06902, to help us distribute and solicit proxies. We will pay them $19,000.00$22,000 plus expenses for these services. Proxies may be solicited by mail, telephone, facsimile, telegraph, the Internet, e-mail, newspapers and other publications of general distribution and in person. If Mr. Lindner commences an actual solicitation of proxies, Morrow Sodali expects that approximately ten of its employees would assist in the solicitation. Our expenses related to the solicitation of proxies from shareholders this year will exceed those normally spent for an annual meeting of shareholders. Such additional costs are estimated to aggregate to approximately $100,000.00. These additional solicitation costs are expected primarily to include the increased fees of outside counsel. To date, we have incurred substantially all of these additional solicitation costs. Notice of Business to Come Before the Meeting Our Board and the Company’s managementManagement have not received notice of, and are not aware of, any business to come before the annual meetingAnnual Meeting other than the agenda items referred to in this Proxy StatementStatement. If any other matter comes before the meeting, the named proxies will use their best judgment in voting the proxies. Additional Voting Information Voting at the Annual Meeting Shares represented by valid proxies or voting instruction forms that are received on time will be voted as specified. If you sign and return your proxy card or voting instruction form but do not indicate specific choices, your shares will be voted as our Board recommends. The way you vote your shares prior to the submissionmeeting will not limit your right to change your vote at the virtual Annual Meeting. Shareholders who wish to vote at the virtual Annual Meeting may do so by visiting www.virtualshareholdermeeting.com/AXP2024, entering their 16-digit control number and following the on-screen instructions.
• 116 2024 PROXY STATEMENT If the Annual Meeting is adjourned or postponed, your proxy will still be effective and you will be able to change or revoke your proxy until the rescheduled Annual Meeting. Record Date You may vote all common shares that you owned as of the Lindner Proposal. Adoptionclose of business on March 8, 2024, the record date for the meeting. On the record date, we had 720,038,626 common shares outstanding and entitled to vote. Each common share is entitled to one vote on each matter properly brought before the meeting. Ownership of Shares You may own common shares in one or more of the Lindner Proposal,following ways: | ¾ | | Directly in your name as the shareholder of record, including shares purchased through the Computershare Investment Plan, our transfer agent’s stock purchase plan, or restricted stock awards issued to employees under our long-term incentive plans. |
| ¾ | | If your shares are registered directly in your name, you are the holder of record of these shares and we are sending proxy materials directly to you. As the holder of record, you have the right to give your proxy directly to our tabulating agent. |
| ¾ | | Indirectly through a broker, bank or other intermediary in street name. |
| ¾ | | If you hold your shares in street name, your broker, bank or other intermediary is sending proxy materials to you and you may direct them how to vote on your behalf by completing the voting instruction form that accompanies your proxy materials or following the instructions in the notice you received. |
| ¾ | | Indirectly through the American Express Company Stock Fund of our RSP or the Employee Stock Ownership Plan (ESOP) of Amex Canada, Inc. and Amex Bank of Canada. |
| ¾ | | If you participate in the Computershare Investment Plan, which is the stock purchase plan administered by Computershare, the Company’s transfer agent, your proxy includes the number of shares enrolled in that plan as well as any shares you have acquired through dividend reinvestment. If you participate in the RSP or ESOP, your proxy includes shares that the relevant plan has credited to your account. |
| ¾ | | To allow sufficient time for the RSP and the ESOP trustees to vote, the trustees must receive your voting instructions by 11:59 p.m. Eastern Time on May 1, 2024. If the trustees for the RSP and the ESOP do not receive your instructions by that date, the trustees will not vote your shares. |
How to Cast Your Vote You may vote common shares that you owned as of the close of business on March 8, 2024, which is the record date for the Annual Meeting. We encourage you to vote as soon as possible, even if properly presented,you plan to attend the meeting. Please follow the instructions on your proxy card, voting instruction form or on the notice of internet availability of proxy materials that you received. If you submit your vote prior to the meeting, you may still attend the meeting and vote at the meeting. You may vote in the following ways: | | | | | | | | | BY TELEPHONE You can vote by calling the number on your proxy card or voting instruction form or provided on the website listed on your notice. | | | | BY MAIL If you received written materials, you can vote by mail by marking, dating and signing your proxy card or voting instruction form and returning it in the envelope provided. | | | | DURING THE MEETING You can vote at the virtual Annual Meeting at www.virtualshareholdermeeting.com /AXP2024 by using the 16-digit control number included on your notice, on your proxy card, or in the voting instructions that accompanied your proxy materials. | ONLINE You can vote online at proxyvote.com. | | | | |
For voting via telephone, online and at the virtual Annual Meeting, you will need the 16-digit control number included on your notice, on your proxy card or in the voting instructions that accompanied your proxy materials. Telephone and online voting are available through 11:59 p.m. Eastern Time on May 1, 2024, for shares held in employee plans, and through 11:59 p.m. Eastern Time on May 5, 2024, for all other shares.
2024 PROXY STATEMENT 117 • Confidential Voting We maintain the confidentiality of the votes of individual shareholders. Your vote will not be disclosed unless the law requires disclosure, you authorize disclosure or your vote is cast in a contested election. If you write comments on your proxy card, Management may learn how you voted in reviewing your comments. In addition, the approvalInspectors of Election and selected employees of our independent tabulating agent may have access to individual votes in the normal course of counting and verifying the vote. Effect of Not Casting Your Vote If you hold your shares in street name, you must instruct your bank, broker or other nominee how to vote your shares. Under NYSE rules, brokers are permitted to exercise discretionary voting authority on “routine” matters when voting instructions have not been received from a beneficial owner ten days prior to the Annual Meeting of Shareholders. The only “routine” item on this year’s Annual Meeting Agenda is Item 2 (Ratification of Appointment of the Company’s Independent Registered Public Accounting Firm). Therefore, if you hold your shares in street name and you wish to have your shares voted on all items in this Proxy Statement, please return your voting instruction form or cast your instructions by telephone or online. Otherwise, your shares will not be voted on any items with the exception that your broker may vote in its discretion on Item 2. Revocation of Proxies You can revoke your proxy at any time before your shares are voted if you: | ¾ | | Submit a written revocation to our Company’s Corporate Secretary and Chief Governance Officer; |
| ¾ | | Submit a later-dated proxy; |
| ¾ | | Provide subsequent telephone or online voting instructions; or |
| ¾ | | Attend and vote at the virtual Annual Meeting (however, attending the virtual Annual Meeting alone will not revoke your previous proxy). |
If you hold your shares in street name, please follow the directions provided to you by your bank, broker or other intermediary to change or revoke any voting instructions you have already provided. Quorum and Required Vote We will have a quorum and will be able to conduct the business of the Annual Meeting if the holders of a majority of the votes cast.that shareholders are entitled to cast are present at the meeting, either virtually by logging in to the virtual meeting website using your 16-digit control number, or by proxy. Virtual attendance at the Annual Meeting, abstentions and broker non-votes are counted as present for purposes of a determining whether there is a quorum. For the 2024 Annual Meeting of Shareholders, to elect directors and adopt the other proposals, the following votes are required under our governing documents and New York State law: | | | | | | | | | | | Item | | Vote Required | | Do abstentions
count as
votes cast? | | Is broker discretionary voting allowed?* | | | | | Election of directors | | Approval of the majority of the votes cast | | No | | No | | | | | Ratification of appointment of independent registered public accounting firm | | Approval of the majority of the votes cast | | No | | Yes | | | | | Advisory resolution to approve executive compensation** | | Approval of the majority of the votes cast | | No | | No | | | | | Approval of the Second Amended and Restated American Express Company 2016 Incentive Compensation Plan | | Approval of the majority of the votes cast | | Yes*** | | No | | | | | Shareholder proposals** | | Approval of the majority of the votes cast | | No | | No |
| * | A broker non-vote occurs when a broker submits a proxy but does not vote for an item because it is not a “routine” item and the broker has not received voting instructions from the beneficial owner. As described under “Effect of Not Casting Your Vote,” your broker may vote in its discretion only on Item 2, Ratification of Appointment of the Company’s Independent Registered Public Accounting Firm. |
| *** | Under NYSE rules for shareholder approval of equity compensation plans, abstentions are counted as votes cast and will have the effect of votes cast against the approval of the Second Amended and Restated American Express Company 2016 Incentive Compensation Plan. |
• 118 2024 PROXY STATEMENT There are no cumulative voting rights. Abstentions and broker non-votes are not considered as votes cast and will have no effect on the outcome of the vote on any of the Lindner Proposal.proposals, with the exception of the proposal to approve the Second Amended and Restated American Express Company 2016 Incentive Compensation Plan. If any other matter comes before the meeting, the named proxies will use their best judgment in voting the proxies. 2018Multiple Shareholders Sharing the Same Address
We are sending only one notice or one Proxy Statement and Annual Report to the address of multiple shareholders unless we have received contrary instructions from any shareholder at that address. This practice, known as “householding,” reduces duplicate mailings, saving paper and reducing printing costs. If any shareholder residing at such an address wishes to receive an individual copy of the materials, or if you are receiving multiple copies of our Proxy Statement and Annual Report and would like to enroll in this service, please contact the Company’s Corporate Secretary and Chief Governance Officer (see page 119 for contact information). 2025 Annual Meeting of Shareholders Information Shareholder Proposals for Inclusion in Next Year’sthe 2025 Proxy Statement To be considered for inclusion in next year’s proxy statement,Proxy Statement, any shareholder proposals submitted in accordance with SEC Rule 14a-8 must be received by our Corporate Secretary and Chief Governance Officer at our principal executive offices no later than November 19, 2018.15, 2024. Any such proposals must comply with all of the requirements of SEC Rule 14a-8. Other Shareholder Proposals for Presentation at Next Year’sthe 2025 Annual Meeting Under our by-laws,bylaws, shareholders must follow certain advance notice procedures to nominate a person for election as a director at an annual or special meeting, or to introduce an item of business at an annual meeting. Under these advance notice procedures, shareholders must submit the proposed nominee or item of business by delivering a notice to the Corporate Secretary and Chief Governance Officer at our principal executive offices. We must receive notice as follows: ●¾ | | If it is a shareholder’s intention to introduce a nomination or proposed item of business for an annual meeting, we must receive notice not less than 90 days nor more than 120 days before the first anniversary of the prior year’s meeting. Assuming that the 20182024 Annual Meeting of Shareholders is held on schedule, we must receive notice pertaining to the 20192025 Annual Meeting of Shareholders no earlier than January 7, 20196, 2025 and no later than February 6, 2019.5, 2025. |
●¾ | However, | Alternatively, if we hold the 20182024 Annual Meeting of Shareholders on a date that is not within 25 days before or after such anniversary date, we must receive the notice no later than ten days after the earlier of the date we first provide notice of the meeting to shareholders or announce it publicly. |
●¾ | | If we hold a special meeting to elect directors, we must receive a shareholder’s notice of intention to introduce a nomination no later than ten days after the earlier of the date we first provide notice of the meeting to shareholders or announce it publicly. |
Any shareholder intending to include a director nominee in the Company’s proxy materials at the 2025 Annual Meeting pursuant to Article III, Section 3.12 of our bylaws (i.e., proxy access) should review the requirements for using proxy access as described in such section. The Company’s Corporate Secretary and Chief Governance Officer must receive a shareholder’s nomination, with all required information, between October 16, 2024 and the close of business on November 15, 2024. Our by-lawsbylaws provide that notice of a proposed nomination must include certain information about the shareholder and the nominee, as well as a written consent of the proposed nominee to serve if elected. A notice of a proposed item of business must include a description of and the reasons for bringing the proposed business to the meeting, any material interest of the shareholder in the business and certain other information about the shareholder. Any notice (other than a proposal pursuant to Rule 14a-8) that is received outside of the window specified above for proposed items of business will be considered untimely under Rule 14a-4(c) under the Securities Exchange Act of 1934. The persons named in the proxy for the meeting may exercise their discretionary voting power with respect to all such matters, including voting against them. | To comply with universal proxy rules, shareholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must comply with and provide the information required by the Company’s bylaws and by Rule 14a-19 under the Securities Exchange Act of 1934 to the Company’s Corporate Secretary and Chief Governance Officer (see below for contact information) no earlier than January 6, 2025 and no later than February 5, 2025, assuming that the 2024 Annual Meeting of Shareholders is held on schedule.
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2018 Proxy Statement Other Information2024 PROXY STATEMENT 119 •
All director nominations and shareholder proposals, other than shareholder proposals made pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, must comply with the requirements of the Company’s by-laws.bylaws. You may obtain a copy of the Company’s by-lawsbylaws at no cost from the Company’s Corporate Secretary (seepage 100 for contact information). Additional Voting Information
Voting at the Annual Meeting
Shares represented by valid proxies or voting instruction forms that are received on time will be voted as specified. If you sign and return your proxy card or voting instruction form but do not indicate specific choices, your shares will be voted as our Board recommends. The way you vote your shares prior to the meeting will not limit your right to change your vote at the meeting if you attend in person and vote by ballot.
Street Name Holders
If you hold shares in street name and you want to vote in person at the meeting, you must obtain a proxy from the record holder of your shares as of the close of business on the record date indicating that you were beneficial owner of these shares as of the record date, as well as the number of shares of which you were the beneficial owner, and appointing you as the record holder’s proxy to vote these shares. You should contact your bank, broker or other intermediary through which you hold your shares for instructions on how to obtain a proxy.
Record Date
You may vote all common shares that you owned as of the close of business on March 9, 2018, the record date for the meeting. On the record date, we had 860,144,667 common shares outstanding and entitled to vote. Each common share is entitled to one vote on each matter properly brought before the meeting.
Ownership of Shares
You may own common shares in one or more of the following ways:
● | Directly in your name as the shareholder of record, including shares purchased through the Computershare Investment Plan, our transfer agent’s stock purchase plan, or restricted stock awards issued to employees under our long-term incentive plans | ● | Indirectly through a broker, bank or other intermediary in “street name” | ● | Indirectly through the American Express Company Stock Fund of our RSP or the Employee Stock Ownership Plan (ESOP) of Amex Canada, Inc. and Amex Bank of Canada |
If your shares are registered directly in your name, you are the holder of record of these shares and we are sending proxy materials directly to you. As the holder of record, you have the right to give your proxy directly to our tabulating agent. If you hold your shares in street name, your broker, bank or other intermediary is sending proxy materials to you and you may direct them how to vote on your behalf by completing the voting instruction form that accompanies your proxy materials or following the instructions in the notice you received.
Shares Held Under Plans
If you participate in the Computershare Investment Plan, which is the stock purchase plan administered by Computershare, the Company’s transfer agent, your proxy includes the number of shares enrolled in that plan as well as any shares you have acquired through dividend reinvestment. If you participate in the RSP or ESOP, your proxy includes shares that the relevant plan has credited to your account.
To allow sufficient time for the RSP and the ESOP trustees to vote, the trustees must receive your voting instructions by 3:00 p.m. Eastern Time on May 2, 2018. If the trustees for the RSP and the ESOP do not receive your instructions by that date, the trustees will not vote your shares.
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Other Information 2018 Proxy Statement
How to Cast Your Vote
You may vote common shares that you owned as of the close of business on March 9, 2018, which is the record date for the meeting. We encourage you to vote as soon as possible, even if you plan to attend the meeting in person. Please follow the instructions on your proxy card, voting instruction form or on the notice of internet availability of proxy materials that you received. If you submit your vote prior to the meeting, you may still attend and vote at the meeting.
You may vote in the following ways:
By Telephone | | You can vote by calling the number on your proxy card or voting instruction form or provided on the website listed on your notice. | Online | | You can vote online at proxyvote.com. | By Mail | | If you received written materials, you can vote by mail by marking, dating and signing your proxy card or voting instruction form and returning it in the envelope provided. | In Person | | You can vote in person at the annual meeting. If you hold your shares in street name, you must obtain a proxy from the record holder to vote in person. |
For telephone and online voting, you will need the 16-digit control number included on your notice, on your proxy card or in the voting instructions that accompanied your proxy materials. Telephone and online voting are available through 3:00 p.m. Eastern Time on May 2, 2018, for shares held in employee plans, and through 11:59 p.m. Eastern Time on Sunday, May 6, 2018, for all other shares.
Confidential Voting
We maintain the confidentiality of the votes of individual shareholders. Your vote will not be disclosed unless the law requires disclosure, you authorize disclosure or your vote is cast in a contested election. If you write comments on your proxy card or ballot, management may learn how you voted in reviewing your comments. In addition, the Inspectors of Election and selected employees of our independent tabulating agent may have access to individual votes in the normal course of counting and verifying the vote.
Effect of Not Casting Your Vote
If you hold your shares in street name, you must instruct your bank, broker or other nominee how to vote your shares. Under NYSE rules, brokers are permitted to exercise discretionary voting authority on “routine” matters when voting instructions have not been received from a beneficial owner ten days prior to the shareholder meeting. The only “routine” item on this year’s annual meeting agenda is Item 2 (Ratification of the Company’s independent registered public accounting firm).
If you hold your shares in street name and you wish to have your shares voted on all items in this proxy statement, please return your voting instruction form or cast your instructions by telephone or online. Otherwise, your shares will not be voted on any items with the exception that your broker may vote in its discretion on Item 2.
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Revocation of Proxies
You can revoke your proxy at any time before your shares are voted if you:
● | Submit a written revocation to our Company’s Corporate Secretary; | ● | Submit a later-dated proxy; | ● | Provide subsequent telephone or online voting instructions or; | ● | Vote in person at the meeting. |
If you hold your shares in street name, please follow the directions provided to you by your bank, broker or other intermediary to change or revoke any voting instructions you have already provided.
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2018 Proxy Statement Other Information
Quorum and Required Vote
We will have a quorum and will be able to conduct the business of the annual meeting if the holders of a majority of the votes that shareholders are entitled to cast are present at the meeting, either in person or by proxy. For the 2018 annual meeting, to elect directors and adopt the other proposals, the following votes are required under our governing documents and New York State law:
Item | | Vote Required | | Do abstentions
count as
votes cast? | | Is broker
discretionary
voting allowed?* | Election of directors | | Plurality of the votes cast | | No | | No | Ratification of appointment of independent
registered public accounting firm | | Approval of the majority
of the votes cast | | No | | Yes | Advisory resolution to approve
executive compensation** | | Approval of the majority
of the votes cast | | No | | No | Shareholder proposals** | | Approval of the majority
of the votes cast | | No | | No |
* | A broker non-vote occurs when a broker submits a proxy but does not vote for an item because it is not a “routine” item and the broker has not received voting instructions from the beneficial owner. As described under Effect of Not Casting Your Vote, your broker may vote in its discretion only on Item 2, Ratification of appointment of the Company’s independent registered public accounting firm.
| ** | Advisory/Non-binding
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There are no cumulative voting rights. Abstentions and broker non-votes are not considered as votes cast and will have no effect on the outcome of the vote on any of the proposals. If any other matter comes before the meeting, the named proxies will use their best judgment in voting the proxies.
Multiple Shareholders Sharing the Same Address
We are sending only one notice or one proxy statement and annual report to the address of multiple shareholders unless we have received contrary instructions from any shareholder at that address. This practice, known as “householding,” reduces duplicate mailings, saving paper and reducing printing costs. If any shareholder residing at such an address wishes to receive an individual copy of the materials, or if you are receiving multiple copies of our proxy statement and annual report and would like to enroll in this service, please contact the Company’s Corporate SecretaryChief Governance Officer (see below for contact information).
Availability of Form 10-K2023 Annual Report If you would like a paper copy of our 20172023 Annual Report on Form 10-K, excluding certain exhibits, please contact Tangela S. Richter,Kristina V. Fink, Corporate Secretary and Chief Governance Officer, American Express Company, 200 Vesey Street, New York, New York 10285, or by telephoneemail at 212-640-2000.  STEPHEN J. SQUERIcorporatesecretarysoffice@aexp.com.
Chairman and CEO
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Annex A–Additional Information Regarding Participants in the Solicitation• 120 2024 PROXY STATEMENT
Under applicable SEC rules and regulations, members of the Board, the Board’s nominees, and certain officers and other employees of the Company are “participants” with respect to the Company’s solicitation of proxies in connection with the annual meeting. The following sets forth certain information about the persons who are “participants.”
Directors and Nominees
The following table sets forth the names and business addresses of the Company’s directors (each of whom is also a current nominee for director with the exception of Ms. Burns and Messrs. Chenault and Walter), as well as the names and principal business addresses of the corporation or other organization in which the principal occupations or employment of the directors is carried on. The principal occupations or employment of the Company’s directors are set forth under the heading “Item 1: Election of Directors” in the Proxy Statement.
Name | Business Name and Address | Charlene Barshefsky | WilmerHale | | 1875 Pennsylvania Ave., NW | | Washington, D.C. 20006 | John J. Brennan | Vanguard | | 400 Devon Park Drive | | Wayne, PA 19087 | Ursula M. Burns | Veon | | Claude Debussylaan 88 | | 1082 MD Amsterdam | | The Netherlands | Kenneth I. Chenault | American Express Company | | 200 Vesey Street | | New York, NY 10285 | Peter Chernin | The Chernin Group | | 12180 Millennium Drive, Suite 500 | | Playa Vista, CA 90094 | Ralph de la Vega | American Express Company | | 200 Vesey Street | | New York, NY 10285 | | c/o Kristina Fink | Anne Lauvergeon | A.L.P. SAS | | 13 rue du Docteur Lancereaux | | 75008 Paris, France | Michael O. Leavitt | Leavitt Partners, LLC | | 299 South Main St., Suite 2300 | | Salt Lake City, UT 84111 | Theodore J. Leonsis | Monumental Sports and Entertainment | | Verizon Center | | 601 F Street, NW 3rdFloor | | Washington, DC 2004 | Richard C. Levin | Coursera | | 381 E. Evelyn Avenue | | Mountain View, CA 94041 | Samuel J. Palmisano | 301 Merritt 7 | | Norwalk, CT 06851 | Stephen J. Squeri | American Express Company | | 200 Vesey Street | | New York, NY 10285 |
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2018 Proxy Statement Annex A—Additional Information Regarding Participants in the Solicitation
Name | Business Name and Address | Daniel L. Vasella | Novartis | | 14 P.O. Box | | 6343 Rotkreuz/Risch Switzerland | Robert D. Walter | The Robert D. Walter Company | | 330 West Spring Street, Suite 400 | | Columbus, OH 43215 | Ronald A. Williams | RW2 Enterprises, LLC | | 2255 Glades Road, Suite 324A | | Boca Raton, FL 33431 | Christopher D. Young | 2821 Mission College Blvd. | | Santa Clara, CA 95054 |
Certain Officers and Other Employees
The following table sets forth the name and principal occupation of the Company’s officers and employees who are “participants.” The principal occupation refers to such person’s position with the Company, and the principal business address of each such person is c/o American Express Company, 200 Vesey Street, New York, New York 10285.
Name | Principal Occupation | Tangela S. Richter | Corporate Secretary and Chief Governance Officer* | Carol V. Schwartz | Former Corporate Secretary* | Sherwood Willard | Head of Investor Relations |
* | Ms. Richter succeeded Ms. Schwartz as the Company’s Corporate Secretary on October 1, 2017. |
Information Regarding Ownership of the Company’s Securities by Participants
Except as described in this Annex A or in the proxy statement, none of the persons listed above under “Directors and Nominees” or “Certain Officers and Other Employees” owns any Company securities of record that they do not own beneficially. The number of Company securities beneficially owned by directors and NEOs as of March 13, 2018 is set forth under the heading “Stock Ownership Information” in the proxy statement. The number of Company securities beneficially owned by the Company’s other officers and employees who are “participants” as of March 13, 2018 is set forth below.
Name | Company’s Securities Owned | Tangela S. Richter | 0 | Carol V. Schwartz | 8,635 | Sherwood Willard | 932 |
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Annex A—Additional Information Regarding Participants in the Solicitation2018 Proxy Statement
Information Regarding Transactions in the Company’s Securities by Participants
The following table sets forth purchases and sales of the Company’s securities during the past two years by the persons listed above under “Directors and Nominees” and “Certain Officers and Other Employees.” None of the purchase price or market value of the securities listed below is represented by funds borrowed or otherwise obtained for the purpose of acquiring or holding such securities.
Company’s Securities Purchased or Sold (February 1, 2016 through March 13, 2018)
| Name | | Date | | Number of Shares and Units
in Company’s Securities
Acquired or (Disposed of) | | Notes | | Charlene Barshefsky | | — | | — | | | — | | | John J. Brennan | | 2/22/17 | | 4,000 | | | (1 | ) | | Ursula M. Burns | | 12/14/17 | | (4,000 | ) | | (4 | ) | | Kenneth I. Chenault | | 3/31/2016 | | 92 | | | (8 | ) | | | 5/19/2016 | | 625,000 | | | (2 | ) | | | 5/19/2016 | | 257,813 | | | (2 | ) | | | 5/19/2016 | | (838,968 | ) | | (3 | ) | | | 6/30/2016 | | 75 | | | (8 | ) | | | 8/16/2016 | | (16,000 | ) | | (4 | ) | | | 9/30/2016 | | 75 | | | (8 | ) | | | 12/31/2016 | | 77 | | | (8 | ) | | | 1/26/2017 | | (63,148 | ) | | (5 | ) | | | 1/26/2017 | | 63,149 | | | (6 | ) | | | 1/26/2017 | | (33,349 | ) | | (7 | ) | | | 1/28/2017 | | 78,361 | | | (6 | ) | | | 1/28/2017 | | 78,361 | | | (6 | ) | | | 1/28/2017 | | (43,742 | ) | | (7 | ) | | | 3/31/2017 | | 69 | | | (8 | ) | | | 6/13/2017 | | (22,000 | ) | | (4 | ) | | | 6/30/2017 | | 69 | | | (8 | ) | | | 7/24/2017 | | 960,000 | | | (2 | ) | | | 7/24/2017 | | (484,257 | ) | | (3 | ) | | | 7/24/2017 | | (305,246 | ) | | (3 | ) | | | 9/30/2017 | | 65 | | | (8 | ) | | | 12/14/2017 | | 118,000 | | | (2 | ) | | | 12/14/2017 | | (96,440 | ) | | (3 | ) | | | 12/14/2017 | | (5,087 | ) | | (4 | ) | | | 12/31/2017 | | 65 | | | (8 | ) | | | 1/24/2018 | | (19,856 | ) | | (5 | ) | | | 1/24/2018 | | 19,857 | | | (6 | ) | | | 1/24/2018 | | (9,035 | ) | | (7 | ) | | | 1/26/2018 | | 87,777 | | | (6 | ) | | | 1/26/2018 | | 87,777 | | | (6 | ) | | | 1/26/2018 | | (46,715 | ) | | (7 | ) | | Peter Chernin | | — | | — | | | — | | | Ralph de la Vega | | — | | — | | | — | | | Anne Lauvergeon | | — | | — | | | — | | | Michael O. Leavitt | | — | | — | | | — | | | Theodore J. Leonsis | | — | | — | | | — | | | Richard C. Levin | | — | | — | | | — | | | Samuel J. Palmisano | | — | | — | | | — | |
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2018 Proxy Statement Annex A—Additional Information Regarding Participants in the Solicitation
| Name | | Date | | Number of Shares and Units
in Company’s Securities
Acquired or (Disposed of) | | Notes | | Stephen J. Squeri | | 2/10/2016 | | 140 | | | (9 | ) | | | 3/31/2016 | | 33 | | | (8 | ) | | | 5/10/2016 | | 116 | | | (9 | ) | | | 6/30/2016 | | 33 | | | (8 | ) | | | 8/10/2016 | | 114 | | | (9 | ) | | | 9/30/2016 | | 33 | | | (8 | ) | | | 11/10/2016 | | 120 | | | (9 | ) | | | 12/7/2016 | | 39,370 | | | (2 | ) | | | 12/7/2016 | | (34,755 | ) | | (3 | ) | | | 12/31/2016 | | 37 | | | (8 | ) | | | 1/26/2016 | | 15,006 | | | (6 | ) | | | 1/26/2016 | | (5,893 | ) | | (7 | ) | | | 1/28/2017 | | 26,260 | | | (6 | ) | | | 1/28/2017 | | 26,260 | | | (6 | ) | | | 1/28/2017 | | (13,616 | ) | | (7 | ) | | | 2/10/2017 | | 107 | | | (9 | ) | | | 3/31/2017 | | 37 | | | (8 | ) | | | 5/10/2017 | | 107 | | | (9 | ) | | | 6/30/2017 | | 37 | | | (8 | ) | | | 7/25/2017 | | 32,965 | | | (2 | ) | | | 7/25/2017 | | 37,486 | | | (2 | ) | | | 7/25/2017 | | (62,792 | ) | | (3 | ) | | | 7/25/2017 | | (32,000 | ) | | (3 | ) | | | 8/10/2017 | | 98 | | | (9 | ) | | | 9/30/2017 | | 37 | | | (8 | ) | | | 11/10/2017 | | 98 | | | (9 | ) | | | 12/31/2017 | | 41 | | | (8 | ) | | | 1/26/2018 | | (5,000 | ) | | (4 | ) | | | 1/26/2018 | | 27,777 | | | (6 | ) | | | 1/26/2018 | | 27,777 | | | (6 | ) | | | 1/26/2018 | | (12,178 | ) | | (7 | ) | | | 2/9/2018 | | 103 | | | (9 | ) | | Daniel L. Vasella | | — | | — | | | — | | | Robert D. Walter | | — | | — | | | — | | | Ronald A. Williams | | — | | — | | | — | | | Christopher D. Young | | — | | — | | | — | | | Tangela S. Richter | | 10/31/2017 | | 1,129 | | | (6 | ) | | | 10/31/2017 | | (466 | ) | | (7 | ) | | | 11/2/2017 | | (663 | ) | | (3 | ) | | Carol V. Schwartz | | 1/28/2017 | | 1,155 | | | (6 | ) | | | 1/28/2017 | | (221 | ) | | (7 | ) | | | 1/26/2018 | | 1,591 | | | (6 | ) | | | 1/26/2018 | | (657 | ) | | (7 | ) | | Sherwood Willard | | 5/12/2016 | | 4,210 | | | (2 | ) | | | 5/12/2016 | | (4,210 | ) | | (3 | ) | | | 5/12/2016 | | 1,247 | | | (2 | ) | | | 5/12/2016 | | (1,247 | ) | | (3 | ) | | | 1/28/2017 | | 1,530 | | | (6 | ) | | | 1/28/2017 | | (702 | ) | | (7 | ) | | | 7/31/2017 | | 2,540 | | | (2 | ) | | | 7/31/2016 | | (2,540 | ) | | (3 | ) | | | 1/26/2018 | | 1,591 | | | (6 | ) | | | 1/26/2018 | | (659 | ) | | (7 | ) | | | 1/29/2018 | | 559 | | | (2 | ) | | | 1/29/2018 | | (559 | ) | | (3 | ) | | | 1/29/2018 | | (828 | ) | | (3 | ) | | | 1/31/2018 | | 2,396 | | | (6 | ) | | | 1/31/2018 | | (916 | ) | | (7 | ) | | | 3/9/2018 | | (1480 | ) | | (3 | ) |
Table of Contents
Annex A—Additional Information Regarding Participants in the Solicitation2018 Proxy Statement
(1) | Open market acquisition
| (2) | Exercise of Nonqualified Options
| (3) | Open market sale
| (4) | Gift of shares
| (5) | Vesting of Restricted Stock Awards (RSAs) or RSUs paid out in cash
| (6) | Vesting of RSAs, RSUs or Restricted Stock Options
| (7) | Shares withheld as payment of taxes or costs upon conversion, vesting, or exercise of RSAs, RSUs or Nonqualified Options
| (8) | Represents estimated quarterly increase (decrease) of units held in the participant’s RSP
| (9) | Shares acquired pursuant to dividend reinvestment between February 10, 2016 and February 9, 2018
|
Miscellaneous Information Concerning Participants
Except as described in this Annex A or in the proxy statement, neither any participant nor any of their respective associates or affiliates (together, the Participant Affiliates) is either a party to any transaction or series of transactions since January 1, 2017 or has knowledge of any current proposed transaction or series of proposed transactions (i) to which the Company or any of its subsidiaries was or is to be a participant, (ii) in which the amount involved exceeds $120,000 and (iii) in which any participant or Participant Affiliate had, or will have, a direct or indirect material interest. Furthermore, except as described in this Annex A or in the proxy statement, (a) no participant or Participant Affiliate, directly or indirectly, beneficially owns any securities of the Company or any securities of any subsidiary of the Company, and (b) no participant owns any securities of the Company of record but not beneficially.
Except as described in this Annex A or in the proxy statement, no participant or Participant Affiliate has entered into any agreement or understanding with any person with respect to any future employment by the Company or any of its affiliates or any future transactions to which the Company or any of its affiliates will or may be a party.
Except as described in this Annex A or in the proxy statement, there are no contracts, arrangements or understandings by any participant or Participant Affiliate since January 1, 2017 with any person with respect to any securities of the Company, including, but not limited to, joint ventures, loan or option arrangements, puts or calls, guarantees against loss or guarantees of profit, division of losses or profits, or the giving or withholding of proxies.
Except as described in this Annex A or in the proxy statement, and excluding any director or executive officer of the Company acting solely in that capacity, no person who is a party to an arrangement or understanding pursuant to which a nominee for election as director is proposed to be elected has any substantial interest, direct or indirect, by security holdings or otherwise, in any matter to be acted upon at the annual meeting.
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Annex B—Information Regarding Non-GAAP
Financial Measures
(Millions, except percentages and per share amounts)
The tables below provide further information regarding adjusted amounts included in this proxy statement and reconciliations to GAAP measures.
| Adjusted Total Revenues Net of Interest Expense ($ in millions) | | 2016 | | 2017 | | GAAP Total Revenues Net of Interest Expense | | $ | 32,119 | | | $ | 33,471 | | Estimated Costco-Related Revenues(a) | | ($ | 1,193 | ) | | | | | Adjusted Total Revenues Net of Interest Expense | | $ | 30,926 | | | $ | 33,471 | | FX-adjusted Adjusted Total Revenues Net of Interest Expense(b) | | $ | 30,996 | | | | | | | | | | | | | | | YoY% Increase/(Decrease) in Total Revenues Net of Interest Expense | | | | | | | 4% | | YoY% Increase/(Decrease) in Adjusted Total Revenues Net of Interest | | | | | | | 8% | | YoY% Increase/(Decrease) in FX-adjusted Adjusted Total Revenues Net of Interest Expense | | | | | | | 8% |
| Adjusted Return on Equity for Tax Act Impacts ($ in millions) | | 2017 | | GAAP Net Income for the twelve months ended December 31 | | $ | 2,736 | | 2017 Tax Act Impacts(c) | | $ | 2,595 | | Adjusted Net Income | | $ | 5,330 | | Average Shareholders’ Equity | | $ | 20,820 | | 2017 Tax Act Impacts(c) | | $ | 199 | | Adjusted Average Shareholders’ Equity | | $ | 21,019 | | Return on Average Equity | | | 13.1% | | Adjusted Return on Average Equity | | | 25.4% |
| Adjusted Diluted EPS | | 2016 | | 2017 | | GAAP Diluted EPS Attributable to Common Shareholders | | $ | 5.65 | | | $ | 2.97 | | 2017 Tax Act Impacts(c) | | | | | | $ | 2.90 | | 2016 Restructuring (pre-tax) | | $ | 0.43 | | | | | | 2016 Tax Impact of Restructuring | | ($ | 0.15 | ) | | | | | 2016 Restructuring (after-tax) | | $ | 0.28 | | | | | | Adjusted Diluted Earnings Per Share | | $ | 5.93 | | | $ | 5.87 |
| Cumulative Adjusted Diluted EPS | | 2017 | | 2015 GAAP Diluted EPS Attributable to Common Shareholders | | $ | 5.05 | | | 2016 GAAP Diluted EPS Attributable to Common Shareholders | | $ | 5.65 | | | 2017 GAAP Diluted EPS Attributable to Common Shareholders | | $ | 2.97 | | | Cumulative GAAP Diluted EPS Attributable to Common shareholders | | $ | 13.67 | | | | | 2015 Prepaid Services Business Impairment (pre-tax)(d) | | $ | 0.41 | | | 2015 Tax Impact of Prepaid Services Business Impairment(d) | | ($ | 0.08 | ) | | 2015 Prepaid Services Business Impairment (after-tax)(d) | | $ | 0.33 | | | | | 2016 Restructuring (pre-tax) | | $ | 0.43 | | | 2016 Tax Impact of Restructuring | | ($ | 0.15 | ) | | 2016 Restructuring (after-tax) | | $ | 0.28 | | | | | | | | | 2017 Tax Act Impacts(c) | | $ | 2.90 | | | | | | | | | 2015 Adjusted Diluted EPS Attributable to Common Shareholders | | $ | 5.38 | | | 2016 Adjusted Diluted EPS Attributable to Common Shareholders | | $ | 5.93 | | | 2017 Adjusted Diluted EPS Attributable to Common Shareholders | | $ | 5.87 | | | Cumulative Adjusted Diluted EPS Attributable to Common shareholders | | $ | 17.18 | |
Table of Contents
Annex B—Information Regarding Non-GAAP Financial Measures2018 Proxy Statement
| Global Consumer Services Total Revenues ($ in millions) | | 2016 | | 2017 | | Reported Total Revenues | | $17,908 | | $18,766 | | FX-adjusted Total Revenues(b) | | $17,942 | | | | | | YoY% Increase/(Decrease) in Reported Total Revenues | | | | 5% | | YoY% Increase/(Decrease) in FX-adjusted Total Revenues | | | | 5% | | | | Global Consumer Services Q4 Revenues ($ in millions) | | 2016 | | 2017 | | Reported Q4 Revenues | | $4,406 | | $4,974 | | FX-adjusted Q4 Revenues(b) | | $4,467 | | | | | | YoY% Increase/(Decrease) in Reported Q4 Revenues | | | | 13% | | YoY% Increase/(Decrease) in FX-adjusted Q4 Revenues | | | | 11% |
| | | | | | | | | | | | | | | | | | | | | | (Billions, except percentages) | | | | | | | | | | | | | | | | | | Total Revenues Net of Interest Expense | | | 2020 | | | | 2021 | | | | 2022 | | | | 2023 | | | | | | | GAAP Total Revenues Net of Interest Expense | | $ | 36.1 | | | $ | 42.4 | | | $ | 52.9 | | | $ | 60.5 | | | | | | | Total Revenues Net of Interest Expense (FX-adjusted)(1) | | $ | 36.3 | | | $ | 41.6 | | | $ | 52.8 | | | | | | | | | | | YoY% Increase/(Decrease) in GAAP Total Revenues Net of Interest Expense | | | | | | | 17% | | | | 25% | | | | 14% | | | | | | | YoY% Increase/(Decrease) in Total Revenues Net of Interest Expense (FX-adjusted)(1) | | | | | | | 17% | | | | 27% | | | | 15% | | | | | | | | | | | | | | | | | | | | | | | | |
(a)(1) | Represents estimated Discount revenue from Costco in the U.S. for spend on American Express cards and from other merchants for spend on the Costco cobrand card as well as Other fees and commissions and Interest income from Costco cobrand Card Members. Management believes revenues net of interest expense excluding estimated Costco-related revenues is useful in evaluating the ongoing operating performance of the Company following the end of the Costco U.S. relationship.
| (b) | FX-adjusted information assumes a constant exchange rate between the periods being compared for purposes of currency translation into USDU.S. dollars (i.e., assumes the2023 foreign exchange rates used to determine results for 2017 apply to the period(s) against which such2022 results, are being compared). The Company believes the presentation of information on an FX-adjusted basis is helpful2022 foreign exchange rates apply to investors by making it easier2021 results, 2021 foreign exchange rates apply to compare the Company’s performance in one period to that of another period without the variability caused by fluctuations in currency exchange rates. | (c) | Tax Act Impacts include deemed repatriation of certain overseas earnings and remeasurement of U.S. net deferred tax assets.
| (d) | Primarily includes the impairment of goodwill and technology costs, together with some restructuring costs, within the Prepaid Services Business.2020 results).
|
2024 PROXY STATEMENT 121 • Exhibit A—Second Amended and Restated American Express Company 2016 Incentive Compensation Plan American Express Company 2016 Incentive Compensation Plan | PURPOSE |
The purpose of the 2016 Incentive Compensation Plan (the “Plan”) is to promote shareholder value and the future success of American Express Company (the “Company”) by providing appropriate retention and performance incentives to the employees of the Company and its Affiliates and certain other individuals who perform services for the Company and its Affiliates. (a) Administration. Except as otherwise specified herein, the Plan shall be administered solely by the Compensation and Benefits Committee (the “Committee”) of the Board of Directors (the “Board”) of the Company, as such Committee is from time to time constituted, or any successor committee the Board may designate to administer the Plan. The Committee shall consist of no fewer than two directors (or such greater number as may be required for committees of the Board under the Company’s governing documents), each of whom is (i) a “Non-Employee Director” within the meaning of Rule 16b-3 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or any successor provision; and (ii) a director meeting the independence requirements for compensation committee members under the rules and regulations of the New York Stock Exchange or such other principal securities market on which the Common Shares are traded (the “Exchange”). The Committee may delegate any of its powers and duties to appropriate officer(s) of the Company in accordance with guidelines established by the Committee from time to time. (b) Authority. Subject only to Paragraph 4(g), the Committee has all the powers vested in it by the terms of the Plan set forth herein, such powers to include exclusive authority to select the employees and other individuals to be granted awards under the Plan (“Awards”), to determine the type, size and terms of the Award to be made to each individual selected, to modify the terms of any Award that has been granted, to determine the time when Awards will be granted, to establish performance objectives, and to prescribe the form of the instruments embodying Awards made under the Plan. The Committee has the power and authority to make any adjustments necessary or desirable as a result of the granting of Awards to eligible individuals located outside the United States, and to adopt, to amend or to rescind rules, procedures or subplans relating to the operation and administration of the Plan in order to accommodate local laws, policies, customs, procedures or practices, and accounting, tax or other regulatory standards, or to facilitate the administration of the Plan, including, but not limited to, the authority to adopt, to amend or to rescind rules, procedures and subplans that limit or vary: the methods available to exercise Awards; the methods available to settle Awards; the methods available for the payment of income taxes, social insurance contributions and employment taxes; the procedures for withholding on Awards; and the use of stock certificates or other indicia of ownership. The Committee may also adopt rules, procedures or subplans applicable to particular Affiliates or locations. The Committee is authorized to interpret the Plan and the Awards granted under the Plan, to establish, amend and rescind any rules and regulations relating to the Plan, and to make any other determinations which it deems necessary or desirable for the administration of the Plan. The Committee may correct any defect or supply any omission or reconcile any inconsistency in the Plan or in any Award in the manner and to the extent the Committee deems necessary or desirable to carry it into effect. Any decision of the Committee in the interpretation and administration of the Plan, as described herein, shall lie within its sole and absolute discretion and shall be final, conclusive and binding on all parties concerned. (c) Repricing Prohibited Absent Shareholder Approval. Notwithstanding any provision of the Plan, except for adjustments pursuant to Paragraph 15, the Committee shall not reprice, adjust or amend the exercise price of Stock Options or the exercise price of Stock Appreciation Rights previously awarded to any participant, whether through amendment, cancellation and replacement grant, or any other means, unless such action is approved by the shareholders of the Company. For purposes of the Plan, the term “reprice” shall mean: (i) the reduction, directly or indirectly, in the per-share exercise price of an outstanding Stock Option or Stock Appreciation Right by amendment, cancellation or substitution; (ii) any action that is treated as a repricing under United States generally accepted accounting principles; (iii) canceling a Stock Option or Stock Appreciation Right in exchange for another Stock Option, Stock Appreciation Right or other equity security (unless the cancellation and exchange occurs in connection with a merger, acquisition, or similar transaction); and (iv) any other action that is treated as a repricing by the rules or regulations of the Exchange. In addition, notwithstanding any other provision in the Plan to the contrary, a Stock Option may not be surrendered in consideration of or exchanged for cash, other Awards, or a new Stock Option having an exercise price below that of the Stock Option which was surrendered or exchanged, unless the exchange occurs in connection with a merger, acquisition, or similar transaction as set forth in Paragraph 15, or such action is approved by the shareholders of the Company. Any amendment or repeal of this Paragraph 2(c) shall require the approval of the shareholders of the Company.
• 122 2024 PROXY STATEMENT (d) Delegation. The Committee may authorize any one or more of their members or any officer of the Company to execute and deliver documents or to take any other action on behalf of the Committee with respect to Awards made or to be made to Plan participants, subject to the requirements of applicable law, including without limitation, Section 16 of the Exchange Act. For purposes of the Plan, references to the Committee shall include any such person to whom the Committee has delegated its authority pursuant to this Paragraph 2(d). (e) Indemnification. No member of the Committee and no officer of the Company shall be liable for anything done or omitted to be done by him, by any other member of the Committee or by any officer of the Company in connection with the performance of duties under the Plan, except for his own willful misconduct or as expressly provided by applicable law. (a) Participants. Consistent with the purposes of the Plan, subject only to Paragraph 4(g), the Committee shall have exclusive power to select the employees and other individuals performing services for the Company and its Affiliates who may participate in the Plan and be granted Awards under the Plan. Eligible individuals may be selected individually or by groups or categories, as determined by the Committee in its discretion. (b) Affiliates. Unless the Committee determines otherwise, as used herein, the term “Affiliate” means any entity in which the Company has a direct or indirect equity interest of 50 percent or more, as determined by the Committee in its discretion. (a) Types of Awards. Awards under the Plan may include one or more of the following types, either alone or in any combination thereof: (i) “Stock Options”, which include “Nonqualified Stock Options” and “Incentive Stock Options” or combinations thereof, are rights to purchase common shares of the Company having a par value of $.20 per share and stock of any other class or company into which such shares may thereafter be changed (the “Common Shares”). Nonqualified Stock Options and Incentive Stock Options are subject to the terms, conditions and restrictions specified in Paragraph 5. (ii) “Stock Appreciation Rights” are rights to receive (without payment to the Company) cash, Common Shares, or property, or other forms of payment, or any combination thereof, as determined by the Committee, based on the increase in the value of a Common Share over the per-share exercise price. Stock Appreciation Rights are subject to the terms, conditions and restrictions specified in Paragraph 6. (iii) Shares of “Restricted Stock” are Common Shares that are issued subject to certain restrictions pursuant to Paragraph 7. (iv) “Restricted Stock Units” are Awards that are valued by reference to a Common Share, which value may be paid to the participant by delivery of cash, Common Shares, or property, or other forms of payment, or any combination thereof, as the Committee shall determine, and that are issued subject to certain restrictions pursuant to Paragraph 7. (v) “Performance Grants” are Awards subject to the terms, conditions and restrictions described in Paragraph 8, pursuant to which the participant may become entitled to receive cash, Common Shares, or property, or other forms of payment, or any combination thereof, as determined by the Committee. The Committee may also grant any other Award providing benefits similar to (i) through (v), subject to such terms, conditions and restrictions as it may determine necessary or appropriate to satisfy non-U.S. law or regulatory requirements or avoid adverse consequences under such requirements. (b) Dividend Equivalents. Other than with respect to Stock Options or Stock Appreciation Rights, the Committee may choose, at the time of the grant of an Award or any time thereafter up to the time of the Award’s payment, to include or to exclude as part of such Award an entitlement to receive cash dividends or dividend equivalents, subject to such terms, conditions, restrictions or limitations, if any, as the Committee may establish. Dividends and dividend equivalents shall be paid in such form and manner (i.e., lump sum or installments), and at such times as the Committee shall determine. All dividends or dividend equivalents, which are not paid currently, may, at the Committee’s discretion, be held in escrow and accrue interest or be reinvested into additional Common Shares subject to the same vesting or performance conditions as the underlying Award. (c) Maximum Number of Shares that May Be Issued. (i) Available Shares. Subject to adjustment as provided in Paragraph 15, the maximum number of Common Shares that were available for issuance under the Plan upon its initial approval by the shareholders of the Company on May 2, 2016 was 17,500,000 shares. The maximum number of Common Shares available for issuance under the Plan was increased by an additional 7,000,000 Common Shares upon the approval of the first amendment and restatement of the Plan by the shareholders of the Company on May 5, 2020. The maximum number of Common Shares available for issuance under the Plan was further increased by an additional 15,000,000 Common Shares upon the approval of the second amendment and restatement of the Plan by the shareholders of the
2024 PROXY STATEMENT 123 • Company on May 6, 2024. The maximum number of Common Shares that may be issued under the Plan pursuant to Incentive Stock Options may not exceed, in the aggregate, 8,000,000. Common Shares related to Awards issued under the Plan that are forfeited, canceled, expired or otherwise terminated without the issuance of Common Shares will again be available for issuance under the Plan. The following Common Shares, however, may not again be made available for grant in respect of Awards under the Plan: (A) Common Shares not issued or delivered as a result of the net settlement of an outstanding Stock Option or Stock Appreciation Right, (B) Common Shares delivered to or withheld by the Company to pay the exercise price of or the withholding taxes with respect to an Award and (C) Common Shares repurchased on the open market with the proceeds from the payment of the exercise price of a Stock Option. (ii) Assumed or Substituted Awards. Awards granted through the assumption of, or substitution for, outstanding awards previously granted by a company acquired by the Company or any Affiliate or with which the Company or any Affiliate combines, shall not reduce the maximum number of Common Shares that may be issued under the Plan or the maximum number of Common Shares authorized for grant to a participant in any calendar year described in Paragraph 4(d). (iii) Share Counting. For purposes of counting shares against the share reserve under the Plan on the date of grant, Awards denominated solely in Common Shares (such as Stock Options and Restricted Stock) and other Awards that may be exercised for, settled in or convertible into Common Shares will be counted against the Plan reserve on the date of grant of the Award based on the maximum number of shares that may be issued pursuant to the Award, as determined by the Committee. (iv) Source of Shares. Common Shares issued pursuant to the Plan may be authorized but unissued shares, treasury shares, reacquired shares or any combination thereof. (d) Maximum Individual Limits. Subject to adjustment as provided in Paragraph 15, (i) the number of Common Shares underlying all Stock Options and Stock Appreciation Rights that may be granted to any participant within any one calendar year shall be limited to 2,000,000, (ii) in any one calendar year, no participant may receive more than 1,000,000 shares of Restricted Stock or Common Shares provided through Restricted Stock Units (excluding any Restricted Stock or Restricted Stock Units issued in satisfaction of Performance Grants) and (iii) with respect to Performance Grants, in any one calendar year, no participant may be paid cash, Common Shares or other property or any combination of the foregoing (including without limitation Restricted Stock or Restricted Stock Units that may be issued in satisfaction of a Performance Grant) with a value (as determined by the Committee) in excess of $20 million. For purposes of the foregoing sentence, the calendar year or years in which amounts under Awards are deemed paid or received shall be as determined by the Committee and any deferral of Award settlement or payment permitted or required by the Committee pursuant to Paragraph 10 of the Plan shall be disregarded for purposes of the individual annual limits. (e) Award Agreement. Unless otherwise determined by the Committee, each Award shall be evidenced by an instrument in such form as the Committee shall prescribe from time to time in accordance with the Plan, including a written agreement, contract, certificate or other instrument or document containing the terms and conditions of an individual Award granted under the Plan which may, in the discretion of the Company, be transmitted electronically. Each Award and Award Agreement shall be subject to the terms and conditions of the Plan. (f) FDIA Limitations and Recoupment Provisions. (i) Notwithstanding any other provision of the Plan to the contrary, any payments or benefits to an employee pursuant to the Plan, or otherwise, are subject to and conditioned upon their compliance with 12 USC Section 1828(k) and any regulations promulgated thereunder. (ii) Notwithstanding anything in the Plan or in any Award to the contrary, Awards (and any Common Shares or other amounts payable or paid thereunder) are subject to reduction, cancellation, repayment, forfeiture or recoupment in accordance with any clawback policy adopted by the Company, including, but not limited to, the American Express Company Incentive Compensation Recoupment Policy and the American Express Company Policy for the Recovery of Erroneously Awarded Compensation, each as in effect or as may be adopted and/or modified from time to time by the Company in its discretion, and any clawback requirements imposed under applicable laws, rules and regulations, including Section 10D of the Exchange Act and any applicable rules or standards adopted by the SEC thereunder (including Rule 10D-1 under the Exchange Act) and any applicable rules or standards adopted by the Exchange pursuant to Rule 10D-1 under the Exchange Act (including Section 303A.14 of the NYSE Listed Company Manual). (g)Non-Employee Director Awards. In respect of Awards granted to non-employee directors of the Company or its Affiliates, the Board has all the powers otherwise vested in the Committee by the terms of the Plan set forth herein, including the exclusive authority to select the non-employee directors to be granted Awards under the Plan, to determine the type, size and terms of the Award to be made to each non-employee director selected, to modify the terms of any Award that has been granted to a non-employee director, to determine the time when Awards will be granted to non-employee directors and to prescribe the form of the instruments embodying Awards made under the Plan to non-employee directors. The aggregate maximum Fair Market Value (determined on the Award grant date) of the Common Shares with respect to which Awards are granted under the Plan in any calendar year to any non-employee director in respect of services as a non-employee director shall not exceed $500,000.
• 124 2024 PROXY STATEMENT (h)Exclusion from Minimum Vesting and Continued Employment Requirements. Awards granted under Paragraphs 5, 6, 7 and 8 of the Plan shall be subject to the minimum vesting period and continued employment or provision of service requirement specified for the Award by such Paragraph, as applicable, except that: (i) up to a maximum of five percent (5%) of the maximum aggregate number of Common Shares that may be issued under the Plan pursuant to Paragraph 4(c) may be issued pursuant to Awards granted under Paragraphs 5, 6, 7 and 8 of the Plan without regard for any minimum exercisability or vesting period requirements set forth in such Paragraphs; and (ii) continued employment or provision of service for exercisability or vesting shall not be required as (A) the Committee may determine or permit otherwise in the event of death, disability, retirement or other termination of a participant, or, subject to Paragraph 16 of the Plan, in connection with a corporate transaction (which includes but is not limited to a divestiture, spin-off, split-off, asset transfer, outsourcing or joint venture formation) (each such event, a “Defined Event”), and (B) may be required or otherwise be deemed advisable by the Committee in connection with an Award granted through the assumption of, or substitution for, outstanding awards previously granted by a company acquired by the Company or any Affiliate or with which the Company or any Affiliate combines. The Committee may grant Stock Options either alone or in conjunction with Stock Appreciation Rights at the time of grant. The Committee may grant Incentive Stock Options to any employee provided the terms of such grants comply with the provisions of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”), or any successor provision, and the regulations thereunder, and that any ambiguities in construction shall be interpreted in order to effectuate that intent. Each Stock Option granted under the Plan shall comply with the following terms and conditions, and with such other terms and conditions, including, but not limited to, restrictions upon the Stock Option or the Common Shares issuable upon exercise thereof or the attainment of performance objectives as the Committee may determine, including but not limited to such performance objectives described in Paragraph 8(b), as the Committee, in its discretion, shall establish: (a)Exercise Price; Expiration Date. Except for Stock Options granted through the assumption of, or substitution for, outstanding awards previously granted by a company acquired by the Company or any Affiliate, or with which the Company or any Affiliate combines, the exercise price shall be equal to or greater than the Fair Market Value of the Common Shares subject to such Stock Option on the date that the Stock Option is granted. The Committee in its discretion shall establish the expiration date of a Stock Option; provided that in no event shall the expiration date be later than ten years from the date of grant of the Stock Option. (b)Fair Market Value. The “Fair Market Value” of a Common Share as of any specific date shall be the per Common Share closing price reported by the Exchange on such date, or, if there is no such reported closing price on such date, then the per Common Share closing price reported by the Exchange on the last previous day on which such closing price was reported, or such other value as determined by the Committee in accordance with applicable law. The “Fair Market Value” of any property other than Common Shares shall be the market value of such property as determined by the Committee using such methods or procedures as it shall establish from time to time. (c)Number of Common Shares. The Committee shall determine the number of Common Shares to be subject to each Stock Option. The number of Common Shares subject to an outstanding Stock Option may be reduced on a share-for-share or other appropriate basis, as determined by the Committee, to the extent that Common Shares under such Stock Option are used to calculate the cash, Common Shares, or property, or other forms of payment, or any combination thereof, received pursuant to exercise of a Stock Appreciation Right attached to such Stock Option. (d)Minimum Vesting Period. Stock Options shall not vest for at least one year after the date of grant, except as (A) the Committee may determine or permit otherwise in the event of a Defined Event or (B) may be required or otherwise be deemed advisable by the Committee in connection with Stock Options granted through the assumption of, or substitution for, outstanding awards previously granted by a company acquired by the Company or any Affiliate or with which the Company or any Affiliate combines. (e)Exercisability. The Stock Option shall not be exercisable: (i) unless the Stock Option has vested; and (ii) unless payment in full for the Common Shares being acquired thereunder at the time of exercise is made in such form as the Committee may determine in its discretion, including, but not limited to (A) cash, (B) Common Shares, (C) if permitted by the Committee, by authorizing a third party to sell, on behalf of the participant, the appropriate number of Common Shares otherwise issuable to the participant upon the exercise of the Stock Option and to remit to the Company a sufficient portion of the sale proceeds to pay the entire exercise price and any tax withholding resulting from such exercise, or (D) any combination thereof; and
2024 PROXY STATEMENT 125 • (iii) unless the participant has been, at all times during the period beginning with the date of the grant of the Stock Option and ending on the date of such exercise, employed by (in the case of an Incentive Stock Option) or otherwise performing services for the Company or an Affiliate, or a corporation, or a parent or subsidiary of a corporation, substituting or assuming the Stock Option in a transaction to which Section 424(a) of the Code or any successor statutory provision thereto, is applicable, except that: (A) in the case of any Nonqualified Stock Option, if such person shall cease to be employed by or otherwise performing services for the Company or an Affiliate solely by reason of the occurrence of a Defined Event, he may, during such period following the Defined Event as the Committee, in its discretion, may determine or permit, exercise the Nonqualified Stock Option as if he continued such employment or performance of service during such permitted period; and (B) in the case of any Nonqualified Stock Option, if such person shall cease to be employed by or otherwise performing services for the Company or an Affiliate solely by reason of a period of Related Employment as defined in Paragraph 14, he may, during such period of Related Employment, exercise the Nonqualified Stock Option as if he continued such employment or performance of service; and (C) in the event of the person’s death, the Committee may provide a decedent’s executors, heirs or distributors a minimum period to exercise a Stock Option with respect to any shares as to which the decedent could have exercised the Stock Option at the time of his death, or such greater amount as the Committee may determine. (f)Incentive Stock Option Limitation. To the extent that the aggregate Fair Market Value (determined as of the date of grant) of the Common Shares with respect to which Incentive Stock Options are exercisable for the first time by any individual during any calendar year (under all plans of the Company and its Affiliates) exceeds $100,000, such Incentive Stock Options or portions thereof which exceed such limit (according to the order in which they were granted) shall be treated as Nonqualified Stock Options. | 6. | STOCK APPRECIATION RIGHTS |
The Committee may grant Stock Appreciation Rights either alone or in conjunction with Stock Options at the time of grant. Each Award of Stock Appreciation Rights granted under the Plan shall comply with the following terms and conditions, and with such other terms and conditions, including, but not limited to, restrictions upon the Award of Stock Appreciation Rights or the Common Shares issuable upon exercise thereof or the attainment of performance objectives as the Committee may determine, including but not limited to such performance objectives described in Paragraph 8(b), as the Committee, in its discretion, may establish: (a)Exercise Price;Expiration Date. Except for Stock Appreciation Rights granted through the assumption of, or substitution for, outstanding awards previously granted by a company acquired by the Company or any Affiliate, or with which the Company or any Affiliate combines, the exercise price shall be equal to or greater than the Fair Market Value of the Common Shares subject to such Stock Appreciation Right on the date that the Stock Appreciation Right is granted. A Stock Appreciation Right granted in conjunction with a Stock Option shall have a per-share exercise price not less than the exercise price of the Stock Option to which the Stock Appreciation Right is attached. The Committee in its discretion shall establish the expiration date of a Stock Appreciation Right; provided that in no event shall the expiration date be later than ten years from the date of grant of the Stock Appreciation Right. (b) Number of Common Shares. The Committee shall determine the number of Common Shares to be subject to each Award of Stock Appreciation Rights. The number of Common Shares subject to an outstanding Award of Stock Appreciation Rights may be reduced on a share-for-share or other appropriate basis, as determined by the Committee, to the extent that Common Shares under such Award of Stock Appreciation Rights are used to calculate the Common Shares received pursuant to exercise of a Stock Option attached to such Award of Stock Appreciation Rights. (c) Minimum Vesting Period. The Award of Stock Appreciation Rights shall not vest for at least one year after the date of grant, except as (A) the Committee may determine or permit otherwise in the event of a Defined Event or (B) may be required or otherwise be deemed advisable by the Committee in connection with Stock Appreciation Rights granted through the assumption of, or substitution for, outstanding awards previously granted by a company acquired by the Company or any Affiliate or with which the Company or any Affiliate combines. (d) Exercisability. The Award of Stock Appreciation Rights shall not be exercisable: (i) unless the Award of the Stock Appreciation Rights has vested or the Stock Option to which the Award of Stock Appreciation Rights is attached, if any has vested; and (ii) unless the person exercising the Award of Stock Appreciation Rights has been at all times during the period beginning with the date of the grant thereof and ending on the date of such exercise, employed by or otherwise performing services for the Company or an Affiliate, except that: (A) in the case of any Award of Stock Appreciation Rights (other than those attached to an Incentive Stock Option), if such person shall cease to be employed by or otherwise performing services for the Company or an Affiliate solely by reason of the occurrence of a Defined Event, he may, during such period following the Defined Event as the Committee, in its discretion, may determine or permit, exercise the Award of Stock Appreciation Rights as if he continued such employment or performance of service during such permitted period; and
• 126 2024 PROXY STATEMENT (B) in the case of any Award of Stock Appreciation Rights, (other than those attached to an Incentive Stock Option), if such person shall cease to be employed by or otherwise performing services for the Company or an Affiliate solely by reason of a period of Related Employment as defined in Paragraph 14, he may, during such period of Related Employment, exercise the Award of Stock Appreciation Rights as if he continued such employment or performance of services; and (C) in the event of the person’s death, the Committee may provide his executors, heirs or distributors a minimum period to exercise an Award of Stock Appreciation Rights with respect to any shares as to which the decedent could have exercised the Award of Stock Appreciation Rights, or such greater amount as the Committee may determine. (e) Exercise and Settlement. An Award of Stock Appreciation Rights shall entitle the holder (or any person entitled to act under the provisions of Paragraph 6(d)(ii)(C)) to exercise such Award and to surrender unexercised the Stock Option to which the Stock Appreciation Right is attached (or any portion of such Stock Option) to the Company and to receive from the Company in exchange therefore, without payment to the Company, that number of Common Shares having an aggregate value equal to (or, in the discretion of the Committee, less than) the excess of the Fair Market Value of one Common Share, at the date of such exercise, over the exercise price per share, times the number of shares subject to the Award or the Stock Option, or portion thereof, which is so exercised or surrendered, as the case may be. The Committee shall be entitled in its discretion to elect to settle the obligation arising out of the exercise of a Stock Appreciation Right by the payment of cash, property, or other forms of payment, or any combination thereof, as determined by the Committee, equal to the aggregate Fair Market Value of the Common Shares it would otherwise be obligated to deliver. (f) Deemed Exercise. An Award of Stock Appreciation Rights may provide that it shall be deemed to have been exercised at the close of business on the business day preceding the expiration date of the Stock Appreciation Right (or of the related Stock Option), or such other date as specified by the Committee, if at such time such Stock Appreciation Right has a positive value. Such deemed exercise shall be settled or paid in the same manner as a regular exercise thereof, as provided in Paragraph 6(e). (g) No Fractional Shares. No fractional shares may be delivered under this Paragraph 6, but in lieu thereof a cash or other adjustment shall be made as determined by the Committee in its discretion. | 7. | RESTRICTED STOCK; RESTRICTED STOCK UNITS |
Each Award of Restricted Stock or Restricted Stock Units under the Plan shall comply with the following terms and conditions, and with such other terms and conditions as the Committee, in its discretion, shall establish: (a) Number of Common Shares. The Committee shall determine the number of Common Shares to be issued to a participant pursuant to the Award, and the extent, if any, to which they shall be issued in exchange for cash, other consideration, or both. (b) Restricted Period. Restricted Stock Units and the Common Shares issued to a participant in accordance with the Award of Restricted Stock may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of, except by will or the laws of descent and distribution, or as otherwise determined by the Committee, for such period as the Committee shall determine, from the date on which the Award is granted (the “Restricted Period”). Any attempt to dispose of any such Restricted Stock Units or Common Shares in contravention of the foregoing restrictions shall be null and void and without effect. (c) Restricted Stock. Common Shares issued to a participant in accordance with the Award of Restricted Stock may be issued in certificate form or through the entry of an uncertificated book position on the records of the Company’s transfer agent and registrar. The Company may impose appropriate restrictions on the transfer of such Common Shares which shall be evidenced in the manner permitted by law as determined by the Committee in its discretion. (d) Vesting Conditions. The vesting of the Award of Restricted Stock or Restricted Stock Units may be conditioned upon the attainment of specific performance objectives as the Committee may determine, including but not limited to such performance objectives described in Paragraph 8(b). (e) Minimum Vesting Periods. The Restricted Period shall be for a minimum of one year, except as (A) the Committee may determine or permit otherwise in the event of a Defined Event or (B) may be required or otherwise be deemed advisable by the Committee in connection with Restricted Stock or Restricted Stock Units granted through the assumption of, or substitution for, outstanding awards previously granted by a company acquired by the Company or any Affiliate or with which the Company or any Affiliate combines. (f) Shareholder Rights. Unless otherwise determined by the Committee in its discretion, prior to the expiration of the Restricted Period, a participant to whom an Award of Restricted Stock has been made (and any person succeeding to such a participant’s rights pursuant to the Plan) shall have ownership of such Common Shares, including the right to vote the same and to receive dividends or other distributions made or paid with respect to such Common Shares, subject, however, to the restrictions and limitations imposed thereon pursuant to the Plan. The Award of a Performance Grant to a participant will entitle the participant to receive an amount in cash, Common Shares or other property (including but not limited to other Awards) determined by the Committee if the terms and conditions specified herein and in
2024 PROXY STATEMENT 127 • the Award are satisfied. The Award of a Performance Grant shall be subject to the following terms and conditions, and to such other terms and conditions, including but not limited to, restrictions upon any cash, Common Shares or property, or other forms of payment, or any combination thereof, issued in respect of the Performance Grant, as the Committee, in its discretion, shall establish: (a) Grant Terms. The Committee shall determine the value or the range of values of a Performance Grant to be awarded to each participant selected for an Award of a Performance Grant and the performance objectives (which may but need not include the performance objectives described in Paragraph 8(b)) upon which the vesting, payment or settlement of the Performance Grants is conditioned. Performance Grants may be issued in different classes or series having different names, terms and conditions. (b) Performance Objectives. Such performance objectives may vary by participant and by Award, and may be based upon the attainment of specific or per-share amounts of, or changes in, one or more, or a combination of two or more, of the following: revenue, revenue growth or product revenue growth; net income (before or after taxes); earnings (including earnings before taxes, earnings before interest and taxes or earnings before interest, taxes, depreciation and amortization) or earnings per share; shareholders’ equity or return on shareholders’ equity; assets, return on assets or net assets; capital or return on capital (including return on total capital or return on invested capital); book value or book value per share; economic value added models or equivalent metrics; operating income (before or after taxes); pre- or after-tax income (before or after allocation of corporate overhead or incentive compensation); operating expenses or reengineering savings; operating margins, gross margins or cash margin; cash flow, cash flow per share (before or after dividends) or cash flow return on investment; stock price or TSR; market share; debt reduction; CCAR related capital ratios; credit metrics; regulatory achievements; or such other performance objectives determined by the Committee in its sole discretion. The Committee may provide that, in measuring the achievement of the performance objectives, an Award may include or exclude items such as realized investment gains and losses, extraordinary, unusual, non-recurring or infrequently recurring items, asset write-downs, effects of accounting changes, currency fluctuations, acquisitions, divestitures, reserve-strengthening and other non-operating items. The foregoing objectives may be applicable to the Company as a whole, one or more of its subsidiaries, divisions, business units or business lines, or any combination of the foregoing, and may be applied on an absolute basis or be relative to other companies, industries or indices (e.g., stock market indices) or be based upon any combination of the foregoing. In addition to the performance objectives, the Committee may also condition payment of any Performance Grant upon the attainment of conditions, such as completion of a period of service, notwithstanding that the performance objective or objectives specified in such Award are satisfied. (c) Minimum Vesting Periods. The vesting period (the “Award Period”) in respect of any Performance Grant shall be a period determined by the Committee. The Award Period shall be for a minimum of one year, except as (A) the Committee may determine or permit otherwise in the event of a Defined Event or (B) may be required or otherwise be deemed advisable by the Committee in connection with Performance Grants granted through the assumption of, or substitution for, outstanding awards previously granted by a company acquired by the Company or any Affiliate or with which the Company or any Affiliate combines. | 9. | [INTENTIONALLY OMITTED] |
The Committee may, in its discretion, settle any Award through the payment of cash, the delivery of Common Shares or property, the granting of Awards, or a combination thereof as the Committee shall determine. Any Award settlement, including payment deferrals, may be subject to conditions, restrictions and contingencies as the Committee shall determine. The Committee may permit or require the deferral of any Award payment, subject to such terms, rules and procedures as the Committee may establish, which may include provisions for the payment or crediting of interest, or dividend equivalents, including converting such credits into deferred Common Share equivalents; provided, that the Committee shall not have any such authority to the extent that the grant or exercise of such authority would cause any tax to become due under Section 409A of the Code and the Treasury Regulations promulgated and other official guidance issued thereunder (collectively, “Section 409A”). | 11. | AMENDMENT OF THE PLAN OR AWARDS |
The Plan may be amended in whole or in part at any time and from time to time by the Board, and the terms of any outstanding Award under the Plan may be amended from time to time by the Committee (or Board as applicable) in its discretion in any manner that it deems necessary or appropriate; provided however, that no amendment may be made without shareholder approval if such amendment would (a) increase the number of shares available for grant specified in Paragraph 4(c) (other than pursuant to Paragraph 15); (b) decrease the minimum Stock Option exercise price set forth in Paragraph 5(a) (other than changes made pursuant to Paragraph 15); (c) reduce the minimum vesting or performance periods set forth in Paragraph 5(d), 6(c), 7(e) or 8(c); (d) change the individual Award limits set forth in Paragraph 4(d) or 4(g) (other than pursuant to Paragraph 15); (e) amend or repeal the prohibitions against repricing or exchange set forth in Paragraph 2(c); or (f) in the absence of shareholder approval, adversely affect compliance of the Plan with applicable laws, rules and regulations. No such amendment shall adversely affect in a material manner any right of a participant under an Award without his written consent. Any shareholder approval requirement under the Plan will be met if such approval is obtained in accordance with applicable law. Notwithstanding the foregoing, any amendment to the Plan or any outstanding Award under the Plan shall be made in a manner as to ensure that an Award intended to be exempt from Section 409A will continue to be exempt from Section 409A or that the Award will comply with the requirements of Section 409A.
• 128 2024 PROXY STATEMENT For the purposes of this Plan, a participant shall be deemed to have terminated his employment or performance of services for the Company and its Affiliates by reason of disability, if the Committee shall determine that the physical or mental condition of the participant by reason of which such employment or performance of services terminated was such at that time as would entitle him to payment of monthly disability benefits under the Company’s Long-Term Disability Benefit Plan, or, if the participant is not eligible for benefits under such plan, under any similar disability plan of the Company or an Affiliate in which he is a participant. If the participant is not eligible for benefits under any disability plan of the Company or an Affiliate, he shall be deemed to have terminated such employment or performance of services by reason of disability if the Committee shall determine that his physical or mental condition would entitle him to benefits under the Company’s Long-Term Disability Benefit Plan if he were eligible therefore. Notwithstanding the above, the Committee may determine a participant’s disability based upon any other criteria specified by the Committee. Notwithstanding the foregoing, to the extent required for exemption from or compliance with Section 409A, “disability” shall have the meaning set forth in Section 409A. | 13. | TERMINATION OF A PARTICIPANT. |
For all purposes under the Plan, the Committee shall determine whether a participant has terminated employment with or the performance of services for the Company and its Affiliates; provided, however, that transfers between the Company and an Affiliate or between Affiliates, and approved leaves of absence shall not be deemed such a termination; and provided further that to the extent required for exemption from or compliance with Section 409A, termination of employment shall mean a “separation from service” within the meaning of Section 409A. For the purposes of the Plan, “Related Employment” shall mean the employment or performance of services by an individual for an employer that is neither the Company nor an Affiliate; provided that (a) such employment or performance of services is undertaken by the individual at the request of the Company or an Affiliate, (b) immediately prior to undertaking such employment or performance of services, the individual was employed by or performing services for the Company or an Affiliate or was engaged in Related Employment as herein defined and (c) such employment or performance of services is in the best interests of the Company and is recognized by the Committee, in its discretion, as Related Employment for purposes of this Paragraph 14. The death or disability of an individual during a period of Related Employment as herein defined shall be treated, for purposes of this Plan, as if the death or onset of disability had occurred while the individual was employed by or performing services for the Company or an Affiliate. | 15. | DILUTION AND OTHER ADJUSTMENTS |
(a) In the event of any change in the outstanding Common Shares of the Company by reason of any corporate transaction or change in corporate capitalization such as a stock split, stock dividend, split-up, split-off, spin-off, recapitalization, merger, consolidation, rights offering, reorganization, combination, consolidation, subdivision or exchange of shares, a sale by the Company of all or part of its assets, any distribution to shareholders other than a normal cash dividend, partial or complete liquidation of the Company or other extraordinary or unusual event, the Committee or Board, as applicable, shall make such adjustment in: (i) the class and aggregate number of Common Shares that may be delivered under the Plan as described in Paragraph 4(c) and the individual Award maximum limits under Paragraphs 4(d) and 4(g); (ii) the class, number and exercise price of outstanding Stock Options; (iii) the class, number and exercise price of outstanding Stock Appreciation Rights; and (iv) the class and number of shares subject to any other Awards granted under the Plan (provided that the number of shares of any class subject to Awards shall always be a whole number), as may be determined to be appropriate by the Committee or Board, as applicable, and such adjustments shall be final, conclusive and binding for all purposes of the Plan. (b) In the event of any merger, consolidation or similar transaction as a result of which the holders of Common Shares receive consideration consisting exclusively of securities of the surviving entity (or the parent of the surviving entity) in such transaction, the Committee or Board, as applicable, shall, to the extent deemed appropriate by the Committee or Board, as applicable, adjust each Award outstanding on the date of such merger, consolidation or similar transaction so that it pertains and applies to the securities which a holder of the number of shares of Common Stock subject to such Award would have received in such merger, consolidation or similar transaction. (c) In the event of (i) a dissolution or liquidation of the Company, (ii) a sale of all or substantially all of the Company’s assets (on a consolidated basis), (iii) a merger, consolidation or similar transaction involving the Company in which the holders of Common Shares receive securities and/or other property, including cash, other than shares of the surviving entity in such transaction (or the parent of such surviving entity), the Committee or Board, as applicable, shall, to the extent deemed appropriate by the Committee or Board, as applicable, have the power to provide for the exchange of each Award (whether or not then exercisable or vested) for an Award with respect to (A) some or all of the property which a holder of the number of Common Shares subject to such Award would have received in such transaction or (B) securities of the acquirer or surviving entity (or parent of such acquirer or surviving entity) and, incident thereto, make an equitable adjustment as determined by the Committee or Board, as applicable, in the exercise price of the Award, or the number of shares or amount of property subject to the Award or provide for a payment (in cash or other property) to the
2024 PROXY STATEMENT 129 • participant to whom such Award was granted in partial consideration for the exchange of the Award; provided, however, that in the event that the acquirer does not agree to the assumption or substitution of Awards in the foregoing manner, the Committee shall, to the extent deemed appropriate by the Committee or Board, as applicable, have the power to cancel, effective immediately prior to the occurrence of such event, each Award (whether or not then exercisable or vested), and, in full consideration of such cancellation, pay to the participant to whom such Award was granted an amount in cash, for each Common Share subject to such Award, equal to the value, as determined by the Committee or Board, as applicable, of such Award, provided that with respect to any outstanding Stock Option or Stock Appreciation Right such value shall be equal to the excess of (A) the value, as determined by the Committee or Board, as applicable, of the property (including cash) received by the holder of a Common Share as a result of such event over (B) the exercise price of such Stock Option or Stock Appreciation Right and that no change to the original timing of payment will be made to the extent it would result in a tax under Section 409A. The Committee (or Board as applicable) may provide in the Award Agreement for provisions relating to a “change in control” of the Company (as such term is defined in the Award Agreement), including without limitation the acceleration of the exercisability, vesting or settlement of, or the lapse of restrictions or deemed satisfaction of performance objectives with respect to, an Award; provided that, in addition to any other conditions provided for in the Award Agreement: (a) any acceleration of the exercisability, vesting or settlement of, or the lapse of restrictions or deemed satisfaction of performance objectives with respect to, an Award in connection with a change in control may occur only if (i) the change in control occurs and (ii) either (A) the employment of the participant is terminated (as set forth in the Award Agreement) (i.e., “double-trigger”) or (B) the acquirer does not agree to the assumption or substitution of outstanding Awards; (b) with respect to any Award granted under the Plan that is earned or vested based upon achievement of performance objectives (included but not limited to Performance Grants), any amount deemed earned or vested in connection with a change in control or associated termination of employment shall be based upon the degree of performance attainment and/or the period of time elapsed in the performance period as of the applicable date; and with respect to any Award that constitutes a nonqualified deferred compensation plan within the meaning of Section 409A(d) of the Code and provides for an accelerated payment in connection with a change in control (whether or not in conjunction with a termination of employment), “change in control” shall mean a “change in the ownership of a corporation,” a “change in the effective control of a corporation” or a “change in the ownership of a substantial portion of a corporation” within the meaning of Section 409A for purposes of such accelerated payment provision. | 17. | DESIGNATION OF BENEFICIARY BY PARTICIPANT |
A participant may designate a beneficiary to receive any payment to which he may be entitled in respect of any Award under the Plan in the event of his death in a manner determined by the Committee in its discretion. If no designated beneficiary survives the participant and is living on the date on which any amount becomes payable to such participant’s beneficiary, such payment will be made to the legal representatives of the participant’s estate, and the term “beneficiary” as used in the Plan shall be deemed to include such person or persons. If there is any question as to the legal right of any beneficiary to receive a distribution under the Plan, the Committee in its discretion may determine that the amount in question be paid to the legal representatives of the estate of the participant, in which event the Company, the Board and the Committee and the members thereof will have no further liability to anyone with respect to such amount. | 18. | MISCELLANEOUS PROVISIONS. |
(a) No loans from the Company or any Affiliate to a participant shall be permitted in connection with the Plan. (b) No employee or other person shall have any claim or right to be granted an Award under the Plan. Determinations made by the Committee under the Plan need not be uniform and may be made selectively among eligible individuals under the Plan, whether or not such eligible individuals are similarly situated. Neither the Plan nor any action taken hereunder shall be construed as giving any employee or other person any right to continue to be employed by or perform services for the Company or any Affiliate, and the right to terminate the employment of or performance of services by any participant at any time and for any reason is specifically reserved. (c) (i) No participant or other person shall have any right with respect to the Plan, the Common Shares reserved for issuance under the Plan or in any Award, contingent or otherwise, until written evidence of the Award shall have been delivered to the recipient and all the terms, conditions and provisions of the Plan and the Award applicable to such recipient (and each person claiming under or through him) have been met. (ii) Unless otherwise determined by the Committee in its discretion, a participant to whom a grant of Stock Options, Stock Appreciation Rights, Performance Grants or any other Award is made (and any person succeeding to such a participant’s rights pursuant to the Plan) shall have no rights as a shareholder with respect to any Common Shares or as a holder with respect to other securities, if any, issuable pursuant to any such Award until the date of the issuance of a stock certificate to him or the entry on his behalf of an uncertificated book position on the records of the Company’s transfer agent and registrar for such Common Shares or other instrument of ownership, if any. Except as provided in Paragraph 15, no adjustment shall be made for dividends, distributions or other rights (whether ordinary or extraordinary, and whether in cash, securities, other property or other forms of consideration, or any
• 130 2024 PROXY STATEMENT combination thereof) for which the record date is prior to the date such book entry is made or a stock certificate or other instrument of ownership, if any, is issued. (d) An Award and a participant’s rights and interest under the Award, may not be sold, assigned or transferred, hypothecated or encumbered in whole or in part either directly or by operation of law or otherwise (except in the event of a participant’s death) including, but not by way of limitation, execution, levy, garnishment, attachment, pledge, bankruptcy or in any other manner; provided, however, that the Committee may allow a participant to assign or transfer without consideration an Award to one or more members of his immediate family, to a partnership of which the only partners are the participant or members of the participant’s immediate family, to a trust established by the participant for the exclusive benefit of the participant or one or more members of his immediate family or pursuant to a domestic relations order (as defined in the Code). (e) No Common Shares, property, or other forms of payment shall be issued hereunder with respect to any Award unless counsel for the Company shall be satisfied that such issuance will be in compliance with applicable federal, state, local and foreign legal, securities exchange and other applicable requirements. The Company shall be under no obligation to effect the registration pursuant to the Securities Act of 1933, as amended, of any Common Shares to be issued hereunder or to effect similar compliance under any state or local laws. (f) The Company and its Affiliates shall have the right to deduct from any payment made under the Plan the federal, state, local or foreign income or other taxes required by law to be withheld with respect to such payment. In accordance with rules and procedures established by the Committee, the required withholding obligations may be settled with Common Shares, including Common Shares that are part of the Award that gives rise to the withholding requirement (up to the participant’s minimum required tax withholding rate or such other rate that will not trigger a negative accounting impact). It shall be a condition to the obligation of the Company to issue Common Shares, property, or other forms of payment, or any combination thereof, upon exercise, settlement or payment of any Award under the Plan, that the participant (or any beneficiary or person entitled to act) pay to the Company, upon its demand, such amount as may be requested by the Company for the purpose of satisfying any liability to withhold federal, state, local or foreign income or other taxes. If the amount requested is not paid, the Company may refuse to issue Common Shares, property, or other forms of payment, or any combination thereof. Notwithstanding anything in the Plan to the contrary, the Committee may, in its discretion, permit an eligible participant (or any beneficiary or person entitled to act) to elect to pay a portion or all of the amount requested by the Company for such taxes with respect to such Award, at such time and in such manner as the Committee shall deem to be appropriate (including, but not limited to, by authorizing the Company to withhold, or agreeing to surrender to the Company on or about the date such tax liability is determinable, Common Shares, property, or other forms of payment, that would otherwise be distributed, or have been distributed, as the case may be, pursuant to such Award to such person, having a Fair Market Value equal to the amount of such taxes). (g) The Plan shall be unfunded. The Company shall not be required to establish any special or separate fund or to make any other segregation of assets to assure the payment of any Award under the Plan, and the rights to the payment of Awards shall be no greater than the rights of the Company’s general creditors. (h) By accepting any Award or other benefit under the Plan, each participant and each person claiming under or through him shall be conclusively deemed to have indicated his acceptance and ratification of, and consent to, any action taken under the Plan by the Company, the Board or the Committee. (i) Although the Company may structure an Award to qualify for favorable federal, state, local or foreign tax treatment, or to avoid adverse tax treatment, no person connected with the Plan in any capacity, including, but not limited to, the Company and its directors, officers, agents and employees, makes any representation, commitment or guarantee that any intended tax treatment will be applicable with respect to any Award under the Plan, or that such tax treatment will apply to or be available to a participant or his or her beneficiary. Furthermore, the existence of an Award shall not affect the right or power of the Company or its shareholders to take any corporate action, regardless of the potential effect of such action on the tax treatment of an Award under the Plan. (j) Unless the context indicates otherwise, references to “Paragraphs” in the Plan refer to Paragraphs of the Plan. (k) In the Plan, the use of the masculine pronoun shall include the feminine and the use of the singular shall include the plural, as appropriate. (l) Headings of Paragraphs herein are inserted only for convenience of reference and are not to be considered in the construction of the Plan. (m) If any provision of the Plan shall be held unlawful or otherwise invalid or unenforceable in whole or in part by a court of competent jurisdiction, such provision shall (i) be deemed limited to the extent that such court of competent jurisdiction deems it lawful, valid or enforceable and as so limited shall remain in full force and effect, and (ii) not affect any other provision of the Plan or part thereof, each of which shall remain in full force and effect. (n) The validity, construction, interpretation, administration and effect of the Plan, and of its rules and regulations, and rights relating to the Plan and to Awards granted under the Plan, shall be governed by the substantive laws, but not the choice of law rules, of the State of New York. (o) Awards granted under the Plan are intended to comply with or be exempt from Section 409A and shall be administered in a manner that is intended to comply with or be exempt from Section 409A (and thus avoid the imposition of any tax under Section 409A) and shall be construed and interpreted in accordance with such intent. To the extent that an Award or the payment, settlement or deferral
2024 PROXY STATEMENT 131 • thereof is subject to Section 409A, the Award shall be granted, paid, settled or deferred in a manner that will comply with Section 409A and the American Express Section 409A Compliance Policy, as amended from time to time, and any successor policy thereto, except as otherwise determined by the Committee. Unless the Committee determines otherwise, any provision of the Plan that would cause the grant of an Award or the payment, settlement or deferral thereof to fail compliance with or exemption from Section 409A shall be amended to comply with or be exempt from Section 409A on a timely basis, which may be made on a retroactive basis, in accordance with regulations and other guidance issued under Section 409A. The Plan may be suspended in whole or in part at any time and from time to time by the Board. This Plan shall terminate upon the earlier of the following dates or events to occur: (a) upon the adoption of a resolution of the Board terminating the Plan; or (b) May 6, 2034. No termination of the Plan shall materially alter or impair any of the rights or obligations of any person, without his consent, under any Award theretofore granted under the Plan, except that subsequent to termination of the Plan, the Committee may make amendments permitted under Paragraph 11. The Plan was initially adopted by the Board in February 2016, and approved and adopted by the shareholders on May 2, 2016. The first amendment and restatement of the Plan was subsequently adopted by the Board in March 2020, and approved and adopted by the shareholders on May 5, 2020. The second amendment and restatement of the Plan was approved by the Board in March 2024, and shall be submitted to the shareholders of the Company for their approval and adoption at a meeting to be held on or about May 6, 2024, or at any adjournment thereof. The shareholders shall be deemed to have approved and adopted the second amendment and restatement of the Plan only if it is approved and adopted at a meeting of the shareholders duly held by vote taken in the manner required by the laws of the State of New York. * * * * *
| | |  200 VESEY STREET NEW YORK, NY 10285 | | 107 |
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Location of the 2018 Annual Meeting and How to Get There
Our world headquarters is the site of the 2018 Annual Meeting of Shareholders. We are located at 200 Vesey Street on the west side of Lower Manhattan in Brookfield Place (formerly known as the World Financial Center).
By subway
Take any of these subway lines: the A, C, E, R or the 1, 2, 3, 4 or 5 trains. All of these trains stop near Brookfield Place. Brookfield Place is located across the West Side Highway (also known as West Street) from the trains, toward the Hudson River. Our building is on the north side of the Winter Garden in Brookfield Place.
By car
Take the West Side Highway in Lower Manhattan. Enter Brookfield Place by turning west on either Murray Street or Vesey Street. Go to the main entrance of our building located at the corner of Vesey Street and the West Side Highway.
If you need special assistance at the annual meeting, please contact Tangela S. Richter, our Corporate Secretary, by telephone at 212-640-2000, by email at corporatesecretarysoffice@aexp.com or by writing to her at the Company’s headquarters at 200 Vesey Street, New York, New York 10285.
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BLUE BOX | VALUES | | | VOTE ONLINE - www.proxyvote.com or scan the QR Barcode above Use the Internet to transmit your voting instructions and for electronic delivery of information up until 11:59 P.M. Eastern Time on May 1, 2024 (for holders in employee benefit plans), or up until 11:59 P.M. Eastern Time on May 5, 2024 (for all other shareholders). Have your proxy card in hand when you access the website and follow the instructions to obtain your records and to create an electronic voting instruction form. | | WE DELIVER FOR OUR CUSTOMERS.
We’re driven |
| | During The Meeting - Go to www.virtualshareholdermeeting.com/AXP2024 | | | | | You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by our commitmentthe arrow available and follow the instructions. | | | | | VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to deliver exceptional products, servicestransmit your voting instructions up until 11:59 P.M. Eastern Time on May 1, 2024 (for holders in employee benefit plans), or until 11:59 P.M. Eastern Time on May 5, 2024 (for all other shareholders). Have your proxy card in hand when you call and experiencesthen follow the instructions. Toll free in the U.S. and Canada. | | | | | VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to our customers. We value our strong customer relationships,Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. | | | | | VOTE CONFIRMATION | | | You may confirm that your instructions were received and are defined by how well we take care of them.WE MAKE IT GREAT.
We deliver an unparalleled standard of excellenceincluded in everything we do, staying focused on the biggest opportunitiesfinal tabulation to be meaningful to our customers. From our innovative products to our world-class customer service, our customers expectissued at the best—and our teams are proud to deliver it.
WE DO WHAT’S RIGHT.
Customers choose us because they trust our brand and people. We earnAnnual Meeting of Shareholders on May 6, 2024 via the ProxyVote Confirmation link at www.proxyvote.com by using the information that trustis printed in the box marked by ensuring everything we dothe arrow  .. Vote Confirmation is reliable, consistent, andavailable 24 hours after your vote is received beginning April 22, 2024, with the highest level of integrity.
WE RESPECT PEOPLE.
We are a diverse and inclusive company, and serve diverse customers. We believe we are a better company when each of us feels included, valued, and able to trust colleagues who respect each of us for who we are and what we contribute to our collective success.
WE NEED DIFFERENT VIEWS.
By being open to different ideas from our colleagues, customers and the world around us, we will find more ways to win.
WE WIN AS A TEAM.
We view each other as colleagues—part of the same team, striving to deliver the brand promise to our customers and each other every day. Individual performance is essential and valued, but never at the expense of the team.
WE CARE ABOUT COMMUNITIES.
We aim to make a difference in the communities where we work and live. Our commitment to corporate social responsibility makes an impact by strengthening our connections.
final vote tabulation remaining available through July 5, 2024. |
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|  | | | | | | American Express Company
200 Vesey Street
New York, New York 10285 |  |
Table of Contents
 200 VESEY STREET
NEW YORK, NY 10285
|  | | SCAN TO
VIEW MATERIALS & VOTE | |  | |
VOTE ONLINE - www.proxyvote.com or scan the QR Barcode above
Use the Internet to transmit your voting instructions and for electronic delivery of information up until 3:00 P.M. Eastern Time on May 2, 2018 (for holders in employee benefit plans), or up until 11:59 P.M. Eastern Time on May 6, 2018 (for all other shareholders). Have your proxy card in hand when you access the website and follow the instructions to obtain your records and to create an electronic voting instruction form.
ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS
If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receive all future proxy statements, proxy cards, and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote online and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years.
VOTE BY PHONE - 1-800-690-6903
Use any touch-tone telephone to transmit your voting instructions up until 3:00 P.M. Eastern Time on May 2, 2018 (for holders in employee benefit plans), or until 11:59 P.M. Eastern Time on May 6, 2018 (for all other shareholders). Have your proxy card in hand when you call and then follow the instructions. Toll free in the U.S. and Canada.
VOTE BY MAIL
Mark, sign, and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.
VOTE CONFIRMATION
You may confirm that your instructions were received and included in the final tabulation to be issued at the Annual Meeting on May 7, 2018 via the ProxyVote Confirmation link at www.proxyvote.com by using the information that is printed in the box marked by the arrow ➔XXXX XXXX XXXX XXXX.Vote Confirmation is available 24 hours after your vote is received beginning April 23, 2018, with the final vote tabulation remaining available through July 7, 2018.
| TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: | | | | | | E41688-P02548 | V33497-P04256 | | | KEEP THIS PORTION FOR YOUR RECORDS | |
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| | DETACH AND RETURN THIS PORTION ONLY | | | THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. | | DETACH AND RETURN THIS PORTION ONLY |
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| AMERICAN EXPRESS COMPANY | | | | | | | | | | | |
| | | Vote on Directors
| | | | | | | | | | | | The Board of Directors recommends that you vote FOR each director nominee listed in Proposal 1 below(please mark your vote for each director separately): | | | | |
| | | | | | | | | | | 1. | | Election of director nominees proposed by the Board of Directors for a term of one year. | | For | | Against | | Abstain | | Vote on Proposals | | | | | | | | | | | | | | 1a. | | Thomas J. Baltimore | | ☐ | | | | | | 1a.☐ | | Charlene Barshefsky | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | 1b. | | John J. Brennan | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | 1c. | | Peter Chernin | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | 1d. | | Ralph de la Vega | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | 1e. | | Anne L. Lauvergeon | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | 1f. | | Michael O. Leavitt | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | 1g. | | Theodore J. Leonsis | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | 1h. | | Richard C. Levin | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | 1i. | | Samuel J. Palmisano | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | 1j. | | Stephen J. Squeri | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | 1k. | | Daniel L. Vasella | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | 1l. | | Ronald A. Williams | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | 1m. | | Christopher D. Young | | ☐ | | ☐ | | ☐ |
Vote on Proposals
| The Board of Directors recommends that you vote FOR the following proposals: | | For | | Against | | Abstain | | | Against | | Abstain | | | | | | | | | | | | | | | | | 1b. | | John J. Brennan | | ☐ | | ☐ | | ☐ | | 2. | | Ratification of appointment of PricewaterhouseCoopers LLP as independent registered public accounting firm for 2018. | | ☐ | | ☐ | | ☐ | | 2024. | | | ☐ | | ☐ | | ☐ | | | | | 1c. | | Walter J. Clayton III | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | | | | | | 1d. | | Theodore J. Leonsis | | ☐ | | ☐ | | ☐ | | 3. | | Approval, on an advisory basis, of the Company'sCompany’s executive compensation. | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | | | | 1e. | | Deborah P. Majoras | | ☐ | | ☐ | | ☐ | | | | 4. | | Approval of the Second Amended and Restated American Express Company 2016 Incentive Compensation Plan. | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | | | 1f. | | Karen L. Parkhill | | ☐ | | ☐ | | ☐ | | The Board of Directors recommends that you vote AGAINST the following proposals: | | For | | Against | | Abstain | | | | For | | Against | | Abstain | | | | 4. | | | | | | | | | | | | | 1g. | | Charles E. Phillips | | ☐ | | ☐ | | ☐ | | 5. | | Shareholder proposal relating to action by written consent.golden parachutes. | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | | | | 1h. | | Lynn A. Pike | | ☐ | | ☐ | | ☐ | | | | 6. | | | | | | | | 5. | | Shareholder proposal relating to independent board chairman.climate lobbying. | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | | | | 1i. | | Stephen J. Squeri | | ☐ | | ☐ | | ☐ | | | | 7. | | Shareholder proposal relating to merchant category codes. | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | |
| | 1j. | | Daniel L. Vasella | | ☐ | | ☐ | | ☐ | | The proxies are authorized to vote in their discretion upon any other matter that may properly come before the meeting or any adjournment(s) or postponement(s) thereof. | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | 1k. | | Lisa W. Wardell | | ☐ | | ☐ | | ☐ | | | | | | | | | | | | | | | | | | | | | | | | | For address changes and/or comments, please check this box and write them on the back where indicated.
| | | | | | ☐ | | | | | | | | | | | | Signed proxies returned without specific voting instructions as to any director or item will be voted as the Board of Directors recommends. | | | | | | | | | | | | | | | | | | | 1l. | | Christopher D. Young | | ☐ | | ☐ | | ☐ | | | | | Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer. | | | | | | |
Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.
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| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | Signature [PLEASE SIGN WITHIN BOX] | | Date | | | | Signature (Joint Owners) | | Date | | |
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Notice to employees participating in the American Express Retirement Savings Plan (RSP)
or the Employee Stock Ownership Plan (ESOP) of Amex Canada, Inc. and Amex Bank of Canada. Your voting instructions must be received on or before 3:0011:59 P.M. Eastern Time on
May 2, 2018,1, 2024, by Broadridge, which is acting on behalf of the Trustees of the RSP and ESOP.
If your voting instructions are not received by 3:0011:59 P.M. Eastern Time on May 2, 2018,
1, 2024, the Trustees of the RSP and the ESOP will not vote the shares. Annual Meeting of Shareholders Participation Please check our Investor Relations website for the most up to date information about attending our meeting - http://ir.americanexpress.com. Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
Meeting of Shareholders: The Annual Report, Notice and Proxy Statement are available at www.proxyvote.com.www.proxyvote.com. — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — — V33498-P04256
AMERICAN EXPRESS COMPANY
Proxy for the Annual Meeting of Shareholders
to be held on Monday, May 7, 2018
6, 2024 Solicited on behalf of the Board of Directors The undersigned hereby appoints Laureen E. Seeger, Tangela S. Richter and Kristina V. Fink and David A. Kanarek, or any of them, proxies or proxy, with full power of substitution, to vote all common shares of American Express Company (the Company) that the undersigned is entitled to vote at the Annual Meeting of Shareholders (the Meeting) to be held at the Company’s headquarters at 200 Vesey Street, New York, NY 10285,www.virtualshareholdermeeting.com/AXP2024 on Monday, May 7, 20186, 2024 at 9:00 A.M., Eastern Time and at any adjournment(s) or postponement(s) of the Meeting, as indicated on the reverse side of this proxy card with respect to the proposals set forth in the proxy statement, and in their discretion upon any matter that may properly come before the Meeting or any adjournment(s) or postponement(s) of the Meeting. The undersigned hereby revokes any proxies submitted previously. To ensure timely receipt of your vote and to help the Company reduce costs, you are encouraged to submit your voting instructions online or by telephone. Follow the instructions on the reverse side of this card. If you choose to submit your voting instructions by mail: Mark, sign, and date this proxy card on the reverse side and return it promptly in the envelope provided.You do not need to mark any boxes if you wish to vote asThis proxy, when properly executed, will be voted in the manner directed herein. If no such direction is made, this proxy will be voted in accordance with the Board of Directors recommends.Directors’ recommendations. Address Changes/Comments: | | | |
(If you noted any Address Changes/Comments above, please mark corresponding box on the reverse side.)
(Please sign and date on the reverse side)
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