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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934 (Amendment No.  )

Filed by the RegistrantFiled by a party other than the Registrant


CHECK THE APPROPRIATE BOX:
Preliminary Proxy Statement
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
Definitive Proxy Statement
Definitive Additional Materials
Soliciting Material under §240.14a-12

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United Parcel Service, Inc.

(Name of Registrant as Specified In Its Charter)

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


PAYMENT OF FILING FEE (CHECK ALL BOXES THAT APPLY):
No fee required
Fee paid previously with preliminary materials
Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11




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Table of Contents

Notice of 2022 Annual Meeting
of Shareowners and Proxy Statement

Thursday, May 5, 2022
8:00 a.m. Eastern Time

www.virtualshareholdermeeting.com/UPS2022


Table of Contents

Table of Contents

Corporate Governance10
Board Diversity11
Board Refreshment and Succession Planning11
Director Independence11
Board Oversight of Strategic Planning
Political Engagement
Risk Oversight14
Strategic Planning and Oversight14
Management Succession Planning and Development15
Political Contributions and Lobbying18
19
Human Capital Management20
Corporate Governance Guidelines and Committee Charters21
Our Board of Directors
Compensation Committee Report31
45
2021 Grants of Plan-Based Awards
56
Shareowner Proposals62
62
Proposal 5 — Shareowner Proposal Requesting the Board Prepare a Report on the Alignment of Lobbying Activities with the Paris Climate Agreement65
Proposal 6 — Shareowner Proposal to Reduce the Voting Power of Class A Stock from 10 Votes Per Share to One Vote PerShare
72
Proposal 9 — Shareowner Proposal Requesting the Board Prepare an Annual Report on Diversity, Equity and Inclusion


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United Parcel Service, Inc.

55 Glenlake Parkway, N.E.


Atlanta, GA 30328

March 21, 2022

18, 2024

Dear Fellow Shareowners:

Shareowners,
Johnson_photo.jpg

It is my pleasure to invite you to attend the 20222024 UPS Annual Meeting of Shareowners. This is your opportunityWe encourage you to attend the meeting and to share your views about our Company.
I am honored to serve as board chair and to help facilitate the effective oversight of our Company’s strategy and risks. Your board is highly engaged and has a productive working relationship with management. Each director brings a diverse set of skills and perspectives to the boardroom which, taken together, contributes to the successful execution of our responsibilities. We remain focused on creating long-term value for all stakeholders.
In 2023, our Company faced significant headwinds, including economic pressures, increasing geopolitical tensions, high inflation, changing consumer shopping behaviors, trade lane shifts and the Board of Directors. We take this feedback into account asour union contract negotiations. Despite these uncertainties, we perform ourwere still able to return over $7.6 billion to shareowners in 2023 through dividends and share repurchases, and we have established a new baseline for growth.
The board responsibilities.

The uncertainty resulting from the pandemicrecognizes management’s many achievements during such a challenging year. Management continued to challenge us during 2021. Despite this, the Company capitalized on opportunities to create long-term value as it continued to execute its strategy – Customer First, People Led, Innovation Driven.

Carol completed a successful first full year as CEO, aligning UPS leadership and executing under her Better, Not Bigger strategic framework. Carol’s leadership and the board’s oversight have strengthened the link betweenmake progress against the Company’s strategic frameworkstrategy, including investing back in the business to drive productivity and its financial commitments, connecting purpose to strategy.

We understand that delivering on our financial targets is critical to creating long-term shareholder value. In 2021, the Company generated record results, including strong profitfuture growth, through increased margins in all segments, primarily facilitated by management’s focus on executing strategic initiatives,acquisitions and remaining focused on premium markets, including targeted international growth, healthcare, and small and medium-sized businesses. All of this occurred with an increased emphasis on attracting, developing,businesses, healthcare, and retaining a motivatedinternational growth. The Company once again provided best-in-class service, successfully managed our best-in-class network and valued workforce that embraces diversity and inclusion. The Company’s emphasis on taking care ofstrategically expanded its customers and employees positions us well for sustainable success.

service offerings. In 2021, the board oversaw the development of new sustainability and ESG goals, including the goal of becoming carbon neutral by 2050, the goal of having 28% women in management and the goal of maintaining 35% ethnically diverse company management. The board also facilitated the first publication of the Company’s EEO-1 report and the formal delegation of human capital oversight responsibility to the board’s Compensation Committee. Our five new directors have contributed significantly to boardroom discussions related to the advancement of these matters. However, we understand there is still more work to do at this important time.

The board is also proud of the efforts of all UPSers who helped drive our purpose - moving our world forward by delivering what matters. Since its founding almost 115 years ago, UPS has fostered an employee ownership culture, with employees regularly answering the call to help one another and our communities. In 2021,addition, the Company achievedentered into a number of significant milestones, including delivering over 1 billion doses of the COVID-19 vaccine. The board continues to believe“win-win-win” labor contract that this culture is significantly facilitated by the Company’s capital structure. UPS’s unique employee ownership model has helped it grow and thrive by allowing management to run the Company with a sense of purpose by focusing on sustainable long-term value creation benefiting all stakeholders. It is indicative of this culture that the board and management have embraced the increased stakeholder focus on environmental, social and governance matters.

provides meaningful labor certainty.

In closing, I want to encourage all my fellow shareowners to vote. We are grateful to those shareowners who have previously shared their views. As we approach the Annual Meeting, I encourage you toplease contact us with any questions or feedback at 404-828-6059.

On behalf of the entire Board of Directors, thank you for your continued support.

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William Johnson

UPS Board Chair

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Notice of Annual Meeting of Shareowners and 20222024 Proxy Statement


Table of Contents

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Notice of Annual Meeting

UNITED PARCEL SERVICE, INC.

55 Glenlake Parkway, N.E., Atlanta, Georgia 30328

Date and Time: May 5, 2022, 8:00 a.m. Eastern Time
Place: The meeting will be held exclusively online via webcast at: www.virtualshareholdermeeting.com/UPS2022.
Record Date: March 9, 2022
Distribution Date: A Notice of Internet Availability of Proxy Materials or the proxy statement is first being sent to shareowners on or about March 21, 2022.
Voting: Holders of class A common stock are entitled to 10 votes per share; holders of class B common stock are entitled to one vote per share. Your vote is important. Please vote as soon as possible through the Internet, by telephone or by signing and returning your proxy card (if you received a paper copy of the proxy card). Your voting options are described on the Notice of Internet Availability of Proxy Materials, voting instruction form and/or proxy card.
Attending the Meeting: You or your proxyholder can participate, vote, ask questions and examine our list of shareowners at the meeting by visiting www.virtualshareholdermeeting.com/UPS2022 and using your 16-digit control number found on your proxy card, voting instruction form or Notice of Internet Availability. Shareowners who do not receive a 16-digit control number should consult their voting instruction form or Notice of Internet Availability and may need to request a legal proxy from their bank, broker or other nominee in advance of the meeting in order to participate. For more information, please see page 80.

Date and Time: May 2, 2024, 8:00 a.m. Eastern Time
Place: The United Parcel Service, Inc. 2024 Annual Meeting of shareowners will be held online via webcast at www.virtualshareholdermeeting.com/UPS2024.
Record Date: March 5, 2024
Distribution Date: A Notice of Internet Availability of Proxy Materials or the Proxy Statement is first being sent to shareowners on March 18, 2024.
Voting: Holders of class A common stock are entitled to 10 votes per share on each matter to be acted upon; holders of class B common stock are entitled to one vote per share on each matter to be acted upon. Your vote is important. Please vote as soon as possible through the Internet, by telephone or by signing and returning your proxy card (if you received a paper copy of the proxy card). Your voting options are described on the Notice of Internet Availability of Proxy Materials, voting instruction form and/or proxy card. Brokers are not permitted to vote on certain proposals and may not vote on any of the proposals unless you provide voting instructions. Voting your shares will help to ensure that your interests are represented at the meeting.
Attending the Meeting: You or your proxy holder can participate, vote and ask questions at the meeting by visiting www.virtualshareholdermeeting.com/UPS2024 and using your 16-digit control number found on your proxy card, voting instruction form or Notice of Internet Availability of Proxy Materials. Shareowners who do not receive a 16-digit control number should consult their voting instruction form or Notice of Internet Availability of Proxy Materials and may need to request a legal proxy from their bank, broker or other nominee in advance of the meeting in order to participate. For more information, see page 77.
Important Notice Regarding the Availability of Proxy Materials for the Shareowner Meeting to be Held on May 5, 2022:2, 2024: The Proxy Statement and our 20212023 Annual Report are available at www.proxyvote.com. Questions? Call 404-828-6059 (option 2).

By order of the Board of Directors

Norman M. Brothers, Jr.

Secretary

Atlanta, Georgia

March 21, 2022

18, 2024

Items of Business

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Items of Business
UNITED PARCEL SERVICE, INC.
2024 Annual Meeting of Shareowners
Voting
Choices
Board Voting
Recommendations
Page
Company Proposals:
1.Elect 1312 director nominees named in the Proxy Statement to serve until the 20232025 Annual Meeting and until their respective successors are elected and qualified

Vote for all nominees

Vote against all nominees

Vote for some nominees and against others

Abstain from voting on one or more nominees

FOR
EACH
NOMINEE
FOR
EACH
NOMINEE
22
2.    Approve, on an advisory basis,Advisory vote to approve named executive officer compensation

Vote for the resolution

proposal

Vote against the resolution

proposal

Abstain from voting on the resolution

proposal
FORFOR56
3.Ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for 20222024

Vote for ratification

Vote against ratification

Abstain from voting on ratification

the proposal
FORFOR59
Shareowner Proposals:
4. - 9.6. Advisory votes on 63 shareowner proposals, only if properly presented

Vote for each proposal

Vote against each proposal

Abstain from voting on theone or more proposals

AGAINST
EACH
PROPOSAL
AGAINST
EACH
PROPOSAL
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Notice of Annual Meeting of Shareowners and 2024 Proxy Statement



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Proxy Statement
UNITED PARCEL SERVICE, INC.

55 Glenlake Parkway, N.E., Atlanta, Georgia 30328

This Proxy Statement contains important information about the 20222024 Annual Meeting of Shareowners (the “Annual Meeting”). We are providing these proxy materials to you because our Board of Directors is soliciting your proxy to vote your shares at the Annual Meeting. The Annual Meeting will be held online onlyvia webcast on May 5, 2022,2, 2024, at 8:00 a.m. Eastern Time, at www.virtualshareholdermeeting.com/ UPS2022.UPS2024. Shareowners can participate, ask questions vote and examine our shareowner listvote during the meeting through this website.

All properly executed written proxies, and all properly completed proxies submitted through the Internet or by telephone, that are delivered pursuant to this solicitation will be voted at the Annual Meeting in accordance with the directions given in the proxy, unless the proxy is revoked prior to the completion of voting at the meeting.Annual Meeting. Only owners of record of shares of the Company’s common stock as of the close of business on March 9, 20225, 2024 (the “Record Date”) are entitled to notice of, and to vote at, the Annual Meeting (or any adjournment or postponement of the Annual Meeting). We are first mailing this Proxy Statement on or about March 21, 2022.

18, 2024.

Proxy Statement Summary

This

The following summary highlights key information contained elsewhere in this Proxy Statement.

Corporate Governance

Following are some

Corporate Governance
Some of our key governance policies and practices:

We maintain a diverse and independent board; practices include:
An independent board; all our directors are independent, other than our Chief Executive Officer (“CEO”); an independent Board Chair who is highly engaged and experienced;
A diverse board, with 42% of the board being female and 33% of the board being ethnically diverse;
Executive sessions of our independent directors held at each board meeting;
Annual elections for all directors; majority voting in uncontested director elections;
Full board engagement in the strategic planning process, including an in-depth annual strategy review and overseeing progress throughout the year;
A Risk Committee consisting entirely of independent members that is responsible for oversight of enterprise risks, including cybersecurity risks;
Regular evaluations of governance policies and practices, making changes when appropriate; including recently delegating additional cybersecurity oversight responsibilities to the Risk Committee, delegating environmental sustainability oversight responsibilities to the Nominating and Corporate Governance Committee, delegating additional human capital oversight responsibilities to the Compensation and Human Capital Committee, and adopting a director overboarding policy;
Regular engagement with stakeholders on environmental, social and governance (“ESG”) matters; during this proxy season management contacted holders of over 47% of our class B common stock to discuss our sustainability goals and initiatives, commitments to diversity and inclusion, and executive compensation matters;
Annual board and committee self-evaluations, including one-on-one director discussions with the independent Board Chair;
Comprehensive director orientation and education program;
Robust stock ownership guidelines, including a target ownership of eight times annual salary for the CEO, five times annual salary for other executive officers and five times the annual retainer for directors; and
Restrictions on executive officers and directors hedging or pledging their ownership in UPS stock.
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2024 Director Nominees
Highlights
92% Independent
61.6 years Average age
8.9 years Average tenure
42% Female
33% Ethnically diverse
Summary information about our director nominees is below. As a group, we believe our 12 director nominees have the appropriate skills and experience to effectively oversee and constructively challenge management’s performance in the execution of our strategy. For more information about our director nominees see page 21.
NameDirector
Since
Principal OccupationCommittee(s)
Independent Directors
Rodney Adkins2013Former Senior Vice President, International Business Machines Corporation
Risk (Chair)
Compensation and Human Capital
Executive
Eva Boratto2020Chief Financial Officer, Bath & Body Works, Inc.
Audit (Chair)
Michael Burns2005Former Chairman, President and Chief Executive Officer, (“CEO”);Dana Incorporated
Audit
Wayne Hewett2020We have an independent Board Chair who is highly engaged and experienced;Senior Advisor to Permira
Audit
Angela Hwang2020Our independent directors meet in executive sessions without management at each board meeting;Former Chief Commercial Officer and President, Pfizer Biopharmaceuticals Business, Pfizer, Inc.
Audit
Kate Johnson2020We hold annual elections for all directors;President and we provide for majority voting in uncontested director elections;Chief Executive Officer, Lumen Technologies, Inc.
Nominating and Corporate Governance
Risk
William Johnson(1)
2009The board is fully engaged in the strategic planning process, conducting an in-depth annual strategy reviewFormer Chairman, President and overseeing progress throughout the year;Chief Executive Officer, H.J. Heinz Company
Nominating and Corporate Governance (Chair)
Executive
Franck Moison2017The board’s Risk Committee consists entirely of independent board membersFormer Vice Chairman, Colgate-Palmolive Company
Nominating and is responsible for overseeing the identification and evaluation of enterprise risks;Corporate Governance
Risk
Christiana Smith Shi2018We regularly evaluate our governance policies and practices, and make changes when appropriate; including recently separating the Chair and CEO roles, providing our shareowners with an annual say on pay vote, and delegating additional human capital oversight responsibilities to the Former President, Direct-to-Consumer, Nike, Inc.
Compensation and Human Capital Committee;(Chair)
Risk
Russell Stokes2020We regularly engage with stakeholders on environmental, socialPresident and governance (“ESG”) matters, for example during this proxy season management contacted holders of over 47% of our class B common stock to discuss sustainability initiatives, our commitments to social justiceChief Executive Officer, Commercial Engines and executive compensation matters;Services, GE Aerospace
Compensation and Human Capital
Nominating and Corporate Governance
Kevin Warsh2012We maintain robust stock ownership guidelines, including a target ownershipFormer Member of eight times annual salary for the CEO, five times annual salary for other executive officersBoard of Governors of the Federal Reserve System, Distinguished Visiting Fellow, Hoover Institution, Stanford University
Compensation and five times the annual retainer for directors;Human Capital
Nominating and Corporate Governance
Non-Independent Director
Carol ToméWe prohibit our executive officers and directors from hedging or pledging their ownership in 2003UPS stock.Chief Executive Officer
Executive (Chair)
(1)Independent Board Chair
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Proxy Statement Summary

Our Board

Our independent Board of Directors is responsible for the strategic oversight of UPS. A summary of their relevant skills, experience and diversity is below. For more information, see page 22.

Our directors’ broad professional skills and experiences contribute to a wide range of perspectives in the boardroom

Diversity in our boardroom supports UPS’s continued success

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Election of Directors

As a group, our 13 director nominees are appropriately skilled and experienced to effectively oversee and constructively challenge the performance of management in the execution of our strategy.

The board recommends you vote FOR each director nominee listed below. For more information, see page 22.

Name     Age     Director
Since
     Occupation     Committee(s)     Other Public
Company
Boards
Independent Directors    
Rodney Adkins 63 2013 Former Senior Vice President, International Business Machines Corporation 

Risk (Chair)

Compensation and Human Capital

 3
Eva Boratto 55 2020 Chief Financial Officer, Opentrons Labworks, Inc.  Audit (Chair) 0
Michael Burns 70 2005 Former Chairman, President and Chief Executive Officer, Dana Incorporated  Audit 0
Wayne Hewett 57 2020 Senior Advisor to Permira, and Chairman of Cambrex Corporation  Audit 2
Angela Hwang 56 2020 Group President, Pfizer Biopharmaceuticals Group, Pfizer, Inc.  Audit 0
Kate Johnson 54 2020 Former President, Microsoft U.S., Microsoft Corporation 

Nominating and Corporate Governance

Risk

 0
William Johnson(1) 73 2009 Former Chairman, President and Chief Executive Officer, H.J. Heinz Company 

Nominating and Corporate Governance (Chair)

Executive

 1
Ann Livermore 63 1997 Former Executive Vice President, HP Inc. 

Compensation and Human Capital (Chair)

Risk

Executive

 3
Franck Moison 68 2017 Former Vice Chairman, Colgate-Palmolive Company 

Nominating and Corporate Governance

Risk

 1
Christiana Smith Shi 62 2018 Former President, Direct-to-Consumer, Nike, Inc. 

Compensation and Human Capital

Risk

 1
Russell Stokes 50 2020 President and Chief Executive Officer, GE Aviation Services 

Compensation and Human Capital

Nominating and Corporate Governance

 0
Kevin Warsh 51 2012 Former Member of the Board of Governors of the Federal Reserve System, Distinguished Visiting Fellow, Hoover Institution, Stanford University 

Compensation and Human Capital

Nominating and Corporate Governance

 1
Non-Independent Director    
Carol Tomé 65 2003 Chief Executive Officer  Executive (Chair) 1
(1)Independent Board Chair.Executive Compensation
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Proxy Statement Summary

Executive Compensation

Compensation Practices

A significant portion of executive compensation is at-risk and tied to Company performance. This alignshelps align executive decision-making with the long-term interests of our shareowners. We also have a longstanding owner-manager culture. Our compensationCompensation practices that support these principles include:

Payments with a balanced mix of cash and equity, providing a degree of financial certainty and appropriate incentives to retain and motivate executives;
Annual and long-term performance incentive awards in the form of equity grants containing vesting requirements beyond the performance period, furthering both retention and incentive goals;
Annual and long-term performance incentive award payouts that are dependent upon the achievement of multiple distinct goals, avoiding overemphasis on any one metric and mitigating excessive risk-taking;
Long-term performance incentive awards with a three-year performance period;
Stock option awards that vest over a five-year period and only provide value if our stock price increases;
Incentive compensation plans that include clawback provisions that permit recovery of awards granted to executive officers;
Incentive compensation plan awards require a “double trigger” — both a change in control and a termination of employment — to accelerate vesting; and
No tax gross-ups on equity awards or golden parachute excise taxes.

2021

A balanced mix of cash and equity, providing a degree of financial certainty and appropriate incentives to retain and motivate executives;
Performance incentive equity awards which vest over multiple years, furthering both retention and incentive goals;
Multiple distinct goals for annual and long-term performance incentive awards, avoiding overemphasis on any one metric and mitigating excessive risk-taking;
Long-term performance incentive awards with a three-year performance period;
Stock option awards that vest over a five-year period and only provide value if our stock price increases;
Clawback policy that applies to all of our executive officers;
Incentive compensation plan awards require a “double trigger” — both a change in control and a termination of employment or a failure to continue, assume or substitute the award — to accelerate vesting; and
No tax gross-ups on equity awards or golden parachute excise taxes.
2023 Compensation Actions

Key 20212023 compensation decisions affecting our executive officers included:

Most total direct compensation was performance-based or considered “at risk” (93% for the CEO and 86% for all other named executive officers (“NEOs”) as a group), page 34;
Base salary increases as a result of the annual salary review process and pay mix redesign, page 36;
Pay mix redesign to better align annual incentive pay with market practices, improve the competitiveness of base salaries and simplify compensation design, page 36;
A bifurcated performance period for the annual incentive awards in light of continued economic uncertainty and our then-labor uncertainty; beginning with the 2024 performance period, the Compensation and Human Capital Committee has returned to annual goal setting for annual incentive awards, page 37;
Annual incentive awards were earned and paid below target, page 37; and
Previously granted 2021 Long-Term Incentive Performance (“LTIP”) awards, which had three-year performance goals ending in 2023, were earned and paid below target, page 40.
Most total direct compensation was performance-based and considered “at risk” (90% for the CEO and 85% for all other named executive officers (“NEOs”) as a group). See page 32;
Base salary increases for the NEOs as a result of the annual salary review process. See page 35;
Bifurcating the performance period for the annual incentive awards to account for the uncertainty attributable to the COVID-19 pandemic. See page 35;
Annual incentive awards for all NEOs were earned above target. See page 37; and
Previously granted 2019 Long-Term Incentive Performance (“LTIP”) awards, which had three-year performance goals ending in 2021, were earned above target. See page 39.
Say on Pay Vote

Annual Say on Pay Vote

We maintain executive compensation programs that support the long-term interests of our shareowners. We provide shareowners the opportunity to vote annually, on an advisory basis, to approve the compensation of our NEOs, as described in the Compensation Discussion and Analysis section and in the compensation tables and accompanying narrative disclosure in this proxy statement.Proxy Statement. For more information, see page 56.

62.

The board recommends you vote FORthe advisory vote to approve named executive officerNEO compensation.

Ratification

Ratify the Appointment of the Independent Registered Public Accounting Firm
The Audit Committee of the Appointment of the Independent Registered Public Accounting Firm

The Board of Directors has appointed Deloitte & Touche LLP as our independent registered public accounting firm for the year ending December 31, 2022.2024. The board recommends you vote FORthe ratification of the appointment of Deloitte & Touche LLP. For more information, see page 59.

Shareowner Proposals

The65.

Shareowner Proposals
For the reasons described in this Proxy Statement, the board recommends you vote AGAINSTthe shareowner proposals. More informationInformation about these proposals starts on page 62.

68.
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Corporate Governance
The Board of Contents

Corporate Governance

We maintain robustDirectors is accountable to shareowners and operates within a governance policiesstructure that we believe provides appropriate checks and practicesbalances to create long-term value. The board’s responsibilities include:

Establishing an appropriate corporate governance structure;
Supporting and overseeing management in setting long-term strategic goals and applicable measures of value-creation;
Providing oversight on the identification and management of materials risks;
Establishing appropriate executive compensation structures; and
Monitoring business issues that benefithave the potential to significantly impact the Company’s long-term interests of all stakeholders. value.
We regularly review and update our corporate governance policies and practices in response to the evolving needs of our business, shareowner and other stakeholder feedback, regulatory changes, and other corporate developments. Following is an overview of our corporate governance structure and processes, including key aspects of our board operations.

Selecting Director Nominees

Maintaining a board of individuals independent of management, with the appropriate skills and experience, and of the highest personal character, integrity and ethical standards, is critical to the proper functioning of the board. The Nominating and Corporate Governance Committee also seeks to promote diversity in the boardroom with respect to gender, age, ethnicity, skills, experience, perspectives, and other factors.Our directors’ biographies beginning on page 21highlight the factors that the board considered when nominating these individuals.

Nomination Process

1
Nomination Process
1.Board Composition Review
The board’s annual self-evaluation helps the Nominating and Corporate Governance Committee identify needs by assessing areas where additional diversity, perspectives, expertise, skills or experience may be desired. The Nominating and Corporate Governance Committee also conducts regular in-depth board composition reviews.
22.Candidate Identification
The Nominating and Corporate Governance Committee uses a variety of sources to identify a diverse pool of potential candidates. Sources include board members, members of management, independent consultants and shareowner recommendations. Prospective candidates are evaluated after taking into account feedback from consultants, management and board members, candidate background and qualification reviews, and open discussions between the Nominating and Corporate Governance Committee and the full board. This process allows for active and ongoing considerationof potential directors with a focus on long-termCompany strategy.
33.Shortlisted Candidates
The Nominating and Corporate Governance Committee maintains a diverse list of potential director candidates according to desired skills, experiences and backgrounds.The list is reviewed at each Nominating and Corporate Governance Committee meeting and updated as appropriate. Each candidate is evaluated to ensure that existing and planned future commitments would not materially interfere with expected responsibilities to the Company.board responsibilities.
44.Recommendation, Nomination and Annual Election
Candidates recommended by the Nominating and Corporate Governance Committee and approved by the board are nominated for election. Directors are elected annually.
Result:5 new independent directors added since 20202020; 42% director refreshment since 2020.

Shareowner Recommendations, Nominations and Proxy Access

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Shareowner Recommendations
Shareowner recommended director candidates are considered on the same basis as recommendations from other sources. Shareowners can recommend a candidate by writing to the following address: UPS Corporate Secretary, 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328. Submissions must contain the prospective candidate’s name and a detailed description of the experience, qualifications, attributes and skills that make the individual a suitable director candidate.

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Corporate Governance

We also provide proxy access for shareowner director nominees. A single shareowner, or group of up to 20 shareowners, that has owned at least 3 percent of UPS’s outstanding stock continuously for at least three years, may include up to 20 percent of the board seats or two directors (whichever is greater), as director nominees in UPS’s proxy materials for an annual meeting of shareowners. Our Bylaws set forth the requirements for the formal shareowner nomination process for director candidates. These requirements are summarized under “Other Information for Shareowners” on page 82.

Board Diversity

A wide range of viewpoints is critical to effective board deliberations, corporate governance and oversight. Diversity with respect to gender, age, ethnicity, skills, experience, perspectives, and other factors is a key consideration when identifying and recommending director nominees. The Nominating and Corporate Governance Committee assesses board diversity through periodic board composition evaluations. While the Company does not have a formal policy on board diversity, our Corporate Governance Guidelines emphasize diversity, and the Nominating and Corporate Governance Committee actively considers diversity in recruitment and nominations of director candidates.

GenderEthnicityAge
   

Board Refreshment and Succession Planning

 

The Nominating and Corporate Governance Committee regularly considers the long-term makeup of our Board of Directors and how board composition changes over time. They also consider the skills needed on our board as our business evolves. The board seeks to balance the knowledge and experience that comes from longer-term board service with new ideas and perspectives that can come from new directors.

Since 2020, we have added five new directors, and have had four directors retire.

The average tenure of the director nominees reflects an appropriate balance between different perspectives brought by newer and long-serving directors.

Director Independence

Having a significant majority of non-management independent directors encourages robust debate and challenged opinions in the boardroom.

 Our Corporate Governance Guidelines include director independence standards consistent with the New York Stock Exchange (“NYSE”) listing standards. Our Corporate Governance Guidelines are available on the governance section of our investor relations website at www.investors.ups.com.
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The board has evaluated each director’s independence and considered whether there were any relevant relationships between UPS and each director, or any member of his or her immediate family. The board also examined whether there were any relationships between UPS and organizations where a director is or was a partner, principal shareowner or executive officer. Specifically, the board evaluated certain ordinary course business transactions and relationships between UPS and the organizations that currently or in the prior year employed Eva Boratto, Mike Burns, Wayne Hewett, Angela Hwang, Kate Johnson, Russell Stokes and Kevin Warsh, or their immediate family members, as an executive officer. The board also evaluated the ordinary course business transactions and relationships between UPS and any organizations where Rod Adkins, Wayne Hewett, Christiana Smith Shi and Kevin Warsh, or their immediate family members, were a partner or principal shareowner. In each case, no such transactions exceeded the thresholds in UPS’s Corporate Governance Guidelines. The board determined that none of these transactions or relationships were material to the Company, the individuals or the organizations with which they were associated.

The board has determined that each of the director nominees (other than our current CEO, Carol Tomé), is independent. With respect to directors that served during 2021 but have retired, the board has determined that each such individual was independent. All members of the Audit Committee, Compensation and Human Capital Committee, Nominating and Corporate Governance Committee and Risk Committee are independent.

Board Leadership Structure

Based on the periodic evaluation and recommendation of the Nominating and Corporate Governance Committee, the board determines the most appropriate board leadership structure, including who should serve as Board Chair, and whether the roles of Board Chair and CEO should be separated or combined.

In making this determination, the board evaluates a number of factors, including professional experience, operational responsibilities and corporate governance developments.

In October 2020, in connection with Carol Tomé’s election as CEO, the board determined that it was in the best interests of the Company to enable Carol to focus on leading the Company, and separated the roles of Board Chair and CEO. Bill Johnson, who had been serving as our independent Lead Director, was appointed Board Chair on October 1, 2020.

Chair.

Bill has served on our board since 2009 and had served as independent Lead Director since 2016.from 2016 until October 2020. He has deep institutional knowledge of the Company and provides strong continuity of leadership. He devotes significant time to understanding our business and communicating with the CEO, and other directors, between meetings. He draws on his extensive knowledge of our business, industry, strategic priorities and competitive developments to set the board’s agendas in collaboration with the CEO, and he seeks to ensure that board meetings are productive and interactions with the directors facilitate a useful exchange of viewpoints. Bill’s value to the board is underscored by the board’s decision to extend his tenure beyond the board’s mandatory retirement age of 75; in connection with our director nomination process, the board determined to grant Bill a one-year waiver from that requirement so that he can continue to lead the board.
Carol is available to all directors between meetings and meets regularly with the Board Chair, and with the directors individually and as a group, to receive feedback from the board. Bill’s collaboration with Carol allows the board to focus attention on the issues of greatest importance to the Company and its shareowners and our CEO to focus primarily on leading the Company.

Furthermore, all the members of each of the Audit Committee, the Compensation and Human Capital Committee, the Nominating and Corporate Governance Committee and the Risk Committee are independent. Each committee is led by a chairperson who sets the meeting agendas and reports to the full board on the committee’s work. Additionally, the independent directors meet in executive session without management present at each board meeting, as described below.

Executive Sessions of Independent Directors

Directors hold executive sessions without management present at each regular board meeting. The Board Chair determines the agenda and presides at each session. The Board Chair generally invites the CEO to join a portion of the executive session to receive feedback from the board and when deemed appropriate otherwise. In addition, duringthroughout the year the Board Chair meets individually with each director to discuss issues that are important to the board and to solicit and provide further feedback.

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Board and Committee Evaluations

The board’s performance is critical to our long-term success and the protection of stakeholders’ interests. The board employs both an ongoing informal and a formal annual process to evaluate its performance and the contributions of individual directors to the successful execution of the board’s obligations. The Board Chair frequently considers the performance of the board and the board’s committees and has informal discussions about individual director contributions to the board. The Board Chair shares feedback from these discussions with the full board and with individual board members. In addition, during 20212023 the CEOBoard Chair met individually with each director to discuss how best to utilize the director’s skillsoverall board effectiveness and experience. The feedback from these meetings was reviewed with the Board Chair.

performance, individual director time commitments and potential 2024 board agenda items.
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Formal Evaluation Process

Table of Contents

Corporate Governance

Formal Evaluation Process

1
1.Detailed Formal Annual Evaluation Process
The Board of Directors, Audit Committee, Compensation and Human Capital Committee, Nominating and Corporate Governance Committee, and Risk Committee each conduct an annual self-assessment. The Nominating and Corporate Governance Committee oversees the annual board assessment process and the implementation of the annual committee self-assessments.
22.Questionnaires
All board and committee members complete a detailed confidential questionnaire each year. The questionnaire provides for quantitative ratings in key areas, including overall board effectiveness, meeting effectiveness, access to information, information format, board committee structure, access to management, succession planning, meeting dialogue, communication with the CEO, operational reporting, financial oversight, capital structure and financing, capital spending, long-term strategic planning, risk oversight, crisis management and time management. The questionnaire also allows directors to provide written feedback and make detailed anonymous comments. In 2023, the Company engaged a new, independent third party to administer and report on the evaluations.
33.Review
The results of the committee self-assessments are reviewed by each committee and discussed with the full board. The Chair of the Nominating and Corporate Governance Committee Chair reviews the results of committee self-assessments and discusses the responses with the chairs of the other board committees as appropriate. The Chair of the Nominating and Corporate Governance Committee Chair also reviews and discusses the board evaluation results with the full board.
44.Follow-up
Matters requiring follow-up are addressed by the Chair of the Nominating and Corporate Governance Committee Chair or the chairs of the other committees as appropriate.
ResultResult:Feedback from thethese evaluations has drivenled to several improvements in board operations over the last few years,functionality in recent periods, including changes to the format and delivery of board meeting materials, board meeting agendas and recurring topics, strategic planning and oversight, director recruitment practices and orientation, allocation of responsibilities among the board’s committees and succession planning.

Majority Voting

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Board Refreshment and Director Resignation Policy

Our Bylaws provide for majority voting in uncontested director elections. Succession

8.9 yearsnominee average tenure
Newer directors (< 5 years) 
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Medium-tenured directors (5-10 years) 
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Longer-tenured directors (> 10 years) 
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The number of votes cast for a nominee must exceed the number of votes cast against that person. Any incumbent director who does not receive a majority of the votes cast must offer to resign from the board.

In such an event, the Nominating and Corporate Governance Committee will recommend to theregularly evaluates board whether to accept or reject the director’s offer to resign after considering all relevant factors.composition and necessary skills as our business evolves over time. We seek a balance of knowledge and experience that comes from longer-term board service with new ideas and perspectives that can come from newer directors. Since 2020, we have added five new directors, and have had four directors retire. The board will act on the recommendation within 90 days following certificationaverage tenure of the election results after considering all relevant information.

Any director who offers to resign must recuse himself or herself from the board vote, unless the number of independent directors who were successful incumbents is fewer than three. The board will promptly disclose its decision regarding any director’s offer to resign, including its reasoning. If the board determines to accept a director’s offer to resign, the Nominatingnominees reflects an appropriate balance between different perspectives brought by newer and Corporate Governance Committee will recommend whether and when to fill such vacancy or whether to reduce the size of the board.

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long-serving directors.

Table of Contents

Risk Oversight

Board Oversight of Risk

Board of Directors

Risk management oversight is an essential board responsibility. The board regularly discusses our most significant risks and how these risks are being managed. The Company’s enterprise risk management process is designed to identify potential events that may affect the achievement of the Company’s objectives or have a material adverse effect on the Company. The board reviews periodic assessments from this process and participates in the Company’s annual risk survey. The board has delegated to its standing committees specific risk oversight responsibilities as set out below and receives regular reports from the committees on appropriate areas of risk management.

Risk CommitteeAudit CommitteeCompensation and Human
Capital Committee
Nominating and Corporate
Governance Committee
Oversees management’s identification and evaluation of strategic enterprise risks, including risks associated with intellectual property, operations, privacy, technology, information security, cybersecurity and cyber incident response, and business continuity.Oversees policies with respect to financial risk assessment, including guidelines to govern the process by which major financial and accounting risk assessment and management is undertaken.Considers risks associated with compensation policies and practices, with respect to both executive compensation and compensation generally, and considers other human capital risks.Considers risks related to governance matters, including succession planning.

Strategic Planning

The Company’s Chief Legal and Compliance Officer, Chief Information Officer, and the Vice President of Compliance and Internal Audit each meet individually with the Risk Committee on a regular basis.

The Risk Committee updates the full board annually on the Company’s enterprise risk management survey and risk assessment results. The board provides feedback to the Company about significant enterprise risks and assesses the Company’s identification of its most significant risk areas. The Risk Committee also coordinates with the Audit Committee to enable the Audit Committee to perform its risk related responsibilities.

The Audit Committee has additional risk assessment and risk oversightboard’s responsibilities specifically with respect to financial risk assessment. The Chief Legal and Compliance Officer, CEO, Chief Financial Officer and Vice President of Compliance and Internal Audit each meet individually with the Audit Committee on a regular basis.

In addition, the Company’s Chief Legal and Compliance Officer reports directly to our CEO, providing visibility into the Company’s risk profile. The board believes that the work undertaken by its committees, together with the work of the full board and the Company’s senior management, enables effectiveinclude oversight of the Company’s management of risk.

Strategic Planning and Oversight

Oversight of strategic planningplanning. Effective oversight requires a high level of constructive engagement between management and the board. The Company maintains a process that allows the board to leverageleverages its substantial experience and expertise to remainand is fully engaged in the Company’s strategic planning process. Management develops and prioritizes strategic plans on an annual basis. Management then reviews these plans with the board on an annual basis, along with the Company’s challenges, opportunities, industry dynamics, and legal, regulatory and governance developments, and other factors.

significant strategic matters.

Management provides the board comprehensive updates throughout the year regarding progress on the Company’s strategic plans. Management also provides regular updates regarding the achievement of the Company’s financial and other goals. In addition, the CEO communicates regularly with the board on important business opportunities, financial and operational performance matters, risks and other developments such as sustainability, human capital, labor and customer relations, both during and outside the regular board meeting cycle.

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Management Development and 2022 Proxy Statement

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Corporate Governance

Management Succession Planning and Development

Succession planning and talent development are important at all levels within our organization. The board oversees management’s emergency and long-term succession plans at the executive officer level, most importantly the CEO position. The board annually reviews succession plans for senior management including the CEO, all in the context of the Company’s overall business strategy and with a focus on risk management. More broadly, the board and the Compensation and Human Capital Committee are regularly updated on key talent indicators for the overall workforce, including diversity, recruiting and development programs.

The board’s succession planning activities are ongoing and strategic and are supported by board committees and independent third-party consultants as needed. In addition, the CEO annually provides an assessment to the board of senior leaders and their potential to succeed at key senior management positions. As a part of this process, potential leaders interact with board members through formal presentations and during informal events.

We also utilize a formal director engagement program in which directors meet with individual executive officers, visit Company operations, participate in employee events and receive in-depth subject matter updates outside of the regular board meeting process. These additional engagements encourage the ongoing exchange of ideas and information between directors and management, facilitate the board’s oversight responsibilities, and support management development and succession planning efforts.

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Risk Oversight
Board of Directors
Risk management oversight is an essential board responsibility. The board regularly discusses our most significant risks and how these risks are being managed. The Company’s enterprise risk management process is designed to identify potential events that may affect the achievement of the Company’s objectives or have a material adverse effect on the Company. The board reviews periodic assessments from this process and participates in the Company’s annual enterprise risk survey. The board has delegated to its standing committees specific risk oversight responsibilities as set out below and receives regular reports from the committees on appropriate areas of risk management.
Risk CommitteeAudit CommitteeCompensation and Human
Capital Committee
Nominating and Corporate
Governance Committee
Oversees management’s identification and evaluation of strategic enterprise risks, including risks associated with intellectual property, operations, privacy, technology, information security, cybersecurity and cyber incident response, and business continuity.Oversees policies with respect to financial risk assessment, including guidelines to govern the process by which major financial and accounting risk assessment and management is undertaken.Considers risks associated with compensation policies and practices, with respect to both executive compensation and compensation generally, and considers other human capital risks.Considers risks related to succession planning, political contributions and lobbying, sustainability and stakeholder engagement matters, among others.
The Company’s Chief Legal and Compliance Officer, Chief Digital and Technology Officer, Chief Information Security Officer, and Vice President of Compliance and Internal Audit each meet individually with the Risk Committee on a regular basis. The Chair of the Risk Committee also meets frequently with the Chief Digital and Technology Officer between meetings.
The Risk Committee updates the board annually on the Company’s enterprise risk management survey and risk assessment results. The board provides feedback to the Company about significant enterprise risks and assesses the Company’s identification of its most significant risk areas. The Risk Committee also coordinates with the Audit Committee, including through periodic joint meetings, to enable the Audit Committee to perform its risk related responsibilities. The Risk Committee oversees the Company’s approach to cybersecurity risk assessment and mitigation by, among other things:
reviewing the Company’s cybersecurity insurance program;
reviewing at least annually the Company’s cybersecurity budget;
discussing the results of various internal cybersecurity audits and periodic independent third-party assessments of the Company’s cybersecurity programs;
being briefed on cybersecurity matters by outside experts; and
receiving regular updates from the Company’s Chief Information Security Officer (“CISO”) and others on cybersecurity risks, operational metrics, compliance and regulatory developments, training programs, risk mitigation activities, key projects and industry developments.
The Company's Chief Legal and Compliance Officer, Chief Digital and Technology Officer, CISO and Vice President of Compliance and Internal Audit participate in Risk Committee meetings and meet individually with the Risk Committee on a periodic basis to discuss and address relevant matters, including the Company’s approach to cybersecurity risk assessment and mitigation.
The Audit Committee has additional risk assessment and risk oversight responsibilities, specifically with respect to financial risk assessment. The Chief Legal and Compliance Officer, CEO, Chief Financial Officer and Vice President of Compliance and Internal Audit each meet individually with the Audit Committee on a regular basis.
In addition, the Company’s Chief Legal and Compliance Officer reports directly to our CEO, providing visibility into the Company’s risk profile. The board believes that the work undertaken by its committees, together with the work of the full board and the Company’s senior management, enables effective oversight of the Company’s management of risk.
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Stakeholder Engagement
Maintaining open and ongoing dialogs with key stakeholders is an important component of our corporate culture. Our management team participates in numerous investor meetings throughout the year to discuss our business, strategy and financial results. This includes in-person, telephone and webcast conferences, as well as key site visits.
In addition, each year we undertake an ESG stakeholder outreach program in which we discuss progress on our ESG journey. This year we contacted holders of over 47% of our class B common stock as a part of this program. Engagement provides us with the opportunity to understand issues of significant importance to stakeholders and to receive feedback on our practices and disclosures. Similarly, it provides us with an opportunity to discuss how management believes its actions are aligned with long-term value creation.
We also proactively correspond with other key stakeholders throughout the year. We share feedback from our financial and ESG engagements with the board, the Compensation and Human Capital Committee, and the Nominating and Corporate Governance Committee as appropriate.
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We consider the views of our shareowners and other stakeholders when evaluating our ESG policies and practices; for example, in recent years we have:The Compensation and Human Capital Committee considers shareowner feedback, along with the market information and analysis provided by its independent compensation consultant, when making decisions about our executive compensation programs. We have:
Announced a number of environmental, social and human capital goals, including a carbon neutral by 2050 goal;
Accelerated our sustainability reporting;
Increased disclosures around individual director racial, ethnic and gender diversity;
Increased our commitments to diversity, equity and inclusion, volunteerism and charitable giving;
Separated the Board Chair and CEO roles;
Appointed an independent Board Chair;
Increased board diversity;
Expanded reporting on lobbying activities;
Revised the Risk Committee charter to specifically identify cybersecurity oversight responsibilities;
Revised the Nominating and Corporate Governance Committee charter to include oversight of environmental sustainability matters and risks; and
Revised the Compensation and Human Capital Committee charter to include oversight of performance and talent management, diversity, equity and inclusion, work culture and employee development and retention.
Updated the peer group for executive and director compensation market comparisons;
Enhanced the competitiveness of our performance-based annual compensation program;
Eliminated single-trigger equity vesting following a change in control;
Added relative total shareowner return as a component of our Long-Term Incentive Plan awards;
Reevaluated performance metrics under incentive compensation plans for proper design to incent towards long-term Company value creation;
Provided additional detail around the performance measures used for our annual and long-term incentive plans;
Adopted a mandatory incentive compensation clawback policy applicable to executive officers;
Approved the return to a single, annual goal setting process for annual incentive program design; and
Added an individual payout cap to our annual incentive plan.
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Political Engagement
Overview
Responsible participation in the political process is important to our success and the protection and creation of shareowner value. We participate in this process in accordance with good corporate governance practices. Our Political Engagement Policy (“policy”) is summarized below and is available at www.investors.ups.com. In addition, as a component of our ongoing governance evaluation process, we recently expanded our reporting around lobbying and trade association memberships.
The Nominating and Corporate Governance Committee oversees the policy;
Corporate political contributions are restricted;
We publish a semi-annual political engagement report on our investor relations website; and
Eligible employees can make political contributions through a Company-sponsored political action committee (“UPSPAC”). UPSPAC is organized and operated on a voluntary, nonpartisan basis and is registered with the Federal Election Commission.
Oversight and Processes
Political contributions are made in a legal, ethical and transparent manner that best represents the interests of stakeholders. Political and lobbying activities require prior approval of the UPS Public Affairs department and are subject to review (and in some cases prior approval) by the Nominating and Corporate Governance Committee.
Senior management works with Public Affairs on furthering our business objectives and protecting and enhancing shareowner value. The Chief Corporate Affairs and Sustainability Officer reviews political and lobbying activities and regularly reports to the board and the Nominating and Corporate Governance Committee.
Lobbying and Trade Associations
Public Affairs coordinates our lobbying activities, including engagements with federal, state, and local governments. UPS is also a member of a variety of trade associations that engage in lobbying. Lobbying activities require prior approval of Public Affairs.
The Nominating and Corporate Governance Committee regularly reviews UPS’s participation in trade associations that engage in lobbying to determine if our involvement is consistent with UPS business objectives and whether participation exposes the Company to excessive risk.
Lobbying activities are governed by comprehensive policies and practices designed to facilitate compliance with laws and regulations, including those relating to the lobbying of government officials, the duty to track and report lobbying activities, and the obligation to treat lobbying costs and expenses as nondeductible for tax purposes.
Political Activity Transparency
We believe in transparency in our political activities. We publish semi-annual political engagement reports, which are reviewed and approved by the Nominating and Corporate Governance Committee. The reports provide:
Amounts and recipients of any federal and state Company political contributions in the U.S. (if any such expenditures are made);
The names of trade associations that receive $50,000 or more and that use a portion of the payment for political contributions; and
The names of trade associations or other organizations that draft model legislation that received $25,000 or more in membership dues from UPS in a given year, and the percentage of dues used for lobbying purposes. These disclosures were recently added as a governance enhancement based on stakeholder feedback.
Our most recent report is available on our investor relations website at www.investors.ups.com. We also publicly file a federal Lobbying Disclosure Act Report each quarter, providing information on activities associated with influencing legislation through communications with any member or employee of a legislative body, or with any covered executive branch official. This report discloses expenditures for the quarter, describes the specific pieces of legislation that were the topic of communications, and identifies the individuals who lobbied on behalf of UPS. We file similar publicly available periodic reports with state agencies reflecting state lobbying activities.
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Sustainability
We are the world’s premier package delivery company and a leading provider of global supply chain management solutions. We offer a broad range of industry-leading products and services through our extensive global presence. Our services include transportation and delivery, distribution, contract logistics, ocean freight, air freight, customs brokerage and insurance.
We operate one of the largest airlines and one of the largest fleets of alternative fuel vehicles under a global UPS brand that stands for quality and reliability. We deliver packages each business day for approximately 1.6 million shipping customers to 10.2 million delivery recipients in over 200 countries and territories. In 2023, we delivered an average of 22.3 million packages per day, totaling 5.7 billion packages during the year. Our success depends on economic stability, global trade and a society that welcomes opportunity. We understand the importance of acting responsibly as a business, an employer and a corporate citizen.
The board considers key economic, environmental and social sustainability risks and opportunities as part of its involvement in and oversight of UPS’s strategic planning. The board also regularly reviews the effectiveness of our risk management and due diligence processes related to material sustainability topics. In executing its responsibilities, the board recently delegated oversight of environmental sustainability matters to the Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee monitors the development, implementation, and progress of the Company’s environmental sustainability goals and regularly reports on those matters to the board. Authority for day-to-day management of sustainability matters has been delegated to management. Our Chief Corporate Affairs and Sustainability Officer reports directly to the Company’s CEO and regularly reports to the board regarding sustainability strategies, priorities, goals and performance. In addition, the board is regularly briefed on issues of concern for customers, unions, employees, retirees, investors, governmental entities and other stakeholders. For additional information on board oversight, see page 14.
Each year we publish corporate sustainability reports showcasing the goals, recent achievements and challenges of our commitment to balancing the economic, environmental and social aspects of our business. In response to stakeholder interest, we have recently accelerated the timing of these reports to provide stakeholders with more current information in advance of our Annual Meeting. These reports are available at https://about.ups.com/us/en/social-impact/reporting.html. Our sustainability goals are aspirational and may change. Statements regarding our goals are not guarantees or promises that they will be met.
Human Capital Management
Our success is dependent upon our people, working together with a common purpose. As we seek to capture new opportunities and pursue growth, we believe that transforming the UPS employee experience is foundational to our success. This requires a thoughtful balance between the culture we have cultivated over the years and the new perspectives we need to take the business into the future. We believe that UPS employees are among the most motivated and highest-performing in the industry, and provide us a competitive advantage. To assist with employee recruitment and retention, we continue to review the competitiveness of our employee value proposition, including benefits and pay, training, talent development and promotion opportunities.
We have approximately 500,000 employees (excluding temporary seasonal employees), of which 414,000 are in the U.S. and 86,000 are located internationally. Our global workforce includes approximately 85,000 management employees (42% of whom are part-time) and 415,000 hourly employees (48% of whom are part-time). More than 70% of our U.S. employees are represented by unions, primarily those employees handling or transporting packages. Many of these employees are employed under a national master agreement and various supplemental agreements with local unions affiliated with the International Brotherhood of Teamsters ("Teamsters"). In the third quarter of 2023, the Teamsters fully ratified a new national master agreement that expires July 31, 2028. In addition, approximately 3,300 of our pilots are represented by the Independent Pilots Association (“IPA”). Our agreement with the IPA becomes amendable September 1, 2025.
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Oversight and management
We seek to create an inclusive and equitable environment that brings together a broad spectrum of backgrounds, cultures and stakeholders. We believe leveraging diverse perspectives and creating inclusive environments improves our organizational effectiveness, cultivates innovation, and drives growth.
Our board, directly and through the Compensation and Human Capital Committee, is responsible for oversight of human capital matters. Effective oversight is accomplished through a variety of methods and processes including regular updates and discussions around human capital transformation efforts, technology initiatives impacting the workforce, health and safety matters, employee survey results related to culture and other matters, hiring and retention, employee demographics, labor relations and contract negotiations, compensation and benefits, succession planning and employee training initiatives.
In addition, the Compensation and Human Capital Committee charter has been expanded to include oversight responsibility for performance and talent management, diversity, equity and inclusion, work culture and employee development and retention. We believe the board’s oversight of these matters helps identify and mitigate exposure to labor and human capital management risks, and is part of the broader framework that guides how we attract, retain and develop a workforce that aligns with our values and strategies.
Total rewards
We offer competitive compensation and benefits. In addition, our long history of employee stock ownership aligns the interests of our management team with shareowners. In the U.S., benefits provided to our non-union employees typically include:
comprehensive health insurance coverage;
life insurance;
short- and long-term disability coverage;
child/elder care spending accounts;
work-life balance programs;
an employee assistance program; and
a discounted employee stock purchase plan.
We invest in our people by offering a range of other benefits, such as paid time off, retirement plans, and education assistance. In the U.S., these other benefits are generally provided to non-union employees without regard to full-time or part-time status.
Employee health and safety
We seek to provide industry-leading employee health, safety and wellness programs across our workforce. UPS's Comprehensive Health and Safety Program ("CHSP") is an occupational health and safety system tailored to our varied operational environments. Our CHSP covers a wide array of roles, from package handling to administration, and spans geographical boundaries to include sorting facilities, mobile logistics, administrative offices, and other locations worldwide. UPS conducts audits to assess specific risks and hazards, including equipment safety, workplace environment, and emergency response protocols. We monitor our safety performance through various measurable targets, including lost time injury frequency and the number of recorded auto accidents.
Collective bargaining
We bargain in good faith with the unions that represent our employees. We frequently engage union leaders at the national level and at local chapters throughout the U.S. We participate in works councils and associations outside the U.S., which allows us to respond to emerging issues abroad. This work helps our operations to build and maintain productive relationships with our employees. For additional information on the union membership of our employees, see “Human Capital Management” above.
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Majority Voting and Director Resignation Policy
Our Bylaws provide for majority voting in uncontested director elections. The number of votes cast for a nominee must exceed the number of votes cast against that person. Any incumbent director who does not receive a majority of the votes cast must offer to resign from the board.
In such an event, the Nominating and Corporate Governance Committee will recommend to the board whether to accept or reject the director’s offer to resign after considering all relevant factors. The board will act on the recommendation within 90 days following certification of the election results after considering all relevant information.
Any director who offers to resign must recuse himself or herself from the board vote, unless the number of independent directors who were successful incumbents is fewer than three. The board will promptly disclose its decision regarding any director’s offer to resign, including its reasoning. If the board determines to accept a director’s offer to resign, the Nominating and Corporate Governance Committee will recommend whether and when to fill such vacancy or whether to reduce the size of the board.
Board Meetings and Attendance

The board held fiveseven meetings during 2021.2023. Also during 2021,2023, the Audit Committee met tennine times, the Compensation and Human Capital Committee met fivesix times, the Nominating and Corporate Governance Committee met four times and the Risk Committee met three times. The Executive Committee met one time in 2021.four times (including a joint meeting with the Audit Committee). Prior to board meetings, the Board Chair and the board’s committee chairs work with management to determine and prepare agendas for the meetings.
Board meetings generally occur over two days. Board committees generally meet on the first day, of the board meeting, followed by the board meeting. The second day typically consists of reports from each committee chair to the full board, additional presentations by internal business leaders or others with expertise in various subject matters, and an executive session consisting of only independent board members. The executive sessions are chaired by our Board Chair.

All directors attended 100%at least 75% of the total number of board and any committee meetings of which he or she was a member in 2021.2023. Our directors are expected to attend each annual shareowner meeting, and all directors who were then members of the board attended the 20212023 Annual Meeting. The independent directors met in executive session at all the board meetings held in 2021.

2023.

Code of Business Conduct

We are committed to conducting our business in accordance with the highest ethical principles. Our Code of Business Conduct is applicable to anyone who represents UPS, including our directors, executive officers and all other employees and agents of UPS. A copy of our Code of Business Conduct is available on our investor relations website at www.investors.ups.com.

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Conflicts of Interest and Related Person Transactions

Our Audit Committee is responsible for overseeing our Code of Business Conduct, which includes policies regarding conflicts of interest. The Code requires employees and directors to avoid conflicts of interest, defined as situations where the person’s private interests conflict, or may appear to conflict, with the interests of UPS.

We maintain a written related person transactions policy that applies to any transaction or series of transactions in which: (1) the Company or any of its subsidiaries is a participant; (2) any “related person” (executive officer, director, greater than 5% beneficial owner of the Company’s common stock, or an immediate family member of any of the foregoing) has or will have a material direct or indirect interest; and (3) the aggregate amount involved since the beginning of the Company’s last completed fiscal year will exceed or may reasonably be expected to exceed $100,000.

The policy provides that related person transactions that may arise during the year are subject to the Audit Committee’s reasonable prior approval. If advance approval of a related person transaction is not possible, then the transaction will be considered and, if deemed appropriate, ratified no later than the Audit Committee’s next regularly scheduled meeting. In determining whether to approve or ratify a transaction, the Audit Committee will
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consider, among other factors it deems appropriate, whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third-party under the same or similar circumstance, the extent of the related person’s interest in the transaction, whether the transaction would impair independence of a non-employee director and whether there is a business reason for UPS to enter into the transaction. A copy of the policy is available on our investor relations website at www.investors.ups.com. The Company did not engage in any related person transactions since January 1, 20212023 that require disclosure in this Proxy Statement or under the Company’s policy.

At least annually, each director and executive officer completes a questionnaire in which they are required to disclose any business relationships that may give rise to a conflict of interest, including transactions where UPS is involved and where an executive officer, a director or a related person has a direct or indirect material interest. We also review the Company’s financial systems and any related person transactions to identify potential conflicts of interest. The Nominating and Corporate Governance Committee reviews a summary of this information and makes recommendations to the Board of Directors regarding each board member’s independence.
We have immaterial ordinary course of business transactions and relationships with companies with which our directors are associated. The Nominating and Corporate Governance Committee reviewed the transactions and relationships that occurred since January 1, 20212023 and believes they were entered into on terms that are both reasonable and competitive and did not affect director independence. Additional transactions and relationships of this nature may be expected to take place in the ordinary course of business in the future.

Transactions in Company Stock

We prohibit our executive officers and directors from hedging or pledging their ownership in UPS stock. Specifically, they are prohibited from purchasing or selling derivative securities relating to UPS stock and from purchasing financial instruments that are designed to hedge or offset any decrease in the market value of UPS securities. Furthermore, our employees, officers and directors are prohibited from engaging in short sales of UPS stock.

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Corporate Governance

Stakeholder Engagement

Maintaining open Guidelines and honest dialogs with our stakeholders is an important componentCommittee Charters

Our Corporate Governance Guidelines and the charters for each of our corporate culture. Our management team participates in numerous investor meetings throughout the year to discuss our business, strategy and financial results. This includes in-person, telephone and webcast conferences, as well as key site visits. Our Investor Relations team shares feedback and provides regular updates to the board on investor sentiment.

In addition, each year we undertake an Environmental, Social and Governance (“ESG”) stakeholder outreach program in which we discuss progressboard’s committees are available on our ESG journey. This year we contacted holders of over 47% of our class B common stock as a part of this program.

We also proactively correspond with other key stakeholders throughout the year. We share feedback from these engagements with the board, the Compensation and Human Capital Committee, andinvestor relations website at www.investors.ups.com. Each committee reviews its charter annually. In addition, the Nominating and Corporate Governance Committee as appropriate.

We consider the views of our shareowners and other stakeholders when evaluating our ESG policies and practices; for example, in recent years we have:The Compensation and Human Capital Committee considers shareowner feedback, along with the market information and analysis provided by its independent compensation consultant, when making decisions about our executive compensation programs. We have:
reviews our Corporate Governance Guidelines annually and recommends any changes to the board for approval. When amending our committee charters or Corporate Governance Guidelines, we consider current governance trends and best practices, changes in regulatory requirements, advice from outside sources and input from stakeholders.
Announced a carbon neutral by 2050 goal, including several shorter and medium term goals;
Expanded our sustainability disclosure, including publishing GRI, TCFD and SASB reports;
Increased our commitments to diversity, equity and inclusion, volunteerism and charitable giving;
Separated the Board Chair and CEO roles;
Appointed an independent Board Chair;
Increased board diversity;
Adopted policies providing for an annual say on pay vote;
Adopted proxy access; and
Revised the Compensation and Human Capital Committee charter to include oversight of performance and talent management, diversity, equity and inclusion, work culture and employee development and retention.
Updated the peer group used by the Committee for executive and director compensation market comparisons;
Enhanced the performance-based equity component in our compensation programs;
Eliminated single-trigger equity vesting following a change in control;
Added relative total shareowner return as a component of our Long-Term Incentive Plan awards;
Adopted performance metrics under incentive compensation plans better designed to tie payouts to increases in shareholder value;
Provided additional detail around the performance measures used for our annual and long-term incentive plans;
Eliminated tax gross-ups;
Entered into protective covenant agreements in favor of UPS with certain executive officers; and
Added an individual payout cap to our annual incentive plan.

Communicating with the Board of Directors

Stakeholders may communicate directly with the board, with the non-management directors as a group, or with any specific director, by writing to the UPS Corporate Secretary, 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328. Please specify to whom your letter should be directed. After review by the Corporate Secretary, appropriate communications will be forwarded to the addressee. Advertisements, solicitations for business, requests for employment, requests for contributions, matters that may be better addressed by management or other inappropriate materials will not be forwarded.

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Table of Contents

Political Contributions and Lobbying

Overview

Responsible participation in the political process is important to our success and the protection of shareowner value. We participate in this process in accordance with good corporate governance practices. Our Political Contributions and Lobbying Policy (“policy”) is summarized below and is available at www.investors.ups.com.

The Nominating and Corporate Governance Committee oversees the policy;
Corporate political contributions are restricted;
We publish a semi-annual political contribution report on our investor relations website; and
Eligible employees can make political contributions through a Company-sponsored political action committee (UPSPAC). UPSPAC is organized and operated on a voluntary, nonpartisan basis and is registered with the Federal Election Commission.

Oversight and Processes

Political contributions are made in a legal, ethical and transparent manner that best represents the interests of stakeholders.
Political and lobbying activities require prior approval of the UPS Public Affairs department and are subject to review (and in some cases prior approval) by the Nominating and Corporate Governance Committee.
Senior management works with Public Affairs on furthering our business objectives and protecting and enhancing shareowner value.
The Chief Corporate Affairs Officer reviews political and lobbying activities and regularly reports to the board and the Nominating and Corporate Governance Committee.

Lobbying and Trade Associations

Public Affairs coordinates our lobbying activities, including engagements with federal, state, and local governments. UPS is also a member of a variety of trade associations and other tax-exempt organizations that engage in lobbying.
Lobbying activities require prior approval of Public Affairs.
The Nominating and Corporate Governance Committee regularly reviews UPS’s participation in trade associations and other tax-exempt organizations that engage in lobbying to determine if our involvement is consistent with UPS business objectives and whether participation exposes the Company to excessive risk.
Lobbying activities are governed by comprehensive policies and practices designed to facilitate compliance with laws and regulations, including those relating to the lobbying of government officials, the duty to track and report lobbying activities, and the obligation to treat lobbying costs and expenses as nondeductible for tax purposes.

Political Activity Transparency

We are transparent in our political activities.
We publish a semi-annual report, which is reviewed and approved by the Nominating and Corporate Governance Committee.
The report provides:
Amounts and recipients of any federal and state political contributions in the United States (if any such expenditures are made); and
Payments to trade associations that receive $50,000 or more and that use a portion of the payment for political contributions, as reported by the trade association to us.
The report is available on our investor relations website at www.investors.ups.com
We also publicly file a federal Lobbying Disclosure Act Report each quarter, providing information on activities associated with influencing legislation through communications with any member or employee of a legislative body, or with any covered executive branch official. This report discloses expenditures for the quarter, describes the specific pieces of legislation that were the topic of communications, and identifies the individuals who lobbied on behalf of UPS. UPS files similar publicly available periodic reports with state agencies reflecting state lobbying activities.
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Corporate Governance

Sustainability

We are the world’s premier package delivery company and a leading provider of global supply chain management solutions. We offer a broad range of industry-leading products and services through our extensive presence in North America; Europe; the Indian sub-continent, Middle East and Africa (“ISMEA”); Asia Pacific and Latin America. Our services include transportation and delivery, distribution, contract logistics, ocean freight, air freight, customs brokerage and insurance.

We operate one of the largest airlines and one of the largest fleets of alternative fuel vehicles under a global UPS brand that stands for quality and reliability. We deliver packages each business day for approximately 1.7 million shipping customers to 11.8 million delivery customers in over 220 countries and territories. In 2021, we delivered an average of 25.2 million packages per day, totaling 6.4 billion packages during the year. Our success depends on economic stability, global trade and a society that welcomes opportunity. We understand the importance of acting responsibly as a business, an employer and a corporate citizen.

Economic, environmental and social sustainability risks and opportunities are considered as part of our comprehensive enterprise risk management program. The board regularly reviews the effectiveness of our risk management and due diligence processes related to material sustainability topics. In addition, the board actively considers these factors in connection with the board’s involvement in UPS’s strategic planning process. The board delegates authority for day-to-day management of sustainability topics to management. Our Chief Corporate Affairs Officer reports directly to the Company’s CEO and regularly reports to the board regarding sustainability strategies, priorities, goals and performance. In addition, the board is regularly briefed on issues of concern for customers, unions, employees, retirees, investors and other stakeholders. Furthermore, the board oversees management’s development of our values, strategies and policies related to economic, environmental and social impacts.

Each year we publish a corporate sustainability report showcasing the aspirations, achievements, and challenges of our commitment to balancing the social, economic and environmental aspects of our business. The report is reviewed by the board prior to publication. Following is a list of key goals:

By 2022:
 28% women in full-time management globally
35% ethnically diverse full-time management in the U.S.
By 2025:
 40% alternative fuel in ground operations
 25% renewable electricity in facilities
By 2030:
 30 million volunteer hours (2011 baseline)
 50 million trees planted (2012 baseline)
By 2035:
30% sustainable aviation fuel
50% reduction in CO2 per global small package (2020 baseline)
 100% renewable electricity in facilities
By 2050:
 Achieve carbon neutralityOur Board of Directors

For more information, please visit www.about.ups.com. Our ESG goals are aspirational and may change. Statements regarding our goals are not guarantees or promises that they will be met.

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Human Capital Management

Our success is dependent upon our people, working together with a common purpose. We have approximately 534,000 employees (excluding temporary seasonal employees), of which 444,000 are in the U.S. and 90,000 are located internationally. Our global workforce includes approximately 89,000 management employees (44% of whom are part-time) and 445,000 hourly employees (51% of whom are part-time). More than 70% of our U.S. employees are represented by unions, primarily those employees handling or transporting packages. In addition, approximately 3,100 of our pilots are represented by the Independent Pilots Association.

We believe that UPS employees are among the most motivated, highest-performing people in the industry and provide us with a meaningful competitive advantage. To assist with employee recruitment and retention, we continue to review the competitiveness of our employee value proposition, including benefits and pay, the range of continuous training, talent development and promotional opportunities.

Oversight and management

We are creating an inclusive and equitable environment that brings together a broad spectrum of backgrounds, cultures and stakeholders. Leveraging diverse perspectives and creating inclusive environments improves our organizational effectiveness, cultivates innovation, and drives growth.

Our Board of Directors and its committees provide oversight on human capital matters through a variety of methods and processes. These include regular updates and discussion around human capital transformation efforts, technology initiatives impacting the workforce, health and safety matters, employee survey results related to culture and other matters, hiring and retention, employee demographics, labor relations and contract negotiations, compensation and benefits, succession planning and employee training initiatives.

In addition, the Compensation and Human Capital Committee charter was expanded last year to include oversight of performance and talent management, diversity, equity and inclusion, work culture and employee development and retention. We believe the board’s oversight of these matters helps identify and mitigate exposure to labor and human capital management risks, and is part of the broader framework that guides how we attract, retain and develop a workforce that aligns with our values and strategies.

Total rewards

We offer competitive compensation and benefits. In addition, our long history of employee stock ownership aligns the interests of our management team with shareowners. In the U.S., benefits provided to our non-union employees typically include:

comprehensive health insurance coverage;
life insurance;
short- and long-term disability coverage;
child/elder care spending accounts;
work-life balance programs;
an employee assistance program; and
a discounted employee stock purchase plan.

We invest in our people by offering a range of other benefits, such as paid time off, retirement plans, and education assistance. In the U.S., these other benefits are generally provided to non-union employees without regard to full-time or part-time status.

Transformation and human capital

As we expand and enter new markets, and seek to capture new opportunities and pursue growth, we need employees to grow and innovate along with us. We believe that transforming the UPS employee experience is foundational to our success. This requires a thoughtful balance between the culture we have cultivated over the years and the new perspectives we need to take the business into the future. This investment in capabilities to transform our business includes investing in employee growth opportunities such as professionalism, technical and other training.

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Corporate Governance

Employee health and safety

We are committed to industry-leading employee health, safety, and wellness programs across our workforce. We develop a culture of health and safety by:

investing in safety training and audits;
promoting wellness practices which mitigate risk; and
offering benefits that keep employees safe in the workplace and beyond.

Our local health and safety committees coach employees on UPS’s safety processes and are able to share best practices across work groups. Our safety methods and procedures are increasingly focused on the variables associated with residential delivery environments, which have become more common with the growth in e-commerce. We monitor our performance in this area through various measurable targets including lost time injury frequency and the number of recorded auto accidents.

Collective bargaining

We bargain in good faith with the unions that represent our employees. We frequently engage union leaders at the national level and at local chapters throughout the United States. We participate in works councils and associations outside the U.S., which allows us to respond to emerging regional issues abroad. This work helps our operations to build and maintain productive relationships with our employees.

Corporate Governance Guidelines and Committee Charters

Our Corporate Governance Guidelines and the charters for each of the board’s committees are available on our investor relations website at www.investors.ups.com. Each committee reviews its charter annually. In addition, the Nominating and Corporate Governance Committee reviews our Corporate Governance Guidelines annually and recommends any changes to the board for approval. When amending our committee charters or Corporate Governance Guidelines, we consider current governance trends and best practices, changes in regulatory requirements, advice from outside sources and input from stakeholders.

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Our Board of Directors

Proposal 1 — Director Elections

What am I voting on? Election of each of the 1312 named director nominees to hold office until the 20232025 Annual Meeting and until their respective successors are elected and qualified.

Board’s Recommendation: Vote FOR the election of each nominee.

Vote Required: A director will be elected if the number of votes cast for that director exceeds the number of votes cast against that director.

The board has nominated the personsindividuals named below for election as directors at the Annual Meeting. All nominees were elected by shareowners at our last Annual Meeting. If elected, all nominees willare expected to serve until the next Annual Meeting and until their respective successors are elected and qualified. All nominees were elected by shareowners at our last Annual Meeting. If any nominee is unable to serve as a director, which we do not anticipate, the board may reduce the number of directors that serve on the board or choose a substitute nominee. Any nominee who is currently a director, and for whom more votes are cast against than are cast for, must offer to resign from the board.

As a group, our director nominees, all of whom are currently directors, effectively oversee and constructively challenge management’s performance in the execution of our strategy. Our directors’ broad professional skills and experiences contribute to a wide range of perspectives in the boardroom. The Nominating and Corporate Governance Committee regularly assesses the skills and experience necessary for our board to function effectively and considers where additional expertise may be needed.
Diversity with respect to gender, age, ethnicity, skills, experience, perspectives, and other factors is a key consideration when identifying and recommending director nominees. Diversity in our boardroom supports UPS’s continued success. While we do not have a formal policy on board diversity, our Corporate Governance Guidelines emphasize diversity, and the Nominating and Corporate Governance Committee actively considers and assesses diversity in recruitment and nominations of director candidates through periodic board composition evaluations.
Our Corporate Governance Guidelines provide that an individual should not be eligible for nomination or election as a director of the Company after he or she reaches the age of 75 (the “retirement age requirement”). After taking into account the value our Board Chair Bill Johnson provides to the board through, among other things, his tenure, leadership roles, extensive knowledge of our business, industry, strategic priorities and competitive developments he uses to set the board’s agendas in collaboration with the CEO, and his relationships with our executives, the board (other than Bill) determined it was in the best interests of the Company and its shareowners to grant Bill a one-year waiver from the retirement age requirement so that he can continue to lead the board.
Biographical information about the director nominees appears below, including information about the experience, qualifications, attributes, and skills considered by our Nominating and Corporate Governance Committee and board in determining that the nominee should serve as a director.director, and director demographics. For additional information about how we identify and evaluate nominees for director, see “Corporate Governance — Selecting Director Nominees” on page 10.

10.

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Director Nominee Skills, Experience and Diversity
Highlights
92% Independent
61.6 years Average age
8.9 years Average tenure
42% Female
33% Ethnically diverse
Skills and Experience / Attributes
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Digital Technologyllll
Geopolitical Riskll
Global / Internationallllllll
Healthcarelll
Human Capital
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Operationalllllllll
Risk / Compliance /
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Sales / Marketinglllll
Small and Medium-
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Supply Chain
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Technology /
Technology Strategy
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Other Public Company
Board Service
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Race / Ethnicity
Asian / Asian
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Black / African
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Gender
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Director Nominee Biographical Information
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Carol Tomé

UPS Chief Executive Officer

Age: 67
Director since 2003
Board Committee
Executive (Chair)

Career

Carol was appointed UPS’s Chief Executive Officer effective June 2020. As CEO, Carol has primary responsibility for managing the Company’s day-to-day operations, and for developing and communicating our strategy. She was Chief Financial Officer of The Home Depot, Inc., one of the world’s largest retailers, from 2001; and Executive Vice President Corporate Services from 2007 until her retirement in 2019. At The Home Depot, she provided leadership in the areas of real estate, financial services and strategic business development. Her corporate finance duties included financial reporting and operations, financial planning and analysis, internal audit, investor relations, treasury and tax. She previously served as Senior Vice President Finance and Accounting and Treasurer from 2000 until 2001; and from 1995 until 2000 she served as Vice President and Treasurer.

Carol serves on the Board of Directors forof Verizon Communications, Inc. and served on the Board of Directors of Cisco Systems, Inc. until 2020. She also served as a Trustee of certain Fidelity funds in 2017.

Reasons for election to the UPS Board

Carol has a thorough understanding of our strategies and operations as a result of serving as Chief Executive Officer, and from her extensive experience gained from serving on the board and as Chair of the Audit Committee prior to becoming Chief Executive Officer. She has an in-depth knowledge of logistics and has broad experience in corporate finance and risk and compliance gained throughout her career at The Home Depot. She brings the experience of having served as Chief Financial Officer of a complex, multi-national business with a large, labor intensive workforce. Carol also has experience with strategic business development, including e-commerce strategy.

Age: 65

Director since 2003

Skills and Experience

- CEO experience

- CFO experience

- Consumer retail

- Digital technology

- Risk and compliance

Other Public Company Boards

- Verizon Communications, Inc.

Board Committee

- Executive (Chair)






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Our Board of Directors

Rodney Adkins

Former Senior Vice President, International Business Machines Corporation

Age: 65
Director since 2013
Board Committees
Risk (Chair)
Compensation and Human Capital
Executive

Career

Rod is President of 3RAM Group LLC, a private company specializing in capital investments, business consulting and property management services. Prior to that role, Rod served as IBM’s Senior Vice President of Corporate Strategy before retiring in 2014. Rod was previously IBM’s Senior Vice President, Systems and Technology Group, a position he held since 2009, and senior vice president of STG development and manufacturing, a position he held since 2007. In his over 30-year career with IBM, a multinational technology company, Rod held a number ofseveral other development and management roles, including general management positions for the PC Company, UNIX Systems and Pervasive Computing.

Rod currently serves as non-executive Chairman of Avnet, Inc., in addition to serving on the Boards of Directors forof PayPal Holdings, Inc. and W.W. Grainger, Inc. He also served onretired from the Board of Directors forof PPL Corporation untilin 2019.

Reasons for election to the UPS Board

As a senior executive of a public technology company, Rod gained a broad range of experience, including experience in emerging technologies and services, global business operations, and supply chain management. He isremains a recognized leader in technology and technology strategy. Rod devotes significant time and attention to his roles as a board member and Risk Committee Chair. In addition, Rod hasthe board benefits from Rod’s experience serving as a director of other publicly traded companies.

Age: 63

Director since 2013

Skills and Experience

- Digital technology

- Risk and compliance

- Supply chain management

- Technology and technology strategy

Other Public Company Boards

- Avnet, Inc.

- PayPal Holdings, Inc.

- W.W. Grainger, Inc.

Board Committees

- Risk (Chair)

- Compensation and Human Capital

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Eva Boratto

Chief Financial Officer, Opentrons Labworks,Bath & Body Works, Inc.

Age: 57
Director since 2020
Board Committee
Audit (Chair)

Career

Eva ishas served as the Chief Financial Officer of Bath & Body Works, Inc., a leader in personal care and home fragrances, since August 2023. She previously served as the Chief Financial Officer for Opentrons Labworks, Inc., a private disruptive biotechnologyprivately held life sciences company, leveraging its integrated lab platform to accelerate the pace of innovation in life sciences. She has served in this role sincefrom February 2022. Eva will also serve on Opentrons’ Board of Directors.

2022 until July 2023.

Eva served as Executive Vice President and Chief Financial Officer for CVS Health Corporation, a diversified health services company, from 2018 until her retirement in 2021. In this role, Eva was responsible for all aspects of the company’s financial strategy and operations, including accounting and financial reporting, investor relations, mergers and acquisitions, treasury and capital planning, investments, risk management, tax, budgeting and planning, and procurement.

Prior to this role, from 2017 to 2018, Eva was Executive Vice President, Controller and Chief Accounting Officer for CVS Health. She served as Senior Vice President and Chief Accounting Officer of CVS Health from 2013 to 2017. Eva joined the company in 2010 and served as Senior Vice President for pharmacy benefit management finance until 2013.

Reasons for election
Eva brings to the UPS Board

Eva hasboard extensive experience in corporate finance experience gained throughout her career as a Chief Financial Officer at CVS Health.multiple companies. She also brings the experience of having served as Chief Financial Officer ofa senior executive at a complex healthcare business with a large workforce and extensive retail presence, and at a smaller, growth oriented business, including deep knowledge of financial reporting and accounting standards. Eva also hasprovides the board with the benefits of her experience with strategic risk management and provides significant expertise in healthcare matters.

Age: 55

Director since 2020

Skills and Experience

- CFO experience

- Consumer retail

- Healthcare

- Risk and compliance

Board Committee

- Audit (Chair)







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Table of Contents

Michael Burns

Former Chairman, Chief Executive Officer and President, Dana Incorporated

Age: 72
Director since 2005
Board Committee
Audit

Career

Mike was the Chairman, President and Chief Executive Officer of Dana Incorporated, a global manufacturer of technology driveline, sealing and thermal-management products, from 2004 until his retirement in 2008. He joined Dana Incorporated in 2004 after 34 years with General Motors Company. During his tenure at General Motors, Mike held various positions of increasing responsibility, including serving as President of General Motors Europe AG from 1998 to 2004.

Reasons for election to the UPS Board

Mike has years of senior leadership experience gained while managing large, complex businesses and leading an international organization that operated in a highly competitive industry. He also has experience in design, engineering, manufacturing, and sales and distribution. Mike also brings deep knowledge of technology and the supply of components and services to major vehicle manufacturers.

Age: 70

Director since 2005

Skills24

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- CEO experience

- Global perspective, international

- Operations

- Technology and technology strategy

Board Committee

- Audit

2024 Proxy Statement



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Wayne Hewett

Senior Advisor to Permira and Non-Executive Chairman, Cambrex Corporation

Age: 59
Director since 2020
Board Committee
Audit

Career

Since 2018, Wayne has served as a senior advisor to Permira, a global private equity firm, and since 2020, asfirm. As a part of his role at Permira, Wayne serves in the following capacities at Permira Funds private portfolio companies: Non-Executive Chairman of Cambrex Corporation, a leading contract developer and manufacturer of active pharmaceutical ingredients, and a private portfolio company of Permira Funds. In addition, since 2021, he has served as a2020; director of Lytx, a telematics solutions provider, since 2021; as lead director of Hexion Chemicals, a specialty chemicals and a portfolio company of Permira Funds. From 2018 to 2021, Wayne also servedperformance materials manufacturer, since 2023; and as Non-Executive Chairman of DiversiTech Corporation,Quotient Sciences, a manufacturer and supplier of HVAC equipment.

drug development accelerator, since 2023.

Wayne served as Chief Executive Officer and as a member of the Board of Directors of Klöckner Pentaplast Group, a leading supplier of plastic films for pharmaceutical, medical devices, food and other specialty applications, from 2015 to 2017. He also served as President and as a member of the Board of Directors, of Platform Specialty Products Corporation during 2015, and as President, Chief Executive Officer and as a member of the Board of Directors of Arysta LifeScience Corporation from 2010 to 2015. Arysta was acquired in 2015 by Platform Specialty Products Corporation.

Prior to joining Arysta, he served as a senior consultant to GenNx360, a private equity firm focused on sponsoring buyouts of middle market companies. He also spent over two decades at General Electric Company, serving in a variety of executive roles.

Wayne currently serves on the Boards of Directors of The Home Depot, Inc. and Wells Fargo, Inc.

Reasons for election to the UPS Board

Wayne has extensive experience in general management, finance, supply chain, operational and international matters gained through serving in various executive roles. He has significant experience executing company-wide initiatives across large organizations, developing proprietary products, optimizing supply chains, and using emerging technologies to provide new products and services. He brings insights on business operations and risk management through his senior management roles. In addition, Wayne has valuable experience serving as a director of other publicly traded companies.

Age: 57

Director since 2020

Skills and Experience

- CEO experience

- Global perspective, international

- Healthcare

- Operations

- Supply chain management

Other Public Company Boards

- The Home Depot, Inc.

- Wells Fargo, Inc.

Board Committee

- Audit









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Our Board of Directors

Angela Hwang

Group

Former Chief Commercial Officer and President, Pfizer Biopharmaceuticals Group,Business, Pfizer, Inc.

Age: 58
Director since 2020
Board Committee
Audit

Career

Angela has beenserves as an advisor to Pfizer, Inc., a multinational pharmaceutical and biotechnology company, as that company undertakes changes in its commercial organization following the completion of an acquisition. She was a member of Pfizer, Inc.’sPfizer’s Executive Team sincefrom 2018 to 2023 and currently is Groupserved as Chief Commercial Officer and President of the PfizerPfizer’s Global Biopharmaceuticals Group, a position she has held since 2019.Business from 2019 to 2023. In this role, Angela leadsled Pfizer’s entire commercial business which includes eight commercial business units,included six different businesses reaching patients in more than 125185 countries. Angela has been with Pfizer since 1997, working across all geographies and therapeutic areas.

Prior to her current role, during

During 2018 she served as Group President, Pfizer Essential Health; and from 2016 to 2018 she was Global President Pfizer Inflammation and Immunology. From 1997 until that time, Angela has served in various roles with increasing responsibility across all geographies and therapeutic areas, including senior roles in Pfizer Vaccines, Primary Care, and Emerging Markets.

Angela sits on the boardsboard of advisors of the European FederationCornell Johnson School of Pharmaceutical Industries and Associations, and the Pfizer Foundation, a charitable organization that addresses global health challenges.

Management.

Reasons for election to the UPS Board

Angela has significant expertise in the healthcare sector and in managing large complex businesses, including supply chain management and logistics. She also has experience in emerging markets gained through her work across many geographies. Angela is also a strong advocate for women’s leadership and sustainable global health equity.

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Kate Johnson
President and Chief Executive Officer, Lumen Technologies, Inc.

Age: 56

Director since 2020

Skills

Board Committees
Nominating and Experience

- Global perspective, international

- Healthcare

- Operations

- Supply chain management

Board Committee

- Audit







Corporate Governance
Risk

Career
Kate Johnson

Formerhas served as President, Microsoft U.S.CEO and a member of the board of directors of Lumen Technologies, Inc., Microsoft Corporation

Career

a multinational technology company that integrates network assets, cloud connectivity, security solutions and voice and collaboration tools into one platform for businesses, since November 2022. Previously, Kate served as President of Microsoft U.S., a division of Microsoft Corporation, a global technology company, from 2017 until her retirement in 2021. She had responsibility for Microsoft’s U.S. activities, including growing the company’s solutions, services, and support revenues. She focused on driving transformation with Microsoft’s largest sales subsidiary, leading a 9,500 + person field team.

Prior to Microsoft, she held various senior positions with GE, including Executive Vice President and Chief Commercial Officer GE Digital, from 2016 to 2017; Chief Executive Officer, GE Intelligent Platforms Software from 2015 to 2016; and Vice President and Chief Commercial Officer, from 2013 to 2015.

Prior to GE, she held various senior leadership roles at Oracle and various roles with increasing responsibilities at Red Hat, UBS Investment Bank and Deloitte Consulting.

Reasons for election to the UPS Board

Kate has significant public company leadership experience, including CEO experience and experience leading businesses within large companies undergoing transformation, large systems companies, and high growth disruptors. She brings atechnology companies. The board benefits from her strong commercial orientation, strategic experience and technical acumen.

Age: 54

Director since 2020

Skills and Experience

- Consumer retail

- Digital technology

- Human capital management

- Operations

- Sales and marketing

- Small and medium sized businesses

- Technology and technology strategy

Board Committees

- Nominating and Corporate Governance

- Risk

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William Johnson

UPS Board Chair

Former Chairman, President and Chief Executive Officer, H.J. Heinz Company

Age: 75
Director since 2009
Board Chair since 2020
Lead Director 2016 – 2020
Board Committees
Nominating and Corporate Governance (Chair)
Executive

Career

Bill currently serves as UPS’s Board Chair, and previously served as Chairman, President and Chief Executive Officer of H.J. Heinz Company, a global packaged foods manufacturer, from 2000 until his retirement in 2013. He became President and Chief Operating Officer of H.J. Heinz in 1996, and assumed the position of President and Chief Executive Officer in 1998.

Bill currently serves on the Board of Directors of Sovos Brands, Inc. Heand he previously served on the BoardsBoard of Directors of Emerson Electric Company until 2017 and PepsiCo, Inc. until 2020.

Reasons for election to the UPS Board

Bill has significant senior management experience gained through over 13his years of service as the Chairman and Chief Executive Officer of H.J. Heinz, a corporation with significant international operations and a large, labor intensive workforce. He also has deep experience in operations, marketing, brand development and logistics. He served as our lead independent director from 2016 to 2020, and he has served as our independent Board Chair since 2020, during which time he has gained significant knowledge and expertise about our board functions, operations, business and strategy.

Age: 73

Director since 2009

- Board Chair since 2020

- Lead Director 2016 – 2020

Skills and Experience

- CEO experience

- Consumer retail

- Global perspective, international

- Human capital management

- Operations

- Sales and marketing

- Supply chain management

Other Public Company Boards

- Sovos Brands, Inc.

Board Committees

- Nominating and Corporate Governance (Chair)

- Executive

26

Ann Livermore

Former Executive Vice President, Hewlett Packard Company

Career

Ann was Executive Vice President of the HP Enterprise Business at Hewlett Packard Company, one of the world’s largest information technology companies, until her retirement in 2011. Ann joined HP in 1982 and held a variety of management positions in marketing, sales, research and development, and business management before being appointed a corporate vice president in 1995.

Ann serves on the Boards of Directors of Hewlett Packard Enterprise Company, Qualcomm Incorporated, and Samsara, Inc. She served on the Board of Directors of Hewlett Packard Company until 2015.

Reasons for election to the UPS Board

Ann has extensive operational experience from her senior leadership positions at HP. This includes leading a complex global business organization with a large workforce. Through her 29 years at HP, she gained knowledge and experience in technology, marketing, sales, research and development and business management.

Age: 63

Director since 1997

Skills and Experience

- Digital technology

- Sales and marketing

- Small and medium sized businesses

- Technology and technology strategy

Other Public Company Boards

- Hewlett Packard Enterprise Company

- Qualcomm Incorporated

- Samsara, Inc.

Board Committees

- Compensation and Human Capital (Chair)

- Risk

- Executive

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Our Board of Directors

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Franck Moison

Former Vice Chairman, Colgate-Palmolive Company

Age: 70
Director since 2017
Board Committees
Nominating and Corporate Governance
Risk

Career

Franck was Vice Chairman forof the Colgate-Palmolive Company, a global consumer products company, a position he held from 2016 until his retirement in 2018. He led Colgate-Palmolive’s operations in Asia, South Pacific and Latin America, and he also led Global Business Development. Previously, he was Chief Operating Officer of Emerging Markets from 2010 until 2016, and he was given additional responsibility for Business Development in 2013. Beginning in 1978, Franck served in various management positions with Colgate-Palmolive, including President, Global Marketing, Global Supply Chain & R&D from 2007 to 2010; and President, Western Europe, Central Europe and South Pacific from 2005 to 2007.

He serves on the Boards of Directors of Hanes Brands, Inc. and SES-imagotag in France. He is the Chairman of the International Advisory Board of the EDHEC Business School (Paris, London, Singapore) and is a member of the International Board of the McDonough School of Business at Georgetown University.

Reasons for election
Franck brings to the UPS Board

Franck hasboard extensive experience as a senior executive at a large organization engaged in international business. He is a leaderhas deep expertise in consumer product innovation, strategic marketing, acquisitions, and emerging market business development. He is a highly accomplished marketing and operating executive in the global consumer products industry. In addition, Franck has experience serving as a director of other publicly traded companies.

the board benefits from his extensive international board experience.

Age: 68

Director since 2017

Skills and Experience

- Consumer retail

- Geopolitical risk

- Global perspective, international

- Operations

- Sales and marketing

- Supply chain management

Other Public Company Boards

- Hanes Brands, Inc.

Board Committees

- Nominating and Corporate Governance

- Risk

ChristianaSmithShi_BOD_HighRes_black and white.jpg

Christiana Smith Shi

Former President of Direct-to-Consumer, Nike, Inc.

Age: 64
Director since 2018
Board Committees
Compensation and Human Capital(Chair)
Risk

Career

Christiana is the founder and currently principal at Lovejoy Advisors, LLC, an advisory services firm that assists clients with digitally transforming consumer and retail businesses. She was the President, Direct-to-Consumer, for Nike, Inc., a global apparel company, from 2013 until 2016. From 2012 through 2013, she was Nike’s Vice President and General Manager, Global Digital Commerce. She joined Nike in 2010 as Vice President and Chief Operating Officer, Global Direct-to-Consumer. Prior to joining Nike, Christiana spent 24 years at global management consulting firm McKinsey & Company, the last 10ten as a senior partner. She began her career at Merrill Lynch & Company in 1981 and served in various trading, institutional sales and investment banking roles.

Christiana also serves on the Board of Directors of Mondelēz International, Inc.Columbia Sportswear Company. She served on the Boards of Directors of West Marine, Inc. until 2017 and Williams-Sonoma, Inc. until 2019.

2019 and Mondelēz International, Inc. until 2023.

Reasons for election
Christiana brings to the UPS Board

Christiana hasboard substantial experience in digital commerce, global retail operations and helping companies with transformative change. She also hasprovides strong supply chain and cost management expertise in the global consumer industry. She gained experience advising senior executives at consumer companies across North America, Europe, Latin America and Asia on leadership and strategy. Christiana also hasstrategy, and provides extensive public company board experience.

Age: 62

Director since 2018

Skills and Experience

- Consumer retail

- Digital technology

- Global perspective, international

- Operations

- Sales and marketing

- Supply chain management

Other Public Company Boards

- Mondelēz International, Inc.

Board Committees

- Compensation and Human Capital

- Risk

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27

Russell Stokes.jpg

Russell Stokes

President and Chief Executive Officer Commercial Engines and Services, GE Aviation Services

Aerospace
Age: 52
Director since 2020
Board Committees
Compensation and Human Capital
Nominating and Corporate Governance

Career

Russell has served asis President and Chief Executive Officer, Commercial Engines and Services, GE Aerospace, a world-leading provider of jet engines, components and integrated systems for commercial and military aircraft, and a provider of services to support these offerings. He has served in these roles since July 2022 and is responsible for an industry-leading portfolio of engines and services. Russell previously served as President and CEO of GE Aviation Services since 2020. Russell leads GE’s Aviation Servicesfrom 2020 until 2022, where he was responsible for commercial growth, operating performance and customer experience across its global Overhaul and Repair footprint. Prior to this role, Russell was president and CEO of GE Power Portfolio from 2019 to 2020, GE Power from 2017 to 2019, GE Energy Connections from 2015 to 2017, and GE Transportation from 2013 to 2015. He has held other senior roles at GE Transportation and GE Aviation. Russell joined GE in 1997 as part of GE’s Financial Management Program.

He is active in several Atlanta community-based organizations and is the former Chairman of the Metro Atlanta Chamber of Commerce.

Reasons for election to the UPS Board

During his more than 24-year25-year career at GE, Russell has gained deep finance and operating experience through navigating multiple industries, business segments, and market cycles. He hasbrings to the board extensive experience in transforming businesses by moving complex business issues into focused, targeted actions for improvement. He hasalso provides experience in developing solutions and technology required to ensure successful implementation of thesuccessfully implement business strategy.

strategies.

Age: 50

Director since 2020

Skills and Experience

- Human capital management

- Operations

- Risk and compliance

- Sales and marketing

- Small and medium sized businesses

- Technology and technology strategy

Board Committees

- Compensation and Human Capital

- Nominating and Corporate Governance

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Kevin Warsh

Former Member of the Board of Governors of the Federal Reserve System, Distinguished Visiting Fellow, Hoover Institution, Stanford University

Age: 53
Director since 2012
Board Committees
Compensation and Human Capital
Nominating and Corporate Governance

Career

Kevin currently serves as the Shepard Family Distinguished Visiting Fellow in Economics at Stanford University’s Hoover Institution, a public policy think tank, and as a Dean’s Visiting Scholar and lecturer at Stanford’s Graduate School of Business. He also serves as advisor topartner at Duquesne Family Office.

Office LLC and is a member of the Group of Thirty (G30) and the Panel of Economic Advisers of the Congressional Budget Office (CBO). He was a member of the Board of Governors of the Federal Reserve from 2006 until 2011. From 2002 until 2006, Kevin served at the White House as President George W. Bush’s special assistant for economic policy and as executive secretary of the National Economic Council. Kevin was previously employed by Morgan Stanley & Co., eventually serving as vice president and executive director of the Mergers and Acquisitions department.

He also serves on the Board of Directors of Coupang, Inc.

Reasons for election to
Kevin offers the UPS Board

Kevin hasboard extensive experience in understanding and analyzing the economic environment, the financial marketplace and monetary policy. He has a deep understanding of the global economic and business environment. Kevin also bringsprovides the experience of working in the private sector for a leading investment bank gained during his tenure at Morgan Stanley & Co.

Age: 51

Director since 2012

Skills and Experience

- Geopolitical risk

- Global perspective, international

- Government and regulatory

Other Public Company Boards

- Coupang, Inc.

Board Committees

- Compensation and Human Capital

- Nominating and Corporate Governance

28

28      
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Notice of Annual Meeting of Shareowners and 20222024 Proxy Statement

Having a significant majority of Contents

non-management independent directors encourages robust debate and challenged opinions in the boardroom. Our BoardCorporate Governance Guidelines include director independence standards consistent with the New York Stock Exchange (“NYSE”) listing standards. Our Corporate Governance Guidelines are available on the governance section of Directors

our investor relations website at www.investors.ups.com.

The board has evaluated each director’s independence and considered whether there were any relevant relationships between UPS and each director, or any member of his or her immediate family. The board also examined whether there were any relationships between UPS and organizations where a director is or was a partner, principal shareowner or executive officer.
Specifically, the board evaluated certain ordinary course business transactions and relationships between UPS and the organizations that currently or in the prior year employed Eva Boratto, Mike Burns, Wayne Hewett, Angela Hwang, Kate Johnson, Russell Stokes and Kevin Warsh, or their immediate family members, as an executive officer. The board also evaluated the ordinary course business transactions and relationships between UPS and any organizations where Rod Adkins, Wayne Hewett, Christiana Smith Shi and Kevin Warsh, or their immediate family members, were a partner or principal shareowner. In each case, no such transactions exceeded the thresholds in UPS’s Corporate Governance Guidelines. The board determined that none of these transactions or relationships were material to the Company, the individuals or the organizations with which they were associated.
The board has determined that each director nominee, other than our CEO, Carol Tomé, is independent. All members of the Audit Committee, Compensation and Human Capital Committee, Nominating and Corporate Governance Committee and Risk Committee are independent, and all members of the Audit Committee and the Compensation and Human Capital Committee meet the additional independence criteria applicable to directors serving on these committees under New York Stock Exchange listing standards.
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29


Committees of the Board of Directors

The board has four committees composed entirely of independent directors as defined by the NYSE and by our director independence standards. Information about each of these committees is provided below. The board also has an Executive Committee that may exercise all powers of the Board of Directors in the management of our business and affairs, except for those powers expressly reserved to the board under Delaware law or otherwise limited by the board. Carol Tomé is the Chair, and Ann LivermoreRod Adkins and Bill Johnson also serve on the Executive Committee. The Executive Committee held one meeting during 2021.

Audit Committee(1)
Compensation and Human
Capital Committee(2)
Nominating and Corporate
Governance Committee
Risk Committee
Eva Boratto, Chair
Michael Burns
Wayne Hewett
Angela Hwang
Ann Livermore, Chair
Rodney Adkins
Christiana Smith Shi,
Chair
Rodney Adkins
Russell Stokes
Kevin Warsh
William Johnson, Chair
Kate Johnson
Franck Moison
Russell Stokes
Kevin Warsh
Rodney Adkins, Chair
Kate Johnson
Ann Livermore
Franck Moison
Christiana Smith Shi
Meetings in 2023: 9
Meetings in 2023: 6
Meetings in 2023: 4
Meetings in 2023: 4
Meetings in 2021: 10
Primary ResponsibilitiesPrimary ResponsibilitiesMeetings in 2021: 5Primary ResponsibilitiesMeetings in 2021: 4Meetings in 2021: 3Primary Responsibilities
Primary ResponsibilitiesPrimary ResponsibilitiesPrimary ResponsibilitiesPrimary Responsibilities

Assisting the board in discharging its responsibilities relating to our accounting, reporting and financial practices

Overseeing our accounting and financial reporting processes

Overseeing the integrity of our financial statements, our systems of disclosure controls and internal controls

Overseeing the performance of our internal audit function

  Overseeing

Engaging and overseeing the engagement and performance of our independent accountants

Overseeing compliance with legal and regulatory requirements as well as our Code of Business Conduct

Discussing with management policies with respect to financial risk assessment

Assisting the board in discharging its responsibilities with respect to compensation of our senior executive officers

Reviewing and approving corporate goals and objectives relevant to the compensation of our Chief Executive Officer

CEO

Evaluating the Chief Executive Officer’sCEO’s performance

Overseeing the evaluation of riskrisks associated with our compensation strategy and programs

Overseeing any outside consultants retained to advise the Committee

Recommending to the board the compensation for non- non-management directors

Overseeing performance and talent management, diversity, equity and inclusion, work culture and employee development and retention

Addressing succession planning

Assisting the board in identifying and screening qualified director candidates, including shareowner submitted candidates

Recommending candidates for election or reelection, or to fill vacancies, on the board

Aiding in attracting qualified candidates to serve on the board

Recommending corporate governance principles, including the structure, composition and functioning of the board and all board committees, the delegation of authority to subcommittees, board oversight of management actions and reporting duties of management

Overseeing relevant environmental sustainability matters and risks

Overseeing management’s identification and evaluation of enterprise risks

Overseeing and reviewing with management ourthe Company’s risk governance framework

Overseeing risk identification, risk tolerance, risk assessment and management practices for strategic enterprise risks,

including cybersecurity risks and cyber incident response

Reviewing approaches to risk assessment and mitigation strategies in coordination with the board and other board committees

Communicating with the Audit Committee to enable the Audit Committee to perform its statutory, regulatory, and other responsibilities with respect to oversight of risk assessment and risk management

(1)All members of the Audit Committee have been designated by the Board of Directors as audit committee financial experts. Each member of our Audit Committee meets the independence requirements of the NYSE and Securities and Exchange Commission (“SEC”) rules and regulations applicable to audit committee members, and each is financially literate.
(1)All members of the Audit Committee have been designated by the Board of Directors as audit committee financial experts. Each member of the Audit Committee meets the independence requirements of the NYSE and Securities and Exchange Commission (“SEC”) rules and regulations applicable to audit committee members, and each is financially literate.
(2)Each member of the Compensation and Human Capital Committee meets the NYSE’s independence requirements applicable to compensation committee members. In addition, each member is a non-employee director as defined in Rule 16b-3 under the Securities Exchange Act of 1934. None of the members is or was during 2023 an employee or former employee of UPS, and none had any direct or indirect material interest in or relationship with UPS outside of his or her position as a non-employee director. The Compensation and Human Capital Committee may delegate its responsibilities to subcommittees of one or more directors as it may deem appropriate. For information regarding the role of our executive officers and the committee’s independent compensation consultant in determining or recommending the amount or form of executive and director compensation (as applicable), please see the Compensation Discussion and Analysis section and the Director Compensation section below in this Proxy Statement. Compensation Committee Interlocks and Insider Participation: None of our executive officers serves or served during 2023 as a member of a board of directors or compensation committee of any entity that has one or more executive officers who serve on our Board of Directors or Compensation and Human Capital Committee.
(2)30Each member
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Notice of our CompensationAnnual Meeting of Shareowners and Human Capital Committee meets the NYSE’s independence requirements applicable to compensation committee members. In addition, each member is a non-employee director as required by Rule 16b-3 under the Securities Exchange Act of 1934. None of the members of the Compensation and Human Capital Committee is or was during 2021 an employee or former employee of UPS, and none had any direct or indirect material interest in or relationship with UPS outside of his or her position as a non-employee director. The Compensation and Human Capital Committee may delegate its responsibilities to subcommittees of one or more directors as it may deem appropriate. For information regarding the role of our executive officers and the committee’s independent compensation consultant in determining or recommending the amount or form of executive and director compensation (as applicable), please see the Compensation Discussion and Analysis section and the Director Compensation section below in this proxy statement. Compensation Committee Interlocks and Insider Participation: None of our executive officers serves or served during 2021 as a member of a board of directors or compensation committee of any entity that has one or more executive officers who serve on our Board of Directors or Compensation and Human Capital Committee.2024 Proxy Statement
   29

Director Compensation

The Compensation and Human Capital Committee of the Board of Directors evaluates director compensation with the assistance of its independent compensation consultant, Frederic W. Cook & Co., Inc. (“FW Cook”).

For service in 2021,2023, our non-employee directors each received an annuala cash retainer of $110,000$116,250 and an annuala restricted stock unit (“RSU”) award valued at $175,000.$180,000. Equity compensation links director pay to the value of Company stock and aligns the interests of directors with long-term shareowners. Directors are also reimbursed for any board related expenses.

Our independent Board Chair received an additional annual cash retainer of $160,000 and an additional annual RSU award valued at $70,000 to

To reflect the additional responsibilities and time commitment associated with the position. Our CEO does not receive any compensation forvarious board service.leadership positions, our independent Board Chair received an additional cash retainer of $160,000 and an additional RSU award valued at $70,000. The chairs of the Compensation and Human Capital, Nominating and Corporate Governance and Risk Committees each received an additional annual cash retainer of $20,000, and the Chair of the Audit Committee received an additional annual cash retainer of $25,000.

Our CEO does not receive any compensation for board service. Cash retainers are paid on a quarterly basis. Non-employee directors may defer retainer feesretainers by participating in the UPS Deferred Compensation Plan, but we dothe Company does not make any contributions to this plan. There are no preferential or above-market earnings on amounts invested in the UPS Deferred Compensation Plan.

RSUs are fully vested on the date of grant and are required to be held by the director until he or she separates from the board, at which time the RSUs convert to shares of class A common stock. Dividends earned on shares underlying director RSUs are deemed reinvested in additional units at each dividend payable date and are subject to the same terms as the original grant. This holding period requirement increases the strength of the alignment of directors’ interests with those of our long-term shareowners.

Director Compensation

Following a review of Company peer group and broader industry practices, and to improve the competitiveness of non-employee director compensation, in August 2023, the Board increased non-employee director annual cash retainers to $120,000 and increased the annual RSU award value to $185,000, placing total director pay approximately 5% below the peer group median.

2023 Director Compensation and Outstanding Stock Awards
The following tables set forth the cash compensation paid to individuals who served as directors in 20212023 (other than our CEO) and the aggregate value of stock awards granted to those persons in 2021,2023, as well as outstanding director equity awards held as of December 31, 2021.

 
2021 Director Compensation
Name   Fees
 Earned or
Paid in
 Cash($)
   Stock
 Awards($)(1)
   Total($)
Rodney Adkins(2) 130,000 174,908   304,908
Eva Boratto(2) 122,500 174,908 297,408
Michael Burns 110,000 174,908 284,908
Wayne Hewett 110,000 174,908 284,908
Angela Hwang 110,000 174,908 284,908
Kate Johnson 110,000 174,908 284,908
William Johnson(2)(3) 290,000 244,785 534,785
Ann Livermore(2) 130,000 174,908 304,908
Rudy Markham(4) 67,500  67,500
Franck Moison 110,000 174,908 284,908
Clark Randt, Jr. 55,000  55,000
Christiana Smith Shi 110,000 174,908 284,908
Russell Stokes 110,000 174,908 284,908
Kevin Warsh 110,000 174,908 284,908
2023, except as described below.
Outstanding Director Stock Awards
(as of December 31, 2021)
 Stock Awards
2023 Director Compensation2023 Director Compensation
Outstanding Director Stock Awards
 
(as of December 31, 2023)
NameNameFees Earned or Paid in Cash
($)
Stock
Awards
($)
(1)
Total
($)
Stock Awards
 Restricted
Stock
Units (#)
 Phantom
Stock
Units (#)
NameRestricted
Stock Units
(#)
Phantom
Stock Units
(#)
Rodney Adkins(2)   16,543   136,250179,875316,125Rodney Adkins19,844
Eva Boratto(2) 1,677 141,250179,875321,125Eva Boratto3,904
Michael Burns 28,059 Michael Burns116,250179,875296,125Michael Burns32,194
Wayne Hewett 1,677 Wayne Hewett116,250179,875296,125Wayne Hewett3,904
Angela Hwang 2,017 Angela Hwang116,250179,875296,125Angela Hwang4,268
Kate Johnson 1,373 Kate Johnson116,250179,875296,125Kate Johnson3,577
William Johnson(3) 29,757 296,250249,884546,134William Johnson34,845
Ann Livermore(4) 28,059 2,74067,50067,500
Ann Livermore(4)(6)
2,939
Rudy Markham(5)  
Franck Moison 8,664 Franck Moison116,250179,875296,125Franck Moison11,396
Clark Randt, Jr.(5)  
Christiana Smith Shi 6,804 
Christiana Smith Shi(2)
Christiana Smith Shi(2)
126,250179,875306,125Christiana Smith Shi9,401
Russell Stokes 1,373 Russell Stokes116,250179,875296,125Russell Stokes3,577
Kevin Warsh 18,576 Kevin Warsh116,250179,875296,125Kevin Warsh22,025
Carol Tomé(6) 25,244 1,295
Carol Tomé(5)(6)
Carol Tomé(5)(6)
27,0711,389


(1)The values of stock awards in this column represent the grant date fair value of RSUs granted in 2023, computed in accordance with Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) Topic 718. RSUs are fully vested on the date of grant and are settled in shares of class A common stock upon the director’s separation from service from UPS.
(2)Includes cash compensation for committee chair service.
(3)Includes cash compensation and stock awards for independent board chair service.
(4)Ann Livermore retired from the board on May 4, 2023. Information is as of such date. All outstanding RSUs converted into shares of class A common stock upon such retirement.
(5)Only includes outstanding stock awards that were granted while serving as an independent director.
(6)Phantom stock units were granted to non-employee directors pursuant to a deferred compensation program previously provided to non-employee directors. Upon termination, amounts represented by phantom stock units will be distributed in cash over a time period elected by the recipient.
(1)The values of stock awards in this column represent the grant date fair value of RSUs granted in 2021, computed in accordance with Financial Accounting Standards Board Accounting Standards Codification (“FASB ASC”) Topic 718. Information about the assumptions used to value these awards can be found in Note 14 “Stock-Based Compensation” in our 2021 Annual Report on Form 10-K. RSUs are fully vested on the date of grant and are settled in shares of class A common stock upon the director’s separation from service from UPS.
(2)
UPS logo.jpg
Includes compensation for committee chair service.31


(3)Includes compensation for independent board chair service.
(4)Includes compensation for Audit Committee chair service prior to retiring from the board in May 2021.
(5)All outstanding stock awards were paid out following retirement from the board in May 2021.
(6)Only includes outstanding stock awards that were granted while serving as an independent director.Executive Compensation

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Table of Contents

Executive Compensation

Executive Compensation

Compensation Committee Report

The Compensation and Human Capital Committee (as used in this Executive Compensation section, the “Committee”) is responsible for setting the principles that guide compensation decision-making, establishing the performance goals under our executive compensation plans and programs, and approving compensation for the executive officers. The Committee is also responsible for overseeing performance and talent management, diversity, equity and inclusion, work culture and employee development and retention.

We are focused on maintaining an executive compensation program that supports the long-term interests of the Company’s shareowners. We align the interests of our executivesexecutive officers with those of all shareowners by linking a significant portion of compensation to Company performance and shareowner returns. The Company’s programs are also designed to attract, retain, and motivate executives who make substantial contributions to the Company’s performance by allowing them to share in the Company’s success.

Our significant efforts in 2023 included adopting an incentive compensation clawback policy applicable to executive officers in the past year includedevent of a Company financial restatement, developing and implementing an appropriate executive compensation structure and performance goals in the midst of a global pandemic and analyzingchallenging economic environment including Company labor uncertainty, and updating the Company’s peer group. The Committee’s compensation framework, withpay mix for executive officers through structural changes to the supportannual incentive program to make this program more competitive. With the assistance of our independent compensation consultant enabled usand taking into account recent stakeholder feedback and market developments, we also reevaluated the performance metrics on which incentive compensation payouts would be based in order to successfully navigate these challenges consistentmaximize long-term value. In addition, beginning with our compensation principles. the 2024 performance period, the Committee has returned to annual goal setting for annual incentive awards.
Also during 2021,2023, the board delegated responsibility forCommittee continued to execute on its human capital oversight toresponsibilities, including supporting succession planning efforts at the Committee.

senior management level, overseeing progress towards the Company’s diversity in management goals, and monitoring employee recruitment and retention efforts.

We have reviewed the Compensation Discussion and Analysis and discussed it with management. Based on our review and discussions, we recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the 20222024 Proxy Statement and incorporated by reference in the Annual Report on Form 10-K for the year ended December 31, 20212023 filed with the Securities and Exchange Commission.

The following Compensation Discussion and Analysis describes the Committee’s principles, strategy and programs regarding 20212023 executive compensation.

The Compensation &and Human Capital Committee

Ann Livermore, Chair
Rodney Adkins

Christiana Smith Shi,
Chair
Rodney Adkins
Russell Stokes
Kevin Warsh

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Notice of Annual Meeting of Shareowners and 2024 Proxy Statement


Compensation Discussion and Analysis

UPS’s executive compensation principles, strategy and programs for 2021, and certain aspects of the 2022 programs,2023 are described below. This section explains how and why the Committee made its 20212023 compensation decisions for our executive officers, including additional detail with respect todetails regarding the following Named Executive Officers (“NEOs”):

Named Executive Officer
Title
Carol ToméChief Executive Officer
Brian NewmanChief Financial Officer
Scott PriceNando CesaronePresident U.S. and UPS InternationalAirline
Nando CesaroneKate GutmannPresident U.S. OperationsInternational, Healthcare and Supply Chain Solutions
Kate GutmannBala SubramanianChief SalesDigital and SolutionsTechnology Officer
Executive Compensation Strategy

As discussed further below, on March 1, 2022, UPS announced that Scott Price is retiring from the Company on March 31, 2022. Kate Gutmann will move into a newly created role of President International, Healthcare and Supply Chain Solutions.

Executive Compensation Strategy

UPS’s executive compensation programs are designed to:

to drive organizational performance by tying a significant portion of pay to Company performance; attract, retain and motivate by competitively and fairly compensating our executive officers; encourage long-term stock ownership and careers with UPS; and align the interests of our executives to long-term value creation.
We believe it is appropriate to have a clear link between variable pay and operational and financial performance. We seek to develop performance metrics aligned with the Company’s strategy and business model. Long-term incentive awards vest over timeframes aligned with the delivery of long-term shareowner value.
drive organizational performance by tying a significant portion of pay to Company performance;
Key Elements of UPS Executive Compensation
Total target direct compensation (generally, base salary and annual and long-term incentives, but excluding any special awards) for our NEOs in 2023 consisted of the following key elements.
gfx_keyelements.jpg
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33


attract, retain and motivate by competitively and fairly compensating our executive officers;
encourage long-term stock ownership and careers with UPS; and
align the interests of our executives to long-term value creation.Target Direct Compensation
   31

Table of Contents

Target Compensation

A substantial majority of NEO total target direct compensation (base salary and annual and long-term incentives, excluding any one-time special awards) is “at risk” and subject to the achievement of annual or long-term performance goals and/or continued employment with UPS. The charts below highlight the elements of our CEO and an average of other NEOs’ target direct compensation for 2021.

Roles and Responsibilities

2023.

pie_targecompensation.jpg
Other Elements of Compensation
BenefitsPerquisitesRetirement Programs
üNEOs generally participate in the same plans as other employees.
üIncludes medical, dental and disability plans.
üSee further details on page 41.
üLimited in nature; we believe benefits to the Company outweigh the costs.
üIncludes financial planning and executive health services that facilitate the NEOs’ ability to carry out responsibilities, maximize working time and minimize distractions.
üConsidered necessary or appropriate to attract and retain executive talent.
üSee further details on page41.
üNEOs and most non-union U.S. employees participate in the same qualified plans with the same formulas.
üIncludes non-qualified and qualified pension, retirement savings and deferred compensation plans.
üSee further details on page 41.

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Notice of Annual Meeting of Shareowners and 2024 Proxy Statement


Roles and Responsibilities
The Committee is responsible for setting the principles that guide compensation decision-making, establishing performance goals under our executive compensation plans and programs, and approving compensation for the executive officers. The Committee may engage and terminate the services of outside advisors and other consultants. In 2021,2023, the Committee retained FW Cook to act as its independent compensation advisor. FW Cook reported directly to the Committee and provided no additional services to UPS. The following table summarizes the key roles and responsibilities in the executive compensation decision-making process.

Participant and Roles

The Committee

develops principles underpinning executive compensation

sets performance goals upon which incentive payouts are based

evaluates the CEO’s performance

reviews the CEO’s performance assessment of other executive officers

reviews and approves incentive and other compensation of the executive officers

reviews and approves the design of other benefit plans for executive officers

oversees the risk evaluation associated with our compensation strategy and programs

considers whether to engage any compensation consultant, and evaluates their independence

reviews and discusses with management the Compensation Discussion and Analysis

with management

recommends to the board the inclusion of the Compensation Discussion and Analysis in the Proxy Statement

approves the inclusion of the Committee’s report on executive compensation in the Proxy Statement

Independent Members of the Board of Directors

review the Committee’s assessment of the CEO’s performance

complete a separate evaluation of the CEO’s performance

approve the Compensation Discussion and Analysis for inclusion in the Proxy Statement

Independent Compensation Consultant

serves as a resource for market data on pay practices and trends

provides independent advice to the Committee

provides competitive analysis and advice related to outside director compensation

reviews the Compensation Discussion and Analysis

conducts an annual risk assessment of the Company’s compensation programs

32      Notice of Annual Meeting of Shareowners and 2022 Proxy Statement

Table of Contents

Executive Compensation

Participant and Roles

Executive Officers

the CEO makes compensation recommendations to the Committee for the other executive officers with respect to base salary, annual and long-term incentive targets, and individual performance adjustments to annual incentive plan payouts

the CEO and CFO recommend performance goals under incentive compensation plans and provide an assessment as to whether performance goals were achieved

Compensation Consultant Independence

Compensation Consultant Independence

In November 2021,2023, the Committee reviewed FW Cook’s independence and the existence ofevaluated any potential conflicts of interest. The Committee evaluated all relevant factors, including: (1) other services provided to UPS by FW Cook (if any); (2) fees paid by UPS as a percentage of FW Cook’s total revenue; (3) policies or procedures maintained by FW Cook that are designed to prevent a conflict of interest; (4) any business or personal relationships between the individual consultants involved in the engagement and a member of the Committee; (5) any Company stock owned by the individual consultants involved in the engagement; and (6) any business or personal relationships between UPS executive officers and FW Cook or the individual consultants involved in the engagement.

After evaluating these factors, the Committee concluded that FW Cook was independent, and that the engagement of FW Cook did not raise any conflict of interest.

Peer Group and Market Data Utilization

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35


Peer Group and Market Data Utilization
In determining compensation targets and payouts, the Committee evaluates, among other things, pay practices and compensation levels at a peer group of companies.

In addition to peer group analyses, the Committee considers other market data, including general compensation survey data from comparably sized companies. Compensation is not targeted to a particular percentile within that peer group or otherwise.

With assistance from its independent compensation consultant, the Committee evaluates the peer group annually to determine if the companies included in the group are the most appropriate comparators for measuring the success of our executives in delivering shareowner value. In 2021, in consideration of the Company’s transformation efforts and evolving business strategy, theThe Committee directed FW Cookseeks to undertakeselect a comprehensive evaluation of the peer group. After a detailed analysis, including meetings with each Committee member, FW Cook recommended revising thecompensation peer group selection criteria to better alignthat is aligned with the Company’s business strategy and focus. Quantitative considerations consistedconsist of historical revenue, growth, operating income growth,and free cash flow, growth, andas well as total shareholder return. Other more general considerations includedinclude market capitalization, percentage of foreign sales, capital intensity, operating margins and size of employee population.

Following this evaluation, AT&T, Inc., Cisco Systems, Inc., Comcast Corporation, Deere & Company, Intel Corporationa comprehensive reevaluation and Walmart, Inc. were addedrevisions to the peer group and The Coca-Cola Company, Costco Wholesale Corporation, Delta Airlines, Inc., Sysco Corporation, Raytheon Technologies Corporation, and Walgreens Boots Alliance, Inc. were removed. The updatedin 2021, the compensation peer group consistedconsists of the following:

AT&T, Inc.FedEx CorporationMcDonald’s Corp.
The Boeing CompanyThe Home Depot, Inc.PepsiCo, IncInc.
Caterpillar Inc.Intel CorporationThe Procter & Gamble Company
Cisco Systems, Inc.Johnson & JohnsonTarget Corp.
Comcast CorporationLockheed Martin CorporationWalmart, Inc.
Deere & CompanyLowe’s Companies, Inc.
Internal Compensation Comparisons and Annual Performance Reviews

In addition to peer group analyses, the Committee considers other market data, including general compensation survey data from comparably sized companies. For 2021, the Committee utilized the prior peer group and 2021 compensation was not targeted to a particular percentile within that peer group or otherwise.

Internal Compensation Comparisons

The Committee also generally considers the compensation differentials between executive officers and other UPS positions, and generally considers the additional responsibilities of the CEO compared to other executive officers. Internal comparisons help ensure that executive officer compensation is reasonable when compared to that of direct reports.

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Annual Performance Reviews

The CEO assesses the performance of all other executive officers each year and provides feedback to the Committee. In addition, the Committee evaluates the CEO’s performance on an annual basis. The Committee Chair discusses the results of this evaluation with the full board (other than the CEO) in an executive session. As part of this evaluation, the board considers the CEO’s strategic vision and leadership, execution of UPS’s business strategy, and achievement of business goals. Other factors include the CEO’s ability to make long-term decisions that create a competitive advantage, and overall effectiveness as a leader.

Key Elements of
UPS Executive Compensation(1)

Other Elements of Compensation
BenefitsPerquisitesRetirement Programs

 NEOs generally participate in the same plans as other employees.

 Includes medical, dental, and disability plans that mitigate the financial impact of illness, disability or death.

 See further details on page 40.

 Limited in nature; benefits outweigh the costs.

 Includes financial planning and executive health services that facilitate the NEOs’ ability to carry out responsibilities, maximize working time and minimize distractions.

 Considered necessary or appropriate to attract and retain executive talent.

 See further details on page 40.

 NEOs and most non-union U.S. employees participate in the same qualified plans with the same formulas.

 Includes qualified and nonqualified pension, retirement savings and deferred compensation plans.

 See further details on page 49.

(1)Excludes a special equity award granted to an NEO as recognition of extraordinary contributions and performance during 2020.Base Salary

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Executive Compensation

Base Salary

Base salaries provide our NEOs with a fixed level of cash compensation and are designed to provide an appropriate level of financial certainty. The Committee considers several factors in determining NEOs’ annual base salaries, including Company and individual performance, scope of responsibility, leadership, market data and internal compensation comparisons.

Taking all of those factors into account, in March 2021,2023, the Committee approved a 9.2%determined not to increase the CEO’s base salary, increase for our CEO andbut to make market-based adjustments to her incentive compensation targets as discussed below. The Committee approved increases of between 2.5%3.0% and 12%4.0% for the other NEOs.

Management Additionally, as a component of the pay mix redesign approved in November 2022 and discussed below under “Management Incentive Program - Annual Awards Overview

Overview”, further base salary adjustments for each NEO of less than 3.5% were made effective beginning in January 2023.

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Management Incentive Program - Annual Awards Overview
The UPS Management Incentive Program (“MIP”) motivates management and alignsby aligning pay with annual Company performance. This is accomplished by linking payouts to the achievement of pre-established metrics and individual performance and stock ownership.

performance.

Annual MIP performance incentive award opportunities are provided as a percentage of base salary. Incentive award payouts are determined by the Committee, taking into consideration:

actual performance compared to MIP targets (described below);
the MIP payout as a percent of target to non-executive officer MIP participants;
individual performance; and
the overall business environment and economic trends.

In addition, we encourage employees to maintain a substantial ownership interest in UPS stock through equity compensation programs, including our MIP ownership incentive award. All MIP participants are eligible for an ownership incentive award up to the equivalent of one month’s salary by maintaining significant ownership of UPS equity securities. The amount of the award is equal to the value of the participant’s equity ownership as of December 31 of each year, multiplied by an ownership incentive award percentage set out below, up to a maximum award of one month’s salary. The MIP ownership incentive award, to the extent earned, is paid in the same proportion of cash and equity as the MIP performance incentive award.

Ownership levels are determined by totaling the number of UPS shares in the participant’s family group accounts and the participant’s eligible unvested restricted units and deferred compensation shares. The number of UPS shares determined for purposes of an NEO’s ownership level is multiplied by the closing price of a class B share on the NYSE on the last trading day of the year.

MIP awards are considered fully at risk based on Company performance and subject to a $5maximum payout of the lesser of $10 million maximumor 200% of target for each NEO. Following

MIP payouts are determined by the Committee’s approval, Committee taking into consideration:
actual performance compared to MIP targets (described below);
the portionMIP payout as a percent of target to non-executive officer MIP participants; and
the earnedoverall business environment and economic trends.
Based on an evaluation of our incentive compensation plan structure with the assistance of FW Cook, in November 2022, the Committee approved changes to the overall pay mix for MIP participants, including the NEOs (“pay mix redesign”). These changes resulted in better alignment of annual incentive pay with market practices, improved the competitiveness of base salaries and simplified compensation design.
Changes included the following, all of which were effective beginning with the 2023 MIP award:
MIP awards are now paid in cash, unless a participant elects to receive the award isin shares; previously MIP awards were generally paid two-thirds in restricted performance units (“RPUs”) and one-third in cash. The numbercash;
Ownership incentive portions of RPUs granted is determined by dividing the dollarMIP awards, which were tied to an individual’s UPS equity ownership, were discontinued, with a generally equivalent value of the portion of the incorporated into base salary adjustments; and
MIP award paidtargets as a percentage of base salary were reduced from 130% to 115% for NEOs (other than the CEO) to account for increases in RPUs bybase salaries; the closing priceCEO’s award target was maintained at 200% of our class B common stock onbase salary following an evaluation of market-competitive incentives.
2023 MIP Awards
After taking into account the NYSE onchallenging economic environment including Company labor uncertainty, as well as the grant date.

When dividends are paid on UPS common stock, an equivalent value is credited to the participant’s bookkeeping accounteffectiveness of similar approaches in additional RPUs. RPUs generally vest onrecent years, in the first anniversaryquarter of the grant date, furthering the retention component of the award, and are settled in shares of class A common stock.

To further our stock ownership philosophy, initial MIP awards earned by newly hired employees are paid entirely in vested class A shares, with no cash component.

2021 MIP Performance Incentive Awards

In February 2021, the Committee adopted financial performance metrics for the NEOs’ MIP performance incentive awards as follows:

Adjusted Consolidated Revenue Growth, which is measured as year-over-year growth in revenue from all products and services worldwide. Revenue growth is calculated on a constant currency basis and is important to generating profits and maintaining our long-term competitive positioning and viability.
Adjusted Consolidated Operating Profit Growth, which is measured as year-over-year growth in operating profits on a constant currency basis. For purposes of measuring this growth, operating profit was determined by reference to our publicly reported adjusted operating profit for each of 2020 and 2021. This growth is directly impacted by our effectiveness in achieving our targets in other key performance elements, including volume and revenue growth and operating leverage.
Return on Invested Capital, which is calculated as the trailing twelve months of adjusted operating income divided by the average of current assets, current liabilities, goodwill, intangible assets, net property, plant and equipment, other assets, and right-of-use-assets-operating lease. We consider ROIC to be a useful measure for evaluating the effectiveness and efficiency of our long-term capital investments. ROIC is calculated by reference to our publicly reported adjusted operating profit.

After monitoring and considering the economic impact and continued uncertainty caused by the coronavirus pandemic, including the challenges around longer-term forecasting,2023 the Committee determined it wasremained appropriate to bifurcate the performance period for the 20212023 MIP award into two six-month performance periods (January through June 2023 and July through December 2023), with each performance period accounting for 50% of the overall

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2021Beginning with the 2024 performance period, the Committee has returned to full-year goal setting for MIP award.awards. The Committee discussedapproved the following financial performance metrics for the NEOs’ 2023 MIP awards as follows:

Revenue (weighted 20%), which was considered important to generating profits and maintaining our long-term competitive positioning and viability through 2023.
Adjusted Operating Profit (weighted 40%), which is determined by reference to our publicly reported adjusted operating profit for 2023. This metric is directly impacted by our effectiveness in achieving our targets in other key performance elements, including volume and revenue growth and operating leverage.
Adjusted Return on Invested Capital (“ROIC”) (weighted 40%), which is calculated as the trailing twelve months of adjusted operating income divided by the average of current assets, current liabilities, goodwill, intangible assets, net property, plant and equipment, other assets, and operating lease right-of-use assets. We consider ROIC to be a useful measure for evaluating the effectiveness and efficiency of our long-term capital investments. ROIC is calculated by reference to our publicly reported adjusted operating profit.
The Committee approved financial performance goals after discussing with management and its independent compensation consultant expected financial performance risks related to the potential severity and duration of the coronavirus pandemic, and the other mattersrisks described above. The performance goals for the first performance period were set in February 2021in the first quarter of 2023 and the performance goals for the second performance period were set in August 2021. the third quarter 2023, in each case without a threshold and with a maximum payout of the lesser of $10 million or 200% of target.
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37


The financial performance goals approved by the Committee, and the performance results, were as follows:

2021 MIP Financial Performance
Metrics(1)
First
 Half
 2021
 Goal
 First
 Half
 2021
 Actual
 Second
 Half
 2021
 Goal
 Second
 Half
 2021
 Actual
Adjusted Consolidated Revenue Growth7.4%20.1%5.4%10.8%
Adjusted Consolidated Operating Profit Growth22.1%79.9%10.1%31.8%
Return on Invested Capital23.2%27.4%28.0%29.8%
(1)Non-GAAP financial measures. See footnote on page 38.

follows (dollars in millions):

2023 MIP Financial Performance Metrics
First
 Half
2023
 Goal
First
 Half
 2023
 Actual
Second
 Half
 2023
 Goal
Second
 Half
2023
 Actual
Revenue$47,247$44,988$48,123$46,044
Adjusted Operating Profit(1)
$5,918$5,452$5,473$4,418
Adjusted ROIC(1)
28.6%27.4%24.7%21.9%
(1)Non-GAAP financial measures. See footnote on page 40.
The Committee maintains discretion to adjust awards earned under the MIP up (but not above the maximum amount for each NEO) or down based on its qualitative assessment of each NEO’s individual performance. With respect to the CEO’s MIP award, the Committee considers the results of the board’s annual evaluation of the CEO, which includes ratings on:

leadership qualities;
strategic planningperformance and execution;
managing for financial results;
retaining and developing a diverse top management group;
providing equal opportunity employment, and understanding and addressing issues facing employees;
ensuring the Company contributes to the well-being of the communities in which it operates;
promoting compliance and ethical behavior; and
board relations.

For NEOs other than the CEO, the Committee takes into consideration the recommendations of the CEO. Individual accomplishments during 2021 that were considered by the Committee when determining final awards are described below.

Carol Tomé

Carol continued the tremendous momentum of the previous year, leading the team to deliver the highest revenue and profit in the Company’s history for the second straight year. In keeping with the “better, not bigger” theme, Carol executed the strategy to improve revenue quality and productivity, and realigned the portfolio by successfully directing the divestiture of UPS Freight and the acquisition of Roadie, Inc. Carol’s tenacity to improve the customer experience accelerated significant upgrades to digital platforms, which simplified shipping solutions and resulted in new growth. Carol commissioned the development of a new ESG strategy, demonstrating renewed commitment to inclusion by setting DEI goals and establishing the goal to be carbon neutral by 2050. During a difficult business climate, the execution of Carol’s strategy led to expanded margins, record financial results, and total shareowner value growth of approximately thirty percent in 2021.

Brian Newman

In 2021, Brian maintained a relentless focus on revenue management and led a disciplined capital allocation approach which resulted in record revenue and profitability across all three business segments. Brian successfully oversaw the UPS Freight divestiture and was instrumental in navigating the Roadie, Inc. acquisition. Ending the year with more than $10.0 billion in cash, Brian’s actions also secured a solid investment grade credit rating. Brian’s leadership significantly contributed to the growth of total shareowner value by approximately thirty percent in 2021.

Scott Price

Despite an uncertain global economy linked to the lingering pandemic, Scott’s actions secured record profits, margin and return on invested capital. Scott reset the International growth strategy and instilled a customer first mindset, spearheading a customer experience improvement plan. He led the team to achieve total and premium committed service goals, deliver an improved brokerage experience and enhance the claims process. Under Scott’s leadership, U.S. exports were accelerated, productivity targets were achieved, and a new partnership was formed with a joint venture, setting the stage for future global growth.

Nando Cesarone

Nando’s actions resulted in outstanding results in 2021, delivering industry-leading service levels to customers while facilitating a smooth peak season despite numerous obstacles. As the pandemic continued to impact the global supply chain, he led the team with agility by adjusting network operating plans to align capacity with demand. Nando re-imagined U.S. Operations by restructuring the organization and prioritizing training investments, which resulted in significant service and productivity improvements. In collaboration with his partners, Nando drove positive operating leverage by growing revenue in profitable segments while reducing expense. Nando was instrumental in helping deliver the highest revenue and profits in our Company’s history.

Kate Gutmann

In 2021, Kate implemented the customer contract renewal strategy with laser focus on revenue management, while maintaining positive customer relationships. Under her leadership, the small and medium-sized business segment yielded double digit growth. Kate deftly coordinated activities between customers and operations to manage network capacity throughout peak season. Kate aggressively leaned into sales transformation. She led impactful healthcare business growth and profitability, better positioning UPS as an industry partner of choice. Kate was instrumental in UPS achieving historic results in growth and profitability.

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Executive Compensation

2021 MIP Payout

After assessing the above-described considerations, thefactors. The Committee approved the following MIP award payouts for each NEO.

Name     Incentive
Target (%
Base Salary)
     Incentive
Target
Value ($)
     Actual
Incentive
Value ($)
     Ownership
Award
Percentage (%
of ownership)
     Maximum
Ownership
Award
Value ($)
     Actual
Ownership
Award
Value ($)
     Total 2021
MIP Award
Payout ($)
Carol Tomé 200% 2,730,000 4,095,000 1.25% 113,750 96,416 4,191,416
Brian Newman 130% 995,062 1,492,592 1.50% 63,786 63,786 1,556,378
Scott Price 130% 894,941 1,342,411 1.50% 57,368 38,046 1,380,457
Nando Cesarone 130% 912,818 1,369,228 1.50% 58,514 58,514 1,427,742
Kate Gutmann 130% 981,224 1,471,837 1.50% 62,899 62,899 1,534,736

Long-Term Incentive Awards

Name
Incentive
Target
(% Base Salary)
Incentive
Target Value
($)
Payout Factor
(%)
Total 2023
MIP Award
Payout
($)
Carol Tomé2003,019,42550%1,509,713
Brian Newman115963,38450%481,692
Nando Cesarone115975,67450%487,837
Kate Gutmann115975,67450%487,837
Bala Subramanian115889,13350%444,567
Long-Term Incentive Awards
Our two long-term incentive programs, the Long-Term Incentive Performance (“LTIP”) program and the Stock Option program, provide participants with equity-based incentives that reward performance over a multi-year period and serve as a retention mechanism. Overlapping LTIP performance cycles incentivize sustained financial performance. The Stock Option program rewards stock price appreciation, which is directly linked to shareowner returns. A summary of these two programs follows:

ProgramPerformance Measures and/or Value
Proposition for 20212023 Awards(1)
Payment Form and Program TypeProgram Objectives
LTIP

Adjusted Earnings Per Share Growth

Adjusted Free Cash Flow

Relative Total Shareowner Return as a modifier

Value increases or decreases with stock price

If earned, RPUs are settled in stock

If earned, RPUs generally vest at the end of the three-year performance period

Supports long-term operating plan and business strategy

Significant link to shareowner interests

Stock OptionValue recognized only if stock price appreciatesStock options generally vest 20% per year over five years and have a ten-year term

Significant link to shareowner interests

Enhance stock ownership and shareowner alignment

(1) As described below, prior to 2020, the LTIP performance measures were growth in adjusted consolidated revenue, adjusted return on invested capital and relative total shareowner return. Each performance measure was equally weighted and accounted for one-third of the award payout.

Total Long-Term Equity Incentive Award Target Values

LTIP

Long-term equity incentive award target values are determined based on internal pay comparison considerations and market data regarding total compensation for comparable positions at similarly situated companies. After considering these factors, in 2021 the Committee increased Carol’s LTIP target RPU value from 735% of base salary. Differences in the target award values are based on varying levels of responsibility among the NEOs. In connection with the Committee’s March 2023 evaluation of CEO target total direct compensation as described above, the Committee determined it was appropriate to increase the CEO’s LTIP target opportunity from 835% to 1,035%.
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Notice of Annual Meeting of Shareowners and 2024 Proxy Statement


The LTIP target opportunity and Stock Option Awardaward value granted to eligible NEOs in 2021,2023, expressed as a percentage of annualized base salary, is shown below.

Name     LTIP Target
RPU Value
(% Base Salary)
     Option
Value
(% Base
Salary)
     Total
Value
(% Base
Salary)
Carol Tomé 760 90 850
Brian Newman 550 50 600
Scott Price 450 50 500
Nando Cesarone 450 50 500
Kate Gutmann 350 30 380
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Name
LTIP Target
RPU Value
(% Base Salary)
Option
Value
(% Base Salary)
Total
Value
(% Base Salary)
Carol Tomé1,035901,125
Brian Newman55050600
Nando Cesarone45050500
Kate Gutmann45050500
Bala Subramanian45050500

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LTIP Program

Overview

The LTIP program strengthens the performance-based component of executive compensation, promotes longer-term focus, enhances retention of key talent, and aligns the interests of shareowners with the incentive compensation opportunity for executives. Approximately 500 members of our senior management team, including the NEOs, participate in this program. The program combines internal and external relative business performance measures with the goal of motivating and rewarding management for operational and financial success, while helping to ensure rewards are alignedalign with shareowner interests and returns.

Participants receive a target award of RPUs at the beginning of the three-year performance period. The number of RPUs that NEOs can earn is shown in the “Grants of Plan-Based Awards” table. The actual number of RPUs that NEOs earn will beis determined following the completion of the performance period and is based on achievement of the performance measures described in more detail below.

Dividends payable on the number of shares underlying participants’ RPUs are allocated in the form of dividend equivalent units (“DEUs”). DEUs are subject to the same conditions as the underlying award. Awards that vest are distributedsettled in shares of class A common stock. Special vesting rules apply to terminations subject to the UPS Key Employee Severance Plan or terminations by reason of death, disability or retirement during the performance period, asperiod. These special vesting rules are discussed under “Potential Payments Upon Termination or Change in Control.”

The performance measures selected by the Committee for the 20212023 LTIP awards were adjusted earnings per share growth and adjusted free cash flow. Each measure willflow, each to be evaluated independently and appliedweighted equally in determining the final payouts.payout percentage. The final payout percentage for the LTIP award will be subject to modification based on the Company’s relative total shareholdershareowner return (“RTSR”) as a percentile rank relative to the total shareholder return on the stocks of the companies listed on the Standard & Poor’s 500 Composite Index (the “Index”). during that same period. The maximum LTIP award that can be earned is 220% of target. A description of each performance measure and the operation of the RTSR modifier follows:

Adjusted Earnings Per Share Growth1

follows.

Adjusted Earnings Per Share1
Adjusted earnings per share growth measures our success in increasing profitability as compared with targets adopted atprofitability. At the beginning of the January 1, 2023 performance period.period, the Committee established adjusted earnings per share targets for the three-year performance period taking into account the challenging economic environment, including Company labor uncertainty, that added complexity and uncertainty to long-term forecasting at the time. Adjusted earnings per share is determined by dividing the Company’s adjusted net income available to common shareowners by the diluted weighted average shares outstanding during the performance period. For this purpose, adjusted net income is determined by reference to our publicly reported adjusted net income. The adjusted earnings per share target for 2023 is the projected adjusted earnings per share for that year. The adjusted earnings per share growth target for the remainder of the performance period is the projected average annual adjusted earnings per share growth during each of the remaining years withinin the applicable performance period. The actual adjusted earnings per share growth for each year of the applicable performance periodyear will be compared to the target and assigned a payout percentage; the average of the three payout percentages will be used to calculate the final payout percentage under this metric. Following the completion of the applicable performance period, the Committee will certify (i) the actual adjusted earnings per share growth for the performance period;2023; (ii) the actual adjusted earnings per share growth for each of the remaining years in the performance period; (iii) the actual adjusted earnings per share growth for the applicable portion of the performance period as compared to the target; and (iii)(iv) the final payout percentage for this metric.

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Adjusted Free Cash Flow139



Adjusted Free Cash Flow1
Adjusted free cash flow measures our ability to generate cash after accounting for capital expenditures. Adjusted free cash flow is determined by reducing the Company’s adjusted cash flow from operations by adjusted capital expenditures and proceeds from disposals of fixed assets, and adjusting for net changes in finance receivables, other investing activities and discretionary pension contributions. The adjusted free cash flow target is the projected aggregate adjusted free cash flow generated during the applicable performance period. Following the completion of the applicable performance period, the Committee will certify (i) the actual adjusted free cash flow for the performance period; (ii) the actual adjusted free cash flow for the performance period as compared to the target; and (iii) the final payout percentage for this metric.

(1)Non-GAAP financial measures. We believe that these non-GAAP measures are appropriate for the determination of our incentive compensation award results because they exclude items that may not be indicative of, or are unrelated to, our underlying operations and provide a useful baseline for analyzing trends in our underlying business. Non-GAAP financial measures should be considered in addition to, and not as an alternative for, our reported results prepared in accordance with GAAP. Our non-GAAP financial information does not represent a comprehensive basis of accounting. Therefore, our non-GAAP financial information may not be comparable to similarly titled measures reported by other companies.
Relative Total Shareowner Return

Total shareholder returnShareowner Return

RTSR is the total return on an investment in UPS stock to an investor (stock price appreciation plus dividends). ThisTotal return is compared with the total return on the stock ofan investment in the companies in the Index at the beginning of the applicable performance period. The Committee will assign a percentile rank relative to the companies listed in Index based on RTSR. Following the completion of the Performance Period,performance period, the Committee will certify the Company’s RTSR and the payout modifier for that performance period, if any, as follows:

RTSR Percentile Rank
Relative to Index
Payout
Modifier
Above 75th percentile
+20%
Between 25th and 75th percentile
None
Below 25th percentile
-20%
(1)Non-GAAP financial measures. We believe that these non-GAAP measures are appropriate for the determination of our incentive compensation award results because they exclude items that may not be indicative of, or are unrelated to, our underlying operations and provide a useful baseline for analyzing trends in our underlying business. Non-GAAP financial measures should be considered in addition to, and not as an alternative for, our reported results prepared in accordance with GAAP. Our non-GAAP financial information does not represent a comprehensive basis of accounting. Therefore, our non-GAAP financial information may not be comparable to similarly titled measures reported by other companies.
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Executive Compensation

20192021 LTIP Award Payout

The 2021 LTIP award payout was determined following the completion of the Company’s 2023 fiscal year. The performance metrics for 2019 LTIP awards were growth in adjusted consolidated revenue, adjusted operating return on invested capital and RTSR (for the 20192021 LTIP award RTSR was a separate performance metricwere adjusted earnings per share and not a modifier),adjusted free cash flow, each as described in our proxy statement for our 2020 annual meeting of shareowners. Each of the three metrics was evaluated independently and weighted equally in determining award payouts.weighted. The final payout was subject to modification based on RTSR. Performance targets and actual results for the completed performance period for the 20192021 LTIP awards (January 1, 2019 through December 31, 2021)award are set out below. RPUs awardedearned under the 20192021 LTIP are considered earnedvested and vested.

Growth in adjusted consolidated revenue was calculated on a constant currency basis using 2019 levels as the baseline. Adjusted consolidated revenue and adjusted operating return on invested capital were adjusted for the divestiture of UPS Ground Freight, Inc.
** Growth in adjusted consolidated revenue is measured annually, with payout maximized if growth of at least 8.9% is achieved in that year. The final result is an average of the three outcomes within the performance period. This method may result in a higher or lower payout than a three-year compound growth calculation, depending upon performance in each of the individual years.
   39

Tableare settled in shares of Contents

class A common stock.

2021 LTIP Metrics
Adjusted Earnings Per ShareAdjusted Free Cash FlowRTSR
YearThresholdTargetMaximumActualThresholdTargetMaximumActualActual
20213.4%8.4%13.6%47.4%$17,369$24,813$32,257$25,18127th
20229.0%6.7%
202313.2%(32.1)%
2021 LTIP Final Results
Performance PeriodAdjusted EPS PayoutAdjusted FCF PayoutPerformance Payout (Avg)RTSR ModifierFinal Payout
2021-202391%104%98%—%98%
Stock Option Program and 20212023 Stock Option Awards

Stock optionsoption awards create a direct link between Company performance and maximization of shareowner value, and haveas well as provide retention value. Our stock optionsStock option awards generally vest 20% per year over five years and expire ten years from the date of grant. WeBeyond vesting periods, we do not maintainimpose additional holding period requirements. TheStock option holder will not receive any value unless they remain employedawards generally require continued employment during the vesting period. Unvested stock options vest automatically upon termination of employment because ofdue to death, disability or retirement. Stock option awards are
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Notice of Annual Meeting of Shareowners and 2024 Proxy Statement


also subject to the UPS Key Employee Severance Plan as discussed under “Potential Payments Upon Termination or Change in Control”. Grants do not include dividend equivalentsDEUs or reload features. The number of stock options granted to the NEOs in 20212023 is shown in the “Grants of Plan-Based Awards” table.

Employment Transition Awards, Retention Arrangements and Recognition Awards

Employment Transition Awards, Retention Arrangements and Recognition Awards
Generally, we do not pay discretionary bonuses in cash or stock, or make other discretionary payments, to our executives. In recent periods, however, to attract and retain senior executive talent, to participate in the transformation of our business, the Committee determined it was appropriate to approveapproved certain limited payments to external executives hiredhires to the Company’s Executive Leadership Team. A portion of thethese payments to the external hires werewas made to compensate the executives for compensation forfeited at their prior employers and transition them into our incentive programs. Any of these payments impacting 2023 compensation are described below. In addition, in connection with the hiring of Carol Tomé as CEO in 2020, the Committee determined it was appropriate to provideprovided certain incentives to various executive officers in 2020 in order to provide forhelp ensure the retention of their services through a transition period.

Bala Subramanian joined the Company in July 2022 as Chief Digital and Technology Officer. The Committee, working with FW Cook and considering market compensation data and internal pay equity factors, approved his compensation package described below. Under the terms of his employment offer letter, Bala is entitled to: (i) a RSU grant valued at $3,000,000, vesting 50% in July 2023 and 50% in July 2024; (ii) cash transition payments of $250,000 in each of August 2022, January 2023, July 2023 and January 2024; (iii) a RPU grant valued at $1,000,000, vesting in December 2023, with the actual payout determined based on the Company’s performance under its 2021 LTIP program; and (iv) a prorated 2022 LTIP award. Payments are subject to his continued employment through the applicable vesting or payment dates, or termination without cause.
Further, in 2021 the Committee granted Kate Gutmann a one-timespecial award valued at $350,000 in recognition of her extraordinary contributions and performance during 2020. This award consisted of $175,000 ofin RSUs which vest as follows: 25 percent on March 25, 2022; 25 percent on March 25, 2023; and 50 percent on March 25, 2024; and a stock option award with a grant date fair value of $175,000 which vests 20% per year over five years beginning on March 25, 2022, provided generally that she remains an employee of UPS through the applicable vesting dates.

Under the terms of his 2019 employment offer letter, Brian Newman was entitled to: (i) a grant of RSUs with a value of $5,500,000, which vested in March 2020; (ii) a performance-based cash award with a target value of $3,000,000, payable in equal installments in March 2021 and March 2022, with the actual payout equal to the Company’s LTIP payout percentage based on the Company’s performance under the LTIP for periods ending December 31, 2020 and December 31, 2021, respectively; and (iii) a cash transition payment of $600,000 paid in March 2020. These amounts are subject to repayment on a prorated basis if he resigns without “good reason” or is terminated for “cause” within 36 months following his September 2019 start date.

Under the terms of his 2017 employment offer letter, Scott Price was entitled to: (i) a RSU grant valued at $4,000,000 vesting in 20% equal annual increments beginning January 2018, subject to his continued employment through each applicable vesting date or termination without cause; (ii) cash transition payments of $2,000,000 in each of March 2019 and 2020.

In connection with our 2020 CEO transition, in May 2020, we entered into retention arrangements with each of Nando Cesarone and Kate Gutmann. The Committee initially intended that these agreements contain both performance and time vesting components, and that the performance components be different than the metrics under our MIP and LTIP programs. Due to the uncertainty created by the COVID-19coronavirus pandemic and the importance of the retention agreements to the Company, the Committee ultimately determined that the awards would only be time based. Nando and Kate each received RSUs valued at $3.0 million in RSUs which vestvested as follows: 25% on May 13, 2021, 25% on May 13, 2022 and 50% on May 13, 2023, provided they remain an employee of UPS through the applicable vesting date. In accordance with the rules and regulations of the SEC, the full value of these awards is included in each individual’s 2020 compensation as reported in the 2021 Summary Compensation Table.2023. These agreements contain customary non-competition, non-solicitation and non-disclosure covenants in favor of the Company.

Benefits and Perquisites

Benefits and Perquisites
The benefits and perquisites provided to our NEOs are not a material part of executive compensation and are largely limited to those offered to our employees generally, or that we otherwise believe are necessary or appropriate to attract and retain executive talent.
We believe certain perquisites help facilitate our NEOs’ ability to carry out their responsibilities, maximize working time and minimize distractions. Additional information on these benefits can be found in the following program descriptions.

The

UPS 401(k) Savings Plan

The UPS 401(k) Savings Plan is open to all U.S.-based employees who are not subject to a collective bargaining agreement and who are not eligible to participate in another savings plan sponsored by UPS or one of its subsidiaries. We generally match 50% of up to 5%6% of eligible pay contributed to the UPS 401(k) Savings Plan for eligible employees hired on or before December 31,

40      Notice of Annual Meeting of Shareowners and 2022 Proxy Statement

Table of Contents

Executive Compensation

2007, 100% of up to 3.5% of eligible pay contributed to the plan for eligible employees hired on or after January 1, 2008, and 50% of up to 6% of eligible pay contributed to the plan for employees hired on or after July 1, 2016.employees. The match is paid in shares of class A common stock. Effective for newly eligible plan participantsquarterly according to the participant's pre-tax investment elections on or after July 1, 2016, wefile with the record keeper. We also generally provide a Retirement Contributionan annual contribution based on years of service and expressed as a percentage of eligible compensation (5% for 0-4 years, 6% for 5-9 years, 7% for 10-14 years and 8% for 15 or more years).

For employees who were hired prior to 2008 and are participants in the Final Average Compensation (FAC) formula of the UPS Retirement Plan, we generally make an annual transition contribution of 5% of eligible compensation for plan years 2023-2027, which will increase to 7% beginning in 2028.

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Qualified and Non-Qualified Pension Plans

Certain executive officers are eligible to participate in our qualified retirement program, the UPS Retirement Plan. Benefits payable under the plan are subject to the maximum compensation limits and the annual benefit limits for a tax-qualified defined benefit plan as established by the Internal Revenue Service. Amounts exceeding these limits are paid pursuant to the UPS Excess Coordinating Benefit Plan, which is a non-qualified restoration plan designed to replace the benefits limited under the tax-qualified plan. Without the Excess Coordinating Benefit Plan, the executive officers would receive a lower benefit as a percent of final average earnings than the benefit received by other participants in the UPS Retirement Plan. In accordance with the terms of the Excess Coordinating Benefit Plan, following a participant’s retirement, the Company pays an amount equal to the Social Security and Medicare taxes due on the present value of the benefits provided under the plan.

Financial Planning Services

Our executive officers are eligible for a financial services benefit. The Company reimburses fees from financial and tax service providers up to $15,000 per year, including the cost of personal excess liability insurance coverage.

Executive Health Services

Our executive officers are eligible for certain executive health services benefits, including comprehensive physical examinations. UPS’s business continuity is best facilitated by avoiding any prolonged or unexpected absences by members of its senior management team.

Discounted Employee Stock Purchase Plan

Our Discounted Employee Stock Purchase Plan provides all U.S.-based employees, including the NEOs, and some internationally based employees, the opportunity to purchase up to $10,000 in our class A common stock annually at a discount to the market price. Our class A common stock may be acquired under the plan at a purchase price equal to 95% of the fair market value of the shares on the last day of each calendar quarter. The plan complies with Section 423 of the Internal Revenue Code.

Other Compensation and Governance Policies

Other Compensation and Governance Policies
Stock Ownership Guidelines

CEO= 8x annual salary
Other Executive Officers= 5x annual salary
Directors= 5x annual retainer

We maintain

Our stock ownership guidelines that apply to executive officers and members of the board. Shares of class A common stock (excluding any pledged shares), deferred units and vested and unvested RSUs and RPUs awarded under our equity incentive plans are considered owned for purposes of calculating ownership. Executive officers and directors are expected to reach target ownership within five years of the date that the executive officer or director became subject to the guideline.

As of December 31, 2021,2023, all of the NEOs who have been subject to the guidelines for at least five years exceeded their target stock ownership. In addition, all non-employee directors who have been subject to the stock ownership guidelines for at least five years exceeded their target stock ownership. RSUs are required to be held by non-employee directors until separation from the board.

Hedging and Pledging Policies

We prohibit our executive officers and directors from hedging their ownership in UPS stock. Specifically, they are prohibited from purchasing or selling derivative securities relating to UPS stock and from purchasing financial instruments that are designed to hedge or offset any decrease in the market value of UPS securities. Additionally, we have adopted a policy prohibitingprohibit our directors and executive officers from entering into pledges of UPS securities, including using UPS securities as collateral for a loan and holding UPS securities in margin accounts. Furthermore, our employees, officers and directors are prohibited from engaging in short sales of UPS stock.

Incentive-Based Compensation Clawback Policy

Our incentive

We have adopted an incentive-based compensation plans contain clawback provisions applicable to all outstanding awards. Ifpolicy that complies with NYSE requirements. This policy provides for the Committee determines that financial results used to determinerecovery of the amount of any award are materially restated, and thaterroneously awarded incentive-based compensation received by executive officers when the Company is required to prepare an executive officer engagedaccounting restatement, subject to limited exceptions in fraud or intentional misconduct,accordance with the Committee is entitled to seek repayment or recovery of the award from that executive officer.

NYSE requirements.
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Notice of Annual Meeting of Shareowners and 2024 Proxy Statement

Employment and Severance Arrangements; Change in Control Payments

UPS has created a culture where long tenure for executives is the norm. Consequently, we

We do not enter into agreements providing for the continuation of employment, or separate change in control agreements with any of our executive officers, including our NEOs, or other U.S.-based non-union employees.

However, in recent periods, to attract and retain senior executive talent to participate in the transformation of our business and in furtherance of the board’s succession planning efforts, we have entered into various employment offer letters, transition agreements, retention arrangements and noncompetenon-compete agreements in favor of UPS. These arrangements may provide for compensation to an executive, but do not guarantee an employment term; employment is on an at-will basis. Some of the agreements were designed to compensate the individuals for compensation forfeited at their prior employers, to transition them into our incentive programs or to provide consideration for their agreement not to compete with UPS following their potential separation. In addition, potential compensation provided by retention arrangements isare intended to incentivize those individuals to maintain their employment with UPS.

To the extent any agreements entered into with any of the NEOs contain ongoing obligations of the Company, those agreements are described below.

Subramanian Employment Offer Letter
In connection with herhis appointment as Chief ExecutiveDigital and Technology Officer, on March 11, 2020,May 24, 2022, the Company entered into an employment offer letter with Carol Tomé providing for: (i) an annual base salary of $1,250,000 (subject to future increase); (ii) a MIP award target of 165% of base salary; (iii) a LTIP program award target of 735% of base salary; and (iv) a stock option grant target of 90% of base salary.

Carol also entered into a protective covenant agreement, which protects UPS’s confidential information and includes non-competition and non-solicitation covenants in favor of UPS. It also provides for continued payment of her base salary for up to 24 months if her employment is terminated by UPS without “cause” within two years following her start date. In the event she is terminated without cause after the first two years of employment, the Company is obligated to make such payments if it elects to enforce the post-termination non-compete covenants.

In connection with his appointment as Chief Financial Officer, on August 7, 2019, the Company entered into an employment offer letter with Brian NewmanBala Subramanian providing for: (i) an annual base salary of $725,000 (subject to future increase); (ii) a MIP award target for 2022 of 130% of base salary; (iii) aan LTIP program award target of 550%450% of base salary;salary (his final 2022 LTIP award payout will be prorated based on his July 2022 start date); (iv) a stock option grant target of 50% of base salary;salary (commencing in 2023); (v) aan initial grant of UPS restricted stock units with a value of $5,500,000, which vested in March 2020; (vi) a performance-based cash award with a target value ofRSUs valued at $3,000,000, which was paidgenerally vests 50% in equal installmentsJuly 2023 and 50% in March 2021July 2024; (vi) cash transition payments of $250,000 in each of August 2022, January 2023, July 2023 and March 2022, based onJanuary 2024; and (vii) an initial RPU grant valued at $1,000,000, generally vesting in December 2023, with the Company’sfinal number of RPUs subject to performance under the 2021 LTIP for periods ending December 31, 2020 and December 31, 2021, respectively; and (vii) a cash transitionaward. Payments are subject to his continued employment through the applicable vesting or payment dates, or termination without cause. Certain of $600,000 paid in March 2020.

Thesethese amounts are subject to repayment on a prorated basis if he resigns without “good reason” or is terminated for “cause”cause within 36 months following his September 2019July 2022 start date.

Under the terms

Protective Covenant Agreements
Each of his 2017 employment offer letter, Scott Price was entitled to: (i) a RSU grant valued at $4,000,000 vesting in 20% equal annual increments beginning January 2018, subject to his continued employment through each applicable vesting date or termination without cause; and (ii) cash transition payments of $2,000,000 in each of March 2019 and 2020.

Brian and Scott alsoour NEOs have entered into protective covenant agreements with us,the Company, which protect UPS’s confidential information and include non-competition and non-solicitation covenants in favor of UPS. In the event that either of themCarol or Brian is terminated without cause, the Company is obligated to make separation payments equal to two years’ salary if it elects to enforce the post-termination non-compete covenants.

On March 1, 2022,

Key Employee Severance Plan
The UPS announced that Scott Price is retiring on March 31, 2022Key Employee Severance Plan (the “separation date”“Plan”). We have entered into a separation agreement with Scott (the “Price Separation Agreement”), pursuant to which we will provide certain provides for severance compensation and benefits upon certain terminations of employment of key employees, including the NEOs. The severance protections under the Plan replace cash severance benefits (if any) to Scott in lieu of any benefitswhich a participating employee would have otherwise been entitled under Scott’stheir protective covenant agreement. agreements.
The Price Separation AgreementPlan in general provides that Scottif the Company terminates a participant’s employment other than due to “Cause,” “Disability Termination,” or death (a “Qualifying Termination”), the Company will receive,pay: (i) an amount in addition to certain accrued compensation and benefits, a lump sum cash severance payment equal to $912,151.20, representing (A) one-year of base salary and (B) a pro-rata portion of Scott’s targetthe individual’s annual performance incentive award under the 2022 MIP. In addition, Scott’s equity awards outstanding asMIP that would have been earned for the year of the separation date will be treated as follows: (1) RPUs granted in 2022 with respect to the 2021 MIP will vest in full immediately following the separation date; (2) each RPU award granted under the LTIP will remain eligible to vesttermination, based on a pro-rata basis, subject to actual performance for the full performance period, with the pro-rata portion calculated based on the number of months during which the individual was employed by the Company during the applicable year; (ii) an amount in cash equal to one times (or, for the CEO, two times) the sum of the participant’s annual base salary plus the participant’s target MIP performance award in effect as of the termination date; (iii) an amount in cash equal to the portion of the participant’s monthly Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) premium for the participant and the participant’s dependents to the extent it exceeds the premiums paid by the participant for such coverage immediately prior to termination times the number of months in the participant’s applicable COBRA period; and (3) his outstanding(iv) career counseling services up to $20,000 (or, for the CEO, up to $30,000).
In addition, with respect to options held by retirement eligible employees, and RPUs granted under the MIP or LTIP, in each case granted on or after the effective date of the Plan, a participant who experiences a Qualifying Termination will generally be entitled to the same treatment that would apply in the event of “retirement” under the terms of such awards. With respect to stock options granted to a participant on or after the effective date of the Plan, such stock options (to the extent vested)the participant is not retirement eligible and that are vested as of the date of the Qualifying Termination) will remain exercisable for 90 days followinguntil the separation date. The Price Separation Agreement includes certain customary protective covenants in favorearlier of the Company, including confidentiality, employeefirst anniversary of the termination date and customer non-solicitation, non-competition, and non-disparagement provisions. For more information regarding these benefits, see “Potential Payments Upon Termination or the original expiration date of the stock options.
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Change in Control” below.

Under the terms of the retention arrangements with Nando Cesarone and Kate Gutmann, each entered into customary non-competition, non-solicitation and non-disclosure agreements in favor of the Company. If any of them are terminated without cause or resign for “good reason”, their RSU awards will continue to vest on the schedule above.

Control

All outstanding equity awards that are continued or assumed by a successor entity in connection with a change in control require a “double trigger” for vesting to accelerate; that is, they also require a qualifying termination of employment prior to any acceleration of vesting.

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Executive Compensation

Equity Grant Practices

Grants of awards to executive officers under our equity incentive programs are approved by the Committee. Grants are typically made at preestablished Committee meeting dates or in connection with a new hire or promotion, and irrespective of the timing of any financial announcement. Stock options have an exercise price equal to the NYSE closing market price on the date of grant.

Consideration of Previous “Say on Pay” Voting Results

Consideration of Previous “Say on Pay” Voting Results
Our shareowners vote annually, on an advisory basis, to approve the compensation of our NEOs as set out in the Compensation Discussion and Analysis section and in the compensation tables and accompanying narrative disclosure in the Proxy Statement.Proxy Statement. See “Proposal 2 – Advisory Vote to Approve Named Executive Officer Compensation.” In the most recent advisory vote to approve named executive officerNEO compensation, taken at the 20212023 Annual Meeting of Shareowners, over 90%nearly 92% of votes cast approved our NEO compensation as described in our 2021 Proxy Statement. compensation.
The Committee carefully considered the results of this vote as well as many other factors in determining the structure and operation of our executive compensation programs. In addition, we regularly engage with our stakeholders, including on executive compensation matters. We use the results of these engagements to inform board and Committee discussions on our corporate governanceexecutive compensation policies and pay practices.

programs.
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Notice of Annual Meeting of Shareowners and 2024 Proxy Statement

2023 Summary Compensation Table

The following table sets forth the compensation of our NEOs. As previously disclosed, as
Name and
Principal Position
Year
Salary
($)(1)
Bonus
($)(2)
Stock
Awards
($)(3)
Option
Awards
($)(4)
Non-Equity
Incentive Plan
Compensation
($)(5)
Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)(6)
All Other
Compensation
($)(7)
Total
($)
Carol Tomé
Chief Executive Officer
20231,509,71318,916,1921,358,7621,509,71395,67123,390,051
20221,466,25015,046,9681,228,5471,035,932187,50418,965,201
20211,336,25123,670,4261,125,0231,397,13992,05427,620,893
Brian Newman
Chief Financial Officer
2023831,6265,551,095406,692481,69270,9657,342,070
2022784,3775,563,543382,755364,36394,2037,189,241
2021760,76410,934,230373,4013,128,79356,69015,253,878
Nando Cesarone President U.S. and UPS Airline2023840,2544,686,065407,924487,83799,1616,521,241
2022768,0424,348,893351,117364,278107,8125,940,142
2021683,3617,218,244313,487475,91498,0898,789,095
Kate Gutmann
President International, Healthcare and Supply Chain Solutions
2023840,2544,686,065407,924487,8373,786,483152,95810,361,521
2022781,1974,674,444377,426364,27820,6766,218,021
2021745,8036,659,398390,681511,57948,54719,6908,375,698
Bala Subramanian Chief Digital and Technology Officer2023766,622500,0004,139,164373,540444,56676,3706,300,262
2022330,853250,0006,928,3929327,510,177
(1)Represents the salary earned during the portion of the year that the executive was employed.
(2)See “Employment and Severance Arrangements; Change in Control Payments” in the Compensation Discussion and Analysis for a resultdescription of circumstances arising fromcash transition payments made in connection with Bala Subramanian’s hiring.
(3)Represents the COVID-19 pandemic, 2020aggregate grant date fair value for stock awards computed in accordance with FASB ASC Topic 718. These awards include LTIP programRPUs, MIP RPUs, and the awards were granted with two separatedescribed above under “Employment Transition Awards, Retention Arrangements and Recognition Awards.” Information about the assumptions used to value these awards can be found in Note 13 “Stock-Based Compensation” in our 2023 Annual Report on Form 10-K. The amounts reported for these awards may not represent the amounts that the individuals will actually receive. The amounts received, if any, ultimately will depend on Company performance periods. and the change in our stock price over time. An overview of the features of these awards can be found in the “Compensation Discussion and Analysis.”
In accordance with generally accepted accounting principles (“GAAP”),SEC rules, we also are required to presentdisclose the grant date fair value for awards with performance conditions assuming maximum performance. The grant date fair value for the 2023 LTIP RPU awards, assuming maximum performance, is as follows: Tomé — $37,057,333; Newman — $10,608,930; Cesarone — $8,706,275; Gutmann — $8,706,275; and Subramanian - $7,972,319.
(4)Represents the aggregate grant date fair value for option awards granted in the “Stock Awards” columnapplicable year, computed in accordance with FASB ASC Topic 718. The assumptions used to value these awards can be found in Note 13 “Stock-Based Compensation” in our 2023 Annual Report on Form 10-K. The amounts reported for these awards may not represent the amounts that the individuals will actually receive. The amounts received, if any, ultimately will depend on the change in our stock price over time. An overview of the 2021 Summary Compensation Table: (i) 100%features of these awards can be found in the “Compensation Discussion and Analysis” section.
(5)Represents the cash portion of the targetMIP award. Beginning with the 2023 MIP award, the entire MIP award is payable in cash. Also, for Brian Newman in 2021, represents the cash portion of the performance-based cash award granted under his employment offer letter.
(6)Represents an estimate of the annual increase in the actuarial present value of the 2021 LTIP program awards;NEO’s accrued benefit under our retirement plans for the applicable year, assuming retirement at age 60 (or current age, if later). The actuarial present value of Kate Gutmann’s accrued benefit under our retirement plans increased by $3,786,483 between the measurement date used for 2022 and (ii) 80%the measurement date used for 2023. See “Executive Compensation — 2023 Pension Benefits” for additional information, including assumptions used in this calculation. The change in pension value can be impacted by a number of factors, including additional credited service, changes in amounts of compensation covered by the benefit formula, plan amendments and assumption changes.
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(7)All other compensation consisted of the target valuefollowing:
Name
401(k) Plan
Retirement
Contributions(a)
($)
Restoration
Savings Plan
Contributions(b)
($)
401(k)
Plan
Match
($)
Life
Insurance
Premiums
($)
Financial
Planning
Services
($)
Healthcare
Benefits
($)
Total
($)
Carol Tomé16,50024,6279,90022,24615,0007,39895,671
Brian Newman16,50018,1349,9004,03315,0007,39870,965
Nando Cesarone26,40038,3189,9002,18114,9647,39899,161
Kate Gutmann26,40099,5559,9004,0785,6277,398152,958
Bala Subramanian16,50034,9309,9001,9785,6647,39876,370
(a)Includes retirement contributions based on years of service, as described on page 41.
(b)Benefits payable under the 2020 LTIP program awards.

Consequently, we believeUPS 401(k) Savings Plan are subject to the maximum compensation limits and the annual benefit limits for a tax-qualified defined contribution plan as established by the Internal Revenue Service. Amounts exceeding these limits are paid pursuant to the UPS Restoration Savings Plan. For Kate Gutmann, also includes a transition contribution into the UPS Restoration Savings Plan, as described on page 41. For all NEOs other than Kate Gutmann and Bala Subramanian, amounts reflect actual Company contributions after giving effect to reductions offsetting excess contributions made by the Company in the 2021 Summary Compensation Table are not indicative of the compensation awarded to our NEOs in 2021,prior years as follows: Tomé — $69,750; Newman — $21,996; and overstate the value awarded. Therefore, following the 2021 Summary Compensation Table, we present a Supplemental 2021 Compensation Table including only the target value of the 2021 LTIP awards.

Name and
Principal Position
   Year   Salary
($)(1)
   Bonus
($)
   Stock
Awards
($)(2)
   Option
Awards
($)(3)
   Non-Equity
Incentive Plan
Compensation
($)(4)
   Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)(5)
   All Other
Compensation
($)(6)
   Total
($)
Carol Tomé 2021 1,336,251  23,670,426 1,125,023 1,397,139  92,054 27,620,893
Chief Executive Officer 2020 729,169  1,833,812 1,125,010   84,919 3,772,910
Brian Newman 2021 760,764  10,934,230 373,401 3,128,793  56,690 15,253,878
Chief Financial Officer 2020 741,321 600,000 991,596 362,505 2,555,238  96,784 5,347,444
  2019 212,898  5,500,084    27,139 5,740,121
Scott Price 2021 680,220  7,990,464 327,828 460,152  79,143 9,537,807
President, 2020 650,859 2,000,000 834,682 318,280 373,346  74,901 4,252,068
UPS International 2019 631,905 2,000,000 3,979,882 309,001 128,015  85,103 7,133,906
Nando Cesarone President, 2021 683,361  7,218,244 313,487 475,914  98,089 8,789,095
U.S. Operations 2020 606,495  3,699,097 163,548 357,008  60,728 4,886,876
Kate Gutmann 2021 745,803  6,659,398 390,681 511,579 48,547 19,690 8,375,698
Chief Sales and Solutions Officer 2020 688,896  3,664,545 179,714 409,344 354,807 19,322 5,316,628
Cesarone — $17,810.
(1)Represents the salary earned during the portion of the year that the executive was employed.
(2)46Represents the aggregate grant date fair value for stock awards computed in accordance with FASB ASC Topic 718. These awards include LTIP RPUs, MIP RPUs, and the special grants of RSUs made to Kate Gutmann. As described above, the grant date fair value of LTIP RPU awards for 2021 includes 100% of the target value of the award granted in 2021 and 80% of the target value of the award granted in 2020. The grant date fair value of the 2020 LTIP RPU awards reported for 2020 included only 20% of the target award value. Awards with performance conditions are valued based on the probable outcome of the performance condition as of the grant date for the award. Information about the assumptions used to value these awards can be found in Note 14 “Stock-Based Compensation” in our 2021 Annual Report on Form 10-K. The amounts reported for these awards may not represent the amounts that the individuals will actually receive. The amounts received, if any, ultimately will depend on Company performance and the change in our stock price over time. An overview of the features of these awards can be found in the “Compensation Discussion and Analysis.”
In accordance with SEC rules, we also are required to disclose the grant date fair value for awards with performance conditions assuming maximum performance. The grant date fair value for the 2021 LTIP RPU awards, plus the portion of the grant date fair value of the 2020 LTIP RPU awards reported for 2021, assuming maximum performance, is as follows: Tomé — $48,626,464; Newman — $22,184,210; Price — $15,936,071; Cesarone — $14,308,983; and Gutmann — $12,464,544.
(3)Represents the aggregate grant date fair value for option awards granted in the applicable year, computed in accordance with FASB ASC Topic 718. The assumptions used to value these awards can be found in Note 14 “Stock-Based Compensation” in our 2021 Annual Report on Form 10-K. The amounts reported for these awards may not represent the amounts that the individuals will actually receive. The amounts received, if any, ultimately will depend on the change in our stock price over time. An overview of the features of these awards can be found in the “Compensation Discussion and Analysis” section.
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Table of Contents

Executive Compensation

(4)Represents the cash portion of the MIP performance incentive award and the MIP ownership incentive award. For a description of the MIP, see “Compensation Discussion and Analysis.” The MIP ownership incentive award was paid at 100% of target (one month’s salary) for each eligible NEO who met or exceeded his or her target ownership level in the same proportion that the MIP award is paid. Also, for Brian Newman, represents the portion of the performance-based cash award granted under his employment offer letter.
(5)Represents an estimate of the annual increase in the actuarial present value of the NEOs’ accrued benefit under our retirement plans for the applicable year, assuming retirement at age 60 (or current age, if later). See “Executive Compensation — 2021 Pension Benefits” for additional information, including assumptions used in this calculation. The change in pension value can be impacted by a number of factors, including additional credited service, changes in amounts of compensation covered by the benefit formula, plan amendments and assumption changes.
(6)All other compensation consisted of the following:
Name    401(k) Plan
Retirement
Contributions(1)
($)
    Restoration
Savings Plan
Contributions(2)
($)
    401(k)
Plan
Match
($)
    Life
Insurance
Premiums
($)
    Financial
Planning
Services
($)
    Healthcare
Benefits
($)
    Total
($)
Carol Tomé 14,250 32,737 14,125 10,187 15,000 5,755 92,054
Brian Newman 14,250 11,023 8,700 1,962 15,000 5,755 56,690
Scott Price 14,250 37,192 8,700 4,991 8,255 5,755 79,143
Nando Cesarone 22,800 43,167 10,125 1,748 14,494 5,755 98,089
Kate Gutmann   7,250 1,920 4,765 5,755 19,690
(1)For newly eligible plan participants hired after July 1, 2016, we generally provide a retirement contribution based on years of service.
(2)For eligible plan participants hired after July 1, 2016, benefits payable under the UPS 401(k) Savings Plan are subject to the maximum compensation limits and the annual benefit limits for a tax-qualified defined contribution plan as established by the Internal Revenue Service. Amounts exceeding these limits are paid pursuant to the UPS Restoration Savings Plan.

Supplemental 2021 Compensation Table

The table below includes the target value of the 2021 LTIP awards in the “Stock Awards” column but excludes the 80% of the target value of the 2020 LTIP award required to be included in the 2021 Summary Compensation Table in accordance with GAAP. We believe this table is more representative of our NEOs’ 2021 compensation than the 2021 Summary Compensation Table. For ease of reference, we have highlighted the columns that differ from the 2021 amounts in the 2021 Summary Compensation Table. This table should not be viewed as a substitute for the required 2021 Summary Compensation Table.

Name    Salary
($)
    Bonus
($)
    Stock
Awards
($)
    Stock
 Option
Awards
($)
    Non-Equity
Incentive Plan

Compensation
($)
    Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)
    All Other
Compensation
 ($)
    Total
($)
Carol Tomé 1,336,251  11,257,953 1,125,023 1,397,139  92,054 15,208,420
Brian Newman 760,764  5,039,975 373,401 3,128,793  56,690 9,359,623
Scott Price 680,220  3,756,311 327,828 460,152  79,143 5,303,654
Nando Cesarone 683,361  3,591,959 313,487 475,914  98,089 5,162,810
Kate Gutmann 745,803  3,560,102 390,681 511,579 48,547 19,690 5,276,402
   45

Table of Contents

20212023 Grants of Plan-Based Awards

The following table provides information about plan-based awards granted during 20212023 to each of the NEOs. As discussed above,
 
Grant
 Date
Committee Approval Date
Estimated Possible Payouts
Under Non-Equity Incentive
Plan Awards(1)
Estimated Future Payouts
Under Equity Incentive
Plan Awards(2)
All Other
Stock
Awards:
Number
of Shares
of Stock
or Units
(#)(3)
All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#)(4)
Exercise
or Base
Price of
Option
Awards
($/Sh)
Grant
Date
Fair Value
of Stock
and
Option
Awards
($)(5)
Name
Threshold
($)
Target
($)
Maximum
($)
Threshold
(#)
Target
 (#)
Maximum
(#)
Carol Tomé3,019,42510,000,000
3/22/202384,217185,27716,844,242
3/22/202333,076185.541,358,762
2/9/202311,1182,071,950
Brian Newman963,38410,000,000
3/22/202324,11053,0424,822,241
3/22/20239,900185.54406,692
2/9/20233,911728,854
Nando Cesarone975,67410,000,000
3/22/202319,78643,5293,957,398
3/22/20239,930185.54407,924
2/9/20233,910728,668
Kate Gutmann975,67410,000,000
3/22/202319,78643,5293,957,398
3/22/20239,930185.54407,924
2/9/20233,910728,668
Bala Subramanian889,13310,000,000
3/22/202318,11839,8603,623,781
3/22/20239,093185.54373,540
2/9/20232,766515,383
(1)Reflects, as applicable, the target and maximum values of the 2023 MIP award for each NEO. The potential payments for the MIP award are performance-based and therefore at risk.
(2)Potential number of RPUs that could be earned under the 2023 LTIP if the target or maximum performance goals are attained.
(3)For NEOs other than Bala Subramanian, represents the number of RPUs or shares of class A stock granted in accordance with GAAP, amounts2023 pursuant to the 2022 MIP.
(4)Represents stock options granted under the Stock Option program in 2023.
(5)Grant date fair value under FASB ASC Topic 718 of the “Estimated Future Payouts Under Equity Incentive Plan Awards” columnLTIP RPUs, MIP RPUs, and stock options, as applicable, granted to each of the NEOs in 2023. Fair values are calculated using the NYSE closing price of UPS stock on the date of grant for RPUs and RSUs, and the “Grant Date Fair Value of Stock and Options Awards” column below reflect the full 2021 LTIP targetBlack-Scholes option pricing model for stock options. The grant date fair value and a portion of the 2020units granted under the 2023 LTIP, target value granted towhich have performance conditions, are computed based on the NEOs. The performance targets for this portionprobable outcome of the 2020 LTIP were approved in 2021 and were not reported in 2021 Grants of Plan-Based Awards table.

                All Other All Other   Grant 
                 Stock Option   Date 
                Awards:  Awards: Exercise  Fair Value 
  Estimated Possible Payouts Estimated Future Payouts Number  Number of  or Base  of Stock 
  Under Non-Equity Incentive  Under Equity Incentive  of Shares  Securities  Price of and 
  Plan Awards(1) Plan Awards(2)   of Stock  Underlying  Option Option 
  Grant Threshold Target Maximum Threshold Target Maximum or Units Options Awards Awards 
Name  Date ($) ($) ($) (#)  (#) (#) (#)(3)(#)(4)($/Sh)($)(5)
Carol Tomé   910,000 1,666,667        
  6/1/2020     74,034 162,874    12,412,473 
  3/25/2021     58,194 128,027    9,690,465 
  2/10/2021        47,619 165.66 1,125,023 
  2/10/2021       9,462   1,567,488 
Brian Newman   331,687 1,666,667        
  5/13/2020     35,156 77,343    5,894,255 
  3/25/2021     25,159 55,350    4,189,477 
  2/10/2021        15,805 165.66 373,401 
  2/10/2021       5,134   850,498 
Scott Price(6)   298,314 1,666,667        
  5/13/2020     25,254 55,560    4,234,153 
  3/25/2021     18,073 39,761    3,009,516 
  2/10/2021         13,876 165.66 327,827 
  2/10/2021       4,508   746,795 
Nando Cesarone   304,273 1,666,667        
  5/13/2020     21,629 47,583    3,626,285 
  3/25/2021     17,282 38,020    2,877,799 
  2/10/2021        13,269 165.66 313,487 
  2/10/2021       4,311   714,160 
Kate Gutmann   327,075 1,666,667        
  5/13/2020     18,486 40,668    3,099,296 
  3/25/2021     15,412 33,906    2,566,406 
  2/10/2021        9,129 165.66 215,677 
  3/25/2021        6,657 163.25 175,004 
  2/10/2021       4,942   818,692 
  3/25/2021       1,072   175,004 
performance conditions. There can be no assurance that any value will ever be realized.
(1)Reflects, as applicable, the target and maximum values of the cash portion of the 2021 MIP performance incentive award for each NEO. A participant’s first MIP performance incentive award is paid entirely in vested class A stock. The potential payments for the MIP performance incentive award are performance-based and therefore at risk. The MIP is described in “Compensation Discussion and Analysis.”
(2)
UPS logo.jpg
Potential number of RPUs that could be earned under the 2021 LTIP if the target or maximum performance goals are attained.
(3)Represents the number of RPUs or shares of class A stock granted in 2021 pursuant to the 2020 MIP. For Kate Gutmann, also represents a special grant of RSUs on March 25, 2021, which vest as follows: 25 percent on March 25, 2022; 25 percent on March 25, 2023; and 50 percent on March 25, 2024, provided she remains an employee through the applicable vesting dates.
(4)Number of stock options granted under the Stock Option program in 2021. For Kate Gutmann, also represents a special grant of stock options on March 25, 2021, which vests 20% per year over five years beginning on March 25, 2022, provided she remains an employee through the applicable vesting dates.
(5)Grant date fair value under FASB ASC Topic 718 of the LTIP RPUs, MIP RPUs, stock options and the special RSU award to Kate Gutmann, as applicable, granted to each of the NEOs in 2021. Fair values are calculated using the NYSE closing price of UPS stock on the date of grant for RPUs and RSUs, and the Black-Scholes option pricing model for stock options. The grant date fair value of the units granted under the 2021 LTIP, which have performance conditions, are computed based on the probable outcome of the performance conditions for the 2021 LTIP performance period. Also includes the grant date fair value of the units based on the probable outcome of the performance conditions under the 2020 LTIP for the 2021-2022 performance period. There can be no assurance that any value will ever be realized.
(6)As discussed above, pursuant to the Price Separation Agreement, upon Scott’s retirement from the Company on March 31, 2022, his 2021 LTIP RPU award will remain eligible to vest on a pro-rata basis, subject to actual performance for the full performance period, and his outstanding stock options (to the extent vested) will remain exercisable for 90 days following the separation date.47
46      Notice of Annual Meeting of Shareowners and 2022 Proxy Statement


Table of Contents

Executive Compensation

2021

2023 Outstanding Equity Awards at Fiscal Year-End

The following table shows the number of shares covered by exercisable options, unexercisable options, and unvested RSUs and RPUs held by the NEOs on December 31, 2021.

  Option Awards Stock Awards
Name   Number of
Securities
Underlying

Unexercised
Options
Exercisable
(#)
   Number of
Securities
Underlying
Unexercised

Options
Unexercisable
(#)(1)
   Option
Exercise
Price
($)
   Option
Grant
Date
   Option
Expiration
Date
   Number of
Shares or
Units of
Stock That
Have

Not Vested
(#)(2)
   Market
Value of
Shares or
Units of
Stock That
Have
Not Vested

($)(3)
   Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights
That
Have Not
Vested
(#)(4)
   Equity
 Incentive
 Plan
 Awards:
 Market or
 Payout
 Value of
 Unearned
 Shares,
 Units or
 Other
 Rights That
 Have Not
Vested
($)(3)
Carol Tomé 20,252 81,009 99.28 6/1/2020 6/1/2030        
   47,619 165.66 2/10/2021 2/10/2031        
            25,244 5,410,855 154,795 33,178,760
Brian Newman 6,077 24,309 105.54 2/12/2020 2/12/2030        
   15,805 165.66 2/10/2021 2/10/2031        
            5,244 1,124,068 71,496 15,324,453
Scott Price(5) 11,811 7,875 106.43 3/1/2018 3/1/2028        
  7,541 11,312 111.80 2/14/2019 2/14/2029        
  5,335 21,344 105.54 2/12/2020 2/12/2030        
   13,876 165.66 2/10/2021 2/10/2031        
            11,681 2,503,647 51,359 11,008,288
Nando Cesarone 573  98.77 3/2/2016 3/2/2026        
  735 735 106.87 3/1/2017 3/1/2027        
  757 1,513 106.43 3/1/2018 3/1/2028        
  632 1,266 104.45 3/22/2018 3/22/2028        
  1,691 5,075 111.80 2/14/2019 2/14/2029        
  2,741 10,968 105.54 2/12/2020 2/12/2030        
   13,269 165.66 2/10/2021 2/10/2031        
            30,289 6,492,117 45,817 9,820,416
Kate Gutmann 2,726  96.98 3/4/2014 3/4/2024        
  6,974  101.93 3/2/2015 3/2/2025        
  7,603  98.77 3/2/2016 3/2/2026        
  8,158 2,040 106.87 3/1/2017 3/1/2027        
  6,049 4,034 106.43 3/1/2018 3/1/2028        
  3,881 5,823 111.80 2/14/2019 2/14/2029        
  3,012 12,052 105.54 2/12/2020 2/12/2030        
   9,129 165.66 2/10/2021 2/10/2031        
   6,657 163.25 3/25/2021 3/25/2031        
            34,523 7,399,723 39,809 8,532,661
2023.
 Option AwardsStock Awards
Name
Number of
Securities
Underlying
Unexercised
Options
Exercisable
(#)
Number of
Securities
Underlying
Unexercised
Options
Unexercisable
(#)(1)
Option
Exercise
Price
($)
Option
Grant
Date
Option
Expiration
Date
Number of
Shares or
Units of
Stock That
Have
Not Vested
(#)(2)
Market
Value of
Shares or
Units of
Stock That
Have
Not Vested
($)(3)
Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights
That
Have Not
Vested
(#)(4)
Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights That
Have Not
Vested
($)(3)
Carol Tomé60,75640,50599.286/1/20206/1/2030 
 19,04728,572165.662/10/20212/10/2031 
5,07120,286214.583/23/20223/23/2032
 33,076185.543/22/20233/22/2033 
143,34822,538,606
Brian Newman18,23112,155105.542/12/20202/12/2030 
 6,3229,483165.662/10/20212/10/2031 
1,5806,320214.583/23/20223/23/2032
 9,900185.543/22/20233/22/2033 
45,7427,192,015
Nando Cesarone757106.433/1/20183/1/2028 
 633104.453/22/20183/22/2028 
 1,6911,692111.802/14/20192/14/2029 
 2,7425,484105.542/12/20202/12/2030 
 2,6547,962165.662/10/20212/10/2031 
 1,4495,798214.583/23/20223/23/2032 
 9,930185.543/22/20233/22/2033 
  36,0735,671,758
Kate Gutmann10,083106.433/1/20183/1/2028 
 7,7631,941111.802/14/20192/14/2029 
 9,0386,026105.542/12/20202/12/2030 
 3,6515,478165.662/10/20212/10/2031 
 2,6623,995163.253/25/20213/25/2031 
1,5586,232214.583/23/20223/23/2032
9,930185.543/22/20233/22/2033
  58591,99037,2485,856,503
Bala Subramanian9,093185.543/22/20233/22/2033
8,7941,382,64036,3115,709,179
(1)Stock options generally vest over a five-year period with 20% of the option vesting at each anniversary date of the grant. All options expire ten years from the date of grant. Under the terms of our equity incentive plans, unvested stock options become fully vested on the retirement date for the NEOs if they meet certain service requirements.
(2)Unvested stock awards in this column include: (a) the initial grant of RSUs made to Bala Subramanian in connection with his hiring, which vests 50% on each of July 18, 2023 and 2024; and (b) the 2021 special grant of RSUs to Kate Gutmann which generally vest as follows: 25% on March 25, 2022; 25% on March 25, 2023; and 50% on March 25, 2024. Values are rounded to the closest unit.
(3)Market value based on NYSE closing price of the class B common stock on the last trading day of the year of $157.23.
(4)Represents the potential units to be earned under the 2022 and 2023 LTIP awards, and any DEUs allocated since the grants were made, at target performance level. For the 2023 LTIP award, which has a performance period ending December 31, 2025, the maximum number of RPUs that could be earned is as follows: Tomé — 190,841; Newman — 54,635; Cesarone — 44,836; Gutmann — 44,836; and Subramanian - 41,056. For the 2022 LTIP award, which has a performance period ending December 31, 2024, the maximum number of RPUs that could be earned is as follows: Tomé — 124,524; Newman — 45,998; Cesarone — 34,525; Gutmann — 37,110; and Subramanian - 38,828.
(1)
48Stock options vest over a five-year period with 20%
UPS logo.jpg
Notice of the option vesting at each anniversary dateAnnual Meeting of the grant. All options expire ten years from the date of grant. Under the terms of our equity incentive plans, unvested stock options become fully vested on the retirement date for the NEOs if they meet certain service requirements.Shareowners and 2024 Proxy Statement
   47


Table of Contents

(2)Unvested stock awards in this column include RPUs granted as part of the MIP in 2017 and 2018 that vest over a five-year period with approximately 20% of the award vesting on January 15 of each year. The RPUs granted as part of the MIP in 2021 vest one year after the grant date. Also includes the special grants of RSUs to Nando Cesarone and Kate Gutmann on May 13, 2020, which vest as follows: 25% on May 13, 2021, 25% on May 13, 2022 and 50% on May 13,
2023 provided they remain an employee of UPS through the applicable vesting date; and the special grant of RSUs to Kate Gutmann on March 25, 2021 which vest as follows: 25% on March 25, 2022; 25% on March 25, 2023; and 50% on March 25, 2024, provided she remains an employee through the applicable vesting dates. Values are rounded to the closest unit.
(3)Market value based on NYSE closing price of the class B common stock on December 31, 2021 of $214.34.
(4)Represents the potential units to be earned under the 2020 and 2021 LTIP awards, and any dividend equivalent units allocated since the grants were made, at target performance level. For the 2021 LTIP RPU award, which has a performance period ending December 31, 2023, the maximum number of RPUs that could be earned is as follows: Tomé —129,963; Newman — 56,188; Price — 40,363; Cesarone — 38,597; and Gutmann — 34,419. For the 2020 LTIP RPU award, which has a performance period ending December 31, 2022, the maximum number of RPUs that could be earned is as follows: Tomé —210,586; Newman —101,103; Price — 72,626; Cesarone — 62,201; and Gutmann — 53,161.
(5)As discussed above, pursuant to the Price Separation Agreement, Scott’s equity awards are treated as follows in connection with his retirement on March 31, 2022: (a) RPUs granted in 2022 with respect to the 2021 MIP will vest in full immediately following March 31, 2022; (b) each RPU award granted under the LTIP will remain eligible to vest on a pro-rata basis, subject to actual performance for the full applicable performance period; and (c) his outstanding stock options (to the extent vested) will remain exercisable for 90 days following March 31, 2022.

2021 Option Exercises and Stock Vested

The following table sets forth the subject number of shares and corresponding value realized during 20212023 regarding options that were exercised, and restricted stock units and restricted performance units that vested, for each NEO.

  Option Awards Stock Awards
Name     Number of
Shares

Acquired
on Exercise
(#)
     Value
Realized
on Exercise

($)
     Number of
Shares
Acquired

on Vesting
(#)(1)
     Value
Realized
on Vesting

($)(2)
Carol Tomé    
Brian Newman    
Scott Price   37,490 7,523,733
Nando Cesarone   28,028 5,849,533
Kate Gutmann   32,042 6,622,286
(1)Consists of: the 2020 MIP RPUs that vested on February 12, 2021; the 2019 LTIP RPUs that vested on December 31, 2021; approximately 20% of the 2017 and 2018 MIP RPUs that vested on January 15, 2021; and the portion of the RSUs awarded in prior years to Scott Price, Nando Cesarone and Kate Gutmann that vested in 2021. Vested RPUs and RSUs are distributed to participants in an equivalent number of shares of class A common stock.
(2)Based on the NYSE closing price of the class B common stock on the applicable vesting date.
48      Notice of Annual Meeting of Shareowners and 2022 Proxy Statement

 Option Awards Stock Awards
Name
Number of
Shares
Acquired
on Exercise
(#)
Value
Realized
on Exercise
($)
Number of
Shares
Acquired
on Vesting
(#)(1)
Value
Realized
on Vesting
($)(2)
Carol Tomé 74,91012,130,696
Brian Newman 31,6065,100,301
Nando Cesarone9,211606,910 40,7726,733,113
Kate Gutmann 39,3856,532,216
Bala Subramanian14,3722,495,307
(1)Consists of: the 2021 LTIP RPUs that vested on December 31, 2023; and the portion of special RSUs awarded in prior years to Nando Cesarone, Kate Gutmann and Bala Subramanian that vested in 2023. Vested RPUs and RSUs are distributed to participants in an equivalent number of shares of class A common stock.
(2)Based on the NYSE closing price of the class B common stock on the applicable vesting date.

Table of Contents

Executive Compensation

2021

2023 Pension Benefits

The following table quantifies the pension benefits expected to be paid to each NEO from the UPS Retirement Plan and the UPS Excess Coordinating Benefit Plan as of December 31, 2021.2023. The terms of each are described below.

Name Plan Name Number of
Years
Credited
Service
(#)(2)
 Present
Value of
Accumulated

Benefit
($)(3)
 Payments
During
Last
Fiscal

Year
($)
Carol Tomé(1) UPS Retirement Plan    
  UPS Excess Coordinating Benefit Plan    
  Total    
Brian Newman(1) UPS Retirement Plan    
  UPS Excess Coordinating Benefit Plan    
  Total    
Scott Price(1) UPS Retirement Plan    
  UPS Excess Coordinating Benefit Plan    
  Total    
Nando Cesarone(1) UPS Retirement Plan    
  UPS Excess Coordinating Benefit Plan    
  Total    
Kate Gutmann UPS Retirement Plan 32.0  1,802,363 
  UPS Excess Coordinating Benefit Plan    
  Total   1,802,363 
NamePlan Name
Number of
Years
Credited
Service
(#)(2)
Present
Value of
Accumulated
Benefit
($)(3)
Payments
During
Last
Fiscal
Year
($)
Carol Tomé(1)
UPS Retirement Plan
 UPS Excess Coordinating Benefit Plan
 Total

Brian Newman(1)
UPS Retirement Plan
 UPS Excess Coordinating Benefit Plan
 Total

Nando Cesarone(1)
UPS Retirement Plan
 UPS Excess Coordinating Benefit Plan
 Total

Kate GutmannUPS Retirement Plan33.01,415,730
 UPS Excess Coordinating Benefit Plan33.03,636,640
 Total

5,052,370
Bala Subramanian(1)
UPS Retirement Plan
UPS Excess Coordinating Benefit Plan
Total

(1)Not eligible to participate in the UPS Retirement Plan or the UPS Excess Coordinating Benefit Plan.
(2)Represents years of service as of December 31, 2023 for all plans.
(3)Represents the total discounted value of the monthly lifetime benefit earned at December 31, 2023, assuming the individual continues in service and retires at age 60 or at the executive’s actual age, if later. The present value is not the monthly or annual lifetime benefit that would be paid to the individual. The present values are based on discount rates of 5.33% and 5.79% for the UPS Retirement Plan and UPS Excess Coordinating Benefit Plan, respectively, at December 31, 2023. The present values assume no pre-retirement mortality and utilize the Pri-2012 healthy mortality table with adjusted mortality improvement after 2012 (no collar for the UPS Retirement Plan and white collar for the UPS Excess Coordinating Benefit Plan), with mortality improvements after 2012 using the MP-2021 projection scale adjusted to converge to 0.5% in 2028 on the SOA Retirement Plan’s Experience Committee model.
(1)Not eligible to participate in the UPS Retirement Plan or the UPS Excess Coordinating Benefit Plan.
(2)
UPS logo.jpg
Represents years of service as of December 31, 2021 for all plans.49


(3)Represents the total discounted value of the monthly lifetime benefit earned at December 31, 2021, assuming the individual continues in service and retires at age 60 or at the executive’s actual age, if later. The present value is not the monthly or annual lifetime benefit that would be paid to the individual. The present values are based on discount rates of 3.05% and 3.38% for the UPS Retirement Plan and UPS Excess Coordinating Benefit Plan, respectively, at December 31, 2021. The present values assume no pre-retirement mortality and utilize the Pri-2012 healthy mortality table with adjusted mortality improvement after 2012 (no collar for the UPS Retirement Plan and white collar for the UPS Excess Coordinating Benefit Plan), with mortality improvements after 2012 using the MP-2021 projection scale adjusted to converge to 0.5% in 2026 on the SOA Retirement Plan’s Experience Committee (RPEC) model.Pension Benefits

Pension Benefits

The UPS Retirement Plan is non-contributory and includes substantially all eligible employees of participating domestic subsidiaries who are not members of a collective bargaining unit, as well as certain employees covered by a collective bargaining agreement. The UPS Retirement Plan was closed to new entrants as of July 1, 2016.

UPS also sponsors a non-qualified defined benefit plan, the UPS Excess Coordinating Benefit Plan, for non-union employees whose pay and benefits in the qualified plan are limited by the Internal Revenue Service. An employee must be at least age 55 with 10 years of service to be eligible to participate in this plan. In the year that an individual first becomes eligible to participate in the UPS Excess Coordinating Benefit Plan, there is an increase for the participant for that year equal to the full present value of the participant’s accrued benefit in the plan. In accordance with the terms of the Excess Coordinating Benefit Plan, following a participant’s retirement, the Company pays an amount equal to the Social Security and Medicare taxes due on the present value of the benefits provided under the plan.

The UPS Retirement Plan and UPS Excess Coordinating Benefit Plan provide monthly lifetime benefits to participants and their eligible beneficiaries based on final average compensation at retirement, years of service with UPS and age at retirement. Participants may choose to receive a reduced benefit payable in an optionalthe form of an annuity that is equivalent to the single lifetime benefit.

The plans provide monthly benefits based on the results from up to four benefit formulas. Participants receive the largest benefit from among the applicable benefit formulas. For Kate Gutmann the formula that results in the largest benefit is called the “grandfathered integrated formula.” This formula provides retirement income equal to 58.33% of final average.

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Table of Contents

average compensation, offset by a portion of the Social Security benefit. A participant with less than 35 years of benefit service receives a proportionately lesser amount

amount.

Participants earn benefit service for the time they work as an eligible UPS employee. For purposes of the formulas, compensation includes salary and an eligible portion of the MIP award. The average final compensation for each participant in the plans is the average covered compensation of the participant during the five highest consecutive years out of the last ten full calendar years of service.

Benefits payable under the UPS Retirement Plan are subject to the maximum compensation limits and the annual benefit limits for a tax-qualified defined benefit plan as prescribed and adjusted from time to time by the Internal Revenue Service. Eligible amounts exceeding these limits will be paid from the UPS Excess Coordinating Benefit Plan. Under this plan, participants receive the benefit in the form of a life annuity.

The plans permit participants with 25 or more years of benefit service to retire as early as age 55 with only a limited reduction in the amount of their monthly benefits. NEOs eligible to retire at age 60 receive unreduced benefits from the plans. In addition, the plans allow participants with ten years or more of service to retire at age 55 with a larger reduction in the amount of their benefit.

2021 These plans froze accruals after December 31, 2022.

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Notice of Annual Meeting of Shareowners and 2024 Proxy Statement


2023 Non-Qualified Deferred Compensation

The following table shows the executive and Company contributions or credits, earnings and account balances for the NEOs in the UPS Deferred Compensation Plan and UPS Restoration Savings Plan for 2021.

Name Plan Name Executive
Contributions

in Last FY
($)(1)
 Registrant
Contributions
in Last FY
($)(2)
 Aggregate
Earnings
in Last FY
($)(3)
 Aggregate
Withdrawals/
Distributions
($)
 Aggregate
Balance at
Last FYE ($)(4)
Carol Tomé UPS Deferred Compensation Plan 467,688  398,667  4,439,559
  UPS Restoration Savings Plan  32,738 2,984  35,721
Brian Newman    UPS Restoration Savings Plan          11,024     1,096          12,120
Scott Price UPS Restoration Savings Plan  37,193 18,568  111,805
Nando Cesarone UPS Restoration Savings Plan  43,167 6,019  49,187
Kate Gutmann UPS Deferred Compensation Plan   124,059  561,890
(1)Amounts are also disclosed in the “Salary” column of the 2021 Summary Compensation Table.
(2)Company credits to the UPS Restoration Savings Plan, which amounts are also disclosed in the “All Other Compensation” column of the 2021 Summary Compensation Table.
(3)No amounts in this column are reported in the 2021 Summary Compensation Table.
(4)Certain amounts in this column represent salary, bonus or stock options contributed by the NEO to the plans in prior years as follows: Tomé — $1,883,750; Newman – $0; Price — $0 Cesarone — $0; and Gutmann — $118,149.

2023.

NamePlan Name
Executive
Contributions
in Last FY
($)(1)
Registrant
Contributions
in Last FY
($)(2)
Aggregate
Earnings
in Last FY
($)(3)
Aggregate
Withdrawals/
Distributions
($)
Aggregate
Balance at
Last FYE
($)(4)
Carol ToméUPS Deferred Compensation Plan1,538,596773,7897,917,934
 UPS Restoration Savings Plan47,2187,536198,914
Outstanding Non-employee Director RSU Awards(272,536)4,256,299
Brian NewmanUPS Restoration Savings Plan25,1205,39285,288
Nando CesaroneUPS Restoration Savings Plan42,06910,598142,140
Kate GutmannUPS Deferred Compensation Plan(13,872)453,977
Bala SubramanianUPS Restoration Savings Plan7,3007218,021
(1)Amounts are also included in the “Salary” column of the 2023 Summary Compensation Table.
(2)Company credits to the UPS Restoration Savings Plan, which amounts are also disclosed in the “All Other Compensation” column of the 2023 Summary Compensation Table.
(3)No amounts in this column are reported in the 2023 Summary Compensation Table.
(4)Certain amounts in this column represent salary, bonus or stock options contributed by the NEO to the plans in prior years as follows: Tomé — $4,228,931; Newman – $0; Cesarone — $0; Gutmann — $118,149; and Subramanian - $0.
The deferred compensation vehicles in the UPS Deferred Compensation Plan and the UPS Restoration Savings Plan are described below. Not all of the NEOs participate in each feature of the UPS Deferred Compensation Plan.

Salary Deferral Feature
Prior to December 31, 2004, contributions could be deferred from executive officers’ monthly salary and from their half-month bonus. Also prior to December 31, 2004, non-employee directors could defer retainer and meeting fees quarterly. Assets from the discontinued UPS Retirement Plan for Outside Directors were transferred to the 2004 and Before Salary Deferral Feature

in 2003. No contributions were permitted after December 31, 2004, except as described below. After December 31, 2004, executive officers may defer 1% to 35% of their monthly salary and 1% to 100% of the cash portion of the MIP award. They may also defer excess pre-tax contributions if the UPS 401(k) Savings Plan fails the annual average deferral percentage test. Non-employee directors may defer retainer fees quarterly. Elections are made annually for the following calendar year.
Prior to December 31, 2004, contributions could be deferred from executive officers’ monthly salary and from their half-month bonus.
Prior to December 31, 2004, non-employee directors could defer retainer and meeting fees quarterly. Assets from the discontinued UPS Retirement Plan for Outside Directors were transferred to the 2004 and Before SalaryStock Option Deferral Feature in 2003.
No contributions were permitted after December 31, 2004, except as described below.
After December 31, 2004, executive officers may defer 1% to 35% of their monthly salary and 1% to 100% of the cash portion of the MIP award. They may also defer excess pre-tax contributions if the UPS 401(k) Savings Plan fails the annual average deferral percentage test.
Non-employee directors may defer retainer fees quarterly.
Elections are made annually for the following calendar year.
50      Notice of Annual Meeting of Shareowners and 2022 Proxy Statement

TableAssets are invested solely in shares of Contents

Executive Compensation

Stock Option Deferral Feature

Assets are invested solely in shares of UPS stock.
Non-qualified or incentive stock options which vested prior to December 31, 2004 were deferrable during the annual enrollment period for the following calendar year.  Participants deferred receipt of UPS stock that would otherwise be taxable upon the exercise of the stock option.
The shares received upon exercise of these options are deferred into a rabbi trust. The shares held in this trust are classified as treasury stock, and the liability to participating employees is classified as “deferred compensation obligations” in the shareowners’ equity section of the balance sheet.
No deferrals of stock options were permitted after December 31, 2004.
UPS stock. Non-qualified or incentive stock options which vested prior to December 31, 2004 were deferrable during the annual enrollment period for the following calendar year. Participants deferred receipt of UPS stock that would otherwise be taxable upon the exercise of the stock option. The shares received upon exercise of these options are deferred into a rabbi trust. The shares held in this trust are classified as treasury stock, and the liability to participating employees is classified as “deferred compensation obligations” in the shareowners’ equity section of the balance sheet. No deferrals of stock options were permitted after December 31, 2004. As a result of the requirements applicable to non-qualified deferred compensation arrangements under Section 409A of the Internal Revenue Code and related guidance, deferral of stock options is no longer offered under the UPS Deferred Compensation Plan for options that vested after December 31, 2004.
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Withdrawals and Distributions under the UPS Deferred Compensation Plan for options that vested after December 31, 2004.

Withdrawals

For the 2004 and DistributionsBefore Salary Deferral Feature, participants may elect to receive the funds in a lump sum or up to a 10-year installment (of 120 monthly payments), subject to restrictions if the balance is less than $20,000. For the 2005 and Beyond Salary Deferral Feature, participants may elect to receive funds in a lump sum or up to a 10 year installment (120 monthly payments), subject to restrictions if the balance, plus the total balance in any other account which must be aggregated with the 2005 and Beyond Salary Deferral Account under Section 409A of the Internal Revenue Code, is less than the Internal Revenue Code Section 402(g) annual limit in effect for qualified 401(k) plans on the date the participant becomes eligible for a distribution.
For the Stock Option Deferral Feature, participants may elect to receive shares in a lump sum or up to 10 annual installments, subject to restrictions if the balance is less than $20,000. The distribution of shares will occur pro-rata based on the type of stock options (non-qualified or incentive) that were originally deferred.
The distribution election under the 2005 and Beyond Salary Deferral Feature may be changed one time only, but may be changed more frequently under the 2004 and Before Salary Deferral Feature and the Stock Option Deferral Feature. Hardship distributions are permitted under all three features of the UPS Deferred Compensation Plan

For the 2004 and Before Salary Deferral Feature, participants may elect to receive the funds in a lump sum or up to a 10-year installment (of 120 monthly payments), subject to restrictions if the balance is less than $20,000.
For the 2005 and Beyond Salary Deferral Feature, participants may elect to receive funds in a lump sum or up to a 10 year installment (120 monthly payments), subject to restrictions if the balance, plus the total balance in any other account which must be aggregated with the 2005 and Beyond Salary Deferral Account under Section 409A of the Internal Revenue Code, is less than the Internal Revenue Code Section 402(g) annual limit in effect for qualified 401(k) plans on the date the participant becomes eligible for a distribution.
For the Stock Option Deferral Feature, participants may elect to receive shares in a lump sum or up to 10 annual installments, subject to restrictions if the balance is less than $20,000. The distribution of shares will occur pro-rata based on the type of stock options (non-qualified or incentive) that were originally deferred.
The distribution election under the 2005 and Beyond Salary Deferral Feature may be changed one time only, but may be changed more frequently under the 2004 and Before Salary Deferral Feature and the Stock Option Deferral Feature.
Hardship distributions are permitted under all three features of the UPS Deferred Compensation Plan.
Withdrawals are not permitted under the 2005 and Beyond Salary Deferral Feature, but withdrawals are permitted for 100% of the account under the 2004 and Before Salary Deferral Feature and Stock Option Deferral Feature. However, withdrawals will result in a forfeiture of 10% of the participant’s total account balances.

Plan. Withdrawals are not permitted under the 2005 and Beyond Salary Deferral Feature, but withdrawals are permitted for 100% of the account under the 2004 and Before Salary Deferral Feature and Stock Option Deferral Feature. However, withdrawals will result in a forfeiture of 10% of the participant’s total account balances.

No Company contributions are made to any of the three features of the UPS Deferred Compensation Plan. The aggregate balances shown in the table above represent amounts that the NEOs have earned but elected to defer, plus earnings (or less losses). There are no above-market or preferential earnings in the UPS Deferred Compensation Plan. The investment options mirror those in the UPS 401(k) Savings Plan. Dividends earned on shares of UPS stock in the UPS Deferred Compensation Plan are earned at the same rate as all other class A and class B shares of common stock. Dividends are added to the participant’s deferred compensation balance. Deferral elections made under the UPS Deferred Compensation Plan are irrevocable once made.

UPS Restoration Savings Plan

UPS Restoration Savings Plan
Benefits payable under the UPS 401(k) Savings Plan are subject to the maximum compensation limits and the annual benefit limits for a tax-qualified defined contribution plan as established by the Internal Revenue Service. Amounts exceeding these limits are paid pursuant to the UPS Restoration Savings Plan, which is a non-qualified restoration plan designed to replace the benefits limited under the tax-qualified plan. Without the UPS Restoration Savings Plan, executive officers would receive a lower benefit as a percent of eligible compensation than the benefit received by other participants in the UPS Savings Plan.

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Notice of Annual Meeting of Shareowners and 2024 Proxy Statement

Potential Payments on Termination or Change in Control

UPS has created a culture where long tenure for executives is the norm. As a result, executive

Executive officers serve without employment contracts, as do most of our other U.S.-based non-union employees.

In connection with each of Carol Tomé’s, Brian Newman’s and Bala Subramanian’s hiring, we entered into a protective covenant agreementagreements with herthem which protectsprotect UPS’s confidential information and includesinclude non-competition and non-solicitation covenants in favor of UPS. If sheFor Brian and Carol, if either of their employment is terminated without “cause” prior, then the Company is obligated to June 1, 2022, then she is entitled to continued payment of herpay their base salary for up to 24 months. If her employment is terminated without “cause” after June 1, 2022, then the Company is obligated to make such payments onlymonths if it elects to enforce the post-termination covenants.

In connection with

The UPS Key Employee Severance Plan (the “Severance Plan”) provides for severance compensation and benefits upon certain terminations of employment of key employees, including the hiring of each of Brian Newman and Scott Price, we entered into similarNEOs. The severance protections under the Severance Plan replace cash severance benefits (if any) to which a participating employee would have otherwise been entitled under their protective covenant agreements with each(as described above).
The Severance Plan in general provides that if the Company terminates the employment of them. At December 31, 2021, these agreements also provideda participant other than due to “Cause,” “Disability Termination,” or death (a “Qualifying Termination”), the Company will pay: (i) an amount in cash equal to a pro-rata portion of the individual’s annual performance incentive award under the MIP that would have been earned for the paymentyear of termination, based on actual performance for the full performance period, with the pro-rata portion calculated based on the number of months during which the individual was employed by the Company during the applicable year; (ii) an amount in cash equal to one times (or, for the CEO, two years’times) the sum of the participant’s annual base salary if they are terminated without cause,plus the participant’s target MIP performance award in effect as of the termination date; (iii) an amount in cash equal to the portion of the participant’s monthly Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”) premium for the participant and the Company electsparticipant’s dependents to enforce the post-termination covenants. Subsequentextent it exceeds the premiums paid by the participant for such coverage immediately prior to December 31, 2021, we entered into a new agreement with Scott, described below.

We have also entered into retention arrangementstermination times the number of months in the participant’s applicable COBRA period; and similar protective covenant agreements with Nando Cesarone and Kate Gutmann that provide(iv) career counseling services up to $20,000 (or, for the continued vestingCEO up to $30,000).

In addition, with respect to options held by retirement eligible employees, and RPUs granted under the MIP or LTIP, in each case granted on or after the effective date of their 2020 special RSU retention grantsthe Severance Plan, a participant who experiences a Qualifying Termination will generally be entitled to the same treatment that would apply in the event theyof “retirement” under the terms of such awards. With respect to stock options granted to a participant on or after the effective date of the Severance Plan, such stock options (to the extent the participant is not retirement eligible and that are terminated without causevested as of the date of the Qualifying Termination) will remain exercisable until the earlier of the first anniversary of the termination date and the original expiration date of the stock options.
For terminations of employment not governed by retention arrangements or resign for “good reason”.

Ourawards made prior to the effective date of the Severance Plan, our equity incentive plans and related documents contain provisions that affect outstanding awards to all plan participants, including the NEOs, in the event of a participant’s death, disability, or retirement, or a change in control (as defined below) of the Company.

Upon a participant’s death, disability or retirement:

Options will immediately vest, and remain exercisable until the tenth anniversary of the date of grant;
Shares of restricted stock, RSUs or RPUs that are no longer subject to performance conditions will immediately vest. In the case of a participant’s death, shares (or cash, as applicable) attributable to the number of restricted shares, RSUs or RPUs will be transferred to the participant’s estate within 90 days. In the case of a participant’s disability or retirement, shares (or cash, as applicable) attributable to the number of restricted shares, RSUs or RPUs will be transferred to the participant on the same schedule as if they had remained employed; and
Shares of restricted stock, RSUs and RPUs that are still subject to performance conditions shall be deemed earned on a prorated basis for the number of months worked during the performance period. In the case of a participant’s death, shares (or cash, as applicable) attributable to the prorated number of restricted shares, RSUs or RPUs calculated at target performance level will be transferred to the participant’s estate within 90 days. In the case of a participant’s disability or retirement, shares (or cash, as applicable) attributable to the prorated number of restricted shares, RSUs or RPUs calculated based on actual performance results for the full performance period will be transferred to the participant following the end of the performance period.

Options will immediately vest, and remain exercisable until the tenth anniversary of the date of grant;
Shares of restricted stock, RSUs or RPUs that are no longer subject to performance conditions will immediately vest. In the case of a participant’s death, shares (or cash, as applicable) attributable to the number of restricted shares, RSUs or RPUs will be transferred to the participant’s estate within 90 days. In the case of a participant’s disability or retirement, shares (or cash, as applicable) attributable to the number of restricted shares, RSUs or RPUs will be transferred to the participant on the same schedule as if they had remained employed; and
Shares of restricted stock, RSUs and RPUs that are still subject to performance conditions shall be deemed earned on a prorated basis for the number of months worked during the performance period. In the case of a participant’s death, shares (or cash, as applicable) attributable to the prorated number of restricted shares, RSUs or RPUs calculated at target performance level will be transferred to the participant’s estate within 90 days. In the case of a participant’s disability or retirement, shares (or cash, as applicable) attributable to the prorated number of restricted shares, RSUs or RPUs calculated based on actual performance results for the full performance period will be transferred to the participant following the end of the performance period.
Upon a change in control, if the successor company does not continue, assume or substitute other grants for outstanding awards, or upon a change in control followed by a termination of the grantee’s employment by UPS without cause or by the grantee for good reason:

Options will immediately vest and become exercisable;
Shares of restricted stock, RSUs or RPUs that are no longer subject to performance conditions will immediately vest; and
Shares of restricted stock, RSUs and RPUs that are still subject to performance conditions will be deemed earned to the extent that actual achievement of the applicable performance conditions can be determined, or on a prorated basis for the portion of the performance period completed prior to the change in control or qualifying termination, based on target or actual performance.
Options will immediately vest and become exercisable;
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Shares of restricted stock, RSUs or RPUs that are no longer subject to performance conditions will immediately vest; and
Shares of restricted stock, RSUs and RPUs that are still subject to performance conditions will be deemed earned to the extent that actual achievement of the applicable performance conditions can be determined, or on a prorated basis for the portion of the performance period completed prior to the change in control or qualifying termination, based on target or actual performance.Other Outstanding Awards; No Tax Gross-Ups

Other Outstanding Awards; No Tax Gross-Ups

Any other awards which may be outstanding would vest and be paid generally as described above (except, where applicable, timing of payment generally will be tied to such change in control, rather than termination or resignation). We do not provide for the payment of tax gross-ups on outstanding awards.

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Table of Contents

Executive Compensation

The following table shows the potential payments to the NEOs upon a termination of employment under various circumstances. In preparing the table, we assumedcircumstances, assuming the event occurred on December 31, 2021.29, 2023. The closing price per share of our class B common stock on the NYSE on December 31, 2021the last trading day of 2023 was $214.34.$157.23. The actual amounts to be paid under any of the scenarios can only be determined at the time of such NEO’s separation from the Company.

In accordance with applicable SEC requirements, we disclose in this table

Name
Separation
Pay(1)
($)
Accelerated/Continued
Vesting of Equity
Awards(2)
($)
Benefits(3)
Total
($)
Carol Tomé   
Termination (voluntary or involuntary for cause)
Termination (involuntary without cause)9,077,5934,546,35813,623,951
Change in Control (with qualifying termination)9,058,27612,826,64421,884,920
Retirement12,826,64412,826,644
Death12,826,64412,826,644
Disability12,826,64412,826,644
Brian Newman   
Termination (voluntary or involuntary for cause)
Termination (involuntary without cause)1,830,4711,301,5503,132,021
Change in Control (with qualifying termination)1,801,1104,121,4185,922,528
Retirement
Death4,121,4184,121,418
Disability4,121,4184,121,418
Nando Cesarone   
Termination (voluntary or involuntary for cause)
Termination (involuntary without cause)1,851,5561,068,1162,919,672
Change in Control (with qualifying termination)1,824,0863,073,3924,897,478
Retirement
Death3,073,3923,073,392
Disability3,073,3923,073,392
Kate Gutmann   
Termination (voluntary or involuntary for cause)
Termination (involuntary without cause)1,852,8571,160,1063,012,963
Change in Control (with qualifying termination)1,824,0863,327,8745,151,960
Retirement3,327,874840,7484,168,622
Death3,327,8743,327,874
Disability3,327,8743,327,874
Bala Subramanian
Termination (voluntary or involuntary for cause)
Termination (involuntary without cause)1,691,9244,210,6845,902,608
Change in Control (with qualifying termination)1,662,2924,210,6845,872,976
Retirement
Death4,210,6844,210,684
Disability4,210,6844,210,684
(1)Represents the potential payments and benefits that Scott Price would have received in connection with the indicated events if they had occurred on December 31, 2021. However, we also disclose below the table the actual payments and benefits to which Scott is or will be entitled under the Price Separation Agreement.

Name Separation
Pay(1)
($)
     Accelerated
Vesting of Equity
Awards(2)
($)
     Total
($)
Carol Tomé      
Termination (voluntary or involuntary for cause)   
Termination (involuntary without cause) 2,730,000  2,730,000
Change in Control (with qualifying termination)  50,228,603 50,228,603
Retirement  50,228,603 50,228,603
Death  50,228,603 50,228,603
Disability  50,228,603 50,228,603
Brian Newman      
Termination (voluntary or involuntary for cause)   
Termination (involuntary without cause) 3,030,864  3,030,864
Change in Control (with qualifying termination)  19,862,728 19,862,728
Retirement  19,862,728 19,862,728
Death 1,500,000 19,862,728 21,362,728
Disability 1,500,000 19,862,728 21,362,728
Scott Price      
Termination (voluntary or involuntary for cause)   
Termination (involuntary without cause) 1,376,832 1,516,639 2,893,471
Change in Control (with qualifying termination)  18,519,370 18,519,370
Retirement  17,002,731 17,002,731
Death  18,519,370 18,519,370
Disability  17,002,731 17,002,731
Nando Cesarone      
Termination (voluntary or involuntary for cause)   
Termination (involuntary without cause)  5,548,241 5,548,241
Change in Control (with qualifying termination)  19,053,555 19,053,555
Retirement  13,505,315 13,505,315
Death  19,053,555 19,053,555
Disability  13,505,315 13,505,315
Kate Gutmann      
Termination (voluntary or involuntary for cause)   
Termination (involuntary without cause)  5,781,494 5,781,494
Change in Control (with qualifying termination)  19,279,786 19,279,786
Retirement  13,498,292 13,498,292
Death  19,279,786 19,279,786
Disability  13,498,292 13,498,292
(1)For Brian Newman, includes payment of his performance-based cash award (see “Employment Transition Awards, Retention Arrangements and Recognition Awards” above). The final portion of this award was paid in March 2022. For Brian Newman and Scott Price, separation pay consisting of 24 month’s base salary, would only be payable if the Company elects to enforce the post-termination non-compete covenants.
(2)UPS Key Employee Severance Plan. For Carol Tomé, represents two times her annual base salary and two times her target MIP award (200% of base salary). For the other NEOs, represents one times their annual base salary and a sum equaling their target MIP awards (115% of base salary).
(2)Represents the value of accelerated vesting of stock options and RPUs in accordance with the terms of our equity incentive plans and the applicable award certificates. Also includes the 2020 and 2021 LTIP awards calculated at target. The performance measurement period for the 2020 LTIP award ends December 31, 2022, and performance measurement period for the 2021 LTIP award ends December 31, 2023. With respect to Scott Price, Nando Cesarone, and Kate Gutmann, includes the continued vesting of the one-time RSU awards to each as described in “Employment Transition Awards, Retention Arrangements and Recognition Awards” above.
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Table of Contents

Separation Arrangement with Scott Price

The Company has entered into the Price Separation Agreement, pursuant to which Scott Price is retiring from the Company on March 31, 2022, and under which the Company will provide certain severance compensation and benefits to Scott in lieu of any benefits under Scott’s protective covenant agreement. The Price Separation Agreement provides that Scott will receive, in addition to certain accrued compensation and benefits, a lump sum cash severance payment equal to $912,151.20, representing (A) one-year of base salary and (B) a pro-rata portion of Scott’s target award under the 2022 MIP. In addition, Scott’s equity awards outstanding as of the separation date will be treated as follows:

(1)4,089 RPUs granted to Scott in 2022 with respect to the 2021 MIP will vest in full immediately following the retirement date;
(2)each RPU award granted under the LTIP will remain eligible to vest on a pro-rata basis, subject to actual performance for the full applicable performance period. Such pro-rata target opportunities consist of 24,759 RPUs with respect to the 2020 LTIP award, and 7,645 RPUs with respect to the 2021 LTIP award ; and
(3)Scott’s outstanding stock options (to the extent vested) will remain exercisable for 90 days following the separation date.

The estimated aggregate value of the accelerated or continued vesting of stock options and RPUs in accordance with the terms of our equity incentive plans and the applicable award certificates. Also includes the 2022 and 2023 LTIP awards described above is approximately $7,502,231 based oncalculated at target. The performance measurement period for the closing price2022 LTIP award ends December 31, 2024, and the performance measurement period for the 2023 LTIP award ends December 31, 2025. With respect to Nando Cesarone and Kate Gutmann, includes the continued vesting of the class B common stock on March 1, 2022one-time RSU awards to each as described in “Employment Transition Awards, Retention Arrangements and assumes thatRecognition Awards” above.

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Notice of Annual Meeting of Shareowners and 2024 Proxy Statement


(3)Represents the LTIP RPU awards will be earned at the target level.

The Price Separation Agreement includes certain customary protective covenants in favoractuarial present value of the Company, including confidentiality, employeeincremental non-qualified amounts payable upon change in control, early retirement, death and customer non-solicitation, non-competition,disability from the UPS Excess Coordinating Benefit Plan. For information about the UPS Excess Coordinating Benefit Plan, see the Pension Benefits table and non-disparagement provisions.

Other Amounts

related narrative. The same assumptions were used to calculate the present value of the amounts in the table that were used for the Pension Benefits table except that benefits are assumed to be payable immediately as of December 31, 2023 (or age 55 if later) instead of age 60. Only individuals eligible for early retirement (age 55 with 10 years of service) who are not yet age 60 will have an early retirement value in the table.

Other Amounts
The previous table does not include payments and benefits to the extent they are generally provided on a non-discriminatory basis to salaried employees not subject to a collective bargaining agreement upon termination of employment. These include: 

Life insurance upon death in the amount of 12 times the employee’s monthly base salary, with a December 31, 2021 maximum benefit payable of $1 million;
A death benefit in the amount of three times the employee’s monthly salary;
Disability benefits; and
Accrued vacation amounts.

Life insurance upon death in the amount of 12 times the employee’s monthly base salary, with a December 29, 2023 maximum benefit payable of $1 million;
A death benefit in the amount of three times the employee’s monthly salary;
Disability benefits; and
Accrued vacation amounts.
The tables also do not include amounts to which the executives would be entitled to receive that are already described in the compensation tables that appear earlier in this Proxy Statement, including:

The value of equity awards that are already vested;
Amounts payable under defined benefit pension plans (except as described above with respect to Kate Gutmann); and
Amounts previously deferred into the deferred compensation plan.
The value
Definition of equity awards that are already vested;
Amounts payable under defined benefit pension plans; and
Amounts previously deferred into the deferred compensation plan.a Change in Control

Definition of a Change in Control

A change in control as defined in our equity incentive compensation plans is generally deemed to have occurred as of the first day that any one or more of the following conditions shall have been satisfied:

The consummation of a reorganization, merger, share exchange or consolidation, in each case, where persons who were shareowners of UPS immediately prior to such reorganization, merger, share exchange or consolidation do not, immediately thereafter, own more than fifty percent (50%) of the combined voting power of the reorganized, merged, surviving or consolidated company’s then outstanding securities entitled to vote generally in the election of directors in substantially the same proportions as immediately prior to the transaction; or a liquidation or dissolution of UPS or the sale of substantially all of UPS’s assets; or
Individuals who, as of any date (the “Beginning Date”), constitute the Board of Directors (the “Incumbent Board”) and who, as of the end of the two-year period beginning on such Beginning Date, cease for any reason to constitute at least a majority of the Board of Directors, provided that any person becoming a director subsequent to the Beginning Date whose election, or nomination for election by UPS’s shareowners, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board (other than an election or nomination of an individual whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of the directors of UPS, as such terms are used under applicable SEC rules and requirements) shall be considered as though such person were a member of the Incumbent Board.
The consummation of a reorganization, merger, share exchange or consolidation, in each case, where persons who were shareowners of UPS immediately prior to such reorganization, merger, share exchange or consolidation do not, immediately thereafter, own more than fifty percent (50%) of the combined voting power of the reorganized, merged, surviving or consolidated company’s then outstanding securities entitled to vote generally in the election of directors in substantially the same proportions as immediately prior to the transaction; or a liquidation or dissolution of UPS or the sale of substantially all of UPS’s assets; or
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Individuals who, as of any date (the “Beginning Date”), constitute the Board of Directors (the “Incumbent Board”) and who, as of the end of the two-year period beginning on such Beginning Date, cease for any reason to constitute at least a majority of the Board of Directors, provided that any person becoming a director subsequent to the Beginning Date whose election, or nomination for election by UPS’s shareowners, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board (other than an election or nomination of an individual whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of the directors of UPS, as such terms are used under applicable SEC rules and requirements) shall be considered as though such person were a member of the Incumbent Board.55
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Table of Contents

Executive Compensation

Equity Compensation Plans

The following table sets forth information as of December 31, 20212023 concerning shares of our common stock authorized for issuance under our equity compensation plans.

Plan category Number of Securities
to be Issued
Upon Exercise of
Outstanding Options,
Warrants and Rights
(a)
 Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights
(b)
 Number of Securities
Remaining Available for Future
Issuance
Under Equity Compensation
Plans (Excluding Securities
Reflected in Column (a))
(c)
 
Equity compensation plans approved by security holders(1) 10,644,164 17.01 29,926,374(2) 
Equity compensation plans not approved by security holders  N/A  
Total 10,644,164 17.01 29,926,374 
Plan category
Number of Securities
to be Issued
Upon Exercise of
Outstanding Options,
Warrants and Rights
(a)
Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights
($)(b)
Number of Securities
Remaining Available for Future
Issuance
Under Equity Compensation
Plans (Excluding Securities
Reflected in Column (a))
(c)
Equity compensation plans approved by security holders(1)
6,433,685127.91
19,816,746(2)
Equity compensation plans not approved by security holdersN/A
Total6,433,685127.9119,816,746
(1)Includes all equity incentive compensation plans and the Discounted Employee Stock Purchase Plan, each of which has been approved by our shareowners. Effective with the approval of the 2021 Omnibus Incentive Compensation Plan (the “2021 Plan”) in May 2021, no additional securities may be issued under prior equity incentive compensation plans. Awards that do not entitle the holder to receive or purchase shares and awards that are settled in cash are not counted against the aggregate number of shares available for awards under the 2021 Plan. Awards that are subject to performance conditions are reported at the maximum performance level, which may overstate the dilution associated with such awards.
(2)In addition to grants of options, warrants or rights, this number includes up to 10,034,871 shares of common stock or other stock-based awards that may be issued under the 2021 Plan, and up to 9,781,875 shares of common stock that may be issued under the Discounted Employee Stock Purchase Plan. This number does not include shares under prior equity incentive compensation plans because no new awards may be made under those plans.
(1)Includes all equity incentive compensation plans and the Discounted Employee Stock Purchase Plan, each of which has been approved by our shareowners. Effective with the approval of the 2021 Omnibus Incentive Compensation Plan in May 2021, no additional securities may be issued under prior equity incentive compensation plans. Awards that do not entitle the holder to receive or purchase shares and awards that are settled in cash are not counted against the aggregate number of shares available for awards under the 2021 Plan.
(2)56In addition to grants
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Notice of options, warrants or rights, this number includes up to 18,855,155 sharesAnnual Meeting of common stock or other stock-based awards that may be issued under the 2021 Plan,Shareowners and up to 11,071,219 shares of common stock that may be issued under the Discounted Employee Stock Purchase Plan. This number does not include shares under prior equity incentive compensation plans because no new awards may be made under those plans.2024 Proxy Statement



Median Employee to CEO Pay Ratio

As required by Item 402(u) of Regulation S-K, pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, we are providing the following ratio of the annual total compensation of our CEO to the annual total compensation of our median employee.

The 2021

For purposes of this disclosure, the 2023 annual total compensation of the median compensated employee was $50,379;$53,669; our CEO’s 2021 annual total compensation as required to be determined by GAAP and included in the 2021 Summary Compensation Table was $27,632,142.  As required by GAAP, the CEO’s 2021 annual total compensation included in the 2021 Summary Compensation Table includes both 100% of the target value of the 2021 LTIP award and 80% of the target value of the 2020 LTIP award. We believe a more representative CEO annual total compensation should exclude the 80% of the target value of the 2020 LTIP award, in which case our CEO’s 20212023 annual total compensation was $15,219,669,$23,402,885, and the ratio of CEO compensation to that of the median compensated employee would be 302-to-one.  Including all of the CEO’s annual total compensation as required by GAAP results in a ratio of CEO compensation to that of the median compensation employee of 548-to-one.

these amounts was 436-to-one.

Our CEO’s 20212023 annual total compensation was different from the amount included in the 20212023 Summary Compensation Table total“Total” column. Amounts related to healthcare benefits, which are available generally to all salaried employees of the Company, are included in the annual total compensation amounts above. The CEO’s and median employee’s Company-paid healthcare benefit amounts were $11,249$12,834 and $5,449$6,178 respectively. For the CEO, this amount is not included in the 2021 Summary Compensation Table or the Supplemental 20212023 Summary Compensation Table, as permitted by SEC regulations.

The SEC’s rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. As a result, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies have different employee populations and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios.

The pay ratio reported above is a reasonable estimate calculated in a manner consistent with SEC rules based on our payroll and employment records and the methodology described below. As permitted by SEC rules, for our 2021 pay ratio reported above, we used the same median employee that we used for our 2020 pay ratio, as we believe there has been no change in our employee population or employee compensation arrangements that would significantly impact our pay ratio disclosure. For these purposes, we identified the median compensated employee from our employee population as of October 1, 2020,2023, using total taxable wages (Form W-2 Box 1 or equivalent) paid to our employees in fiscal year 2020.2023. We determined our total workforce as of October 1, 20202023 to consist of 547,857485,504 employees. During the fiscal year 2023, UPS acquired Happy Returns and MNX Global Logistics. These entities employed 326 and 791 employees, respectively. As permitted by SEC rules, under the 5% “De Minimis Exemption,” we excluded 26,36822,994 non-U.S. employees, or 4.8%4.7% of our total workforce. As a result of these exclusions, our median compensated employee was identified from an employee population of 521,489462,510 employees.

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Table of Contents

The excluded countries and their employee populations were as follows: Argentina (242(202 employees), Australia (486(500 employees), Austria (185(214 employees), Bahrain (28  employees), Belarus (23(30 employees), Belgium (1,008(1,157 employees), Brazil (692(1,502 employees), Chile (113  employees), Colombia (1,064(357 employees), Costa Rica (343(379 employees), Czech Republic (453Czechia (566 employees), Denmark (531(565 employees), Dominican Republic (116(87 employees), Ecuador (65(269 employees), Egypt (29(20 employees), El Salvador (30(4 employees), Finland (187(184 employees), Greece (143(160 employees), Guam (2 employees)(1 employee), Guatemala (73(54 employees), Honduras (39(6 employees), Hong Kong (1,013(803 employees), Hungary (417(498 employees), Indonesia (159(114 employees), Ireland (1,133(883 employees), Italy (1,279(1,748 employees), Jamaica (4(3 employees), Japan (644(622 employees), Jersey (1 employee), Kazakhstan (36 employees), Kuwait (54(38 employees), Luxembourg (11(13 employees), Macau (2 employees), Malaysia (302 employees), Mexico (2,489(251 employees), Morocco (60(65 employees), New Zealand (27(43 employees), Nicaragua (25(18 employees), Nigeria (288(222 employees), Norway (105(100 employees), Pakistan (59(50 employees), Panama (32 employees), Peru (77(167 employees), Philippines (1,470(1,305 employees), Portugal (195(280 employees), Puerto Rico (442 employees), Romania (142(122 employees), Russia (571(5 employees), South Korea (522 employees), Singapore (1,219(1,055 employees), Slovakia (18(29 employees), Slovenia (51(58 employees), South Africa (277  employees), South Korea (558(260 employees), Spain (1,314(1,548 employees), Sweden (938(935 employees), Switzerland (703(759 employees), Taiwan (970(872 employees), Thailand (473(436 employees), Turkey (1,992  employees), Ukraine (89  employees), United Arab Emirates (532(1,548 employees), U.S. Virgin Islands (10 employees), Ukraine (106 employees), United Arab Emirates (442 employees), and Vietnam (336(330 employees).

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Pay Versus Performance
As required by Item 402(v) of Regulation S-K, we are providing the following table and related disclosures.
Year(1)
Summary
Comp
Table Total
for First CEO
($)
Summary
Comp
Table Total
for Second CEO
($)
Comp
Actually Paid
to First CEO
($)
Comp Actually Paid to Second CEO ($)
Average
Summary
Comp
Table Total
for Non-CEO
Named
Executive
Officers
($)
Average
Comp
Actually Paid
to Non-CEO
Named
Executive
Officers
($)
Value of Initial Fixed $100
Investment Based on:
 Net Income
(millions)
($)
Adjusted Operating Profit(3) (millions)
($)
Total
Shareholder
Return
($)
Peer Group(2)
Total Shareholder
Return
($)
2023N/A23,390,051N/A15,171,6047,631,2744,457,788152.66146.746,7089,873 
2022N/A18,965,201N/A13,072,0626,714,3955,141,166162.33131.1111,54813,853 
2021N/A27,620,893N/A43,250,36110,489,12019,573,719193.56152.8312,89013,144 
20205,842,1303,772,91037,662,11313,337,6795,454,19211,181,872147.28118.181,3438,718 
(1)In both 2023 and 2022, Carol Tomé was the CEO and the Non-CEO NEOs were Brian Newman, Nando Cesarone, Kate Gutmann and Bala Subramanian; in 2021, Carol Tomé was the CEO and the Non-CEO NEOs were Brian Newman, Scott Price, Nando Cesarone and Kate Gutmann; and in 2020 the CEOs were David Abney (First CEO) and Carol Tomé (Second CEO), and the Non-CEO NEOs were Brian Newman, Nando Cesarone, Kate Gutmann, Juan Perez and George Willis.
(2)Our peer group is represented by the Dow Jones Transportation Average.
(3)In accordance with SEC rules, we are required to include in the above table the most important financial performance measure (not otherwise required to be disclosed in the table) used to link compensation actually paid to our named executive officers for 2023 to Company performance. We consider this measure to be Adjusted Operating Profit, which is calculated by excluding the following items from Operating Profit determined in accordance with GAAP: for 2023, one-time compensation representing a payment to certain U.S.-based non-union part-time supervisors, goodwill and other asset impairment charges, and transformation and other adjustments; for 2022, a one-time non-cash expense related to stock-based awards that were accelerated to fully vest in 2022 in connection with a change in incentive compensation program design, a one-time non-cash charge reflecting a reduction in the estimated residual value of fully-depreciated MD-11 aircraft, and transformation and other adjustments; and for each of 2021 and 2020, transformation and other adjustments.
CEO SCT Total to CAP Reconciliation
Year
Summary
Compensation
Table Total for
CEO
($)
Deductions from
SCT Total(1)
($)
Additions to SCT
Total(2)
($)
Compensation
Actually Paid
($)
202323,390,05120,274,95412,056,50715,171,604
202218,965,20116,275,51510,382,37613,072,062
202127,620,89324,795,44940,424,91743,250,361
2020(3)
3,772,9102,958,82212,523,59113,337,679
5,842,1303,192,62535,012,60837,662,113
(1)Represents the grant-date fair value of stock awards granted during the year (2023: $18,916,192, 2022: $15,046,968, 2021: $23,670,426, 2020: Carol Tomé $1,833,812 and David Abney $1,411,585), the grant-date fair value of option awards granted during the year (2023: $1,358,762, 2022: $1,228,547, 2021: $1,125,023, 2020: Carol Tomé $1,125,010 and David Abney $1,153,237) and the aggregate change in the actuarial present value of accumulated benefits under pension plans (2023: $—, 2022: $—, 2021: $—, 2020: Carol Tomé $— and David Abney $627,803).
(2)Represents the service cost for defined benefit pension plans (2023: $—, 2022: $—, 2021: $—, 2020: Carol Tomé $— and David Abney $234,743) and the value of equity awards calculated using the required methodology for determining CAP, as further detailed in the table below.
(3)In 2020 the CEOs were Carol Tomé (first row) and David Abney (second row).
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Notice of Annual Meeting of Shareowners and 2024 Proxy Statement


CEO Equity Component of CAP
YearYear End Fair Value of Equity Awards Granted in the Year
($)
Change in Fair Value from Prior Year End to Year End of Outstanding Unvested Equity Awards Granted in Prior Years
($)
Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year
($)
Change in Fair Value from Prior Year End to Vesting Date of Equity Awards Granted in Prior Years that Vested in the Year
($)
Total Equity Award Adjustments
($)
202314,112,488(3,170,240)2,071,950(957,691)12,056,507
202212,805,107(5,289,424)2,866,69310,382,376
202133,072,4406,256,0431,096,43440,424,917
2020(1)
12,523,59112,523,591
9,170,26814,290,96611,316,63134,777,865
(1)In 2020 the CEOs were Carol Tomé (first row) and David Abney (second row).
Stock awards issued under the Management Incentive Plan are valued at the New York Stock Exchange (“NYSE”) closing price of UPS Class B stock at each applicable date.
Outstanding stock awards issued under the Long-Term Incentive Plan are valued using a Monte Carlo model at each reporting date with performance outcomes assumed to be at target. Long-Term Incentive Plan awards that vest during the period are valued using actual performance outcomes and the NYSE closing price of UPS Class B stock on the vesting date.
Option awards are valued using a Black-Scholes option pricing model that reflects the award’s exercise price relative to the NYSE closing price of UPS Class B common stock at each valuation date.
Stock award valuations include reinvested dividends where applicable.
Average Other NEOs SCT Total to CAP Reconciliation
Year
Summary
Compensation
Table Total for
Other NEOs
($)
Deductions from
SCT Total(1)
($)
Additions to SCT
Total(2)
($)
Compensation
Actually Paid
($)
20237,631,2746,111,2382,937,7524,457,788
20226,714,3955,656,6424,083,4135,141,166
202110,489,1208,564,07017,648,66919,573,719
20205,454,1923,897,9289,625,60811,181,872
(1)Represents the average grant date fair value of stock awards granted during the year (2023: $4,765,597, 2022: $5,378,818, 2021: $8,200,584, 2020: $3,369,684), the average grant date fair value of option awards granted during the year (2023: $399,020, 2022: $277,825, 2021: $351,349, 2020: $210,297) and the average aggregate change in the actuarial present value of accumulated benefits under pension plans (2023: $946,621, 2022: $—, 2021: $12,137, 2020: $317,948).
(2)Represents the average service cost for defined benefit pension plans (2023: $—, 2022: $44,219, 2021: $40,127, 2020: $65,084) and the value of equity awards calculated using the required methodology for determining CAP, as further detailed in the table below.
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Average Other NEOs Equity Component of CAP
YearYear End Fair Value of Equity Awards Granted in the Year
($)
Change in Fair Value from Prior Year End to Year End of Outstanding Unvested Equity Awards Granted in Prior Years
($)
Fair Value as of Vesting Date of Equity Awards Granted and Vested in the Year
($)
Change in Fair Value from Prior Year End to Vesting Date of Equity Awards Granted in Prior Years that Vested in the Year
($)
Total Equity Award Adjustments
($)
20233,467,543(884,732)546,548(191,607)2,937,752
20224,841,330(1,551,105)748,9694,039,194
202112,120,6872,762,6502,725,20517,608,542
20206,340,4811,480,751120,4141,618,8789,560,524
Stock awards issued under the Management Incentive Plan are valued at the NYSE closing price of UPS Class B stock at each applicable date.
Outstanding stock awards issued under the Long-Term Incentive Plan are valued using a Monte Carlo model at each reporting date with performance outcomes assumed to be at target. Long-Term Incentive Plan awards that vest during the period are valued using actual performance outcomes and the NYSE closing price of UPS Class B stock on the vesting date.
Option awards are valued using a Black-Scholes option pricing model that reflects the award’s exercise price relative to the NYSE closing price of UPS Class B common stock at each valuation date.
Stock award valuations include reinvested dividends where applicable.
The following table lists the financial performance measures that we believe represent the most important financial performance measures we use to link compensation actually paid to our NEOs for fiscal 2023 to our performance.
Tabular List
Adjusted operating profit
Revenue growth
Adjusted return on invested capital
Adjusted earnings per share growth
Adjusted free cash flow
3957
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3960
3962
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Proposal 2 — Advisory Vote to Approve Named Executive Officer Compensation

What am I voting on? Whether you approve, on an advisory basis, the compensation of the NEOs as disclosed in this Proxy Statement.

Board’s Recommendation: Vote FOR this proposal.

Vote Required: Approval by a majority of the voting power of the shares present in person or by proxy.

In accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and Section 14A of the Exchange Act, shareowners may vote, on an advisory basis, to approve the 20212023 compensation paid to our NEOs as disclosed in this proxy statementProxy Statement (“say on pay”). We currently conduct say on pay votes annually. We expect that the next say on pay vote will occur at our 20232025 Annual Meeting of Shareowners.

Pay for performance and alignment with the long-term interests of our shareowners are key principles of our compensation programs. NEO compensation reflects the following:

encouraging executive decision-making that is aligned with the long-term interests of our shareowners;
tying a significant portion of executive pay to Company performance over a multi-year period;
promoting UPS’s long-standing culture of owner-management; and
balancing shorter- and longer-term performance metrics to encourage the efficient management of our business and minimizing excessive risk-taking.

encouraging executive decision-making that is aligned with the long-term interests of our shareowners;
tying a significant portion of executive pay to Company performance over a multi-year period;
promoting UPS’s long-standing culture of owner-management; and
balancing shorter and longer-term performance metrics to encourage the efficient management of our business and minimizing excessive risk-taking.
Although this vote is non-binding, the Compensation and Human Capital Committee and the board value your views and will consider the voting results. If there is a significant negative vote, we expect that we will consult directly with significant shareowners to better understand their concerns. The Compensation and Human Capital Committee and the board would consider feedback obtained through this process in making future compensation decisions.

In accordance with the Dodd-Frank Act, this vote does not overrule any decisions by the board, will not create or imply any change to or any additional fiduciary duties of the board and will not restrict or limit the ability of shareowners generally to make proposals for inclusion in proxy materials related to executive compensation.

Shareowners are being asked to approve the following resolution:

“RESOLVED, that the shareowners approve, on an advisory basis, the compensation of the NEOs, as described in the Compensation Discussion and Analysis section and in the compensation tables and accompanying narrative disclosuredisclosures in the Company’s Proxy Statement for the 20222024 Annual Meeting of Shareowners.”

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Table of Contents

Ownership of Our Securities

Ownership of Our Securities

Ownership of Our Securities
Securities Ownership of Certain Beneficial Owners and Management

The following table sets forth information as to each person known to us to be the beneficial owner of more than five percent of either our class A or class B common stock, based on SEC filings by such persons. Class A shares are entitled to ten votes per share and class B shares are entitled to one vote per share on each matter acted upon at the Annual Meeting. Class A shares are held by current and former employees and are not publicly traded. As of March 1, 20222024 there were 137,653,301125,478,056 outstanding shares of class A common stock and 733,368,173727,841,749 outstanding shares of class B common stock.

Name and address Number of Shares
of Class B Stock
Beneficially Owned
       Percent of
Class B Stock
BlackRock, Inc.(1)
55 East 52nd Street
New York, NY 10055
 52,091,461 7.1%
The Vanguard Group(2)
100 Vanguard Blvd.
Malvern, PA 19355
 64,571,614 8.8%
(1)According to a Schedule 13G filed with the SEC on February 3, 2022, BlackRock, Inc. has sole voting power with respect to 45,322,087 shares and sole dispositive power with respect to 52,091,461 shares.
(2)According to a Schedule 13G/A filed with the SEC on February 10, 2022, The Vanguard Group has shared voting power with respect to 1,235,041 shares, sole dispositive power with respect to 61,493,614 shares and shared dispositive power with respect to 3,078,000 shares.

Name and address
Number of Shares
of Class B Stock
Beneficially Owned
Percent of
Class B
Stock
BlackRock, Inc.(1)
55 East 52nd Street
New York, NY 10055
54,283,5796.4%
The Vanguard Group(2)
100 Vanguard Blvd.
Malvern, PA 19355
67,218,1777.9%
(1)According to a Schedule 13G/A filed with the SEC on January 26, 2024, BlackRock, Inc. has sole voting power with respect to 49,199,159 shares and sole dispositive power with respect to all 54,283,579 shares.
(2)According to a Schedule 13G/A filed with the SEC on February 13, 2024, The Vanguard Group has shared voting power with respect to 918,229 shares, sole dispositive power with respect to 64,027,901 shares and shared dispositive power with respect to 3,190,276 shares.
The following table sets forth the beneficial ownership of our class A and class B common stock as of March 1, 2022,2024 by each of our NEOs, each of our directors, and all of our current executive officers and directors as a group. Ownership is calculated in accordance with SEC rules and regulations.

  Number of Shares
Beneficially
Owned(1)(2)
     Total Shares
Beneficially

Owned(5)
 
  Class A Shares(3)(4)     Class B Shares 
Named Executive Officers       
Carol Tomé 184,968 13,036 198,004 
Brian Newman 44,974  44,974 
Scott Price 70,204 38,305 108,509 
Nando Cesarone 39,082 1 39,083 
Kate Gutmann 147,144  147,144 
Non-Employee Directors       
Rodney Adkins 16,543  16,543 
Eva Boratto 1,677  1,677 
Michael Burns 32,907  32,907 
Wayne Hewett 1,677 873 2,550 
Angela Hwang 2,017  2,017 
Kate Johnson 1,373  1,373 
William Johnson 29,757 160 29,917 
Ann Livermore 55,663  55,663 
Franck Moison 8,664  8,664 
Christiana Smith Shi 6,804  6,804 
Russell Stokes 1,373 400 1,773 
Kevin Warsh 18,576  18,576 
Current Executive Officers and Directors as a Group (24 persons) 1 ,023,059 60,444 1,083,503(6) 
 
Number of Shares
Beneficially
Owned(1)
Total Shares
Beneficially
Owned(4)
 
Class A Shares(2)(3)
Class B Shares
Named Executive Officers   
Carol Tomé386,65313,036399,689
Brian Newman88,81825,000113,818
Nando Cesarone67,208167,209
Kate Gutmann163,381— 163,381
Bala Subramanian12,708— 12,708
Non-Employee Directors
Rodney Adkins19,844— 19,844
Eva Boratto3,904— 3,904
Michael Burns37,042— 37,042
Wayne Hewett3,9048684,772
Angela Hwang4,268— 4,268
Kate Johnson3,577— 3,577
William Johnson34,84516035,005
Franck Moison11,396— 11,396
Christiana Smith Shi9,401— 9,401
Russell Stokes3,5774003,977
Kevin Warsh22,025— 22,025
Executive Officers and Directors as a Group (20 persons)1,059,749 39,465 1,099,214 (5)
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(2)Includes class A shares that may be acquired through April 30, 2024 upon the conversion of Contents

(1)Includes shares for which the named person or group has sole voting or investment power or has shared voting or investment power with his or her spouse.
(2)Includes 1,083 shares pledged by all current executive officers as a group, which were pledged prior to the 2014 adoption of a policy prohibiting pledges of UPS stock. None of our directors have pledged any shares of UPS stock. Shares pledged are not counted for purposes of compliance with our stock ownership guidelines. All executive officers that have pledged shares comply with our stock ownership guidelines after excluding the shares subject to pledge.
(3)Includes class A shares that may be acquired through April 30, 2022 upon the conversion of RSUs following separation from the UPS Board of Directors, including 25,244 RSUs held by Carol Tomé in connection with her service as a non-employee director.
(4)Includes class A shares that may be acquired through stock options exercisable through April 30, 2022 as follows: Tomé – 148,880; Newman – 15,315; Price – 36,568; Cesarone – 7,087; Gutmann – 49,239; and all current directors and executive officers as a group — 435,196.
(5)All directors and executive officers individually and as a group held less than one percent of outstanding shares of each of class A and class B common stock outstanding as of March 1, 2022. Assumes that all options exercisable through April 30, 2022 and owned by the named individual are exercised, and that shares acquirable under RSUs through April 30, 2022 are so acquired. The total number of shares outstanding used in calculating this percentage for each individual person also assumes that none of the options owned by other named individuals are exercised and that none of the shares acquirable under the RSUs held by other named individual are so acquired.
(6)Includes 271 RSUs and RPUs for all current executive officers and directors as a group that vest and convert to class A common stock prior to April 30, 2022. Our directors hold vested equity instruments that, in accordance with SEC reporting rules, are not reported in the table above because the individual does not have the right to acquire beneficial ownership of the underlying shares within 60 days of March 1, 2022. These equity interests represent additional financial interests in UPS that are subject to the same market risks as ownership of our common stock. For Carol Tomé and Ann Livermore, represents 1,295 and 2,740 phantom stock units, respectively; and for Michael Burns, Wayne Hewett and Kevin Warsh, represents deferred non-employee director retainer fees allocated to 5,302, 704 and 8,434 shares of UPS common stock, respectively, within the UPS Deferred Compensation Plan. Phantom stock units were granted to non-employee directors pursuant to a deferred compensation program previously provided to non-employee directors. Carol’s phantom stock units were awarded during her service as a non-employee director. Dividends paid on UPS common stock are credited to the director’s phantom stock unit balance. Upon termination of the individual’s service as a director, amounts represented by phantom stock units will be distributed in cash over a time period elected by the recipient.

DELINQUENT SECTIONRSUs following a separation from the Board of Directors, including 27,071 RSUs held by Carol Tomé in connection with her prior service as a non-employee director.

(3)Includes class A shares that may be acquired through stock options exercisable through April 30, 2024 as follows: Tomé – 207,313; Newman – 38,931; Cesarone – 20,449; Gutmann – 68,357; Subramanian - 1,818; and directors and executive officers as a group — 429,901.
(4)All directors and executive officers individually and as a group held less than one percent of outstanding shares of each of class A and class B common stock outstanding as of March 1, 2024. Assumes that all options exercisable through April 30, 2024 and owned by the named individual are exercised, and that shares acquirable under RSUs through April 30, 2024 are so acquired. The total number of shares outstanding used in calculating this percentage for each individual person also assumes that none of the options owned by other named individuals are exercised and that none of the shares acquirable under the RSUs held by other named individual are so acquired.
(5)Includes 585 RSUs and RPUs for executive officers and directors as a group that vest and convert to class A common stock prior to April 30, 2024. Directors hold vested equity interests that, in accordance with SEC reporting rules, are not reported in the table above because the individual does not have the right to acquire beneficial ownership of the underlying shares within 60 days of March 1, 2024. These equity interests represent additional financial interests in UPS that are subject to the same market risks as ownership of our common stock. For Carol Tomé, represents 1,389 phantom stock units; and for Michael Burns, Wayne Hewett, Franck Moison and Kevin Warsh, represents deferred non-employee director retainer fees allocated to 5,685, 1,250, 1,334 and 10,449 shares of UPS common stock, respectively, within the UPS Deferred Compensation Plan. Phantom stock units were granted to non-employee directors pursuant to a deferred compensation program previously provided to non-employee directors. Carol’s phantom stock units were awarded during her prior service as a non-employee director. Dividends paid on UPS common stock are credited to the director’s phantom stock unit balance. Upon termination of the individual’s service as a director, amounts represented by phantom stock units will be distributed in cash over a time period elected by the recipient.
Delinquent Section 16(a) REPORTS

Reports

Section 16(a) of the Securities Exchange Act of 1934 requires our directors, executive officers and persons who own beneficially more than 10% of either our class A or class B common stock to file reports of ownership and changes in ownership of such stock with the Securities and Exchange Commission. To our knowledge, for 20212023 each of our directors and executive officers complied with all applicable Section 16(a) filing requirements, except for the late filing in of one Form 4 for each of our then-executive officers, relating to report two separate transactions for Russell Stokes, which were fileda single equity grant made in March 2023, that was late due to ana Company administrative error.

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Audit Committee Matters

Audit Committee Matters

Audit Committee Matters
Proposal 3 — Ratification of Auditors

What am I voting on? Ratify the Audit Committee’s (as used in this Audit Committee Matters section, the “Committee”) appointment of Deloitte & Touche LLP (“Deloitte”) to serve as our independent registered public accounting firm for 2022.

2024.

Board’s Recommendation: Vote FOR the ratification of the appointment of Deloitte as our independent registered public accounting firm for 2022.

2024.

Vote Required: Approval by a majority of the voting power of the shares present in person or by proxy.

proxy and entitled to vote on the proposal.

Deloitte has been our independent auditor since we became a publicly traded company in 1999. Prior to 1999, Deloitte served as the independent auditor of our privately held parent company since 1969. Deloitte audited our 20212023 consolidated financial statements and our internal control over financial reporting.

The Committee appointed Deloitte as our independent registered public accounting firm for the year ending December 31, 2022.2024. The board recommends that shareholdersshareowners ratify Deloitte’s appointment. Although shareholdershareowner ratification is not required, the board believes that seeking ratification is a good corporate governance practice. If not ratified, the Committee will reconsider Deloitte’s appointment. Even if ratified, the Committee, in its discretion, may change the appointment at any time during the year if it determines that such a change would be in the best interests of UPS and its shareowners.

A Deloitte representative is expected to attend the Annual Meeting, will have the opportunity to make a statement if desired, and be available to respond to appropriate shareholdershareowner questions. Additional information about the Committee, Deloitte’s appointment and fees, and other related matters follows.

Audit Committee Report

Roles and Responsibilities. The Committee’s key responsibilities are described in its charter. The charter is reviewed annually and was most recently approved by the board in 20212023 and is available on the governance section of the UPS Investor Relations website at www.investors.ups.com. Pursuant to its charter, the Committee’s purposes, duties and responsibilities include:

assisting the board in discharging its responsibilities relating to Company’s accounting, reporting and financial practices;
overseeing the Company’s accounting and financial reporting processes, including reviewing earnings or annual report press releases, overseeing the integrity of financial statements and evaluating major financial risks;
having sole authority to appoint, oversee, determine the compensation of and terminate the Company’s independent registered public accounting firm; and
overseeing the Company’s disclosure controls and internal controls, compliance with legal and regulatory requirements, and Code of Business Conduct.

assisting the board in discharging its responsibilities relating to the Company’s accounting, reporting and financial practices;
overseeing the Company’s accounting and financial reporting processes, including reviewing earnings or annual report press releases, overseeing the integrity of financial statements and evaluating major financial risks;
having sole authority to appoint, oversee, determine the compensation of and terminate the Company’s independent registered public accounting firm; and
overseeing the Company’s disclosure controls and internal controls, compliance with legal and regulatory requirements, and Code of Business Conduct.
Management has primary responsibility for preparing the Company’s financial statements and establishing effective internal control over financial reporting. Deloitte is responsible for auditing those financial statements and the Company’s internal control over financial reporting and expressing an opinion on the conformity of the Company’s audited financial statements with generally accepted accounting principles (“GAAP”) and on the effectiveness of internal control over financial reporting based on criteria established by the Committee of Sponsoring Organizations of the Treadway Commission.

The Committee appoints the independent registered public accounting firm, approves the terms of the audit engagement, and reviews and approves Deloitte’s fees. In this context, the Committee discussed the terms of Deloitte’s 20222024 audit engagement, the audit’s overall scope and plan, and the other matters required to be
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discussed by the applicable requirements of the Public Company Accounting Oversight Board (“PCAOB”) and the SEC. The Committee asked Deloitte questions relating to such matters.

Financial Statement Oversight. The Committee met with management and Deloitte to review and discuss the Company’s audited financial statements and internal control over financial reporting. The Committee discussed with management and Deloitte the critical accounting policies applied by the Company in the preparation of its financial statements, the quality, and not just the acceptability, of the accounting principles utilized, the reasonableness of significant accounting judgments, and the clarity of disclosures in the financial statements.
The Committee also reviewed and discussed the Company’s enhanced assessment and oversight of the effects of COVID-19 on internal controls and financial reporting.

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The Committeeregularly met with Deloitte and UPS’s internal auditors, in each case with and without other members of management present, to discuss the results of their respective examinations, the evaluations of the Company’s internal control and the overall quality and integrity of the Company’s financial reporting.

Internal Audit Oversight. The Committee reviewed UPS’s internal audit plan and the performance, responsibilities, charter, budget and staffing of UPS’s internal audit function.

Compliance and Ethics Oversight. The Committee met with members of management to discuss the Company’s legal and ethical compliance programs. The Committee also oversaw compliance with procedures for the receipt, retention and treatment of complaints regarding accounting, internal accounting controls, auditing and other federal securities law matters, including confidential and anonymous submissions of these complaints.

Auditor Independence. Deloitte provided the Committee with the written disclosures and the letter required by the PCAOB regarding Deloitte’s communications with the Committee concerning independence. The Committee discussed Deloitte’s independence with the firm and considered whether Deloitte’s provision of non-audit services was compatible with their independence.

Pre-approvals. The Committee requires the pre-approval of all audit and non-audit services provided by Deloitte. The Committee reviewed and pre-approved all fees paid to Deloitte.

Committee Assessment of Deloitte. The Committee, along with management and the Company’s internal auditors, reviewed Deloitte’s 20212023 performance. The Committee considered the continued independence, objectivity and professional skepticism of Deloitte, the length of time that Deloitte has served as the Company’s independent auditors, the breadth and complexity of the business and its global footprint. The Committee also considered external data and management’s perception of Deloitte’s auditing qualification and experience, the quantity and quality of Deloitte’s staff, Deloitte’s fees, the communication and interaction with the Deloitte team over the course of the prior year, PCAOB reports on Deloitte, and the potential impact of changing independent registered public accounting firms.

The Committee determined that Deloitte can provide both the necessary expertise and has a similar global footprint to effectively audit UPS worldwide. The Committee also considered the efficiencies resulting from Deloitte’s deep understanding of our business, Deloitte’s focus on independence, their quality control policies, the quality and efficiency of the work performed, and the quality of discussions and feedback sessions. Additionally, the Committee is involved in the selection of the new partner-in-charge of the audit engagement when there is a rotation required under applicable rules.

Based on the results of its review, the Committee concluded that Deloitte is independent and that it is in the best interests of UPS and its shareowners to appoint Deloitte to serve as the Company’s independent registered accounting firm for 2022.2024. The board recommends that shareowners ratify this appointment.

Furthermore, the Committee recommended to the Board of Directors that the audited financial statements be included in UPS’s Annual Report on Form 10-K for the year ended December 31, 20212023 for filing with the SEC.

The Audit Committee

Eva Boratto, Chair
Michael Burns
Wayne Hewett
Angela Hwang

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Audit Committee Matters

Principal Accounting Firm Fees

The Committee, with the ratification of the shareowners, engaged Deloitte to perform the annual audits of the Company’s financial statements for each of the fiscal years ended December 31, 20212023 and 2020.2022. The aggregate fees billed to us for the fiscal years ended December 31, 20212023 and 20202022 by Deloitte, the member firms of Deloitte Touche Tohmatsu Limited, and their respective affiliates are below:

       2021      2020
Audit Fees(1) $20,246,000 $18,404,000
Audit-Related Fees(2) $1,491,000 $1,130,000
Total Audit and Audit-Related Fees $21,737,000 $19,534,000
Tax Fees(3) $128,000 $271,000
All Other Fees $ $
Total Fees $21,865,000 $19,805,000
listed in the table:
 20232022
Audit Fees(1)
$20,228,000 $17,969,000 
Audit-Related Fees(2)
$1,615,000 $1,977,000 
Total Audit and Audit-Related Fees$21,843,000 $19,946,000 
Tax Fees(3)
$98,000 $65,000 
All Other Fees(4)
$6,000 $80,000 
Total Fees$21,947,000 $20,091,000 
(1)Fees for professional services performed by Deloitte for the audit of our annual financial statements and review of financial statements included in our Form 10-Q filings, internal control attestation procedures, statutory audits of foreign subsidiary financial statements and other services that are normally provided in connection with statutory and regulatory filings or engagements.
(2)Fees for assurance and related services performed by Deloitte that are reasonably related to the performance of the audit or review of our financial statements. This includes employee benefit plan and compensation plan audits, independent service auditors’ reports, attestation procedures related to securities offerings, other attestations.
(3)Fees for professional services performed by Deloitte with respect to tax compliance work and tax planning and advice services. This includes review of original and amended tax returns for the Company and its consolidated subsidiaries, refund claims, and payment planning and tax audit assistance.
(4)Fees for professional services performed by Deloitte with respect to assessment of climate reporting readiness and financial systems implementation assistance, and subscription fees to the Deloitte online accounting research platform.
(1)Fees for professional services performed
Services Provided by Deloitte for the audit of our annual financial statements and review of financial statements included in our Form 10-Q filings, internal control attestation procedures, statutory audits of foreign subsidiary financial statements and other services that are normally provided in connection with statutory and regulatory filings or engagements.
(2)Fees for assurance and related services performed by Deloitte that are reasonably related to the performance of the audit or review of our financial statements. This includes employee benefit plan and compensation plan audits, independent service auditors’ reports, attestation procedures related to securities offerings, and other attestations by Deloitte.
(3)Fees for professional services performed by Deloitte with respect to tax compliance work and tax planning and advice services. This includes review of original and amended tax returns for the Company and its consolidated subsidiaries, refund claims, and payment planning and tax audit assistance.

Services Provided by Deloitte

All services provided by Deloitte are permissible under applicable laws and regulations. The Committee has established a policy requiring the pre-approval of all audit and non-audit services performed by Deloitte in order to help assure that the provision of such services does not impair Deloitte’s independence.

Proposed services may be pre-approved through the application of detailed policies and procedures (“general pre-approval”) or by specific review of each service (“specific pre-approval”). Unless a type of service to be provided by Deloitte has received general pre-approval, it requires specific pre-approval by the Committee. Any proposed services exceeding pre-approved cost levels also requiresrequire specific approval by the Committee.

The Audit, Audit-Related, Tax and All Other services that have received general pre-approval of the Committee, and those services that are prohibited, are described in the policy along with the corresponding cost levels. The term of any general pre-approval is twelve months from the date of pre-approval, unless otherwise stated. The Committee annually reviews and pre-approves the services that may be provided by Deloitte without obtaining specific pre-approval and may revise the list from time to time based on subsequent determinations.

The Committee has delegated to its Chair the authority to pre-approve certain permitted services between the Committee’s regularly scheduled meetings, and the Chair must report any pre-approval decisions to the Committee at its next scheduled meeting for review by the Committee. The policy prohibits the Committee from delegating its responsibilities to management for pre-approving Deloitte’s permitted services.

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Shareowner Proposals

Shareowner Proposals
In accordance with SEC rules, we have set forth below shareowner proposals and the shareowner proponents’ supporting statements. The board’s response to each proposal and voting recommendation are also set forth below. The board recommends a vote against each proposal because it does not believe the proposals will drive or create long-term shareowner value. Each shareowner proposal will be voted on at our Annual Meeting only if properly presented at the meeting. The Company is not responsible for any inaccuracies contained in the proposals.

Proposal 4 — Shareowner Proposal Requesting the Board Prepare an Annual Report on Lobbying Activities

What am I voting on? Whether you want to require the board to prepare an annual report on UPS lobbying activities.

Board’s Recommendation: Vote AGAINST this proposal because:

UPS already provides significant disclosures and is transparent and accountable with respect to lobbying and political activities
UPS has consistently been named a top company for political transparency and accountability
UPS protects and promotes shareowner value by participating in the political process
The board provides independent oversight of UPS’s lobbying and political activities

Vote Required: Approval by a majority of the voting power of the shares present in person or by proxy.

Shareowner Proposal

Boston Trust Walden Company, One Beacon Street, Boston, MA 02108, has advised us that they, along with co-proponents whose names, addresses and share ownership will be promptly provided upon oral or written request to the UPS Corporate Secretary, intend to submit the proposal set forth below for consideration at the Annual Meeting.

Whereas, we believe in full disclosure of UPS’s lobbying activities and expenditures to assess whether its lobbying is consistent with UPS’s expressed goals and in the best interests of shareowners.

Resolved: the shareowners of UPS request the Board prepare a report, updated annually, disclosing:

1.Company policy and procedures governing lobbying, both direct and indirect, and grassroots lobbying communications.
2.Payments by UPS used for (a) direct or indirect lobbying or (b) grassroots lobbying communications, in each case including the amount of the payment and the recipient.
3.UPS’s membership in and payments to any tax-exempt organization that writes and endorses model legislation.
4.Description of management’s and the Board’s decision-making process and oversight for making payments described in sections 2 and 3 above.

For purposes of this proposal, a “grassroots lobbying communication” is a communication directed to the general public that (a) refers to specific legislation or regulation, (b) reflects a view on the legislation or regulation and (c) encourages the recipient of the communication to take action with respect to the legislation or regulation. “Indirect lobbying” is lobbying engaged in by a trade association or other organization of which UPS is a member.

“Direct and indirect lobbying” and “grassroots lobbying communications” include efforts at the local, state and federal levels.

The report shall be presented to the Nominating and Corporate Governance Committee and posted on UPS’s website.

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Shareowner Proposals

Shareowner’s Supporting Statement

We encourage transparency in UPS’s use of funds to lobby. UPS spent $68.1 million from 2010 – 2019 on federal lobbying. This does not include state lobbying, where UPS also lobbies but disclosure is uneven or absent. For example, UPS had at least 122 lobbyists in 29 states in 2019 (followthemoney.org) and spent $1.7 million on lobbying in California from 2010 – 2019.

UPS sits on the board of the Chamber of Commerce, which has spent over $1.6 billion lobbying since 1998, and belongs to the Business Roundtable (BRT), which spent over $43 million on lobbying for 2018 and 2019. UPS does not disclose its memberships in, or payments to trade associations, or the amounts for lobbying.

And UPS does not disclose its membership in tax-exempt organizations that write and endorse model legislation, such as the American Legislative Exchange Council (ALEC). UPS’s ALEC membership continues to draw scrutiny (https://www.prwatch. org/news/2020/05/13583/groups-call-alec%E2%80%99s-corporate-funders-cut-ties-over-its-coronavirus-lobbying). Over 110 companies have left ALEC, including ExxonMobil, Home Depot and Pepsi.

We are concerned that UPS’s seeming contradictions in public policy advocacy and limits in disclosure present reputational risks. For example, UPS signed the BRT Statement on the Purpose of the Corporation advocating socially responsible conduct, yet also attended the ALEC annual conference. (https://readsludge.com/2019/08/27/these-ceos-promised-to-be-socially-responsible-but-their-companies-are-pushing-alecs-right-wing-agenda/). And UPS strongly supports efforts to mitigate the impact of climate change, yet the Chamber opposed the Paris climate accord. UPS uses the Global Reporting Initiative for sustainability reporting yet fails to report “any differences between its lobbying positions and any stated policies, goals, or other public positions” under Standard 415.

We urge UPS to expand its lobbying disclosure.

Response of UPS’s Board

This requested report is unnecessary and would be an inefficient use of Company resources. UPS already provides extensive disclosures regarding lobbying and political activities and is transparent and accountable. In addition, the board of directors provides effective independent oversight of the Company’s lobbying and political activities. Preparing an additional special report beyond UPS’s current disclosures would not significantly alter the mix of information already publicly available. Additionally, UPS’s shareowners have rejected this proposal each year since 2012.

UPS already provides significant disclosures and is transparent and accountable

UPS complies with all applicable laws with respect to disclosing political and lobbying activities and, in some cases, goes beyond what is required. The following examples demonstrate UPS’s commitment to political transparency and accountability:

UPS provides significant disclosures about political spending: UPS publishes semi-annual reports disclosing the amounts and recipients, if any, of federal and state political contributions and expenditures made with corporate funds in the United States. UPS also discloses payments, if any, to trade associations that receive $50,000 or more from the Company and that use a portion of the payment for political expenditures pursuant to 26 U.S.C. §162(e)(1) (B). These reports can be found at www.investors.ups.com. UPS did not make any federal or state contributions or non-deductible political payments to covered trade associations during 2021.
UPS provides detailed information about lobbying activities: UPS files publicly available federal Lobbying Disclosure Act Reports each quarter. Links to these reports can be found at www.investors.ups.com. The reports provide information about expenditures for the quarter, describe the specific legislation that was the topic of communications, and identify the employees who lobbied on UPS’s behalf. UPS files similar periodic reports with state agencies reflecting state lobbying activities as required.

UPS has consistently been named a top company for political transparency and accountability

In 2021, for the eleventh straight year, the Center for Political Accountability Zicklin Index of Corporate Political Accountability and Disclosure ranked UPS among the top of S&P 500 companies for political transparency and accountability. A copy of the ranking can be found at https://www.politicalaccountability.net/cpa-zicklin-index/.

UPS protects and promotes shareowner value by participating in the political process

UPS is subject to extensive regulation at the federal, state and local levels. While there are many regulatory issues that impact our business, as a logistics company, we are focused on fair taxation, commercially reasonable regulation, expansive trade, and a level playing field with competitors. UPS also works to advance the interests of our employees when they intersect with our business operations.

We believe that we have a responsibility to our shareowners, employees and other stakeholders to engage in the political process, including through lobbying activities. We understand that individual stakeholders may disagree with certain positions expressed by various organizations. In fact, given the variety of business issues in which many trade associations and other groups are engaged, we do not necessarily agree with all positions taken by every organization in which we are a member. However, we

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generally believe that our membership in various organizations allows us to better advance UPS positions. In circumstances where we disagree with a policy position, we weigh the utility of continued membership against the consequences of differing positions or opinions.

The board provides independent oversight of UPS’s lobbying and political activities

UPS’s Chief Corporate Affairs Officer regularly reports to the Nominating and Corporate Governance Committee regarding UPS’s lobbying and political activities. In addition, the Nominating and Corporate Governance Committee, which is composed entirely of independent directors, reviews and approves UPS’s semi-annual political contribution report.

The board also monitors UPS’s memberships in trade associations and other tax-exempt organizations that engage in lobbying. UPS must often decide whether to participate in a variety of trade associations and other tax-exempt organizations. The Company may participate when involvement is consistent with specific UPS business objectives. These decisions are subject to board oversight and are regularly reviewed by the Nominating and Corporate Governance Committee.

Furthermore, UPS’s decision-making process for lobbying activities is transparent. UPS’s Public Affairs department works on furthering business objectives and on protecting and enhancing long-term shareowner value. This is accomplished by focused involvement at all levels of government. Moreover, the UPS Public Affairs department must approve all lobbying activities and any payments to trade associations or other tax-exempt organizations that engage in lobbying activities.

Preparing an additional report is unnecessary

The board believes UPS’s lobbying activities are transparent, and the approval of this proposal is unnecessary given the information that is already publicly available. Therefore, approval of this proposal would not result in an efficient use of resources and will only serve to benefit the limited interests of a small group of shareowners.

For these reasons, the board recommends that shareowners vote AGAINST this proposal.

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Shareowner Proposals

Proposal 5 — Shareowner Proposal Requesting the Board Prepare a Report on the Alignment of Lobbying Activities with the Paris Climate Agreement

What am I voting on? Whether you want to require the board to prepare a report on the alignment of UPS lobbying activities with the Paris Climate Agreement and how UPS plans to mitigate risks presented by any misalignment.

Board’s Recommendation: Vote AGAINST this proposal because:

UPS has recently adopted and published ambitious goals to reduce GHG emissions and achieve carbon neutrality by 2050
UPS already provides comprehensive and detailed annual sustainability disclosures
UPS also already provides significant lobbying and political disclosures, and is transparent and accountable
The board provides independent oversight of UPS’s lobbying

Vote Required: Approval by a majority of the voting power of the shares present in person or by proxy.

Shareowner Proposal

Mercy Investment Services, Inc., 2039 North Geyer Road, St. Louis, Missouri 63131-3332, has advised us that, along with co-proponents whose names, addresses and share ownership will be promptly provided upon oral or written request to the UPS Corporate Secretary, intends to submit the proposal set forth below for consideration at the Annual Meeting.

Resolved: Shareholders of United Parcel Service (“UPS”) request that the Board of Directors conduct an evaluation and issue a report within the next year (at reasonable cost, omitting proprietary information) describing if, and how, UPS’s lobbying activities (direct and through trade associations and social welfare and nonprofit organizations) align with the Paris Climate Agreement’s goal of limiting average global warming to well below 2 degrees Celsius and how the company plans to mitigate risks presented by any misalignment.

Shareowner’s Supporting Statement

According to the annual “Emissions Gap Report” issued by the United Nations Environment Programme (November 26, 2019), critical gaps remain between the commitments national governments have made and the actions required to prevent the worst effects of climate change. Companies have an important and constructive role to play in enabling policymakers to close these gaps.

Corporate lobbying activities that are inconsistent with meeting the goals of the Paris Agreement present regulatory, reputational, and legal risks to companies and investors and to the entire economy. Delays in implementation of the Paris Agreement increases the physical risks of climate change, poses a systemic risk to economic stability, and introduces uncertainty and volatility into our portfolios; Paris-aligned climate lobbying by companies and trade associations help to mitigate these risks.

As investors, we view fulfillment of the Paris Agreement’s goal—to hold the increase in the global average temperature to “well below” 2°C above preindustrial levels, and to pursue efforts to limit the temperature increase to 1.5°C — as an imperative. Of particular concern are trade associations that speak for business but, unfortunately, often present forceful obstacles to progress in addressing the climate crisis.

In 2020 and 2021, seven companies received shareholder resolutions urging their boards to publish evaluations of their climate lobbying efforts; six of those resolutions received a majority vote, demonstrating a tremendous show of investor interest in this issue. Numerous companies in both the U.S. and Europe have produced or agreed to issue reports evaluating their lobbying programs in the past two years.

We commend UPS for recently setting a Paris-aligned Net Zero emissions goal and a concrete plan to implement it. We believe a company should carefully evaluate whether its public policy advocacy advances or undercuts the goals of the Paris Agreement.

UPS presently provides insufficient information to help investors understand if or how UPS works to ensure that its lobbying activities, directly, in the company’s name, and indirectly, through membership organizations and trade associations, align with the Paris Agreement’s goals, and what management and the board do to address any misalignments found.

UPS is an active member of the American Legislative Exchange Council (ALEC), which frequently takes negative positions on climate change. UPS does not disclose what actions they take when an organization like ALEC contradicts UPS’s own climate positions. Similarly, UPS does not disclose how they engage major trade associations, such as the U.S. Chamber of Commerce, on climate lobbying activities.

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Response of UPS’s Board

UPS has recently adopted and disclosed comprehensive GHG reduction goals and already provides extensive sustainability and lobbying related disclosures. In addition, the Board of Directors provides effective oversight of the Company’s lobbying activities, and its sustainability goals and practices. As a result, preparing this requested report is unnecessary and would be an inefficient use of Company resources.

UPS has recently adopted and published ambitious goals to reduce GHG emissions and achieve carbon neutrality by 2050, including interim targets

UPS strives to be a good steward of the environment and is highly motivated to meet the Company’s ambitious sustainability goals. In 2021, we announced our new ESG strategy, including a commitment to become carbon-neutral across our global operations by 2050, including Scope 1, 2 and 3 emissions. We also developed and disclosed medium-term goals designed to help us achieve carbon neutrality. As part of this strategy, UPS intends to work with industry participants to accelerate the shift to sustainable aviation fuel (SAF). Our robust sustainability goals, and current progress towards achieving them, are further detailed in our corporate sustainability disclosures.

UPS already provides comprehensive and detailed annual sustainability disclosures

UPS already reports company-wide emissions and tracks and discloses target progress annually. Each year, we publish comprehensive sustainability related disclosures showcasing our commitments to our customers, our employees and the communities in which we operate. This includes disclosures under the Global Reporting Initiative (GRI), the Carbon Disclosure Project (CDP), the Sustainability Accounting Standards Board (SASB) and the Task Force on Climate-Related Financial Disclosures (TCFD) frameworks. We believe these disclosures provide shareowners the information they need to assess the Company’s sustainability efforts and progress.

UPS already provides significant political and lobbying disclosures, and is transparent and accountable

UPS complies with all applicable laws with respect to disclosing political and lobbying activities and, in some cases, goes beyond what is required. The following examples demonstrate UPS’s commitment to political transparency and accountability:

UPS provides significant disclosures about political spending: UPS publishes semi-annual reports disclosing the amounts and recipients, if any, of federal and state political contributions and expenditures made with corporate funds in the United States. UPS also discloses payments, if any, to trade associations that receive $50,000 or more from the Company and that use a portion of the payment for political expenditures pursuant to 26 U.S.C. §162(e)(1) (B). These reports can be found at www.investors.ups.com. UPS did not make any federal or state contributions or non-deductible political payments to covered trade associations during 2021.
UPS provides detailed information about lobbying activities: UPS files publicly available federal Lobbying Disclosure Act Reports each quarter. Links to these reports can be found at www.investors.ups.com. The reports provide information about expenditures for the quarter, describe the specific legislation that was the topic of communications, and identify the employees who lobbied on UPS’s behalf. UPS files similar periodic reports with state agencies reflecting state lobbying activities.

The board provides independent oversight of UPS’s sustainability efforts and lobbying activities

UPS’s Chief Corporate Affairs Officer regularly reports to the Nominating and Corporate Governance Committee regarding UPS’s sustainability efforts and lobbying activities. The board monitors UPS’s memberships in trade associations and other tax-exempt organizations that engage in lobbying, including on climate related matters. Furthermore, UPS’s decision-making process for lobbying activities, and its sustainability journey, is transparent. UPS’s Public Affairs department works with senior management on furthering business objectives and on protecting and enhancing long-term shareowner value.

Preparing an additional report is unnecessary

The board believes UPS’s sustainability goals are robust, and its policies and practices are transparent. Approval of this proposal is unnecessary given the information that is already publicly available. Therefore, approval of this proposal would not result in an efficient use of resources and will only serve to benefit the limited interests of a small group of shareowners.

For these reasons, the board recommends that shareowners vote AGAINST this proposal.

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Shareowner Proposals

Proposal 6 — Shareowner Proposal to Reduce the Voting Power of Class A Stock from 10 Votes Per Share to One Vote Per Share

What am I voting on?Whether you want the board to take steps to reduce the voting power of the Company’s class A stock from 10 votes per share to one vote per share.

Board’s Recommendation:Vote AGAINSTthis proposal because:

UPS’s capital structure has contributed to its long-term success
UPS’s capital structure is unique and does not present the concerns inherent in typical dual-class structures
UPS’s dual-class structure does not concentrate voting power or provide any level of control. Class A shares are held by more than 155,000 owners, and management, collectively, holds less than 1% of the voting power of our stock
UPS’s dual-class structure does not entrench management or the board. There is no controlling founder or family, and we regularly refresh management and the board
UPS’s governance documents provide additional safeguards against traditional dual-class concerns. Transfers of Class A shares are limited, resulting in conversions, and voting restrictions would apply upon the acquisition of a significant block of shares
Eliminating this structure will not further improve UPS’s corporate governance or financial performance

UPS’s capital structure is unique and does not present risks inherent in typical dual-class structures
UPS’s capital structure does not concentrate voting power or provide any holder a level of control. Class A shares are held by more than 155,000 owners, and management, collectively, holds less than 1% of the voting power of our stock
UPS’s capital structure does not entrench management or the board. There is no controlling founder or family, and we regularly refresh management and the board
UPS’s governance documents provide additional safeguards against traditional dual-class concerns, including a de facto “sunset” provision on outstanding shares and voting restrictions applicable to a significant voting block
UPS’s capital structure has contributed to its long-term success
Eliminating this structure will not further improve UPS’s corporate governance or financial performance
Vote Required:Approval by a majority of the voting power of the shares present in person or by proxy.

Shareowner Proposal

proxy and entitled to vote on the proposal.

Shareowner Proposal
John Chevedden, 2215 Nelson Avenue, No. 205, Redondo Beach, CA 90278, has advised us that he intends to submit the proposal set forth below for consideration at the Annual Meeting.

Share ownership will be promptly provided upon request to the UPS Corporate Secretary.

Proposal 6 —4 - Equal Voting Rights for Each Shareholder

RESOLVED:


pic_rights.jpg
Shareholders request that our Board of Directors take steps to ensure that all of our company’scompany's outstanding stock has an equal one-vote per share in each shareholder voting situation. This would encompass all practicable steps including encouragement and negotiation with current and future shareholders, who have more than one-vote per share, to request that they relinquish, for the common good of all shareholders, any preexisting rights, if necessary.

This proposal is not intended to unnecessarily limit our Board’sBoard's judgment in crafting the requested change in accordance with applicable laws and existing contracts. This proposal is important because certain shares have super-sized voting power with 10-votes per share compared to the weaklingonly one-vote per share for other shareholders. Corporate governance advocates have suggested a 7-year transition to equal voting rights for each share.

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In spite of lopsided shares having 10-times more voting power, support for this UPS proposal topic has steadily grown from 21% in 2013 to 29%33% in 2021.

2023.

With stock having 10-times more voting power UPS takes our shareholder money but does not give us in return an equal voice in our company’scompany's management. Without a voice, shareholders cannot hold management accountable. It is important to continue to vote for this proposal to block UPS management from finding creative ways to further reduce their money at risk at UPS while maintaining the same control.

Plus, with the UPS shareholder-unfriendly brand of corporate governance, we had no right to call a special meeting or act by written consent. And we were restricted by provisions mandating an undemocratic 80%-vote in order to make a certain improvements to our corporate governance. This undemocratic 80% vote requirement translates into a well over a 100% vote requirement from the shares that typicaltypically vote at the annual meeting.

And in spite of insider UPS shares having super voting power 5 UPS directors each received more than 140 million against votes in 2023. This compares to top bad things off our management recommended that they get a 3-year holiday on a shareholder vote on management pay. The vast majority of Fortune 500 companies have an annual shareholder vote on management pay. Excellent corporate governance is a cost-effective way to improve company stock performance.

As an example for9 UPS social and mobile-game maker Zynga announced moving to a single-class share structure in 2018. Zynga said its old multi-class share system could negatively impact its share price.

Corporate governance advocates as well as many investors and index managers have pushed back on the UPS-type dual-class structures. S&P Dow Jones Indices said that companies with multiple classes of shares would be barred from entering its flagship S&P 500 index.

directors each receiving less than 10 million against votes.

Please vote yes:
Equal Voting Rights for Each Shareholder — Proposal 6

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Response of UPS’s Board

UPS has a unique employee ownership culture that has helped it grow and thrive. Current and former employees have been significantimportant shareowners of the Company since its foundingwell before the Company’s IPO in 1907.1999. UPS founder Jim Casey fostered this culture and an ownership mindset by urging his partners to run their departments like their own small business.

The Company’s capital structure which has beenwas developed and implemented in place since UPS becameconnection with the IPO in order to help ensure employees, who would own only a public company in 1999,small portion of the number of shares outstanding, continued to feel like owners as contemplated by Jim Casey.
Our ownership structure includes class A and class B common stock. The class A shares are issued as incentive compensation and held by current and former UPS employees and their families many of whom owned UPS shares before the Company’s initial public offering.in order to further our culture and ownership mindset. The Company’s class B shares are publicly traded. This structure provides a significant incentive for our employees to take actions and make decisions that help facilitate UPS’s long-term success, resulting in aligned interests among all shareholders.shareowners. The structure also significantly enhances employee and retiree engagement.

engagement, while not exposing class B shareholders to financial or other risk.

UPS’s capital structure is unique and does not present risks inherent in typical dual-class structures
The board strongly disagrees with this proposal’s characterization of UPS’s capital structure. As described below, UPS’s unique capital structure does not present any of the risks that typically accompany dual-class capital structures, such as concentrated voting power within a limited number of people (such as company founders) who have interests that may not align with other shareowners, promotion of managerial entrenchment or provision for disparate financial returns. In fact, UPS’s governance provisions overlaying our capital structure are designed to limit any of these potential negative consequences.
UPS’s dual-class structure does not concentrate voting power or provide any holder a level of control; UPS’s governance documents would limit voting power in the event of vote concentration
Dual-class structures are typically designed to concentrate voting control in an individual or small group. UPS’s dual-class structure does not have this design or effect. The class A shares are widely issued and held; there are approximately 157,000 current and former employees who own the shares, from employees in our operations to executive officers. No single holder or group of holders owns any significant voting block. Our executive officers and directors, collectively, hold less than 1% of our total voting power. As a result, no founders, executive officers and directors, or other holders, are able to exercise control or any significant influence over voting decisions.
To further reduce any risk of any concentration of voting power and contrary to most dual-class structures, UPS’s certificate of incorporation (the “Certificate”) contains provisions that limit voting rights in the event of a concentration of ownership. Specifically, the voting power of any shareholder, whether the holder of class A or class B common stock, is curtailed if that holder controls over 25% of UPS’s outstanding voting power.
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UPS’s actual governance practices do not entrench management or the board
In many instances, dual-class capital structures have the purpose or effect of entrenching management or the board. UPS maintains robust corporate governance practices typical of more traditional capital structures, and its capital structure is not used for entrenchment purposes. The board regularly reviews and considers succession planning issues. Our CEO has served in that role only since June 2020, and we maintain an independent board chair. Also, since 2020, we have added five new board members, all of whom are diverse, and had four board members retire. In addition, during that time we added five new Executive Leadership Team members, three of whom are diverse, and had seven leave the Company.
UPS’s dual-class capital structure has an effective “sunset” exercised through both governance documents and corporate practice; no disparate financial treatment is allowed
UPS’s Certificate contains a number of provisions that provide additional safeguards against traditional dual-class concerns. For example, the Certificate contains provisions that provide an effective “sunset” provision on outstanding class A shares. This is accomplished through significant transfer restrictions; in most cases class A share transfers require or result in the conversion of those shares to class B shares. Further, the Company’s recent pay mix redesign - which has the effect of reducing the number of class A shares issued each year - will accelerate this reduction. As a result, the average annual decline in the number of outstanding shares of class A common stock has been 3% per year since the Company went public.
These governance principles run counter to traditional notions of dual-class structures. In addition, the Certificate generally requires equal economic treatment of the class A and class B common stock, ensuring that holders of one class would not receive disparate economic or financial treatment as a result of the different voting rights.
UPS’s capital structure has contributed to its long-term success

The interests of employees, who hold class A shares, go beyondprovisions underlying UPS’s current stock price and include operating the Company with a broader focus, which leads to long-term success. We owe our growth and achievements, to a significant degree, to the commitment ourdual-class capital structure has inspired in our employees and retirees.

This capital structure allows management to pursuedo not impact management’s pursuit of long-term growth strategies, and avoid the drawbacks associated with excessive emphasis on short-term goals.the short-term. Management is able to run theruns our Company with a sense of purpose by focusing on sustainable value creation benefiting all the Company’s stakeholders. In this regard, the interests of all UPS shareowners are aligned.

UPS’s capital structure is unique and does not present concerns inherent in typical dual-class structures

The board strongly disagrees with this proposal’s characterizationinterests of UPS’s capital structure. Some companies maintain multiple classes of stock to concentrate voting power with a limited number of people (such as company founders)employees, who have interests that may not align with other shareowners. Others embed the structure to promote managerial entrenchment or provide for disparate financial returns. None of those concerns are present at UPS.

UPS’s dual-class structure does not concentrate voting power or provide any level of control

UPS’s dual-class structure is unique in that thehold class A shares, are widely heldgo beyond UPS’s current stock price and include operating the Company with a broader focus, which is important to our long-term success. Our growth and achievements have been bolstered by approximately 155,000 current and former employees, from hourly employees to executive officers. Our executive officers and directors, collectively, hold less than 1% of the total voting power ofengagement our class A and class B common stock. As a result, UPS executive officers and directors are not able to exercise control or any significant influence over voting decisions, and do not have any level of control.

UPS’s dual-class structure does not entrench management or the board

UPS’s maintains robust corporate governance practices, and its capital structure is not used to entrench management or the board. The board regularly reviewshas inspired in our employees and considers succession planning issues. Our CEO has served in that role only since June 2020 and, since 2020, we have added five new board members and had four board members retire.

UPS’s governance documents provide additional safeguards against traditional dual-class concerns

UPS’s certificate of incorporation (the “Certificate”) contains a number of provisions intended to protect class B shareholders. Generally, class A shares convert to class B shares upon sale or transfer (unless transferred by an employee to a spouse or child), which over time has resulted, and is expected to continue to result, in a decline in outstanding shares of the class A stock, with the average annual decline of 3.4% per year since the Company went public. For example, as of March 1, 2021, class A common stock represented 17.0% of all outstanding shares of common stock, and as of March 1, 2022, represented 15.8% of all outstanding shares of common stock. The Certificate also contains provisions that would limit the voting power of any shareholder, whether the holder of class A or class B common stock, if that holder controlled over 25% of UPS’s outstanding voting power. In addition, the Certificate generally requires equal economic treatment of the class A and class B common stock, ensuring that holders of one class would not receive disparate treatment as a result of different voting rights.

retirees.

Eliminating this structure will not further improve UPS’s corporate governance or financial performance

UPS already maintains robust corporate governance practices. We provide shareownerspractices, and our corporate structure and practices do not present risks typically associated with an annual opportunity to vote on management pay (say on pay vote).dual-class structures. Other than our CEO, all UPS director nominees are independent. All UPS directors are elected annually by a majority of votes cast in uncontested director elections, only independent directors serve on the board’s Audit, Compensation and Human Capital, Nominating and Corporate Governance and Risk Committees, and we have an independent Board Chair. Our board consists of 46% female directors, 31% ethnically diverse directors, and contains an appropriate mix of newer and longer-tenured directors.

Changing

In recent periods, the board has voluntarily adopted a number of corporate governance principles aligned with marketplace developments. These include increasing disclosures around lobbying and participation in the political process, specifically assigning human capital structure is unnecessary

Theoversight responsibilities to the Compensation and Human Capital Committee, assigning environmental sustainability oversight responsibilities to the Nominating and Corporate Governance Committee, and adding to the Company’s proxy statement and sustainability reports gender and ethnicity information for employees and directors.

For the foregoing reasons, the board believes that UPS’s current capital structure does not present governance risks and continues to be in the best interests of the Company and its stakeholders. Shareowners have agreed with this assessment when they rejected similar proposals every year since 2013.

The board recommends that shareowners vote AGAINSTthis proposal.

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Table of Contents

Shareowner Proposals

Proposal 75 — Shareowner Proposal Requesting a Report on the Adoption of Independently Verified Science-Based Greenhouse Gas Emissions Reduction Targets

Risks Arising From Voluntary Carbon-Reduction Commitments

What am I voting on?Whether you want the Company to requirebe required to prepare an additional report analyzing the board to agree to alternative greenhouse gas emissions reduction targets.

risks arising from voluntary carbon-reduction commitments.

Board’s Recommendation:Vote AGAINSTthis proposal because:

UPS’s ESG goals include a plan to become carbon neutral across our global operations, including our airline, by 2050
Our strategy includes addressing airline fuel emissions and the electrification of our delivery fleet
UPS provides transparency, including comprehensive sustainability disclosures with regular updates on our progress
UPS is committed to continuing to reduce our carbon footprint in a comprehensive and responsible manner

UPS already provides significant transparency, including comprehensive disclosures with regular updates on our progress, and on risks and opportunities associated with our emissions reductions efforts
The UPS board provides effective oversight of UPS’s strategy, which includes risks and opportunities associated with emissions reductions efforts
Management’s execution of our strategy is grounded in a fiscally responsible approach using sound engineering principles
Management engages with key stakeholders to provide appropriate periodic updates on risks and opportunities
Vote Required: Approval by a majority of the voting power of the shares present in person or by proxy.

Shareowner Proposal

Green Century Capital Management, Inc., 114 State Street, Suite 200, Boston, MA 02109, Trillium Asset Management LLC, Two Financialproxy and entitled to vote on the proposal.

Shareowner Proposal
The National Center 60 South Street, Suite 1100, Boston, MA 02111, and Zevin Asset Management, LLC, 2 Oliver Street, Suite 806, Boston, MA 02109, havefor Public Policy Research, 2005 Massachusetts Ave. NW, Washington, DC 20036 has advised us that they intend to submit the proposal set forth below for consideration at the Annual Meeting on behalfMeeting. Share ownership will be promptly provided upon request to the UPS Corporate Secretary.
Reduce Company Greenwashing Risk
Whereas: Shareholders must protect our assets against potentially unfulfillable Company ESG promises, including the extent to which the Company can reduce Scope 1, 2, and 3 greenhouse gas (GHG) emissions.
The Securities and Exchange Commission (SEC) has taken enforcement actions related to Environmental, Social, Governance (ESG) issues or statements by companies who misrepresent or engage in fraud related to ESG efforts.1
In 2021, the SEC created the Climate and ESG Task Force in its Division of Enforcement.2 The focus of the Green Century Balanced Fund, the James T. Campen Trust, and the John Hancock ESG Large Cap Core Fund.

Whereas: In 2018, the Intergovernmental Panel on Climate Change evaluated the goals of the 2015 Paris Agreement and advised that net carbon emissions must fall 45% by 2030 and reach net zero by 2050Task Force is "to identify any material gaps or misstatements" in order to limit warming below 1.5 degrees Celsius and prevent the worst consequencesdisclosure of climate change. However,risks and analyze "compliance issues relating to investment advisers' and funds' ESG strategies."3

The Task Force has taken numerous enforcement actions including charging Goldman Sachs Asset Management for policies and procedures failures related to ESG investments, resulting in 2020, the UN reported the world is “way off-track” from achieving these goals.1

Exceeding 1.5 degrees Celsius presents risksa $4 million penalty,4 and charging DWS Investment Management Americas Inc. in part for misstatements regarding its ESG investment process that resulted in an overall $25 million in penalties.5

The SEC has proposed to the global economyrequire companies to disclose information about their Scope 1 and investors: up to 10% of total global economic value is projected to be lost by 2050 under current emissions trajectories. A warming climate is associated with supply chain disruptions, reduced resource availability, lost production, political instability, reduced worker efficiency, and adverse health impacts that disproportionally affect low-income communities and communities of color.2Additionally, particulate matter emissions from heavy-duty diesel vehicles pollute communities of color at significantly higher rates than white communities.3

While UPS has announced a goal to achieve carbon neutrality in its operations by 2050 and a 50% reduction in emissions per small package delivered by 2035, shareholders do not know if UPS plans on achieving net zero through actual emissions reductions or through the purchase of carbon offsets. In order to assure shareholders that its goals align with the Paris Agreement, UPS should set a science-based target verified by the Science Based Targets Initiative (SBTi), which requires annual disclosure of emissions.

Whereas peers like FedEx and Amazon have set goals for procurement of electric vehicles, UPS’ goals for its ground fleet rely on alternative fuel, which unnecessarily prolongs potential emissions, and bolsters fossil fuel infrastructure.4 UPS’ current emissions reduction goals do not includeto require them to disclose Scope 3 emissions which, according"if material or if the registrant has set a GHG emissions target or goal that includes Scope 3 emissions.”6

The Environmental Protection Agency defines Scope 3 emissions as, "the result of activities from assets not owned or controlled by the reporting organization, but that the organization indirectly affects in its value chain."7Put differently, "Scope 3 emissions for one organization are the scope 1 and 2 emissions of another organization."8 This means that Scope 3 emissions are already counted as another entity's emissions, and are external to UPS’ 2020 TCFDthe reporting company, such as product use and how employees commute.9
1 https://www.sec.gov/securities-topics/enforcement-task-force-focused-climate-esg-issues
2 https://www.sec.gov/news/press-release/2021-42
3 https://www.sec.gov/news/press-release/2021-42; https://www.sec.gov/securities-topics/enforcement-task‑force-focused-climate-esg-issues
4 https://www.sec.gov/news/press-release/2022-209
5 https://www.sec.gov/news/press-release/2023-194
6 https://www.sec.gov/news/press-release/2022-46
7 https://www.epa.gov/climateleadership/scope-3-inventory-guidance
8 https://www.epa.gov/climateleadership/scope-3-inventory-guidance
9 https://www.epa.gov/climateleadership/scope-3-inventory-guidance
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Voluntary commitments to reduce carbon emissions create unnecessary risk for the Company because of the lack of scientific consensus over the ability to achieve net zero emissions.
In August 2023, the Global Climate Intelligence Group asserted, "There is no climate emergency."10 The declaration includes 1,609 signatories and "oppose[s] the harmful and unrealistic net-zero CO2 policy proposed for 2050.”11
A June 2023 study by the Energy Policy Research Foundation found that net zero advocates have misconstrued the International Energy Agency's position on new oil and gas investment and that it has made questionable assumptions and milestones for NZE about government policies, energy and carbon prices, behavioral changes, economic growth, and technology maturity.12
Supporting Statement: UPS voluntarily reports on Scope 1, 2 and 3 emissions and makes voluntary commitments to reduce them.13 UPS does so even though it has failed to report constitute 57%on its evaluation of its total.5

the technological or financial feasibility of such commitments. Given the impact ofSEC's climate change onand ESG enforcement actions, the economy, the environment,Company must exercise caution and human systems, and UPS’s contribution to it, proponents believe the UPS board and management have a responsibility to its investors and stakeholders to adopt GHG goals aligned with a 1.5 degree scenario and to outline a clear plan that demonstrates accountability. Independently verified, science-based goals covering Scopes 1-3 would provide shareholders with objective assurance that UPS is doing its part to reduce emissions in a comprehensive and timely manner.

transparency about such commitments.

Resolved: Shareholders request that UPS adopt independently verified short, medium, and long-term science-based greenhouse gas emissions reduction targets, inclusive of emissionsthe Company produce a report analyzing the risks arising from its full value chain, in order to achieve net-zero emissions by 2050 or sooner and to attain appropriate emissions reductions prior to 2030, in line with the Paris Agreement’s goal of maintaining global temperature rise at 1.5 degrees Celsius.

voluntary carbon-reduction commitments.
1https://library.wmo.int/doc_num.php?explnum_id=10211
2https://www.swissre.com/institute/research/topics-and-risk-dialogues/climate-and-natural-catastrophe-risk/expertise-publication-economics-of-climate-change.html
3https://www.nytimes.com/2021/04/28/climate/air-pollution-minorities.html
4https://www.sightline.org/2021/03/09/the-four-fatal-flaws-of-renewable-natural-gas/
5https://about.ups.com/content/dam/upsstories/assets/reporting/sustainability-2021/2020_UPS_TCFD_Report_081921.pdfResponse of UPS’s Board
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Supporting Statement: In assessing targets, we recommend, at management’s discretion:

Consideration of approaches used by advisory groups such as the Science Based Targets initiative;
Disclosing these targets to investors at least 180 days prior to the next annual meeting.

Response of UPS’s Board

UPS supports global efforts to mitigate the impact of climate change. Sustainability is an inherent part of UPS’s overall business and operating strategy, and business operations. Wewe take a comprehensive, global approach to reducing energy use and GHG emissions within our networks,network, as well as major portions of our value chain. UPS takes a fiscally responsible approach utilizing sound engineering principles in the execution of our strategy. The UPS board provides effective oversight of UPS’s strategic risks and opportunities. Management’s day-to-day execution of our strategic objectives involves a multi-layered approach facilitated by an understanding of our business, the macroeconomic environment and the associated risks and opportunities. We report publicly on risks and opportunities associated with our approach and progress toward our goals on a regular basis. As a global leader in logistics and supply chain solutions, we transport packages, facilitate international trade, and apply advanced technologyresult, the requested report would not significantly alter the mix of information available.

UPS is committed to efficiently manage the world of business. In this role, we have an opportunity to reduce GHG emissions throughout the supply chains of many businesses, including by efficiently consolidating multiple shipments and otherwise reducing our carbon intensity.

UPS’s ESG goals include a plan to become carbon neutral across our global operations, including our airline, by 2050

UPS effectively manages to meet the Company’s ambitious sustainability goals. In 2021, we announced our new ESG strategy, including a commitment to become carbon-neutral across our global operations by 2050, including Scope 1, 2 and 3 emissions. We also developed medium-term goals designed to help us achieve carbon neutrality, including adopting interim targets to reduce carbon emissions per package within our small package operations by 50% against a 2020 baseline; to be fully powered by renewable electricity in our facilities; and to fuel 30% of our global air fleet using sustainable sources by 2035. Our robust sustainability goals, and current progress towards achieving them, are further detailed in our corporate sustainability disclosures.

Our strategy includes addressing airline fuel emissions, the electrification of our delivery fleet, and includes Scope 3 emissions

UPS takes seriously the need to transform our delivery fleet and has already made significant strides to this end. In developing our strategy, we evaluated the adoption of science-based targets. We determined that there are no scalable solutions for aircraft or heavy-duty vehicles at this time to achieve a science-based target by 2030 or 2035. The primary decarbonization pathfootprint for the aviation sector is SAF,benefit of all stakeholders, and more innovation is needed. In order to achieve our 30% SAF by 2035 goal, we are engaging with airline industry and non-governmental organizations to evaluate the availability and commercial feasibility of SAF.

In 2020, aircraft fuel made up 61% of our total Scope 1 and Scope 2 GHG emissions. Our Fuel Analytics and Sustainability Group continuously evaluates opportunities to further reduce our emissions in this area, including accelerating efforts to reduce the carbon intensity of our fleet. We currently have one of the youngest, most fuel-efficient fleets in the industry. We take a disciplined approach to emissions reductions. When appropriate, we make capital investments in newer, more fuel-efficient aircraft. We recently announced the purchase of 19 new freighter aircraft, which will make our fleet more efficient and reliable. In addition, we look for opportunities to retrofit older aircraft to further increase efficiency with the goal of lowering our carbon footprint.

Additionally, UPS’s fleet of more than 13,300 alternative fuel and advanced technology vehicles includes all-electric, hybrid electric, hydraulic hybrid, ethanol, compressed natural gas (CNG), liquefied natural gas (LNG) and propane vehicles. We continue to expand this specialized fleet, having placed an order for 125 Tesla all-electric semi-trucks, and having announced a commitment to purchase up to 10,000 electric vehicles from Arrival, which are expected to be delivered beginning in 2022. Along with these commitments, and as part of UPS’s continued efforts to build an integrated fleet of electric vehicles, our venture capital arm, UPS Ventures, evaluates investments to allow us to collaborate and support the development of EV technologies.

UPS provides transparency, includingtransparent, comprehensive sustainability disclosures with regular updates on our progress

UPS is committed to sustainable business practices and transparent sustainability reporting. We published our first Corporate Sustainability Report in 2003. Each year, UPS reports company-wide emissions and tracks and discloses progress towards our targets. Wewe publish comprehensive sustainability related disclosures showcasing our commitment to our investors, our customers, our employees and the communities in which we operate. These include disclosures under the Global Reporting Initiative (GRI),(“GRI”) and the Carbon Disclosure Project (CDP), the Sustainability Accounting Standards Board (SASB)(“CDP”) frameworks, as well as an annual Social Impact Report which highlights our efforts to empower resilient, just and the Task Force on Climate-Related Financial Disclosures (TCFD) frameworks. UPS’s sustainability disclosures are extensive, targeted, and inclusive of Scope 1, Scope 2, and Scope 3 GHG emissions.safe communities. We believe these disclosures provide stakeholders the information they need to assess our sustainability efforts and progress.

Additional material issues are discussed in our periodic filings with the SEC.

The UPS board provides effective oversight of UPS’s strategy, which includes risks and opportunities associated with emissions reductions efforts
The board's oversight responsibilities include strategic planning, risk management and financial reporting. This includes oversight of climate-related matters as a part of the Company’s overall business strategy. The board considers climate-related risks and opportunities in numerous ways, including through its standing committees. The board’s Risk Committee, consisting entirely of independent directors, is committed to continuing to reduceresponsible for oversight of management’s identification and evaluation of enterprise risks, including the Company’s climate-related risks. Economic, environmental and social sustainability risks and opportunities are considered as part of our carbon footprint incomprehensive enterprise risk management program. Under our enterprise risk management process, risks, including climate-related, are identified, prioritized and assigned an owner, who is responsible for developing mitigation plans. The Risk Committee reviews these items on a comprehensive and responsible manner

We believe everyone shares responsibility to improve energy efficiency and reduce GHG emissions. UPS supports global efforts to mitigate the impact of climate change. Our optimized global smart logistics network, combined with our global GHG strategy, helps improve our efficiency and reduce our environmental impact. This technology and innovation driven strategy includes the following:

regular basis.


10 https://clintel.org/wp-content/uploads/2023/08/wcd-version-081423.pdf
11 https://clintel.org/wp-content/uploads/2023/08/WCD-version-081423.pdf
12 https://assets.realclear.com/files/2023/06/2205_a_critical_assessment_of_the_ieas_net_zero_scenario_esg_and_the_cessation_of_investment_in_new_oil_and_gas_fields.pdf
13 https://about.ups.com/content/dam/upsstories/assets/reporting/sustainability-2021/2020_UPS_TCFD_Report_081921.pdf
Maintaining a leadership role in decarbonizing the transportation and logistics industries;
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Operational improvements through technology to create overall network and delivery efficiencies beyond miles/fuel that reduce our GHG footprint;
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Notice of Annual Meeting of Shareowners and 20222024 Proxy Statement

The board’s Nominating and Corporate Governance Committee, also consisting entirely of Contents

Shareowner Proposals

Expanding our fleet of alternative fuel and advanced technology vehicles, known as our Rolling Laboratory, in order to reduce the proportion of conventional fuels we use;
Supporting the testing and development of alternative air solutions, including drone delivery and the use of SAF;
Reducing conventional and increasing renewable energy use in our facilities;
Providing customers with services that help them reduce their environmental impact; and
Helping increase supplier awareness about GHG emissions and how to reduce them.

The board believes this proposal is unnecessary given the information that is already publicly available. Therefore, approval of this proposal would not result in an efficient use of resourcesindependent directors, has additional oversight responsibility for environmental risks and will only serve to benefit the limited interests of a small group of shareowners.

For these reasons, the board recommends that shareowners vote AGAINST this proposal.

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Proposal 8 — Shareowner Proposal Requesting a Report on Balancing Climate Measuresopportunities. This committee receives regular updates and Financial Returns

What am I voting on? Whether you want to require the board to publish a report on UPS decisions regarding GHG emissions reductions in light of financial performance and environmental costs and risks of climate change.

Board’s Recommendation: Vote AGAINST this proposal because:

Commissioning this report is misguided and impracticable
UPS already provides transparency, including comprehensive sustainability disclosures with regular updates on our progress
UPS continues to demonstrate our commitment to reducing our carbon footprint for the benefit of all stakeholders

Vote Required: Approval by a majority of the voting power of the shares present in person or by proxy.

Shareowner Proposal

Myra K. Young, 9295 Yorkship Court Elk Grove, CA 95758, has advised us that she intends to submit the proposal set forth below for consideration at the Annual Meeting.

ITEM 8: Report on balancing climate measures and financial returns

RESOLVED, shareholders ask the board to commission and publish a report on (1) the extent (if any) to which Company decisions involving greenhouse-gas emissions reduction prioritize Company financial performance over the environmental costs and risks of climate change and (2) the manner in which any consequent environmental costs and risks threaten returns of diversified shareholders who rely on a stable and productive economy.

Supporting Statement:

In 2020, the Company announced a roadmap to carbon neutrality in 2050. The Company has established the following specific goals:

By 2025
25 percent renewable electricity for facilities
40 percent alternative fuel purchases as a percent of total ground fuel
By 2035
30 percent sustainable aviation fuel
100 percent renewable electricity for facilities
50 percent reduction in carbon dioxide per package delivered for global small packages.1

These goals do not appear consistent with the consensus on measures necessary to keep global warming below disastrous levels. More consistent measures could include:

Meeting a 1.5-degree Celsius Science-Based Target standard
Achieving a 50 percent reduction in greenhouse-gas emissions by 2030
Committing to purchasing only electric light-duty vehicles by 2025

The gap betweendiscusses the Company’s declaredprogress towards its sustainability-related goals and “Paris alignment” may be due to the Company’s decision only to address the risk of climate change to the enterprise, rather than addressing the risks the Company poses to the environment: while the Company identifies climate change as having “inherently high risk to the organization,” 2 the public documents that discuss the Company’s climate stance disclose no consideration of climate change’s broad environmental stakes such as:

Halving GDP growth by the end of the century3
Having “broad implications for macroeconomic performance, including inflation, interest rates, balance of payments, productivity, wealth, and gross domestic product (GDP) growth”4
Shrinking the world economy by 3 percent by 2050.5
1https://investors.ups.com/_assets/ups/files/pages/ups/db/1149/description/UPS+ESG+Strategy+June+2021.pdf
2https://about.ups.com/content/dam/upsstories/assets/reporting/sustainability-2021/2020_UPS_TCFD_Report_081921.pdf
3https://www.cftc.gov/sites/default/files/2020-09/9-9-20%20Report%20of%20the%20Subcommittee%20on%20Climate- Related%20Market%20Risk% 20%20Managing%20Climate%20Risk%20in%20the%20U.S.%20Financial%20System%20for%20posting.pdf
4Id.
5https://www.eiu.com/n/global-economy-will-be-3-percent-smaller-by-2050-due-to-lack-of-climate-resilience.
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Shareowner Proposals

Lowered GDP will directly reduce returns to diversified investors,6 and a warming planet may create serious disruption costs that further threaten financial markets.7 By adopting a slower pace of mitigation, the Company is able to increase its margins and financial performance. But improved Company financial performance that comes at the expense of the environment and the economy is a bad trade for most Company shareholders, who are diversified and rely on broad economic growth to achieve their financial objectives.

This proposal asks for a report that analyzes the climate trade-offs the Company makes between financial return and the global economy, and how those trade-offs affect diversified shareholders. Such a report would not require precision: identifying areas where the Company is choosing not to accelerate decarbonization and analyzing how such choices manifest as costs or risks to diversified portfolios would help determine whether and when the Company should prioritize Paris alignment over financial returns.

Please vote for: Report on balancing climate measures and financial returns – Proposal 8

Response of UPS’s Board

UPS supports global efforts to mitigate the impact of climate change. Sustainability is an inherent part of UPS’s strategy and business operations. We believe that seeking to maximize shareholder value necessarily takes into account the interests of all stakeholders and our decarbonization efforts call for multi-year capital deployment based on effective solutions.

We take a comprehensive, global approach to reducing energy use and GHG emissions within our networks, as well as major portionsthe associated risks and opportunities, with feedback from these discussions shared with the full Board. The board’s Audit Committee, consisting entirely of independent directors, is responsible for overseeing the annual engagement of the independent third party that provides assurance on the Company’s annual sustainability report.

The board delegates authority for day-to-day management of the Company and its operations, including those related to climate matters, to the Executive Leadership Team. The board and its committees regularly receive updates from management regarding the effectiveness of policies and procedures, progress regarding targets, risks and opportunities, global compliance standards and other priority climate-related topics. The Company’s Chief Corporate Affairs and Sustainability Officer (the “CCASO”), who is a member of the Executive Leadership Team and a direct report to the CEO, is responsible for leading climate-related discussions with the board. The CCASO reports quarterly to the Nominating and Corporate Governance Committee and regularly to the full board on climate-related matters.
Additionally, efforts to monitor, assess and manage climate-related risks are supported across the Executive Leadership Team. For example, the CFO co-chairs the Company’s Sustainability Council with the CCASO. The CCASO also serves on the Company’s executive officer level risk committee, which meets quarterly to review the Company’s enterprise risk strategy, including climate-related risks.
Management’s execution of our value chain. strategy is grounded in a fiscally responsible approach using sound engineering principles
We approach sustainable development holistically so that our cross-functional sustainability initiatives align with our Customer First, People Led, Innovation Driven strategy. This strategy is guiding us towards our goals of carbon neutrality by 2050 and improving the well-being of one billion lives by 2040.We offer our customers a number of sustainable solutions to help them measure and manage the carbon emissions in their supply chain, as well as design more sustainable packaging, including UPS carbon impact analysis, UPS carbon neutral shipping, supply chain optimization analyses, UPS co-innovation workshops, an Eco Responsible packaging program and Packsize on-demand packaging.
A component of UPS's short, medium- and long-term strategy is to evaluate and implement new technologies to improve efficiency and maintain one of the most efficient air and ground fleets in our industry in a manner that balances risks and opportunities. This is accomplished through our “Rolling Laboratory” approach. Through this approach UPS works with manufacturers, government agencies and other stakeholders around the world to pilot projects before determining whether and how new vehicles and technologies are ready for commercial deployment. Under this approach, Alternate fuel vehicles or advanced technologies adopted by UPS must meet the following criteria:(1) the fuel/technology must be safe; (2) it must have a reliable fueling infrastructure; (3) the supply of vehicles and parts must be predictable; (4) there must be a measurable improvement in emissions and/or fuel savings; and (5) it must be economically viable in terms of initial purchase price, maintenance costs and reliability and adapt to our fleet use characteristics.
As a global leaderresult, UPS undertakes multiple initiatives simultaneously to reduce risk. The Company is currently focused on five key levers to decarbonize our business: network efficiency and innovation; increasing sustainable aviation fuel availability; renewable/biofuel solutions; fleet electrification; and renewable electricity transformation. We report on our progress on initiatives on a regular basis both internally and externally.
Management engagement with key stakeholders supplements our other disclosures
As discussed elsewhere in logisticsthis Proxy Statement, maintaining open and supply chain solutions,ongoing dialogs with key stakeholders is an important component of our corporate culture. In addition to information available in our written reports, our management team participates in numerous investor meetings throughout the year to discuss our business, strategy, including our emissions reductions targets, and financial results. In addition, each year we transport packages, facilitate international trade,undertake a stakeholder outreach program in which we discuss, among other things progress on our environmental sustainability journey. This includes discussions with key stockholders, UPS retirees and apply advanced technologyother stakeholders. This year we contacted holders of over 47% of our class B common stock as a part of this program. Engagement provides us with the opportunity to efficiently manage the world of business. In this role, we haveappropriately update stakeholders on recent accomplishments, risks and opportunities, and to receive feedback on our efforts. Similarly, it provides us with an opportunity to reduce GHG emissions throughout the supply chains of many businesses, including by efficiently consolidating multiple shipments and otherwise reducing carbon intensity.

Commissioning this report is misguided and impracticable

Commissioning a report to extrapolate the extent to which Company decisions involving GHG emissions reductions prioritize financial performance over environmental costs and climate change risks and impact the global economy and overall market returns of diversified investors is misguided and impracticable. Among other things, it would require a variety of assumptions and estimates, and would necessarily be limited in quantifying the impact of one aspect of the Company’s operations on the global economy or on shareowners worldwide who hold diversified portfolios.

UPS already provides transparency, including comprehensive sustainability disclosuresdiscuss how management believes its actions are aligned with regular updates on our progress

We disagree with the proponent’s assertion that the Company’s current sustainability reporting efforts are insufficient in this regard, or that they “only [ ] address the risk of climate change to the enterprise.” UPS provides transparency, including comprehensive sustainability disclosures with regular updates on our progress.

Each year, UPS reports company-wide emissions and tracks and discloses progress towards our targets. We publish comprehensive sustainability related disclosures showcasing our commitment to our investors, our customers, our employees and the communities in which we operate. These include disclosures under the Global Reporting Initiative (GRI), the Carbon Disclosure Project (CDP), the Sustainability Accounting Standards Board (SASB) and the Task Force on Climate-Related Financial Disclosures (TCFD) frameworks. UPS’s sustainability disclosures are extensive, targeted, and inclusive of Scope 1, 2, and 3 GHG emissions.

In light of the wealth of macroeconomic information and expertise presently available, we do not believe the requested report would significantly alter the mix of information available. Therefore, producing yet another report discussing the Company’s sustainability practices is unnecessary, not an efficient use of resources, and not in the best interests of the Company or its shareowners.

UPS continues to demonstrate our commitment to reducing our carbon footprint for the benefit of all stakeholders

We believe everyone shares responsibility to improve energy efficiency and reduce GHG emissions. UPS supports global efforts to mitigate the impact of climate change. Our optimized global smart logistics network, combined with our global GHG strategy, helps improve our efficiency and reduce our environmental impact. This technology and innovation driven strategy includes the following:

Maintaining a leadership role in decarbonizing the transportation and logistics industries;
Operational improvements through technology to create overall network and delivery efficiencies beyond miles/fuel that reduce our GHG footprint;

6 Ibid n. 2.

7 Supra, n.3

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Expanding our fleet of alternative fuel and advanced technology vehicles, known as our Rolling Laboratory, in order to reduce the proportion of conventional fuels we use;
Supporting the testing and development of alternative air solutions, including drone delivery and the use of SAF;
Reducing conventional and increasing renewable energy use in our facilities;
Providing customers with services that help them reduce their environmental impact; and
Helping increase supplier awareness about GHG emissions and how to reduce them.

Preparing an additional report is unnecessary

For all of the foregoing reasons, the board believes producing this report is unnecessary, not an efficient use of resources and will only serve to benefit the limited interests of a small group of shareowners.

For these reasons, the board recommends that shareowners vote AGAINSTthis proposal.

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Shareowner Proposals

Proposal 96 — Shareowner Proposal Requesting the Board Prepare an Annual Report on Diversity, Equity and Inclusion

What am I voting on? Whether you want the Company to require the boardbe required to prepare an additional report on diversity, equity and inclusion.

Board’s Recommendation:Vote AGAINSTthis proposal because:

UPS has taken significant steps to develop and maintain a diverse and inclusive workforce
UPS’s commitment to diversity is reflected in our workforce demographics
UPS already provides investors with significant diversity and inclusion data
UPS has consistently been named a top company for diversity, equity, and inclusion
The board provides independent oversight of UPS’s human capital management

UPS has taken significant steps to develop and maintain a diverse and inclusive workforce
UPS’s commitment to diversity is reflected in our workforce demographics
UPS provides investors with significant diversity and inclusion information
UPS has consistently been named a top company for diversity, equity, and inclusion
The board provides independent oversight of UPS’s human capital management
Vote Required: Approval by a majority of the voting power of the shares present in person or by proxy.

Shareowner Proposal

proxy and entitled to vote on the proposal.

Shareowner Proposal
As You Sow, 2020 Milvia St. Suite 500, Berkeley, CA 94704, and Booth Investments, LLC, has advised us that they intendit intends to submit the proposal set forth below for consideration at the Annual Meeting on behalf of Booth Investments, LLC.

Whereas: Numerous studies by respected organizations such as The Wallthe Marguerite Casey Foundation and Mack Street Journal, Credit Suisse, Morgan Stanley, McKinsey, and BCG have pointed2016 Trust. Share ownership will be promptly provided upon request to the material benefits of a diverse workforce.

Companies should look to hire the best talent. However, Black and Latino applicants face recruitment challenges. Results of a meta-analysis study of 24 field experiments, dating back to 1990, foundUPS Corporate Secretary.

Resolved: Shareholders request that with identical resumes, White applicants receive an average of 36 percent more callbacks than Black applicants and 24 percent more callbacks than Latino applicants.”1

Promotion rates show how well diverse talent is nurtured at a company. Women and non-White employees experience “a broken rung” in their careers. For every 100 men who are promoted, only 86 women are promoted. Non-White women are particularly impacted, comprising 17 percent of the entry level workforce and only 4 percent of executives.2 Employees with the potential for advancement have a higher retention rate.3

Morgan Stanley has found that: “Employee retention that is above industry peer averages can indicate the presence of competitive advantage. This advantage may lead to higher levels of future profitability than past financial performance would indicate.”4 Companies with high employee satisfaction have also been linked to annualized outperformance of over two percent.5

The United Parcel Service Inc. (“UPS”inc. ("UPS") Board has stated, “UPS views diversity, equity, and inclusion as a strategic imperative that enables the company to attract and retain talented employees, foster innovation to enhance customer service, and bring strength and stability to businesses and communities.”6

However, UPS has released only retention and recruitment rates by gender. It has not shared sufficient recruitment, retention, or promotion data by race and ethnicity to allow investors to determine the effectiveness of its human capital management programs.

Between September 2020 and September 2021, the number of S&P 100 companies releasing recruitment rate data by gender, race and ethnicity increased by 234 percent, companies releasing retention rate data increased by 79 percent, and companies releasing promotion rate data increased by 379 percent.

Alaska Air Group, Boeing, Norfolk Southern Corp., and Uber all release more inclusion-focused data than UPS does. UPS is increasingly a laggard in its decision to continue to withhold these data sets. UPS’ Investors may wish to be particularly vigilant in their assessment of diversity programs at UPS, as the company has faced a number of allegations of discrimination on the basis of race and religion.

1https://hbr.org/2017/10/hiring-discrimination-against-black-americans-hasnt-declined-in-25-years
2https://wiw-report.s3.amazonaws.com/Women_in_the_Workplace_2021.pdf
3https://www.benefitspro.com/2019/04/17/promotions-play-a-key-role-in-employee-turnover/?slreturn=20210926165506
4https://www.morganstanley.com/im/publication/insights/articles/article_culturequantframework_us.pdf
5https://www.institutionalinvestor.com/article/b1tx0zzdhhnf5x/Want-to-Pick-the-Best-Stocks-Pick-the-Happiest-Companies?utm_medium=email&utm_campaign=The%20Essential%20II%20100721&utm_content=The%20Essential%20II%20100721%20CID_eb103a9e15359075f72a85f7ff534c79&utm_ source=CampaignMonitorEmail&utm_term=Want%20to%20Pick%20the%20Best%20Stocks%20Pick%20the%20Happiest%20Companies
6https://www.sec.gov/Archives/edgar/data/1090727/000120677421000883/ups3861781-def14a.htm
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Resolved: Shareholders request that UPS report to shareholders on the effectiveness of the Company’sCompany's diversity, equity, and inclusion efforts. The reportingreport should be done at reasonable expense, exclude proprietary information, and addressprovide transparency on outcomes, using quantitative metrics for recruitment,workforce diversity, hiring, promotion, and retention and promotion of employees, including data by gender, race, and ethnicity.

Supporting Statement:Quantitative data is sought so that investors can assess understand, and compare the effectiveness of companies’companies' diversity, equity, and inclusion programsprograms.
It is advised that this content be provided through UPS's existing sustainability reporting infrastructure. An independent report specific to this topic is not requested.
Whereas: As of the date of the filing of this proposal, UPS had not yet shared sufficient hiring, promotion or retention data to allow investors to determine the effectiveness of its diversity and apply this analysis to investors’ portfolio management and securities’ selection process.

Response of UPS’s Board

inclusion programs.

Of public American companies, UPS is the second largest employer who has not agreed to provide any hiring, promotion, or retention data by their employees' race or ethnicity. Large employers that provide, or have committed to provide, more inclusion factor data than UPS include, but are not limited to: Alphabet, Boeing, Comcast, CVS Health, Gap, General Motors, General Dynamics, Honeywell International, IBM, McDonald's, Microsoft, Procter & Gamble, Raytheon, Union Pacific, Walt Disney, and Walmart.
As You Sow and Whistle Stop Capital released research in November 20231 that reviewed over 4,500 EEO-1 reports, which show corporate workforce diversity. The data shows a global company -positive correlation between manager diversity and corporate performance. Additional research includes:
Hiring: Studies conducted by economists at the University of Chicago and UC Berkeley found that “discriminating companies tend to be less profitable,” stating “it is becoming even more so as muchcostly for firms to discriminate against productive workers.”2 Promotion: Without equitable promotional practices, companies will be unable to build the necessary employee pipelines for diverse management. Women and employees of color experience "a broken rung" in their careers; for every 100 men who are promoted, only 87 women are. Whereas women of color comprise 18 percent of the world’s economicentry-level workforce and population growth continues to occur in emerging markets. With more than halfonly 6 percent of executives.3
Retention: Retention rates indicate if employees believe a million employees around the world, company represents their best opportunity. Morgan Stanley has found that employee retention above industry average can indicate a competitive advantage and higher levels of future profitability.4

1 https//www.asyousow.org/report-page/2023-positive-relationships-linking-workforce-diversitv-and-financial-performance
2https://www.nytimes.com/2021/07/29/business/economv/hiring-racial-discrimination.html
3https://www.mckinsey.com/featured-insights/diversitv-and-inclusion/women-in-the-workplace
4https://www.morganstanley.com/im/publication/insights/articles/article_culturequantframework_us.pdf, p. 2
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UPS has a unique opportunity to effect positive change in the world through a commitment toitself says: "UPS views diversity, equity and inclusion (DEI). (DEI") as an imperative that enables the Company to attract, develop and retain talented employees, foster innovation, and bring strength and stability to businesses and communities."5
UPS is called on to provide data that allows investors to access how effectively its human capital management systems are meeting the business imperative to provide a diverse, inclusive and equitable workforce.
Response of UPS’s Board
Throughout our history, UPS has transformed from messengers on bicycles to a nationwide package delivery company to a worldwide network of approximately 500,000 UPS employees. We believe in creating an inclusive and equitable environment that represents a broad spectrum of diverse backgrounds and stakeholders. By leveraging diversity with respect to gender, age, ethnicity, skills and other factors, and creating inclusive environments, we believe we can improve organizational effectiveness, cultivate innovation and drive growth.
We work closely with our customers, communities, suppliers and employees to advance a culture that embraces diversity cultivates equity and inclusion, and fosters open participation from those with different ideas and perspectives. UPS views DEI as an imperative that enables the Company to attract and retain talented employees, foster innovation, and bring strength and stability to businesses and communities. Producing an additional special report on UPS’s DEI effortsas requested in the proposal is unnecessary, not an efficient use of resources, and therefore not in the best interests of the Company or its shareowners.

UPS has taken significant steps to develop and maintain a diverse and inclusive workforce

As one of the world’s largest employers, UPS employs people across all cultures, backgrounds, lifestyles and experiences. We provide opportunities for employees to connect, network and learn from others outside of normal work teams and with different backgrounds and experiences. One of the ways we doexperiences to further our goals. We accomplish this is through providing unconscious biasemployee training programs and professionalism training for employees. We also sponsora commitment to employee hubs known as Business Resource Groups (BRGs)(“BRGs”).

The BRG program started as UPS's global BRGs foster a pilotstrong culture of diversity and inclusion at the Company and include nearly 200 chapters in 19 UPS locations in 200634 countries with Women’s Leadership Development (WLD) and has grown into more than 200 chapters worldwide15,000 members. We support BRGs across 11 categories: African American, Asian, Hispanic/Latino, Focus on Abilities, LGBT & Allies, Millennial, Multicultural, Parents & Caregivers, Veterans, Women in Operations, Working Parents, and WLD. Each BRG is supported byWomen’s Leadership Development. All BRGs have executive sponsors and advisors andamong senior management sponsors.

We haveand sponsors among local management who support their strategy and growth. BRG executive sponsors help connect BRGs with people at the highest levels of UPS, so the BRGs can best align their objectives with those of the Company. BRGs at UPS make significant contributions to growing the business, developing our people and supporting the communities we serve.

Our Chief Human Resources Officer also createdserves as the role of Chief Diversity, Equity and InclusionDEI Officer, a position on the company’sCompany’s Executive Leadership Team reporting directly to our CEO. This role is a significant step forward for UPSOur Chief DEI Officer regularly reports directly to build a more inclusive and equitable environment by furthering UPS’s programs and initiatives that infusethe Board of Directors on, among other things, progress towards our goals. The Chief DEI into all aspects of the Company, and tracking and communicating progress toward DEI goals. This roleOfficer also engages with UPS suppliers, customers and other external partners to encourage the adoption of more proactive DEI efforts.

efforts in these areas.

UPS’s commitment to diversity is reflected in our workforce demographics

Our focus on diversity and inclusion is not “corporate puffery” as suggested by this proposal.

Starting from the most senior levels at UPS, our commitment to diversity and inclusion is evident:

Board of Directors – 42% of Directors - 46% of our directors are women; and 31% are non-white
Executive Leadership – 40% of our Executive Leadership Team members are women; and 30% are non-white, after giving effect to announced retirements
Management – as disclosed in our most recent Sustainability Report, 37% of our entry level management positions, and 26% of our senior and middle management positions, are held by women; in addition, 50% of our entry level management positions, and 34% of senior and middle management positions, are held by non-white employees

In addition, our commitment to continued progress for representationdirectors are women and 33% are non-white; 100% of the directors who have joined our board since 2020 are diverse

Executive Leadership Team – 33% of our Executive Leadership Team members are women and 22% are non-white
Management – as disclosed in our most recent GRI Report, while 22% of our workforce is composed of women, globally is shown through38% of our newly developed goal of 28% women representation in full-timeentry level management positions, and 26% of our senior and middle management positions, are held by 2022.

women; in addition, 49% of our entry level management positions, and 38% of senior and middle management positions, are held by non-white employees.

UPS already provides investors with significant diversity and inclusion data

The workforce statistics described above are reported

UPS discloses significant diversity and inclusion information for investors. For example, we annually in our Sustainability Report. In addition, we publicly disclose our consolidated EEO-1 report, that we file with the EEOC, which contains prior year gender, racial and ethnic composition of our US workforce by EEO-1 job category. We also include race and gender information for our board nominees in our Proxy Statement, and publicly disclose progress towards our women and ethnic diversity in management aspirational goals. We provide additional information about our diversity and inclusion efforts in our annual GRI Reports. We believe these disclosures provide our investors with thenecessary and appropriate information needed to determine the effectiveness of our human capital management policies related to workplace diversity.

efforts.

5https://www.sec.gov/ix?doc=/Archives/edgar/data/1090727/000109072723000015/ups-20230320.htm
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UPS has consistently been named a top company for its diversity and inclusion efforts
We further believe the effectiveness and appropriateness of our efforts in this area have been validated through our receipt of numerous awards, including:
UPS was recognized by Forbes in 2023 as one of America’s Best Employers for Veterans;
Carol Tomé was recognized by the Diversity and Leadership Conference as a 2023 Top 50 CEO for Diversity;
UPS was named as One of America’s Greatest Workplaces 2023 For Diversity;
UPS was recognized by Forbes as one of the Best Workplaces for Women;
UPS was named by Black Enterprise to its Best Companies for Diversity, Equity and Inclusion list;
UPS was named by Supply Chain as one of the top 10 companies committed to implementing diversity, equity and inclusion

initiatives in recruitment and partnership;

UPS has received numerous accolades recognizing our DEI efforts, including:

For the sixth year in a row, UPS has been named to Forbes and JUST Capital’s annual JUST 100 corporate leadership list. UPS earned a ranking of No. 45 overall and No. 2 in Transportation
76      Notice of Annual Meeting of Shareowners and 2022 Proxy Statement

was ranked #22 on the 2022 Break the ceiling touch the sky
® 101 Best Global Companies for Women in Leadership Index;

TableUPS was named as one of Contents

Shareowner Proposals

UPS was named to OMNIKAL’s Omni50 Award, which is the top 50 U.S. corporations who are awarding the most business to entrepreneurs from the growing culturally diverse marketplace
UPS was ranked #22 on the 2022 Break the ceiling touch the sky® 101 Best Global Companies for Women in Leadership Index
UPS was named as one of the best places to work for LGBTQ employees, scoring a 100% on the Human Rights Campaign Foundation’s 2022 Corporate Equality Index

the best places to work for LGBTQ employees, scoring a 100% on the Human Rights Campaign Foundation’s 2022 Corporate Equality Index; and

UPS was listed as a 2023 Best Place to Work on Disability: IN’s Disability Equality Index.
The board provides effective, independent oversight of UPS’s human capital management

Our board is responsible, directly and through the Compensation and Human Capital Committee, for oversight of human capital matters, which responsibility it executes through a variety of methods and processes. The board’s oversight of these matters helps identify and mitigate risks and is part of the broader framework that guides how we attract, retain and develop a workforce that aligns with our values and strategies.

matters. Management provides regular updates and leads discussions with the board and its committees around human capital, technology initiatives impacting the workforce, health and safety matters, employee survey results related to culture and other matters, hiring and retention, employee demographics, labor relations and contract negotiations, compensation and benefits, succession planning and employee training initiatives.

In 2021,addition, the board delegatedCompensation and Human Capital Committee charter was recently expanded to include oversight responsibility for oversight of performance and talent management, diversity, equity and inclusion, work culture and employee development and retentionretention. We believe the board’s oversight of these matters helps identify and mitigate exposure to the Compensationlabor and Human Capital Committee. The Committee provides regular updates to the board on these matters. This oversight helps foster the Company’s continued progress and focus on human capital matters.

Producing another reportmanagement risks, and is unnecessary

part of the broader framework that guides how we attract, retain and develop a workforce that aligns with our values and strategies.

We believe our existing diversity and inclusion practices, and significant disclosures, provide meaningful information that allows investors to determine the effectiveness of our human capital management policies related to workplace diversity. Therefore, approval of this proposal would not result in an efficient use of resources and will only serve to benefit the limited interests of a small group of shareowners.

resources.

As a result, the board recommends that shareowners vote AGAINSTthis proposal.

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Important Information About Voting at the 2022 Annual Meeting

What is included in the proxy materials, and why am I receiving them?

Important Information About Voting at the 2024 Annual Meeting
What is included in the proxy materials, and why am I receiving them?
The proxy materials for our Annual Meeting include this Proxy Statement and notice of the 20222024 Annual Meeting, as well as our 20212023 Annual Report. If you received paper copies of these materials, you also received a proxy card or voting instruction form. We began distributing the Proxy Statement, Annual Meeting notice and proxy card, and Notice of Internet Availability of Proxy Materials (the “Notice”) on March 21, 2022.

18, 2024.

When you vote, you appoint each of Carol Tomé and Norman M. Brothers, Jr. to vote your shares at the Annual Meeting as you have instructed them. If a matter that is not on the form of proxy is voted on, then you appoint them to vote your shares in accordance with their best judgment. This allows your shares to be voted whether or not you attend the Annual Meeting.

Why did some shareowners receive a Notice of Internet Availability of Proxy Materials while others received a printed set of proxy materials?

Why did some shareowners receive a Notice of Internet Availability of Proxy Materials while others received a printed set of proxy materials?
We may furnish our proxy materials to requesting shareowners over the Internet, rather than by mailing printed copies, so long as we send them a Notice. The Notice explains how to access and review the Proxy Statement and Annual Report and vote over the Internet at www.proxyvote.com. If you received the Notice and would like to receive printed proxy materials, follow the instructions in the Notice.

If you received printed proxy materials, you won’t receive the Notice, but you may still access our proxy materials and submit your proxy over the Internet at www.proxyvote.com.

Can I receive future proxy materials and annual reports electronically?

Can I receive future proxy materials and annual reports electronically?
Yes. This Proxy Statement and the 20212023 Annual Report are available on our investor relations website at www.investors. ups.com.www.investors.ups.com. Instead of receiving a Notice or paper copies of the proxy materials in the mail, shareowners can elect to receive emails that provide links to our future annual reports and proxy materials on the Internet. Opting to receive your proxy materials electronically will reduce costs and the environmental impact of our annual meetings and will give you an automatic link to the proxy voting site.

If you are a shareowner of record and wish to enroll in the electronic proxy delivery service for future meetings, you may do so by going to www.icsdelivery.com/ups and following the prompts. If you hold class B shares through a bank or broker, please refer to your voting instruction form, the Notice or other information provided by your bank or broker for instructions on how to elect this option.

Who is entitled to vote?

Who is entitled to vote?
Holders of our class A common stock and our class B common stock at the close of business on March 9, 20225, 2024 are entitled to vote. This is the “Record Date.”

You must use your 16-digit control number found on your proxy card, voting instruction form or the Notice of Internet Availability you previously received to participate in the meeting and vote. A list of shareowners entitled to vote at the Annual Meeting will be available in electronic form at www.virtualshareholdermeeting. com/UPS2022 during the Annual Meeting on May 5, 2022. It will also be accessible during regular business hours for ten days prior to the meeting at our principal place of business, 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328.

To how many votes is each share of common stock entitled?

To how many votes is each share of common stock entitled?
Holders of class A common stock are entitled to 10 votes per share. Holders of class B common stock are entitled to one vote per share. On the Record Date, there were 137,663,128125,210,605 shares of our class A common stock and 733,439,141727,925,905 shares of our class B common stock outstanding and entitled to vote.

The voting rights of any shareowner or group of shareowners, other than any of our employee benefit plans, that beneficially owns shares representing more than 25% of our voting power are limited so that the shareowner or group may cast only one one-hundredth of a vote with respect to each vote in excess of 25% of the outstanding voting power.

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Important Information About Voting at the 2022 Annual Meeting

How do I vote before the Annual Meeting?

How do I vote before the Annual Meeting?
Shareowners of record may vote as described below:

Online. You can vote in advance of the Annual Meeting via the Internet at www.proxyvote.com. Internet voting is available 24 hours a day and will be accessible until 11:59 p.m. Eastern Time on May 4, 2022.
By Telephone. If you received a proxy card by mail, the toll-free telephone number is noted on your proxy card. Telephone voting is available 24 hours a day at 1-800-690-6903 and will be accessible until 11:59 p.m. Eastern Time on May 4, 2022.
By Mail. If you received a proxy card by mail and choose to vote in advance by mail, simply mark your proxy card, date and sign it, and return it in the postage-paid envelope.

Online. You can vote in advance of the Annual Meeting via the Internet at www.proxyvote.com. Internet voting is available 24 hours a day and will be accessible until 11:59 p.m. Eastern Time on May 1, 2024.
By Telephone. If you received a proxy card by mail, the toll-free telephone number is noted on your proxy card. Telephone voting is available 24 hours a day at 1-800-690-6903 and will be accessible until 11:59 p.m. Eastern Time on May 1, 2024.
By Mail. If you received a proxy card by mail and choose to vote in advance by mail, simply mark your proxy card, date and sign it, and return it in the postage-paid envelope.
If you hold class A shares in the UPS Stock Fund in the UPS 401(k) Savings Plan, you may vote your shares through the Internet, by telephone, or by mail as if you were a registered shareowner. To allow sufficient time for voting by the Plan trustee, your voting instructions must be received by 11:59 Eastern Time on May 2, 2022.

April 29, 2024.

Even if you plan to attend the Annual Meeting, we encourage you to vote in advance. If you vote through the Internet or by telephone, you do not need to return your proxy card.

The method you use to vote in advance will not limit your right to vote online during the Annual Meeting.

BENEFICIAL SHAREOWNER VOTING OPTIONS

If you are a beneficial owner, you will receive instructions from your bank, broker or other nominee that you must follow in order for your shares to be voted. Many of these institutions offer telephone and Internet voting. If your voting instruction form or Notice indicates that you may vote these shares through www.proxyvote.com, you will need the 16-digit control number indicated on that form or Notice. If you did not receive a 16-digit control number, please contact your bank, broker or other nominee at least five days before the Annual Meeting and obtain a legal proxy to be able to participate in or vote at the Annual Meeting.

BENEFICIAL SHAREOWNER VOTING OPTIONS
If you are a beneficial owner, you will receive instructions from your bank, broker or other nominee that you must follow in order for your shares to be voted. Many of these institutions offer telephone and Internet voting. If your voting instruction form or Notice indicates that you may vote these shares through www.proxyvote.com, you will need the 16-digit control number indicated on that form or Notice. If you did not receive a 16-digit control number, please contact your bank, broker or other nominee at least five days before the Annual Meeting and obtain a legal proxy to be able to participate in or vote at the Annual Meeting.

Can I revoke my proxy or change my vote?

Can I revoke my proxy or change my vote?
Shareowners of record may revoke their proxy or change their vote at any time before the polls close at the Annual Meeting by:

submitting a subsequent proxy through the Internet, by telephone or by mail with a later date;
sending a written notice to our Corporate Secretary at 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328; or
voting online during the Annual Meeting using the 16-digit code.

submitting a subsequent proxy through the Internet, by telephone or by mail with a later date;
sending a written notice to our Corporate Secretary at 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328; or
voting online during the Annual Meeting using the 16-digit code.
If you hold class B shares through a bank or broker, please refer to your proxy card, the Notice or other information forwarded by your bank or broker to see how you can revoke your proxy and change your vote before the Annual Meeting.

Beneficial shareowners that attend the Annual Meeting using the 16-digit code they received as described below will also be able to change their vote by voting online at any time before the polls close at the Annual Meeting.

How many votes do you need to hold the Annual Meeting?

How many votes do you need to hold the Annual Meeting?
The presence, online or by proxy, of the holders of a majority of the votes entitled to be cast at the Annual Meeting will constitute a quorum. A quorum is necessary to hold the Annual Meeting and conduct business. If a quorum is not present, online, the Annual Meeting may be adjourned from time to time until a quorum is present.

What happens if I do not provide voting instructions or if a nominee is unable to stand for election?

What happens if I do not provide voting instructions or if a nominee is unable to stand for election?
If you sign and return a proxy but do not provide voting instructions, your shares will be voted as recommended by the board.

If a director nominee is unable to stand for election, the board may either reduce the number of directors that serve on the board or designate a substitute nominee. If the board designates a substitute nominee, shares represented by proxies voted for the nominee who is unable to stand for election will be voted for the substitute nominee.

Will my shares be voted if I do not vote through the Internet, by telephone or by signing and returning my proxy card?

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Will my shares be voted if I do not vote through the Internet, by telephone or by signing and returning my proxy card?
If you are a shareowner of record and you do not vote, then your shares will not count in deciding the matters presented for shareowner consideration at the Annual Meeting.

If your class A shares are held in the UPS Stock Fund in the UPS 401(k) Savings Plan and you do not vote by 11:59 p.m. Eastern Time on May 2, 2022,April 29, 2024, then the Plan trustee will vote your shares

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for each proposal in the same proportion as the shares held underby the Plan for which voting instructions were received.

If your class B shares are held in street name through a bank or broker, your bank or broker must vote according to specific instructions they receive from you. If brokers do not receive specific instructions, brokers may in some cases vote the shares in their discretion. But they are not permitted to vote on certain proposals and may elect not to vote on any of the proposals without your class B shares under certain limited circumstances ifvoting instructions. If you do not provide voting instructions beforeand the Annual Meeting. These circumstances include voting your shares on “routine matters” as defined by NYSE rules relatedbroker elects to voting by banks and brokers, such as the ratification of the appointment of our independent registered public accounting firm described in this Proxy Statement. With respect to this proposal, therefore, if you do not vote your shares, your bank or broker may vote your shares on your behalf or leave your shares unvoted.

The remaining proposals aresome but not considered “routine matters” under NYSE rules relating to voting by banks and brokers. Whenall matters, it will result in a proposal is not a routine matter and"broker non-vote" for the brokerage firm has not receivedmatters on which the broker votes. Abstentions occur when you provide voting instructions but instruct the brokerage firm cannot vote the sharesbroker to abstain from voting on that proposal. Shares that banks and brokerage firms are not authorized to vote are called “broker non-votes.”a particular matter. Broker non-votes that are represented at the Annual Meeting will be counted for purposes of establishing a quorum but not for determining the number of shares voted for or against a non-routine matter.

quorum. We encourage you to provide instructions to your bank or brokerage firm by voting your proxy so that your shares will be voted at the Annual Meeting in accordance with your wishes.

What is the vote required for each proposal to pass, and what is the effect of abstentions and uninstructed shares on each of the proposals?

What is the vote required for each proposal to pass, and what is the effect of abstentions and broker non-votes on each of the proposals?
Our Bylaws provide for majority voting in uncontested director elections. Therefore, a nominee will only be elected if the number of votes cast for the nominee’s election is greater than the number of votes cast against that nominee. See “Corporate Governance – Majority Voting and Director Resignation Policy” for an explanation of what would happen if more votes are cast against a nominee than for the nominee. Abstentions are not considered votes cast for or against the nominee. For each other proposal to pass, in accordance with our Bylaws, the proposal must receive the affirmative vote of a majority of the voting power of the shares present in person or by proxy at the Annual Meeting and entitled to vote.

vote on such proposal.

The following table summarizes the votes required for each proposal to pass and the effect of abstentions and uninstructed sharesbroker non-votes on each proposal.

Proposal
Number
ItemItemVotes
Vote Required for
Approval
AbstentionsAbstentions
Uninstructed
shares
1.Election of 1312 directorsMajority of votes castNo effectNo effect
2.Advisory vote on executiveto approve NEO compensationMajority of the voting power of the shares represented at the meeting and entitled to vote on the proposalSame as votesa vote againstNo effect
3.Ratification of independent registered public accounting firmMajority of the voting power of the shares represented at the meeting and entitled to vote on the proposalSame as votesa vote againstDiscretionary voting by broker permittedNo effect
4. - 9.6.Shareowner proposalsMajority of the voting power of the shares represented at the meeting and entitled to vote on the proposalSame as votesa vote againstNo effect

How do I attend and vote at the Annual Meeting?

How do I attend and vote at the Annual Meeting?
The Annual Meeting will take place on May 5, 2022,2, 2024, at 8:00 a.m. Eastern Time. There will not be a physical location for the Annual Meeting, and you will not be able to attend in person. You or your proxyholder can participate vote and examine our list of shareowners entitled to vote at the Annual Meeting by visiting www.virtualshareholdermeeting.com/UPS2022UPS2024 and entering the 16-digit control number included in your Notice, on your proxy card, or on the instructions that accompanied your proxy materials. If you are a beneficial shareowner, see the information relating to beneficial shareowners above under “How do I vote before the Annual Meeting” for obtaining your 16-digit control number. You may begin to log into the meeting platform at 7:45 a.m. Eastern Time on Thursday, May 5, 2022.

How can I submit a question at or prior to the Annual Meeting?

2, 2024.

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How can I submit a question at or prior to the Annual Meeting?
If you wish to submit a question prior to the Annual Meeting, you may do so by visiting proxyvote.com and entering your 16-digit control number, then clicking “Submit a Question for Management.”

We have designed the format of the Annual Meeting so that shareowners will have the same rights and opportunities as they would have had at a physical meeting. To this end, shareowners will be able to submit questions during the Annual Meeting. If you wish to submit a question during the Annual Meeting, you may do so by logging into www.virtualshareholdermeeting.com/UPS2022UPS2024 with your 16-digit control number, as described above under “How do I attend and vote at the Annual Meeting?” We will answer questions and address comments relevant to meeting matters that comply with the meeting rules of conduct during the Annual Meeting, subject to time constraints. We will summarize multiple questions submitted on the same topic. We will make every effort to respond to all appropriate questions during the meeting, as time permits.

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Important Information About Voting at the 2022 Annual Meeting

If there are matters of individual concern to a shareowner and not of general concern to all shareowners, or if a question posed was not otherwise answered, we provide an opportunity for shareowners to contact us separately after the Annual Meeting at www.investors.ups.com.

What if I have technical difficulties or trouble accessing the virtual Annual Meeting?

What if I have technical difficulties or trouble accessing the virtual Annual Meeting?
For help with technical difficulties on the meeting day you can call 1-800-586-1548 (toll free) or 303-562-9288 (international) for assistance. Technical support will be available starting at 7:00 a.m. Eastern Time and until the meeting has finished.

What does it mean if I receive more than one Notice, proxy card or voting instruction form?

What does it mean if I receive more than one Notice, proxy card or voting instruction form?
This means that your shares are registered in different names or are held in more than one account. To ensure that all shares are voted, please vote each account by using one of the voting methods as described above.

When and where will I be able to find the voting results?

When and where will I be able to find the voting results?
You can find the official results of the voting at the Annual Meeting in our Current Report on Form 8-K that we will file with the SEC within four business days after the Annual Meeting. If the official results are not available at that time, we will provide preliminary voting results in the Form 8-K and will provide the final results in an amendment as soon as they become available.

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Other Information for Shareowners

Other Information for Shareowners
Solicitation of Proxies

We will pay our costs of soliciting proxies. Directors, officers and other employees, acting without special compensation, may solicit proxies by mail, email, in person or by telephone. We will reimburse brokers, fiduciaries, custodians and other nominees for out-of-pocket expenses incurred in sending our proxy materials and Notice to, and obtaining voting instructions relating to the proxy materials and Notice from, shareowners. In addition, we have retained Georgeson, Inc. to assist in the solicitation of proxies for the Annual Meeting at a fee of approximately $16,000 plus associated costs and expenses.

Eliminating Duplicative Proxy Materials

We have adopted a procedure approved by the SEC called “householding” under which multiple shareowners who share the same last name and address and do not participate in electronic delivery will receive only one copy of the annual proxy materials or Notice unless we receive contrary instructions from one or more of the shareowners. If you wish to opt out of householding and continue to receive multiple copies of the proxy materials or Notice at the same address, or if you have previously opted out and wish to participate in householding, you may do so by notifying us in writing or by telephone at: UPS Investor Relations, 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328, (404) 828-6059, and we will promptly deliver the requested materials. You also may request additional copies of the proxy materials or Notice by notifying us in writing or by telephone at the same address or telephone number.

Submission of Shareowner Proposals and Director Nominations

Proposals for Inclusion in the Proxy Statement for the 2023 Annual Meeting

Proposals for Inclusion in the Proxy Statement for the 2025 Annual Meeting
Shareowners who, in accordance with Rule 14a-8 under the Securities Exchange Act of 1934, wish to present proposals for inclusion in the proxy materials to be distributed in connection with the 20232025 Annual Meeting of Shareowners must submit their proposals so that they are received by our Corporate Secretary at 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328, or via email to investor@ups.com, no later than 6:00 p.m. Eastern Time on November 21, 2022.18, 2024. Any proposal will need to comply with SEC regulations regarding the inclusion of shareowner proposals in Company-sponsored proxy material. As the rules of the SEC make clear, simply submitting a proposal does not guarantee its inclusion.

Director Nominations for Inclusion in the Proxy Statement for the 2023 Annual Meeting

Director Nominations for Inclusion in the Proxy Statement for the 2025 Annual Meeting
Shareowner notice of the intent to use proxy access must be delivered to the Corporate Secretary at 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328 not later than the close of business on the 120th day, nor earlier than the 6:00 p.m. Eastern Time on the 150th day, prior to the first anniversary of the date the definitive proxy statement was first released to shareowners in connection with the preceding year’s annual meeting of shareowners; provided, however, that in the event the annual meeting is more than 30 days before or after the anniversary of the preceding year’s annual meeting, or if no annual meeting was held in the preceding year, to be timely, the notice must be so delivered not earlier than the close of business on the 150th day prior to such annual meeting, and not later than the close of business on the later of the 120th day prior to such annual meeting, or the 10th day following the day on which public announcement of the date of such meeting is first made by the Company. Therefore, any notice of the intent to use proxy access must be delivered to our Corporate Secretary no later than 6:00 p.m. Eastern Time on November 21, 202218, 2024 and no earlier than 6:00 p.m. Eastern Time on October 22, 2022.19, 2024. However, if the date of our 20232025 Annual Meeting occurs more than 30 days before or 30 days after May 5, 2023,2, 2025, the anniversary of the 20222024 Annual Meeting, a shareowner notice will be timely if it is delivered to our Corporate Secretary by the later of (a) the close of business on the 120th day prior
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to the date of the 20232025 Annual Meeting and (b) the 10th day following the day on which we first make a public announcement of the date of the 20232025 Annual Meeting. As our Bylaws make clear, simply submitting a nomination does not guarantee its inclusion.

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Other Proposals or Director Nominations for Presentation at the 2025 Annual Meeting of Shareowners and 2022 Proxy Statement

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Other Information for Shareowners

Other Proposals or Director Nominations for Presentation at the 2023 Annual Meeting

Shareowners who wish to propose business or nominate persons for election to the Board of Directors at the 20232025 Annual Meeting of Shareowners, and the proposal or nomination is not intended to be included in our 20232025 proxy materials,statement, must provide a notice of shareowner business or nomination in accordance with Article II, Section 10 of our Bylaws.Bylaws (which includes information required under Rule 14a-19 under the Securities Exchange Act of 1934). In order to be properly brought before the 20232025 Annual Meeting of Shareowners, Article II, Section 10 of our Bylaws requires that a notice of a matter the shareowner wishes to present (other than a matter brought pursuant to Rule 14a-8), or the person or persons the shareowner wishes to nominate as a director (other than through proxy access), must be received by our Corporate Secretary not later than the close of business on the 90th day, nor earlier than the close of business on the 150th day, prior to the first anniversary of the preceding year’s annual meeting. Therefore, any notice intended to be given for a proposal or nomination not intended to be included in our 20232025 proxy materials must be received by our Corporate Secretary at 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328 no later than 6:00 p.m. Eastern Time on February 4, 2023,1, 2025, and no earlier than the close of business6:00 p.m. Eastern Time on December 6, 2022.3, 2024. However, if the date of our 20232025 Annual Meeting occurs more than 30 days before or 30 days after May 5, 2023,2, 2025, the anniversary of the 20222024 Annual Meeting, a shareowner notice will be timely if it is delivered to our Corporate Secretary by the later of (a) the close of business on the 90th day prior to the date of the 20232025 Annual Meeting and (b) the 10th day following the day on which we first make a public announcement of the date of the 20232025 Annual Meeting.

To be in proper form, a shareowner’s notice must be a proper subject for shareowner action at the Annual Meeting and must include the specified information concerning the proposal or nominee as described in Article II, Section 10 of our Bylaws. Our Bylaws are available on the governance page of our investor relations website at www.investors.ups.com. In addition, a shareowner who intends to solicit proxies pursuant to Rule 14a-19 in support of nominees submitted under these advance notice provisions of the Bylaws must provide notice to the Secretary of the Company regarding such intent no later than March 6, 2023.

2021

2023 Annual Report on Form 10-K

A copy of our 20212023 Annual Report on Form 10-K, including financial statements, as filed with the SEC may be obtained without charge upon written request to: Corporate Secretary, 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328. It is also available on our investor relations website at www.investors.ups.com.

Other Business

Our Board of Directors is not aware of any business to be conducted at the Annual Meeting other than the proposals described in this Proxy Statement. Should any other matter requiring a vote of the shareowners arise, the persons named in the accompanying proxy card will vote in accordance with their best judgment. A proxy granted by a shareowner in connection with the Annual Meeting will give discretionary authority to the named proxy holders to vote on any such matters that are properly presented at the Annual Meeting, subject to SEC rules.

This proxy statementProxy Statement contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than those of current or historical fact, and all statements accompanied by terms such as “will,” “believe,” “project,” “expect,” “estimate,” “assume,” “intend,” “anticipate,” “target,” “plan” and similar terms, are intended to be forward-looking statements. Forward-looking statements are made subject to the safe harbor provisions of the federal securities laws pursuant to Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements relate to our intent, belief and current expectations about our strategic direction, prospects and future results, and give our current expectations or forecasts of future events; they do not relate strictly to historical or current facts.

Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations or anticipated results. These risks and uncertainties include, but are not limited to, those described in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021,2023, filed with the SEC and being made available with
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this proxy statement,Proxy Statement, and may also be described from time to time in our future reports filed with the SEC. You should consider the limitations on, and risks associated with, forward-looking statements and not unduly rely on the accuracy of predictions contained in such forward-looking statements. Management believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We do not undertake any obligation to update forward-looking statements to reflect events, circumstances, changes in expectations or the occurrence of unanticipated events after the date of those statements.

Any standards of measurement and performance made in reference to our environmental, social, governance and other sustainability plans and goals are developing and based on assumptions, and no assurance can be given that any such plan, initiative, projection, goal, commitment, expectation, or prospect can or will be achieved.
Website links included in this Proxy Statement are for convenience only. The content of any website links is not incorporated herein and does not constitute a part of this Proxy Statement.

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ANNUAL MEETING OF SHAREOWNERS

Thursday, May 5, 2022, 8:00 a.m. Eastern Time

www.virtualshareholdermeeting.com/UPS2022



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UNITED PARCEL SERVICE, INC.
INVESTOR RELATIONS B1F7
55 GLENLAKE PARKWAY, N.E.
ATLANTA, GA 30328

VOTE BY INTERNET

Before The Meeting - Go to www.proxyvote.com or scan the QR Barcode above

Use the Internet to transmit your voting instructions and for electronic delivery of information. Vote by 11:59 P.M. Eastern Time on May 4, 2022. Shares held in the UPS Stock Fund in the UPS 401(k) Savings Plan must be voted by 11:59 P.M. Eastern Time on May 2, 2022. 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.

During The Meeting - Go to www.virtualshareholdermeeting.com/UPS2022

You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions.

VOTE BY PHONE - 1-800-690-6903

Use any touch-tone telephone to transmit your voting instructions. Vote by 11:59 P.M. Eastern Time on May 4, 2022. Shares held in the UPS Stock Fund in the UPS 401(k) Savings Plan must be voted by 11:59 P.M. Eastern Time on May 2, 2022. Have your proxy card in hand when you call and follow the instructions.

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.

If you vote by Internet or phone, you do not need to return this card.

TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK:

D71215-P70092-Z82103KEEP THIS PORTION FOR YOUR RECORDS
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.DETACH AND RETURN THIS PORTION ONLY

UNITED PARCEL SERVICE, INC.
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The board of directors recommends you vote FOR all 13 director nominees.
1.To elect 13 directors nominated by the board of directors to serve until the 2023 annual meeting of shareowners or their earlier resignation, removal or retirement.
Nominees:ForAgainstAbstain
1a)Carol B. Toméooo
1b)  Rodney C. Adkinsooo
1c)Eva C. Borattoooo
1d)Michael J. Burnsooo
1e)Wayne M. Hewettooo
1f)Angela Hwangooo
1g)Kate E. Johnsonooo
1h)William R. Johnsonooo
1i)Ann M. Livermoreooo
1j)Franck J. Moisonooo
1k)Christiana Smith Shiooo
1l)Russell Stokesooo
1m)Kevin Warshooo
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The board of directors recommends you vote FOR the following proposals:ForAgainstAbstain
2.To approve on an advisory basis named executive officer compensation.ooo
3.To ratify the appointment of Deloitte & Touche LLP as UPS’s independent registered public accounting firm for the year ending December 31, 2022.ooo
The board of directors recommends you vote AGAINST the following proposals:
4.To prepare an annual report on lobbying activities.ooo
5.To prepare a report on alignment of lobbying activities with the Paris Climate Agreement.ooo
6.To reduce the voting power of UPS class A stock from 10 votes per share to one vote per share.ooo
7.To require adoption of independently verified science-based greenhouse gas emissions reduction targets.ooo
8.To prepare a report on balancing climate measures and financial returns.ooo
9.To prepare an annual report assessing UPS’s diversity and inclusion.ooo
In their discretion upon such other matters as may properly come before the meeting or any adjournments or postponements thereof.


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.
Signature [PLEASE SIGN WITHIN BOX]    Date
Signature (Joint Owners)                     Date




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Annual Meeting of Shareowners
Thursday, May 5, 2022, 8:00 a.m. Eastern Time
The meeting will be held online at:
www.virtualshareholdermeeting.com/UPS2022

You or your proxyholder can participate, vote and examine a list of shareowners at the
Virtual Annual Meeting by entering your unique control number.

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Notice and Proxy Statement and Annual Report are available at www.proxyvote.com.

D71216-P70092-Z82103

UNITED PARCEL SERVICE, INC.
This proxy is solicited by the Board of Directors
for the Annual Meeting of Shareowners to be held on May 5, 2022

I hereby appoint CAROL B. TOMÉ and NORMAN M. BROTHERS, JR., or either of them, with power of substitution, as attorneys and proxies to vote all of the shares of stock outstanding in my name as of March 9, 2022, at the Annual Meeting of Shareowners of United Parcel Service, Inc. to be held online at www.virtualshareholdermeeting.com/UPS2022 on May 5, 2022, and at any or all adjournments or postponements thereof, as stated on the reverse side and with discretionary authority on all other matters that properly come before the meeting. If this proxy is signed and returned but no direction is made, this proxy will be voted as the Board of Directors recommends and in the discretion of the proxies on all other matters that may properly come before the meeting.

If my shares are held in the UPS Stock Fund in the UPS 401(k) Savings Plan, I direct the Trustee to vote the stock in the manner stated on the reverse side. If this proxy is signed and returned but no direction is made, the Trustee will vote the shares as the Board of Directors recommends and in the discretion of the Trustee on all other matters that may properly come before the meeting. If this card is not returned by 11:59 P.M. Eastern Time on May 2, 2022 or is returned unsigned, then the Trustee will vote the shares in the same proportion as the shares for which voting instructions are received from other participants. The results of the voting will be held in strict confidence by the Trustee.

(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE)

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