Cover
Cover | 12 Months Ended |
Dec. 31, 2022 | |
Document Information [Line Items] | |
Document Type | DEF 14A |
Amendment Flag | false |
Entity Information [Line Items] | |
Entity Registrant Name | CUMMINS INC. |
Entity Central Index Key | 0000026172 |
Pay vs Performance Disclosure
Pay vs Performance Disclosure pure in Millions | 12 Months Ended | ||
Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Pay vs Performance Disclosure [Table] | |||
Pay vs Performance [Table Text Block] | PAY VERSUS PERFORMANCE DISCLOSURE Cummins’ executive compensation program is designed to align pay outcomes with annual and long-term business performance and shareholders’ interests. Our program design choices, including the level of pay at risk, the mix of short-term and long-term incentives, the mix of long-term incentive vehicles, the metrics selected, and the rigor of incentive goals, all work together toward this objective. The TMCC, along with its consultant, Farient, has historically and routinely assessed the relationship between realizable pay for our executives and the financial and TSR performance of the company. The results of these analyses have guided our pay decisions and the evolution of our pay program to ensure strong pay and performance alignment. The new Pay vs. Performance disclosure, as required by the SEC, provides an additional perspective on pay and performance alignment by evaluating the link between “Compensation Actually Paid,” herein referred to as “CAP”, as defined by the SEC, and various measures of market and financial performance. PAY VERSUS PERFORMANCE TABLE The following table shows the past three fiscal years’ total compensation for our Named Executive Officers (NEOs) as set forth in the “Summary Compensation Table,” the CAP paid to our NEOs, the company’s total shareholder return (TSR), the combined TSR of our selected peer group (our “Custom Peer Group,” as used in our 2022 executive pay benchmarking), our net income, and our EBITDA. 2022 Pay vs. Performance Table Year Summary Summary Compensation Compensation Average Average Value of Initial CMI Peer Net EBITDA 2022 $11,521,051 $7,133,411 $6,424,086 $8,912,042 $3,223,819 $4,301,797 $146.4 $154.5 $2,151 $3,799 2021 $15,645,919 N/A $17,265,880 N/A $5,560,018 $4,868,941 $128.3 $146.1 $2,131 $3,251 2020 $17,291,581 N/A $27,870,614 N/A $4,213,127 $4,975,391 $130.5 $124.2 $1,789 $3,108 (1) In the table above, our First CEO is N. Thomas Linebarger, who served as CEO until August 1, 2022 (2) Our Second CEO is Jennifer W. Rumsey, who became CEO on August 1, 2022 (3) The other NEOs for each applicable year are: – 2022: S. Barner, T. Embree, S. Padmanabhan, LL. Satterthwaite, and M.A. Smith – 2021: J.W. Rumsey, S. Padmanabhan, LL. Satterthwaite, and M.A. Smith – 2020: M.M. Rose, S. Padmanabhan, LL. Satterthwaite, and M.A. Smith (4) The Peer Group TSR shown in the table above is based on our Custom Peer Group as shown in our CD&A for the applicable year. TSR for this Group is weighted as of year-end 2019 by market capitalization (5) The SEC rules require that certain adjustments be made to the Summary Compensation Table totals to determine CAP, as reported in the Pay versus Performance table above. The following table details the applicable adjustments that were made to determine CAP: Pension Benefits & NQDC Equity Awards Year Executives SCT Total Deduct SCT Add Actuarial Add Above- Deduct Add Year- Add Add Change Deduct Add 2022 Second CEO $7,133,411 $0 $114,724 $0 $(4,478,567 ) $5,582,361 $626,521 $(66,409 ) $0 $0 First CEO $11,521,051 $(24,768 ) $764,004 $5,498 $(5,024,835 ) $1,302,551 $3,940,845 $(1,539,696 ) $(4,520,563 ) $0 Avg. NEO $3,223,819 $0 $219,179 $0 $(1,165,115 ) $1,538,663 $783,631 $(241,070 ) $(62,824 ) $5,515 2021 First CEO $15,645,919 $(465,336 ) $782,182 $96,695 $(6,879,016 ) $6,140,641 $(1,342,278 ) $3,287,072 $0 $0 Avg. NEO $5,560,018 $(709,264 ) $168,006 $19,548 $(2,706,755 ) $2,342,987 $(257,279 ) $445,398 $0 $6,281 2020 First CEO $17,291,581 $(5,456,681 ) $641,715 $104,110 $(4,998,723 ) $12,793,206 $6,785,352 $710,054 $0 $0 Avg. NEO $4,213,127 $(1,590,422 ) $149,945 $32,876 $(1,013,647 ) $2,146,951 $968,628 $127,410 $(59,476 ) $0 | ||
Company Selected Measure Name | EBITDA | ||
Named Executive Officers, Footnote [Text Block] | (1) In the table above, our First CEO is N. Thomas Linebarger, who served as CEO until August 1, 2022 (2) Our Second CEO is Jennifer W. Rumsey, who became CEO on August 1, 2022 (3) The other NEOs for each applicable year are: – 2022: S. Barner, T. Embree, S. Padmanabhan, LL. Satterthwaite, and M.A. Smith – 2021: J.W. Rumsey, S. Padmanabhan, LL. Satterthwaite, and M.A. Smith – | ||
Peer Group Issuers, Footnote [Text Block] | (4) The Peer Group TSR shown in the table above is based on our Custom Peer Group as shown in our CD&A for the applicable year. TSR for this Group is weighted as of year-end 2019 by market capitalization | ||
Adjustment To PEO Compensation, Footnote [Text Block] | (5) The SEC rules require that certain adjustments be made to the Summary Compensation Table totals to determine CAP, as reported in the Pay versus Performance table above. The following table details the applicable adjustments that were made to determine CAP: Pension Benefits & NQDC Equity Awards Year Executives SCT Total Deduct SCT Add Actuarial Add Above- Deduct Add Year- Add Add Change Deduct Add 2022 Second CEO $7,133,411 $0 $114,724 $0 $(4,478,567 ) $5,582,361 $626,521 $(66,409 ) $0 $0 First CEO $11,521,051 $(24,768 ) $764,004 $5,498 $(5,024,835 ) $1,302,551 $3,940,845 $(1,539,696 ) $(4,520,563 ) $0 Avg. NEO $3,223,819 $0 $219,179 $0 $(1,165,115 ) $1,538,663 $783,631 $(241,070 ) $(62,824 ) $5,515 2021 First CEO $15,645,919 $(465,336 ) $782,182 $96,695 $(6,879,016 ) $6,140,641 $(1,342,278 ) $3,287,072 $0 $0 Avg. NEO $5,560,018 $(709,264 ) $168,006 $19,548 $(2,706,755 ) $2,342,987 $(257,279 ) $445,398 $0 $6,281 2020 First CEO $17,291,581 $(5,456,681 ) $641,715 $104,110 $(4,998,723 ) $12,793,206 $6,785,352 $710,054 $0 $0 Avg. NEO $4,213,127 $(1,590,422 ) $149,945 $32,876 $(1,013,647 ) $2,146,951 $968,628 $127,410 $(59,476 ) $0 | ||
Non-PEO NEO Average Total Compensation Amount | $ 3,223,819 | $ 5,560,018 | $ 4,213,127 |
Non-PEO NEO Average Compensation Actually Paid Amount | $ 4,301,797 | 4,868,941 | 4,975,391 |
Adjustment to Non-PEO NEO Compensation Footnote [Text Block] | (5) The SEC rules require that certain adjustments be made to the Summary Compensation Table totals to determine CAP, as reported in the Pay versus Performance table above. The following table details the applicable adjustments that were made to determine CAP: Pension Benefits & NQDC Equity Awards Year Executives SCT Total Deduct SCT Add Actuarial Add Above- Deduct Add Year- Add Add Change Deduct Add 2022 Second CEO $7,133,411 $0 $114,724 $0 $(4,478,567 ) $5,582,361 $626,521 $(66,409 ) $0 $0 First CEO $11,521,051 $(24,768 ) $764,004 $5,498 $(5,024,835 ) $1,302,551 $3,940,845 $(1,539,696 ) $(4,520,563 ) $0 Avg. NEO $3,223,819 $0 $219,179 $0 $(1,165,115 ) $1,538,663 $783,631 $(241,070 ) $(62,824 ) $5,515 2021 First CEO $15,645,919 $(465,336 ) $782,182 $96,695 $(6,879,016 ) $6,140,641 $(1,342,278 ) $3,287,072 $0 $0 Avg. NEO $5,560,018 $(709,264 ) $168,006 $19,548 $(2,706,755 ) $2,342,987 $(257,279 ) $445,398 $0 $6,281 2020 First CEO $17,291,581 $(5,456,681 ) $641,715 $104,110 $(4,998,723 ) $12,793,206 $6,785,352 $710,054 $0 $0 Avg. NEO $4,213,127 $(1,590,422 ) $149,945 $32,876 $(1,013,647 ) $2,146,951 $968,628 $127,410 $(59,476 ) $0 | ||
Compensation Actually Paid vs. Total Shareholder Return [Text Block] | |||
Compensation Actually Paid vs. Net Income [Text Block] | |||
Total Shareholder Return Vs Peer Group [Text Block] | As shown in the graph below, our company’s TSR has generally tracked that for our Custom Peer Group on a market capitalization weighted basis. | ||
Tabular List [Table Text Block] | 2022 PERFORMANCE MEASURES For fiscal year 2022, our TMCC identified the performance measures listed below as the most important in its compensation-setting process for our NEOs. Tabular List of Performance Measures EBITDA ROIC ROANA Cash Flow The Committee identified EBITDA, ROIC, ROANA, and Cash Flow as our “most important” measures because they have been or will be used in our incentive awards (cash flow will be introduced in 2023). These measures drive the largest portion of our executives’ pay. EBITDA, ROIC, and ROANA provide an incentive for profitable growth and correlate well with shareholder value. Operating cash flow provides capital for investments that are important to our future and allows us to return significant capital to our shareholders. | ||
Total Shareholder Return Amount | $ 146.4 | 128.3 | 130.5 |
Peer Group Total Shareholder Return Amount | 154.5 | 146.1 | 124.2 |
Net Income (Loss) | $ 2,151,000,000 | $ 2,131,000,000 | $ 1,789,000,000 |
Company Selected Measure Amount | 3,799 | 3,251 | 3,108 |
PEO Name | N. Thomas Linebarger | ||
Measure [Axis]: 1 | |||
Pay vs Performance Disclosure [Table] | |||
Measure Name | EBITDA | ||
Measure [Axis]: 2 | |||
Pay vs Performance Disclosure [Table] | |||
Measure Name | ROIC | ||
Measure [Axis]: 3 | |||
Pay vs Performance Disclosure [Table] | |||
Measure Name | ROANA | ||
Measure [Axis]: 4 | |||
Pay vs Performance Disclosure [Table] | |||
Measure Name | Cash Flow | ||
N.Thomas Linebarger [Member] | |||
Pay vs Performance Disclosure [Table] | |||
PEO Total Compensation Amount | $ 11,521,051 | $ 15,645,919 | $ 17,291,581 |
PEO Actually Paid Compensation Amount | 6,424,086 | 17,265,880 | 27,870,614 |
N.Thomas Linebarger [Member] | Change In Pension Value [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 24,768 | 465,336 | 5,456,681 |
N.Thomas Linebarger [Member] | Actuarial Pension Service Cost [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 764,004 | 782,182 | 641,715 |
N.Thomas Linebarger [Member] | Above-Market Earnings on NQDC [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 5,498 | 96,695 | 104,110 |
N.Thomas Linebarger [Member] | Stock and Option Awards [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 5,024,835 | 6,879,016 | 4,998,723 |
N.Thomas Linebarger [Member] | Year-End Value of Unvested Equity Granted in Year [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 1,302,551 | 6,140,641 | 12,793,206 |
N.Thomas Linebarger [Member] | Change in Value of Unvested Awards Granted in Prior Years [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 3,940,845 | (1,342,278) | 6,785,352 |
N.Thomas Linebarger [Member] | Change in Value of Vested Equity Granted in Prior Years [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | (1,539,696) | 3,287,072 | 710,054 |
N.Thomas Linebarger [Member] | Value of Awards Not Meeting Vesting Conditions [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 4,520,563 | 0 | 0 |
N.Thomas Linebarger [Member] | Dividends Paid on Unvested Equity [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 0 | 0 | 0 |
Jennifer W. Rumsey [Member] | |||
Pay vs Performance Disclosure [Table] | |||
PEO Total Compensation Amount | 7,133,411 | ||
PEO Actually Paid Compensation Amount | 8,912,042 | ||
Jennifer W. Rumsey [Member] | Change In Pension Value [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 0 | ||
Jennifer W. Rumsey [Member] | Actuarial Pension Service Cost [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 114,724 | ||
Jennifer W. Rumsey [Member] | Above-Market Earnings on NQDC [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 0 | ||
Jennifer W. Rumsey [Member] | Stock and Option Awards [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 4,478,567 | ||
Jennifer W. Rumsey [Member] | Year-End Value of Unvested Equity Granted in Year [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 5,582,361 | ||
Jennifer W. Rumsey [Member] | Change in Value of Unvested Awards Granted in Prior Years [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 626,521 | ||
Jennifer W. Rumsey [Member] | Change in Value of Vested Equity Granted in Prior Years [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | (66,409) | ||
Jennifer W. Rumsey [Member] | Value of Awards Not Meeting Vesting Conditions [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 0 | ||
Jennifer W. Rumsey [Member] | Dividends Paid on Unvested Equity [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 0 | ||
Non-PEO NEO [Member] | Change In Pension Value [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 0 | 709,264 | 1,590,422 |
Non-PEO NEO [Member] | Actuarial Pension Service Cost [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 219,179 | 168,006 | 149,945 |
Non-PEO NEO [Member] | Above-Market Earnings on NQDC [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 0 | 19,548 | 32,876 |
Non-PEO NEO [Member] | Stock and Option Awards [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 1,165,115 | 2,706,755 | 1,013,647 |
Non-PEO NEO [Member] | Year-End Value of Unvested Equity Granted in Year [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 1,538,663 | 2,342,987 | 2,146,951 |
Non-PEO NEO [Member] | Change in Value of Unvested Awards Granted in Prior Years [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 783,631 | (257,279) | 968,628 |
Non-PEO NEO [Member] | Change in Value of Vested Equity Granted in Prior Years [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | (241,070) | 445,398 | 127,410 |
Non-PEO NEO [Member] | Value of Awards Not Meeting Vesting Conditions [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | 62,824 | 0 | 59,476 |
Non-PEO NEO [Member] | Dividends Paid on Unvested Equity [Member] | |||
Pay vs Performance Disclosure [Table] | |||
Adjustment to Compensation Amount | $ 5,515 | $ 6,281 | $ 0 |