UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
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GENERAL MOTORS COMPANY
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WHO WE ARE AND WHY WE ARE HERE...
We are committed to safety in everything we do. We earncustomers Customers for life.
We build brands thatinspirepassion and loyalty.
We translatebreakthroughtechnologies into vehicles and experiences that people love.
Weserveand create sustainable solutions that improve the communities in which we live and work.
We are building theThe Long-Term View:most valuedautomotive company.
A Conversation with Mary Barra, Tim Solso, and Pat Russo
Letter FromGeneral Motors’ Chairman and CEO, Mary Barra, Independent Lead Director, Tim Solso, and Governance and Corporate Responsibility (“Governance”) Committee Chair, Pat Russo, discuss the Chairman & Chief Executive Officer
Dear Fellow Shareholder:
I am pleasedBoard’s approach to invite you to attend our 2016 Annual Meetingdriving long-term shareholder value and the importance of Shareholders.
Key to Our Success
The key to our success is placing the customer at the center of everything we do, from safety and quality to design and connectivity. We strive to earn customers for life with brands that inspire passion and loyalty and with breakthrough technologies and experiences that people love. By satisfying our current customers and winning new ones on the strength of our latest cars, trucks and crossovers, we achieved solid financial results in 2015. This strong performance enabled us to reinvest in our business, including in the technology and advanced mobility solutions our customers expect and demand. Importantly, itmeaningful shareholder engagement. They also enabled us to increase shareholder returns through dividends and our expanded share repurchase program.
Strategic Plan
Our strategic plan, endorsed by the Board of Directors, is to continue strengthening our core business and to take advantage of this strength to define and lead the future of personal mobility. Around the world, social and technological changes are rapidly transforming personal transportation. I believe the automotive industry will change more in the next five years than it has in the previous 50 years. We’re excited by this kind of disruption and are working to lead it. To this end, we are leveraging our 1.2 billion OnStar customer interactions, we are leading the industry in 4G LTE connectivity, we launched Maven, our unified car-sharing program, we announced a strategic alliance with Lyft Inc., the fastest-growing ridesharing company in the U.S., and we have announced our intent to acquire Cruise Automation, Inc., a leader in autonomous technology. Later this year, we will launch the groundbreaking, all-electric Chevrolet Bolt EV, featured on the front cover of this Proxy Statement, and next year we will introduce “Super Cruise” hands-free highway driving automation technology in the 2017 Cadillac CT6.
Board Alignment
Our Board and leadership team are confident that our strategic plan will enable us to lead in the transformation of personal mobility. The Board fully supports our focus on optimizing long-term financial returns for our shareholders by increasing profitability in our core business, taking advantage of growth opportunities and driving innovation through this period of disruption and change.
Theexplain why GM’s Board has the right mix of relevant expertise, talent, and experiencediversity to actively oversee and guide the leadership team as we execute our strategic plan. The Board’s diversity and independence foster the wide range of thought and perspective that is critical to the Company’s success. Establishing a best-in-class governance and compensation environment is a priority for the Board. We’ve highlighted our key accomplishments in governance for 2015 in the pages that follow.
Shareholder Outreach
Over the past year, I have met with many of you through our expanded investor engagement program, which has enabled the GM leadership team and Board to meet and solicit feedback and share information with shareholders. Both GM and the Board benefit greatly from the insights, experiences and ideas exchanged during these engagements, and I look forward to continuing them in the year ahead.
Thank you for your support and interest in GM.
Sincerely,
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Letter From the Independent Lead Director
Dear Fellow Shareholder:
General Motors Company is committed to sound corporate governance policies and practices that are designed and routinely assessed to enable the Company to operate its business responsibly, with integrity, and in the best interests of its shareholders. I want to take this opportunity to highlight the significant governance developments at GM over 2015 and early 2016. They are also described in more detail in this Proxy Statement.
Board Leadership Structure
On January 4, 2016, our Board recombined the positions of Chairman and CEO under the leadership of Mary T. Barra and designated me as the Board’s Independent Lead Director. The Board concluded that it was in the best interests of the Company and its shareholders to combine the roles of Chairman and CEO at this time to drive the most efficient execution of our strategic plan and realize our vision for the future. At the same time, our Board strengthened the responsibilities of the Lead Director role, which are describedGM’s strategy in GM’s Corporate Governance Guidelines and in this Proxy Statement, to include additional duties that further promote independent, objective oversight by the non-employee directors. With these changes, the Board has adopted the right governance structure, with the right leaders and oversight, to drive shareholder value now and in the future.
Board Refreshment
The Board continues to recruit new directors to bring fresh perspectives and new ideas into the GM Boardroom. In 2015, we added two new directors: Linda R. Gooden, retired Executive Vice President, Information Systems & Global Solutions, Lockheed Martin Corporation, and Joseph Jimenez, CEO, Novartis AG. This year, we are pleased to announce the nomination of Jane L. Mendillo for election to the Board. Jane is the retired President and CEO of Harvard Management Company and brings a seasoned finance perspective and extensive investment management experience to our Board.
Shareholder Engagement and Proxy Access
To strengthen our commitment to receiving investor feedback, the Board has adopted a Director-Shareholder Engagement Policy that promotes proactive and productive engagement between directors and shareholders. Over the course of 2015 and through 2016, members of our Board have had and will continue to have direct conversations with investors on matters that are important to them, as well as matters on which GM wishes to share information or seek input.
In mid-2015, our Board began considering whether it would be appropriate to proactively adopt proxy access to provide our shareholders greater ability to have their voices heard through nomination of director candidates. Our process included a review of best practices, trends among other large public companies adopting proxy access and an extensive engagement process with shareholders. Reflective of our commitment to an active engagement process, the Board considered feedback from our shareholders and tailored certain aspects of the Company’s proxy access bylaw, which was adopted recently, based on that feedback.
Board Oversight
Board and Committee meetings regularly devote substantial time to GM’s strategic priorities, focusing on assessing the Company’s progress to date, as well as on strategic initiatives and risks over the short and long term. The Board believes that although short-term performance is important, it should be assessed in the context of the Company’s long-term goals.
As Lead Director, it is my privilege to work alongside engaged Board members who bring exceptional knowledge, perspective and commitment into the GM Boardroom. The robust debate around strategic priorities and initiatives that takes place at every Board meeting is evidence of the Board’s proactive oversight and guidance of management through this time of rapid industry change.
On behalf of the entire Board, thank you for your continued support.
Sincerely,
Chairman & CEO | THEODORE M. Independent Lead Director | |
PATRICIA F. RUSSO Governance Committee Chair |
How do you validate whether you are doing the right things for shareholders? Delivering value now and building for the future?
MARY:We have shared our strategy to transform GM, which is about driving excellence in our core business, while defining a future for mobility. We believe the best way to validate whether our approach is creating shareholder value is to deliver exceptional business results today while investing to lead in the future. By refocusing our finite resources during the past several years – including actions to either improve or exit underperforming businesses and to invest our capital in higher-return opportunities – we have achieved results that speak for themselves: three consecutive years of record financial performance. We have also made significant investments in technology and innovation that have positioned GM as a leader in the future of personal mobility. This view is shared by third parties like Navigant Research, which ranked GM as the leader in autonomous vehicle technology, ahead of 18 technology and automotive competitors.
What’s next? What steps are you taking to increase shareholder value?
MARY: We are a focused, more disciplined company. We will continue to transform our core business, invest in key technologies that are enabling us to lead in the future of personal mobility, and deploy capital to higher-return opportunities. In 2017, GM announced its vision for a world with zero crashes, zero emissions, and zero congestion. We are developing the technologies that will create this future, blending global insights with local market expertise as the automotive industry transforms from traditional manufacturing to transportation services.
The strong foundation and the increased flexibility we have created will enable us to take further actions – operational, financial, and technological – that we believe will deliver increased value for our shareholders.
The automobile industry is undergoing a period of profound change. How does the Board position GM to emerge as a leader?
TIM:The industry is changing quickly. Staying ahead means you have to be open to new ideas and invite input that challenges you with different thinking and perspectives. Our shareholder engagement process is an effective channel for the Board to hear these perspectives. Directors frequently meet with shareholders and can then bring shareholder views into the boardroom. During 2017, members of the Board met in person with shareholders representing approximately 25% of our outstanding common stock. We also invite large, long-term investors in GM and sell-side research analysts to meet with the full Board to share their unfiltered views on an annual basis.
Shareholder engagement is invaluable because it gives us a first-hand perspective on what is important to our shareholders as we make strategic, financial, and operational decisions. Using this approach, the Board has worked closely with management in recent years as it executed a number of key strategic actions to transform our core business and lead in the future of personal mobility. These included the decision to exit unprofitable markets, such as Europe and South and East Africa, in favor of higher-return opportunities that include growing the Cruise Automation team and acquiring LiDAR provider Strobe, Inc. to accelerate GM’s leadership in self-driving vehicle technology.
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How do you assure that the Board and management are aware of what’s on the horizon?
TIM:GM’s Board and leadership team are focused on new technologies and other emerging trends in the automotive industry. Management collaborates with internal and external experts across disciplines, from technology, cybersecurity, and design to regulatory and public policy, to assess opportunities and develop strategy. The Board is deeply engaged with management in these efforts. We also make it a priority to visit our global operations. Last April, we were in China, and this year, we visited our global propulsion headquarters and our research and development center and laboratories.
As you execute your plan, what are the elements that you believe are creating value?
MARY:We have been executing a plan that has accelerated GM’s transformation and driven accountability across our operations. Specifically, we have launched dozens of award-winning vehicles around the world; invested in key technologies to unlock our vision of zero crashes, zero emissions, and zero congestion; exited unprofitable markets; streamlined our operations with a relentless focus on cost; enhanced our capital structure; and strengthened our financing arm for competitive advantage.
Our record results over the last three years reflect the magnitude of change we have initiated and our dedication to meeting our financial commitments. And through dividends and stock repurchases, we have returned more than $25 billion to our shareholders from 2012 through the end of 2017. We also outperformed our peers in Total Shareholder Return in 2017.
Why do you believe the current Board is the right one to deliver increased value for GM shareholders?
PAT:We believe the current Board is composed of the right people to guide us through this important period of industry change and opportunity. Our strategic plan is multidisciplinary and so is your Board. Our directors are all outstanding leaders – most with experience managing large, highly complex, global organizations – who effectively oversee the performance of our core business as well as the execution of management’s strategy to lead in the future of personal mobility. We have members who understand evolving issues like technology, public policy, and international trade that are having a direct and increasingly important impact on our business. We also have directors with deep finance and capital markets expertise to provide guidance on optimal capital structure and effective capital allocation. With this expertise, your Board helps GM appropriately balance long-term investment with return of value to shareholders in the near term and navigate current and future risks.
Can you provide insight for shareholders on what the Board looks for in a new director?
PAT: We find potential candidates from a variety of sources, including search firms and shareholders as well as recommendations from directors and management, and we take adding a new director to your Boardseriously.Strategy-minded director recruitment and succession planning is critical to ensuring that your Board continues to protect shareholder value and be a strategic asset for the Company that is capable of addressing the evolving risks, trends, and opportunities that are around the corner at GM. We have a well-established process for director selection that is directly linked to the strategic needs of our business. The Governance Committee uses a carefully constructed skills matrix to review the experiences, qualifications, and attributes of current Board members and prospective candidates against the strategic needs of GM going forward to determine who can best help GM continue its momentum. Your Board also recognizes that refreshment brings both increased diversity and new perspectives, which are important components of a high-quality board. In fact, we added four new directors in the past three years as part of this comprehensive refreshment and recruitment process, including Devin N. Wenig, President and Chief Executive Officer of eBay Inc. (“eBay”), who brings considerable technology and consumer-facing experience to your Board.
Since 2016, Mary has been both the Chairman and CEO. With the two roles now combined, is the Board’s voice truly independent? Is the current Board leadership structure in the best interests of shareholders?
TIM:Your Board holds management accountable. Ten of the Board’s eleven directors are independent and together they have the right mix of expertise to oversee, guide, and challenge the leadership team. We are shaping and overseeing the Company’s strategy. Strategy is a part of every Board meeting agenda, and every year the Board holds a multiday session devoted exclusively to GM’s strategic plan. During these discussions, Board members engage in active debate and dialogue, challenge and validate management’s assumptions, and shape various aspects of management’s strategy and execution.
The Board does not believe there is a one-size-fits-all solution for board leadership structure or that combining or separating the Chairman and CEO roles is quite the black-and-white issue it is sometimes made out to be. Mary is the right person to lead your Board. GM’s performance under her leadership demonstrates that this structure is the most efficient way to execute our strategic plan and create value for shareholders. It is important for shareholders to realize that the Board retains the flexibility to separate the positions at any time if circumstances change. On an annual basis, the Board carefully considers the appropriate leadership structure for GM and its shareholders and determines whether to combine or split these roles. In the past, the Board has decided that separating the roles of Chairman and CEO would best serve shareholders, and in the future we may again, but we are confident that combining the roles is in the best interests of shareholders right now.
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Notice of 2016
2018 Annual Meeting of Shareholders
April 22, 2016
April 27, 2018
Dear Fellow Shareholder:
You are cordially invitedThe Board of Directors of General Motors Company (“General Motors,” “GM,” the “Company,” “we,” and “our”) invites you to attend the 2018 Annual Meeting of Shareholders of(the “Annual Meeting”) to be held on June 12, 2018, at the General Motors Company.Global Headquarters, 300 Renaissance Center, Detroit, Michigan 48265. At the meetingAnnual Meeting, you will be asked to:
u | Elect the 11 Board-recommended director nominees named in this Proxy Statement; |
u | Approve, on an advisory basis, Named Executive Officer (“NEO”) compensation; |
u | Ratify the selection of |
Vote on |
Transact any other business that is properly |
Record Date
You are entitled to vote at the meeting ifIf you were a holder of record of GM common stock at the close of business on April 8, 2016.
Attending16, 2018, you are entitled to vote at the Annual Meeting
If you planMeeting. A list of registered shareholders will be available for examination for any purpose that is germane to attendthe meeting at GM’s Global Headquarters in Detroit, Michigan, for 10 business days before the Annual Meeting please followbetween 9:00 a.m. and 5:00 p.m. Eastern time, and also during the instructions on page 73Annual Meeting.
This Proxy Statement is provided in conjunction with GM’s solicitation of proxies to be used at the Annual Meeting. In addition to this Proxy Statement.
Webcast
OurStatement and proxy card or voting instruction form, the GM 2017 Annual Meeting will be audio webcastReport on June 7, 2016 and may be accessed atwww.gm.com/gmannualmeeting. Additional information regardingForm10-K is provided in this package or is available on the audio webcast may be found on page 73.
Internet.
Thank you for your interest in GM.
General Motors Company.
By Order of the Board of Directors,
Rick E. Hansen
Assistant General Counsel and Corporate Secretary,
General Motors Company
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Date: June 12, 2018 Time:9:30 a.m. Eastern Time | ||||||
Place: | General Motors Global Headquarters 300 Renaissance Center Detroit, Michigan 48265 | |||||
Your vote is important. | ||||||
Your vote is important.So that your shares will be represented and voted at the meeting, please submit your vote as soon as possible by one of the following methods:
Please promptly submit your vote by Internet, by telephone, or by signing, dating, and returning the | ||
We are first mailing these proxy materials to our shareholders on or about April 27, 2018. |
We are first furnishing these proxy materials to our shareholders on or about April 22, 2016.
How You Can Access the Proxy Materials | ||||||
Important Notice Regarding the Availability of Proxy Materials for the
Our Proxy Statement and 2017 Annual Report |
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B-1 |
Proxy Statement SummaryPROXY STATEMENT SUMMARY
This summary highlights information contained elsewhere in this Proxy Statement. It does not contain all of the information that you should consider. Please read the entire Proxy Statement carefully before voting.
Agenda and Voting Recommendations
Proposal | Board Vote Recommendation | Page Reference | ||||
MANAGEMENT PROPOSALS: | ||||||
Item No. 1– Election of Directors | FOR | 7 | ||||
Item No. 2– Approval of, on an Advisory Basis, | FOR | 68 | ||||
Item No. 3– Ratification of the Selection of | FOR | 69 | ||||
SHAREHOLDER PROPOSALS: | ||||||
Item No. 4– Independent Board Chairman | AGAINST | 72 | ||||
Item No. 5– Shareholder Right to Act by Written Consent | AGAINST | 74 | ||||
Item No. 6– Report on Greenhouse Gas Emissions and CAFE Standards | AGAINST | 76 |
Composition of Board Nominees
WE HAVE THE RIGHT BOARD AT THE RIGHT TIME FOR GM The Board and management are overseeing a period of unprecedented change at GM. Ensuring the Board is composed of directors who bring diverse viewpoints and perspectives, exhibit a variety of skills, professional experience, and backgrounds, and effectively represent the long-term interests of shareholders is a top priority of your Board and the Governance Committee. Our membership criteria and director recruitment initiatives align the Board’s capabilities with the execution of the Company’s business strategy. The Board recognizes the need for refreshment to bring new perspectives, keeping in mind our commitment to diversity. In fact, we added four new directors in the past three years as part of our comprehensive refreshment and recruitment process, including Mr. Wenig, President and Chief Executive Officer of eBay. These new directors complemented our directors’ mix of skills by bringing key leadership, technology, consumer-facing and capital markets expertise to the Board. For a detailed discussion of why we have the right Board for GM, see “Item No. 1—Election of Directors” on page 7.
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PROXY STATEMENT SUMMARY
The following table provides summary information about each director nominee. For more detailed information about our directors, see “Item No. 1—Election of Directors—Your Board’s Nominees for Director” on page 10.
Name | Age | Director Since | Principal Occupation | Independent | Committee Memberships | |||||
Mary T. Barra | 56 | 2014 | Chairman & Chief Executive Officer, General Motors Company | Executive – Chair | ||||||
Theodore M. Solso | 71 | 2012 | Independent Lead Director, General Motors Company, and Retired Chairman & Chief Executive Officer, Cummins, Inc. | Executive | ||||||
Linda R. Gooden | 65 | 2015 | Retired Executive Vice President, Information Systems & Global Solutions, Lockheed Martin Corporation | Audit Cybersecurity – Chair Executive Risk | ||||||
Joseph Jimenez | 58 | 2015 | Retired Chief Executive Officer, Novartis AG | Executive Compensation Governance | ||||||
Jane L. Mendillo | 59 | 2016 | Retired President & Chief Executive Officer, Harvard Management Company | Finance Audit | ||||||
Admiral Michael G. Mullen | 71 | 2013 | Former Chairman, Joint Chiefs of Staff | Audit Cybersecurity Executive Risk – Chair | ||||||
James J. Mulva | 71 | 2012 | Retired Chairman & Chief Executive Officer, ConocoPhillips | Executive Executive Compensation Finance – Chair Risk | ||||||
Patricia F. Russo | 65 | 2009 | Chairman, Hewlett Packard Enterprise Company | Executive Executive Compensation Finance Governance – Chair | ||||||
Thomas M.Schoewe | 65 | 2011 | Retired Executive Vice President & Chief Financial Officer, Wal-Mart Stores, Inc. | Audit –Chair Cybersecurity Executive Finance Risk | ||||||
Carol M. Stephenson | 67 | 2009 | Retired Dean, Ivey Business School, The University of Western Ontario | Executive Executive Compensation – ChairGovernance | ||||||
Devin N. Wenig | 51 | 2018 | President & Chief Executive Officer, eBay Inc. |
Committee memberships to be determined at the Board’s June 2018 meeting
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PROXY STATEMENT SUMMARY
We recognize that strong corporate governance contributes to long-term shareholder value. We are committed to sound governance practices, including those described below.
Independence [Ten] out of [eleven] directors are independent Strong Independent Lead Director with clearly delineated duties All standing Board Committees other than the Executive Committee composed entirely of independent directors Regular executive sessions of non-management directors Board and Committees may hire outside advisors independently of management Best Practices Active shareholder engagement process, including a Director-Shareholder Engagement Policy Diverse Board in terms of gender, ethnicity, and specific skills and qualifications Strategy and risk oversight by full Board and Committees, including newly formed Cybersecurity Committee Long-standing commitment to sustainability and corporate social responsibility Robust stock ownership guidelines for executive officers and non-employee directors “Overboarding” limits Orientation program for new directors and continuing education for all directors Accountability Annual election of all directors Majority voting with director resignation policy (plurality standard to apply in contested elections) Annual Board and Committee self-evaluations, including individual Board member evaluation Annual evaluation of CEO (including compensation) by independent directors clawback policy that applies to our short- and long-term incentive plans Shareholder Rights Proxy access for shareholders Shareholder right to call special meetings No poison pill One-share, one-vote standard Public Policy Engagement Our Board has adopted a U.S. Corporate Political Contributions & Expenditures Policy, which together with other policies and procedures of the Company, guides GM’s approach to political contributions. Our Political Contributions Policy and Voluntary Report on Political Contributions are available on our website at gm.com/investors/corporate-governance.html. NEW FOR 2017–2018 As part of our comprehensive refreshment and recruitment process, we added a new director, Mr. Wenig, who is the President and Chief Executive Officer of eBay and brings considerable technology and consumer-facing expertise to your Board. Established new Cybersecurity Committee to enhance Board oversight of GM’s cybersecurity risk management program, policies, and procedures. Selected Ernst & Young LLP as the Company’s new independent registered public accounting firm. Enhanced Proxy Statement disclosures: Q&A with our Chairman and CEO, Independent Lead Director, and Governance Committee Chair to outline the Board’s strategic framework for driving long-term shareholder value creation, the importance of shareholder engagement, and why GM has the right Board at the right time. Expanded Proxy Statement Summary to highlight our director nominees, governance best practices, Company performance, compensation strategy, and corporate social responsibility, environmental, and sustainability performance. Overview of Board’s leadership structure and risk oversight responsibilities.
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PROXY STATEMENT SUMMARY
A Year of Transformation
Sweeping change accompanied record performance at General Motors in 2017. To continue focusing resources on its most profitable franchises, GM sold its Opel/Vauxhall and GM Financial European operations, and exited South and East Africa, and India. To advance its vision of a zero emissions world, GM laid out plans to introduce at least 20 newall-electric vehicles that will launch by 2023. The Company also recently filed a Safety Petition asking the U.S. Department of Transportation to allow GM to safely deploy its fourth-generation self-driving Cruise AV on public roads. This vehicle eliminates the steering wheel, pedals, and other unnecessary manual controls. GM expects to deploy self-driving vehicles at scale in a dense urban environment in 2019.
“The actions we took to further strengthen our core business and advance our vision for personal mobility made 2017 a
transformative year. We will continue executing our plan and reshaping our company to position it for long-term success.”
–Mary Barra, Chairman & CEO
Shareholder Return
GM returned $6.7 billion to shareholders in 2017 through share buybacks of $4.5 billion and dividends of $2.2 billion. Since 2012, GM has returned more than $25 billion, which represents more than 90% of available free cash flow generated over that time.
COMPARISON OF CUMULATIVE TOTAL RETURN
Cumulative Value of $100 Investment Through December 31, 2017
J.D. Power Awards
Chevrolet was J.D. Power’s most awarded brand in 2017, as six different Chevrolet cars, trucks, and SUVs won a total of nine awards in J.D. Power’s 2017 Vehicle Dependability, Initial Quality, and APEAL Studies. Chevrolet also earned high marks in the 2018 J.D. Power Customer Service Index (“CSI”) Study and the 2017 Sales Satisfaction Index (“SSI”) Survey. In addition, Buick and Chevrolet led the way as the two General Motors brands earning six awards and delivering more Top Three segment model rankings than any other company in the J.D. Power and Associates 2018 U.S. Vehicle Dependability Study.
GAAP NET REVENUE $145.6B INCOME $0.3B AUTO OPERATING CASH FLOW $13.9B EPS-DILUTED $0.22 Non-GAAP EBIT-adj. MARGIN 8.8% EBIT-adj. $12.8B Adj. AUTO FCF $5.2B EPS-DILUTED adj. $6.62 Note: EBIT-adjusted, EBIT-adjusted margin, adjusted automotive free cash flow andEPS-diluted-adjusted arenon-GAAP financial measures. Appendix A includes a reconciliation of thesenon-GAAP financial measures to their most directly comparable measures reported under accounting principles generally accepted in the United States.
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PROXY STATEMENT SUMMARY
Executive Compensation Highlights
We provide highlights of our compensation program below. Please review our Compensation Discussion and Analysis and compensation-related tables beginning on page 35 of this Proxy Statement for a complete understanding of our compensation program.
u | Performance-Based Compensation Structure |
u | 2017 Summary Compensation Snapshot |
Name | Salary ($) | Bonus ($) | Stock Awards ($) | Option Awards ($) | Nonequity Incentive Plan Compensation ($) | Change in Pension Value and NQ Deferred Compensation Earnings ($) | All Other Compensation | Total ($) | ||||||||||||||||||||||||
Mary T. Barra
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2,100,000
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—
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10,737,570
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3,250,003
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4,956,000
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52,792
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861,683
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21,958,048
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Charles K. Stevens, III
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1,100,000
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—
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3,076,744
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931,251
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1,622,500
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54,114
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316,430
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7,101,039
|
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Daniel Ammann
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1,450,000
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—
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4,078,222
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1,234,378
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2,138,800
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|
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—
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356,918
|
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9,258,318
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Mark L. Reuss
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1,200,000
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|
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—
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3,345,168
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1,012,504
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1,770,000
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54,390
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344,446
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7,726,508
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Alan S. Batey
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1,025,000
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—
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2,224,928
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673,426
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1,447,800
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316,601
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287,373
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5,975,128
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Karl-Thomas Neumann
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916,936
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2,000,000
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1,961,676
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593,751
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1,276,317
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126,796
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12,563
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6,888,039
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Note: For additional information on the table above, please see the Summary Compensation Table in “Executive Compensation” on page 57.
Voting RecommendationsCEO 2017 COMPENSATION STRUCTURE AVERAGE NEO 2017 COMPENSATION STRUCTURE COMPENSATION PROGRAM EVOLUTION AND ENHANCEMENTS IN 2017 Since 2013, we have taken significant actions to align our compensation programs with shareholders’ interests by focusing our leaders on the key areas that both drive the business forward and align to the short-term and long-term interests of our shareholders. For anin-depth discussion of how we have evolved our programs, including in response to active shareholder engagement, see “Executive Compensation—Compensation Overview—Shareholder Engagement Initiatives” on page 38. Key 2017 Enhancements: For short-term incentive compensation, we increased focus on key financial measures and added an individual performance element to incorporate individual performance goals for each NEO. For long-term incentive compensation, we eliminated time-vested restricted stock units and replaced them with Stock Options and incorporated relative performance measures into the performance stock units.
Board | |||
Proposals: | Recommendation | Page | |
1. | Election of directors | FOR ALL | 9 |
2. | Approve, on an advisory basis, NEO compensation | FOR | 63 |
3. | Ratification of the selection of Deloitte & Touche LLP as the Company’s independent registered public accounting firm for 2016 | FOR | 64 |
4. | Shareholder proposal regarding Implementation of Holy Land Principles for Employment in Palestine-Israel | AGAINST | 67 |
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PROXY STATEMENT SUMMARY
Environmental and Sustainability Performance
Our vision for the future can be summed up with three numbers:zero crashes,zero emissions, andzero congestion.
ZERO CRASHES GM’s number one priority is safety. We are developing new technologies to help keep our customers safe. u GM’s Cruise AV has the potential to provide a level of safety far beyond the capabilities of human drivers. u We launched Super Cruise, the world’s first hands-free highway driving technology, on the Cadillac CT6. u GM offers 53 global models with forward collision alert and lane departure warning and 40 models with side blind zone alert. | ||||||||||||
ZERO EMISSIONS GM is committed to an all-electric, zero emissions future. We are working to make cars more efficient and embrace environmentally conscious options. u GM will introduce 20 newall-electric vehicles by 2023. u In 2018, GM will increase Bolt EV production at its Orion Assembly Plant north of | ||||||||||||
u GM has committed to using 100% renewable energy in its operations by | ||||||||||||
ZERO CONGESTION GM is building autonomous, connected, and shared personal mobility options that will help end the congestion that wastes our time and money. u Maven Gig members have driven more than 6.5 million all-electric miles since February 2017, saving an estimated 250,000 gallons of u As of March 2018, more than 250 million Maven miles have been driven. u In 2018, GM submitted a petition to the U.S. Department of Transportation seeking permission to begin operating fully autonomous vehicles, without steering wheels or pedals, at scale in a dense urban environment in 2019. | ||||||||||||
The Board’s Nominees for Director
The Board recommends a voteFORthe election of each of the following nominees for director:
Director | Committee | Skills and | |||||||||
Name | Age(1) | Since | Independent | Membership(2) | Qualifications | ||||||
Mary T. Barra Chairman & Chief Executive Officer, General Motors Company | 54 | 2014 | EC (Chair) | ||||||||
Theodore M. Solso Independent Lead Director, General Motors Company, and Retired Chairman and Chief Executive Officer, Cummins, Inc. | 69 | 2012 | EC | ||||||||
Joseph J. Ashton Retired Vice President, United Auto Workers | 67 | 2014 | FC, RC | ||||||||
Linda R. Gooden Retired Executive Vice President, Information Systems & Global Solutions, Lockheed Martin Corporation | 63 | 2015 | AC, RC | ||||||||
Joseph Jimenez Chief Executive Officer, Novartis AG | 56 | 2015 | ECC, GCRC | ||||||||
Kathryn V. Marinello Senior Advisor, Ares Management LLC | 59 | 2009 | AC, GCRC, FC | ||||||||
Jane L. Mendillo Retired President and Chief Executive Officer, Harvard Management Company | 57 | — | — | ||||||||
Admiral Michael G. Mullen Former Chairman, Joint Chiefs of Staff | 69 | 2013 | AC, EC, RC (Chair) | ||||||||
James J. Mulva Retired Chairman and Chief Executive Officer, ConocoPhillips | 69 | 2012 | EC, ECC, FC (Chair), RC | ||||||||
Patricia F. Russo Chairman, Hewlett Packard Enterprise Company | 63 | 2009 | EC, ECC, FC, GCRC (Chair) | ||||||||
Thomas M. Schoewe Retired Executive Vice President and Chief Financial Officer, Wal-Mart Stores, Inc. | 63 | 2011 | AC (Chair), EC, FC, RC | ||||||||
Carol M. Stephenson Retired Dean, Ivey Business School, The University of Western Ontario | 65 | 2009 | EC, ECC (Chair), GCRC |
In 2017, GM documented existing practices by memorializing and publishing policies for shareholders, including: u Conflict Minerals Policy u Global Environmental Policy u Human Rights Policy u Global Integrity Policy, Gifts, Entertainment and Anti-Corruption u Global Speak-Up! Non-Retaliation Policy u Supplier Code of Conduct | ||||
| Dow Jones Sustainability World Index included GM for the first time and Dow Jones Sustainability North America Index included GM as the only automaker for the third consecutive year. Other third parties regularly recognize our leadership. A few of those awards include:
u U.S. Energy Star Partner of the Year – Sustained Excellence Company. | |||
Find more online. For additional information, please read our Sustainability Report, available at: u | ||||
GM initiatives to service communities and youth in science, technology, engineering and math (STEM). u | Actions GM has taken to maintain and improve a responsible supply chain.
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CUSTOMER-DRIVEN SUSTAINABILITY Putting the customer at the center of everything we do extends both to how we build our products and to how we serve and improve our communities. When it comes to sustainability, we pursue a future that creates value for all of our stakeholders.
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ITEM NO. 1 – ELECTION OF DIRECTORS
Director Election RequirementsOverview of Your Board
Our Board is elected annually by our shareholders. Upon
SUMMARY At the recommendation of the Governance and Corporate Responsibility Committee (“Governance Committee”), our Board has nominated each of the 12 persons identified below to serve as director for a one-year term or until his or her successor has been duly elected and qualified or until his or her earlier resignation or removal. Each director nominee who receives a majority of the votes cast (i.e., the number of shares voted FOR a director nominee must exceed the number of shares voted AGAINST that director nominee, excluding abstentions)2018 Annual Meeting, 11 directors will be elected as director in this uncontested election. If any nominee becomes unable to serve, proxies will be voted for the election of such other person as the Board of Directors may designate, unless the Board chooses to reduce the number of directors.
Stephen J. Girsky has elected to retire from the Board effective as of the Annual Meeting and is not standing for re-election.
Other than Jane L. Mendillo, all directors were elected at the 2015 Annual Meeting. The Board’s nomination of Ms. Mendillo followed completion of our standard candidate evaluation procedures, which include identification and evaluation of potential candidates by a search firm engaged by the Governance Committee, candidate interviews by a subcommittee of the Governance Committee, and interviews with other members of the Board.
elected. The Governance Committee is responsible for recommendingevaluated the nominees in accordance with the Committee’s charter and our Corporate Governance Guidelines and submitted the nominees to the full Board annually. In determining whetherfor approval. On April 17, 2018, the Board elected Mr. Wenig as a member of the Board. All of the other nominees are current GM Board members who were elected by shareholders at the 2017 Annual Meeting.
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ITEM NO. 1 – ELECTION OF DIRECTORS
WE HAVE THE RIGHT BOARD AT THE RIGHT TIME FOR GM GM’s long-term strategy is to recommendstrengthen its core business by deploying capital to higher-return opportunities and developing new technologies that will unlock our vision of zero crashes, zero emissions, and zero congestion while also driving cost efficiencies. Your Board believes that it is composed of individuals who collectively possess the right mix of skills, qualifications, and experiences to promote shareholder interests and value and oversee management as it executes its strategic plan, capitalizes on key opportunities, and addresses critical risks. Transforming Our Core Business: GM remains focused on strengthening our core business by delivering winning vehicles, building profitable adjacent businesses, making tough, strategic decisions, and targeting 10% core margins. Your Board has directors with established track records of driving strong performance as CEOs of large public companies. Overseeing a director for re-election,Complex, Global Manufacturing Company: As a large, complex manufacturing company with operations around the Governance Committee considersglobe, GM faces a numbervariety of factors, includingcritical challenges – from managing our global supply chain, addressing international trade issues, and controlling raw material costs to maintaining strong relationships with our international workforce. To help management tackle these challenges, your Board has directors with extensive experience leading large, global organizations as CEOs and in other key leadership positions. Performance Throughout the director’s history of attendanceBusiness Cycle: GM operates in a cyclical industry. It is crucial that GM maintain a strong balance sheet and participation in meetings, other contributionsconsistently deploy its capital to the activitieshighest-return opportunities. Your Board has directors with deep finance and capital markets expertise to oversee management’s capital allocation strategy and effectively balance long-term investment with return of value to shareholders in the near term. Navigating a Heavily Regulated Industry: As an automotive manufacturing company, GM must navigate a complicated regulatory landscape – with overlapping, and sometimes conflicting, federal, state, and international emissions, environmental, and safety regulations. In addition, as a leader in autonomous vehicle (“AV”) development, GM is working with regulators to develop new rules for AVs, a technology that did not exist just a few years ago. Your Board has directors with experience leading automotive companies and companies in other highly regulated industries – such as the pharmaceutical and energy industries – as well as directors with public policy expertise, including a former high-ranking government official. Fostering Deep Customer Relationships: In addition to being a global manufacturing company, GM active participationis – at its core – a consumer products company. One of our key priorities is to put the customer at the center of everything we do. To support this priority, your Board has directors with marketing expertise and experience leading consumer products companies to help management grow our brands and drive customer loyalty. Leading in orientationthe Future of Personal Mobility: With our vision of zero crashes, zero emissions, and ongoing educational events,zero congestion, GM is transforming the resultsfuture of personal mobility through investments in electrification, AV, and car and ridesharing. Your Board self-evaluationshas directors with extensive technology expertise gained from senior leadership roles at large technology companies. Your Board is a strategic asset for GM and any potential or actual conflictsis driving effective oversight and execution of interest.GM’s strategic plan and holding management accountable.
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ITEM NO. 1 – ELECTION OF DIRECTORS
The
u | Diversity of Skills, Qualifications, and Experience |
Your Board nominates directors upon the recommendationnominees offer a diverse range of the Governance Committee. The Governance Committee annually reviews with the Board the appropriate skills and characteristics needed for the Board to effectively perform its oversight function. Board nominees are then selected, whether existing or new, after considering current Board composition, Company strategy and otherexperience in relevant facts and circumstances.areas.
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Board Membership Criteria, Refreshment, and Succession Planning
The selection of qualified directors is complexfundamental to the Board’s successful oversight of GM’s strategy and crucialenterprise risks. As a result, ensuring your Board is composed of directors who bring diverse viewpoints and perspectives, exhibit a variety of skills, professional experiences, and backgrounds, and effectively represent the long-term interests of shareholders is critical to our long-term success. The Governance Committeeyour Board and the Board set differentGovernance Committee. The priorities for recruiting new Board members at different times, dependingdirectors are continually evolving based on the Company’s strategic needs and the makeupskills composition of your Board at any particular time. These dynamic priorities ensure the Board remains a strategic asset capable of addressing the risks, trends, and opportunities that GM will face in the future. In evaluating potential director candidates, the Governance Committee considers, among other factors, the criteria shown above in the skills and qualifications matrix for your current directors and any additional characteristics that it believes one or more directors should possess based on an assessment of the Board.needs of the Board at that time. In every case, however,director candidates for Board election must be able to contribute significantly to theyour Board’s discussion and decision-making on the broad array of complex issues facing the Company.GM. The Governance Committee sometimesalso engages a reputable, qualified search firmsfirm that uses our skills matrix to inform the search and help identify and evaluate potential candidates. Recently, our recruiting efforts have been particularly directed toward identifying candidates who have distinguished themselves as leaders of large, complex organizations with strong expertise in technology, strategy, finance, and global investment management.
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Potential candidates meeting these priorities are further evaluated on criteria that include:
In assessing potential candidates, theThe Governance Committee considers individuals with a broad range of business experience and varied backgrounds. Although GM does not have a formal policy governing diversity among directors, your Board members, we continually strivestrives to add directors ofidentify candidates with diverse backgrounds. We recognize the value of overall diversity and consider members’ and candidates’ opinions, perspectives, personal and professional experiences, and backgrounds, including gender, race, ethnicity, and country of origin, when considering Board candidates.origin. We believe that the judgment and perspectives offered by a diverse board of directors improves the quality of decision-makingdecision making and enhances the Company’s business performance. We also believe such diversity can help the Board respond more effectively to the needs of customers, shareholders, employees, suppliers, and other stakeholders worldwide.stakeholders.
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ITEM NO. 1 – ELECTION OF DIRECTORS
Pursuant to the Stockholders Agreement dated October 15, 2009 between the Company and the UAW Retiree Medical Benefits Trust (the “VEBA Trust”), the VEBA Trust has the right to designate one nominee to our Board, subject to the consent of the UAW and approval by the Board (the Board may not withhold its approval unreasonably). The VEBA Trust has designated Mr. Ashton, who has been recommended by the Governance Committee and nominated by the Board as part of the slate of candidates it recommends for election at the Annual Meeting.
u | Candidate Recommendations |
The Governance Committee will consider persons recommended by shareholders for election to the Board. To recommend an individual for Board membership, write to Jill E. Sutton, Corporate Secretary and Deputy General Counsel, Corporate, Finance and Strategic Transactions (“Corporate Secretary and Deputy General Counsel”) of our Company, at the mailing address or e-mail address provided on page 74 in“How can I obtain the Company’s corporate governance information?”The Governance Committee will review the qualifications and experience of each recommended candidate using the same criteria for candidates proposed by Board members and communicate its decision to the candidate or the person who made the recommendation.
GM has received notice pursuant to our Bylaws that a shareholder owning two shares of our common stock intends to nominate candidates for election to the Board at the 2016 Annual Meeting. The Board has determined in its reasonable judgment that this is not considered a contested election, and therefore, majority voting will apply. The Governance Committee evaluated these candidates as discussed above, and the Proxy Committee appointed by the Board intends to vote against the election of these candidates.
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Your Board recommends a voteFORall of the nominees listed below.
Set forth below is other information about our director nominees, including their name and age, recent employment or principal occupation, their period of service as a GM director, the names of other public companies for which they currently serve as a director or have served as a director withinin the past, five years, and a summary of their specific experience,experiences, qualifications, attributes, and skills. We believe each of your Board’s nominees is highly qualified with unique experiences that are particularly beneficial to GM. Collectively, we believe these director nominees represent the best mix of expertise, qualifications, and skills that led to advance GM’s business strategy and serve the conclusion that they are qualified to serve asinterest of all of our shareholders by driving long-term shareholder value.
The Board of Directors recommends a director on our Board at this time.voteFOR each of the nominees below.
TO RECOMMEND AN INDIVIDUAL FOR BOARD MEMBERSHIP, WRITE TO: GM’s Corporate Secretary, at General Motors Company, Mail Code482-C24-A68, 300 Renaissance Center, Detroit, Michigan 48265, or by e-mail to shareholder.relations@gm.com.
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ITEM NO. 1 – ELECTION OF DIRECTORS
Mary T. Barra | Theodore M. Solso | |
Chairman & Chief Executive Officer, General Motors Company |
Ms. Barra was elected Chairman of the GM Board of Directors on January 4, 2016. She has served as CEO of GM since January 15, 2014, when she also became a member of GM’s Board. Prior to becoming CEO, Ms. Barra served as Executive Vice President, Global Product Development, Purchasing and Supply Chain since August 2013. She served as Senior Vice President, Global Product Development, from 2011 to 2013; Vice President, Global Human Resources, from 2009 to 2011; and Vice President, Global Manufacturing Engineering, from 2008 to 2009.
Reasons for Nomination:
With more than 35 years at GM and having served in various leadership roles prior to becoming Chairman and CEO of the Company, Ms. Barra brings to our Board an in-depth knowledge of the Company and the global automotive industry. She has extensive leadership, strategic planning, operating and business experience and a deep understanding of the Company’s strengths, weaknesses, risks, and challenges. Under her leadership, GM is working to lead the transformation of personal mobility through advanced technologies such as connectivity, alternative propulsion, and autonomous driving. She has also established GM’s corporate culture and strategic direction based on putting the customer at the center of everything we do, all around the world, with quality and safety as foundational commitments.
As Chairman and CEO, Ms. Barra is able to focus the Board’s oversight and drive the most efficient execution of GM’s plan and vision for the future. In addition to her demonstrated leadership and management skills, Ms. Barra’s strong engineering background and leadership experience in global product development enables her to provide significant insight to the Board on one of the most critical and complex parts of GM’s business. Her previous leadership roles in purchasing and supply chain, human resources, and manufacturing engineering also allow her to contribute to Board deliberations on matters regarding those key areas of the Company. Ms. Barra’s service to GM and experience in serving as a director of another large public company with complex, global operations provides her with an extensive understanding of the governance and management matters that large public companies face.
and Retired Chairman & Chief Executive Officer, | |||
56 years old | 71 years old | ||
Director since: 2014 | Director since: 2012 | ||
Committees Executive (Chair) Current Public Company Directorships The Walt Disney Company Prior Public Company Directorships General Dynamics Corporation (2011 to 2017) Prior Experience Ms. Barra has served as Chairman of GM’s Board of Directors since January 2016 and Chief Executive Officer of GM since January 2014. Prior to that time, she served as Executive Vice President, Global Product Development, Purchasing and Supply Chain from 2013 to 2014; Senior Vice President, Global Product Development from 2011 to 2013; Vice President, Global Human Resources from 2009 to 2011; and Vice President, Global Manufacturing Engineering from 2008 to 2009. Ms. Barra began her career at GM in 1980. Reasons for Nomination u Extensive senior leadership experience gained as the CEO of GM and in other key leadership positions at the Company, including experience in operational excellence, strategic planning, purchasing and supply chain, human resources, and manufacturing and engineering. u In-depth knowledge of the global automotive industry. u Deep understanding of GM’s strengths, weaknesses, opportunities, challenges, risks, and corporate culture. u Ability to drive the efficient execution of GM’s strategic plan and vision for the future. u Strong leadership and management skills coupled with extensive engineering and global product development experience. u Valuable knowledge of key governance matters gained as a director of GM and other large global public companies. | Committees Executive Current Public Company Directorships Ball Corporation (Lead Director) Prior Public Company Directorships Ashland Inc. (1999 to 2012) (Lead director 2003 to 2010) Prior Experience Mr. Solso served asNon-Executive Chairman of the GM Board of Directors from 2014 to 2016. He was Chairman and Chief Executive Officer of Cummins, Inc. | ||
(“Cummins”) from 2000 until his retirement in 2011 and President and Chief Operating Officer of Cummins from 1995 to 2000.
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Extensive senior leadership experience gained as the CEO of Cummins, including automotive-related experience and experience in finance, accounting, and vehicle and workplace safety.
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Background leading a company through strong financial performance and shareholder returns, international growth, and business restructurings.
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Valuable knowledge of key governance matters, including environmental issues, corporate responsibility, diversity, and human rights issues, gained as the CEO of Cummins and the lead director of GM and other large global public companies.
u Valuable insight into advancing the business priorities of GM’s international operations gained as the U.S. Chairman of theU.S.-Brazil CEO Forum. |
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Mr. Solso has served as the Independent Lead Director of our Board since January 4, 2016. Mr. Solso had been the Non-Executive Chairman of our Board of Directors since January 2014. He served as Chairman and Chief Executive Officer of Cummins, Inc., a global manufacturer of diesel and natural gas engines and engine-related component products, from 2000 until his retirement in 2011. Prior to becoming Chairman and CEO, Mr. Solso held various other senior management roles, including President and Chief Operating Officer from 1995 through 1999 and Vice President in charge of Cummins’ engine business from 1988 to 1995.
ITEM NO. 1 – ELECTION OF DIRECTORS
Reasons for Nomination:
Mr. Solso gained significant senior management experience during his 40-year career at Cummins, which culminated in his role as Chairman and CEO. He brings to our Board his experience and insight into the complexities of managing a major global organization. Mr. Solso led Cummins through strong financial performance and shareholder returns, international growth, business restructuring, and leadership in emissions reduction technology and related environmental activities, corporate responsibility, diversity, and human rights issues. His extensive experience in manufacturing and engineering of diesel engines and compliance with challenging emissions laws and regulations enables him to contribute significantly to Board deliberations regarding GM’s global product development strategies. His previous experience in serving as U.S. Chairman of the U.S.-Brazil CEO Forum provides valuable insight into advancing the business priorities of our operations in South America. In addition to his deep understanding of global markets and business operations and corporate responsibility, Mr. Solso brings to our Board his experience as a director of other large, global public companies, particularly in the areas of finance, accounting and corporate governance.
Mr. Ashton served as a Vice President of the International Union, United Automobile, Aerospace and Agricultural Workers of America (the “UAW”) from 2010 until his retirement in June 2014. Prior to that time, Mr. Ashton served as director of the UAW’s Region 9 (Central New York, New Jersey, and Pennsylvania) from 2006 to 2010 and as assistant director of Region 9 from 2003 to 2006. He had been a member of the UAW International staff since 1986. Mr. Ashton is active in labor and civic affairs, including previously serving as the Executive Vice President of the Pennsylvania AFL-CIO Executive Council and Executive Vice President of the New Jersey AFL-CIO. Under the terms of the Stockholders Agreement dated October 15, 2009, Mr. Ashton was designated for nomination to the GM Board by the VEBA Trust, of which he is a member of the Financial Committee.
Reasons for Nomination:
During his career with the UAW, Mr. Ashton played a key role in organizing campaigns and contract negotiations with major manufacturing and technology companies in a variety of industries including vehicle components, defense, aerospace, steel, and marine products. Based on these experiences, he has developed a deep understanding of how labor strategy can affect a company’s financial success, including expertise in areas such as manufacturing processes, pension and health care costs, government relations, employee engagement and training, and plant safety.
Linda R. Gooden | Joseph Jimenez | |
Retired Executive Vice President, Information Systems & Global Solutions, Lockheed Martin Corporation |
58 years old | ||
Director since: 2015 | Director since: 2015 | |
Committees Audit, Cybersecurity (Chair), Executive, Risk Current Public Company Automatic Data Processing, Inc., The Home Depot, Inc., WGL Holdings,Inc. Prior Experience |
Ms. Gooden served as Executive Vice President, Information Systems & Global Solutions (“IS&GS”) of Lockheed Martin Corporation (“Lockheed”) from 2007 to 2013;
Ms. Gooden served as Executive Vice President, Information Systems & Global Solutions of Lockheed Martin Corporation (“Lockheed”) from 2007 to 2013. She was Deputy Executive Vice President, Information and Technology Services of Lockheed from October to December 2006; and President, Information Technology of Lockheed from 1997 to December 2006.
Reasons for Nomination
u Significant senior leadership experience gained through various leadership positions at Lockheed, including experience in technology, innovation, acquisitions, divestitures, business restructuring, finance, and risk management.
u Valuable insight into GM’s information technology (“IT”) function, technology systems and processes, and cybersecurity framework, including those related to mobility and autonomous vehicles, gained through various leadership roles at Lockheed.
u Extensive expertise in cybersecurity and IT as well as significant operational, strategic planning, and government relations experience.
u Valuable knowledge of key governance matters gained as a director of GM and other large global public companies.
Committees
Reasons for Nomination:
Ms. Gooden brings to our Board her strong leadership capability demonstrated through her various senior leadership positions at Lockheed. She has significant operations and strategic planning expertise and an extensive background in information technology (“IT”). Under her leadership as Executive Vice President of IS&GS, Lockheed expanded its IT capabilities beyond government customers to international and commercial markets. In her role as President of Lockheed’s IT division, Ms. Gooden grew the business to become a multibillion-dollar business. Her deep knowledge of IT adds a valuable perspective to our Board deliberations regarding GM’s IT transformation, cybersecurity matters, and various technology systems and processes. Moreover, Ms. Gooden brings to our Board her experience in business restructuring, finance, cybersecurity, and risk management. She also brings her experience as a director at other public companies, particularly in the areas of finance, audit, strategic investments, acquisitions, and divestitures.
Current Public Company | |
The Procter & Gamble Co. Prior Public Company Colgate-Palmolive Company (2010 to 2015) Prior Experience |
Mr. Jimenez has been Chief Executive Officer of Novartis AG (“Novartis”) since 2010. He joined Novartis in April 2007 as Head of the Consumer Health Division, and in October 2007, he became Head of the Pharmaceuticals Division, where he served until 2010.
Mr. Jimenez served as Chief Executive Officer of Novartis AG (“Novartis”) from 2010 until his retirement in 2017. He was Head of Novartis’ Pharmaceuticals Division from October 2007 to 2010 and Head of Novartis’ Consumer Health Division from April to October 2007. Prior to joining Novartis, Mr. Jimenez served as an Advisor to the Blackstone Group L.P., a private equity firm, from 2006 to 2007. He was President and Chief Executive Officer of H. J. Heinz Company (“Heinz”) North America from 2002 to 2006 and Executive Vice President, President and Chief Executive Officer of Heinz Europe from 1999 to 2002. From 1993 to 1998, Mr. Jimenez held various leadership positions at ConAgra Foods Inc. (“ConAgra”), including President and Senior Vice President of two operating divisions. He began his career in 1984 at The Clorox Company, where he held a number of progressive roles in marketing and brand management.
Reasons for Nomination:
Mr. Jimenez brings to our Board significant international and operational leadership, strategic planning, and business and finance experience gained through his role as Chief Executive Officer of Novartis, a complex, global company in a highly regulated industry, and President of various operating divisions at Heinz and ConAgra. Mr. Jimenez has a long track record in consumer businesses, which enables him to bring a consumer orientation and valuable insight to Board deliberations regarding our strategy to earn customers for life. Moreover, he has business restructuring expertise, and he executed significant business transformations at both Heinz and Novartis, which will enable him to make a significant contribution to our Board as we continue to evaluate the structure of our global business. Mr. Jimenez also brings to our Board his prior experience as a director of another large, global public company.
Ms. Marinello has served as Senior Advisor of Ares Management LLC (“Ares”), a global asset manager, since rejoining the company in March 2014. Prior to that, she served as Chairman and Chief Executive Officer of Stream Global Services, Inc. (“Stream”), a global business process outsource service provider specializing in customer relationship management, since August 2010. Ms. Marinello served as senior advisor and consultant at Providence Equity Partners LLC, a private equity firm, and Ares from June to August 2010. She served as Chairman and Chief Executive Officer of Ceridian Corporation, a human resources outsourcing company, from December 2007 to January 2010 and President and Chief Executive Officer from 2006 to 2007. Prior to joining Ceridian, Ms. Marinello spent 10 years at General Electric Company (“GE”), serving in a variety of senior roles, including President and Chief Executive Officer of GE Fleet Services, a division of GE, from 2002 to 2006.
Reasons for Nomination:
Ms. Marinello’s experience at large, complex service companies in various industries enables her to bring a varied perspective to our Board. As Chairman and CEO of Stream, she was focused on using information technology to enhance customer service, an area that is key to GM’s long-term business strategy. At Ceridian, she led a business service company providing integrated human resource systems, that involved a wide range of issues including audit and financial reporting, compliance and controls, and mergers and acquisitions. As the former President and CEO of GE Fleet Services, Ms. Marinello has significant experience with vehicle fleet sales and financing and dealer relations, which enables her to bring the customer perspective to Board decision-making. Moreover, at GE Capital, as well as in her prior roles at Chemical Bank, Citibank, and First Bank Systems, Inc., Ms. Marinello operated large consumer financial services divisions, which included auto lending, auto warranty, telematics, and auto insurance companies, further broadening her contributions to our Board. She also brings her experience as a director of other large, global public companies.
(“Heinz”) North America from 2002 to 2006 and Executive Vice President, President and Chief Executive Officer of Heinz Europe from 1999 to 2002. Prior to joining Heinz, Mr. Jimenez held various leadership positions at ConAgra Foods Inc. (“ConAgra”), including President and Senior Vice President of two operating divisions from 1993 to 1998.
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| Extensive senior leadership experience gained as the CEO of Novartis and in other senior leadership positions in the consumer products industry, including experience in international operations, strategic planning, and finance. u Valuable insight into GM’s strategy to enhance the customer experience and earn customers for life gained through various senior leadership positions at Heinz and ConAgra and as a director of Colgate-Palmolive Company. u Experience executing business restructurings and significant business transformations at both Heinz and Novartis. u Valuable knowledge of key governance matters gained as the CEO of Novartis and a director of GM and other large global public companies. |
Ms. Mendillo served as President and Chief Executive Officer of the Harvard Management Company (“HMC”) from 2008 to 2014, where she managed Harvard University’s approximately $37 billion global endowment and related assets. From 2002 to 2008, she served as the Chief Investment Officer of Wellesley College. Prior to that, Ms. Mendillo spent 15 years at HMC in various investment roles. She serves as chair of the investment committee of the Partners Healthcare System, is a member of the board of directors and investment committees of the Mellon Foundation and the Boston Foundation, and serves as a Senior Investment Advisor to the Old Mountain Private Trust Company.
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Reasons for Nomination:ITEM NO. 1 – ELECTION OF DIRECTORS
Ms. Mendillo brings to the Board valuable financial perspective and extensive investment management experience. In addition, she brings to our Board strong senior leadership and risk management experience, as well as capital markets expertise, from her over 30 years in the endowment and investment management field. As President and CEO of HMC, she successfully led the company through the financial crisis, repositioning the endowment and reestablishing a world-class investment platform to support Harvard’s future educational and research goals. As the Chief Investment Officer of Wellesley College, she built the college’s first investment office and delivered substantial growth in the college endowment through a period of rapidly changing market conditions. Ms. Mendillo’s background and extensive experience will enable her to make a significant contribution in the Board’s oversight of GM’s strategic initiatives and varied financial and risk management issues.
Jane L. Mendillo | Admiral Michael G. Mullen | ||
Retired President & Chief Executive Officer, Harvard Management Company | Former Chairman, Joint Chiefs of Staff | ||
59 years old | 71 years old | ||
Director | |||
Director since: 2013 | |||
Committees Audit, Finance Current Public Company Lazard Ltd Prior Experience Ms. Mendillo served as President and Chief Executive Officer of the Harvard Management Company (“HMC”) from 2008 to 2014, managing Harvard University’s approximately $37 billion global endowment and related assets. Prior to joining HMC, she was Chief Investment Officer of Wellesley College from 2002 to 2008; and prior to that, she spent 15 years at HMC in various other investment roles. She also served as Chair of the investment committee of the Partners Healthcare System; a member of the board of directors and investment committee of the Mellon Foundation; Senior Investment Advisor and Trustee to the Old Mountain Private Trust Company; and a member of the Board and Executive Committee of Berklee College of Music. Reasons for Nomination u Extensive senior leadership experience gained as the CEO of HMC, including experience in risk and crisis management. u Deep capital markets expertise gained from her more than 30 years managing globally diverse endowments and investment portfolios. u Valuable insight into GM’s disciplined capital allocation framework and its financial policies and strategies. u Valuable knowledge of key governance matters gained as a director of GM and another large global public company. | Committees Audit, Cybersecurity, Executive, Risk (Chair) Current Public Company Directorships Sprint Corporation Prior Experience Admiral Mullen served as the 17th Chairman of the Joint Chiefs of Staff from 2007 until his retirement in 2011, one of his four different four-star assignments; the others included the 28th Chief of Naval Operations from 2005 to 2007; Commander, U.S. Naval Forces Europe/Allied Joint Force Command Naples from 2004 to 2005; and the 32nd Vice Chief Naval Officer from 2003 to 2004. Admiral Mullen has been President of MGM Consulting LLC since 2012, and he serves as a Charles and Marie Robertson Visiting Professor at the Woodrow Wilson School of Public and International Affairs at Princeton University. Reasons for Nomination u Extensive senior leadership experience gained over a43-year career in the U.S. military, including four-star assignments in the U.S. Navy, which were equivalent to the Navy’s Chief Executive Officer, Chief Operating Officer, and Chief Financial Officer, and culminating in his appointment as Chairman of the Joint Chiefs of Staff. u Valuable insight into GM’s IT function, technology systems and processes, and cybersecurity framework gained through overseeing the rapid development and deployment of innovative technologies for effective 21st-century military solutions. u Deep experience leading change in complex organizations, strategic planning, budget policy, risk and crisis management, executive development and succession planning, diversity implementation, cybersecurity, and technical innovation. u Experience in navigating geopolitical risks, succession planning, diversity, accountability, crisis management, public policy, and safety culture. u Valuable knowledge of key governance matters gained as a long-tenured military leader and a director of GM and another large global public company. |
13 |
Admiral Mullen served as the 17th Chairman of the Joint Chiefs of Staff from October 2007 until his retirement in 2011. Previously, he served as the 28th Chief of Naval Operations (“CNO”) from July 2005 to 2007. CNO was one of four different four-star assignments Admiral Mullen held; the other three included Commander, U.S. Naval Forces Europe, Commander, Allied Joint Force Command, and the 32nd Vice Chief of Naval Operations. Since 2012, Admiral Mullen has served as President of MGM Consulting LLC and is the Charles and Marie Robertson Visiting Professor at the Woodrow Wilson School of Public and International Affairs at Princeton University.
ITEM NO. 1 – ELECTION OF DIRECTORS
Reasons for Nomination:
Admiral Mullen brings to our Board extensive senior leadership experience gained over his 43-year career in the U.S. military. As Chairman of the Joint Chiefs of Staff, the highest-ranking officer in the U.S. military, Admiral Mullen led the armed forces during a critical period of transition, overseeing two active war zones. His involvement in key aspects of U.S. diplomacy, including forging vital relationships with diverse countries around the world, brings valuable insight to our Board as we continue to evaluate the structure of our global business. In addition to having strong global relationships, Admiral Mullen has deep experience in leading change in complex organizations, risk management, crisis management, executive development and succession planning, diversity implementation, strategic planning, budget policy, cybersecurity, and technical innovation, all of which are important to the oversight of GM’s strategic initiatives. This depth of experience enables him to make a significant contribution to our Board. Admiral Mullen also brings his experience as a director of another large public company.
James J. Mulva | Patricia F. Russo | |
Retired Chairman | Chairman, Hewlett Packard Enterprise Company | |
65 years old | ||
Director since: 2012 | Director since: 2009 | |
Executive, Executive Compensation, Finance (Chair), Risk | ||
Current Public Company General Electric Company | ||
and Baker Hughes, a GE company Prior Public Company Statoil ASA (2013 to 2015) Prior Experience |
Mr. Mulva served as Chairman and Chief Executive Officer of ConocoPhillips from 2004 until his retirement in 2012. He was Chairman, President, and Chief Executive Officer of ConocoPhillips from 2004 to 2008 and President and Chief Executive Officer of ConocoPhillips an international integrated oil and gas company, from 2004 until his retirement in 2012; Chairman, President and Chief Executive Officer from 2004 to 2008; and President and Chief Executive Officer from 2002 to 2004.
Reasons for Nomination
u Extensive senior leadership experience gained as the CEO of ConocoPhillips, including experience in finance and international business.
u Significant strategic business experience, including with respect to mergers and acquisitions, business restructurings, joint ventures, and the successful navigation of the highly competitive energy industry.
u Valuable insight into GM’s manufacturing and safety strategies gained through experience in global manufacturing at ConocoPhillips with a focus on risk management.
u Valuable knowledge of key governance matters gained as the CEO of ConocoPhillips and a director of GM and other large global public companies.
Committees
Reasons for Nomination:
Mr. Mulva brings to our Board 39 years of experience in the energy industry, first at Phillips Petroleum Company (“Phillips”) and then ConocoPhillips. Prior to overseeing the merger of Conoco and Phillips in 2002, Mr. Mulva served as Chairman and Chief Executive Officer of Phillips, where he also held various domestic and international senior management positions in finance, including Executive Vice President and Chief Financial Officer. As Chief Executive Officer of Phillips and later ConocoPhillips, Mr. Mulva oversaw mergers and acquisitions, business restructurings and negotiated joint ventures, positioning the company to compete in an increasingly challenging and highly competitive industry. Prior to his retirement from ConocoPhillips, Mr. Mulva oversaw the strategic repositioning of the company to split its fuel production and refining businesses. Mr. Mulva’s expertise in the energy industry provides valuable insight to our Board in developing GM’s long-term energy diversity strategy. Mr. Mulva also brings to our Board an in-depth background in finance and his experience as a director of other large, global public companies.
Current Public Company Arconic Inc. | |
Prior Public Company Hewlett-Packard Company (2011 to 2015) Prior Experience Ms. Russo served as Lead Director of the Hewlett-Packard Company Board of Directors from 2014 to 2015. She was Lead Director of the GM Board of Directors from Reasons for Nomination |
Ms. Russo has served as Chairman of Hewlett Packard Enterprise Company since November 2015, after the separation of Hewlett-Packard Company (“HP”) into two companies. She had been Lead Director of HP since 2014. She served as Chief Executive Officer of Alcatel-Lucent S.A. from 2006 to 2008. Prior to the merger of Alcatel S.A. (“Alcatel”)
u Extensive senior leadership gained as the CEO of Alcatel-Lucent and Lucent, including experience in corporate strategy, finance, sales and marketing, technology, and leadership development.
u Significant strategic business experience gained through managing critical technology disruptions and successfully leading Lucent through a severe industry downturn.
u Valuable insight into GM’s evaluation and execution of strategic transactions gained through experience overseeing Hewlett-Packard Company’s split into two companies, the Alcoa-Arconic split, and managing the Alcatel-Lucent merger.
u Valuable knowledge of key governance matters, including executive compensation, gained as the CEO of Alcatel-Lucent and Lucent and a director of GM and Lucent Technologies, Inc. (“Lucent”) in 2006, she served as Chairman and Chief Executive Officer of Lucent from 2003 to 2006 and President and Chief Executive Officer from 2002 to 2003. Ms. Russo served as Lead Director of our Board from March 2010 to January 2014.
Reasons for Nomination:
As the chief executive officer of highly technical, global, complex companies, Ms. Russo demonstrated leadership that strongly supported her nomination to our Board. She dealt with a wide range of issues including mergers and acquisitions, technology disruptions and business restructuring as she led Lucent’s recovery through a severe industry downturn and later a merger with Alcatel, a French company. She has recently led the HP board of directors in connection with its split into two public companies, gaining valuable experience in connection with a highly complex business restructuring transaction. In addition, she brings to the Board extensive global experience in corporate strategy, finance, sales and marketing, technology, and leadership development. Ms. Russo also has extensive expertise in corporate governance and executive compensation as a member of the board and board committees of other large global public companies.
14 |
ITEM NO. 1 – ELECTION OF DIRECTORS
Thomas M. Schoewe | Carol M. Stephenson, O.C. | |
Retired Executive Vice President & Chief Financial Officer, Wal-Mart Stores, Inc. | Retired Dean, Ivey Business School, The University of Western Ontario | |
65 years old | 67 years old | |
Director since: 2011 | Director since: 2009 | |
Committees Audit (Chair), Cybersecurity, Executive, Finance, Risk
KKR Management LLC and Northrop Grumman Corporation Prior Public Company Directorship PulteGroup, Inc. (2009 to 2012) Prior Experience Mr. Schoewe served as Executive Vice President and Chief Financial Officer ofWal-Mart Stores, Inc.(“Wal-Mart”) | ||
from 2000 to 2011. Prior to joining
u Extensive financial expertise as the CFO ofWal-Mart and Black & Decker. u Significant senior leadership experience gained in various leadership positions, including experience in financial reporting, accounting and controls, business planning and analysis, and risk management. u Valuable insight into GM’s IT function, technology systems and processes, and cybersecurity framework gained through experience leading large-scale, transformational IT implementations atWal-Mart and Black & Decker. u Valuable knowledge of key governance matters gained as a director of GM and at other large global public companies. | ||
| ||
Mr. Schoewe served as Executive Vice President and Chief Financial Officer of Wal-Mart Stores, Inc. (“Wal-Mart”) from 2000 to 2011. Prior to joining Wal-Mart, Mr. Schoewe worked for Black & Decker Corporation from 1986 to 1999, most recently serving as Senior Vice President and Chief Financial Officer.
Reasons for Nomination:
With extensive experience in finance, including serving as the chief financial officer of large multinational, consumer-facing companies, Mr. Schoewe brings financial expertise, corporate leadership, and operational experience to our Board. His extensive experience as a senior leader in corporate finance has provided him with key skills, including financial reporting, accounting and control, business planning and analysis, and risk management that are valuable to the oversight of our business. Mr. Schoewe also brings to our Board his experience at Wal-Mart and Black & Decker with large-scale, transformational information technology implementations, which provides valuable insight as we continue to restructure our IT operations. Further, Mr. Schoewe’s previous and current board positions at public companies involved with home building, security, and investments provides exposure to diverse industries with unique challenges enabling him to make a significant contribution to our Board.
Current Public Company Intact Financial Corporation (formerly ING Canada) Prior Public Company Directorships Ballard Power Systems, Inc. (2012 to 2017) and Manitoba Telecom Services (2008 to 2016) Prior Experience Ms. Stephenson served as Dean of the Ivey Business School at the University of Western Ontario from 2003 until her retirement in 2013. Prior to joining the Ivey Business School, she was President and Chief Executive Officer of Lucent Technologies Canada from 1999 to 2003. She was also a member of the Advisory Board of General Motors of Canada, Limited, a GM subsidiary, from 2005 to 2009 and appointed an officer of the Order of Canada in 2009. Reasons for Nomination u Significant senior leadership experience gained as Dean of the Ivey Business School and in leadership positions in the telecommunications industry. u Valuable insight into GM’s strategy to strengthen our core business and transform the future of personal mobility gained through expertise in marketing, operations, strategic planning, technology development, and financial management. u Extensive expertise in North American trade issues and the Canadian business environment gained as a director at several leading Canadian companies. u Valuable knowledge of key governance matters, including executive compensation, gained as a director of GM and at other large global public companies. |
15 |
Ms. Stephenson served as Dean of the Ivey Business School at The University of Western Ontario (“Ivey”) from 2003 until her retirement in September 2013. Prior to joining Ivey, Ms. Stephenson served as President and Chief Executive Officer, Lucent Technologies Canada from 1999 to 2003. She was a member of the Advisory Board of General Motors of Canada, Limited (“GM Canada”), a GM subsidiary, from 2005 to 2009. Ms. Stephenson was appointed an Officer of the Order of Canada in 2009.
ITEM NO. 1 – ELECTION OF DIRECTORS
Reasons for Nomination:
Ms. Stephenson’s experience as Dean of Ivey and President and Chief Executive Officer of Lucent Technologies Canada provides our Board with diverse perspectives and progressive management expertise in marketing, operations, strategic planning, technology development, and financial management. Her experience on the boards of several top Canadian companies provides our Board with a broad perspective on successful management strategies and insight on matters affecting the business interests of GM and GM Canada. Ms. Stephenson also brings her experience in serving on the compensation and governance committees of other public companies.
President & Chief Executive Officer, eBay Inc. | |||
51 years old | |||
Director since: 2018 | |||
Committees Committee memberships to be determined at the Board’s June 2018 meeting. Current Public Company Directorships eBay Inc. Prior Experience In July 2015, Mr. Wenig was appointed as President and Chief Executive Officer of eBay. Prior to that time, he served as President of eBay’s Marketplaces business from 2011 to July 2015. Prior to joining eBay, Mr. Wenig was Chief Executive Officer of Thomson Reuters Corporation’s (“Thomson Reuters”) largest division, Thomson Reuters Markets, from 2008 to 2011; Chief Operating Officer of Reuters Group plc (“Reuters”) from 2006 to 2008; and President of Reuters Business divisions from 2003 to 2006. Reasons for Nomination u Extensive senior leadership experience gained as the CEO of eBay, including experience in technology, global operations, and strategic planning. u Critical technology insight into GM’s strategies related to the future of mobility, autonomous vehicles, vehicle connectivity, and data monetization gained through various roles at eBay. u Valuable insight into GM’s strategy to enhance the customer experience and earn customers for life gained through various consumer-facing leadership roles at eBay, Thomson Reuters, and Reuters. u Valuable knowledge of key governance matters gained as the CEO of eBay and a director of other large global public companies. |
16 |
Non-Employee Director CompensationITEM NO. 1 – ELECTION OF DIRECTORS
We strive to provide a level
Non-Employee Director Compensation
Ournon-employee directors receive cash compensation as well as equity compensation in the form of compensation we believe is necessary to attract and retain high-quality non-employee directors. Ms. Barra, our sole employee director, does not receive additional compensationGM Deferred Share Units (“DSUs”) for hertheir Board service. Compensation for ournon-employee directors is set by ourthe Board at the recommendation of the Governance Committee.
The Governance Committee, which consists solely of independent directors, annually assesses the form and amount of non-employee director compensation and recommends changes, if appropriate, to the Board based upon competitive market practices. The Governance Committee reviews director compensation data for the same companies that comprise the peer group we use for benchmarking executive compensation described on page 38. The process for setting director pay is guided by the following principles:
u | Guiding Principles |
u | Fairly compensate directors for their responsibilities and time commitments. |
u | Attract and retain highly qualified directors by offering a compensation program consistent with those at companies |
Align the interests of directors with our shareholders by providing a significant portion of compensation in equity and requiring directors to continue to own our common stock (or common stock equivalents) |
Provide compensation that is simple and transparent to shareholders. |
u | Annual Review Process |
The Governance Committee, which consists solely of independent directors, annually assesses the form and amount ofnon-employee director compensation and recommends changes, if appropriate, to the Board based upon competitive market practices. GM’s Legal Staff also supports the Committee in determining director compensation and designing the related benefit programs. In addition, if the Governance Committee candetermines it is necessary, it has the authority to engage the services of outside consultants, experts, and others to assist in designing and setting director compensation. As part of its annual review, the Committee. During 2015,Committee conducts extensive benchmarking by reviewing director compensation data for the executive compensation peer group described in “Executive Compensation—Compensation Overview—Peer Group for Compensation Comparisons” on page 41. Following its review of GM’s director compensation in December 2017, the Governance Committee did not engage any consultantsrecommended that the Board maintain the same structure and level of compensation and stock ownership requirements for 2018 as were in reviewing and setting director compensation.place in 2017.
Director Stock Ownership and Holding Requirements |
u | Eachnon-employee director is required to own our common stock or DSUs with a market value of at least $500,000. |
In 2015,
u | Each director has up to five years from the date he or she is first elected to the Board to meet this ownership requirement. |
u | Non-employee directors are prohibited from selling any GM securities or derivatives of GM securities, such as DSUs, while they are members of the Board. |
u | Ownership guidelines are reviewed each year to confirm they continue to be effective in aligning the interests of the Board and our shareholders. |
u | All of our directors are in compliance with our stock retention requirements. Mr. Wenig is within his five-year compliance period and is expected to meet the ownership requirement by the end of such period. All other directors have met or exceeded the ownership requirement. |
u | Annual Compensation |
During 2017, compensation fornon-employee member directors consisted of the elements described in the table below. We do not pay any other retainers or meeting fees. The Independent Lead Director and Committee Chairs receive additional compensation due to the increased workload and additional responsibilities associated with these positions. In particular, Mr. Solso’s compensation as Independent Lead Director reflects the additional time commitment for this role, which includes, among other responsibilities, attending all Board received anCommittee meetings, meeting with the Company’s investors, and attending additional meetings with the Company’s senior management, including the CEO. For additional information about the roles and responsibilities of our Independent Lead Director, see “Corporate Governance—Board Leadership Structure” on page 21.
Compensation Element | 2017 | |||
Board Retainer | $ | 285,000 | ||
Independent Lead Director Fee | $ | 100,000 | ||
Audit Committee Chair Fee | $30,000 | |||
All Other Committee Chair Fees (excluding the Executive Committee) | $20,000 |
17 |
ITEM NO. 1 – ELECTION OF DIRECTORS
Non-employee directors are required to defer 50% of their annual Board retainer ($142,500) into DSUs under the General Motors Company Deferred Compensation Plan forNon-Employee Directors (the “Director Compensation Plan”). Directors may elect to defer all or half of $250,000their remaining Board retainer or amounts payable (if any) for service on the Board. Theserving as Committee Chair of the Audit Committee received anor Independent Lead Director into additional annual retainer of $30,000 and the Chair of the Compensation Committee received an additional retainer of $20,000. The Chairs of all other Board Committees (excluding the Executive Committee) received an additional annual retainer of $15,000. The additional fee paid to Mr. Solso for service as non-executive Chairman of the Board was $300,000 per year.DSUs. The fees for a director who joins or leaves the Board or assumes additional responsibilities during the year are prorated for his or her period of service.
Under the General Motors Company Deferred Compensation Plan for Non-Employee Directors (the “Director Compensation Plan”), non-employee directors are required to defer 50 percent of their annual Board retainer (i.e., $125,000) into Deferred Share Units (“DSUs”) of the Company’s common stock. Non-employee directors may elect to defer all or half of their remaining Board retainer or amounts payable (if any) for serving as Committee Chair, Chairman or Lead Director into additional DSUs.
Following the recommendation of the Governance Committee, our Board determined that no change would be made to director compensation for 2016. The Board also determined that for the first two months of 2016, Mr. Solso would receive an additional fee of $50,000 (i.e., the annual Chairman fee of $300,000 prorated for two months of service) for transitional services following Ms. Barra’s assumption of the Chairman role on January 4, 2016.
Effective March 4, 2016, the additional retainer paid for service as Lead Director is $100,000 per year. Mr. Solso’s pay as Lead Director reflects the additional time commitment for this role, which includes, among other responsibilities, attending all Board Committee meetings and meeting with the Company’s investors, and attending additional meetings with the Company’s senior management, including the CEO, CFO, and others.
How Deferred Share Units Work |
Each DSU is equal in value to a share of GM common stock and is fully vested upon grant, but does not have voting rights. To calculate the number of DSUs to be granted, we divide the amount of compensation required or elected to be deferred each calendar year under the Director Compensation Plan by the average daily closing market price of our common stock for that calendar year. For a director who joined or retired from the Board during the calendar year, the retainer fee is prorated and converted to DSUs based on the average daily closing market price of our common stock for the period of service. All DSUs granted are rounded up to the nearest whole share. Any portion of the retainer that is deferred into DSUs may also earn dividend equivalents, which are credited at the end of each calendar year to each director’s account in the form of additional DSUs. DSUs under this plan will not be available for disposition until after the director retires or otherwise leaves the Board. After leaving the Board, the director will receive a cash payment or payments under this plan based on the number of DSUs in the director’s account, valued at the average daily closing market price for the quarter immediately preceding payment. Directors will be paid in a lump sum or in annual installments for up to five years based on their deferral elections. All DSUs granted are rounded up to the nearest whole unit. Any portion of the retainer that is deferred into DSUs may also earn dividend equivalents, which are credited at the end of each calendar year to each director’s account in the form of additional DSUs. DSUs granted are determined as follows:
u | Other Compensation |
As outlined below, we provide certain additional benefits tonon-employee directors.
| |||
u Company Vehicles | We provide directors with the use of company vehicles to provide feedback on our products as well as enhance the public image of our vehicles. Retired directors also receive the use of a company vehicle for a period of time. Participants are charged with imputed income based on the lease value of the vehicles and are responsible for associated taxes. |
u Personal Accident Insurance |
We provide PAI coverage in the event of accidental death or dismemberment. Directors are responsible for associated taxes on the imputed income from the coverage. |
(1) | Ms. Barra, our sole employee director, does not receive additional compensation for her Board service other than the PAI benefit described above, the value of which is reported for Ms. Barra in the Summary Compensation Table on page 57. |
Non-employee directors are reimbursed for reasonable travel expenses incurred in connection with their duties as directors. In addition, we pay for the cost of personal accident insurance, which provides coverage in the event of accidental death or dismemberment. Directors are responsible for associated taxes on the imputed income from the coverage.
We provide directors with the use of evaluation vehicles to provide feedback on our products as well as to enhance the public image of our vehicles. Directors are charged with imputed income based on the lease value of the vehicles provided and are responsible for associated taxes. Retired directors receive the use of an evaluation vehicle for a limited period of time.
Unless previously employed by the Company, non-employee directors are not eligible to participate in any of the savings or retirement programs for our employees. Other than as described in this section, there are no separate benefit plans for directors.
18 |
Amount of compensation required or elected to be deferred each calendar year under the Director Compensation Plan ÷ Average daily closing market price of our common stock for that calendar year = DSUs Granted
ITEM NO. 1 – ELECTION OF DIRECTORS
2017Non-Employee Director Compensation Table |
This table shows the compensation that eachnon-employee director received for his or her 20152017 Board and Committee service. Amounts reflect partial-year Board service for Mr. Davis, Ms. Gooden, Mr. Isdell and Mr. Jimenez.
Director | Fees Earned or Paid in Cash(1) ($) | Stock Awards(2) ($) | All Other Compensation(3) ($) | Total ($) | Fees Earned or Paid in Cash(1) ($)
| Stock Awards(2) ($)
| All Other Compensation(3) ($)
| Total ($)
| ||||||||||||||||
Joseph J. Ashton | 62,500 | 185,831 | 9,868 | 258,199 | ||||||||||||||||||||
Erroll B. Davis, Jr.(4) | 70,000 | 58,871 | 10,843 | 139,714 | ||||||||||||||||||||
Stephen J. Girsky | 125,000 | 123,898 | 9,868 | 258,766 | ||||||||||||||||||||
Joseph J. Ashton(4)
|
| 142,500
|
|
| 156,336
|
|
| 34,698
|
|
| 333,534
|
| ||||||||||||
Linda R. Gooden(5) | 114,583 | 113,525 | 8,223 | 236,331 |
| 145,833
|
|
| 155,311
|
|
| 22,448
|
|
| 323,592
|
| ||||||||
E. Neville Isdell(6) | 72,500 | 58,871 | 8,143 | 139,514 | ||||||||||||||||||||
Joseph Jimenez(7) | – | 150,460 | 4,934 | 155,394 | ||||||||||||||||||||
Kathryn V. Marinello | – | 247,763 | 9,868 | 257,631 | ||||||||||||||||||||
Joseph Jimenez
|
| 142,500
|
|
| 155,311
|
|
| 24,282
|
|
| 322,093
|
| ||||||||||||
Jane L. Mendillo
|
| 142,500
|
|
| 155,311
|
|
| 11,323
|
|
| 309,134
|
| ||||||||||||
Michael G. Mullen | 140,000 | 123,898 | 9,868 | 273,766 |
| 162,500
|
|
| 155,311
|
|
| 23,428
|
|
| 341,239
|
| ||||||||
James J. Mulva | – | 262,625 | 9,868 | 272,493 |
| 162,500
|
|
| 155,311
|
|
| 36,490
|
|
| 354,301
|
| ||||||||
Patricia F. Russo | 140,000 | 123,898 | 9,868 | 273,766 |
| 162,500
|
|
| 155,311
|
|
| 19,886
|
|
| 337,697
|
| ||||||||
Thomas M. Schoewe | 155,000 | 123,898 | 9,868 | 288,766 |
| 172,500
|
|
| 155,311
|
|
| 30,448
|
|
| 358,259
|
| ||||||||
Theodore M. Solso | – | 545,044 | 9,868 | 554,912 |
| 242,500
|
|
| 155,311
|
|
| 15,490
|
|
| 413,301
|
| ||||||||
Carol M. Stephenson | 74,167 | 185,831 | 9,868 | 269,866 |
| 162,500
|
|
| 155,311
|
|
| 12,782
|
|
| 330,593
|
|
(1) |
|
(2) | Reflects aggregate grant date fair value of DSUs granted in |
(3) | The following table provides more information on the type and amount of benefits included in the All Other Compensation column. |
Director | Aggregate Earnings on Deferred Compensation (a) | Company Vehicles (b) | Other (c) | Total | Director | Aggregate Earnings on Deferred Compensation (a) | Company Vehicles (b) | Other (c) | Total | Company Vehicle Program (a)
| Other (b)
| Total
| Director
| Company Vehicle Program (a)
| Other (b)
| Total
| ||||||||||||||||||||||||||||||||||||||||||||||
Mr. Ashton | – | $ | 9,628 | $ | 240 | $ | 9,868 | Mr. Mullen | – | $ | 9,628 | $ | 240 | $ | 9,868 |
| $34,458
|
|
| $240
|
|
| $34,698
|
| Mr. Mulva
|
| $36,250
|
|
| $240
|
|
| $36,490
|
| ||||||||||||||||||||||||||||
Mr. Davis | $ | 1,095 | $ | 9,628 | $ | 120 | $ | 10,843 | Mr. Mulva | – | $ | 9,628 | $ | 240 | $ | 9,868 | ||||||||||||||||||||||||||||||||||||||||||||||
Mr. Girsky | – | $ | 9,628 | $ | 240 | $ | 9,868 | Ms. Russo | – | $ | 9,628 | $ | 240 | $ | 9,868 | |||||||||||||||||||||||||||||||||||||||||||||||
Ms. Gooden | – | $ | 8,023 | $ | 200 | $ | 8,223 | Mr. Schoewe | – | $ | 9,628 | $ | 240 | $ | 9,868 |
| $22,208
|
|
| $240
|
|
| $22,448
|
| Ms. Russo
|
| $19,646
|
|
| $240
|
|
| $19,886
|
| ||||||||||||||||||||||||||||
Mr. Isdell | – | $ | 8,023 | $ | 120 | $ | 8,143 | Mr. Solso | – | $ | 9,628 | $ | 240 | $ | 9,868 | |||||||||||||||||||||||||||||||||||||||||||||||
Mr. Jimenez | – | $ | 4,814 | $ | 120 | $ | 4,934 | Ms. Stephenson | – | $ | 9,628 | $ | 240 | $ | 9,868 |
| $24,042
|
|
| $240
|
|
| $24,282
|
| Mr. Schoewe
|
| $30,208
|
|
| $240
|
|
| $30,448
|
| ||||||||||||||||||||||||||||
Ms. Marinello | – | $ | 9,628 | $ | 240 | $ | 9,868 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Ms. Mendillo
|
| $11,083
|
|
| $240
|
|
| $11,323
|
| Mr. Solso
|
| $15,250
|
|
| $240
|
|
| $15,490
|
| |||||||||||||||||||||||||||||||||||||||||||
Mr. Mullen
|
| $23,188
|
|
| $240
|
|
| $23,428
|
| Ms. Stephenson
|
| $12,542
|
|
| $240
|
|
| $12,782
|
|
(a) | Company vehicle program includes the estimated annual lease value of the Company vehicles driven by directors. We | |
Reflects cost of premiums for providing personal accident insurance (annual premium cost of $240 is prorated, as applicable, for period of service). In addition, Mr. Solso received tickets to attend a special event; the tickets had no incremental cost to the Company. | |
(4) | Mr. |
(5) | Ms. Gooden |
19 | ||||
Director Stock Ownership and Holding Requirements
We believe significant stock ownership by our directors is another way to align directors’ interests with those of our shareholders. The Board’s Corporate Governance Guidelines establish a stock ownership requirement for non-employee directors intended to enhance the link between the interests of GM’s directors and shareholders. In 2015, our Board adopted a separate policy on director stock ownership and holding requirements. Under this policy, non-employee directors are prohibited from selling any GM securities or derivatives of GM securities such as DSUs while they are members of the Board. This prohibition does not apply to any GM securities or derivatives acquired by a director in compensation for previous service as an employee of the Company. Each non-employee director is required to own our common stock or DSUs with a market value of at least $400,000. Each director has up to five years from the later of the original effective date of the requirement, January 1, 2011, or the date he or she is first elected to the Board to meet this ownership requirement. As of December 31, 2015, all of our directors were in compliance with the director stock ownership requirement, except for Ms. Gooden and Messrs. Ashton and Mullen, each of whom have less than five years of service on the Board. Ownership guidelines are reviewed each year to confirm they continue to be effective in aligning the interestsRole of the Board and our shareholders.of Directors
GM is governed by a Board of Directors and Committees of the Board that meet throughout the year. The Board is elected by shareholders to oversee and provide guidance on the Company’s business and affairs. The BoardIt is the ultimate decision-making body of the Company, except for those matters reserved tofor shareholders. The Board oversees management’s activities in connection with proper safeguarding of the assets of the Company, maintenance of appropriate financial and other internal controls, and compliance with applicable laws and regulations and proper governance. The Board is highlyactively engaged in the process of strategic development and oversight of ongoing execution of the Company’s strategic plan. It oversees management’s activities in connection with proper safeguarding of the assets
of the Company, maintenance of appropriate financial and other internal controls, compliance with applicable laws and regulations, and proper governance. The Board is committed to sound corporate governance policies and practices that are designed and routinely assessed to enable the Company to operate its business responsibly, with integrity, and to position GM to compete more effectively, sustain its success, and build long-term shareholder value.
The Board of Directors sets the number of directors from time to time by resolution adopted by a majority of the Board. The Board of Directors is currently composed of 1211 members. The Governance Committee reassesses the suitability of the Board’s size at least annually and has concluded that the Board’s current size is appropriate.annually. The Board has the flexibility to increase or reducedecrease the size of the Board, based upon prevailing facts and circumstances.as circumstances warrant. If any nominee
is unable to serve as a director or if any director leaves the Board between annual meetings,Annual Meetings, the Board, by resolution, may reduce the number of directors or elect an individual to fill the resulting vacancy. If all of the Board’s nominees are elected, the Board will be composed of 1211 members immediately following the Annual Meeting.
“Winning With Integrity” and Code of EthicsBusiness Conduct and Ethics: “Winning with Integrity”
The Board is committed to the highest legal and ethical standards in fulfilling its responsibilities. We have adopted a code of business conduct and ethics, “Winning With Integrity: Our Values and Guidelines for Employee Conduct,with Integrity,” that applies to our directors, officers, and employees. “Winning with Integrity” forms the foundation for compliance with corporate policies and procedures and creates a Company-wide focus on uncompromising integrity in every aspect of our operations. The code is available onembodies our website atwww.gm.com/investor,under “Corporate Governance”expectations for a number of topics, including workplace and is available in print upon request. We will post any updatesvehicle safety, conflicts of
interest, protection of confidential information, insider trading, competition and fair dealing, human rights, community involvement and corporate citizenship, political activities and lobbying, preservation and use of Company assets, and compliance with all laws and regulations applicable to the code onconduct of our website.business. Employees are expected to report any conduct that they believe in good faith to be an actual or apparent violation of the code.
Corporate Governance Guidelines
OurYour Board has adoptedoversees a governance structure that it believes promotes the best interests of our shareholders. The Board’sOur Corporate Governance Guidelines form a transparent framework for the effective governance of the Company. The Corporate Governance Guidelines address matters such as the respective roles and responsibilities of the Board and management, the Board’s leadership structure, the responsibilities of the Independent Lead Director, director independence, the Board membership criteria, Board Committees, and Board and CEO evaluation. The Governance Committee regularly considersreviews the Board’s Corporate Governance Guidelines and periodically recommends to ouryour Board the adoption of amendments in response to changing regulations, evolving best practices, and shareholder concerns. Our Corporate Governance Guidelines, CertificateFor a summary of Incorporation, Bylaws, Board Committee Charters, and other governance materials are available on our website atwww.gm.com/investorunder “Corporate Governance.” To obtain a copy of these materials, see“How can I obtain the Company’s corporate governance information?”best practices, see“Proxy Statement Summary—Governance Highlights” on page 74.3.
Our code of business conduct and ethics, “Winning with Integrity,” and Corporate Governance Guidelines and are available on our website at: | |||
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The Board’sGM’s Corporate Governance Guidelines define our standards for director independence and are based on all applicable New York Stock Exchange (“NYSE”) and U.S. Securities and Exchange Commission (“SEC”) requirements. At leasttwo-thirds of our directors are and must continue to be independent under these standards. The Governance Committee annually assesses the independence of each director applying the criteria in our Corporate Governance Guidelines, and makes recommendations to the Board. For a director or director nominee to be “independent,” the Board must affirmatively determine that the director has no material relationship with the Company other than his or her service as a director. In addition, members of the Audit and Compensation Committees must meet heightened independence standards under applicable under NYSE and SEC rules, which provide that they may not be affiliates and may not accept directly or indirectly any consulting, advisory, or other compensatory fee from the Company or any of its subsidiaries other than their compensation for service as directors.
rules.
Consistent with thethese standards, described above, the Board has reviewed all relationships between the Company and each director and director nominee, consideringconsidered all relevant quantitative and qualitative criteria, andcriteria. The Board has affirmatively has determined that all directors and director nominees other than Mr. Ashton, Mr. Girsky, andare independent, except Ms. Barra, are independent. Mr. Ashton is not independent because of his long-term affiliation with the UAW and the ties between the Company and the UAW. Mr. Girsky is not independent because of his former employment with the Company. Ms. Barra is not independent because she currently holds the position ofwho serves as CEO.
In recommending to the Board that it determine each non-employee director and director nominee be foundis independent, the Governance Committee considered whether there were any other facts or circumstances that might impair a director’s independence. In particular, the Governance Committee evaluated charitable contributions that GM (including the GM Foundation) has made to nonprofit organizations with which our directors are or have been associated. None of these transactions waswere material to either GM or the director or director nominee.director. The Governance Committee also considered that GM, in the ordinary course of business, during the last three years, has sold fleet vehicles to and purchased products and services from companies at which some of our directors serveas non-employee directors. directors or executives. The Board determined that these transactions were not material to GM or the other companies involved and that none of our directors had a material interest in the transactiontransactions with these companies. In each case, these transactions were in the ordinary course of business for GM and the other companies involved and were on terms and conditions available to similarly situated customers and suppliers. Therefore, they did not impair the respectivesuch director’s independence.
OurYour Board has the flexibility to decide when the positions of Chairman and Chief Executive OfficerCEO should be combined or separateseparated and whether an executive or an independent director should be Chairman. This approach is designed to allow the Board to choose the most appropriate leadership structure for the Company tothat will best serve the interests of our shareholders at the relevantany particular time.
In January 2016, the Board recombined the positions of Chairman and CEO under the leadership of Ms. Barra and designated Mr. Solso as Independent Lead Director. The Board determined that this structure provides a clear and unified strategic vision for GM during a time of unprecedented industry change. AsFor 2018, our independent directors unanimously voted to appoint Mr. Solso as the individual with primary responsibility for managing the Company, Ms. Barra’s in-depth knowledge of our businesses and understanding of day-to-day operations brings focused leadership to our Board. The structure also reinforces accountabilityIndependent Lead Director for the Company’s performance.
Board Oversight
third consecutive year. The Board’s key duties include strategic,oversight of strategy, risk management, and legal and regulatory compliance and governance oversight, as well as CEO succession.succession planning. In each of these areas, the Board determined that a combined role of Chairman and CEO, with the presence of a strong Independent Lead Director and governance best practices, is the rightoptimal Board leadership structure for GM at this time. Further, ourMr. Solso’s perspective on your Board’s key Committees, Audit, Executive Compensation, and Governance and Corporate Responsibility are composed of all independent directors.leadership structure is provided on the following page.
Long-Term Strategic Vision
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A Message from the Independent Lead Director on Your Board’s Leadership Structure
As the Independent Lead Director, I regularly engage with GM’s investors and other key stakeholders on a variety of issues, including GM’s corporate governance structure and practices and, importantly, your Board’s leadership structure. I want to share with you the same message I deliver during these engagements.
Mary Barra Is the Right Person to Lead Your Board
Your Board carefully considers the appropriate leadership structure for GM and its shareholders on an annual basis and determines whether to combine or split the roles of Chairman and CEO. Your Board believes that Ms. Barra and her leadership team developed a clear strategic vision to lead the Company into a new era of mobility, positioning GM to grow in this period of rapid change and disruption. AsBarra’s service as both Chairman and CEO has provided, and continues to provide, a clear and unified strategic vision for GM during this time of unprecedented industry change. As the individual with primary responsibility for managing the Company, Ms. Barra is ableBarra’sin-depth knowledge of our business and understanding of GM’sday-to-day operations brings focused leadership to focus the Board’s oversight of management’s execution of this strategy in an efficient and streamlined manner and bring pressing issues before the independent directors expeditiously.
Compliance
Ms. Barrayour Board. She has been a key leader as the Company haswe have reset itsour culture of safety and focusesrelentlessly focused on putting the customer at the center of everything we do. As Chairman, she is able to facilitate thefacilitates your Board’s continued strong oversight of compliance and enterprise risk management programs. For example, under her leadership, in 2017 the Board established a new Cybersecurity Committee to enhance the Board’s oversight of GM’s evolving cybersecurity risks.
Your Board Is Independent and Holds Management Accountable
GovernanceWith 10 of 11 directors being independent, your Board holds management accountable. We have the right mix of skills, qualifications, and experiences to oversee, guide, and challenge the leadership team. We are engaged in shaping and overseeing GM’s strategy. Strategy is a part of every Board meeting, and every year your Board holds a multiday session devoted exclusively to GM’s strategic plan. During these discussions, Board members engage in active debate and dialogue, challenge and validate management assumptions, and shape various aspects of management’s strategy and execution.
Our independent directors demonstrateMy Role as the objective thinking that is expected of boards today. And our Independent Lead Director Mr. Solso, is a proven leader with an objective viewpoint. When
I strive to complement Ms. Barra’s role as Chairman by providing strong independent leadership in my role as the Board appointed Mr. Solso as Independent Lead Director, it also strengthenedwith the responsibilities of Lead Director to include additionalfollowing key duties to further promote independent, objective oversight. The duties of our Independent Lead Director are set forth below.and responsibilities:
Succession Planning
CEO succession planning is conducted annually by the full Board and led by the Lead Director. This fundamental Board process will remain very robust through the change in Board leadership under Mr. Solso.
Enhanced Responsibilities of Independent Lead Director
If a GM executive holds the position of Chairman, our independent directors, by the affirmative vote of a majority of all independent directors, designate one of our independent Board members to serve as Independent Lead Director. The duties and responsibilities of our Independent Lead Director, Mr. Solso, include the following:
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Advising on the scope, quality, quantity, and timeliness of the flow of information between management and the Board and approving Board meeting agendas and materials recommended by the Chairman; |
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u | Serving as a liaison between independent directors and the Chairman when requested to do so by independent directors (although all |
u | Interviewing, along with the Chair of the Governance Committee, all Board candidates and making recommendations to the Governance Committee and the Board; |
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As always, I am proud to work closely with our Chairman and CEO and my fellow independent directors as we drive long-term shareholder value. On behalf of the entire Board, thank you for your continued support.
Theodore M. Solso Independent Lead Director |
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CORPORATE GOVERNANCE
Our non-managementIndependent directors have an opportunity to meet in executive session without management present as part of each regularly scheduled Board meeting. Executive sessions are chaired by the Independent Lead Director, Mr. Solso.
During executive sessions, non-management directors (orthe independent directors as appropriate)may review CEO performance, compensation, and succession planning; strategy; risk; future Board agendas and flow of information to directors; the Board’s corporate governance matters; and any other matters of importance to the Company raised during a meeting or otherwise or other issues presented by non-managementthe independent directors.
Thenon-management directors of the Board met in executive session six times in 2015,2017, including one time with only independent directors present.
OurYour Board of Directors has sixseven standing Committees: Audit, Cybersecurity, Executive Compensation, Finance, Governance, and Corporate Responsibility, Risk, and Executive. As a best practiceThe key responsibilities, recent activities, and focus areas of each Committee are set forth below, together with their current membership and the number of meetings held in 2017. Each Committee Chair meets regularly with management during the year to maximize the effectiveness of thediscuss Committee business, shape agendas, and facilitate efficient meetings. The Independent Lead Director, role, Mr. Solso, attends all Committee meetings of the standing Committees of which he is not a member and servesto serve as a resource forand identify topics requiring the Committees as needed.
GM’s Public Policy Committee was dissolved on June 9, 2015, at which time the Directors and Corporate Governance Committee was renamed the Governance and Corporate Responsibility Committee, and the charters of the Governance and Corporate Responsibility, Risk, and Executive Compensation Committees (“Compensation Committee”) were revised to incorporate responsibilities previously undertaken by the Public Policy Committee.
Eachfull Board’s attention. The Board has determined that each member of the Audit, Compensation, Governance, Cybersecurity, Finance, and GovernanceRisk Committees has been determined by the Board to beis independent according to NYSE listing standards and our Corporate Governance listing standards. The compositionGuidelines.
In November 2017, the Board formed the Cybersecurity Committee, at which time the Risk Committee and Audit Committee charters were revised to reflect the transfer of eachcybersecurity oversight responsibilities. For additional information about our new Cybersecurity Committee, also complies with the listing requirementssee “Corporate Governance—Board and other rulesCommittee Oversight of the Toronto Stock Exchange. The following outlines the key responsibilities and 2015 accomplishments of each standing Committee. Each Committee has a charter governing its activities. Further details are availableRisk” on our website atwww.gm.com/investor, under “Corporate Governance.”page 27.
Each Committee has a charter governing its activities. Committee charters are available on our website at:gm.com/investors/corporate-governance. |
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Thomas M. Schoewe, Chair | Members:Thomas M. Schoewe (Chair), Linda R. Gooden,
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| Members: Linda R. Gooden (Chair), Michael G. Mullen, and Thomas M. Schoewe Meetings held in 2017: 2 | ||||||
Key Responsibilities
u Reviews the scope and effectiveness of the Company’s compliance and ethics programs;
u Regularly meets in private sessions with the General Counsel, Chief Compliance Officer, General Auditor and independent auditor;
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Our Board has determined that each member of the Audit Committee is independent under the NYSE listing standards and the heightened independence requirements applicable to audit committee members under SEC rules. The Board has also determined that all members of the Audit Committee are financially literate in accordance with the NYSE listing standards and that Ms. Gooden, Ms. Marinello,that Ms. Gooden, Ms. Mendillo, and Mr. Schoewe are each qualified as an “audit committee financial expert” as defined by the SEC.
For additional information about the Audit Committee and its 2017 activities, see its report included in this Proxy Statement beginning on page 70. |
u Oversees the effectiveness of the Company’s cybersecurity programs and its practices for identifying, assessing, and mitigating cybersecurity risks; u Reviews the Company’s controls to prevent, detect, and respond to cyberattacks and breaches involving GM’s electronic information, intellectual property, sensitive data, connected products, and the connected ecosystem; u Oversees management’s implementation of cybersecurity programs and risk policies and procedures and management’s actions to safeguard their effectiveness; and u Evaluates the Company’s cyber crisis preparedness, incident response plans, and disaster recovery capabilities. |
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Recent Activities and Key Focus Areas Conducted competitive request for proposal process to select the Company’s new independent auditor, Ernst & Young LLP Examined the impact of the enactment of U.S. tax reform legislation Prepared for adoption of new revenue recognition standard Reviewed internal controls over financial reporting to maintain world-class control environment Recent Activities and Key Focus Areas Evaluated GM’s key cybersecurity risks and enterprise and product cybersecurity programs Approved ransomware policy and countermeasures Oversaw management’s optimization of GM’s cybersecurity function
CORPORATE GOVERNANCE
Chair | Members:Carol M. Stephenson (Chair), Joseph Jimenez, James J. Mulva, and Patricia F. Russo
Meetings held in | |||||||
| Members:James J. Mulva (Chair), Jane L. Mendillo, Patricia F. Russo, and Thomas M. Schoewe Meetings held in 2017: 4 | |||||||
Key Responsibilities
The Board has determined that all members of the
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Our Board has determined that each member of our Executive Compensation Committee is independent in accordance with NYSE listing standards and our corporate governance guidelines, as well as additional independence standards applicable to Compensation Committee members.
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Our Board has determined that each member of our Governance and Corporate Responsibility Committee is independent in accordance with the NYSE listing standards and our corporate governance guidelines.
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Recent Activities and Key Focus Areas Modified GM’s long-term and short-term incentive compensation plans to incorporate shareholder feedback and current best practices Enhanced focus on sustainability in compensation decisions following shareholder feedback Shareholder engagement designed to solicit continued input on GM’s compensation structure Recent Activities and Key Focus Areas Continued to oversee GM’s Capital Allocation Strategy, including management’s decisions to exit GM Europe as well as franchises in South Africa and East Africa and to discontinue retail sales in India Adopted enhanced cash management policies to optimize utilization of GM’s liquidity Monitored continued efforts to deliver world-class cost performance Oversaw GM Financial’s continued execution of its full captive strategy
CORPORATE GOVERNANCE
Patricia F. Russo, Chair
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All members of the Finance Committee are non-employee directors, a majority of whom have been determined by our Board to be independent in accordance with the NYSE listing standards and our corporate governance guidelines.
Adm. Michael G. Mullen, Chair | Members:Michael G. Mullen (Chair),
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u Oversees Company policies and strategies related to corporate responsibility, sustainability, and political contributions;
u | Key Responsibilities u Assists the Board in its oversight of the Company’s risk management framework and practices;
u Reviews management’s evaluation of strategic and operating risks, including risk concentrations, mitigating measures and the types and levels of risk that are acceptable in the pursuit and protection of shareholder value;
u Reviews risks related to the Company’s public policy positions in the United States and internationally. |
EXECUTIVE
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All members of the Risk Committee are non-employee directors, a majority of whom have been determined by our Board to be independent in accordance with the NYSE listing standards and our corporate governance guidelines.
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Recent Activities and Key Focus Areas Continued board succession planning with recruitment of Devin N. Wenig, who brings key technology and consumer-facing expertise to complement the Board’s current mix of skills and capabilities, which will help the Company compete in a rapidly changing industry Managed Director-Shareholder engagement program that facilitated important feedback to the Board Oversaw ESG strategy to improve GM third-party rankings and performance Reviewed U.S. corporate political contributions as well as GM PAC contributions and expenditures. Recent Activities and Key Focus Areas Reinforced enterprise-wide objective of best-in-class workplace safety Conducted review of key strategic and cross-functional risks, including vehicle safety; emissions and fuel economy compliance; global product portfolio; product quality; and workplace culture Evaluated key public policy, geopolitical, and region-specific risks and reviewed mitigating actions taken by management to protect shareholder value Reviewed results of the annual enterprise risk assessment, including determination of enterprise risk focus for 2018
CORPORATE GOVERNANCE
The Board and each Board Committee can select and retain the services of outside advisors at ourthe Company’s expense.
Board and Committee Meetings and Attendance
In 2015, our2017, your Board held a total of 1210 meetings, and average director attendance at Board and Committee meetings was 95 percent.97%. Each director standing forre-election attended at least 80 percent90% of the total meetings of the Board and Committees on which he or she served during the periods that he or she served in 2015.2017. Directors are expected to attend our annual meetingAnnual Meeting of shareholders, which is held in conjunction with a regularly scheduled Board meeting. All of GM’s directors standing for re-electionin office at such time attended the 20152017 Annual Meeting.
Board and Committee Oversight of Risk
One of the essential functions of our Board is oversight of management, directly and through its various Committees. Identifying and managing the risks we face is an important component of management’s responsibilities. Risks are considered in virtually every business decision and as part of the Company’s business strategy. We recognize that it is neither possible nor prudent to eliminate all risk. Indeed, purposeful and appropriate risk-taking is essential for the Company to be competitive on a global basis and to achieve our strategic objectives.
OurYour Board has the overall responsibility for risk oversight, with a focus on the most significant risks facing the Company. Effective risk management is the responsibility of the CEO and other members of the Company’s management, specifically the ExecutiveSenior Leadership Team. As part of the risk management process, each of the Company’s business units and functions is responsible for identifying risks that could affect the achievement of business goals and strategies, assessing the likelihood and potential impact of significant risks, and prioritizing the risks and actions to be taken to mitigate such risks, as appropriate.
OurYour Board implements its risk oversight function both as a whole and through delegation to Board Committees, particularly the Risk Committee. The Board receives regular reports from our management on particular risks within the Company, through review of the Company’s strategic plan and through regular communication with its Committees. At least annually, managementManagement provides a comprehensive reportreports to the BoardRisk Committee on the key strategic, operating, vehicle, and workplace safety, financial, and compliance risks facing the Company, including management’s response to managing and mitigating such risks, as appropriate.
The Company’s Chief Compliance Officer also regularly reports to the Audit Committee.
The Chair of the Risk Committee coordinates with the Chairs of the other Board Committees in their review of the Company risks that have been delegated to these Committees to support them in coordinating the relationship between risk management policies and practices and their respective oversight accountabilities. Each of the other Board Committees, which meet regularly and report back to the Board, is responsible for oversight of risk management practices for categories of risks relevant to its functions. In general, the Board Committees oversee the following risks:
OurYour Board believes that its structure for risk oversight provides for open communication between management and the Board and its various committees,Committees, which effectively supports management’s enterprise risk management programs. In addition, strong independent directors chair the various committeesCommittees involved in risk oversight, and all directors are involved in the risk assessment and ongoing risk reviews.
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Succession Planning and Leadership Development
One of ouryour Board’s primary responsibilities is to confirm that we haveoversee the development of appropriate managementexecutive-level talent to successfully pursue our strategies.execute GM’s strategy. Management succession is regularly discussed by the directors with the CEO and during the Board’s executive sessions. The Board reviews candidates for all senior managementexecutive positions to confirm that qualified candidatessuccessor-candidates are available for all positions and that development plans are being utilized to strengthen the skills and qualifications of candidates.successor-candidates. Our Independent Lead Director oversees the process for CEO succession and leads, at
least annually, the Board’s discussion of CEO succession planning. Our CEO provides the Board with recommendations for and evaluations of potential CEO successors and reviews with the Board development plans for these successors. Directors engage with potential CEO and senior management talent at Board and Committee meetings and in less formal settings to enable directors to personally assess candidates. The Board reviews management succession in the ordinary course of business as well as to conduct contingency planning in the event of an emergency or unanticipated event.
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Board and Committee Evaluations
The Board and each Committee conductconducts an annual self-evaluation to assess their effectiveness and consider opportunities for improvement. This process, overseen by the Governance Committee, also assesses the qualifications, skills, and experience of each director. As part of the evaluation process, each director completes a written questionnaire and is also interviewed by the Chairman and, if requested or needed, the Independent Lead Director, to provide feedback on the effectiveness of the Board, our Committees, and the contributions of individual directors.Director. The results of the written questionnaires are compiled anonymously by the Corporate Secretary in the form of summaries for the full Board and each Committee. The feedback received from the questionnaires and interviews is reviewed and discussed by the Governance Committee (as it relates to both the Board and all Committees) and each other Committee (as it relates to such Committee). Following review and discussion by the Committees, the Chairman and the Chair of the Governance Committee summarize the results of the evaluations and report to the full Board for discussion and action.any action items. In addition, the Chairman and, if applicable, the Independent Lead Director, providesprovide feedback from the individual director interviews to the full Board.
Matters considered in evaluations include the following:
uThe effectiveness of the Board’s leadership | ||||
uBoard and Committee skills, composition, and diversity and Board succession planning; | ||||
uBoard and Committee culture and dynamics, including the effectiveness of discussion and debate at Board and Committee meetings; | ||||
uThe quality of Board and Committee agendas and the | ||||
uDynamics between the Board and management, including the quality of management presentations and information provided to the Board and Committees; and | ||||
uThe |
OUR NEW CYBERSECURITY COMMITTEE Your Board recognizes that cybersecurity is critical to GM’s operations – particularly as management continues to execute on its future mobility strategies, such as self-driving vehicles and connected-vehicle technology. GM must ensure that customer and other sensitive data is secure and take proactive steps to protect its products and intellectual property against cyberattacks. In 2017, your Board created a standalone Cybersecurity Committee to enhance its oversight of these cyber risks. Your Board tasked this new Committee with several key risk oversight responsibilities related to the Company’s cybersecurity programs, including oversight of the: practices, procedures, and controls management uses to identify, assess, and manage its key cybersecurity programs and risks; protection of the confidentiality, integrity, and availability of sensitive information, intellectual property, and GM customer data; anDd security of GM products. Your Board believes the Cybersecurity Committee will be a critical asset as cybersecurity becomes increasingly important to GM.
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The CEO reports annually to the Board regarding achievement of previously established goals and objectives. Thenon-management directors, meeting separately in executive session, annually conduct a formal evaluation of the CEO, which is communicated to the CEO by the Independent Lead Director. The evaluation is based on both objective and subjective criteria, including, but not limited to: the Company’s financial performance, accomplishment of ongoing initiatives in
furtherance of the Company’s long-term strategic objectives, and development of the Company’s top management team. The results of the evaluation are considered by the Compensation Committee in its deliberations when determining the compensation of the CEO, as further described in the “Compensation Discussion and Analysis” section in this Proxy Statement.“Executive Compensation” on page 35.
Director Orientation and Continuing Education
All new directors participate in the Company’s director orientation program, which generally commences promptly after the meeting at which a new director is elected. The Governance Committee oversees anthis orientation process developed by managementprogram to familiarizeon-board new directors through a review of background material and meetings with senior management,management. The orientation also includes tours of GM plant(s), the Design Studio at the Warren Technical Center, dealer visits and/or auto show events. The orientation enables new directors to become familiar with the Company’s business and strategic plans,plans; significant financial matters; core values, including ethics, compliance programs, and corporate governance practices; and other key policies and practices.practices, including, but not limited to,
sustainability, vehicle and workplace safety, public policy and governance relations, risk management, and investor relations.
Continuing education opportunities are provided to keep directors updated with information about the Company and its strategy, operations, products, and other matters relevant to Board service. Board members are encouraged to visit GM facilities, dealers, and auto shows, and other key corporate and industry events to enhance their understanding of the Company and its competitors in the auto industry. AllIn addition, all directors are encouraged to attend, at our expense, director continuing education programs sponsored by governance organizations and other institutions.
In 2015, as part of the Company’s comprehensive review of its governance practices and policies, the Board adopted a written policy recommended by the Governance Committee to build upon current practices and expectations set forth in the Board’s Corporate Governance Guidelines regarding the orientation process for newly appointed directors and ongoing director education. The objective of the policy is to keep directors updated with information about the Company and its operations, corporate governance, and other matters relevant to board service. Consistent with prior practices, the Governance Committee annually reviews each director’s orientation and external education activities.
Director Service on Other Public Company Boards
The Board recognizes that service on other public company boards provides valuable governance and leadership experience that benefits the Company. The Board also believes, however, that it is critical that directors dedicate sufficient time to their service on the Company’s Board. Directors shouldare expected to advise the Chairman of the Board, Independent Lead Director, or Chair of the Governance Committee in advance of accepting an invitation to serve on another board of directors or any audit committee of another public company board. This provides an opportunity to assess the impact of joining another board, based on various factors relevant to the specific situation, including the nature and extent of a director’s other professional obligations and the time commitment attendant to the new position. Directors who are engaged in active, full-time employment, for example, would have less time to devote to Board service than a director who exclusively serveswhose principal occupation is serving on boards.
Our Corporate Governance Guidelines provide that without obtaining the approval of the Board:
A director may not serve on the boards of more than four other public companies (excluding nonprofits and subsidiaries); and |
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No member of the Audit Committee may serve on more than two other public company audit committees. |
All directors are in compliance with this policy.
In general, senior members of management may not serve on the board of more than one other public company orfor-profit entity and must obtain the approval of the Governance Committee prior to accepting an invitation to serve on an outside board.
Compensation Committee Interlocks and Insider Participation
During 2015,2017, and as of the date of this Proxy Statement, none of the members of the Compensation Committee was or is an officer or employee of the Company, and no executive officer of the Company served or serves on the compensation committee or board of any company that employed or employs any member of the Company’s Compensation Committee or Board of Directors.
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CORPORATE GOVERNANCE
A priority for the Board is to meet with and hear from shareholders. This dialogue helps the Board and the senior management team gain feedback on a variety of topics, including strategic and financial performance, operations, products, executive compensation, Board composition, and leadership structure as well as important environmental and social issues. The constructive insights, experiences, and ideas exchanged during these engagements enable your Board to further evaluate and assess key initiatives from different perspectives and viewpoints.
DIRECTOR-SHAREHOLDER ENGAGEMENT POLICY (adopted in 2016) u Frequent and u Shareholders and analysts invited to Board meetings on an annual basis During 2017, members of the Board, including our Independent Lead Director, metin-person with shareholders representing approximately 25% of shares outstanding. | During 2017, one or more members of management were involved in more than 75in-person and telephonic meetings on these topics with investors representing more than 45% of shares outstanding. The common themes we heard in 2017 that led to boardroom discussion and action included the following: | |||||
Message | Actions | |||||
Received positive feedback regarding the quality and diversity of the Board. | See pages 7–9 for additional information on why we have the right Board at the right time for GM. | |||||
Encouraged to enhance our Audit Committee report in the Proxy Statement. | See page 70 for the 2017 audit committee report. | |||||
Encouraged to enhance transparency about the Board’s role in overseeing cybersecurity. | See pages 27–28 for insights on the Board’s new Cybersecurity Committee. | |||||
Encouraged to include safety and ESG/ sustainability metrics in executive compensation decisions. | See page 6 for insights into sustainability commitments and performance and pages 48–51 for achievements by our key executives. | |||||
Find more online. Instructions on contacting our Board of Directors is available on our website at:gm.com/investors/corporate-governance. |
OurYour Board is committed to governance policiesstructures and practices that increase shareholder value and protect important shareholder rights. Our Governance Committee regularly reviews these policies and practices. Among the policiesstructures and practices, which include the Board believes demonstrate the Company’s commitment to protecting shareholder rights are:following:
u | Supermajority of independent directors serving on the Board, with |
Annual election of all directors; |
u | One-share,one-vote standard; |
u | Majority voting standard for the election of directors in uncontested elections (plurality voting standard in contested elections), coupled with a director resignation policy; |
Shareholder right to call for a special meeting; | ||
Proxy access permitting a shareholder, or a group of up to 20 shareholders owning at least | ||
No poison pill; |
u | Executive sessions without management present; and |
u | Director-Shareholder Engagement Policy that contemplates proactive and productive engagement with shareholders. |
Shareholder Communication With the Board
Shareholders and other interested parties may contact our Board as a whole, the non-management directors as a group, any Board Committee, the Chairman of the Board, the Lead Director, or any director by using contact information provided on our website atwww.gm.com/investor, under “Corporate Governance.”
30 |
CORPORATE GOVERNANCE
Certain Relationships and Related Party Transactions
Our policy is thatcode of business conduct and ethics, “Winning with Integrity,” requires all of our employees and directors mustto avoid any activity that is in conflict with our business interests. OurIn addition, your Board of Directors has adopted the Related Party Transactions Policy, a written policy regarding the review and approval or ratification of “related party transactions.” Under the Related Party Transactions Policy, which is administered by our Governance Committee, directors and executive officers must report any potential related party transactions (including transactions involving immediate family members of directors and executive officers) to the General Counsel or Corporate Secretary to determine whether the transaction constitutes a related party transaction.
For purposes of our Related Party Transactions Policy, a related party transactions aretransaction includes transactions in which our Company is a participant, the amount involved exceeds $120,000, and a “related party” has or will have a direct or an indirect material interest. Related parties of our Company consist of directors (including nominees for election as directors), executive officers, shareholders beneficially owning more than 5 percent5% of the Company’s voting securities, (“Significant Shareholders”), and the immediate family members of these individuals.
During 2015, the Governance Committee reviewed and revised the Related Party Transactions Policy to provide that all related party transactions be referred to the Governance Committee for review and approval or ratification. Previously, related party transactions involving executive officers other than the CEO or the General Counsel and their immediate family members were referred to the General Counsel for review and approval or ratification.
Each director and executive officer is responsible for providing written notice to the General Counsel of any potential related party transaction involving him or her or his or her immediate family member, including any additional information about the transaction that the General Counsel or Corporate Secretary may reasonably request for review by the Governance Committee. The Governance Committee will determine whether the transaction does, in fact, constituteOnce a related party transaction requiring compliance with this policy, in consultation with the General Counsel or Corporate Secretary and outside counsel, as appropriate.
In addition, each director and executive officer is required to complete an annual questionnaire that requests information about their immediate family members and any current, past, and proposed related party transactions. This questionnaire also includes a reminder of each directors’ obligations under the Related Party Transactions Policy.
To review a related party transaction,has been identified, the Governance Committee will be provided withreview all relevant material information of the related party transaction, including the terms of the transaction, the business purpose of the transaction, the benefits to the Companyrelevant facts and to the related party,circumstances and any other relevant matters. In determining whether to approve or ratify a related party transaction,disapprove entry into the Governance Committee will consider the following factors, among others, to the extent they are relevant to the related party transaction:transaction.
Find more online. Our Related Party Transactions Policy is available on our website at:gm.com/investors/corporate-governance. |
u | Factors Used in Assessing Related Party Transactions |
u | Whether the terms of the related party transaction are fair to the Company and |
Whether there are any compelling business reasons for the Company to enter into the related party transaction and the nature of alternative transactions, if any; |
Whether the related party transaction would impair the independence of an otherwise independent director; |
u | ||
Whether the Company was notified about the related party transaction before its commencement, and if not, why preapproval was not sought and whether subsequent ratification would be detrimental to the Company; and | ||
Whether the related party transaction would present an improper conflict of interest for any director or executive officer of the Company, taking into account the |
The Governance Committee in its discretion may refer any transaction to the Board for review and approval or ratification. Any member of the Governance Committee who has a potential interest in any related party transaction will recuse himself or herself and abstain from voting on the approval or ratification of the related party transaction, but may participate in all or a portion of the Governance Committee’s discussions of the related party transaction, if requested by the Chair of the Governance Committee.
In any case where the Governance Committee determines not to ratify a related party transaction that has been commenced without approval, the Governance Committee may direct additional actions, including, but not limited to, immediate discontinuation or rescission of the transaction or modification of the transaction to make it acceptable for ratification. The Governance Committee has authority to oversee our Related Party Transactions Policy and to amend it from time to time. In addition, the Governance Committee is responsible for annually reviewing the independence of each director and the appropriateness of any potential related party transaction and related issues. Our Related Party Transactions Policy is available on our website atwww.gm.com/investor, under “Corporate Governance.”
As required under SEC rules, we will disclose all related party transactions in our Proxy Statement. No reportable transactions have occurred since January 1, 2015, or are currently proposed.
The son of John Quattrone, our former Senior Vice President, Global Human Resources, is employed by the Company in anon-executive position and in 2017 received compensation of approximately $133,000 and customary Company benefits. His total compensation is similar to the total compensation provided to other employees of the same level with similar responsibilities. The terms of his employment with GM were approved by the Governance Committee pursuant to the Company’s Related Party Transactions Policy.
OurOn March 2, 2018, we repurchased 2,518,257 shares of our common stock from the UAW Retiree Medical Benefits Trust (the “VEBA Trust”), a greater than 5% beneficial owner of GM’s common stock, at a cash price of $39.71 per share, for a total consideration of $100 million (the “Repurchase”). The price paid in the Repurchase represented a 1% discount over the closing price of our common stock on the day the Repurchase was announced. The Repurchase was made pursuant to our previously authorized stock repurchase program and was approved by the Board believes that fostering long-term and enterprise-wide relationships with our shareholders and maintaining their trust and goodwill is a core GM objective. Andpursuant to demonstrate its openness to investor feedback and input, our Board recently adopted a Director-Shareholder Engagement Policy, which contemplates both proactive engagement, inthe Company’s Related Party Transactions Policy.
31 |
which shareholders are identified by the Board for selective engagement, and reactive engagement, with shareholders that seek to provide input to the Board and executive management on various matters. Through this process, GM conducts engagements with key shareholders. These engagements routinely cover governance, compensation, environmental, social, and other current and emerging issues so that the Board and management understand and address the issues that are important to our shareholders.
Since GM’s last Annual Meeting, members of the Board and management have conducted engagements with shareholders representing more than 45 percent of the Company’s outstanding shares. In addition, our management team engaged with shareholders who submitted proposals for inclusion in this Proxy Statement to discuss their concerns and areas of agreement and disagreement. The Company gained valuable feedback during these engagements, and this feedback was shared with the Board and its relevant Committees.
We have a long-standing commitment to our shareholders and communities to operate in an environmentally and socially responsible manner. We continue to take action to reduce our global carbon footprint, optimize the efficiency and safety of our workplace, support our customers in reducing their own environmental footprints, and encourage our suppliers to act in more sustainable ways. To do this, we provide solutions all over the world in the form of improved and new types of products, innovation for existing products and services, and advanced technologies.
Placing the customer at the center of all we do extends to both how we build our products and how we serve and improve our communities. When it comes to sustainability, we pursue outcomes that create value for all of our stakeholders.
Our sustainability strategy is aligned to our business practices and emphasizes:
Some of our 2015 accomplishments include:
To learn more about sustainability at GM and how we, together with our customers and shareholders, are making a difference, please access our Sustainability Report athttp://www.gmsustainability.com.
Our Board has adopted a U.S. Corporate Political Contributions and Expenditures Policy (“Political Contributions Policy”). The Political Contributions Policy, together with other policies and procedures of the Company, guides GM’s approach to political contributions. We participate in the political process to help shape public policy and address legislation that impacts GM, our industry, and our shareholders. GM has a history of supporting and will continue to support public policies that work to drive or are necessary to furthering the achievement of our long-term, sustainable growth. As specified in its Charter, the Governance Committee oversees this policy and annually reviews the Company’s engagement in the public policy process. The Committee also annually reviews all corporate political contributions as well as GM Political Action Committee (“GM PAC”) contributions and expenditures (which are funded entirely by voluntary employee contributions). In keeping with our goal of transparency, our U.S. Corporate Political Contributions and Expenditures Policy and our annual voluntary report of U.S. political contributions are available on our website atwww.gm.com/investor, under “Corporate Governance.” The report includes information about contributions to political organizations known as “section 527 organizations;” corporate contributions to individual candidates for state and local office; and portions of dues or similar payments to trade associations and social welfare organizations, to the extent the dues or other payments equal or exceed $50,000 and are attributable to political purposes. In addition, a link to the Federal Election Commission website is provided, which details employee contributions to the federal GM PAC and the GM PAC’s contributions to candidates, party committees, and other PACs.
SECURITY OWNERSHIP INFORMATION
Security Ownership of Directors, Named Executive Officers, and Certain Other Beneficial Owners
The beneficial ownership as of April 1, 2016,2018, of our common stock by each director, each nominee for election to the Board, each NEO, and all directors and executive officers as a group is shown in the following tables, as well as ownership of Deferred Share UnitsDSUs and Deferred Salary Stock Units. Each of the individuals listed in the following tables owns less than 1 percent1% of the outstanding shares of our common stock; all directors and officers as a group own less than 1 percent1% of the outstanding shares. The persons named have provided this information to us, and we have no reason to believe it is not accurate. None of the shares shown in the following tables as beneficially owned by directors and executive officers is hedged or pledged as security for any obligation.
Non-Employee Directors
Shares of Common | ||||||||||||||||
Stock Beneficially | Deferred Share | |||||||||||||||
Director | Owned | Units(1) | ||||||||||||||
Joseph J. Ashton | 500 | 8,307 | ||||||||||||||
Stephen J. Girsky(2) | 10,300 | 5,326 | ||||||||||||||
Director(1) | Shares of Common Stock Beneficially Owned
| Deferred Share Units(2)
| ||||||||||||||
Linda R. Gooden | 1,000 | 3,426 |
|
1,000
|
|
|
11,994
|
| ||||||||
Joseph Jimenez | 32,330 | 4,510 |
|
32,330
|
|
|
21,248
|
| ||||||||
Kathryn V. Marinello | 800 | 36,891 | ||||||||||||||
Jane L. Mendillo | — | — |
|
4,560
|
|
|
12,607
|
| ||||||||
Michael G. Mullen | 750 | 9,741 |
|
750
|
|
|
19,855
|
| ||||||||
James J. Mulva | 28,343 | 26,006 |
|
28,343
|
|
|
45,774
|
| ||||||||
Patricia F. Russo | 2,300 | 18,449 |
|
12,300
|
|
|
29,362
|
| ||||||||
Thomas M. Schoewe | 7,645 | 15,495 |
|
22,005
|
|
|
25,081
|
| ||||||||
Theodore M. Solso | 5,000 | 34,534 |
|
5,000
|
|
|
61,312
|
| ||||||||
Carol M. Stephenson | 800 | 35,021 |
|
800
|
|
|
51,093
|
| ||||||||
Devin N. Wenig
| — | — |
(1) | c/o General Motors Company, 300 Renaissance Center, Detroit, Michigan 48265. |
(2) | Represents the unit equivalents of our common stock under the Director Compensation Plan described on page 18. |
Named Executive Officers and All Directors and Executive Officers as a Group
Shares of Common Stock | Deferred Salary | |||||||||||||||||||
Name | Beneficially Owned(1) | Stock Units(2) | ||||||||||||||||||
Beneficial Ownership | ||||||||||||||||||||
Name(1) | Shares of Common Stock Beneficially Owned
| Right to
| Total Number of Shares
| |||||||||||||||||
Mary T. Barra | 117,478 | 19,493 |
|
696,981
|
|
|
1,779,360
|
|
|
2,476,341
|
| |||||||||
Charles K. Stevens, III | 46,942 | 343 |
|
102,741
|
|
|
187,062 |
|
|
289,803
|
| |||||||||
Daniel Ammann | 173,850 | 19,391 |
|
259,340
|
|
|
668,306
|
|
|
927,646
|
| |||||||||
Mark L. Reuss | 67,630 | 16,542 |
|
203,934
|
|
|
67,771
|
|
|
271,705
|
| |||||||||
Craig B. Glidden | 21,217 | — | ||||||||||||||||||
All Directors and Executive Officers as a Group (26 persons, including the foregoing) | 651,544 | 313,443 | ||||||||||||||||||
Alan S. Batey
|
|
138,067
|
|
|
162,212
|
|
|
300,279
|
| |||||||||||
Karl-Thomas Neumann
|
|
—
|
|
|
—
|
|
|
—
|
| |||||||||||
All Directors and Executive Officers as a Group (22 persons, including the foregoing)
|
|
1,856,101 |
|
|
3,600,787 |
|
|
5,456,888 |
|
(1) |
|
(2) | Includes shares that the named individual or group has the right to acquire through the exercise of vested Stock Options and shares that the named individual or group has the right to acquire through the vesting of restricted stock units and Stock Options within 60 days of April 1, 2018. |
32 | |||
SECURITY OWNERSHIP INFORMATION
Certain Beneficial Owners
The beneficial ownership as of April 1, 2016,2018, of our common stock by each person or group of persons who is known to be the beneficial owner of more than 5 percent5% of our outstanding shares of common stock on a fully-diluted basis is shown in the following table.
Percent of | ||||||||||||||
Number of | Outstanding | |||||||||||||
Name and Address of Beneficial Owner of Common Stock | Shares(1) | Shares(1) | Number of Shares(1) | Percent of Outstanding | ||||||||||
UAW Retiree Medical Benefits Trust, as advised by its fiduciary and investment advisor Brock Fiduciary Services LLC 200 Walker Street Detroit, MI 48207 | 140,150,000 | 9.1 | % |
|
100,150,000 |
|
|
7.1 |
% | |||||
The Vanguard Group 100 Vanguard Blvd. Malvern, PA 19355 | 82,980,517 | 5.4 | % |
|
87,437,866 |
|
|
6.2 |
% | |||||
Harris Associates L.P. 111 S. Wacker Drive, Suite 4600 Chicago, IL 60606 | 81,083,512 | 5.3 | % | |||||||||||
BlackRock, Inc. 55 East 52nd Street New York, NY 10055
|
|
76,922,292 |
|
|
5.5 |
% |
(1) | Number of |
Entity/ Filing
| Sole Voting Power
| Shared Voting Power
|
Sole Dispositive Power
|
Shared Dispositive Power
| ||||||||||||
UAW Retiree Medical Benefits Trust(a) (Form 4, filed Mar. 5, 2018)
|
|
— |
|
|
100,150,000 |
|
|
— |
|
|
100,150,000 |
| ||||
The Vanguard Group (Sch. 13G, filed Feb. 9, 2018)
| 1,806,486 | 293,363 | 85,419,593 | 2,018,273 | ||||||||||||
BlackRock, Inc. (Sch. 13G, filed Feb. 8, 2018)
|
|
65,871,841 |
|
|
— |
|
|
76,922,292 |
|
|
— |
|
(a) | Pursuant to the Stockholders Agreement dated October 15, 2009, between the Company and the VEBA Trust, the VEBA Trust will vote its shares of our common stock on each matter presented to the shareholders at the Annual Meeting in the same proportionate manner as the holders of our common stock other than our directors and executive officers. The VEBA Trust will be subject to the terms of the Stockholders Agreement until it beneficially owns less than 2% of the shares of our common stock then issued and outstanding. |
Sole Dispositive | Shared Dispositive | ||||||||||||
Entity/ Filing | Sole Voting Power | Shared Voting Power | Power | Power | |||||||||
UAW Retiree Medical Benefits Trust (Sch. 13G, filed Feb. 11, 2014) | — | 140,150,000 | — | 140,150,000 | |||||||||
The Vanguard Group (Sch. 13G, filed Feb. 10, 2016) | 2,652,087 | 143,100 | 80,200,015 | 2,780,502 | |||||||||
Harris Associates L.P. (Sch. 13G, filed Feb. 10, 2016) | 70,226,598 | — | 70,226,598 | — |
Pursuant to the Stockholders Agreement dated October 15, 2009, between the Company and the UAW Retiree Medical Benefits Trust (the “VEBA Trust”), the VEBA Trust will vote its shares of our common stock on each matter presented to the shareholders at the Annual Meeting in the same proportionate manner as the holders of our common stock other than our directors and executive officers. The VEBA Trust will be subject to the terms of the Stockholders Agreement until it beneficially owns less than 2 percent of the shares of our common stock then issued and outstanding.
Section 16(a) Beneficial Ownership Reporting Compliance
Federal securities laws require that our directors and executive officers and shareholders that own more than 10 percent10% of our common stock report to the SEC and the Company certain changes in ownership and ownership information within specified periods. As a matter of practice, the Company’s administrative staff assists our directors and executive officers in preparing initial reports of ownership and reports of changes in ownership and files those reports on their behalf. Based solely on a review of the reports received byfurnished to us or filed with the SEC and upon information furnished by these people, we believe that during 2017 all such persons complied withof our directors and officers timely filed all applicable filing requirements during 2015 with one exception. In May 2015, Mr. Mulva made a filing on Form 4reports they were required to report an open market acquisitionfile under Section 16(a) of sharesthe Securities Exchange Act of common stock. Mr. Mulva timely reported the acquisition to the Company; however, due to an administrative error by the Company, the filing was late.1934.
Compensation Discussion and Analysis (CD&A)
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Compensation Discussion and Analysis (CD&A) | |||||
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Executive Compensation Tables | |||||
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Defined terms:
• | AFCF – Automotive Free Cash Flow |
• | DB – Defined Benefit |
• | DC – Defined Contribution |
• | DSV – Driving Stockholder Value |
• | EBIT – Earnings Before Interest and Taxes |
• | EPS – Earnings Per Share |
• | ESG – Environmental, Social, and Governance |
• | LTIP – Long-Term Incentive Plan |
• | GAAP – Generally Accepted Accounting Principles |
• | NEO – Named Executive Officer |
• |
• | OEM – Original Equipment Manufacturer |
• | PSU – Performance Share Unit |
• | RSA – Restricted Stock |
• | ROIC – Return on Invested Capital |
• | RSU – Restricted Stock Unit |
• | STIP – Short-Term Incentive Plan |
• | TSR – Total Shareholder Return |
Executive Compensation Table of Contents
35 |
EXECUTIVE COMPENSATION
Our Company Performance |
In 2015,2017, we continued progress toward our goal of making GM the most valued automotive company for our shareholders:shareholders. The results below demonstrate how we are positioning GM as an industry leader both now and in the future:
u | Completed the sale of Opel/Vauxhall and GM Financial European businesses to Peugot, S.A. (“PSA”); |
Exited franchises in South and East Africa and discontinued retail sales operations in India; |
u | For the fourth consecutive year, sold more pickup trucks in the United States than any other automaker – a record 948,909 units; |
u | Completed the refresh of GM’s crossover portfolio and became the fastest-growing crossover company in the United States, with retail market share up 1.6 percentage points to 13.1%, according to J.D. Power PIN estimates; |
u | Increased global Cadillac sales |
Improved EBIT-adjusted margin to 8.8% for continuing operations; |
u | Returned a total of | ||
u | IncreasedEPS-diluted-adjusted to $6.62; |
u | Launched Super Cruise, the world’s first hands-free highway driving technology, on the Cadillac CT6; |
u | Shared the vision for zero crashes, zero emissions, and zero congestion and outlined anall-electric future with plans to launch at least 20 electric vehicle models by 2023; |
u | Announced plans to deploy self-driving vehicles in a dense urban environment in 2019; |
u | Acquired Strobe, Inc. to help develop next-generation LiDAR solutions for self-driving vehicles and reduce LiDAR costs by 99% over time; and |
u | Became the first company to use mass-production methods to build autonomous electric test vehicles. |
Note: | EBIT-adjusted margin andEPS-diluted-adjusted arenon-GAAP financial measures. Refer to Appendix A for a reconciliation of thesenon-GAAP measures to their closest comparable GAAP measure. |
u | Our Vehicle Launches |
We launched 25 vehicles across the globe in 2017, including some of the key vehicles below:
u | Our Named Executive Officers |
Mary T. Barra | Chairman and Chief Executive Officer | |||
Charles K. Stevens, III | Executive Vice President and Chief Financial Officer | |||
Daniel Ammann | President | |||
Mark L. Reuss | Executive Vice President, Global Product Development, Purchasing and Supply Chain | |||
Alan S. Batey | Executive Vice President and President, North America | |||
Karl-Thomas Neumann | Former Executive Vice President and President, Europe |
36 |
$145.6B REVENUE $12.8B EBIT-ADJUSTED(1) All-Time Record $6.7B RETURNED TO SHAREHOLDERS $5.2B ADJUSTED AUTOMOTIVE FREE CASH FLOW(1) 28.2% ROIC-ADJUSTED(1) 22.5% TOTAL SHAREHOLDER RETURN(2) $6.62 EPS-DILUTED-ADJUSTED(1) All-Time Record 8.8% EBIT-ADJUSTED MARGINS All-Time Record We ended the year with 22.5% TSR. The Company continued to invest in the future and deliver on key financial measures while returning $6.7 billion to our shareholders.
EXECUTIVE COMPENSATION
We ended 2017 with the following key financial results:
Note: The financial information above relates to our continuing operations.
(1) | These arenon-GAAP financial measures. Refer to Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form10-K for the fiscal year ended December 31, 2017 for a reconciliation of |
We launched 25 vehicles across the globe in 2015, including some of the key vehicles below:
(2) | |
We ended the year with the following key financial results:
Assumes dividends are reinvested in common stock. |
u | Compensation Governance and Best Practices |
WHAT WE DO | ||
ü | Provide | |
ü | Conduct annual advisory vote for shareholders to approve executive compensation | |
ü | Maintain a Compensation Committee composed entirely of independent directors | |
ü | Require stock ownership | |
ü | Conduct rigorous shareholder engagement by management and directors, including our Executive Compensation Committee and our Lead Independent Director | |
ü | Includenon-compete andnon-solicitation terms in all grant agreements with | |
ü | Retain an independent executive compensation | |
ü | Maintain a Securities Trading Policy requiring directors, | |
ü | Require equity awards to have a | |
ü | Complete | |
ü | Maintain a clawback policy to apply to actions that damage GM’s reputation | |
WHAT WE DON’T DO | ||
û | Providegross-up payments to cover personal income taxes or excise taxes pertaining to executive or severance benefits | |
û | Allow directors or executives to engage in hedging or pledging of GM securities | |
û | Reward executives for excessive, inappropriate, or unnecessary risk-taking | |
û | Allow the repricing or backdating of equity awards |
37 |
Say-on-Pay Voting and Annual Meeting Review Say-on-Pay Voting Meet With Investors Review Feedback and Adjust Plans File Annual Proxy Statement
EXECUTIVE COMPENSATION
We view investor outreachshareholder engagement as an ongoing cycleimportant and in 2015 bothcontinuous cycle. During 2017, members of the Board and selectmet in-person with shareholders representing approximately 25% of our outstanding common stock. In addition, during 2017, one or more members of management continued to holdwere involved in more than 75in-person and telephonic meetings with investors representing more than 45% of shares outstanding. These discussions, with some ofsay-on-pay voting results, and other factors are key drivers in assessing our largest investors. Through these discussions, we regularly receive feedback on Company performance and compensation programs.
|
SHAREHOLDER SAY-ON-PAY The Compensation Committee seeks to align the Company’s executive compensation program with the interests of the Company’s shareholders. The Compensation Committee considers the results of the annualSay-On-Pay vote, input from management, input from its independent compensation consultant, and investor
|
Some of the feedback we heard from investors and how it impacted compensation design included the following:
The Company values investor feedback and will continue our investor outreachto seek feedback through engagement initiatives to ensurealign our executive compensation programs remain alignedwith shareholder expectations. We made changes to shareholder expectations.our compensation plans that commenced at the start of 2017 to further align the interests of our senior leaders with those of our shareholders.
What We Heard | How We Responded | |
Maintain pay for performance | We continue to evolve our pay practices to support our pay-for-performance philosophy. For 2017, we added an individual performance measure into our STIP while continuing Company focus on EBIT-adjusted and Adjusted AFCF. In our LTIP we now measure both ROIC-adjusted and TSR performance relative to our OEM peers while replacing RSUs with Stock Options to further align the interests of our most senior leaders with those of our shareholders. | |
Continue to invest in the future | Our LTIP places a focus on investing in our future. By continuing to place a focus on ROIC and measuring performance relative to OEM peers, we are incentivizing our most senior leaders to make investments in the future of GM while delivering a return on investment that outperforms other OEMs. | |
Consider ESG performance when making pay decisions | The Company introduced our vision of a future with zero crashes, zero emissions, and zero congestion in 2017. Several key ESG results are discussed in the proxy statement summary on page 6 and in “Executive Compensation—Compensation Overview—Our Company Performance” on page 36. In addition, we introduced an individual performance component weighted at 25% for our STIP. Please see pages 48–53 where we discuss individual performance results, including results that had a positive impact on ESG measures. | |
Look at performance relative to automotive industry peers | Our PSUs measure both Relative ROIC-adjusted and Relative TSR against the Company’s OEM peers to motivate our leaders to perform at the top of the industry regardless of business cycles. | |
Keep compensation plans simple | We simplified our compensation plans in 2017 to focus our most senior leaders on both key operational performance measures and individual results in the STIP. This change added a complete line of sight into compensation for each senior leader. We adjusted the LTIP to focus senior leaders on outperforming our peers and increasing stock price to create value for our shareholders. |
38 |
2013 2014 2015 2016 2017 Actions We Took Company exited TARP Final year of granting Salary Stock Units, which were vested on date of grant to NEOs Actions We Took Introduced non-compete and non-solicitation terms into all LTIP awards for all Senior Leaders beginning with the Driving Stockholder Value grant Actions We Took STIP – Increased focus on EBIT-Adjusted to drive profitable growth 40% EBIT-Adjusted 25% Adjusted AFCF 10% Global Market Share 25% Global Quality Actions We Took Introduced stock ownership requirements Introduced a performance-based compensation structure with both STIP and LTIP STIP – Performance based on the following measures: 25% EBIT-Adjusted 25% Adjusted AFCF 25% Global Market Share 25% Global Quality LTIP – Structure for NEOs includes 75% PSUs and 25% RSUs PSUs – Performance-based vesting on 100% ROIC Adjusted with a Global Market Share modifier, PSUs vest at the end of the three year performance period RSUs – Time-based vesting in equal tranches over three years Actions We Took STIP – Increased focus on key financial measures and added an individual performance element to incorporate individual performance goals for each NEO 50% EBIT-Adjusted 25% Adjusted AFCF 25% Individual Performance LTIP – Eliminated time-vested RSUs and replaced with Stock Options. NEOs will have a mix of 75% PSUs and 25% Stock Options Incorporated relative performance measures into PSUs Relative ROIC-Adjusted – 50% of LTIP Relative TSR – 25% of LTIP 2017 STIP 2017 LTI
EXECUTIVE COMPENSATION
u | Compensation Program Evolution |
Our compensation programs have continued to focus our leaders on the key areas that both drive the business forward and align to the short-term and long-term interests of our shareholders. The Compensation Committee regularly reviews and discusses plan performance at each Compensation Committee meeting. The Compensation Committee considers many factors when electing to make plan changes for future incentive plans, including results, market trends, and investor feedback. The table below shows how the compensation program has continued to evolve to align with shareholders’ interests.
39 |
Relative ROIC-Adjusted (50% of LTIP) Relative TSR (25% of LTIP)
EXECUTIVE COMPENSATION
The Company held engagements with investors and received feedback on changes to both the STIP and LTIP. The 2017 STIP continued a focus on key financial measures (75% of STIP) and individual performance (25% of STIP). The total payout for the STIP will be 0% to 200% of target based on actual performance againstpre-established goals. The Compensation Committee determined individual performance using a rigorous assessment process measuring performance againstpre-established operational and other measures.
The 2017 LTIP replaced time-based RSUs with Stock Options to further align our most senior leaders with our shareholders’ interest in stock price appreciation. In addition, the Company changed PSU performance measures from ROIC-adjusted with a Global Market Share modifier to Relative ROIC-adjusted (50% of total LTIP) and Relative TSR (25% of total LTIP) against OEMs in the Dow Jones Automobiles and Parts Titans 30 Index, listed below.
Dow Jones Automobiles & Parts Titans 30 Index – OEM Peer Group | ||||
Toyota Motor Company | Volkswagen AG | Suzuki Motor Corp. | ||
Daimler AG | Bayerische Motoren Werke AG | Fiat Chrysler Automobiles NV | ||
Ford Motor Company | Nissan Motor Co. Ltd | Tesla, Inc. | ||
Honda Motor Co. Ltd. | Renault SA | Mazda Motor Corp. | ||
General Motors Co.(1) | Hyundai Motor Co. | Kia Motors Corp. |
(1) | GM’s performance will be determined on a continuous ranking for performance relative to OEM peers following the completion of the performance period. |
The percentile rank required for each performance level relative to OEM peers and associated payouts for PSUs are displayed below.
Focusing performance on key financial measures and individual operational performance measures in the short term, combined with performance in both Relative ROIC-adjusted and Relative TSR compared with our other OEM peers in the long term, provides direct alignment of our executive compensation programs with the interests of our shareholders and continues to focus our senior leaders on making the investments that will provide for profitable long-term growth.
40 |
EXECUTIVE COMPENSATION
u | Peer Group for Compensation Comparisons |
In 2015, we made changes to ourThe Compensation Committee annually reviews the peer group by removing ConocoPhillips, Chevron Corporation,for compensation comparisons and Lockheed Martin Corporationmakes updates as needed to align with both the established criteria and adding Intel Corporation, based on the guidelines established by the Compensation Committee for our peer group selection. Companies must satisfy each of the following criteria to be considered for the peer group:
Additionally, the Compensation Committee considers the following factors when selecting our peer group:
Company strategy. We do not limit our peer group to our industry alone, because we believe compensation practices for NEOs at other large U.S.-based multinationals affect our ability to attract and retain diverse talent around the globe.
In determining 2017 compensation, we maintained the same compensation peer group from 2016. Based on the guidelines established by the Compensation Committee for our peer group selection, companies must satisfy each of the following criteria to be considered for the peer group:
Revenue greater than $25 billion
Significant international revenue
Capital-intensive operations
In addition, the Compensation Committee considers the following factors when selecting our peer group:
| ||||||
3M Company | Industrial Conglomerates | Honeywell International Inc. | Aerospace and Defense | ||||||
The Boeing Company | Aerospace and Defense | IBM Corporation | IT Consulting and Other Services | ||||||
Caterpillar Inc. | Construction Machinery and Heavy Trucks | Intel Corporation | Semiconductors | ||||||
Deere & Company | Agricultural and FarmMachinery | Johnson & Johnson | Pharmaceuticals | ||||||
The Dow Chemical Company(1) | Diversified Chemicals | Johnson Controls Inc.(1)(2) | Auto Parts and Equipment | ||||||
Du Pont(1) | Diversified Chemicals | ||||||||
Soft Drinks and Food | |||||||||
Ford Motor Company | Automobile Manufacturers | Pfizer Inc. | Pharmaceuticals | ||||||
General Electric Company | Industrial Conglomerates | The Procter & GambleCompany | Household Products | ||||||
HP, Inc. | Technology Hardware, Storage, and Peripherals | United Technologies Corp. | Aerospace and Defense |
(1) | Companies were involved in significant mergers, acquisitions, or divestitures. The Committee will evaluate each peer company for inclusion in the peer group for 2018 and beyond. |
(2) | The Committee removed Johnson Controls Inc. from the peer group during their 2017 annual review. |
u | How We Use Comparator Data to Assess Compensation |
We use executive compensation surveys composed of a broad array of industrial companies to benchmark relevant market data for executive positions. In addition, we benchmark pay practices and compensation levels against the proxy statement disclosures of our peer group and adjust this data to reflect GM’s size and market expected compensation growth.trends. Further, we review the competitive market position of each of our executives compared with the peer group and benchmarked positions from executive compensation surveys.
market data.
We review each element of compensation compared with the market and generally target each element of our total direct compensation levels(base salary, STIP, and LTIP) for the executive group on average to be at or near the market median. However, an individual element or an individual’s total direct compensation may be positioned above or below the market median because of considerations such as his or her specific responsibilities, experience, and performance.
41 |
GM MANAGEMENT Makes recommendations regarding compensation structure Provides input on individual performance and results against key business goals Provides additional information as requested by the Committee COMMITTEE CONSULTANT Advises the Committee on competitive benchmarking on pay levels, practices, and governance trends Assists with peer group selection and analysis Reviews and advises on recommendations, plan design, and measures EXECUTIVE COMPENSATION COMMITTEE Approves plan design, metrics, and goals Approves overall incentive compensation funding levels Reviews and approves individual target and actual compensation for the most senior executives CEO 2017 COMPENSATION STRUCTURE AVERAGE NEO 2017 COMPENSATION STRUCTURE
EXECUTIVE COMPENSATION
u | How We Plan Compensation |
We believe aligning pay to the achievement of both short-term and long-term goals is a cornerstone of executive engagement and have set up a pay program seeking to:
During 2015, the compensation structure for our NEOs included the following core elements:
Additionally, in 2015, we granted our senior leaders a one-time DSV Option Grant that included non-compete and non-solicitation terms for each senior leader. DSV awards vest over a period of 4.6 years with 60 percent of the options vesting only if performance goals are met as described on page 45, and 40 percent time-based vesting.
Performance-Based Compensation Structure |
Our NEOs are focusedincentivized to focus on optimizing long-term financial returns for our shareholders through increasing profitability, increasing margins, putting the customer at the center of everything we do, growing the business, and driving innovation.
The performance-based structure for 2017 incorporates both short-term and long-term incentives established from financial and operational metrics for fiscal year 20152017 and beyond. In addition to base salary and an annual STIP award, this structure, shown graphically below, includes an annual STIP award and an LTIP award made up of both PSUs and RSUsStock Options to focus our executives on long-term Company performance. The Compensation Committee believes a majority of compensation should be in the form of equity to align the interests of executives with those of shareholders.
For our CEO, 90 percent of target compensation is pay-at-risk, 72 percent is linked to performance against goals, and 72 percent is linked to the performance of common stock. For other NEOs, on average 82 percent of target compensation is pay-at-risk, 67 percent is linked to performance against goals, and 59 percent is linked to the performance of common stock.
42 | |||
2015 Compensation ElementsEXECUTIVE COMPENSATION
In 2015, the
The compensation provided to our senior leaders wascontinues to be guided by six generalthe following principles:
Aligned with Shareholders – Compensation paid should align directly with the long-term interests of our shareholders, and our executives should share with them in the performance and value of our common stock;
Performance-Based – Compensation paid should be based on a balance of financial and operational goals reflecting strong financial performance relative to our OEM competitors. The goals should be aggressive but achievable, within our executives’ control and should reward commitments met;
Recognize Individual Performance – Compensation paid should motivate executives to perform at their best, reflecting their clear line of sight and contributions as well as their behaviors and demonstration of GM’s core values. Individual performance must be aligned with Company performance and desired behaviors;
Simple Design – Our compensation plan should be easy to understand and communicate and minimize unintended consequences;
Avoidance of Incentive to Take Excessive Risk– Compensation structure should avoid incentives to take unnecessary and excessive risk. Compensation should be paid over a period of time that takes into account the potential risk over the same time period;
Appropriate Allocation of Compensation Components – The structure should appropriately allocate total compensation to fixed and variable pay elements resulting in an appropriate mix of short-term and long-term pay elements; and
Comparable Target Compensation– Overall target compensation should be competitive (market median) with that paid to individuals at peer group companies so that it attracts, motivates, and retains talent.
2017 Compensation | |
Each NEO’s 2017 compensation structure is market competitive with each pay element targeted at or near the market median. The compensation structure included the following pay elements:
Base Salary – NEOs are paid a market-competitive base salary that reflects each NEO’s contribution, background, and performance as well as the knowledge and skills he or she brings to the role;
STIP – The STIP is an annual cash incentive plan. The STIP rewards each NEO based on the achievement of annual Company financial goals and individual performance results. The potential payout ranges from 0% to 200% of target, based on actual Company performance and individual performance;
PSUs – PSUs are equity awards designed to align each NEO’s interests with the long-term interests of the Company and its shareholders. PSUs can be earned at a level from 0% to 200% of target, based on the actual Company performance against Relative ROIC-adjusted and Relative TSR over the three-year performance period beginning January 1, 2017; and
Stock Options – Stock options are time-based equity awards vesting ratably over a three-year period. Stock options align the interests of our most senior executives with our shareholders’ interest in stock price appreciation and allow our leaders to share in the gains with shareholders.
Perquisites |
We provide perquisites benefits, and other compensation to our NEOs consistent with market practices. The following perquisites benefits, and other compensation were provided to NEOs in 2015:2017:
Personal Air Travel– Ms. Barra is prohibited by Company policy from commercial air travel due to security-relatedsecurity reasons identified by an independent third-party security consultant. As a result, the Company pays the costs associated with the use of chartered or Company-ownedprivate aircraft for both business and personal use. Ms. Barra is permitted to be accompanied by guests for personal travel and incurs imputed income for all passengers, including herself, at the U.S. Internal Revenue Service (the “IRS”) Standard Industry Fair Level rates. Other NEOs may travel on chartered or Company-ownedprivate aircraft in limitedcertain circumstances with prior approval from the CEO or the Senior Vice President, Global Human Resources, and also incur imputed income for any personal travel.
Company Vehicle Programs – NEOs are eligible to participate in the Executive Company Vehicle Program and are allowed to use evaluation vehicles for the purpose of providing feedback on Company products. In addition, NEOs are eligible to use driver services provided by the Company and in accordance with Company policies.
43 | ||||
EXECUTIVE COMPENSATION
Security – NEOs may receive security services, including home security systems and monitoring, for specific security-related reasons identified by independent third-party security consultants.
Financial Counseling– NEOs are eligible to receive financial counseling, estate planning, and tax preparation services through an approved provider.
Executive Physicals – NEOs are eligible to receive executive physicals with approved providers.
On July 28, 2015, the Compensation Committee authorized the DSV Option Grant providing a one-time stock option award to senior leaders in exchange for agreeing to non-compete and non-solicitation terms with the Company. The award is described in full on page 45 and vests over a period of 4.6 years, with 40 percent featuring time-based vesting and 60 percent featuring performance-based vesting.
2017 Target Compensation |
Our target total direct compensation for each NEO in 20152017 was as follows:
Annual Base | Target Total Cash | LTIP | Target Total Direct | |||||||||||||||||||||||||||||||||||||||||
Salary | STIP | Compensation | PSUs | RSUs | Compensation | Annual Base Salary ($)
| STIP (%)
| STIP ($)
| Target Total Cash Compensation ($)
|
LTIP
| Target Total Compensation ($)
| |||||||||||||||||||||||||||||||||
Name | ($) | ($) | ($) | ($) | ($) | ($) | PSUs(2) ($)
| Stock ($)
| ||||||||||||||||||||||||||||||||||||
Mary T. Barra | 1,750,000 | 3,062,500 | 4,812,500 | 9,000,000 | 3,000,000 | 16,812,500 |
|
2,100,000
|
|
|
200
|
%
|
|
4,200,000
|
|
|
6,300,000
|
|
|
9,750,000
|
|
|
3,250,000
|
|
|
19,300,000
|
| |||||||||||||||||
Charles K. Stevens, III | 1,000,000 | 1,250,000 | 2,250,000 | 2,156,250 | 718,750 | 5,125,000 |
|
1,100,000
|
|
|
125
|
%
|
|
1,375,000
|
|
|
2,475,000
|
|
|
2,793,750
|
|
|
931,250
|
|
|
6,200,000
|
| |||||||||||||||||
Daniel Ammann | 1,200,000 | 1,500,000 | 2,700,000 | 3, 375,000 | 1,125,000 | 7,200,000 |
|
1,450,000
|
|
|
125
|
%
|
|
1,812,500
|
|
|
3,262,500
|
|
|
3,703,125
|
|
|
1,234,375
|
|
|
8,200,000
|
| |||||||||||||||||
Mark L. Reuss | 1,100,000 | 1,375,000 | 2,475,000 | 2,868,750 | 956,250 | 6,300,000 |
|
1,200,000
|
|
|
125
|
%
|
|
1,500,000
|
|
|
2,700,000
|
|
|
3,037,500
|
|
|
1,012,500
|
|
|
6,750,000
|
| |||||||||||||||||
Craig B. Glidden | 700,000 | 875,000 | 1,575,000 | 1,443,750 | 481,250 | 3,500,000 | ||||||||||||||||||||||||||||||||||||||
Alan S. Batey
|
|
1,025,000
|
|
|
125
|
%
|
|
1,281,300
|
|
|
2,306,300
|
|
|
2,020,275
|
|
|
673,425
|
|
|
5,000,000
|
| |||||||||||||||||||||||
Karl-Thomas Neumann(1)
|
|
1,050,000
|
|
|
125
|
%
|
|
1,312,500
|
|
|
2,362,500
|
|
|
1,781,250
|
|
|
593,750
|
|
|
4,737,500
|
|
The targeted Total Direct Compensation for Dr. Neumann reflects the base salary and STIP in U.S. dollars. Dr. Neumann received a salary of €811,864 and an annual STIP target of €1,014,830. |
(2) | The number of PSUs awarded is determined by using the target PSU value divided by the closing price on the date of grant. PSUs with performance tied to relative TSR are valued using a Monte Carlo analysis, and Summary Compensation Table amounts may be higher or lower than target. |
Realized compensation provides a more accurate view of the compensation Ms. Barra actually received. The table to the right shows realized compensation for fiscal years 2013, 2014, and 2015. Realized compensation includes actual salary earned, actual STIP payments, and equity awards that vested during each year.
In 2015, Ms. Barra’s realized compensation was $7.3 million. For year-end 2013, Ms. Barra was Executive Vice President, Global Product Development, Purchasing and Supply Chain. On January 15, 2014, the Board of Directors elected Ms. Barra to the position of CEO. On January 4, 2016, Ms. Barra was elected to the additional role of Chairman of the Board of Directors.
REALIZED COMPENSATION (in millions)
How We Set Performance Targets |
Annually, the Compensation Committee approves the performance measures for the STIP and LTIP. The Compensation Committee reviews recommendations from management, receives input from the Compensation Committee consultant, evaluates the annual budget and mid-termmid term business plan, and reviews prior-year performance to setapprove value-creating goals tied to long-term shareholder value.
2017 STIP Performance Measures for NEOs |
The STIP aligns with our plans to create the world’s most valued automotive company and increasingto increase shareholder value. The STIP rewards NEOs for performance linked to the Company’s achievement of annual financial goals, operational performance goals, and individual performance.performance results. The STIP is an annual cash incentive award intended to be deductible as performance-based compensation under U.S. Internal Revenue Code (“IRC”) Section 162(m) and is funded for each covered NEO once the Company achieves the threshold of positive EBIT-Adjusted.
EBIT-adjusted.
The Compensation Committee annually reviews and approves theSTIP goals to assess the difficulty in level of achievement and overall linkage to shareholders through the achievement of the business plan and strategic objectives. For the 2017 STIP, all targets were set at or above final 2016 performance. The Committee elected to adjust the weights to increase EBIT-adjusted to 50% and removed both global Market Share and Global Quality as overall measures. The Committee added individual performance with a weight of 25% as a measure to evaluate individual performance for each leader. Individual performance results and final individual compensation decisions are discussed beginning on page 48. Individual performance is assessed with an individual performance scorecard measuring results againstpre-established goals that the Committee approves at the beginning of the year. Global market share and global quality are still focus items that the Committee considers when evaluating individual performance results.
44 |
EXECUTIVE COMPENSATION
Actual STIP awards, if any, are determined following the completion of the plan year by adjusting each NEO’s target incentive award opportunity to reflect the achievement against the performance measures displayed below. Awards can be further adjusted following a final assessment of individual performance. The table below describes each STIP performance measure, its weighting, its target, and the behaviors each measure drives to make GM the world’s most valued automotive company:drives:
STIP Measure | Weight | Target | Leadership Behaviors | ||||
EBIT-Adjusted | 25% | $ | 10.3B | Focus on operating profit and driving strong profitability | |||
Adjusted AFCF(1) | 25% | $ | 3.8B | Focus on driving strong cash flow in the business | |||
Global Market Share | 25% | 11.7% | Focus on continuing to grow in the global marketplace | ||||
Global Quality | 25% | (2) | Focus on developing and marketing the highest-quality products |
STIP Measure
| Weight
| Target
| Leadership Behaviors
| |||||||
EBIT-adjusted
|
|
50%
|
|
|
$12.7
|
|
Focus on operating profit and driving strong profitability
| |||
Adjusted AFCF (1)
|
|
25%
|
|
|
$ 6.3
|
|
Focus on driving strong cash flow to invest in the business
| |||
Individual Performance
|
|
25%
|
|
|
25 pts.
|
|
Focus on individual performance goals that impact business results
|
(1) | Adjusted AFCF for incentive purposes excludes payments related to certain recall-related expenses attributable to events occurring in 2014. |
The potential payouts for each company performance measure range from 00% to 200 percent200% of target, based on actual Company performance with the threshold performance level being 50 percent50% of each STIP measure. The STIP calculation and the STIP targets for the 20152017 performance period determined the result for each NEO are as follows:NEO:
Target as % of | ||||||||
Name | Base Salary | Salary | Target STIP | |||||
Mary T. Barra | $ | 1,750,000 | 175% | $ | 3,062,500 | |||
Charles K. Stevens, III | $ | 1,000,000 | 125% | $ | 1,250,000 | |||
Daniel Ammann | $ | 1,200,000 | 125% | $ | 1,500,000 | |||
Mark L. Reuss | $ | 1,100,000 | 125% | $ | 1,375,000 | |||
Craig B. Glidden | $ | 700,000 | 125% | $ | 875,000 |
2017–2019 LTIP Performance Measures for NEOs |
Grants under the LTIP are intended to link the financial interests of NEOs with the long-term interests of shareholders. The structure for NEOs included 75 percent75% PSUs and 25 percent RSUs.25% Stock Options. PSUs cliff-vest following the three-year performance period, and RSUsStock Options vest ratably over three years.
The 2015–20172017–2019 PSUs are awarded based on performance against the following Company measures: ROICmeasures relative to our OEM peers: Relative ROIC-adjusted and Global Market ShareRelative TSR over the three-year performance period. The PSU performance measures were chosen to promote both efficient use of capital and long-term growth to create value for the shareholders.shareholders and an increased focus on stock price appreciation. The following table shows the PSU performance measures and the leadership behaviors that each drives to make GM the world’s most valued automotive company:
|
| |||||||
Target | Leadership Behaviors |
Relative ROIC-adjusted (1) | 67% | 60th Percentile | Focus on making sound investments that follow the disciplined capital approach of driving 20% or higher returns in world-class vehicles and leading technology | |||||
Relative TSR (1) | 33% | 50th Percentile | Focus on delivering shareholder returns that outperform our OEM peers |
LTIP Measure | Weight | Target | Leadership Behaviors | |||||
ROIC(1) | 100 | % | 20 | % | Focus on making sound investments that follow the disciplined capital approach of driving 20% or higher returns in world-class vehicles and leading technology | |||
Global Market Share(2) | Modifier | (3 | ) | Focus on continuing to grow in the global marketplace |
(1) |
|
45 |
EXECUTIVE COMPENSATION
PSUs, if any, vest and are awarded and delivered following the completion of the three-year performance period, January 1, 2015 –December2017 through December 31, 2017,2019, and may be awardedearned at a level between 00% and 200 percent200% of target based on actual Company results. FinalWhen determining grant amounts, the Compensation Committee considers factors such as individual responsibilities, experience, and performance. In addition, the Compensation Committee will factor in relevant market compensation comparison data and seek the input from their independent compensation consultant.Final PSU awards are calculated as follows:
When determining grant amounts, the Compensation Committee considers the individual responsibilities, experience, performance, and market data. The following NEOs received equity grants as part of their 2015 structure:
PSUs(1) | RSUs(2) | |||||||||||
Units | % of | Units | % of | Total Units | ||||||||
Name | Granted | Total Units | Granted | Total Units | Granted | |||||||
Mary T. Barra | 238, 917 | 75 | % | 79,639 | 25 | % | 318,556 | |||||
Charles K. Stevens, III | 57,241 | 75 | % | 19,081 | 25 | % | 76,322 | |||||
Daniel Ammann | 89,594 | 75 | % | 29,865 | 25 | % | 119,459 | |||||
Mark L. Reuss | 76,155 | 75 | % | 25,385 | 25 | % | 101,540 | |||||
Craig B. Glidden | 39,297 | 75 | % | 13,099 | 25 | % | 52,396 |
On July 28, 2015, the Compensation Committee authorized a one-time DSV Option Grant for senior leaders under the 2014 LTIP. The purpose of the grant was to maintain the consistency in leadership needed for achieving the Company’s near-term and long-term goals as new competitors enter the automotive manufacturer market and actively seek to recruit our talent. The grant included both non-compete and non-solicitation terms and was intended to drive momentum as we make GM the world’s most valued automotive company.
The Compensation Committee established 40 percent of the award with time-based vesting to provide incentive for senior leaders to enter into non-compete and non-solicitation terms. The Compensation Committee chose to use TSR compared to the OEM Peer Group (displayed below) for the remaining 60 percent of the award to focus the senior leaders on our stock price performance against other OEMs. We understand investors can choose the automotive company in which to invest, and we must perform better than our competition.
Each of the NEOs received the following stock option award as part of the Driving Stockholder Value Option Grant:
2018: 20% | 2019: 20% | 2020: 20% | |||||||||||
Exercise | Total | 2017: 40% | TSR vs. OEM | TSR vs. OEM | TSR vs. OEM | ||||||||
Name | Price | Grant | Time-Based | Peer Group(1) | Peer Group(1) | Peer Group(1) | |||||||
Mary T. Barra | $ | 31.32 | 2,603,037 | 1,041, 215 | 520,608 | 520,607 | 520,607 | ||||||
Charles K. Stevens, III | $ | 31.32 | 623,645 | 249,458 | 124,729 | 124,729 | 124,729 | ||||||
Daniel Ammann | $ | 31.32 | 976,139 | 390,456 | 195,228 | 195,228 | 195,227 | ||||||
Mark L. Reuss | $ | 31.32 | 829,719 | 331,888 | 165,944 | 165,944 | 165,943 | ||||||
Craig B. Glidden | $ | 31.32 | 417, 571 | 167,029 | 83,514 | 83,514 | 83,514 |
Summary of Outstanding Performance Awards Granted in Prior Years |
46 |
EXECUTIVE COMPENSATION
2015 Performance Results and Compensation Decisions
2017 Short-Term Incentive Plan |
The Company portion of the 20152017 STIP award was calculated based on Companythe Company’s achievement of the following equally-weighted performance measures: EBIT–EBIT-adjusted and Adjusted Adjusted AFCF, Global Market Share, and Quality. Actual 2015AFCF. In addition, each NEO has an individual performance portion of their STIP that measures performance againstpre-established goals. Company performance inincluding the combined measures produced an overall payout of 100 percent based on the achievement ofindividual results achieved the following levels for each measureresults, as approved by the Compensation Committee:Committee. The results for EBIT-adjusted repeated GM’s 2016 record performance:
Performance | Performance | ||||||||||||||||
STIP Measure | Weight | Threshold | Target | Maximum | Results | Payout | |||||||||||
EBIT – Adjusted ($B) | 25 | % | $ | 6.6 | $ | 10.3 | $ | 13.2 | $ | 10.8 | 29 | % | |||||
Adjusted AFCF ($B)(1) | 25 | % | $ | 0.0 | $ | 3.8 | $ | 6.7 | $ | 4.5 | 31 | % | |||||
Global Market Share | 25 | % | 11.2 | % | 11.7 | % | 12.0 | % | 11.3 | %(2) | 15 | % | |||||
Global Quality(3) | 25 | % | Various Metrics | (4) | 25 | % | |||||||||||
Result | 100 | % |
STIP Measure
|
Weight
|
Threshold
|
Target
|
Maximum
|
Performance Results
|
Performance Payout
| ||||||||||||||||||
EBIT-adjusted ($B)
|
|
50%
|
|
|
$ 6.8
|
|
|
$ 12.7
|
|
|
$ 14.0
|
|
|
$ 12.8
|
|
|
54
|
%
| ||||||
Adjusted AFCF ($B) (1)
|
|
25%
|
|
|
$ 0.0
|
|
|
$ 6.3
|
|
|
$ 7.3
|
|
|
$ 5.6
|
|
|
24
|
%
| ||||||
Individual Performance
|
|
25%
|
|
|
0 pts.
|
|
|
25 pts.
|
|
|
50 pts.
|
|
|
25 – 40 pts.
|
|
|
25%–40
|
%
| ||||||
Result |
|
103%–118 |
% |
(1) | Adjusted AFCF for incentive purposes excludes payments related to certain recall-related expenses attributable to events occurring in 2014. |
u | 2015–2017 Long-Term Incentive Plan |
The 2015–2017 PSU awards vested on February 11, 2018, based on Company performance for the period January 1, 2015 through December 31, 2017 againstpre-established performance targets for both ROIC-adjusted and the Global Market Share modifier. The following performance was approved by the Compensation Committee:
LTIP Measure
|
Weight
|
Threshold
|
Target
|
Maximum
|
Performance Results
|
Performance Payout
| ||||||||||||||||||
ROIC-adjusted
|
|
100%
|
|
|
16.0%
|
|
|
20.0%
|
|
|
24.0%
|
|
|
28.1
|
%(1)
|
|
200
|
%
| ||||||
Result |
|
200 |
%(2) |
(1) | Represents the average of ROIC-adjusted for 2015 to 2017. ROIC-adjusted for 2015 and 2016 was 27.2% and 28.9%, respectively. ROIC-adjusted for 2017 was 28.2%, as reported on a continuing operations basis. |
(2) | The modifier for Global Market Share reduces the payout 25 points if Global Market Share is below 11.3%. The payout is increased 25 points if Global Market Share is at or above 11.8% not to exceed plan maximum of |
Focusing our leaders on ROIC-adjusted has resulted in significant performance improvements since calendar year 2012, when ROIC-adjusted was 16.0% at which time we set an enduring target of 20% based on commitment to shareholders. We ended calendar year 2017 with a ROIC-adjusted of 28.2%. The 2017–2019 PSUs focus leaders not only on delivering improved ROIC-adjusted results, but also on being the top automotive OEM for ROIC-adjusted results.
u | One-time 2015–2020 DSV Option Grant |
The DSV option grant was aone-time grant made on July 28, 2015 to senior leaders to securenon-compete andnon-solicitation terms and to drive an increased focus on stock price appreciation. The DSV grant featured 40% time-based vesting and 60% performance-based vesting. The performance-based portion vests upon meeting or exceeding the median TSR relative to the OEM peer group in place on the date of grant. 20% of the DSV option grant vested based on relative TSR performance for the period July 28, 2015–December 31, 2017 and 40% of the overall award remains outstanding with performance periods ending on December 31, 2018, and December 31, 2019.
DSV Measure
|
Performance Period
|
Vesting Date
|
Weight
|
Target TSR
|
Result
|
Vesting
| ||||||||||||||||||
Relative TSR |
|
July 28, 2015–December 31, 2017 |
|
|
February 15, 2018 |
|
|
20 |
% |
|
50th Percentile |
|
|
87th Percentile |
|
|
100 |
% |
Individual performance may also influence final STIP awards. The compensation decision made for each individual executive is discussed beginning on the next page.
47 |
EXECUTIVE COMPENSATION
Compensation Decisions for Mary T. Barra |
Mary T. Barra, Chairman and Chief Executive Officer
Ms. Barra’s performance for
u Increased EPS-diluted-adjusted to record $6.62 u Achieved 13 top 3 models in the u Received the u Chevrolet sold a record number of u Completed the sales of Opel/Vauxhall and GM Financial European businesses to PSA u More than 150 facilities are operating landfill free u Global Cadillac experienced record sales in 2017 with significant increases from GM China
u Expanded both Maven and Book by Cadillac to increase carsharing capabilities u Announced plans to deploy self-driving vehicles in a dense urban environment in 2019 uLaunched u 180 Cruise autonomous vehicles built with approximately 100 testing in Arizona, California, and Michigan u Acquired Strobe, Inc. to help develop next-generation LiDAR solutions for self-driving vehicles and
u Became the
|
Effective January 1, 2015,2017, the Compensation Committee increased Ms. Barra’s base salary from $1,600,000$2,000,000 to $1,750,000$2,100,000 based on her individual performance, leadership, and the competitive market analysis provided by the Compensation Committee’s independent compensation consultant. TheFor 2017, the Compensation Committee awarded Ms. Barra an annual equity grant of $12$13 million consisting of 75 percent75% PSUs and 25 percent RSUs as discussed above.25% Stock Options. These changes placed Ms. Barra participated in line with the one-time DSV Option Grant during 2015.compensation peer group, as her targeted total direct compensation remained competitive at the market median.
The Compensation Committee awarded Ms. Barra 40 points based on her results, highlighted above, for the 2017 performance year. The total compensation for Ms. Barra in 2015,2017, including salary, bonus, STIP and LTIP awards, and options is displayed below.
Pay Element | Majority of Pay Is At-Risk | Awarded Value | ||||
Base Salary | Fixed – Only Guaranteed Pay Element | $ | 1,750,000 | |||
STIP | Performance to Company Metrics | $ | 3,062,500 | |||
PSUs(1) | Performance to Company Metrics and Stock Price | $ | 9,000,003 | |||
RSUs(2) | Performance to Stock Price | $ | 3,000,001 | |||
TOTAL | $ | 16,812,504 | ||||
DSV Options(1) | Performance to Stock Price and TSR Against OEM Peer Group | $ | 11,167,029 | |||
TOTAL WITH ONE-TIME AWARDS | $ | 27,979,533 |
Pay Element | Majority of Pay Is At-Risk | Awarded Value | ||||
Base Salary | Only Fixed Pay Element | $ 2,100,000 | ||||
STIP | Performance to Metrics | $ 4,956,000 | ||||
PSUs(1) | Performance to Metrics and Stock Price | $10,737,570 | ||||
Stock Options(2) | Performance to Stock Price | $ 3,250,003 | ||||
TOTAL | $21,043,573 |
(1) | PSUs |
(2) |
|
Awarded value reflects the amount included in the Summary Compensation Table, excluding change in pension value and all other compensation. Realized compensation includes base salary, earned STIP, and all options exercised and stock vested during the year. 2017 realized compensation increased relative to the prior year reflecting 1) the vesting of the PSU award granted to Ms. Barra in 2014, the year she was promoted to her current role; and 2) an increase in stock price at the time of vesting versus the prior year.
48 |
EXECUTIVE COMPENSATION
u |
Compensation Decisions for Charles K. Stevens, III |
Charles K. Stevens, III,Executive Vice President &and Chief Financial Officer
Effective January 1, 2015, 2017 performance highlights for Mr. Stevens include:
u | Continued to drive improvement in EBIT-adjusted and delivered record EBIT-adjusted margins, including the third straight year of 10% or higher margins in North America |
u | IncreasedEPS-diluted-adjusted to record $6.62 |
u | Repurchased more than $6.7 billion and returned $25 billion to shareholders through dividends and share repurchases since 2012, representing more than 90% of available free cash flow generated over that time |
u | Achieved ROIC-adjusted of 28.2% |
u | Delivered $5.5 billion in cost savings against $6.5 billion of targeted savings through the end of 2018 |
u | Continued to make investments in future technology and innovation |
The Compensation Committee increasedkept Mr. Stevens’ base salary from $700,000 to $1,000,000at $1,100,000 based on his individual performance and the competitive market analysis provided by the Compensation Committee’s independent compensation consultant. TheFor 2017, the Compensation Committee awarded Mr. Stevens an annual equity grant of $2.875$3.725 million, consisting of 75 percent75% PSUs and 25 percent RSUs. Mr. Stevens participated in the one-time DSV Option Grant during 2015.
25% Stock Options.
The Compensation Committee elected to provide an individual STIP adjustmentawarded Mr. Stevens 40 points based on his results, highlighted above, for the 20152017 performance year in the amount of $125,000 for Mr. Stevens as a result of his performance.year. The total compensation for Mr. Stevens in 2015,2017, including salary, bonus, STIP and LTIP awards, and options is displayed below.
Pay Element | Majority of Pay Is At-Risk | Awarded Value | ||||
Base Salary | Fixed – Only Guaranteed Pay Element | $ | 1,000,000 | |||
STIP | Performance to Metrics | $ | 1,250,000 | |||
STIP Individual Adjustment | Performance – Based on Individual Results | $ | 125,000 | |||
PSUs(1) | Performance to Metrics and Stock Price | $ | 2,156,268 | |||
RSUs(2) | Performance to Stock Price | $ | 718,781 | |||
TOTAL | $ | 5,250,049 | ||||
DSV Options(1) | Performance to Stock Price and TSR Against OEM Peer Group | $ | 2,675,437 | |||
TOTAL WITH ONE-TIME AWARDS | $ | 7,925,486 |
Pay Element | Majority of Pay IsAt-Risk | Awarded Value | ||||
Base Salary | Only Fixed Pay Element | $1,100,000 | ||||
STIP | Performance to Metrics | $1,622,500 | ||||
PSUs(1) | Performance to Metrics and Stock Price | $3,076,744 | ||||
Stock Options(2) | Performance to Stock Price | $ 931,251 | ||||
TOTAL | $6,730,495 |
(1) | PSUs |
(2) |
|
Awarded value reflects the amount included in the Summary Compensation Table, excluding change in pension value and all other compensation. Realized compensation includes base salary, earned STIP, and all options exercised and stock vested during the year. 2017 realized compensation increased relative to the prior year reflecting 1) the vesting of the PSU award granted to Mr. Stevens in 2014, the year he was promoted to his current role; and 2) an increase in stock price at the time of vesting versus the prior year.
49 |
EXECUTIVE COMPENSATION
u | Compensation Decisions for Daniel Ammann |
Daniel Ammann, President
2017 performance highlights for Mr. Ammann include:
Led the successful sale of Opel/Vauxhall and GM Financial European businesses to PSA |
u | Successfully completed various restructuring activities in GM International |
u | Defined strategy for commercialization of autonomous vehicles through Transportation as a Service |
u | Oversaw rapid autonomous vehicle technology development and successful scaling of the team at GM Cruise |
u | Significant global sales growth at Cadillac in 2017, with strong increases in China |
u | Continued reshaping and reprioritization of overall GM business and product portfolio |
u | Drove ongoing continuous performance improvement through extensive focus on Operational Excellence |
Daniel Ammann,President
|
Effective January 1, 2015, theThe Compensation Committee increasedkept Mr. Ammann’s base salary from $1,000,000 to $1,200,000at $1,450,000 based on his individual performance and the competitive market analysis provided by the Compensation Committee’s independent compensation consultant. TheFor 2017, the Compensation Committee awarded Mr. Ammann an annual equity grant of $4.5$4.94 million, consisting of 75 percent75% PSUs and 25 percent RSUs. Mr. Ammann participated in the one-time DSV Option Grant during 2015.
25% Stock Options.
The Compensation Committee elected to provide an individualawarded Mr. Ammann 40 points based on his results, highlighted above, for the 2017 performance adjustment to Mr. Ammann’s 2015 STIP award for $150,000 due to the key business results achieved.year. The total compensation for Mr. Ammann in 2015,2017, including salary, bonus, STIP and LTIP awards, and options is displayed below.
Pay Element | Majority of Pay Is At-Risk | Awarded Value | ||||
Base Salary | Fixed – Only Guaranteed Pay Element | $ | 1,200,000 | |||
STIP | Performance to Metrics | $ | 1,500,000 | |||
STIP Individual Adjustment | Performance – Based on Individual Results | $ | 150,000 | |||
PSUs(1) | Performance to Metrics and Stock Price | $ | 3,375,006 | |||
RSUs(2) | Performance to Stock Price | $ | 1,125,015 | |||
TOTAL | $ | 7,350,021 | ||||
DSV Options(1) | Performance to Stock Price and TSR Against OEM Peer Group | $ | 4,187,636 | |||
TOTAL WITH ONE-TIME AWARDS | $ | 11,537,657 |
Pay Element | Majority of Pay IsAt-Risk | Awarded Value | ||||
Base Salary | Only Fixed Pay Element | $1,450,000 | ||||
STIP | Performance to Metrics | $2,138,800 | ||||
PSUs(1) | Performance to Metrics and Stock Price | $4,078,222 | ||||
Stock Options(2) | Performance to Stock Price | $1,234,378 | ||||
TOTAL | $8,901,400 |
(1) | PSUs |
(2) |
|
Awarded value reflects the amount included in the Summary Compensation Table, excluding change in pension value and all other compensation. Realized compensation includes base salary, earned STIP, and all options exercised and stock vested during the year. 2017 realized compensation increased relative to the prior year reflecting 1) the vesting of the PSU award granted to Mr. Ammann in 2014, the year he was promoted to his current role; and 2) an increase in stock price at the time of vesting versus the prior year.
50 |
EXECUTIVE COMPENSATION
u |
Compensation Decisions for Mark L. Reuss |
Mark L. Reuss,Executive Vice President, Global Product Development,
Purchasing and Supply Chain
|
2017 performance highlights for Mr. Reuss include:
u |
|
u | Led development ofall-new EME 1.0 battery architecture, providing flexible pack configurations at more than 30% lower cost |
u | Received the IHS Automotive Loyalty Award for the third straight year |
u | Developed a global electrification plan to lead the industry and announced that at least 20 new electric vehicles will be introduced by |
u | Received nearly 40 independent awards for the
|
u | Developed the first fuel cell midsized truck for use by the U.S. military and delivered fuel cells for use in the first unmanned submarine powered by our fuel cells for validation for the |
u | Awarded the Constructor Award for Chevrolet’s performance in motorsports winning manufacturers’ championships in Verizon IndyCar Series, NASCAR, NHRA Mello Yellow Series, IMSA, and |
u | Launched 25 vehicles globally |
u | Became the
|
u |
|
Effective January 1, 2015, theThe Compensation Committee increasedkept Mr. Reuss’ base salary from $850,000 to $1,100,000at $1,200,000 based on his individual performance and the competitive market analysis provided by the Compensation Committee’s independent compensation consultant. TheFor 2017, the Compensation Committee awarded Mr. Reuss an annual equity grant of $3.825$4.05 million, consisting of 75 percent75% PSUs and 25 percent RSUs. Mr. Reuss participated in the one-time DSV Option Grant in 2015.
25% Stock Options.
The Compensation Committee awarded an individual performance adjustment to the STIP payout of $140,000 for Mr. Reuss as a result of40 points based on his results, highlighted above, for the 2017 performance against goals.year. The total compensation for Mr. Reuss in 2015,2017, including salary, STIP and LTIP awards, is displayed below.
Pay Element | Majority of Pay IsAt-Risk | Awarded Value | ||||
Base Salary | Only Fixed Pay Element | $1,200,000 | ||||
STIP | Performance to Metrics | $1,770,000 | ||||
PSUs(1) | Performance to Metrics and Stock Price | $3,345,168 | ||||
Stock Options(2) | Performance to Stock Price | $1,012,504 | ||||
TOTAL | $7,327,672 |
(1) | PSUs are subject to performance vesting; value reflects grant date fair value at target performance for Relative ROIC-adjusted awards and probable performance results from the Monte Carlo analysis to value Relative TSR awards. |
(2) | Stock Options are subject to time-based vesting. |
Awarded value reflects the amount included in the Summary Compensation Table, excluding change in pension value and all other compensation. Realized compensation includes base salary, earned STIP, and all options exercised and stock vested during the year. 2017 realized compensation increased relative to the prior year reflecting 1) the vesting of the PSU award granted to Mr. Reuss in 2014, the year he was promoted to his current role; and 2) an increase in stock price at the time of vesting versus the prior year.
51 |
EXECUTIVE COMPENSATION
u | Compensation Decisions for Alan S. Batey |
Alan S. Batey, Executive Vice President & President, North America
2017 performance highlights for Mr. Batey include:
u | Achieved record margins in North America and delivered EBIT-adjusted margins of greater than 10% for the third straight year |
u | Increased GM crossover retail sales in the United States by 21% over 2016 resulting in the best year in history |
u | Increased average transaction prices in the United States to $35,600, exceeding the industry by $3,800 |
u | Increased Denali sales in the United States where 29% of all GMC vehicles sold were Denali |
u | Awarded a third straight OEM IHS Customer Loyalty award for GM U.S. |
u | Delivered the best retail sales since 2008 in Canada with all four brands, Chevrolet +13.6%, Buick +15.1%, GMC +18.7%, and Cadillac +10.9%, experiencing double digit increases |
u | Earned the J.D. Power CSI and SSI awards for Buick in the United States for the second consecutive year |
Effective January 1, 2017, Mr. Batey’s base salary was increased from $950,000 to $1,025,000. The increase was supported by the competitive market analysis provided by the Compensation Committee’s independent compensation consultant. For 2017, the Compensation Committee awarded Mr. Batey an annual equity grant of $2.69 million, consisting of 75% PSUs and 25% Stock Options.
The Compensation Committee awarded Mr. Batey 35 points based on his results, highlighted above, for the 2017 performance year. The total compensation for Mr. Batey in 2017, including salary, STIP and LTIP awards, is displayed below.
Pay Element | Majority of Pay IsAt-Risk | Awarded Value | ||||
Base Salary | Only Fixed Pay Element | $1,025,000 | ||||
STIP | Performance to Metrics | $1,447,800 | ||||
PSUs(1) | Performance to Metrics and Stock Price | $2,224,928 | ||||
Stock Options(2) | Performance to Stock Price | $ 673,426 | ||||
TOTAL | $5,371,154 |
(1) | PSUs are subject to performance vesting; value reflects grant date fair value at target performance for Relative ROIC-adjusted awards and probable performance results from the Monte Carlo analysis to value Relative TSR awards. |
(2) | Stock Options are subject to time-based vesting. |
Awarded value reflects the amount included in the Summary Compensation Table, excluding change in pension value and all other compensation. Realized compensation includes base salary, earned STIP, and all options exercised and stock vested during the year. 2017 realized compensation increased relative to the prior year reflecting 1) the vesting of the PSU award granted to Mr. Batey in 2014, the year he was promoted to his current role; and 2) an increase in stock price at the time of vesting versus the prior year.
52 |
EXECUTIVE COMPENSATION
u | Compensation Decisions for Karl-Thomas Neumann |
Karl-Thomas Neumann, Former Executive Vice President & President, Europe
Dr. Neumann played a key role in leading the Opel/Vauxhall organizations through the sale to PSA while maximizing business results versus the plan and maintained the consistency of the workforce that transitioned to PSA. He continued to navigate the teams to achieve a successful closing and worked through issues with all stakeholders in a constructive manner. |
Effective January 1, 2017, Dr. Neumann’s base salary was€811,864 supported by the competitive market analysis provided by the Compensation Committee’s independent compensation consultant. For 2017, the Compensation Committee awarded Dr. Neumann an annual equity grant of $2.37 million, consisting of 75% PSUs and 25% Stock Options.
Based on performance to goals for 2017, the Compensation Committee awarded Dr. Neumann 25 points for his performance assessment under the STIP. In addition, the Committee awarded Dr. Neumann aone-time transaction success incentive (“TSI”) award for his efforts in leading the Opel/Vauxhall organization through the close of the sale to PSA. The total compensation for Dr. Neumann in 2017, including salary, bonus, STIP and LTIP awards, and options is displayed below.
Pay Element | Majority of Pay Is At-Risk | Awarded Value | ||||
Base Salary | Fixed – Only Guaranteed Pay Element | $ | 1,100,000 | |||
STIP | Performance to Metrics | $ | 1,375,000 | |||
STIP Individual Adjustment | Performance – Based on Individual Results | $ | 140,000 | |||
PSUs(1) | Performance to Metrics and Stock Price | $ | 2,868,759 | |||
RSUs(2) | Performance to Stock Price | $ | 956,253 | |||
TOTAL | $ | 6,440,012 | ||||
DSV Options(1) | Performance to Stock Price and TSR Against OEM Peer Group | $ | 3,559,495 | |||
TOTAL WITH ONE-TIME AWARDS | $ | 9,999,507 |
Pay Element | Majority of Pay IsAt-Risk | Awarded Value | ||||
Base Salary(1) | Only Fixed Pay Element | $ 916,936 | ||||
STIP(2) | Performance to Metrics | $1,276,317 | ||||
PSUs(3) | Performance to Metrics and Stock Price | $1,961,676 | ||||
Stock Options(4) | Performance to Stock Price | $ 593,751 | ||||
Other(5) | Performance to Transaction | $2,000,000 | ||||
TOTAL | $6,748,680 |
(1) | The salary of €811,864 was paid in euros and converted to U.S. dollars, applying an average foreign exchange rate for the period from January 1, 2017 to December 31, 2017 during which compensation was earned €1 = $1.1294. |
(2) | The STIP award of €1,045,200, was paid in euros and converted using the exchange rate on date of payment. €1 = $1.221122 |
(3) | PSUs |
|
(5) | The TSI was paid based on a successful close of the Opel/Vauxhall sale to PSA. The TSI award was based in U.S. dollars and paid in euros. |
Awarded value reflects the amount included in the Summary Compensation Table, excluding change in pension value and all other compensation Realized compensation includes base salary, earned STIP, TSI award, and all options exercised and stock vested during the year.
53 |
EXECUTIVE COMPENSATION
Craig B. Glidden,Executive Vice President & General Counsel
|
Mr. Glidden joined General Motors as Executive Vice President & General Counsel on March 1, 2015, with an annual base salary of $700,000. Effective April 1, 2015, with Compensation Committee approval, Mr. Glidden received a one-time cash sign-on bonus in the amount of $500,000 and an equity sign-on RSU grant of 69,407 shares with a grant date value of $2.55 million to replace awards being forfeited at his previous employer. Additionally, the Compensation Committee authorized an annual equity grant of $1.925 million, consisting of 75 percent PSUs and 25 percent RSUs. Mr. Glidden also participated in the one-time DSV Option Grant in 2015.
The Compensation Committee awarded an individual performance adjustment to the STIP payout of $70,000 for Mr. Glidden as a result of performance against goals. The total compensation for Mr. Glidden in 2015, including salary, bonus, STIP and LTIP awards, options, and sign-on awards is displayed below.
Pay Element | Majority of Pay Is At-Risk | Awarded Value | ||||
Base Salary | Fixed – Only Guaranteed Pay Element | $ | 583,333 | |||
STIP | Performance to Metrics | $ | 875,000 | |||
STIP Individual Adjustment | Performance – Based on Individual Results | $ | 70,000 | |||
PSUs(1) | Performance to Metrics and Stock Price | $ | 1,443,772 | |||
RSUs(2) | Performance to Stock Price | $ | 481,257 | |||
TOTAL | $ | 3,453,362 | ||||
DSV Options(1) | Performance to Stock Price and TSR Against OEM Peer Group | $ | 1,791,380 | |||
Sign-On Cash | One-Time Sign-On Cash Award | $ | 500,000 | |||
Sign-On RSUs(2) | Performance to Stock Price | $ | 2,550,013 | |||
TOTAL WITH ONE-TIME AWARDS | $ | 8,294,755 |
Compensation Policies and Governance Practices
Stock Ownership Requirements |
In June 2014,The Company requires our senior leaders to own stock in conjunction with shareholder approval of the STIP and LTIP, the Compensation Committee implemented stock ownership requirementsCompany to more closely align the interests of executivessenior leaders with those of our shareholders. The requirements:
cover all senior leaders;
set five years as the time frame to meet ownership requirements;
establish a multiple of each executive’s base salary on the date they are first covered;
make it possible to meet ownership requirements by owning either a multiple of base salary or a required number of shares; and
call for senior leaders to hold shares in order to meet the ongoing ownership requirements.
The table to the rightbelow shows the stock ownership requirement by level in the Company as well as ownership requirements for each of our NEOs.
Position | Ownership Requirement as a Multiple of Salary | |||
• CEO | 6x | |||
• President | 4x | |||
•Executive Vice President | ||||
• Senior Vice President | 3x | |||
• Senior Executive | 1x |
The share requirement to meet ownership guidelines is based on the 12-month trailing stock price from June 30 in the year the senior leader is first covered by stock ownership requirements. As of December 31, 2015,2017, all NEOs have met or are on track to meet stock ownership requirements by their respective dates.
Policy on Recoupment of Incentive Compensation |
We have adopted a corporate policy to recover incentive compensation paid to executive officers in cases where financial statements are restated because of employee fraud, negligence, or intentional misconduct. Under this clawback policy, which is posted on our website atwww.gm.com/investorgm.com/investors/corporate-governance, under “Corporate Governance,” if ourthe Board or an appropriate Board Committee determines any bonus, retention award, or short or long-term incentive compensation has been paid to any executive officer based on materially inaccurate misstatement of earnings, revenues, gains, or other criteria, including reputational harm, the Board or Compensation Committee will take the action it deems necessary to recover the compensation paid, remedy the misconduct, and prevent its recurrence. For this purpose, a financial statement or performance metric will be treated as materially inaccurate when an employee knowingly engaged in providing inaccurate information or knowingly failed to timely correct information relating to those financial statements or performance metrics. We will continue to review our policy to ensure it is consistent with all legal requirements and in the best interests of the Company and its shareholders.
Securities Trading Policy |
Our securities trading policy prohibits our employees from buying or selling GM securities when in possession of material nonpublic information. Any sale or purchase of common stock by directors, and executive officers, and all other senior leaders must be made according to a Rule 10b5-1 plan or duringpre-established periods after receiving preclearance by a member of the GM Legal Staff.
Staff or according to preapproved Rule10b5-1 plan.
Trading in GM derivatives (i.e.(i.e., puts or calls), engaging in short sales, and pledging of GM securities is also prohibited. All GM executive officers are in compliance with the policy of not pledging any shares of common stock. This policy is posted on our website atwww.gm.com/investorgm.com/investors/corporate-governance., under “Corporate Governance.”
Tax Considerations |
IRC Section 162(m) generally disallows federal tax deductions for compensation in excess of $1 million paid to the CEO and the next three of our highest-paid officers (other than the CFO) whose compensation is required to be reported in the Summary Compensation Table ofin this Proxy Statement (“(‘‘Covered Executives”Executives’’). Certain performance-based compensation is not subject to this deduction limitation.limitation as applicable for fiscal year 2017. Generally, we strive to maximize the tax deductibility of compensation arrangements. The Compensation Committee, however, may award compensation that is not fully tax deductible if it deems it appropriate as compensation designed to attract and retain talented executives in the highly competitive market for talent.
STIP awards for performance during 2017 are paid based on the achievement of performance measures approved by shareholders in 2014 as part of the 2014 STIP. Because the STIP awards for performance during 2017 are intended to be deductible as performance-based compensation under 162(m), the Compensation Committee set the maximum award for each NEO (except the CFO)Covered Executive at $7.5 million. Incentive amounts equal to the maximum will be funded for each covered executive officerCovered Executive once a threshold level of positive EBIT-AdjustedEBIT-adjusted has been achieved. The Compensation Committee then exercises negative discretion, as needed, to determine actual incentive awards based on other business and individual performance, as described in the “Short-Term“Executive Compensation—Performance Results and Compensation Decisions—2017 Short-Term Incentive Plan” section of the CD&A.on page 47.
54 |
EXECUTIVE COMPENSATION
The Tax Cuts and Jobs Act, enacted on December 22, 2017, substantially modifies IRC Section 162(m) and, among other things, eliminates the performance-based compensation exception to the $1 million deduction limit effective as of January 1, 2018. As a result, beginning in 2018, compensation paid to Covered Executives in excess of $1 million will generally be nondeductible, whether or not it is performance-based. In addition, beginning in 2018, the Covered Executives will include any individual who served as the CEO or CFO at any time during the taxable year and the next three of our highest paid officers (other than the CEO and CFO) for the taxable year, and once an individual becomes a Covered Executive for any taxable year beginning after December 31, 2016, that individual will remain a Covered Executive for all future years, including following any termination of employment.
The Tax Cuts and Jobs Act includes a transition relief rule pursuant to which the changes to IRC Section 162(m) described above will not apply to compensation payable pursuant to a written binding contract that was in effect on November 2, 2017 and is not materially modified after that date. To the extent applicable to our existing arrangements, the Compensation Committee may avail itself of this transition relief rule. However, because of uncertainties as to the application and interpretation of the transition relief rule, no assurances can be given at this time that our existing arrangements, even if in place on November 2, 2017, will meet the requirements of the transition relief rule. Moreover, to maintain flexibility in attracting and retaining talented executives, the Compensation Committee does not limit its actions with respect to executive compensation to preserve deductibility under IRC Section 162(m) if the Compensation Committee determines that doing so is in the best interests of our shareholders.
u |
Compensation Committee and Consultant Independence |
Our Compensation Committee is composed entirely of independent directors as determined by the Board under NYSE standards and as defined for various regulatory purposes. Farient Advisors assisted the Compensation Committee in 2015.2017. Farient Advisors is an independent compensation consulting firm that takes direction from and is solely responsible to the Compensation Committee. The Compensation Committee is also aided in its deliberations byin-house legal counsel.
Under its charter, the Compensation Committee has the authority to hire outside consultants and advisors at the Company’s expense. The Compensation Committee retains the services of Farient Advisors for advice on issues related to the compensation of NEOs and other executivecompensation-related matters. A representative of Farient Advisors attended all Compensation Committee meetings, either in person or via telephone, consulted with and advised the Compensation Committee members on executive compensation, including the structure and amounts of various pay elements, and developed executive benchmarking data for the Compensation Committee. Farient Advisors provided no services to the Company’s management.
The Compensation Committee annually reviews the performance of the compensation consultant and considers the following factors when assessing consultant independence in accordance with NYSE standards:
Services provided to GM management outside of the services provided to the Compensation Committee;
Fees paid as a percentage of Farient Advisors’ total revenue;
Policies and procedures of Farient Advisors designed to prevent conflicts of interest;
Any business or personal relationships between members of the Compensation Committee and Farient Advisors;
Stock ownership by employees of Farient Advisors; and
Any business or personal relationships between GM and Farient Advisors.
The Compensation Committee reviewed the performance and independence of Farient Advisors and no performance or independence issues were identified.determined that Farient Advisors was independent based on the standards above.
Compensation Risk Assessment |
During 2015,2017, the Compensation Committee reviewed and discussed the impact of executive compensation programs on organizational risk. The Compensation Committee discussed plans and reviewed risk mitigation features in each of the plans to evaluate, with the assistance of our audit, legal and risk management organization,organizations, the overall impact that compensation programs have on organizational risk. The Compensation Committee determined compensation programs have sufficient risk mitigation features and do not encourage or reward employees for taking excessive or unnecessary risk. The mix of our shortshort-term and long-term compensation programs appropriately rewardrewards employees while balancing risk through the delayed payment of long-term awards.
As a result of the compensation risk review completed on December 8, 2015,12, 2017, the Compensation Committee determined the overall risk of compensation programs exposing the organization to unnecessary or excessive risks is low.
Employment and Termination Agreements |
The Company has no employment or termination agreements with any of our 20152017 NEOs. All NEOs are eligible to receiveparticipate in the same severance treatmentExecutive Severance Program available to other executive employees.
55 |
EXECUTIVE COMPENSATION
The Compensation Committee has reviewed and discussed with management the CD&A and, based on that review and discussion, has recommended to the Board of Directors that the CD&A be included in this Proxy Statement and incorporated by reference in the GM 20152017 Annual Report on Form10-K.
Compensation Committee
Carol M. Stephenson (Chair)
Joseph Jimenez
James J. Mulva
Patricia F. Russo
56 | |||
Name and Principal Position(1)(2) | Year | Salary ($) | Bonus(3) ($) | Stock Awards(4) ($) | Option Awards(5) ($) | Nonequity Incentive Plan Compensation(6) ($) | Change in Pension Value and NQ Deferred Compensation Earnings(7) ($) | All Other Compensation(8) ($) | Total ($) | |||||||||
Mary T. Barra(1) | 2015 | 1,750,000 | – | 12,000,004 | 11,167,029 | 3,062,500 | 12,012 | 597,118 | 28,588,663 | |||||||||
Chief Executive | 2014 | 1,567,803 | – | 11,760,567 | – | 2,072,000 | 349,926 | 412,532 | 16,162,828 | |||||||||
Officer | 2013 | 750,000 | – | 4,446,504 | – | – | – | 36,636 | 5,233,140 | |||||||||
Charles K. Stevens, III | 2015 | 1,000,000 | – | 2,875,049 | 2,675,437 | 1,375,000 | – | 176,738 | 8,102,224 | |||||||||
Executive VicePresident &Chief FinancialOfficer | 2014 | 691,667 | – | 3,177,354 | – | 647,500 | 265,201 | 113,110 | 4,894,832 | |||||||||
Daniel Ammann | 2015 | 1,200,000 | – | 4,500,021 | 4,187,636 | 1,650,000 | – | 262,420 | 11,800,077 | |||||||||
President | 2014 | 990,530 | – | 6,310,564 | – | 925,000 | – | 263,252 | 8,489,346 | |||||||||
2013 | 750,000 | – | 4,481,562 | – | – | – | 28,475 | 5,260,037 | ||||||||||
Mark L. Reuss | 2015 | 1,100,000 | – | 3,825,012 | 3,559,495 | 1,515,000 | – | 199,629 | 10,199,136 | |||||||||
Executive VicePresident,Global ProductDevelopment,Purchasing andSupply Chain | 2014 | 846,212 | – | 7,458,881 | – | 786,300 | 275,588 | 110,796 | 9,477,777 | |||||||||
Craig B. Glidden | 2015 | 583,333 | 500,000 | 4,475,042 | 1,791,380 | 945,000 | – | 145,064 | 8,439,819 | |||||||||
Executive VicePresident& GeneralCounsel |
Name and Principal Position(1)
| Year
| Salary(2) ($)
| Bonus(3) ($)
| Stock Awards(4) ($)
| Option Awards(5) ($)
| Nonequity Incentive Plan Compensation(6) ($)
|
Change in Pension Value and NQ Deferred Compensation Earnings(7) ($)
| All Other Compensation(8) ($)
| Total ($)
| |||||||||||||||||||||||||||
Mary T. Barra Chairman and Chief Executive Officer |
|
2017
|
|
| 2,100,000
|
|
| —
|
|
| 10,737,570
|
|
| 3,250,003
|
|
| 4,956,000
|
|
| 52,792
|
|
| 861,683
|
|
| 21,958,048
|
| |||||||||
|
2016
|
|
| 2,000,000
|
|
| —
|
|
| 13,000,036
|
|
| —
|
|
| 6,760,000
|
|
| 181,777
|
|
| 640,246
|
|
| 22,582,059
|
| ||||||||||
|
2015
|
|
| 1,750,000
|
|
| —
|
|
| 12,000,004
|
|
| 11,167,029
|
|
| 3,062,500 �� |
|
| 12,012
|
|
| 597,118
|
|
| 28,588,663
|
| ||||||||||
Charles K. Stevens, III Executive Vice President and Chief Financial Officer |
|
2017
|
|
| 1,100,000
|
|
| —
|
|
| 3,076,744
|
|
| 931,251
|
|
| 1,622,500
|
|
| 54,114
|
|
| 316,430
|
|
| 7,101,039
|
| |||||||||
|
2016
|
|
| 1,100,000
|
|
| —
|
|
| 3,450,007
|
|
| —
|
|
| 2,673,800
|
|
| 135,146
|
|
| 244,132
|
|
| 7,603,085
|
| ||||||||||
|
2015
|
|
| 1,000,000
|
|
| —
|
|
| 2,875,049
|
|
| 2,675,437
|
|
| 1,375,000
|
|
| —
|
|
| 176,738
|
|
| 8,102,224
|
| ||||||||||
Daniel Ammann President |
|
2017
|
|
| 1,450,000
|
|
| —
|
|
| 4,078,222
|
|
| 1,234,378
|
|
| 2,138,800
|
|
| —
|
|
| 356,918
|
|
| 9,258,318
|
| |||||||||
|
2016
|
|
| 1,450,000
|
|
| —
|
|
| 4,700,032
|
|
| —
|
|
| 3,513,100
|
|
| —
|
|
| 560,852
|
|
| 10,223,984
|
| ||||||||||
|
2015
|
|
| 1,200,000
|
|
| —
|
|
| 4,500,021
|
|
| 4,187,636
|
|
|
1,650,000
|
|
| —
|
|
| 262,420
|
|
| 11,800,077
|
| ||||||||||
Mark L. Reuss Executive Vice President, Global Product Development, Purchasing and Supply Chain |
|
2017
|
|
| 1,200,000
|
|
| —
|
|
| 3,345,168
|
|
| 1,012,504
|
|
| 1,770,000
|
|
| 54,390
|
|
| 344,446
|
|
| 7,726,508
|
| |||||||||
|
2016
|
|
| 1,200,000
|
|
| —
|
|
| 3,900,018
|
|
| —
|
|
| 2,905,000
|
|
| 134,777
|
|
| 272,866
|
|
| 8,412,661
|
| ||||||||||
|
2015
|
|
| 1,100,000
|
|
| —
|
|
| 3,825,012
|
|
| 3,559,495
|
|
| 1,515,000
|
|
| —
|
|
| 199,629
|
|
| 10,199,136
|
| ||||||||||
Alan S. Batey Executive Vice President, & President, North America |
|
2017
|
|
| 1,025,000
|
|
| —
|
|
| 2,224,928
|
|
| 673,426
|
|
| 1,447,800
|
|
| 316,601
|
|
| 287,373
|
|
| 5,975,128
|
| |||||||||
|
2016
|
|
| 950,000
|
|
| —
|
|
| 2,700,035
|
|
| —
|
|
| 2,406,900
|
|
| 133,151
|
|
| 225,078
|
|
| 6,415,164
|
| ||||||||||
Karl-Thomas Neumann Former Executive Vice President & President, Europe
|
|
2017
|
|
| 916,936
|
|
| 2,000,000
|
|
| 1,961,676
|
|
| 593,751
|
|
| 1,276,317
|
|
| 126,796
|
|
| 12,563
|
|
| 6,888,039
|
|
(1) | Titles in the table reflect the |
(2) | Dr. Neumann’s salary, which was paid in euros, has been converted to U.S. dollars, applying an average foreign exchange rate for the |
(3) |
|
(4) | Stock Awards displays the grant date fair value of PSUs issued under the LTIP, computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic |
Maximum PSU Grant | Maximum PSU Grant Value | |||||||||||||
Value of PSU Awards at Target and Maximum Performance
| Value of PSU Awards at Target and Maximum Performance
| |||||||||||||
(#) | ($) | 2017 Target ($) | 2017 Maximum | |||||||||||
Mary T. Barra | 477,834 | 18,000,007 |
| 9,750,028
|
|
| 19,500,056
|
|
| |||||
Charles K. Stevens, III | 114,482 | 4,312,537 |
| 2,793,782
|
|
| 5,587,564
|
|
| |||||
Daniel Ammann | 179,188 | 6,750,012 |
| 3,703,146
|
|
| 7,406,291
|
|
| |||||
Mark L. Reuss | 152,310 | 5,737,518 |
| 3,037,518
|
|
| 6,075,036
|
|
| |||||
Craig B. Glidden | 78,594 | 2,887,544 | ||||||||||||
Alan S. Batey
|
| 2,020,307
|
|
| 4,040,614
|
|
| |||||||
Karl-Thomas Neumann
|
| 1,781,264
|
|
| 3,562,527
|
|
|
57 |
EXECUTIVE COMPENSATION
(5) | Option Awards displays the grant |
(6) | Each NEO was eligible for a payment under the STIP for |
(7) | These amounts represent the actuarial change in the present value of the executive’s accrued benefit for |
(8) | Totals for amounts included as “All Other Compensation” are described in the table |
All Other Compensation
M.T. Barra | C.K. Stevens | D. Ammann | M.L. Reuss | C.B. Glidden | ||||||
($) | ($) | ($) | ($) | ($) | ||||||
Perquisites and Other Personal Benefits(1) | 286,848 | 32,216 | 127,150 | 37,440 | 31,058 | |||||
Employer Contributions to Savings Plans(2) | 299,320 | 138,850 | 133,000 | 157,178 | 45,500 | |||||
Life and Other Insurance Benefits(3) | 8,511 | 5,672 | 2,270 | 5,011 | 2,862 | |||||
Other(4) | 2,439 | – | – | – | 65,644 | |||||
TOTAL | 597,118 | 176,738 | 262,420 | 199,629 | 145,064 |
M.T. Barra ($) | C.K. Stevens ($) | D. Ammann ($) | M.L. Reuss ($) | A.S.��Batey ($) | K.T. Neumann ($) | |||||||||||||||||||||
Perquisites and Other Personal Benefits(1)
|
| 233,323
|
|
| 39,257
|
|
| 95,948
|
|
| 44,350
|
|
| 35,570
|
|
| 12,563
|
| ||||||||
Employer Contributions to Savings Plans(2)
|
| 615,600
|
|
| 270,428
|
|
| 256,524
|
|
| 294,300
|
|
| 246,913
|
|
| —
|
| ||||||||
Life and Other Insurance Benefits(3)
|
| 12,760
|
|
| 6,745
|
|
| 4,446
|
|
| 5,796
|
|
| 4,890
|
|
| —
|
| ||||||||
TOTAL
|
| 861,683
|
|
| 316,430
|
|
| 356,918
|
|
| 344,446
|
|
| 287,373
|
|
| 12,563
|
|
(1) | See Perquisites and Other Personal Benefits table below for additional information. |
(2) | Includes employer contributions totax-qualified and |
(3) | Includes premiums paid by the Company for Group Variable Universal Life insurance for executives. Executives are responsible for any ordinary income taxes resulting from the cost of theGM-paid premiums. For Ms. Barra, amounts also include the Company’s cost of premiums for providing personal accident insurance for members of the Board. | |
Perquisites and Other Personal Benefits
M.T. Barra | C.K. Stevens | D. Ammann | M.L. Reuss | C.B. Glidden | ||||||||||||||||||||||||||||||||
($) | ($) | ($) | ($) | ($) | M.T. Barra ($)
| C.K. Stevens ($)
| D. Ammann ($)
| M.L. Reuss ($)
| A.S. Batey ($)
| K.T. Neumann ($)
| ||||||||||||||||||||||||||
Personal Travel(1) | 187,906 | – | – | – | – |
| 168,085
|
|
| —
|
|
| 14,690
|
|
| —
|
|
| —
|
|
| —
|
| |||||||||||||
Security(2) | 47,280 | – | 87,750 | – | – |
| 12,597
|
|
| —
|
|
| 37,511
|
|
| —
|
|
| —
|
|
| —
|
| |||||||||||||
Company Vehicle Programs(3) | 35,802 | 21,856 | 28,543 | 22,080 | 16,938 |
| 37,031
|
|
| 23,647
|
|
| 33,387
|
|
| 28,990
|
|
| 25,210
|
|
| 12,563
|
| |||||||||||||
Executive Physical(4) | 5,500 | – | – | 5,000 | 5,250 |
| 5,250
|
|
| 5,250
|
|
| —
|
|
| 5,000
|
|
| —
|
|
| —
|
| |||||||||||||
Financial Counseling(5) | 10,360 | 10,360 | 10,857 | 10,360 | 8,870 |
| 10,360
|
|
| 10,360
|
|
| 10,360
|
|
| 10,360
|
|
| 10,360
|
|
| —
|
| |||||||||||||
Other(6)
|
| —
|
|
| —
|
|
| —
|
|
| —
|
|
| —
|
|
| —
|
| ||||||||||||||||||
TOTAL | 286,848 | 32,216 | 127,150 | 37,440 | 31,058 |
| 233,323
|
|
| 39,257
|
|
| 95,948
|
|
| 44,350
|
|
| 35,570
|
|
| 12,563
|
|
(1) | Personal travel pursuant to Company policy as discussed on page |
(2) | Amounts include the actual costs of residential security system |
(3) | Company vehicle programs |
(4) | Costs associated with executive physicals for each executive with approved providers. |
(5) | Costs associated with financial counseling and estate planning services with approved providers. |
(6) | Occasionally unused tickets from sponsorship agreements are made available for personal use. Tickets are included in sponsorship agreements and typically result in no incremental costs to the Company. The value represents the incremental costs associated with the personal use of tickets to |
58 |
EXECUTIVE COMPENSATION
u |
GrantsSTIP awards for the 2017 performance year were made under the terms of the 2014 STIP, PSU equity grants were made to each NEO under the terms of the 2014 LTIP. Each grant consistedLTIP, and Stock Options were granted under the terms of PSUs and RSUs for each NEO.the 2017 LTIP. PSUs, which vest and deliver at the end of the performance period, will be earned
at a level between 00% and 200 percent200% of target. PSUs are based on the achievement of performance conditions relating to ROICRelative ROIC-adjusted and Global Market ShareRelative TSR over a three-year performance period from January 1, 20152017 to December 31, 2017.2019. The RSUsStock Options will vest ratably over the three-year period.
On July 28, 2015, the Compensation Committee granted stock options in exchange for executives agreeing to non-compete and non-solicitation terms. On February 15, 2017, 40 percent of the option grant will vest, and the remaining 60 percent will vest on each February 15 in 2018, 2019, and 2020 only if the Company meets the TSR performance conditions as described above on page 45.
Estimated Future Payouts Under Non-Equity Incentive Plan Awards | Estimated Future Payouts Under Equity Incentive Plan Awards | All Other Stock Awards: Number of Shares of | All Other Option Awards: Number of Securities | Exercise or Base Price of Option | Grant Date Fair Value of Stock |
Estimated Future Payouts UnderNon-Equity Incentive Plan Awards | Estimated Future Payouts Under Equity Incentive Plan Awards | All Other Stock Awards: Number of Shares of Stock or Units (#) | All Other Option Awards: Number of Securities Underlying Options (#) | Exercise or Base Price of Option Awards ($/share) | Grant Date Fair Value of Stock and Option Awards($)(1) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Name | Award Type | Grant Date | Approval Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | Stock or Units (#) | Underlying Options (#) | Awards ($/share) | and Options Awards($)(1) | Award Type | Grant Date | Approval Date | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | ||||||||||||||||||||||||||||||||||||||||||||||
Mary T. Barra | STIP | 1/20/2015 | 1/20/2015 | 382,813 | 3,062,500 | 6,125,000 | STIP | 1/1/2017 | 2/1/2017 | 525,000 | 4,200,000 | 8,400,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mary T. Barra | Options | 6/7/2017 | 2/1/2017 | 652,611 | 34.34 | 3,250,003 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
RSU | 2/11/2015 | 1/20/2015 | 79,639 | 3,000,001 | PSU | 2/14/2017 | 2/1/2017 | 43,200 | 261,816 | 523,632 | 10,737,570 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PSU | 2/11/2015 | 1/20/2015 | 59,730 | 238,917 | 477,834 | 9,000,003 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DSV | 7/28/2015 | 7/28/2015 | 1,561,822 | 1,561,822 | 1,561,822 | 1,041,215 | 31.32 | 11,167,029 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Options(2) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Charles K. | STIP | 1/20/2015 | 1/20/2015 | 156,250 | 1,250,000 | 2,500,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Stevens, III | RSU | 2/11/2015 | 1/20/2015 | 19,081 | 718, 781 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PSU | 2/11/2015 | 1/20/2015 | 14,311 | 57,241 | 114,482 | 2,156,268 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DSV | 7/28/2015 | 7/28/2015 | 374,187 | 374,187 | 374,187 | 249,458 | 31.32 | 2,675,437 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Charles K. Stevens, III | STIP | 1/1/2017 | 2/1/2017 | 171,875 | 1,375,000 | 2,750,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Options | 6/7/2017 | 2/1/2017 | 186,998 | 34.34 | 931,251 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Options(2) | PSU | 2/14/2017 | 2/1/2017 | 12,378 | 75,021 | 150,042 | 3,076,744 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Daniel Ammann | STIP | 1/20/2015 | 1/20/2015 | 187,500 | 1,500,000 | 3,000,000 | STIP | 1/1/2017 | 2/1/2017 | 226,563 | 1,812,500 | 3,625,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
RSU | 2/11/2015 | 1/20/2015 | 29,865 | 1,125,015 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PSU | 2/11/2015 | 1/20/2015 | 22,399 | 89,594 | 179,188 | 3,375,006 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DSV | 7/28/2015 | 7/28/2015 | 585,683 | 585,683 | 585,683 | 390,456 | 31.32 | 4,187,636 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Daniel Ammann | Options | 6/7/2017 | 2/1/2017 | 247,867 | 34.34 | 1,234,378 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Options(2) | PSU | 2/14/2017 | 2/1/2017 | 16,408 | 99,440 | 198,880 | 4,078,222 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mark L. Reuss | STIP | 1/20/2015 | 1/20/2015 | 171,875 | 1,375,000 | 2,750,000 | STIP | 1/1/2017 | 2/1/2017 | 187,500 | 1,500,000 | 3,000,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Mark L. Reuss | Options | 6/7/2017 | 2/1/2017 | 203,314 | 34.34 | 1,012,504 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
RSU | 2/11/2015 | 1/20/2015 | 25,385 | 956,253 | PSU | 2/14/2017 | 2/1/2017 | 13,458 | 81,566 | 163,132 | 3,345,168 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Alan S. Batey | STIP | 1/1/2017 | 2/1/2017 | 160,163 | 1,281,300 | 2,562,600 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Options | 6/7/2017 | 2/1/2017 | 135,226 | 34.34 | 673,426 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PSU | 2/11/2015 | 1/20/2015 | 19,039 | 76,155 | 152,310 | 2,868,759 | PSU | 2/14/2017 | 2/1/2017 | 8,951 | 54,251 | 108,502 | 2,224,928 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||
Karl-Thomas Neumann | STIP | 1/1/2017 | 2/1/2017 | 164,063 | 1,312,500 | 2,625,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Options | 6/7/2017 | 2/1/2017 | 119,227 | 34.34 | 593,751 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DSV | 7/28/2015 | 7/28/2015 | 497,831 | 497,831 | 497,831 | 331,888 | 31.32 | 3,559,495 | PSU | 2/14/2017 | 2/1/2017 | 7,892 | 47,832 | 95,664 | 1,961,676 | |||||||||||||||||||||||||||||||||||||||||||||||||||||
Options(2) | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Craig B. Glidden | STIP | 1/20/2015 | 1/20/2015 | 109,375 | 875,000 | 1,750,000 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
RSU | 4/1/2015 | 1/20/2015 | 13,099 | 481,257 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
RSU | 4/1/2015 | 1/20/2015 | 69,407 | (3) | 2,550,013 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
PSU | 4/1/2015 | 1/20/2015 | 9,825 | 39,297 | 78,594 | 1,443,772 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
DSV | 7/28/2015 | 7/28/2015 | 250,542 | 250,542 | 250,542 | 167,029 | 31.32 | 1,791,380 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Options(2) |
(1) | This column shows the aggregate grant date fair value of PSUs |
59 |
EXECUTIVE COMPENSATION
Option Awards | Stock Awards(1) | ||||||||||
Equity | |||||||||||
Equity | Incentive | ||||||||||
Equity | Incentive | Plan Awards: | |||||||||
Incentive | Plan Awards: | Market or | |||||||||
Number of | Number of | Plan Awards: | Market | Number of | Payout Value | ||||||
Securities | Securities | Number of | Number | Value of | Unearned | of Unearned | |||||
Underlying | Underlying | Securities | of Shares | Shares or | Shares, Units, | Shares, Units, | |||||
Unexercised | Unexercised | Underlying | of Units or | Units of | or Other | or Other | |||||
Options | Options | Unexercised | Option | Option | Stock That | Stock That | Rights That | Rights That | |||
Grant | Exercisable | Unexercisable | Unearned | Exercise | Expiration | Have Not | Have Not | Have Not | Have Not | ||
Name | Date | (#) | (#) | Options (#) | Price ($) | Date | Vested (#) | Vested ($) | Vested (#) | Vested ($) | |
Mary T. Barra | 7/28/2015 | – | 1,041, 215(2) | 1,561,822(3) | 31.32 | 7/28/2025 | |||||
2/11/2015 | 79,639(4) | 2,708,522 | 238,917(5) | 8,125,567 | |||||||
6/11/2014 | 46,143(4) | 1,569,323 | 207,642(5) | 7,061,904 | |||||||
2/13/2014 | 37, 511(6) | 1,275,749 | |||||||||
3/1/2013 | 14,749(6) | 501,613 | |||||||||
Charles K. Stevens,III | 7/28/2015 | – | 249,458(2) | 374,187(3) | 31.32 | 7/28/2025 | |||||
2/11/2015 | 19,081(4) | 648,945 | 57,241(5) | 1,946,766 | |||||||
6/11/2014 | 11,190(4) | 380,572 | 50,353(5) | 1,712,506 | |||||||
2/13/2014 | 17,148(4) | 583,203 | |||||||||
3/1/2013 | 7,374(4) | 250,790 | |||||||||
Daniel Ammann | 7/28/2015 | – | 390,456(2) | 585,683(3) | 31.32 | 7/28/2025 | |||||
2/11/2015 | 29,865(4) | 1,015,709 | 89,594(5) | 3,047,092 | |||||||
6/11/2014 | 20,995(4) | 714,040 | 94,477(5) | 3,213,163 | |||||||
2/13/2014 | 37,511(6) | 1,275,749 | |||||||||
3/1/2013 | 15,210(6) | 517,292 | |||||||||
Mark L. Reuss | 7/28/2015 | – | 331,888(2) | 497,831(3) | 31.32 | 7/28/2025 | |||||
2/11/2015 | 25,385(4) | 863,344 | 76,155(5) | 2,590,032 | |||||||
6/11/2014 | 17,938(4) | 610,071 | 80,721(5) | 2,745,321 | |||||||
2/13/2014 | 57,160(7) | 1,944,012 | 33,224(6) | 1,129,948 | |||||||
3/1/2013 | 12,905(6) | 438,899 | |||||||||
Craig B. Glidden | 7/28/2015 | – | 167,029(2) | 250,542(3) | 31.32 | 7/28/2025 | |||||
4/1/2015 | 13,099(4) | 445,497 | 39,297(5) | 1,336,491 | |||||||
4/1/2015 | 69,407(8) | 2,360,532 |
Option Awards | Stock Awards(1) | |||||||||||||||||||||||||||||||||||||||
Name | Grant Date | Number of Securities Underlying Unexercised Options Exercisable (#) | Number of Securities Underlying Unexercised Options Unexercisable (#) | Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options (#) | Option Exercise Price ($) | Option Expiration Date | Number of Shares of Units or Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units, or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units, or Other Rights That Have Not Vested ($) | ||||||||||||||||||||||||||||||
Mary T. Barra | 6/7/2017 | — | 652,611 | (2) | 34.34 | 6/7/2027 | ||||||||||||||||||||||||||||||||||
2/14/2017 | 261,816 | (7.8) | 10,731,838 | (8) | ||||||||||||||||||||||||||||||||||||
2/10/2016 | 78,191 | (6) | 3,205,049 | 351,859 | (7,8) | 14,422,700 | (8) | |||||||||||||||||||||||||||||||||
7/28/2015 | 1,041,215 | (3) | 520,608 | (4) | 1,041,214 | (5) | 31.32 | 7/28/2025 | ||||||||||||||||||||||||||||||||
2/11/2015 | 504,380 | (6,7) | 20,674,536 | |||||||||||||||||||||||||||||||||||||
Charles K. Stevens, III | 6/7/2017 | — | 186,998 | (2) | 34.34 | 6/7/2027 | ||||||||||||||||||||||||||||||||||
2/14/2017 | 75,021 | (7,8) | 3,075,111 | (8) | ||||||||||||||||||||||||||||||||||||
2/10/2016 | 20,750 | (6) | 850,543 | 93,378 | (7,8) | 3,827,564 | (8) | |||||||||||||||||||||||||||||||||
7/28/2015 | — | 124,729 | (4) | 249,458 | (5) | 31.32 | 7/28/2025 | |||||||||||||||||||||||||||||||||
2/11/2015 | 120,842 | (6,7) | 4,953,314 | |||||||||||||||||||||||||||||||||||||
Daniel Ammann | 6/7/2017 | — | 247,867 | (2) | 34.34 | 6/7/2027 | ||||||||||||||||||||||||||||||||||
2/14/2017 | 99,440 | (7,8) | 4,076,046 | (8) | ||||||||||||||||||||||||||||||||||||
2/10/2016 | 28,269 | (6) | 1,158,746 | 127,211 | (7,8) | 5,214,379 | (8) | |||||||||||||||||||||||||||||||||
7/28/2015 | 390,456 | (3) | 195,228 | (4) | 390,455 | (5) | 31.32 | 7/25/2025 | ||||||||||||||||||||||||||||||||
2/11/2015 | 189,143 | (6,7) | 7,752,972 | |||||||||||||||||||||||||||||||||||||
Mark L. Reuss | 6/7/2017 | — | 203,314 | (2) | 34.34 | 6/7/2027 | ||||||||||||||||||||||||||||||||||
2/14/2017 | 81,566 | (7,8) | 3,343,390 | (8) | ||||||||||||||||||||||||||||||||||||
2/10/2016 | 23,457 | (6) | 961,502 | 105,558 | (7,8) | 4,326,822 | (8) | |||||||||||||||||||||||||||||||||
7/28/2015 | — | 165,944 | (4) | 331,887 | (5) | 31.32 | 7/28/2025 | |||||||||||||||||||||||||||||||||
2/11/2015 | 160,771 | (6,7) | 6,590,003 | |||||||||||||||||||||||||||||||||||||
Alan S. Batey | 6/7/2017 | — | 135,226 | (2) | 34.34 | 6/7/2027 | ||||||||||||||||||||||||||||||||||
2/14/2017 | 54,251 | (7,8) | 2,223,748 | (8) | ||||||||||||||||||||||||||||||||||||
2/10/2016 | 16,240 | (6) | 665,678 | 73,079 | (7,8) | 2,995,508 | (8) | |||||||||||||||||||||||||||||||||
7/28/2015 | — | 117,137 | (4) | 234,273 | (5) | 31.32 | 7/28/2025 | |||||||||||||||||||||||||||||||||
2/11/2015 | 113,487 | (6,7) | 4,651,832 | |||||||||||||||||||||||||||||||||||||
Karl-Thomas Neumann | 6/7/2017 | — | 119,227 | (2) | 34.34 | 6/7/2027 | ||||||||||||||||||||||||||||||||||
2/14/2017 | 47,832 | (7,8) | 1,960,634 | (8) | ||||||||||||||||||||||||||||||||||||
2/10/2016 | 14,285 | (6) | 585,542 | 64,282 | (7,8) | 2,634,919 | (8) | |||||||||||||||||||||||||||||||||
7/28/2015 | — | 117,137 | (4) | 234,273 | (5) | 31.32 | 7/28/2025 | |||||||||||||||||||||||||||||||||
2/11/2015 | 99,826 | (6,7) | 4,091,868 |
(1) | The awards are valued based on the closing price of common stock on the NYSE on December |
(2) | Options awards granted on June 7, 2017 and vest ratably each February 14 of 2018, 2019, and 2020. |
(3) | Option awards granted under the DSV Option Grant on July 28, |
Option awards granted under the DSV Option Grant on July 28, |
(5) | Option awards granted under the DSV Option Grant on July 28, 2015. This portion represents the unearned 40% of the award that features performance-based vesting and vests ratably each February 15 of |
EXECUTIVE COMPENSATION
(6) | RSU awards |
(7) | 2017 PSU awards |
2016–December 31, 2018. 2015 PSU awards | |
(8) | Assumes target-level payout of PSU awards. If maximum-level payout of PSU awards, the number of shares (and market value of such shares) with respect to unvested 2016–2018 PSUs and 2017–2020 PSUs, respectively, outstanding as of December 31, 2017 was for Ms. Barra: 703,718 shares ($28,845,401) and 523,632 shares ($21,463,676); for Mr. Stevens: 186,756 shares ($7,655,128) and 150,042 shares ($6,150,222); for Mr. Ammann: 254,422 shares ($10,428,758) and 198,880 shares ($8,152,091); for Mr. Reuss: 211,116 shares ($8,653,645) and 163,132 shares ($6,686,781); for Mr. Batey: 146,158 shares ($5,991,016) and 108,502 shares ($4,447,497); for Dr. Neumann: 128,564 shares ($5,269,838) and 95,664 shares ($3,921,267). |
u | |||
Option Awards(1) | Stock Awards(2) | ||||||||||||||||||||
Number of Shares | Value Realized on | Number of Shares | Value Realized on | ||||||||||||||||||
Acquired on | Exercise | Acquired on Vesting | Vesting | Option Awards(1) | Stock Awards(2) | ||||||||||||||||
Name | Exercise (#) | ($) | (#) | ($) | Number of Shares Acquired on Exercise (#)
| Value Realized on Exercise ($)
| Number of Shares Acquired on Vesting (#)
| Value Realized on Vesting ($)
| |||||||||||||
Mary T. Barra | – | – | 65,913 | 2,476,240 |
| —
|
|
| —
|
|
| 506,118
|
|
| 17,952,336
|
| |||||
Charles K. Stevens, III | – | – | 30,288 | 1,137,321 |
| 249,458
|
|
| 3,278,227
|
|
| 126,236
|
|
| 4,477,131
|
| |||||
Daniel Ammann | – | – | 54,262 | 2,037,643 |
| —
|
|
| —
|
|
| 231,322
|
|
| 8,206,125
|
| |||||
Mark L. Reuss | – | – | 45,885 | 1,722,967 |
| 331,888
|
|
| 1,222,211
|
|
| 254,800
|
|
| 9,032,512
|
| |||||
Craig B. Glidden | – | – | – | – | |||||||||||||||||
Alan S. Batey
|
| 234,274
|
|
| 1,573,702
|
|
| 135,982
|
|
| 4,824,134
|
| |||||||||
Karl-Thomas Neumann | 234,274 | 808,339 | 158,341 | 5,665,176 |
(1) |
|
(2) | We computed the aggregate dollar value realized on vesting by multiplying the number of shares of stock vested by the closing price of common stock on the |
GM Salaried Retirement Plan
Eligibility and Vesting:The GM Salaried Retirement Plan (SRP)(“SRP”) is a funded,tax-qualified retirement program that covers eligible employees hired prior to January 1, 2007. Employees who commenced service on or after January 1, 2007, are eligible to participate only in defined contribution plans. Employees are vested in the SRP after five years of qualifying service. The plan permitted employee contributions, which vested immediately, until December 31, 2006. All Defined Benefit accruals were frozen on September 30, 2012, with service continuing toward eligibility to retire.
Benefit Formula:
Service prior to January 1, 20012001:– The plan provided benefits on both a contributory and noncontributory formula. The contributory formula factors the contributions of the executive and earnings for each fiscal year. The formulas were frozen effective December 31, 2006, and effective January 1, 2007, employees continued to participate in the SRP under a new formula that provided a pension accrual equal to 1.25 percent1.25% of the employee’s eligible earnings up to theIRS-prescribed limits fortax-qualified plans. The 1.25 percent1.25% accruals were frozen September 30, 2012.
Service from January 1, 2001 to December 31, 20062006:– The plan provided benefits under a cash balance formula with pay credits based on age through December 31, 2006, when the formula was frozen, with balances continuing to earn interest credits thereafter.
Time and Form of Payment:The accumulated benefit an employee earns over his or her career with the Company is payable starting after retirement. Normal retirement age is defined as age 65. Employees who commenced service prior to 1988 may elect early retirement after 30 years of credited service or 85 points, based on combined age and service, or age 60 and 10 or more years of service, with certainage-reduction factors applied. The plan also provides Social Security supplements for those hired prior to 1988. For employees hired on and after January 1, 1988, and prior to December 31, 2000, Social Security supplements are not payable, andage-reduction factors are greater for retirements prior to age 60. The plan provides both a spousal joint and survivor annuity and contingent annuitant optional form of payment. The employee may elect either a monthly annuity for life or a 100 percent100% lump sum of all benefits payable.
Tax Code Limitations on Benefits:Section 415 of the IRC limits the benefits payable under the GM SRP. For 2015,2017, the maximum single life annuity a named executiveNEO could have received under these limits was $210,000$215,000 per year. This ceiling is actuarially adjusted in accordance with IRS rules to reflect employee contributions, actual forms of distribution, and actual retirement dates.
61 |
EXECUTIVE COMPENSATION
GM Executive Retirement Plan
Eligibility and Vesting:The GM Executive Retirement Plan (DB ERP)(“DB ERP”) is an unfunded andnon-tax-qualified retirement program that covers eligible executives, including named executives, to provide retirement benefits above amounts available under our other pension programs.
Benefit Formula:
Service Prior to January 1, 20072007:– The supplemental pension will equal the greater of (a) 2 percent2% of the average monthly base salary multiplied by all years of contributory service less the sum of all benefits payable under the GM Salaried
Retirement plus the maximum Social Security Benefit as of January 2007 multiplied by all years of noncontributory service or (b) 1.5 percent1.5% of the average monthly base salary plus annual incentive plan compensation multiplied by all years of contributory service, up to a maximum of 35 years less the sum of all benefits payable under the GM SRP plus 100 percent100% of the maximum Social Security benefit as of January 2007. In both cases, the base salary and annual incentive plan payments are determined using the highest 60 months out of the last 120 months prior to retirement.
Service from January 1, 2007 to December 31, 20072007:– The supplemental pension will equal 1.25 percent1.25% multiplied by their annual base salary and is applicable to amounts in excess of theIRS-prescribed limit applicable totax-qualified plans.
Service from January 1, 2008 to September 30, 20122012:– The supplemental pension will equal 1.25 percent1.25% multiplied by their annual base salary plus short-term incentive payments and is applicable to amounts in excess of theIRS-prescribed limit applicable totax-qualified plans.
Time and form of payment:Normal retirement age under the plan is age 65; however, employees who commenced service prior to January 1, 2007, including NEOs, may retire at age 60 with 10 or more years of service without any reduction in benefits. Employees may also retire at age 55 with 10 or more years of service with benefits reduced using the same factors as are utilized for early retirement under the GM SRP. The GM DB ERP is payable as a five-year certain annuity, with payments starting upon the retirement of the executive and continuing for 60 months.
VML Pension Plan
Eligibility and Vesting: The Vauxhall Motors (“VML”) Pension Plan is a funded defined benefit plan open to all GM United Kingdom employees prior to October 2012, when it closed to new entrants.
Benefit Formula:
Service Prior to May 31, 2009: The VML Pension Plan gave an annual pension equal to 1/55th times pensionable service times Final Pensionable Pay. Pensionable Pay is defined as basic pay less the lower earnings limit.
Service from June 1, 2009: An annual pension equal to 1/60th times pensionable service times Final Pensionable Pay. Increases in pensionable pay is limited to the rate of RPI inflation annually other than for one off increases due to promotions.
Time and form of payment: Normal retirement age under the plan is age 65. Deferred members can take their pension from age 55 subject to a reduction, using the plans early retirement factors.
Adam Opel AG Pension Plan
Eligibility and Vesting: The Adam Opel AG (“Opel”) Pension Plan is a cash balance plan. Participants hired after 2006 accrue “pension elements” each year. The pension element equals a “pay credit” multiplied by an “age factor.” Full vesting is provided after five years of service and 25 years of age.
Benefit Formula:
Service from 2006: The pay credit is 1.75% times the annual income for the year, plus 10.5% times the portion of the annual income in excess of the social security threshold for the year. The age factor is designed to accumulate the pay credit with interest to age 60 and ranges from 4% for the youngest employees to 1% for the oldest. Between 60 and retirement, in addition to the pension elements continuing to accrue, the accumulated pension elements are increased at the minimum guaranteed rate of interest for German life insurance contracts.
Time and form of payment: Normal retirement age under the plan is age 63. Participants must wait until normal retirement benefit age before commencing benefits. The normal form of payment is 12 annual installments. Payments in six annual installments, a lump sum, or a lifelong annuity are available, but subject to Company consent.
Number of Years | ||||
of Eligible Credited | Present Value | |||
Service as of | of Accumulated | Payments During | ||
December 31, | Benefits(2) | Last Fiscal Year | ||
Name | Plan Name | 2015(1) | ($) | ($) |
Mary T. Barra | SRP | 33.3 | 931,535 | – |
DB ERP | 33.3 | 893,140 | – | |
Charles K. Stevens, III | SRP | 36.5 | 1,019,533 | – |
DB ERP | 36.5 | 406,945 | – | |
Daniel Ammann(3) | – | – | – | |
Mark L. Reuss | SRP | 28.8 | 743,701 | – |
DB ERP | 28.8 | 554,546 | – | |
Craig B. Glidden(3) | – | – | – |
62 |
EXECUTIVE COMPENSATION
Name | Plan Name | Number of Years of Eligible Credited Service as of December 31, 2017(1) | Present Value of Accumulated Benefits(2) ($) | Payments During Last Fiscal Year ($) | ||||||||||
Mary T. Barra |
SRP |
|
35.3 |
|
|
1,095,092 |
|
|
— |
| ||||
DB ERP
|
| 35.3
|
|
| 964,422
|
|
| —
|
| |||||
Charles K. Stevens, III |
SRP |
|
38.5 |
|
|
1,179,679 |
|
|
— |
| ||||
DB ERP
|
| 38.5
|
|
| 436,059
|
|
| —
|
| |||||
Daniel Ammann(3) |
|
—
|
|
|
—
|
|
|
—
|
| |||||
Mark L. Reuss |
SRP |
|
30.8 |
|
|
884,761 |
|
|
— |
| ||||
DB ERP
|
| 30.8
|
|
| 602,652
|
|
| —
|
| |||||
Alan S. Batey(4) |
SRP |
|
38.3 |
|
|
52,949 |
|
|
— |
| ||||
VML Pension Plan
|
| 31.8
|
|
| 2,767,045
|
|
| —
|
| |||||
Karl-Thomas Neumann
|
Opel
|
|
4.8
|
|
|
490,007
|
|
|
—
|
|
(1) | Eligible service recognizes credited service under the frozen qualified SRP in addition to future service to determine retirement eligibility. |
(2) | The present value of the SRP benefit amount shown takes into consideration the ability to elect a joint and survivor annuity form of |
(3) | Mr. Ammann |
Mr. Batey is a participant in the VML Pension Plan from his service in the United Kingdom. |
u |
We maintain certain deferred compensation programs and arrangements for executives, including the NEOs.
DC ERP– Allows for the equalization of benefits for highly compensated salaried employees under the RSP when such employees’ contribution and benefit levels exceed the maximum limitations on contributions and benefits imposed by Section 2004 of ERISA, as amended, and Section 401(a)(17) and 415 of the IRC, as amended. The DC ERP is maintained as an unfunded plan, and we bear all expenses for administration of the plan and payment of amounts to participants.
Aggregate account balances disclosed below include both vested and unvested contributions by GM. Contributions made prior to 2007 were vested immediately. Contributions made between January 1, 2007, and September 30, 2012, vest when the participant attains age 55 with 10 years of service. Contributions made on October 1, 2012, and later vest when the participant attains three years of service, regardless of age.
Salary Stock Units (SSUs)– NEOs received a portion of their total annual compensation in the form of SSUs, which were granted each quarter while the Company was under TARP. SSUs are nonforfeitable and become deliverable quarterly in three equal installments at each of the first, second, and third anniversaries of the grant date. No SSUs have been granted since the Company exited TARP in 2013.
The table below reflects December 31, 2015,2017, balances for the various nonqualified deferred compensation plans, including vested but unpaid SSUs, based on the closing price of common stock ($34.01),plan and any contributions, earnings, andor withdrawals during the year.
Registrant | Aggregate | Aggregate | ||||||||||||||||||||||||||
Executive | Contributions | Earnings | Withdrawals | Aggregate | ||||||||||||||||||||||||
Contributions | in the Last | and | Balance at 2015 | |||||||||||||||||||||||||
in the Last | Fiscal Year(1) | Fiscal Year(2) | Distributions(3) | Fiscal Year End | ||||||||||||||||||||||||
Name | Plan | Fiscal Year | ($) | ($) | Plan | Executive Contributions in the Last Fiscal Year | Registrant Contributions in the Last Fiscal Year(1) ($) | Aggregate Earnings in the Last Fiscal Year(2) ($) | Aggregate Withdrawals and Distributions ($) | Aggregate Balance at 2017 Fiscal Year End(3) ($) | ||||||||||||||||||
Mary T. Barra | SSU | – | (96,225) | (2,146,575) | 946,158 | DC ERP | — | 602,664 | 222,246 | — | 1,743,016 | |||||||||||||||||
DC ERP | – | 285,216 | (8,050) | – | 473,042 | |||||||||||||||||||||||
Charles K. Stevens, III | SSU | – | (1,732) | (41,315) | 15,917 | DC ERP | — | 261,261 | 95,126 | — | 782,634 | |||||||||||||||||
DC ERP | – | 127,767 | (6,180) | – | 211,923 | |||||||||||||||||||||||
Daniel Ammann | SSU | – | (97,423) | (2,194,762) | 943,029 | DC ERP | — | 238,774 | 42,341 | — | 640,999 | |||||||||||||||||
DC ERP | – | 114,400 | 4,516 | – | 183,565 | |||||||||||||||||||||||
Mark L. Reuss | SSU | – | (81,647) | (1,842,417) | 803,350 | DC ERP | — | 271,200 | 104,822 | — | 795,468 | |||||||||||||||||
DC ERP | – | 133,945 | (6,075) | – | 198,797 | |||||||||||||||||||||||
Craig B. Glidden | DC ERP | – | 25,467 | (210) | – | 25,257 | ||||||||||||||||||||||
Alan S. Batey | DC ERP | — | 224,626 | 83,770 | — | 664,358 | ||||||||||||||||||||||
Karl-Thomas Neumann | DC ERP | — | — | — | — | — |
(1) |
|
(2) | Earnings that may be included in the Aggregate Earnings in the Last Fiscal Year column are not reported in the Change in Pension Value andNon-qualified Deferred Compensation totals in the Summary Compensation Table, because we do not pay above-market earnings on deferred compensation. |
The following amounts have been included in the Summary Compensation Table in prior years: $797,224 (Ms. Barra), $386,918 (Mr. Stevens), $337,559 (Mr. Ammann), $382,466 (Mr. Reuss), and $150,466 (Mr. Batey). |
63 |
EXECUTIVE COMPENSATION
u |
The Company does not maintain individual employment agreements with any NEO that providesprovide guaranteed payments in the event of a termination of employment or change in control. In the event that an NEO’s position with the Company is eliminated, including the elimination of the NEO’s position as a result of a change in control, the NEO would be eligible for severance pay under the GM Executive Severance Program.
The table below shows the potential payments to each NEO assuming a termination of employment on December 31, 2015,2017, due to each of the following: voluntary separation or termination for cause; qualifying termination under the Executive Severance Program (as amended on February 1, 2016);Program; full career status retirement; disability; death; and change in control with termination of employment. Each of the separation events is described in more detail below. These provisions are generally applicable to participants in each of the applicable plans, and they are not reserved only for NEOs. The payments below are in addition to the present value of the accumulated benefits from each NEOs qualified and nonqualified pension plans shown in the Pension Benefits table on page 59,63, and the aggregate balance due to each NEO that is shown in the Nonqualified Deferred Compensation table above.
For purposes of the following table, the Company describes these terminations and potential payments:
Voluntary Separation or Termination for Cause– A voluntary separation occurs when an executive voluntarily terminates employment with the Company. A termination for cause occurs when an executive is dismissed from employment by the Company for cause, which is considered to include, but is not limited to, the executive’s gross negligence, willful misconduct, or violation of state or federal securities laws. Under each of these scenarios, executives generally forfeit all outstanding equity awards and are not eligible for any award or payment under the STIP. Full career status retirements receive different treatment, as discussed below.
Executive Severance Program– A separation occurs when an executive’s position is eliminated or the Company and an executive agree to mutually end the employment relationship. An executive will be eligible to receive severance pay from the Company calculated based on their position and reflected as a multiple of base salary, COBRA, as well as a STIP and COBRA.award at target. An executive will receive cash payments of the value of the equity awards that are scheduled to vest within the next year after separation at the time of vesting if the executive enters into a mutual separation agreement. All unvested stock optionsStock Options are usually forfeited. An executive is also eligible for outplacement assistance based on their position.
Full Career Status Retirement– A full career status retirement occurs when an executive reaches the age of 55 with 10 or more years of continuous service or age 62 or older and the executive voluntarily separates from the Company. If an executive enters into a separation or severance agreement, they cannot also elect full career status retirement.
In the event of full career status retirement, the executive is generally eligible for a prorated STIP award based on months of active service in the performance year as of their termination date and once final performance has been determined. RSUs granted within one year prior to the date of retirement are prorated based on months of active service prior to the date of retirement. RSUs granted more than one year prior to the date of retirement continue to vest in accordance with their vesting schedule. PSUs granted within one year prior to the date of retirement are prorated based on months of active service prior to the date of retirement and will be adjusted for final corporate performance against the performance measures contained in the awards; such awards will be payable following approval of such performance. PSUs granted more than one year prior to the date of retirement will remain outstanding until the end of the performance period, at which time they will be adjusted for final corporate performance and be settled following approval of such performance. Stock options granted within one year prior to the date of retirement are prorated based on months of active service prior to the date of retirement. Stock options granted more than one year prior to the date of retirement will continue to vest in accordance with their vesting schedule. As of December 31, 2015,2017, only Ms. Barra and Mr. Stevens waswere eligible for full career status retirement.
Disability – Disability occurs when an executive terminates employment by reason of their inability to engage in any gainful activity due to a medically determinable physical or mental impairment that can be expected to result in death or can be expected to last for a continuous period of not less than 12 months. Executives are eligible for a full-year STIP award related to the year in which termination occurs once final performance has been determined. Unvested RSUs continue to vest according to their vesting schedule. Unvested PSUs vest immediately upon such termination and will remain outstanding until the end of the performance period, at which time they will be adjusted for final corporate performance and be settled following approval of such performance. Stock options will continue to vest in accordance with their vesting schedule.
Death – Following the death of an executive, the beneficiary of the executive will be eligible to receive the target STIP award subject to adjustment for final corporate and individual performance following determination of the final award. RSUs immediately vest in full and are settled within 90 days of death. PSUs vest immediately upon death and will remain outstanding until the end of the performance period, at which time they will be adjusted for final corporate performance and be settled following approval of such performance. Stock options vest immediately upon death.
Change in Control (Double Trigger) – In the event of a termination of employment resulting from a change in control, an executive will be eligible for severance under the GM Executive Severance Program that provides a severance payment based on position and multiple of base salary and
64 |
EXECUTIVE COMPENSATION
COBRA. Executives also receive a STIP award at target and the STIP award for the prior year, if such award has been determined, but not paid. If the STIP award for the prior year has not been determined, the award shall be determined at target and paid. All RSU awards will generally vest and become payable immediately prior to the change in control. |
For PSUs, the performance period will end immediately prior to the change in control, and awards will be determined based on actual performance and converted to a time-based award. Stock options immediately vest and are exercisable upon termination as a result of a change in control. | ||
Voluntary | ||||||||||||||
Separation or | Executive | Change in | ||||||||||||
Compensation | Termination | Severance | Control with | |||||||||||
Name | Element(1)(2)(3) | for Cause | Program | Retirement(4) | Disability | Death | Termination | |||||||
Mary T. Barra | Cash | – | 3,553,994 | – | – | – | 3,538,994 | |||||||
STIP | – | 3,062,500 | – | 3,062,500 | 3,062,500 | 3,062,500 | ||||||||
LTIP | – | 1,687,542 | – | 28,244,848 | 27,756,293 | 26,467,486 | ||||||||
TOTAL | – | 8,304,036 | – | 31,307,348 | 30,818,793 | 33,068,980 | ||||||||
Charles K. Stevens, III | Cash | – | 1,544,246 | – | – | – | 1,529,246 | |||||||
STIP | – | 1,250,000 | 1,250,000 | 1,250,000 | 1,250,000 | 1,250,000 | ||||||||
LTIP | – | 1,046,216 | 3,903,216 | 7,200,387 | 6,975,853 | 7,200,387 | ||||||||
TOTAL | – | 3,840,462 | 5,153,216 | 8,450,387 | 8,225,853 | 9,979,633 | ||||||||
Daniel Ammann | Cash | – | 1,844,246 | – | – | – | 1,829,246 | |||||||
STIP | – | 1,500,000 | – | 1,500,000 | 1,500,000 | 1,500,000 | ||||||||
LTIP | – | 695,573 | – | 12,408,859 | 11,919,433 | 10,615,818 | ||||||||
TOTAL | – | 4,039,819 | – | 13,908,859 | 13,419,433 | 13,945,064 | ||||||||
Mark L. Reuss | Cash | – | 1,694,246 | – | – | – | 1,679,246 | |||||||
STIP | – | 1,375,000 | – | 1,375,000 | 1,375,000 | 1,375,000 | ||||||||
LTIP | – | 592,829 | – | 12,553,571 | 12,121,151 | 10,984,724 | ||||||||
TOTAL | – | 3,662,075 | – | 13,928,571 | 13,496,151 | 14,038,970 | ||||||||
Craig B. Glidden | Cash | – | 1,094,246 | – | – | – | 1,079,246 | |||||||
STIP | – | 875,000 | – | 875,000 | 875,000 | 875,000 | ||||||||
LTIP | – | 148,488 | – | 5,265,786 | 5,265,786 | 5,265,786 | ||||||||
TOTAL | – | 2,117,734 | – | 6,140,786 | 6,140,786 | 7,220,032 | ||||||||
Amounts shown in the following table are calculated by assuming that the relevant employment termination event occurred on December 31, 2017.
Name | Compensation Element(1)(2)(3) | Voluntary Separation or Termination for Cause | Executive Severance Program | Retirement(4) | Disability | Death | Change in Control with Termination | |||||||||||||||||||
Mary T. Barra | Cash
|
| —
|
|
| 4,261,875
|
|
| —
|
|
| —
|
|
| —
|
|
| 4,246,875
|
| |||||||
STIP
|
| —
|
|
| 4,200,000
|
|
| 4,326,000
|
|
| 4,326,000
|
|
| 4,326,000
|
|
| 4,200,000
|
| ||||||||
LTIP
|
| —
|
|
| 22,277,081
|
|
| 57,633,624
|
|
| 68,476,813
|
|
| 68,476,813
|
|
| 68,476,813
|
| ||||||||
TOTAL
|
| —
|
|
| 30,738,956
|
|
| 61,959,624
|
|
| 72,802,813
|
|
| 72,802,813
|
|
| 76,923,688
|
| ||||||||
Charles K. Stevens, III | Cash
|
| —
|
|
| 1,700,156
|
|
| —
|
|
| —
|
|
| —
|
|
| 1,685,156
|
| |||||||
STIP
|
| —
|
|
| 1,375,000
|
|
| 1,416,250
|
|
| 1,416,250
|
|
| 1,416,250
|
|
| 1,375,000
|
| ||||||||
LTIP
|
| —
|
|
| 5,378,585
|
|
| 14,461,449
|
|
| 17,568,456
|
|
| 17,568,456
|
|
| 17,568,456
|
| ||||||||
TOTAL
|
| —
|
|
| 8,453,741
|
|
| 15,877,699
|
|
| 18,984,706
|
|
| 18,984,706
|
|
| 20,628,612
|
| ||||||||
Daniel Ammann | Cash
|
| —
|
|
| 2,206,187
|
|
| —
|
|
| —
|
|
| —
|
|
| 2,191,187
|
| |||||||
STIP
|
| —
|
|
| 1,812,500
|
|
| —
|
|
| 1,866,875
|
|
| 1,866,875
|
|
| 1,812,500
|
| ||||||||
LTIP
|
| —
|
|
| 8,332,365
|
|
| —
|
|
| 25,514,022
|
|
| 25,514,022
|
|
| 25,514,022
|
| ||||||||
TOTAL
|
| —
|
|
| 12,351,052
|
|
| —
|
|
| 27,380,897
|
|
| 27,380,897
|
|
| 29,517,709
|
| ||||||||
Mark L. Reuss | Cash
|
| —
|
|
| 1,850,156
|
|
| —
|
|
| —
|
|
| —
|
|
| 1,835,156
|
| |||||||
STIP
|
| —
|
|
| 1,500,000
|
|
| —
|
|
| 1,545,000
|
|
| 1,545,000
|
|
| 1,500,000
|
| ||||||||
LTIP
|
| —
|
|
| 7,070,775
|
|
| —
|
|
| 21,387,781
|
|
| 21,387,781
|
|
| 21,387,781
|
| ||||||||
TOTAL
|
| —
|
|
| 10,420,931
|
|
| —
|
|
| 22,932,781
|
|
| 22,932,781
|
|
| 24,722,937
|
| ||||||||
Alan S. Batey | Cash
|
| —
|
|
| 1,587,656
|
|
| —
|
|
| —
|
|
| —
|
|
| 1,572,656
|
| |||||||
STIP
|
| —
|
|
| 1,281,250
|
|
| —
|
|
| 1,319,688
|
|
| 1,319,688
|
|
| 1,281,250
|
| ||||||||
LTIP
|
| —
|
|
| 4,984,671
|
|
| —
|
|
| 14,834,154
|
|
| 14,834,154
|
|
| 14,834,154
|
| ||||||||
TOTAL
|
| —
|
|
| 7,853,577
|
|
| —
|
|
| 16,153,842
|
|
| 16,153,842
|
|
| 17,688,060
|
| ||||||||
Karl-Thomas Neumann(5) | Cash
|
| —
|
|
| —
|
|
| —
|
|
| —
|
|
| —
|
|
| —
|
| |||||||
STIP
|
| —
|
|
| —
|
|
| —
|
|
| —
|
|
| —
|
|
| —
|
| ||||||||
LTIP
|
| —
|
|
| —
|
|
| —
|
|
| —
|
|
| —
|
|
| —
|
| ||||||||
TOTAL
|
| —
|
|
| —
|
|
| —
|
|
| —
|
|
| —
|
|
| —
|
|
(1) | Cash amounts shown for Executive Severance Program and Change in Control with Termination are based on the Executive Severance |
(2) | STIP values shown for Full Career Status Retirement, Disability, and Death are based on the actual full-year performance at the overall corporate achievement. STIP amounts shown for Executive Severance Program and Change in Control with Termination reflect target-level performance. Executives forfeit STIP awards for Voluntary Separation or Termination for Cause. |
(3) | LTIP amounts reflect the value of unvested RSU awards, PSU awards, and |
(4) | Only Ms. Barra and Mr. Stevens |
(5) | Dr. Neumann left the Company on March 1, 2018. Dr. Neumann’s termination constituted a Voluntary Separation, and no payments were made, as reflected in the table. |
65 |
EXECUTIVE COMPENSATION
u | CEO Pay Ratio |
Our CEO, who leads our global workforce of 180,000 (103,000 are located in the United States and 77,000 arenon-U.S. employees) had $21,958,048 in Annual Total Compensation in 2017 as reported in the Summary Compensation Table.
To identify our median employee, we:
1. | Excluded all employees (7,519) in the following 26 countries under the SEC’s 5% de minimis exemption: Argentina (199), Belarus (2), Switzerland (26), Chile (215), China (802), Colombia (1,204), Germany (16), Ecuador (853), Egypt (837), Great Britain (57), Indonesia (52), Ireland (195), Israel (187), Italy (705), Japan (42), New Zealand (39), Peru (45), Philippines (277), Russia (117), Singapore (89), Taiwan (9), Uruguay (12), Uzbekistan (8), Venezuela (34), Vietnam (375), and South Africa (1,122) |
Calculated year-to-date payroll as of November 1, 2017 on all employees, excluding the CEO |
3. | Identified the middle 51 employees using year-to-date payroll as a consistently applied compensation measure |
4. | Calculated annual total compensation for the 51 middle employees based on the same SEC requirements that apply for determining total compensation of each NEO in the Summary Compensation Table |
5. | Re-ranked all middle 51 employees and selected the median employee |
Based on our calculation we can reasonably estimate that our median employee’s annual total compensation was $74,487 per year. The ratio of our CEO’s compensation to that of our median employee is estimated to be 295:1.
The SEC’s rules for identifying the median employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies to calculate the median employee, exclude up to 5% of the workforce, and make reasonable estimates and assumptions that may impact their employee populations. As a result, the pay ratio reported by other companies may not be comparable with the pay ratio reported above. Other companies have different employee populations and compensation practices and the ability to utilize different methodologies, exclusions, estimates, and assumptions in calculating their own pay ratios.
66 | |||
Equity Compensation Plan Information
The following table provides information as of December 31, 2015,2017, about the Company’s common stock that may be issued upon the exercise of options, warrants, and rights under all of the Company’s existing equity compensation plans.
Number of Securities | ||||||||||||||||||
Remaining Available for | ||||||||||||||||||
Number of Securities to | Future Issuance Under | |||||||||||||||||
be Issued Upon Exercise | Weighted-Average Exercise | Equity Compensation Plan | ||||||||||||||||
of Outstanding Options, | Price of Outstanding Options, | (excluding securities | ||||||||||||||||
Warrants, and Rights | Warrants, and Rights | reflected in column (A)) | ||||||||||||||||
Plan Category | (A) | (B) | (C) | 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 Plan (excluding securities reflected in column (A)) (C) | ||||||||||||
Equity compensation plans approved by security holders | 33,687,420(1) | 31.32(2) | 21,097,467 |
| 43,700,545
| (1)
|
| $32.04
|
|
| 43,807,105
|
| ||||||
Equity compensation plans not approved by security holders | – | – | – | |||||||||||||||
Equity compensation plans not approved by security holders(2)
|
| 5,852,700
| (3)
|
| —
|
|
| 15,187
|
| |||||||||
Total | 33,687,420 | 31.32 | 21,097,467 |
| 49,553,245
| (4)
|
| $32.04
|
|
| 43,822,292
|
| ||||||
(1) | The number includes the following: |
a. |
b. | ||
3,907,087 shares represent RSUs. |
(2) | 2016 Equity Incentive Plan, refer to Note 21 in our Annual Report on Form |
(3) | Represents RSUs, restricted stock, and PSUs. PSUs may be issued upon achievement of performance conditions. |
(4) | Excludes 3,301,608 stock based units that are required to be settled in cash pursuant to award agreements. |
The following table provides information on share usage for awards granted and performance awards vested/earned during fiscal year 2017 under the Company’s equity compensation plans.
Granted(1) | Performance Awards Vested/Earned | |||||||
RSUs
|
| 1,000,000
|
|
| —
|
| ||
RSAs
|
|
—
|
|
| —
|
| ||
PSUs
|
| 5,200,000
|
|
| 6,500,000
|
| ||
Time-Based Stock Options
|
|
6,500,000
|
|
|
—
|
| ||
Performance-Based Stock Options
|
| —
|
|
| —
|
|
(1) | Excludes 4,000,000 stock based units that are required to be settled in cash pursuant to award agreements. |
67 |
ITEM NO. 2 – APPROVAL OF, ON AN ADVISORY BASIS, NAMED EXECUTIVE OFFICER COMPENSATION
Executive compensation is an important matter for our shareholders. The Dodd-Frank Wall Street Reform and Consumer Protection Act requires that we provide you with the opportunity to vote to approve, on a nonbinding advisory basis, the compensation of our named executive officers, as disclosed in this Proxy Statement in accordance with the compensation disclosure rules of the SEC (sometimes referred to as “Say-on-Pay”“Say-on-Pay”).
An advisory vote on how frequently we would hold Say-on-Pay votes was held at the 2014 Annual Meeting, and over 82 percent of shares voted were voted in favor of an annual vote. In 2015, over 97 percent of shares voted were voted “FOR” our Say on Pay proposal.
The Compensation Committee has approved the compensation arrangements for our named executive officers described in our CD&ACompensation Discussion and Analysis beginning on page 35 and accompanying compensation tables beginning on page 35 of57 in this Proxy Statement. We urge you to read the CD&ACompensation Discussion and Analysis for a more complete understanding of our executive compensation plans, including our compensation philosophy and objectives and the 20152017 compensation of named executive officers.
We are asking shareholders to vote in favor of the following resolution:
RESOLVED, that the compensation paid to the Company’s named executive officers, as disclosed pursuant to Item 402 of RegulationS-K, including the Compensation Discussion and Analysis, compensation tables, and the related narrative discussion, is hereby APPROVED.
As an advisory vote, this proposal is nonbinding. Although the vote is nonbinding, the Board of Directors and the Compensation Committee value the opinions of our shareholders and will consider the outcome of the vote when making future compensation decisions for named executive officers.
The nextSay-on-Pay vote will occur at our 20172019 Annual Meeting and the nextSay-on-Frequency vote will occur at our 2020 Annual Meeting.
Vote Required
The affirmative vote of a majority of the shares of our Common Stockcommon stock present or represented by proxy and entitled to vote at the Annual Meeting is required for approval of this proposal. If you own shares through a broker, bank, or other nominee, you must instruct your broker, bank, or other nominee on how to vote your shares to ensure that your shares will be represented and voted on this proposal.
The Board of Directors recommends a voteFORFORthe advisory proposal to approve named executive officer compensation.
68 | |||
ITEM NO. 3 – RATIFICATION OF THE SELECTION OF ERNST & YOUNG LLP AS THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2018
The Process and Scope of the RFP
The Committee conducted a competitive process to select the Company’s independent registered public accounting firm for the Company’s fiscal year ending December 31, 2018. The Committee invited several independent registered public accounting firms to participate in this process. The Committee evaluated the proposals of the independent registered public accounting firms and considered several factors, including audit quality; the benefits of tenure versus fresh perspective; cultural fit and business acumen; innovation and technology; potential transition risks; auditor independence; and the appropriateness of fees relative to both efficiency and audit quality.
The Outcome of the RFP
Following review of the RFP proposals, the Audit Committee selected EY as the Company’s independent registered public accounting firm for the Company’s fiscal year ending December 31, 2018. The Audit Committee believes that the engagement of EY as the Company’s independent registered public accounting firm for 2018 is in the best interest of the Company and its shareholders. The Board of Directors recommends that shareholders ratify the Audit Committee’s selection of EY as the Company’s independent registered public accounting firm for 2018. If the shareholders do not ratify the selection of EY as the independent registered public accounting firm for the Company for 2018, the Committee will reconsider whether to engage EY, but may ultimately determine to engage EY or another audit firm without resubmitting the matter to shareholders. Deloitte & Touche LLP (“Deloitte”) and its predecessor companies had been GM’s or General Motors Corporation’s auditors since 1918.
Even if the shareholders ratify the selection of EY, the Committee may, in its sole discretion, terminate the engagement of EY and direct the appointment of another independent registered public accounting firm at any time during the year, although it has no current intention to do so.
The Board of Directors recommends a voteFOR the proposal to ratify the selection of Ernst & Young LLP as the independent registered public accounting firm for GM and its subsidiaries for 2018.
WHAT IS THE AUDIT COMMITTEE’S FUNCTION RELATIVE TO THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM? The Audit Committee is directly responsible for the appointment, compensation, retention, and oversight of the independent registered public accounting firm retained to audit the Company’s financial statements. To oversee continuing audit independence and objectivity,In 2017, the Audit Committee periodically considers whether there should beconducted a rotation of the independent registered public accounting firm. In accordance with the mandated rotation of the accounting firm’s lead engagement partner,comprehensive request for proposal (“RFP”) process, which resulted in the Audit Committee is also involved in the selection of the accounting firm’s lead engagement partner working with Deloitte & Touche LLP (“Deloitte”), with input from management.
The Audit Committee annually evaluates the performance of the independent auditor and reviewed the following performance factors in deciding whether to retain the independent auditor:
Following this evaluation, the Audit Committee has selected Deloitte as GM’sselecting a new independent registered public accounting firm for 2016. The Audit Committee believes that the retention of Deloitte to serve as the Company’s independent registered public accounting firm for 2016 is2018 – Ernst & Young LLP (“EY”). For additional information about our change in the best interest of the Company and its shareholders. Deloitte and its predecessor companies have been GM’s or General Motors Corporation’s auditors since 1918. The Audit Committee considers Deloitte well qualified, with offices or affiliates in or near most locations in the U.S. and other countries where General Motors operates.
The Board of Directors has concurred in an advisory capacity with the Audit Committee’s selection of Deloitte, and the appointment of Deloitte will be submitted to the shareholders at the Annual Meeting for ratification. If the shareholders do not ratify the selection of Deloitte as the independent registered public accounting firm for the Company for 2016, the Audit Committee will reconsider whether to engage Deloitte, but may ultimately determine to engage that firm or another audit firm without resubmitting the matter to shareholders. Among the factors the Audit Committee may consider in making this determination are the difficulty and the expense of changing independent registered public accounting firms, in the middle of a fiscal year. Even if the shareholders ratify the selection of Deloitte, the Audit Committee may in its sole discretion terminate the engagement of Deloitte and direct the appointment of another independent registered public accounting firm at any time during the year, although it has no current intention to do so.
Representatives of Deloitte will attend the Annual Meeting and will have the opportunity to make any statement they wish. They will also be available to respond to appropriate questions.
The Board of Directors recommends a voteFORthe proposal to ratify the selection of Deloitte & Touche LLP as the independent registered public accounting firm for GM and its subsidiaries for 2016.
The following Audit Committee Report shall not be deemed incorporated by reference by any general statement incorporating by reference in this Proxy Statement or any portion hereof into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, and shall not otherwise be deemed filed thereunder.see Appendix B.
69 |
ITEM NO. 3 – RATIFICATION OF THE SELECTION OF ERNST & YOUNG LLP AS
THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2018
The Audit Committee (the “Committee”) of the General Motors Board of Directors is a standing committee composed of four directors who meetdirectors: Thomas M. Schoewe (Chair), Linda R. Gooden, Jane L. Mendillo, and Michael G. Mullen.
Purpose
The Committee’s core purposes are to assist the independence, financial expertise, and other qualification requirements of the NYSE and applicable securities laws. ItBoard by providing oversight of:
u | The quality and integrity of GM’s financial statements; |
u | GM’s compliance with legal and regulatory requirements; and |
u | The qualifications and independence of GM’s external auditors and the performance of GM’s internal audit staff and external auditors. |
The Committee operates under a written charter adopted by the Committee and approved by the Board of Directors, whichDirectors. The Committee’s charter is posted on our website atwww.gm.com/investorgm.com/investors/corporate-governance., under “Corporate Governance.” The members of the Committee are Thomas M. Schoewe (Chair), Linda R. Gooden, Kathryn V. Marinello,Committee’s charter is reviewed at least annually and Michael G. Mullen. The Board has determined that Mr. Schoewe, Ms. Gooden,updated as necessary
to address changes in regulatory requirements, authoritative guidance, evolving oversight practices, and Ms. Marinello qualify as “audit committee financial experts” as defined by the SEC’s regulations. The Committee annually selects the Company’s independent registered public accounting firm (“auditor”).
shareholder feedback.
Management is responsible for the Company’s internal controls and the financial reporting process and has delivered its opinion on the effectiveness of the Company’s controls. The auditor is responsible for performing an independent audit of the Company’s consolidated financial statements and opining on the effectiveness of those controls in accordance with the standards of the Public Company Accounting Oversight Board (United States) (the “PCAOB”) and issuing its reports thereon. As provided in its charter, the Committee’s responsibilities include monitoring and overseeing these processes.
Required Disclosures
In 2017, the Committee met seven times and fulfilled all of its core charter obligations, spending a significant amount of time on completing a request for proposal process for independent audit services. The Committee conducted an extensive and competitive review involving a number of accounting firms and subsequently appointed EY as the Company’s independent registered public accounting firm for fiscal year 2018. EY will also providenon-audit services, including among others, cybersecurity and information technology assessment services and tax planning and advice and tax compliance, which are also areas of importance to the Committee. Deloitte was the Company’s independent registered public accounting firm for fiscal year 2017. The Committee has also reviewed and amended its charter and the Company’s Code of Conduct, “Winning with Integrity.”
Consistent with its charter responsibilities, the Committee has met and held discussions with management and Deloitte & Touche LLP, the Company’s auditor for 2015, regarding
the Company’s audited financial statements and internal controls for the year ended December 31, 2015.2017. In this context, management represented to the Committee that the Company’s consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States. The Committee reviewed and discussed the consolidated financial statements with management and the auditor and further discussed with the auditor the matters required to be discussed by the standards of the PCAOB.
The Company’s auditor hasDeloitte also provided to the Committee the written disclosures and the letter required by the applicable requirements of the PCAOB concerning independence, and the Committee has discussed with the auditor the auditor’s independence. The Committee has also considered and determined that the provision ofnon-audit services provided to GM is compatible with maintaining the auditor’s independence. The Committee concluded that Deloitte iswas independent from the Company and its management.
Recommendation
Based upon the Committee’s discussions with management and the auditor as described in this report and the Committee’s review of the representation of management and the reports of the auditors to the Committee, the Committee recommended to the Board of Directors, and the Board of Directors approved, the inclusion of the audited consolidated financial statements in the Company’s Annual Report on Form10-K for the year ended December 31, 2015,2017, as filed with the SECU.S. Securities and Exchange Commission on February 3, 2016.6, 2018.
Audit Committee
Thomas M. Schoewe (Chair)
Linda R. Gooden
Jane L. Mendillo
Michael G. Mullen
The preceding Audit Committee Report shall not be deemed incorporated by reference by any general statement incorporating by reference this Proxy Statement or any portion hereof into any filing under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, and shall not otherwise be deemed filed thereunder.
REASONS FOR SELECTION TO COMMITTEEWhen selecting directors to serve on the Committee, the Governance Committee and Board of Directors considers, among other factors: independence, financial literacy and expertise, and individual skills. FINANCIAL LITERACY AND EXPERTISE The Board has determined that all members of the Committee are financially literate and that Mr. Schoewe, Ms. Gooden, and Ms. Mendillo qualify as “audit committee financial experts” as defined by the SEC’s regulations.
ITEM NO. 3 – RATIFICATION OF THE SELECTION OF ERNST & YOUNG LLP AS
THE COMPANY’S INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR 2018
Fees Paid to Independent Registered Public Accounting Firm
The Audit Committee retained Deloitte to audit the Company’s consolidated financial statements and the effectiveness of internal controls, as of and for the year ended December 31, 2015.2017. The Company and its subsidiaries also retained Deloitte and certain of its affiliates, as well as other accounting and consulting firms, to provide various other services in 2015.2017. Deloitte initially presentspresented the proposed annual audit services and their related fees to the Audit Committee for approval on an audit-year basis.
The services performed by Deloitte in 20152017 were preapproved in accordance with the preapproval policy and procedures established by the Audit Committee. This policy requires that prior to the provision of services by the auditor, the Audit Committee will be presented, for consideration, with a description of the types of Audit-Related, Tax, and All Other Services expected to be performed by the auditor during the fiscal year, with amounts budgeted for each category (Audit-Related, Tax, and All Other Services). Any requests for such services for $1 million or more not contemplated and approved by the Audit Committee initially must thereafter be submitted to the Audit Committee (or the Chair of the Audit Committee in an urgent case) for specific preapproval. Requests for services less than $1 million individually can be approved by management based on the amounts approved for each category. Management must report actual spending for each category to the full Audit Committee periodically during the year.
These services are actively monitored (both spending level and work content) by the Audit Committee to maintain the appropriate objectivity and independence in Deloitte’s core work, which is the audit of the Company’s consolidated financial statements and internal control.controls. The Audit Committee determined that all services provided by Deloitte in 20152017 were compatible with maintaining the independence of Deloitte.
The following table summarizes Deloitte fees billed or expected to be billed in connection with 20152017 services. For comparison purposes, actual billings for 20142016 services are also displayed.
2015 | 2014 | |||||||
Type of Fees | ($ in millions) | ($ in millions) | ||||||
Audit | 32 | 36 | ||||||
Audit-Related | 5 | 7 | ||||||
Tax | 5 | 7 | ||||||
Subtotal | 42 | 50 | ||||||
All Other Services | 3 | 1 | ||||||
TOTAL | 45 | 51 |
Type of Fees | 2017 ($ in millions) | 2016 ($ in millions) | ||||||
Audit
|
|
26
|
|
|
33
|
| ||
Audit-Related
|
|
6
|
|
|
6
|
| ||
Tax
|
|
5
|
|
|
5
|
| ||
Subtotal
|
|
37
|
|
|
44
|
| ||
All Other Services
|
|
6
|
|
|
6
|
| ||
TOTAL
|
|
43
|
|
|
50
|
|
Audit Fees– Includes fees for the integrated audit of the Company’s annual consolidated financial statements and attestation of the effectiveness of the Company’s internal controls over financial reporting, including reviews of the interim financial statements contained in the Company’s Quarterly Reports on Form10-Q and audits of statutory financial statements.
Audit-Related Fees– Includes fees for assurance and related services that are traditionally performed by the independent registered public accounting firm. More specifically, these services include employee benefit plan audits, comfort letters in connection with funding transactions, other attestation services, and consultation concerning financial accounting and reporting standards.
Tax Fees– Includes fees for tax compliance, tax planning, and tax advice. Tax compliance involves preparation of original and amended tax returns and claims for refund. Tax planning and tax advice encompass a diverse range of services, including assistance with tax audits and appeals, tax advice related to mergers and acquisitions and employee benefit plans, and requests for rulings or technical advice from taxing authorities.
All Other Fees– Includes fees for other advisory services related to risk management, contract compliance activities, and product-related data enhancement.
71 |
ITEM NO. 4 – SHAREHOLDER PROPOSAL REGARDING INDEPENDENT BOARD CHAIRMAN
Holy Land Principles, Inc., Capitol Hill, P.O. Box 15128, Washington, D.C. 20003-0849,James Dollinger, 6193 Stonegate Parkway, Flint, MI 48532, owner of approximately 13450 shares of GM common stock, has given notice that ithe intends to present for action at the Annual Meetingannual meeting the following shareholder proposal:
Shareholders request our Board of Directors to adopt as policy, and amend our governing documents as necessary, to require henceforth that the Chair of the Board of Directors, whenever possible, to be an independent member of the Board. The Board would have the discretion to phase in this policy for the next CEO transition, implemented so it does not violate any existing agreement.
WHEREAS, General Motors Company has operations in Palestine-Israel;
WHEREAS, achievingIf the Board determines that a lasting peace inChairman who was independent when selected is no longer independent, the Holy Land —Board shall select a new Chair who satisfies the requirements of the policy within a reasonable amount of time. Compliance with security for Israelthis policy is waived if no independent director is available and justice for Palestinians — encourages us to promote a means for establishing justice and equality;
WHEREAS, fair employment should be the hallmark of any American company at home or abroad and is a requisite for any just society;
WHEREAS, Holy Land Principles, Inc., a non-profit organization, has proposed a set of equal opportunity employment principleswilling to serve as guidelinesChairman. This proposal requests that all the necessary steps be taken to accomplish the above.
Caterpillar is an example of a company recently changing course and naming an independent board chairman. Caterpillar
had strongly opposed a shareholder proposal for corporationsan independent board chairman as recently as its 2016 annual meeting. Wells Fargo also changed course and named an independent board chairman in Palestine-Israel.2016.
It was reported that 53% of the Standard & Poors 1,500 firms separate these 2 positions (2015 report): Chairman and CEO. This proposal topic won 50%-plus support at 5 major U.S. companies in 2013 including 73%-support at Netflix.
Having a board chairman who is independent of management is a practice that will promote greater management accountability to shareholders and lead to a more objective evaluation of management. This is of the utmost importance since the automobile industry is undergoing the greatest change since 1900. GM cannot afford to get it wrong.
This proposal topic won impressive 41%-support at our 2017 annual meeting. This 41%-support would have been higher (perhaps 45%) if small shareholders had the same access to corporate governance information as large shareholders.
Please vote to enhance the oversight of our CEO:Independent Board Chairman – Proposal 4.
The Board of Directors recommends a voteAGAINST this proposal for the following reasons:
These are:
u The Board should have the flexibility and is in the best position to decide who should serve as its Chairman. u Ms. Barra’s service as Chairman provides a clear and unified strategic vision for GM that fosters a nimble and responsive Board. u GM’s strong Independent Lead Director and commitment to governance best practices already ensure management accountability to shareholders by independent directors. |
Your Board should have the flexibility and is in the best position to determine who should serve as Chairman – whether that person is an independent director or CEO.
GM operates in a very competitive and fast-changing industry. Your Board and management must constantly assess industry change and disruption. Your Board is composed of directors with diverse backgrounds, experience, perspectives, andin-depth knowledge about the Company. With this expertise, it is uniquely positioned to evaluate the Company’s key challenges and needs, including the optimal Board leadership structure.
It is critical that your Board have the flexibility to choose the best person to serve as Chairman and not be arbitrarily constrained by aone-size-fits-all policy that has been empirically shown to have little relation to long-term shareholder value. The proposal would remove the Board’s current flexibility to determine the
leadership structure that it believes serves the best interests of the Company and its shareholders.
Your Board evaluates its leadership structure annually. This review will also occur in connection with any future CEO transition. Although your Board has in the past, and may again in the future, determine that separating the roles of Chairman and CEO would best serve shareholders, your Board presently believes that a combined role, coupled with a strong Independent Lead Director and other governance best practices, is in the best interests of shareholders at this time.
Your Board believes that Mary Barra’s service as Chairman and CEO has provided, and continues to provide, a clear and unified strategic vision for GM during this time of unprecedented industry change.
Your Board supports Ms. Barra’s service as both Chairman and CEO. Her dual service provides the Company with a clear and unified strategic vision, which fosters a more strategically focused Board that is responsive to industry trends and shareholder demands. During Ms. Barra’s tenure, GM has taken bold, strategic actions to grow long-term shareholder value, strengthened its core business and invested to lead in the future of mobility. More recently, with the Board’s full support, she has articulated GM’s vision for zero crashes, zero emissions, and zero congestion, outlined anall-electric future, and announced plans to deploy self-driving vehicles in a dense urban environment in 2019.
72 |
ITEM NO. 4 – SHAREHOLDER PROPOSAL REGARDING INDEPENDENT BOARD CHAIRMAN
Ms. Barra’s Board leadership is complemented by a strong Independent Lead Director.
While Ms. Barra’sin-depth knowledge of our businesses and understanding ofday-to-day operations brings focused leadership to your Board, the independent directors also recognize the importance of strong independent leadership. As the Independent Lead Director, Mr. Solso provides leadership and oversight for shareholders, including focus on strategic risk management, compliance, governance, and CEO succession planning. He regularly provides specific input on Board and Committee agendas and attends each Committee meeting. The specific duties of the Independent Lead Director are discussed on page 22 in this Proxy Statement. In addition, Mr. Solso maintains an office at our headquarters in Detroit, where he regularly provides mentorship and counsel to Ms. Barra and other members of senior management.
GM’s strong corporate governance practices reinforce Board independence and management accountability.
The Board has established and maintains numerousbest-in-class governance practices to reinforce and facilitate management accountability and provide meaningful independent oversight, including:
Annual election of directors;
Annual evaluation of CEO performance and compensation bynon-management directors;
Executive sessions held at most Board and Committee meetings without management present;
Six of our seven standing Committees, including the Executive Compensation Committee, are composed entirely of independent directors; and
Directors have unrestricted access to management and independent, outside advisors.
Your Board routinely engages directly with shareholders, reinforcing management accountability.
Since implementing the Director-Shareholder Engagement Policy in 2016, directors have conducted over a dozen individual meetings with our largest shareholders, representing approximately 30% of our outstanding common stock. These
engagements help shape the Board’s perspective on many issues, such as Board leadership, succession planning, and refreshment; executive compensation, including the link between corporate strategy and executive compensation; and corporate responsibility, environmental, social, and other current and emerging issues so that your Board and management can understand and address the issues that are important to our shareholders. Examples of the Board incorporating feedback include proactively adopting proxy access (2016) and making significant changes to our compensation programs (2017). In addition, in connection with last year’s proxy contest with Greenlight Capital, your Board utilized engagement opportunities to discuss its director nominees and strategy for creating long-term shareholder value with investors, which led to an overwhelming victory for GM at the 2017 Annual Meeting. Your Board’s engagement efforts demonstrate its commitment to ensuring that management and your Board are accountable to shareholders.
Your Board’s current leadership structure is consistent with the practices of the largest U.S. public companies.
According to Shearman & Sterling’s 2017 Corporate Governance & Executive Compensation Survey of the 100 largest
U.S. public companies, only 12 companies have a policy that requires separate individuals to serve as chairman and CEO, while the overwhelming majority of corporate policies provide boards with the flexibility to separate or combine the positions. Contrary to the proponent’s statements, your Board’s flexible approach to its leadership structure does not make it an outlier among its peers.
Therefore, your Board of Directors recommends a voteAGAINST this shareholder proposal.
73 |
ITEM NO. 5 – SHAREHOLDER PROPOSAL REGARDING SHAREHOLDER RIGHT TO ACT BY WRITTEN CONSENT
John Chevedden, 2215 Nelson Avenue, No. 205, Redondo Beach, CA 90278, owner of approximately 100 shares of GM common stock, has given notice that he intends to present for action at the annual meeting the following shareholder proposal:
Shareholders request that our board of directors undertake such steps as may be necessary to permit written consent by shareholders entitled to cast the minimum number of votes that would be necessary to authorize the action at a meeting at which all shareholders entitled to vote thereon were present and voting. This written consent is to be consistent with applicable law and consistent with giving shareholders the fullest power to act by written consent consistent with applicable law. This includes shareholder ability to initiate any topic for written consent consistent with applicable law.
This proposal topic won majority shareholder support at 13 major companies in a single year. This included 67%-support at both Allstate and Sprint. Hundreds of major companies enable shareholder action by written consent.
Taking action by written consent in lieu of a meeting is a means shareholders can use to raise important matters outside the normal annual meeting cycle. A shareholder right to act by
written consent and to call a special meeting are 2 complimentary ways to bring an important matter to the attention of both management and shareholders outside the annual meeting cycle. More than 100 Fortune 500 companies provide for shareholders to call special meetings and to act by written consent.
General Motors shareholders have no right to act by written consent. Shareholders of companies incorporated in Delaware, like General Motors, automatically have the right to act by written consent. However, the GM charter specifically takes away this important right. GM shareholders also do not have the full right to call a special meeting that is available under Delaware law.
This proposal could receive a substantial supporting vote at the 2018 GM annual meeting. It might get a still higher vote if small shareholders would have the advantage of the same access to independent corporate governance recommendations as large shareholders.
Please vote to improve director accountability to shareholders:Shareholder Right to Act by Written Consent – Proposal 5.
74 |
ITEM NO. 5 – SHAREHOLDER PROPOSAL REGARDING SHAREHOLDER RIGHT TO ACT BY WRITTEN CONSENT
The Board of Directors recommends a voteAGAINST this proposal for the following reasons:
u The proposal would significantly limit the right of | ||
RESOLVED: Shareholders request the Board of Directors to:
Make all possible lawful efforts to implement and/or increase activity on each of the eight Holy Land Principles.
Supporting Statement
The proponent believes that GM benefits by hiring from the widest available talent pool. An employee’s ability to do the job should be the primary consideration in hiring and promotion decisions. Implementation of the Holy Land Principles — which are both pro-Jewish and pro-Palestinian — will demonstrate concern for human rights and equality of opportunity in its international operations. Please vote your proxy FOR these concernsimportant matters.
u The right to call for a special meeting is a preferred, fair, and transparent mechanism for shareholders to consider important matters. | ||||
A simple-majority written consent provision is NOT in the best interests of shareholders because it would significantly limit the right of ALL shareholders to consider and be heard on important matters.
Your Board believes that all shareholders – not just a simple majority – should have an opportunity to hear about and express their views on important shareholder proposals. Because there is no requirement that a written consent be distributed to all shareholders, actions permitted to be taken by the written consent of a simple majority of shareholders could deprive many shareholders of the critical opportunity to assess, discuss, deliberate, and vote on pending actions.
Further, a simple-majority written consent provision caters particularly to special and short-term interests. The proposal would permit these special and short-term interests to bypass our existing procedural protections and marginalize smaller shareholders. Multiple shareholder groups could solicit written consents simultaneously, some of which may be duplicative or contradictory. In addition, the Board would not have the opportunity to consider the merits of the proposed action and provide its recommendation for shareholder consideration.
The concerns are not merely theoretical. Just last year, GM shareholders overwhelmingly voted against a flawed, high-risk shareholder proposal to create a dual-class of common stock. However, had that proposal been more universally supported it
is not inconceivable that with a simple-majority written consent provision the proponent could have forced adoption of its proposal without resorting to the open proxy voting process.
GM’s shareholders already have a preferable, fair, and transparent mechanism to advance their concerns outside of the annual meeting process: special meetings.
Shareholders that are able to demonstrate a relatively modest level of support (25% of shares that would be entitled to vote) for their concerns can call for a special meeting of shareholders. Your Board believes that this mechanism is preferable to a simple-majority written consent provision because it is much more fair and transparent to ALL shareholders.
GM’s commitment to shareholder engagement and governance best practices enhances Board accountability and preserves a meaningful voice for shareholders.
The Board has also adopted a variety of other practices and policies that enhance Board accountability to shareholders, including:
• | Annual election of directors; |
• | Proxy access rights; |
• | Active shareholder engagement process, including a Director-Shareholder Engagement Policy; and |
• | Direct line of communication from shareholders to the Board. |
In addition, on an annual basis, the Governance Committee reviews GM’s governance program, discusses best practices, and considers shareholder feedback. For a detailed discussion of our governance best practices, see “Proxy Statement Summary—Governance Highlights” on page 3 and “Corporate Governance” on page 20.
Therefore, your Board of Directors recommends a voteAGAINST this shareholder proposal.
75 |
ITEM NO. 6 – SHAREHOLDER PROPOSAL REGARDING REPORT ON GREENHOUSE GAS EMISSIONS AND CAFE STANDARDS
Whereas: Global action on climate change is accelerating. The Paris Agreement’s goal of keeping global temperature rise below 2 degrees Celsius is already shaping global, national, and local policy decisions.
Transportation accounts for more than 23 percent of global carbon dioxide emissions; this sector will need to deliver major emissions cuts for countries to achieve the Paris goal. (WEO 2017). In the U.S., a recent study found that greenhouse gas (GHG) reductions beyond those achievable from current vehicle emission reduction standards will be necessary by 2025 to meet global climate goals.1
Globally, governments are adopting transportation policies requiring significant fuel economy increases, and are beginning to promote low carbon vehicle technology standards. China will require 40 percent of cars sold by 2030 to be electric and intends to ban vehicles with internal combustion engines. Other countries and cities have announced, and California is considering, similar measures.
Many automakers have announced plans in line with this decarbonizing transportation market. Volvo committed that, by 2019, all new models will be electrified. BMW committed to sell 100,000 electrified vehicles in 2017 and that 20 to 25 percent of its sales will beplug-in hybrids or EVs by 2025. General Motors will need to undertake aggressive action to compete successfully in this transition to low carbon transportation.
In 2012, the U.S. issued light duty vehicle rules strengthening GHG emission reduction standards and improving corporate average fuel economy standards (collectively “CAFE standards”). These rules are being challenged by General Motors (GM) and other automakers. 2
The proposed weakening of CAFE standards will lead to additional greenhouse gas emissions, regulatory uncertainty,
and significant reputational risk for automakers. A public, grassroots campaign was recently launched demanding that automakers end their advocacy for rollback of CAFE standards.3
Although over 243,000 GM vehicles with electrification features have been sold as of 2016, this is a very small percentage of the company’s overall fleet sales. GM has announced a decision to accelerate and expand electrification of its global fleet, but has not specified sales targets, percentages of planned electric drive vehicles, or what percentage of its fleet will have electrification features. Coupled with lobbying to weaken CAFE standards, serious questions exist as to whether the company will retreat in reducing fleetwide GHG emissions, especially through 2025, a critical window of opportunity for the industry to meet climate goals. This uncertainty exposes the company to reputational harm, public controversy, and the potential to quickly lose global competitiveness.
General Motors’ actions have created investor concern about the alignment of its fleet emissions with an increasingly low carbon global vehicle market.
Resolved: Shareholders request that General Motors, with Board oversight, publish a report, at reasonable cost, describing whether our company’s fleet GHG emissions through 2025 will increase, given the industry’s proposed weakening of CAFE standards or, conversely, how GM plans to retain emissions consistent with current CAFE standards, to ensure its products are sustainable in a rapidly decarbonizing vehicle market.
http://ns.umich.edu/new/releases/25157-beyond-epa-s-clean-power-decision-climate-action-window-could-close-as-early-as-2023 |
2 | https://www.nytimes.com/2017/02/22/business/energy-environment/automakers-pruitt-mileage-rules.html?_r=0 |
3 | https://www.sierraclub.org/press-releases/2017/10/go-forward-not-backward-environmental-and-consumer-groups-launch-campaign |
76 |
ITEM NO. 6 – SHAREHOLDER PROPOSAL REGARDING REPORT ON GREENHOUSE GAS EMISSIONS AND CAFE STANDARDS
The Board of Directors recommends a voteAGAINST the adoption of this shareholder proposal for the following reasons:
u GM believes climate change isreal and advocates for climate action.
u GM is committed to zero emissions, and we are changing our business model to succeed in a carbon-constrained world. u We are confident that GM’s fleet average GHG emissions will NOT increase through 2025. u GM already provides transparent GHG emissions disclosure. |
GM believes that climate change is real and advocates for climate action.
GM acknowledged long ago that climate change is real, and we have consistently advocated – in public forums – for climate action and awareness. GM is a founding member of the Climate Leadership Council, the only automaker to have signed the Ceres BICEP Climate Declaration and one of the first companies to sign the American Business Act on Climate Pledge. In addition, GM supported the goal of a decarbonized transportation sector through a World Economic Forum Auto Governors letter.
We agree with the proponent that aggressive action is required to complete the transition to low-carbon transportation. Effectively addressing a complex challenge like climate change requires collaboration among various stakeholders from both inside and outside the auto industry. To that end, we frequently engage stakeholders in a variety of ways, with the goal of creating a meaningful dialogue to develop effective ways to combat climate change. A critical part of our strategy is regular engagement with an external sustainability stakeholder advisory group – which we have invited the proponent to join – that is coordinated through Ceres, a nonprofit organization advocating for corporate sustainability leadership. This group, now in its eighth year, consists of nongovernmental organizations, socially conscious investors, academics, a peer company, a fleet customer, and a supplier, to help inform our sustainability strategy as well as provide feedback about opportunities and challenges.
GM is committed to providing fair employment throughoutzero crashes, zero emissions, and zero congestion, and we are changing our business to succeed in a carbon-constrained world.
We believe that the convergence of connectivity, electric and other alternative propulsion systems, autonomous vehicles and the sharing economy will truly enable us to stretch the boundaries of what is possible in addressing climate change and developing vehicles that are safer, smarter, cleaner, and more energy-efficient than ever before. To advance our vision of a zero emissions world, we will introduce 20 newall-electric vehicles by 2023. In addition, we are also pursuing a variety of strategies to
improve the fuel efficiency of our internal combustion engine vehicles, including light-weighting, improved aerodynamics, shifting to downsized turbo engines, and incorporating stop/start technology in more of our vehicles. Although a zero emissions future won’t arrive overnight, GM is already lowering GHG emissions from its products and facilities – GM has committed to using 100% renewable energy in its operations globally. We have robust policiesby 2050. These actions and procedures in placeothers make us confident that GM’s fleet average GHG emissions will NOT increase through 2025.
Regardless of any changes to support our long-standingU.S. CAFE standards, GM’s commitment to equal employment opportunity, non-discriminationzero emissions will not change.
We support one national set of standards that comprehends new technologies and diversityshared and autonomous electric vehicles, and we remain committed to improving fuel economy, reducing emissions, and an all-electric future. Regardless of any proposals relative to CAFE standards for cars and light trucks for model years 2022–2025, our overall commitment to zero emissions and our strategy to achieve that commitment will not change. Nothing showcases this commitment more than our leadership in eachelectric vehicles and the Chevrolet Bolt EV – the first EV for everyone with 238 miles of range on a single charge and a price of less than $30,000 after tax incentives.
GM already provides transparent GHG emissions disclosure.
GM’s annual Sustainability Report (available atgmsustainability.com) discloses GM’s progress on our operationsproducts’ fuel efficiency and emissions goals as well as our approach to fuel economy regulations around the world, includingworld. GM also annually discloses our GHG emissions performance in Israel. These policies and procedures also support our objective to provide a workplace environment that naturally encourages each employee to contribute to their highest potential and to be engaged in accomplishing GM’s vision of buildingits CDP Climate Change Report (formerly known as the world’s most valued automotive company. They reflect our respect for employee differences as a source of innovation,Carbon Disclosure Project), which is criticalpublicly available through our Sustainability Report.
We look forward to GM’s success.working with all parties, including the proponent, on modernized standards that achieve better fuel economy for our customers and a better environment for everyone.
Our commitment to integrity in the workplace can be found in GM’s Code of Conduct,Winning With Integrity: Our Values and Guidelines for Employee Conduct(“Winning With Integrity”),which describes the policies and expectations that guide the conduct of our employees worldwide. Winning With Integrity can be found on the Company’s website, www.gm.com/investor, by clicking on “Investors,” then “Corporate Governance.”
“Our commitment on an all-electric, zero-emissions future is unwavering regardless of any modifications to future fuel economy standards, especially in the United States.” – Mary Barra, Chairman & CEO, at the Bank of America Merrill Lynch 2018 New York Auto Summit on March 28, 2018 |
TheTherefore, your Board of Directors recommends a voteAGAINSTAGAINST this shareholder proposal, Item No. 4.proposal.
77 |
QUESTIONS AND ANSWERSGENERAL INFORMATION ABOUT THE ANNUAL MEETING
Voting and |
Vote requirements and Board recommendations
Agenda Item | Description | Board Recommendation | Vote Requirement for Approval | Effect of Abstentions | Effect of Broker Non-Vote | |||||
1 | Election of Directors(1) | FOR | Majority of votes cast | No effect | No effect | |||||
2 | Approval of, on an Advisory Basis, NEO compensation | FOR | Majority of shares present (in person or by proxy) and entitled to vote | Counted as “AGAINST” | No effect | |||||
3 | Ratification of the Selection of Ernst & Young LLP as the Company’s Independent Registered Public Accounting Firm for 2018 | FOR | Counted as “AGAINST” | Discretionary Vote | ||||||
4 | Shareholder Proposal Regarding Independent Board Chairman | AGAINST | Counted as “AGAINST” | No effect | ||||||
5 | Shareholder Proposal Regarding Shareholder Right to Act by Written Consent | AGAINST | Counted as “AGAINST” | No effect | ||||||
6 | Shareholder Proposal Regarding Report on Greenhouse Gas and CAFE Standards | AGAINST | Counted as “AGAINST” | No effect |
Each person elected as director will serve aone-year term and until his or her successor has been duly elected and qualified or until his or her earlier resignation or removal. If any nominee becomes unable to serve, proxies will be voted for the election of such other person as the Board may designate, unless the Board chooses to reduce the number of |
Other matters to be presented at the Annual Meeting
We do not know of any matters to be voted on by shareholders at the Annual Meeting other than those included in this Proxy Statement. If any other matter is properly presented at the meeting, your executed proxy gives the Proxies (as defined below) discretionary authority to vote your shares in accordance with its best judgment with respect to the matter.
Attending the Annual Meeting
Only shareholders and authorized guests of the Company may attend the Annual Meeting, and all attendees will be required to show a valid form of ID (such as a government-issued form of photo identification). If you hold your shares in street name (i.e., through a bank or broker), you must also provide proof of share ownership, such as a letter from your bank or broker or a recent brokerage statement.
Large bags, backpacks and packages, suitcases, briefcases, personal communication devices (e.g., cell phones, smartphones, and tablets), cameras, recording equipment, and other electronic devices will not be permitted in the meeting, and attendees will be subject to security inspections.
Quorum
The presence of the holders of a majority of the outstanding shares of our common stock, in person or by proxy, will constitute a quorum for transacting business at the Annual Meeting. Abstentions and brokernon-votes are counted as present for purposes of establishing a quorum at the meeting.
Proxies
The Board appointed the following executive officers to act as proxies: Mary T. Barra, Daniel Ammann, and Charles K. Stevens, III (collectively, the “Proxies”). If you sign and return your proxy card or voting instruction form with voting instructions, one or more of Directors recommends thatthe Proxies will vote your shares as you direct on the matters described in this Proxy Statement. If you sign and return your proxy card or voting instruction form without voting instructions, one or more of the Proxies will vote your shares as follows:recommended by the Board.
Who can vote
Holders of record of our common stock as of the close of business on April 8, 2016,16, 2018, are entitled to vote at the Annual Meeting. On that date, the Company had 1,539,751,5191,409,441,782 shares of common stock outstanding and entitled to vote. Each share of our common stock entitles the holder to one vote.
78 |
GENERAL INFORMATION ABOUT THE ANNUAL MEETING
Voting without attending the Annual Meeting
When you timely submit your proxy or voting instructions in the proper form, your shares will be voted according to your instructions. You may give instructions to vote for or against or to abstain from voting for the election of all the Board of Directors’ nominees or any individual nominee and to vote for or against or to abstain from voting on,upon, each of the other matters submitted for voting. If you sign, date, and return the proxy card or voting instruction form without specifying how you wish to cast your vote, your shares will be voted by the Proxies according to the recommendations of the Board of Directors, as indicated in this Proxy Statement.above. Internet and telephone voting is available 24 hours a day, through 11:59 p.m. Eastern Timetime on Monday, June 6, 2016.11, 2018.
Voting at the Annual Meeting
ShareholdersYou may vote their proxyyour shares at the Annual Meeting by completing a ballot at the meeting. If you are a registered holder (i.e., you hold shares in any oneyour name), you must present a valid form of ID (such as a government-issued form of photo identification) to vote at the following ways:
By submitting your vote by Internet, telephone, or mailmeeting. If you are a beneficial shareholder and following the instructions on the proxy card or voting instruction form, you will authorize the Proxy Committeewant to vote your shares of our common stock asin person at the Annual Meeting, you directmust bring a signed legal proxy form from your broker, bank, or other nominee giving you the right to vote the shares and as they determine on all matterssubmit that we do not know about now, but that may be properly presentedlegal proxy with your ballot at the meeting. We encourage you to vote your shares in advance of the meeting, even if you plan to attend. Your vote at the meeting will supersede any prior vote by Internet or by telephone by following the instructions on theyou.
Revoking your proxy card or voting instruction form.
After you have submitted your proxy or voting instructions by Internet, telephone, or mail, you may revoke your proxy at any time until it is voted at the Annual Meeting. If you are a shareholder of record, you may do this by voting subsequently by Internet or telephone, submitting a new proxy card with a later date, sending a written notice of revocation to the Corporate Secretary at the address provided in“How can I obtain the Company’s corporate governance information?”on page 74,Mail Code482-C24-A68, 300 Renaissance Center, Detroit, Michigan 48265, or by voting in person at the Annual Meeting.
e-mail toshareholder.relations@gm.com.
If you are a beneficial shareholder, you may subsequently vote by Internet or telephone, or you may revoke your vote through your broker, bank, or other nominee in accordance with their instructions.
Annual Meeting voting results
As a matterOur independent inspector of policy, GM believes yourelections, Broadridge Financial Services, will tabulate the vote should be private except in contested elections. Therefore, we use an independent third party to receive, inspect, count, and tabulate proxies. Representatives of the independent third party also act as judges at the Annual Meeting. We will provide voting results on our website and in a Current Report on Form8-K filed with the SEC.
“Shareholder of record” and “Beneficial shareholder”
If your shares are owned directly in your name in an account with GM’s stock transfer agent, Computershare Trust Company, N.A. (“Computershare”), you are considered the “shareholder of record” of those shares in your account.
If your shares are held in an account with a broker, bank, or other nominee as custodian on your behalf, you are considered a “beneficial” shareholder of those shares, which are held in “street name.” The broker, bank, or other nominee is considered the shareholder of record for those shares. As the beneficial owner, you have the right to instruct the broker, bank, or other nominee on how to vote the shares in your account.
As a beneficial shareholder, In order for your shares to be voted in the way you would like, youmust provide voting instructions to your broker, bank, or other nominee by the deadline provided in the proxy materials you receive from your broker, bank, or other nominee to ensure your shares are voted the way you would like.nominee. If you do not provide voting instructions to your broker, bank, or other nominee, whether your shares can be voted on your behalf depends on the type of item being considered for vote. Under NYSE rules, brokers are permitted to exercise discretionary voting authority only on “routine” matters. Therefore, your broker may vote on Item No. 2 (Ratification3 (“Ratification of the Selection of DeloitteErnst & ToucheYoung LLP as the Company’s Independent Registered Public Accounting Firm for 2016)2018”) even if you do not provide voting instructions, because it is considered a routine matter.Your broker is not permitted to vote on the other Agenda Items if you do not provide voting instructions because those items involve matters that are considerednon-routine.
Householding
If your broker does not receive instructions from you on how to vote your shares and does not have discretion to vote on a proposal because it is a non-routine matter, the broker may return the proxy without voting on that proposal. This is known as a “broker non-vote.” A broker non-vote is deemed as not entitled to vote at the meeting with regard to a proposal so that it does not have any effect on the outcome of a vote.
The Proxy Committee, which is appointed by the Board, is composed of the following executive officers of the Company: Mary T. Barra, Daniel Ammann, and Charles K. Stevens, III. If you sign and return a proxy card or voting instruction form with voting instructions, one or more members of the Proxy Committee will vote your shares as you direct on the matters described in this Proxy Statement.If you sign and return a proxy card or voting instruction form without voting instructions, one or more members of the Proxy Committee will vote your shares as recommended by the Board.
Under GM’s Bylaws, directors are elected by a majority in uncontested elections and by a plurality in contested elections. A contested election is one in which the number of nominees exceeds the number of directors to be elected, and other conditions are met. In anuncontested election, nominees will be elected directors if they receive a majority of the votes cast (i.e., the number of shares voted “for” a director must exceed the number of votes cast “against” that director, without counting abstentions or broker non-votes). In acontested election, the nominees who receive a plurality of the votes cast (i.e., more votes in favor of their election than other nominees) will be elected directors.
The following table sets forth the vote required for approval and the effect of abstentions and broker non-votes for each of the following Agenda Items for the Annual Meeting.
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Yes. You may consent to receive your proxy materials and Annual Report by Internet, which will reduce the amount of paper you receive, our future postage and printing expenses, and the impact on the environment. At your request, you will be notified by e-mail when these documents are available electronically through the Internet. If you are a shareholder of record, you may sign up for this service atwww.computershare.com/gm. If you are a beneficial shareholder, you should refer to the instructions provided by your broker, bank, or other nominee on how to receive electronic delivery of proxy materials. You may also enroll for electronic delivery when you vote by Internet.
The SEC permits companies to furnish proxy materials to shareholders through the Internet,send a process called “Notice and Access.” In that regard, we are mailing a Notice instead of a paper copy of the proxy materials to most of our shareholders. The Notice tells you how to access and review oursingle Proxy Statement and Annual Report on the Internet and howForm10-K or Notice to vote your shares after you have reviewed the proxy materials. If you would like to receive a paper copy of these proxy materials or electronic delivery of materials via e-mail, free of charge, you should follow the instructions for requesting such materials included in the Notice. Shareholders who have previously elected delivery of proxy materials electronically will receive an e-mail with instructions on how to access these proxy materials electronically. Shareholders who have previously elected to receive a paper copy of our proxy materials will receive a full paper set of these materials by mail.
The SEC permits companies to send a single envelope containing all of the Notices or a single copy of their Annual Report and Proxy Statement to any household at which two or more shareholders reside if it appears they are members ofthat share the same family.address, subject to certain conditions. Each shareholder will continue to receive a separate proxy card, voting instruction form, or Notice, and it will include the unique16-digit control number whichthat is needed to vote those shares.shares and to access and vote during the Annual Meeting. This procedure, referred to as householding, is intended to reduce“householding” rule will benefit both the shareholders and GM by reducing the volume of duplicate information shareholders receive and also to reduce expenses for companies. General Motors has instituted this procedure for its shareholders.
reducing GM’s printing and mailing costs.
If one set of these documents was sent to your household for the use of all GM shareholders in your household and one or more of you would prefer to receive additional sets or if multiple copies of these documents were sent to your household and you want to receive one set, please contact Broadridge Financial Solutions, Inc., by calling toll-free at866-540-7095 or by writing to Broadridge Financial Solutions, Inc., Householding Department, 51 Mercedes Way, Edgewood, New York 11717.
If a broker, bank, or other nominee holds your shares, please contact your broker, bank, or other nominee directly if you have questions about delivery of materials, require additional copies of the Proxy Statement or Annual Report on Form10-K,or wish to receive multiple copies of proxy materials by stating that you do not consent to householding.
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GENERAL INFORMATION ABOUT THE ANNUAL MEETING
Brokers, banks, and other nominees who want a supply of the Company’s proxy materials to send to beneficial owners should write to Broadridge Financial Solutions, Inc., 51 Mercedes Way, Edgewood, New York 11717.
Shareholder Proposals and Director Nominations |
We do not know of any matters to be voted on by shareholders at the Annual Meeting other than those included in this Proxy Statement. Your executed proxy gives the Proxy Committee authority to vote your shares in accordance with its best judgment with respect to any other matter that may properly come before the shareholders at the Annual Meeting in accordance with Rule 14a-4(c) of the SEC’s proxy rules, and the Proxy Committee intends to exercise its judgment accordingly in such circumstances.
If you are a shareholder of record, you may vote your shares at the Annual Meeting by completing a ballot at the meeting. If you are a beneficial shareholder and want to vote your shares in person at the Annual Meeting, you must bring a signed legal proxy from your broker, bank, or other nominee giving you the right to vote the shares, which must be submitted with your ballot at the meeting. You will not be able to vote your shares at the meeting without a legal proxy. Accordingly, we encourage you to vote your shares in advance by telephone, Internet, or by completing and mailing the enclosed proxy card or voting instruction form, even if you plan to attend the meeting. Your vote at the Annual Meeting will supersede any prior vote by you.
Rule for Inclusion in Next Year’s Proxy Statement | Director Nominees for Inclusion in Next Year’s Proxy Statement (Proxy Access) | Other Proposals or Nominees for Representation at Next Year’s Annual Meeting | |||||
Rules/Provisions |
SEC rules and our Bylaws permit shareholders to submit proposals for inclusion in our Proxy Statement if the shareholder and the proposal meet the requirements specified in SEC Rule14a-8. |
Our Bylaws permit a shareholder or group of shareholders (up to |
Our Bylaws require that any shareholder proposal, including a |
The presence of the holders of a majority of the outstanding shares of our common stock, in person or by proxy, will constitute a quorum for transacting business at the Annual Meeting. Abstentions and broker non-votes are counted as present for purposes of establishing a quorum at the meeting.
To attend the Annual Meeting, you must be a holder of our common stock as of the record date of April 8, 2016, and request an admission ticket in advance by following the instructions below.
If your shares are owned directly in your name in an account with Computershare, GM’s stock transfer agent, you must provide your name and address as shown on your account or voting materials with your admission ticket request. If you hold your shares in an account with a broker, bank, or other nominee, you must include proof of your stock ownership, such as a copy of the portion of your Notice or voting instruction form that shows your name and address or a letter from your broker, bank, or other nominee confirming your stock ownership as of April 8, 2016.The e-mail notification received with electronic delivery of proxy materials is not sufficient proof of stock ownership.
Please send your Annual Meeting admission ticket request and proof of stock ownership as described above to GM Stockholder Services by one of the following methods:
Because our space is limited, you may bring only one guest to the meeting. If you plan to bring a guest, you will need to provide the name of your guest when making your ticket request. Ticket requests will be processed in the order in which they are received and must be received no later than June 1, 2016. Please include your e-mail address or telephone number in your fax or mail communication in case we need to contact you regarding your ticket request. You will receive your admission ticket(s) by mail. On the day of the meeting, each shareholder must accompany their guest at the meeting entrance. Shareholders and accompanying guests must each have an admission ticket to enter the meeting. Both admission tickets will be issued in the shareholder’s name. Along with the admission ticket, each shareholder and accompanying guest will be required to present a form of government-issued photo identification, such as a driver’s license or passport. The admission ticket is not transferable.
Large bags, backpacks and packages, suitcases, briefcases, personal communication devices (e.g., cell phones, smartphones, and tablets), cameras, recording equipment, and other electronic devices will not be permitted in the meeting, and attendees will be subject to a security inspection.
Yes. There will be an audio webcast of our Annual Meeting on Tuesday, June 7, 2016, at 9:30 a.m. Eastern Time and it may be accessed atwww.gm.com/gmannualmeeting.Listening to our Annual Meeting audio webcast will not constitute attendance at the meeting, and you will not be able to cast a vote as a listener to the live audio webcast. For specific instructions on how to vote your shares, please see, “How do I vote without attending the Annual Meeting?”on page 69.
A list of shareholders of record entitled to vote at the Annual Meeting will be available for examination for a purpose that is germane to the meeting at General Motors Global Headquarters, 300 Renaissance Center, Detroit, Michigan, 48265, for 10 business days before the Annual Meeting between 9:00 a.m. and 5:00 p.m. Eastern Time, and also during thethis year’s Annual Meeting.
We will provide final voting results on our website and in a Form 8-K filed with the SEC.
Rule 14a-8 Proposals for Inclusion in Next Year’s Proxy Statement
SEC rules and our Bylaws permit shareholders to submit proposals for inclusion in our Proxy Statement if the shareholder and the proposal meet the requirements specified in SEC Rule 14a-8.
When to send these | Must be received at our principal executive offices no later than | No earlier thanDecember 14, 2018, and no later than 11:59 p.m. Eastern time onFebruary 12, 2019. | |||||
Where to send these | Mail to | ||||||
What to include | |||||||
Must conform to and include the information required by SECRule 14a-8. |
Director Nominees for Inclusion in Next Year’s Proxy Statement (Proxy Access)
We recently amended our Bylaws to permit a shareholder or group of shareholders (up to 20) who have owned a significant amount of common stock (at least 3 percent) for a significant amount of time (at least three years) to submit director nominees (up to 20 percent of the Board or two directors, whichever is greater) for inclusion in our Proxy Statement if the shareholder(s) and the nominee(s) satisfy the requirements specified in our Bylaws.
Must include
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Other Proposals or Nominees for Presentation at Next Year’s Annual Meeting
Our Bylaws require that any shareholder proposal, including a director nomination, that is not submitted for inclusion in next year’s Proxy Statement (either under SEC Rule 14a-8 or our proxy access bylaw), but is instead sought to be presented directly at the 2017 Annual Meeting, must be received at our principal executive offices no earlier than 180 days and no later than 120 days before the first anniversary of the 2016 Annual Meeting.
Annual Report on Form10-K and Other Investor Materials |
You may download a copy of GM’s corporate governance documentsour 2017 Annual Report on Form10-K by visiting the “Investors Contacts” section of our website atwww.gm.com/investorgm.com/investors., under “Corporate Governance. Other publications available for download at this website include our Proxy Statement, quarterly reports and our code of conduct,“Winning with Integrity.” ToAlternatively, you may request a printed copy of any of these documents, writepublications by writing to Jill E. Sutton, Corporate Secretary and Deputy General Counsel,Shareholder Relations at General Motors Company, Mail Code 482-C25-D24,Code:482-C23-A68, 300 Renaissance Center, Detroit, Michigan 48265 or sending anby e-mail to stockholder.services@gm.com.shareholder.relations@gm.com.
Cost of Proxy Solicitation |
You may download a copy of our 2015 Annual Report on Form 10-K by visiting our website atwww.gm.com/investor, under “Investor Contacts.” Alternatively, you may request a printed copy by writing to GM Stockholder Services at General Motors Company, Mail Code 482-C23-D24, 300 Renaissance Center, Detroit, Michigan 48265 or to stockholder.services@gm.com.
We will pay our cost for soliciting proxies for the 2016 Annual Meeting. The Company will distribute proxy materials andfollow-up reminders, if any, by mail and electronic means. We have engaged Morrow & Co.,Sodali, LLC (“Morrow”), a professional proxy solicitation firm, located at 470 West Avenue, Stamford, Connecticut 06902 to assist with the solicitation of proxies and to provide related advice and informational support for a service fee, plus customary disbursements. We expect to pay Morrow an aggregate fee, including reasonableout-of-pocket expenses, of up to $25,000, depending on the level of services actually provided.
GM directors, officers, and employees may also solicit proxies by mail, telephone, or personal visits. They will not receive any additional compensation for their services.
General Motors will provide copies of these proxy materials to banks, brokerage houses, fiduciaries, and custodians holding in their names shares of our common stock beneficially owned by others so that they may forward these proxy materials to the beneficial owners. As usual, we will reimburse brokers, banks, and other nominees for their reasonable expenses in forwarding proxy materials to beneficial owners.owners.
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APPENDIX A: RECONCILIATION OF GAAP AND
NON-GAAP FINANCIAL MEASURES
Our Company reports its financial results in accordance with generally accepted accounting principles in the United States (“GAAP”). However, management believes that certainnon-GAAP financial measures provide users with additional meaningful financial information.
Ournon-GAAP measures presented in this Proxy Statement include earnings before interest and taxes (“EBIT”)-adjusted, presented net of noncontrolling interests, earnings per share (“EPS”)-diluted-adjusted and adjusted automotive free cash flow. These measures relate to our continuing operations and not our discontinued operations or our assets and liabilities held
for sale. Our calculation of thesenon-GAAP measures may not be comparable to similarly titled measures of other companies due to potential differences between companies in the method of calculation. As a result, the use of thesenon-GAAP measures has limitations and should not be considered superior to, in isolation from, or as a substitute for related GAAP measures. See our Annual Report on Form10-K for the fiscal year ended December 31, 2017, and our subsequent filings with the SEC for additional information about thenon-GAAP measures presented herein, including a description of the use of such measures. The numbers in the tables below may not sum due to rounding.
($B, except Margin) | 2017 | |||
Net income attributable to stockholders | (3.9 | ) | ||
Income from discontinued operations, net of tax | 4.2 | |||
Subtract: | ||||
Automotive Interest Expense | (0.6 | ) | ||
Automotive Interest Income | 0.3 | |||
Income Tax (Expense) | (11.5 | ) | ||
Add Back Special Items1: | ||||
Ignition switch recall and related legal matters | 0.1 | |||
Venezuela related matters | 0.1 | |||
GMI restructuring | 0.5 | |||
Total Special items | 0.7 | |||
EBIT-adjusted | 12.8 | |||
Net Revenue | 146 | |||
EBIT-adjusted Margin | 8.8 | % |
1 | Additional information on adjustments available in our Annual Report on Form10-K for the year ended December 31, 2017. |
2017 | ||||
Diluted earnings (loss) per common share | (2.60 | ) | ||
Diluted loss per common share – discontinued operations | 2.82 | |||
Adjustments(a) | 0.44 | |||
Tax effect of adjustments(b) | (0.14 | ) | ||
Tax adjustments(c) | 6.10 | |||
EPS-diluted-adjusted | $ | 6.62 |
(a) | Refer to the reconciliation of EBIT-adjusted on a continuing operations basis above for adjustment details. |
(b) | The tax effect of each adjustment is determined based on the tax laws and valuation allowance status of the jurisdiction to which the adjustment relates. |
(c) | In the year ended December 31, 2017, these adjustments consist of the tax expense of $7.3 billion related to U.S. tax reform legislation and the establishment of a valuation allowance against deferred tax assets of $2.3 billion that will no longer be realizable as a result of the sale of the Opel/Vauxhall Business, partially offset by tax benefits related to tax settlements. These adjustments were excluded because impacts of tax legislation and valuation allowances are not considered part of our core operations. |
A-1 |
2017 | ||||
Net automotive cash provided by operating activities – continuing operations | 13.9 | |||
Less: capital expenditures – continuing operations | (8.4 | ) | ||
Adjustments1 | ||||
U.K. pension plan contribution | 0.2 | |||
GM Financial dividend | (0.6 | ) | ||
Total adjustments | (0.4 | ) | ||
Adjusted automotive free cash flow – continuing operations | 5.2 | |||
Net automotive cash used in operating activities – discontinued operations | — | |||
Less: capital expenditures – discontinued operations | (0.7 | ) | ||
Adjusted automotive free cash flow | 4.5 |
1 | Additional information on adjustments available in our Annual Report on Form10-K for the year ended December 31, 2017. |
A-2 |
APPENDIX B:ADDITIONAL INFORMATION
REGARDING CHANGE OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRMS
As reported on the Company’s Current Report on Form8-K, dated September 25, 2017, and amended on February 12, 2018, the Audit Committee approved the engagement of Ernst & Young LLP (“EY”) as the Company’s independent registered public accounting firm for the Company’s fiscal year ending December 31, 2018. Deloitte & Touche LLP (“Deloitte”) continued as the Company’s independent registered public accounting firm for the year ending December 31, 2017. On February 6, 2018, when the Company filed its Annual Report on Form10-K for the fiscal year ended December 31, 2017, with the U.S. Securities and Exchange Commission, Deloitte completed its audit of the Company’s consolidated financial statements for such fiscal year, and the Company’s retention of Deloitte as our independent registered public accounting firm with respect to the audit of Company’s consolidated U.S. GAAP financial statements ended as of that date.
u | Deloitte’s reports on our consolidated financial statements as of and for the fiscal years ended December 31, 2016 and 2017, did not contain any adverse opinion or disclaimer of opinion, nor were they qualified or modified as to uncertainty, audit scope, or accounting principles. |
u | During the fiscal years ended December 31, 2016 and 2017, and the subsequent interim period through February 6, 2018 (the effective date of Deloitte’s dismissal) there were: (i) no disagreements within the meaning of Item 304(a)(1)(iv) of Regulation |
u | During the fiscal years ended December 31, 2016 and 2017 and the subsequent interim period through February 6, 2018 (the effective date of Deloitte’s dismissal), neither the Company nor anyone on its behalf has consulted with EY regarding: (i) the application of accounting principles to a specific transaction, either completed or proposed, or the type of audit opinion that might be rendered on the Company’s financial statements, and neither a written report nor oral advice was provided to the Company that EY concluded was an important factor considered by the Company in reaching a decision as to any accounting, auditing, or financial reporting issue; (ii) any matter that was the subject of a disagreement within the meaning of Item 304(a)(1)(iv) of RegulationS-K and the related instructions; or (iii) any reportable event within the meaning of Item 304(a)(1)(v) of RegulationS-K. |
u | GM has been advised by each of EY and Deloitte that they will each have a representative present at the Annual Meeting and that such representatives will have the opportunity to make a statement if they desire to do so and are expected to be available to respond to appropriate questions. |
B-1 |
G E N E R A L M O T O R S GENERAL MOTORS COMPANY GENERAL MOTORS GLOBAL HEADQUARTERS MAIL CODE 482-C24-A68 300 RENAISSANCE CENTER DETROIT, MI 48265 | VOTE BY TELEPHONE OR INTERNET OR MAIL 24 Hours a Day, 7 Days a Week VOTE BY INTERNET - www.proxyvote.com or scan the QR code above Use the Internet to transmit your voting instructions up until 11:59 p.m. Eastern Time on Monday, June 11, 2018. Have this proxy card available when you access the website and follow the instructions to obtain your records and to create an electronic voting instruction form. | |
VOTE BY TELEPHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions up until 11:59 p.m. Eastern Time on Monday, June 11, 2018. Have this proxy card available when you call and then follow the instructions. VOTE IN PERSON If you are a registered shareholder (that is, you hold these shares in your name), you must present valid identification to vote at the meeting. If you are a beneficial shareholder (that is, these shares are held in the name of a broker, bank or other holder of record), you will also need to obtain a “legal proxy” from the holder of record to vote at the meeting. | ||
If you vote by Internet or telephone or in person, do not mail this proxy card. VOTE BY MAIL Mark, sign, and date this proxy card and promptly return it in the enclosed postage-paid envelope or return it to: Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. | ||
ELECTRONIC DELIVERY OF FUTURE SHAREHOLDER COMMUNICATIONS To reduce our future postage and printing expenses, and the impact on the environment, you can consent to receiving all future proxy statements, proxy cards, and annual reports electronically via e-mail or the Internet. To enroll for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access shareholder communications electronically in the future. |
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: |
E44393-P05180 KEEP THIS PORTION FOR YOUR RECORDS
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DETACH AND RETURN THIS PORTION ONLY | ||||
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED. |
GENERAL MOTORS COMPANY | ||||||||||||||||||||||||||||||||||||||||||||||
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1. | Election of Directors. | |||||||||||||||||||||||||||||||||||||||||||||
For | Against | Abstain | ||||||||||||||||||||||||||||||||||||||||||||
Nominees: | ||||||||||||||||||||||||||||||||||||||||||||||
1a. Mary T. Barra 1b. Linda R. Gooden 1c. Joseph Jimenez 1d. Jane L. Mendillo | ☐ ☐ ☐ ☐ | ☐ ☐ ☐ ☐ | ☐ ☐ ☐ ☐ | The Board of Directors recommends a voteFOR Board Items 2 and 3. 2. Approval of, on an Advisory Basis, Named Executive Officer Compensation 3. Ratification of the Selection of Ernst & Young LLP as GM’s Independent Registered Public Accounting Firm for 2018 | For ☐ ☐ | Against ☐ ☐ | Abstain ☐ ☐ | |||||||||||||||||||||||||||||||||||||||
1e. Michael G. Mullen 1f. James J. Mulva 1g. Patricia F. Russo 1h. Thomas M. Schoewe 1i. Theodore M. Solso 1j. Carol M. Stephenson 1k. Devin N. Wenig | ☐ ☐ ☐ ☐ ☐ ☐ ☐ | ☐ ☐ ☐ ☐ ☐ ☐ ☐ | ☐ ☐ ☐ ☐ ☐ ☐ ☐ | The Board of Directors recommends a voteAGAINST shareholder Items 4 through 6. 4. Shareholder Proposal Regarding Independent Board Chairman 5. Shareholder Proposal Regarding Shareholder Right to 6. Shareholder Proposal Regarding Report on Greenhouse Gas Emissions and CAFE Standards |
☐ ☐ | Against ☐ ☐ ☐ | Abstain ☐ ☐ ☐ | |||||||||||||||||||||||||||||||||||||||
NOTE:Please sign exactly as your name(s) appear(s) hereon. When shares are | ||||||||||||||||||||||||||||||||||||||||||||||
Signature [PLEASE SIGN WITHIN BOX] | Date | |||||||||||||||||||||||||||||||||||||||||||||
Signature (Joint Owners) | Date | |||||||||||||||||||||||||||||||||||||||||||||
Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Proxy Statement, Notice of 2018 Annual Meeting of Shareholders and Annual Report
are available atwww.proxyvote.com.
PLEASE VOTE TODAY!
SEE REVERSE SIDE FOR THREE EASY WAYS TO VOTE
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E44394-P05180
G E N E R A L M O T O R S
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned shareholder(s) of General Motors Company authorize(s) Mary T. Barra, Daniel Ammann, and Charles K. Stevens, III, and each of them as proxies with full power of substitution, to vote the common stock of the undersigned in the manner specified on this proxy card and in their discretion upon all other matters that may come before the 2018 Annual Meeting of Shareholders of General Motors Company, to be held at 9:30 a.m. Eastern Time on June 12, 2018 or any adjournment or postponement thereof. The undersigned hereby revokes all proxies previously given.
On matters for which you do not specify a choice, the shares will be voted in accordance with the recommendation of the Board of Directors; therefore, if no direction is made, this proxy will be voted FORALL of General Motors Company’s director nominees in Item 1; FOR Items 2 and 3; and AGAINST Items 4 through 6.
YOUR VOTE IS VERY IMPORTANT - PLEASE VOTE TODAY
Please see the reverse side for Internet, telephone and in person voting instructions.
(Continued and to be marked, signed, and dated on the reverse side)