DEF 14A of Johnson & Johnson, Mar 15, 2023

DEF 14A of Johnson & Johnson

Filed Mar 15, 2023 · FY20220000200406-23-000023

Open on EDGAR

  1. Corporate Governance Highlights

    | Responsive and Accountable to Shareholders | | | Annual Election of Directors | Each director is elected annually to ensure accountability to our shareholders. | | Majority Voting Standard for Director Elections | In an election where the number of directors nominated does not exceed the total number of directors to be elected, director nominees must receive the affirmative vote of a majority of votes cast to be elected. If a director nominee receives more votes “against” his or her election than votes “for” his or her election, the director must promptly offer his or her resignation. | | One Class of Stock | Our common stock is the only class of shares outstanding. | | Proxy Access | Each shareholder or a group of up to 20 shareholders owning 3% or more of our common stock continuously for at least three years may nominate and include in our proxy materials director nominees constituting up to 20% of the Board, in accordance with the terms set forth in our By-Laws. | | Director Overboarding Policy | A director who serves as CEO at our or any other company should not serve on more than two public company boards. Other directors should not serve on more than five public company boards. | | No Shareholder Rights Plan | We do not have a "poison pill" and have no intention of adopting one at this time. | | No Supermajority Requirements in Certificate of Incorporation or By-Laws | Our Restated Certificate of Incorporation, as amended, and By-Laws contain majority standards for all actions requiring shareholder approval. | | Shareholder Right to Call a Special Meeting | Shareholders holding 10% of shares may call a special meeting for good cause, and shareholders holding 25% of shares may call a special meeting for any reason. | | Removal of Directors With or Without Cause | Directors may be removed by shareholders with or without cause. | | Active Shareholder Engagement | See pages 43 to 45 for more information on our shareholder engagement program. | | Annual Say on Pay Advisory Vote | Shareholders are asked to vote annually on our named executive officer compensation. |

  2. Disclosure on Environmental, Social and Governance Topics

    | | | Darius Adamczyk | | | | Independent Director since 2022 | | Biography | | | | Mr. Adamczyk, age 57, has been the Chairman and Chief Executive Officer of Honeywell International Inc. since April 2018. Mr. Adamczyk was President and Chief Executive Officer from March 2017 to April 2018 and Chief Operating Officer from April 2016 to March 2017. From April 2014 to April 2016, Mr. Adamczyk served as President and CEO of Honeywell Performance Materials and Technologies (PMT). Prior to serving as President and CEO of PMT, Mr. Adamczyk served as President of Honeywell Process Solutions from 2012 to 2014 and as President of Honeywell Scanning and Mobility from 2008 to 2012. Mr. Adamczyk joined Honeywell in 2008 when Honeywell acquired Metrologic, Inc., where he was the Chief Executive Officer. Prior to Metrologic, Mr. Adamczyk held several general management assignments at Ingersoll Rand, served as a senior associate at Booz Allen Hamilton and started his career as an electrical engineer at General Electric. He is a member of the US-China Business Council, Business Roundtable and The Business Council. | | | | Skills & Qualifications | | | | • | Senior leadership roles in global organizations | | | • | Deep understanding of software, both technically and commercially, and a proven track record in growing software-related businesses | | | • | Demonstrated ability to deliver financial results as a leader in a variety of industries, with disparate business models, technologies and customers | | | • | Strategic leadership skills necessary to grow sales organically and inorganically while meeting the challenges of a constantly changing environment across a diverse portfolio | | | Current Committees: | | | | • | Member, Compensation & Benefits | | | Other Public Board Service: | | | | • | Honeywell International Inc. (since 2016) | | | Recent Past Public Board Service: | | | | • | Garrett Motion Inc. (April 2021 - September 2021) | |

  3. Disclosure on Environmental, Social and Governance Topics

    | | | Mary C. Beckerle, Ph.D. | | | | Independent Director since 2015 | | Biography | | | | Dr. Beckerle, age 68, has served as Chief Executive Officer of the Huntsman Cancer Institute at the University of Utah since 2006. She is the Associate Vice President for Cancer Affairs and a Distinguished Professor of Biology and Oncological Sciences at the University of Utah. Dr. Beckerle joined the faculty of the University of Utah in 1986 and currently holds the Jon M. Huntsman Presidential Endowed Chair. Dr. Beckerle has served on the National Institute of Health (NIH) Advisory Committee to the Director, on the Board of Directors of the American Association for Cancer Research, on the Board of Scientific Advisors for the National Cancer Institute, as President of the American Society for Cell Biology and as the Chair of the American Cancer Society Council for Extramural Grants. She currently serves on a number of scientific advisory boards, including the Medical Advisory Board of the Howard Hughes Medical Institute. Dr. Beckerle is the recipient of a Guggenheim Fellowship and is an elected Member of the National Academy of Sciences and the American Philosophical Society. | | | | Skills & Qualifications | | | | • | Expertise in scientific research and organizational management in the healthcare arena | | | • | Active participant in national and international scientific affairs | | | • | Strong focus on patient experience | | | Current Committees: | | | | • | Chair, Science & Technology | | | • | Member, Regulatory Compliance & Sustainability | | | Other Public Board Service: | | | | • | Huntsman Corporation (since 2011) | |

  4. Disclosure on Environmental, Social and Governance Topics

    | | | D. Scott Davis | | | | Independent Director since 2014 | | Biography | | | | Mr. Davis, age 71, served as Chairman and Chief Executive Officer of United Parcel Service, Inc. (UPS) (shipment and logistics) from 2008 to 2014 and as Chairman from 2014 to 2016. Previously, Mr. Davis held various leadership positions with UPS, primarily in the finance and accounting area, including as Vice Chairman and Chief Financial Officer. Mr. Davis is a Certified Public Accountant. He previously served on the Board of the Federal Reserve Bank of Atlanta from 2003 to 2009, serving as Chairman in 2009. | | | | Skills & Qualifications | | | | • | Deep understanding of emerging markets and international operations, public policy and global economic indicators | | | • | Expertise in management, strategy, finance and operations | | | • | Expertise in supply chain logistics at a time of rapid global expansion in the healthcare industry | | | Current Committees: | | | | • | Chair, Audit | | | • | Member, Nominating & Corporate Governance | | | • | Member, Consumer Health Special | | | Other Public Board Service: | | | | • | Honeywell International Inc. (since 2005) | |

  5. Disclosure on Environmental, Social and Governance Topics

    | | | Jennifer A. Doudna, Ph.D. | | | | Independent Director since 2018 | | Biography | | | | Dr. Doudna, age 59, joined the faculty at University of California, Berkeley, as a Professor of Biochemistry & Molecular Biology in 2002. She directs the Innovative Genomics Institute, a joint UC Berkeley-UC San Francisco center, holds the Li Ka Shing Chancellor's Professorship in Biomedical and Health and is the Chair of the Chancellor's Advisory Committee on Biology at UC Berkeley. Dr. Doudna is Principal Investigator at the Doudna Lab at UC Berkeley and has founded and serves on the Scientific Advisory Boards of Caribou Biosciences, Inc. and Intellia Therapeutics, Inc., both leading CRISPR genome engineering companies. She has been an Investigator with the Howard Hughes Medical Institute since 1997. Dr. Doudna is the recipient of numerous scientific awards in biochemistry and genetics, including the Nobel Prize in Chemistry in 2020. Dr. Doudna is a Trustee of Pomona College. | | | | Skills & Qualifications | | | | • | Pioneer in the field of biochemistry, having co-discovered the simplified genome editing technique CRISPR-Cas9 | | | • | Expertise in scientific research and innovation | | | • | Leader in integration of scientific research and ethics | | | Current Committees: | | | | • | Member, Nominating & Corporate Governance | | | • | Member, Science & Technology | | | Other Public Board Service: | | | | • | None | |

  6. Disclosure on Environmental, Social and Governance Topics

    | | | Joaquin Duato | | | | Management Director since 2022 | | Biography | | | | Mr. Duato, age 60, became Chairman of the Board of Directors in January 2023 subsequent to his appointment as Chief Executive Officer and a Director in January 2022. He joined the Company in 1989 with Janssen-Farmaceutica S.A. (Spain), a subsidiary, and held executive positions of increasing responsibility in all business sectors and across multiple geographies and functions. In 2009, he was named Company Group Chairman, Pharmaceuticals, and in 2011, he was named Worldwide Chairman, Pharmaceuticals. In 2016, Mr. Duato became a member of the Executive Committee and was named Executive Vice President, Worldwide Chairman, Pharmaceuticals. In July 2018, Mr. Duato was promoted to Vice Chairman of the Executive Committee where he provided strategic direction for the Company's Pharmaceutical and Consumer Health sectors, supply chain, information technology, global services and the Health & Wellness groups. As a dual citizen of Spain and the United States, Mr. Duato’s international perspective and global lens gives him a deep appreciation of diverse thoughts and opinions. | | | | Skills & Qualifications | | | | • | Decades of broad experience spanning multiple business sectors, geographies, and functions at the world's largest most diversified healthcare products company | | | • | Globally minded, purpose-driven business leader with a deep commitment to Our Credo values | | | Current Committees: | | | | • | Chair, Finance | | | Recent Past Public Board Service: | | | | • | Hess Corporation (2019 - 2022) | |

  7. Disclosure on Environmental, Social and Governance Topics

    | | | Marillyn A. Hewson | | | | Independent Director since 2019 | | Biography | | | | Ms. Hewson, age 69, is the former Chairman, President and Chief Executive Officer of Lockheed Martin Corporation (aerospace and defense), serving from January 2014 to June 2020 and as Executive Chairman from June 2020 to March 2021. She held the positions of Chief Executive Officer and President from January to December 2013. Ms. Hewson served as a Director of Lockheed Martin Corporation from 2012 through March 2021. Ms. Hewson joined Lockheed Martin in 1983 as an industrial engineer and held executive and operational leadership positions across Lockheed Martin, including President and Chief Operating Officer, Executive Vice President of Electronic Systems business area, and President of Systems Integration. Ms. Hewson is a fellow of the American Institute of Aeronautics and Astronautics and the American Academy of Arts and Sciences, and a member of the Trilateral Commission, Council on Foreign Relations, Council of Chief Executives, and the University of Alabama President’s Cabinet and Culverhouse College of Business Board of Visitors. Ms. Hewson has also served on several U.S. government advisory bodies, public company boards, industry association boards, and charitable organizations' boards. | | | | Skills & Qualifications | | | | • | Expertise in executive and operational leadership in a global, regulated industry | | | • | Insight and experience in global business management, strategic planning, cybersecurity, finance, supply chain, leveraged services and manufacturing | | | • | Expertise in government relations and human capital management | | | Current Committees: | | | | • | Chair, Compensation & Benefits | | | • | Member, Regulatory Compliance & Sustainability | | | Other Public Board Service: | | | | • | Chevron Corporation (since 2021) | | | Recent Past Public Board Service: | | | | • | DuPont; DowDuPont Inc. (2007-2019) | | | • | Lockheed Martin Corporation (2012-2021) | |

  8. Disclosure on Environmental, Social and Governance Topics

    | | | Paula A. Johnson, M.D. | | | | Independent Director since 2023 | | Biography | | | | Dr. Johnson, age 63, has served as President of Wellesley College since 2016. She is a physician-researcher specializing in cardiology who founded and served as the inaugural Executive Director of the Connors Center for Women’s Health and Gender Biology at Brigham and Women’s Hospital from July 2002 to June 2016. Dr. Johnson served as the Chief of the Division of Women’s Health at Brigham and Women’s Hospital from July 2002 to June 2016. She was also a Professor of Medicine at the Harvard Medical School and Professor of Epidemiology at the Harvard School of Public Health. She is a member of the National Academy of Medicine and the American Academy of Arts and Sciences. She has been recognized with several honorary doctorates and other prestigious awards. She has served as a member of the Board of Trustees of the Rockefeller University since November 2021 and as a Director of the Isabella Stewart Gardner Museum since 2015. | | | | Skills & Qualifications | | | | • | Expertise in medical research, public health, and health policy | | | • | Visionary in in understanding and improving the standard of care across distinct patient categories (notably in women’s health) | | | • | Proven leadership across complex organizations focused on cross functional collaboration and increased inclusivity. | | | • | Passionate educator focused on accessibility of STEM curriculum for diverse student populations. | | | Other Public Board Service: | | | | • | None | | | Recent Past Public Board Service: | | | | • | Abiomed, Inc. (2020-2022) | | | • | Eaton Vance Corp. (2018-2022) | | | • | West Pharmaceutical Services (2008-2021) | |

  9. Disclosure on Environmental, Social and Governance Topics

    | | | Hubert Joly | | | | Independent Director since 2019 | | Biography | | | | Mr. Joly, age 63, served as the Executive Chairman of Best Buy Co., Inc. (consumer electronics) from June 2019 to June 2020, having joined the company in 2012 as President and Chief Executive Officer and becoming Chairman, President and Chief Executive in 2015. From 2004 to 2008, he was Global President and Chief Executive Officer, Carlson Wagonlit Travel, and then served as President and Chief Executive Officer of Carlson Companies from 2008 to 2012. In 1999, he joined Vivendi as Global Chief Executive Officer, Vivendi Universal Games, and was later appointed Executive Vice President of U.S. Assets and Deputy Chief Financial Officer of Vivendi Universal. Prior roles included, from 1996 to 1999, Vice President, Europe and President of Electronic Data Systems France and, from 1983 to 1996, McKinsey & Company, eventually serving as Partner. Mr. Joly is a Senior Lecturer of Business Administration at Harvard Business School and serves on the Board of Directors of Sciences Po Foundation, the Board of Trustees of the Minneapolis Institute of Art, the New York Public Library and the International Advisory Board of his alma mater, HEC Paris. | | | | Skills & Qualifications | | | | • | Extensive strategic, operational and financial expertise relevant to international corporations | | | • | Successfully led the digital transformation of consumer businesses, with focus on customer experience | | | • | Experience in business transformation and human capital management | | | Current Committees: | | | | • | Member, Compensation & Benefits | | | • | Member, Nominating & Corporate Governance | | | • | Member, Consumer Health Special | | | Other Public Board Service: | | | | • | Ralph Lauren Corporation (since 2009) | | | Recent Past Public Board Service: | | | | • | Best Buy Co., Inc. (2012-2020) | |

  10. Disclosure on Environmental, Social and Governance Topics

    | | | Mark B. McClellan, M.D., Ph.D. | | | | Independent Director since 2013 | | Biography | | | | Dr. McClellan, age 59, became the inaugural Director of the Duke-Robert J. Margolis, MD, Center for Health Policy and the Margolis Professor of Business, Medicine and Policy at Duke University in January 2016. He is also a faculty member at Dell Medical School at The University of Texas in Austin. Previously, he served from 2007 to 2015 as a Senior Fellow in Economic Studies and as Director of the Initiatives on Value and Innovation in Health Care at the Brookings Institution. Dr. McClellan served as Administrator of the Centers for Medicare & Medicaid Services for the U.S. Department of Health and Human Services from 2004 to 2006 and as Commissioner of the U.S. Food and Drug Administration (FDA) from 2002 to 2004. He served as a Member of the President's Council of Economic Advisers and as Senior Director for Healthcare Policy at the White House from 2001 to 2002 and, during the Clinton administration, held the position of Deputy Assistant Secretary for Economic Policy for the Department of the Treasury. Dr. McClellan previously served as an Associate Professor of Economics and Medicine with tenure at Stanford University, where he also directed the Program on Health Outcomes Research. Dr. McClellan is the founding Chair and Senior Advisor to the Board of the Reagan-Udall Foundation, is a Member of the National Academy of Medicine and the Academy's Leadership Consortium for Value and Science-Driven Health Care, and Co-Chairs the Guiding Committee of the Health Care Payment Learning and Action Network. He sits on the Boards of Directors of Research!America, Long Term Quality Alliance, Alignment Healthcare, National Alliance for Hispanic Health, PrognomiQ, Inc. and United States of Care. | | | | Skills & Qualifications | | | | • | Extensive experience in public health policy and regulation, including as Commissioner of the U.S. Food and Drug Administration and Administrator for the U.S. Centers for Medicare & Medicaid Services | | | • | Broad knowledge of, and unique insights into, the challenges facing the healthcare industry | | | Current Committees: | | | | • | Member, Regulatory Compliance & Sustainability | | | • | Member, Science & Technology | | | Other Public Board Service: | | | | • | Alignment Healthcare (since 2021) | | | • | Cigna Corporation (since 2018) | |

  11. Disclosure on Environmental, Social and Governance Topics

    | | | Anne M. Mulcahy | | | | Independent Director since 2009 Lead Director since 2012 | | Biography | | | | Ms. Mulcahy, age 70, was Chairman and Chief Executive Officer of Xerox Corporation (business equipment and services) until July 2009, when she retired as CEO after eight years in the position. Prior to serving as CEO, Ms. Mulcahy was President and Chief Operating Officer of Xerox. She also served as President of Xerox's General Markets Operations, which created and sold products for reseller, dealer and retail channels. Earlier in her career at Xerox, which began in 1976, Ms. Mulcahy served as Vice President for Human Resources with responsibility for compensation, benefits, human resource strategy, labor relations, management development and employee training; and as Vice President and Staff Officer for Customer Operations, covering South America and Central America, Europe, Asia and Africa. Ms. Mulcahy was the U.S. Board Chair of Save the Children from March 2010 to February 2017 and was appointed as a Trustee in February 2018. | | | | Skills & Qualifications | | | | • | Experience leading a large, global manufacturing and services company with one of the world's most recognized brands | | | • | Expertise in organizational and operational management issues crucial to a large public company | | | • | Deep commitment to business innovation and talent development | | | Current Committees: | | | | • | Chair, Nominating & Corporate Governance | | | • | Chair, Consumer Health Special | | | • | Member, Audit | | | • | Member, Finance | | | Other Public Board Service: | | | | • | Graham Holdings Company (since 2008) | | | • | LPL Financial Holdings Inc. (since 2013) | | | Recent Past Public Board Service: | | | | • | Williams-Sonoma, Inc. (2018 - 2022) | |

  12. Disclosure on Environmental, Social and Governance Topics

    | | | Mark A. Weinberger | | | | Independent Director since 2019 | | Biography | | | | Mr. Weinberger, age 61, served as the Global Chairman and Chief Executive Officer of EY (Ernst & Young) (professional services) from 2013 through June 2019, having served as Global Chairman and CEO-elect in the prior year. He was Assistant Secretary of the U.S. Treasury in the George W. Bush Administration and was appointed by President Bill Clinton to serve on the U.S. Social Security Administration Advisory Board. Mr. Weinberger serves as a Senior Advisor to Stone Canyon Industries Holdings Inc. and Teneo. He is an Executive Advisor to G100 and World 50. Mr. Weinberger also serves as a Strategic Advisor to the Board of FCLTGlobal, which focuses on long-term investing and corporate governance. Mr. Weinberger is on the CEO Advisory Council of JUST Capital. He sits on the Board of Directors of the National Bureau of Economic Research (NBER), is a Senior Advisor to Chief Executives for Corporate Purpose (CECP) and is a member of the Aspen Economic Strategy Group. He is a member of the Boards of Trustees for Emory University, Case Western Reserve University, The Concord Coalition, The Greater Washington Partnership and US Council for International Business. | | | | Skills & Qualifications | | | | • | Experience leading a business and working at the highest levels of government | | | • | Track record of driving transformative change in the public and private sectors during periods of unprecedented disruption | | | • | Expertise in accounting, compliance and corporate governance, with a strong commitment to corporate purpose | | | Current Committees: | | | | • | Chair, Regulatory Compliance & Sustainability | | | • | Member, Audit | | | • | Member, Consumer Health Special | | | Other Public Board Service: | | | | • | MetLife Inc. (since 2019) | | | • | Saudi Aramco (since 2019) | | | Recent Past Public Board Service: | | | | • | Accelerate Acquisition Corp. (2021 - 2022) | |

  13. Disclosure on Environmental, Social and Governance Topics

    | | | Nadja Y. West, M.D. | | | | Independent Director since 2020 | | Biography | | | | Dr. Nadja West, age 61, retired from the U.S. Army with the rank of Lieutenant General in October 2019. She served as the 44th Army Surgeon General and the Commanding General of the U.S. Army Medical Command from 2015 to 2019, overseeing the highest medical readiness and battlefield wound survival rates in history. As the Joint Staff Surgeon from 2013 to 2015, Dr. West was the principal medical advisor to the Chairman of the Joint Chiefs of Staff at the Pentagon, where she coordinated all related health services issues, including operational medicine, force health protection and readiness within the military. Her prior roles include Deputy Chief of Staff for Support, U.S. Army Medical Command from 2012 to 2013, ensuring proper resources and support for smooth operation of the entire command. From 2010 to 2012, Dr. West served as Commanding General of the Europe Regional Medical Command. She is the recipient of numerous U.S. military awards, including the Distinguished Service Medal, the Defense Superior Service Medal and the Legion of Merit with three Oak Leaf Clusters. Dr. West currently serves as Trustee of both the National Recreation Foundation and Mount St. Mary’s University; and board member of Americares and The Woodruff Foundation. | | | | Skills & Qualifications | | | | • | Proven executive and operational leadership, strategic planning and healthcare management | | | • | Expertise in government relations and human capital management | | | • | Operational crisis management and disaster response experience pertaining to global health issues | | | • | Extensive information security and cybersecurity experience | | | Current Committees: | | | | • | Member, Regulatory Compliance & Sustainability | | | • | Member, Science & Technology | | | Other Public Board Service: | | | | • | Nucor Corporation (since 2019) | | | • | Tenet Healthcare Corporation (since 2019) | |

  14. Oversight of Our Company

    | l | The Board conducts an extensive review of the Company's long-term strategic plans on an annual basis. The Board also reviews the long-term strategic plans of each business segment. | | l | Throughout the year, the Board reviews and discusses matters related to the Company's strategy with senior management to ensure our business activities are aligned with our short- and long-term strategy and that we are making progress toward our strategic goals. | | l | Independent directors hold regularly scheduled Executive Sessions without management present to discuss Company performance and review long-term strategy. Certain Committees also meet in private session with senior management in our financial, legal, compliance and quality functions, among others. | | l | The Board regularly discusses and reviews global economic, geopolitical, social, industry and regulatory trends and the competitive environment. The Board also considers feedback from our shareholders and other stakeholders to ensure that our short- and long-term strategies are appropriately designed to promote sustainable growth. | | l | The Board consults with external advisors to understand outside perspectives on the risks and opportunities facing our Company. |

  15. Key Elements of Our Executive Compensation Programs

    | Balanced Performance-Based Awards | Performance-based awards are based on the achievement of strategic and leadership objectives in addition to financial metrics and relative shareholder returns versus peers. | | Multi-Year Performance Period and Vesting | The performance period and vesting schedules for long-term incentives overlap and, therefore, reduce the motivation to maximize performance in any one period. Prior to 2023, grants of PSUs, restricted share units (RSUs) and options would vest three years from the grant date. Beginning with the February 13, 2023 grant, our options and RSUs will vest 1/3rd per year on each of the 1st, 2nd, and, 3rd anniversaries of the grant date. Our PSUs will continue to vest 100% on the third anniversary of the grant date. In addition, we do not pay out our PSUs until we determine the percent of target PSUs that have been earned based on performance. | | Balanced Mix of Pay Components | The target compensation mix is weighted toward long-term equity compensation vesting pro-rata over three years. | | Capped Incentive Awards | Annual performance bonuses and long-term incentive awards are capped at 200% of target. | | Stock Ownership Guidelines | Our CEO must directly or indirectly own equity in our Company equal to twelve times base salary, and the other members of our Executive Committee must own equity equal to six times base salary and retain this level of ownership at all times while serving as an Executive Committee member. | | No Change-in-Control Arrangements | None of our executive officers have in place any change-in-control arrangements that would result in guaranteed payouts. | | Compensation Recoupment Policy | The Board has the authority to recoup executive officers' past compensation in the event of a material restatement of our financial results and for significant misconduct resulting in a violation of Company policy or laws relating to the manufacturing, sales or marketing of our products. |

  16. Shareholder Engagement

    | • | Board Composition and Diversity | • | Executive Compensation and Performance Metrics | | • | Board Evaluation Process | • | Lead Director Responsibilities | | • | Board Oversight of Risk | • | Litigation | | • | Board Tenure and Refreshment | • | Pharmaceutical Pricing Transparency and Access | | • | CEO Transition | • | Product Quality and Safety | | • | Consumer Health Separation | • | Separation of the Chairman and CEO Roles | | • | COVID-19 Response and Vaccine | • | Shareholder Engagement and Communication | | • | Culture and Human Capital Management | • | Shareholder Proposals | | • | Diversity, Equity and Inclusion | • | Succession Planning and Talent Development | | • | ESG Issues and Reporting | • | Tax Policy |

  17. Director Compensation

    Director Compensation The Compensation & Benefits Committee charter requires annual review of non-employee director compensation, including total compensation and each element of our non-employee director compensation program. During its annual review, the Committee analyzes the competitive position of our non-employee director compensation program and each element of that program against the programs of the peer group used for executive compensation purposes (see page 83 for information about the Executive Peer Group). Semler Brossy Consulting Group, the Committee’s independent consultant, provides an independent assessment of the competitive data provided to the Committee and advises the Committee on non-employee director compensation. Decisions regarding the non-employee director compensation program are approved by the full Board based on recommendations by the Committee.

  18. Fiscal 2022 Non-Employee Director Compensation

    Fiscal 2022 Non-Employee Director Compensation On September 13, 2021, the Compensation & Benefits Committee recommended, and the Board approved, an increase to the non-employee director compensation program for 2022. The overall 2022 compensation structure was approximately at peer group median after the adjustment in 2021.

  19. Fiscal 2023 Non-Employee Director Compensation

    Fiscal 2023 Non-Employee Director Compensation The Compensation & Benefits Committee’s analysis in 2022 of the competitive position of our non-employee director compensation program showed that overall compensation for non-employee directors was approximately at peer group median. As a result, the Committee recommended, and the Board approved on September 13, 2022, no changes to the non-employee director compensation program for 2023. The following non-employee director compensation program for 2023 continues an overall compensation structure in line with the peer group median.

  20. Fiscal 2023 Non-Employee Director Compensation

    | 2023 Non-Employee Director Compensation | ($) | | Cash Compensation | $125,000 | | Lead Director Cash Retainer | 50,000 | | Audit Committee Chair Cash Retainer | 30,000 | | Committee Chair (other than Audit) Cash Retainer | 20,000 | | Value of Deferred Share Units | 195,000 |

  21. Fiscal 2023 Non-Employee Director Compensation

    The compensation of our directors for fiscal 2022 is set forth in the following table. In 2022, Mr. Gorsky, our former Chairman and Chief Executive Officer, was paid as a Company employee serving in the role of Executive Chairman. Mr. Gorsky transitioned to Executive Chairman on January 3, 2022, and retired as Executive Chairman at the end of fiscal year 2022. The leadership transition and decisions regarding his 2022 compensation are detailed in our March 16, 2022 proxy statement. For a complete understanding of the table, please read the accompanying footnotes and the narrative disclosures.

  22. Fiscal 2023 Non-Employee Director Compensation

    | | 2023 Proxy Statement | 53 |

  23. Fiscal 2023 Non-Employee Director Compensation

    | 2022 Total Director Compensation | | | | | | | | | A | B | C | D | E | F | G | H | | Name | Role for Additional Cash Retainer | Fees Earned or Paid in Cash | Stock Awards | Option Awards | Non-Equity Incentive Plan Compensation | All Other Compensation | Total | | D. Adamczyk | | $109,161 | $171,000 | $0 | $0 | $20,000 | $300,161 | | M. C. Beckerle | Comm Chair | $145,000 | $195,000 | $0 | $0 | $20,000 | $360,000 | | D. S. Davis | Comm Chair | $155,000 | $195,000 | $0 | $0 | $0 | $350,000 | | I. E. L. Davis | | $125,000 | $195,000 | $0 | $0 | $0 | $320,000 | | J. A. Doudna | | $125,000 | $195,000 | $0 | $0 | $20,000 | $340,000 | | A. Gorsky | | $0 | $12,988,366 | $5,069,898 | $2,444,000 | $1,693,302 | $22,195,566 | | M. A. Hewson* | Comm Chair | $138,588 | $195,000 | $0 | $0 | $20,000 | $353,588 | | H. Joly | | $125,000 | $195,000 | $0 | $0 | $20,000 | $340,000 | | M. B. McClellan | | $125,000 | $195,000 | $0 | $0 | $0 | $320,000 | | A. M. Mulcahy | LD/Comm Chair | $195,000 | $195,000 | $0 | $0 | $20,000 | $410,000 | | C. Prince | | $40,496 | $195,000 | $0 | $0 | $20,000 | $255,496 | | A. E. Washington | | $125,000 | $195,000 | $0 | $0 | $20,000 | $340,000 | | M. A. Weinberger | Comm Chair | $145,000 | $195,000 | $0 | $0 | $0 | $340,000 | | N. Y. West | | $125,000 | $195,000 | $0 | $0 | $20,000 | $340,000 | | R. Williams* | | $46,976 | $195,000 | $0 | $0 | $20,000 | $261,976 |

  24. Fiscal 2023 Non-Employee Director Compensation

    * Ms. Hewson replaced Mr. Williams as Chair of the Compensation & Benefits Committee in April 2022. The Chair retainer payment was prorated accordingly.

  25. Stock Awards (Column D)

    Stock Awards (Column D) For the non-employee directors: Deferred Share Units - Mandatory Deferral. All figures in column D represent the grant-date fair value computed in accordance with FASB ASC Topic 718 of Deferred Share Units (DSUs) granted to each non-employee director on February 15, 2022. The Board approved a 2022 DSU award valued at $195,000; therefore, pursuant to the terms of the Deferred Fee Plan for Directors, each non-employee director was granted 1,175 DSUs (rounded down to the nearest whole share). DSUs are immediately vested but must be deferred until termination of Board membership. DSUs earn additional amounts based on a hypothetical investment in our common stock, including accruing dividend equivalents in the same amount and at the same time as dividends paid on our common stock. DSUs are settled in cash upon termination of Board membership. For Mr. Gorsky, Column D includes the total grant date fair value of 66,282 Performance Share Unit (PSU) and 11,047 Restricted Share Unit (RSU) awards with a grant date fair value of $11,298,363 and $1,690,003, respectively. These awards were made to Mr. Gorsky on February 14, 2022 based on his performance as CEO in 2021. As detailed in our 2022 proxy statement, he will not be eligible for long-term incentive awards in 2023 for his service as Executive Chairman in 2022. The timing and details of Mr. Gorsky’s stock awards are consistent with those received by our named executive officers, as detailed in the 2022 Grants of Plan-Based Awards table on page 99. The aggregate number of PSUs and RSUs held by Mr. Gorsky as of January 1, 2023 was 227,715 and 32,545, respectively.

  26. Non-Equity Incentive Plan Compensation (Column F)

    Non-Equity Incentive Plan Compensation (Column F) For Mr. Gorsky, Column F includes his annual incentive payout for fiscal 2022 performance and dividend equivalents received in fiscal 2022 on vested Certificates of Long-Term Compensation (CLCs). Mr. Gorsky received the same enterprise payout multiplier (91.0%) that was applied to other enterprise executives, resulting in an annual incentive payout of $1,910,000 for fiscal 2022. For a detailed description of our annual incentive program, see Compensation Discussion and Analysis – 2022 Annual Incentives on page 66. We stopped granting CLCs to our executives in 2012. These cash-based long-term incentives have all vested and will be paid out in accordance with their original terms. This column includes the value of the dividend equivalents paid on Mr. Gorsky’s vested CLCs during fiscal 2022, which had a total value of $534,000.

  27. Additional Arrangements

    | Name | Stock Ownership Guideline as a Multiple of Annual Cash Retainer | 2022 Compliance with Stock Ownership Guidelines? | Ownership Threshold Met?(1) | | D. Adamczyk | 5x | Yes | No(2) | | M. C. Beckerle | 5x | Yes | Yes | | D. S. Davis | 5x | Yes | Yes | | I. E. L. Davis | 5x | Yes | Yes | | J. A. Doudna | 5x | Yes | Yes | | M. A. Hewson | 5x | Yes | Yes | | P. A. Johnson | 5x | N/A | No(2) | | H. Joly | 5x | Yes | Yes | | M. B. McClellan | 5x | Yes | Yes | | A. M. Mulcahy | 5x | Yes | Yes | | A. E. Washington | 5x | Yes | Yes | | M. A. Weinberger | 5x | Yes | Yes | | N. Y. West | 5x | Yes | No(2) | | (1)Non-employee directors have five years after first becoming subject to the guidelines to achieve the required ownership threshold. (2)Joined Board within past five years. | | | |

  28. Additional Arrangements

    | | | The Board of Directors recommends that shareholders vote, in an advisory manner, FOR approval of the compensation of our named executive officers and the executive compensation philosophy, policies and procedures described in the Compensation Discussion and Analysis (CD&A) section of this Proxy Statement. | | | Before you vote, we urge you to read the following for additional details on our executive compensation | | When casting your 2023 Say on Pay vote, we encourage you to consider: | | | | | l | Our named executive officers’ 2022 compensation is aligned with our 2022 performance, with annual incentives payouts aligned to business performance and performance share units (PSUs) paying out at target based on our financial results and our relative total shareholder return (TSR) performance during the performance period. | | l | Compensation Discussion and Analysis on pages 59 to 89 | l | We continue to engage with our shareholders on our executive compensation program and evaluate our programs to ensure alignment with our shareholders. | | | | l | Pay-for-performance alignment is built into the design of our incentive programs. | | l | Executive Compensation Tables on pages 90 to 122 | l | Our financial performance was strong despite continued uncertainty driven by global macroeconomic factors and the COVID-19 pandemic. | | | | We believe our executive compensation programs promote long-term, sustainable value creation and are strongly aligned with the long-term interests of our shareholders. The guiding principles of our executive compensation program continue to be pay for performance, accountability for short-term and long-term performance, alignment with shareholders’ interests and market competitiveness. We assess performance by reviewing not only what financial and strategic objectives were achieved but also how those results were achieved and whether they were achieved consistent with the values embodied in Our Credo. As an advisory vote, the results of this vote will not be binding on the Board or the Company. However, the Board and the Compensation & Benefits Committee value the opinions of our shareholders. They will consider the outcome of the vote when making future decisions on the compensation of our named executive officers and our executive compensation philosophy, policies and procedures. Following our Annual Meeting of Shareholders on April 27, 2023, the next advisory vote on executive compensation is expected to occur at the 2024 Annual Meeting of Shareholders, unless the Board modifies its policy on the frequency of holding such advisory votes. | |

  29. A Message from Our Compensation & Benefits Committee

    Dear Fellow Shareholders: Despite increasing macroeconomic headwinds, the Company delivered strong results in 2022. Across the businesses, the Company continued to accelerate the innovation pipeline, invest in R&D, and serve more patients and customers. The Company has also made great progress in executing the most significant strategic pivot in its history: the planned separation of the Consumer Health business. Every year, we review the executive compensation structure to ensure that we are incentivizing strong results in a manner that is consistent with the values embodied in Our Credo. We also engage with our shareholders to gain further feedback on the executive compensation program. The Company's 2022 Say on Pay vote won majority support at 86%. We believe that this strong support for the executive compensation program benefited from our direct engagement with our shareholders and the changes we made to our executive compensation program and processes over the past several years. In assessing 2022 performance, we conducted our annual joint review with the Audit Committee of all items excluded from non-GAAP performance measures for the purpose of measuring results under the incentive compensation plans. We determined that the compensation program encompassed the effect of special items through their impact on our long-term equity compensation and that no adjustments to incentive payouts related to non-GAAP items were warranted. Reflecting the strong 2022 results, the enterprise annual incentives paid out at 91.0% of target. The Committee used its discretion to lower the payout from 95.5% to 91.0% to align the payout more closely with those of the segments. The 2020-2022 PSUs paid out at 100.0% of target. We made no adjustments to the 2020-2022 PSU goals to reflect the impact of COVID-19. 2022 marked a year of transition, as Joaquin Duato assumed the role of Chief Executive Officer and Mr. Gorsky transitioned to become our Executive Chairman. Effective January 3, 2022, we adjusted their compensation to reflect their new roles. Mr. Gorsky retired at the end of fiscal year 2022 and Mr. Duato assumed the additional position of Chairman in January 2023. Throughout these changes, we believe adherence to the Company's long-term strategy makes the Company well-positioned to meet future challenges and opportunities. We thank you for your continued feedback and respectfully request your support for our 2023 Say on Pay proposal. Sincerely,

  30. What we did

    Treatment of Litigation Charges in Our Compensation Program. Following engagement with shareholders in 2021, we established a process to strengthen the oversight over the treatment of litigation charges in our compensation program. When determining the annual and long-term incentive plan payouts, we first consider non-GAAP results which exclude a range of special items (see pg. 68 and 72), including significant one-time litigation charges. There are several reasons why we generally exclude significant one-time litigation charges from performance measures for the purpose of deciding annual and long-term incentive plan payouts. •Including these litigation charges would create an incentive to postpone or forgo future legal actions that may be in the long-term interests of our shareholders. •They could also create inappropriate windfalls, when a resolution does not happen in the expected year or when a judgment is reversed through appeals processes that can span multiple years. •The impact of these litigation charges is already reflected in the Company’s share price, which provides a strong alignment with our shareholders.

  31. 2022 Annual Incentive Goals and Performance

    2022 Annual Incentive Goals and Performance

  32. Performance against our Enterprise 2022 Financial Goals (70% weight)

    Our enterprise financial targets align with the guidance we provided to the investment community. We believe this links our compensation to how effectively we deliver on our public commitments to our shareholders. We set our goals based on our objective of creating long-term sustainable value, our product portfolio and pipeline, and competitive benchmarking. See Our Annual Incentive Goal Setting Process on page 67 for details. We established maximum and threshold payout levels around the financial targets based on a review of historical performance for each metric. If performance falls between threshold and target or between target and maximum, we determine the payout factor using interpolation. If performance falls below threshold for a goal, the percentage earned for that goal is 0%. For the purposes of assessing performance under our annual incentive program, we make certain adjustments to our financial measures that have been prepared in accordance with accounting principles generally accepted in the U.S. (GAAP), as detailed on page 68.

  33. Performance against our Enterprise 2022 Financial Goals (70% weight)

    The Company’s performance was strong, particularly given the backdrop of macroeconomic volatility. However, our financial performance was mixed compared to our internal goals. At the enterprise level, we met our adjusted operational EPS goal, but operational sales and free cash flow fell below target. As shown below, our overall enterprise financial performance resulted in a calculated financial payout factor of 80.7% under our annual incentive plan.

  34. Performance against our Enterprise 2022 Financial Goals (70% weight)

    | 2022 Financial Measures | Weight | Threshold (50% Payout) | Target (100% Payout) | Maximum (200% Payout) | Results | Calculated Payout | Weighted Payout | | Operational Sales ($ millions) | 1/3rd | $92,910 | $97,800 | $102,690 | $97,028 | 92.1% | 30.7% | | Adjusted Operational EPS | 1/3rd | $10.17 | $10.70 | $11.23 | $10.70 | 100.0% | 33.3% | | Free Cash Flow ($ millions) | 1/3rd | $14,130 | $15,700 | $17,270 | $14,132 | 50.1% | 16.7% | | Financial Payout Factor | | | | | | | 80.7% |

  35. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    Performance against our Enterprise Long-Term Strategic Goals (30% weight)

  36. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | 2022 Strategic Goals |

  37. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    The strategic payout factor is determined by the Committee within a range of 0% to 200% based on its evaluation of performance versus our strategic objectives. Our strategic objectives cover a range of items critical to both our short- and long-term success. We prioritize excellence in our operational execution, product development and pipeline growth, our employees, key strategic initiatives that enable our continued growth, and performance against our environmental, social and governance objectives. Not all strategic goals are measured against quantitative performance criteria because some goals are qualitative. The Committee considers both quantitative and qualitative results and applies discretion when evaluating performance and determining the payout factor.

  38. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | 2022 Strategic Performance |

  39. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    In February 2022, the Committee approved strategic goals aligned with long-term, sustainable value creation. Based on its evaluation of our performance against our strategic goals, the Committee determined a payout factor of 130.0% of target appropriately recognized both the successes and disappointments we experienced during 2022. The Committee’s assessment of our strategic goals and results is shown in the following table.

  40. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | 2022 Strategic Goals | 2022 Assessment Highlights | | | | Critical Business Objectives | • | We performed strongly against our product pipeline value and innovation platform goals. | | | | • | We focused on convergence opportunities to meet our Interventional Oncology goals. | | | | • | We increased our operations and capabilities as a digital organization, optimizing talent solutions and launching an open-source learning community. | | | | • | We successfully accelerated business outcomes through data science, intelligent automation, improving enterprise programs and harnessing eCommerce potential. | | | | • | We partially met our enterprise technology goals, leveraging digital technology to accelerate our enterprise priorities. We also continued to modernize our technology ecosystem, expand our cybersecurity foundation, enhance our network performance, and diversify and increase our cloud adoptions. | | | | • | We exceeded our milestones in executing the separation of our Consumer Health business. We are on track to reach all deliverables related to the management model and financial and operational readiness. | | | Environmental, Social & Governance | • | We met our quality and compliance objectives, closing audit remediation gaps and reducing the number of health authority actions. | | | | • | We achieved all our key safety goals. | | | | • | We made substantial progress against our human capital management goals, including enhancing our talent pipeline and succession planning as well as the retention of Executive Committee and segment leaders. | | | | • | We partially met our diversity, equity and inclusion goals. We met key global representation levels for female VPs, as well as U.S. Black and Hispanic directors. We partially met our goal to increase representation for U.S. Black and Hispanic VPs. | | | | • | We achieved key milestones on plastics and renewable electricity initiatives. | | | Enterprise Strategic Payout Factor | | | 130.0% |

  41. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | | 2023 Proxy Statement | 65 |

  42. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | 2022 Annual Incentives |

  43. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    The 2022 annual incentive payouts for our CEO and other named executive officers were based 70% on financial goals and 30% on strategic goals. Messrs. Duato and Wolk were measured at the enterprise level. Financial goals for Ms. Taubert, Ms. McEvoy and Mr. Mongon were weighted 75% for Pharmaceutical, MedTech, and Consumer Health, respectively, and 25% on enterprise performance. Furthermore, their strategic goals were aligned with the performance of their respective segments. Our financial goals are evaluated against identified threshold, target, and maximum levels of performance. Our strategic payout factors are determined by the Committee, in its sole discretion, based on its evaluation of performance versus our strategic goals. In addition, the Committee may adjust individual awards on an exception basis within a range of 0x to 1.2x (subject to the 200% of target maximum). The Committee did not adjust any individual 2022 annual incentive payouts on an exception basis. The payouts can range from 0% to 200% of the target award as illustrated below.

  44. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | Target AwardX | Payout Factor (70% Financial / 30% Strategic) | = | Payout Range (0% to 200% of Target) |

  45. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | Summary of Named Executive Officer Annual Incentive Payouts |

  46. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    The final payout factor for Messrs. Duato and Wolk is shown in the table below.

  47. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | | Weight | 2022 Payout Factors | Weighted Payout | | Enterprise Financial | 70.0% | 80.7% | 56.5% | | Enterprise Strategic | 30.0% | 130.0% | 39.0% | | Calculated Enterprise Payout Factor | | | 95.5% | | Discretionary Reduction | | | (4.5%) | | Enterprise Payout Factor | | | 91.0% |

  48. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    The Committee used its discretion to reduce the enterprise and Pharmaceutical segment annual incentive payouts for the appropriate named executive officers by 4.5 and 4.9 percentage points, respectively, to 91.0% to align payouts more closely with those of the other segments. The MedTech segment’s annual incentive payout factor was 69.0% and the Consumer Health segment’s was 86.3%. .

  49. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | 66 | 2023 Proxy Statement | |

  50. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | Our Annual Incentive Goal Setting Process |

  51. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    Each fall, we undertake a rigorous planning process to develop our goals for the coming year. Our financial goals are used to develop the estimates that we provide to the investment community, are aligned with our long-term strategic plan and promote long-term, sustainable value creation. We use the following approach in setting our financial targets:

  52. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | l | Operational Sales: Align with our strategic objective to exceed market growth using the breadth of our portfolio | | l | Adjusted Operational EPS: Consider our strategic plan, financial principles, competitive position and investment strategies | | l | Free Cash Flow: Target specific levels of productivity and adjust for significant events as needed |

  53. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    We set our 2022 operational sales growth goal considering:

  54. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | l | Continuing to drive innovation and market-leading sales growth in Pharmaceutical, continued medical devices market recovery and improved market performance enabled by maximizing the value of recently launched products in MedTech and competitive growth in our Consumer Health segment |

  55. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    We set our 2022 adjusted operational EPS growth goal considering:

  56. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | l | The planned 2022 operational sales items noted above and our financial principles |

  57. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    We set our 2022 Free Cash Flow goal considering:

  58. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | l | Our productivity in generating free cash flow from net income | | l | Adjustments for significant events |

  59. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | | 2023 Proxy Statement | 67 |

  60. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | Details on Non-GAAP Performance Measures | | | | | | • | Operational Sales Growth: Operational sales growth is the sales change due to changes in volume and price, excluding COVID-19 vaccine sales and the effect of currency translation. Any unbudgeted acquisition or divestiture, as well as any accounting change that would impact sales by more than 0.5% would be excluded. The following is a reconciliation of operational sales to reported sales (the most directly comparable GAAP measure). | | | | | | | | | ($ millions) | | | | | 2022 Reported Sales | $94,943 | | | | | COVID-19 Vaccine Sales | (2,179) | | | | | Currency Translation | 4,264 | | | | | 2022 Operational Sales | $97,028 | | • | Free Cash Flow: Free Cash Flow is the net cash from operating activities less additions to property, plant and equipment. Any unbudgeted significant acquisition, divestiture, change in accounting rule, change in tax laws, and special item and intangible amortization expense would be excluded if it impacted adjusted operational EPS by more than 1%. For 2022 annual incentive purposes, we adjusted enterprise Free Cash Flow downward approximately $4.7 billion to remove the impact of budgeted litigation-related payments and budgeted tax matter payments associated with the Consumer Health separation that did not occur in 2022. Adjustments were also made for significant currency fluctuations above normal levels and other items. The figures are rounded for display purposes. | | | | | | | | | $(millions) | | | | | Cash flow from operating activities | $21,194 | | | | | Additions to Property, Plant and Equipment | (4,009) | | | | | Free Cash Flow | 17,185 | | | | | Budgeted litigation-related payments | (2,531) | | | | | Budgeted tax matter payments | (2,151) | | | | | Currency Translation | 1,265 | | | | | Other adjustments | 364 | | | | | Adjusted Free Cash Flow | 14,132 | | • | Adjusted Operational EPS Growth: Adjusted EPS and adjusted operational EPS are non-GAAP financial measures. | | | | | | | • | See Exhibit 99.1 to the Company’s Current Report on Form 8-K dated January 24, 2023 and Reconciliation of Non-GAAP Financial Measures in our 2022 Annual Report included in our proxy materials for a breakout of special items and intangible amortization expense. | | | | | • | Adjusted operational EPS growth also excludes the effect of currency translation. Any unbudgeted significant acquisition, divestiture, change in accounting rule, change in tax laws and share repurchases would be excluded if it impacted adjusted operational EPS by more than 1%. | | | | | • | Below is a reconciliation of diluted EPS (the most directly comparable GAAP measure) to adjusted EPS and adjusted operational EPS. | | | | | | | 2022 $ per share | | | | | Diluted EPS as Reported | $6.73 | | | | | Special Items and Intangible Amortization Expense | 3.42 | | | | | Adjusted EPS | 10.15 | | | | | Currency Translation | 0.55 | | | | | Adjusted Operational EPS | $10.70 |

  61. Performance against our Enterprise Long-Term Strategic Goals (30% weight)

    | 68 | 2023 Proxy Statement | |

  62. 2020-2022 Performance Share Unit (PSU) Payout

    2020-2022 Performance Share Unit (PSU) Payout

  63. 2020-2022 Performance Share Unit (PSU) Payout

    | 2020-2022 PSU Performance versus Goals and Payout as a Percent of Target |

  64. 2020-2022 Performance Share Unit (PSU) Payout

    Due to the impact of COVID-19, our 2020-2022 adjusted operational EPS performance fell below target. However, our 2020-2022 TSR compound annual growth rate performed above target. Our 2020-2022 Performance Share Units paid out at 100.0% of target as shown in the table below. If performance falls between threshold and target or between target and maximum, we determine the percentage of target earned using interpolation. If performance is below threshold for a goal, the percentage of target earned for that goal is 0%. If TSR is negative, the percentage of target earned based on TSR performance would be capped at 100%.

  65. 2020-2022 Performance Share Unit (PSU) Payout

    | PSU Measure | Weight | Threshold (50% Payout) | Target (100% Payout) | Maximum (200% Payout) | Actual | Calculated Payout | Weighted Payout | | 2020-2022 Cumulative Adjusted Operational EPS | 1/2 | $26.23 | $29.14 | $32.05 | $28.15 | 83.0% | 41.5% | | 2020-2022 Relative TSR (CAGR) | 1/2 | 10% below Composite | Equal to Composite | 10% above Composite | 1.7 points | 117.0% | 58.5% | | PSU Payout Factor | | | | | | | 100.0% |

  66. 2020-2022 Performance Share Unit (PSU) Payout

    Note: Cumulative adjusted operational EPS is a non-GAAP measure. See page 71 for details. Sum of individual components may not reflect total payout factor due to rounding.

  67. 2020-2022 Performance Share Unit (PSU) Payout

    | | 2023 Proxy Statement | 69 |

  68. 2020-2022 Performance Share Unit (PSU) Payout

    | Our PSU Goal Setting Process |

  69. 2020-2022 Performance Share Unit (PSU) Payout

    Our PSU goals are based on our long-term strategic plan, promote long-term, sustainable value creation, and take into account our product portfolio and pipeline, anticipated healthcare market growth and other external factors, including the competitive landscape. Cumulative Adjusted Operational EPS: The EPS goal is set based on:

  70. 2020-2022 Performance Share Unit (PSU) Payout

    | l | The operational EPS guidance for the first year, which is provided to the investment community | | l | Sales and EPS targets included in our strategic plan for the second and third years of the performance period | | l | Analysts’ expectations for the Company and the Competitor Composite Peer Group | | l | An EPS growth to sales growth multiple aligned with a long-term goal of growing net income faster than sales |

  71. 2020-2022 Performance Share Unit (PSU) Payout

    Relative Total Shareholder Return (TSR): The three-year relative TSR goal is set to meet the performance of our Competitor Composite Peer Group, which undergoes annual review. See page 84 for more information on our Competitor Composite Peer Group.

  72. 2020-2022 Performance Share Unit (PSU) Payout

    | 70 | 2023 Proxy Statement | |

  73. 2020-2022 Performance Share Unit (PSU) Payout

    | Details on Non-GAAP PSU Performance Measures | | | | | 2020-2022 Cumulative Adjusted Operational EPS Performance: The following is a reconciliation of 2020-2022 cumulative reported EPS to cumulative adjusted operational EPS: | | | | | $ | | | Reported EPS | $20.05 | | | Special Items and Intangible Amortization Expense | 7.93 | | | Adjusted EPS | 27.98 | | | Currency Translation | 0.17 | | | Plan Adjustments | 0.00 | | | Adjusted Operational EPS | $28.15 | | | See Exhibit 99.1 to the Company’s Current Report on Form 8-K dated January 24, 2023 and Reconciliation of Non-GAAP Financial Measures in our 2022 Annual Report included in our proxy materials for a breakout of special items and intangible amortization expense. Adjusted operational EPS excludes the impact of special items and intangible amortization expense. Any unbudgeted significant acquisition, divestiture, change in accounting rule, change in tax laws and share repurchases would be excluded if it impacted adjusted operational EPS by more than 1% in that year or the following year. There were no “plan adjustments” for the 2020-2022 PSU performance period. | | | | 2020-2022 Relative TSR Performance (calculated using trailing 20-day average closing stock prices): | | | | TSR from January 1, 2020 to December 31, 2022 | % | | | Johnson & Johnson | 10.0% | | | Competitor Composite Peer Group | 8.3% | | | Relative TSR Performance (Johnson & Johnson minus Competitor Composite) | 1.7% points |

  74. 2020-2022 Performance Share Unit (PSU) Payout

    | | 2023 Proxy Statement | 71 |

  75. CEO Performance and Compensation Decisions

    | l | Improved our long-term financial outlook with record-level operational investments in R&D and product innovation to expand our product pipeline | | l | Performed strongly on our quality and compliance objectives, closing audit remediation gaps and reducing the number of health authority actions | | l | Drove our progress against our ESG commitments, including our environmental, diversity and engagement initiatives | | l | Led our focus on data science, intelligent automation and cybersecurity | | l | Exceeded our milestones in executing the separation of our Consumer Health business. This process will allow both organizations to focus on their respective markets and achieve future growth |

  76. Compensation Decisions for 2022 Performance

    | l | Annual incentive payout for the prior year’s performance, | | l | Long-term incentives granted in the first quarter of the year based on the prior-year's performance, and | | l | Salary rate for the upcoming year. |

  77. Compensation Decisions for 2022 Performance

    | A | B | C | D | E | | | Cash | | Equity | | | Name | Salary Earned ($) | Annual Incentive ($) | Long-Term Incentive ($) | Total Direct Compensation ($) | | J. Duato | $1,490,962 | $2,390,000 | $15,990,000 | $19,870,962 | | J. Wolk | 1,008,462 | 1,160,000 | 8,200,000 | 10,368,462 | | J. Taubert | 1,008,462 | 928,000 | 6,000,000 | 7,936,462 | | A. McEvoy | 984,615 | 690,000 | 5,690,000 | 7,364,615 | | T. Mongon | 917,308 | 798,000 | 5,250,000 | 6,965,308 |

  78. Annual Incentive (Column C)

    Annual Incentive (Column C) The Board and the Committee approved 2022 annual incentives on February 13, 2023, at 91.0% of target for the enterprise-level named executive officers, 91.0% of target for Ms. Taubert, 69.0% of target for Ms. McEvoy and 86.3% of target for Mr. Mongon, as summarized under 2022 Annual Incentive Goals and Performance on pages 64 through 68. See the 2022 Grants of Plan-Based Awards table on page 99 for the target amounts.

  79. Long-Term Incentive Awards (for 2022 performance) (Column D)

    Long-Term Incentive Awards (for 2022 performance) (Column D) The Board and the Committee approved long-term incentive awards on February 13, 2023 (ranging from 129.7% to 160.8% of target) to the continuing named executive officers based on their 2022 performance, impact on the Company’s long-term results, competitive market data and long-term potential within the organization. The Board and the Committee recognized the named executive officers’ contributions in 2022 in executing the Company’s key strategic objectives and fulfilling Our Credo responsibilities to patients, doctors, nurses and employees. The Board and Committee considered the following in their decisions:

  80. Long-Term Incentive Awards (for 2022 performance) (Column D)

    | 74 | 2023 Proxy Statement | |

  81. Long-Term Incentive Awards (for 2022 performance) (Column D)

    | l | These awards will further align executive and shareholder interests. | | l | These awards help secure our current executive leadership, whose contributions are critical to our continued growth and success. | | l | Our business performance was strong, despite significant macroeconomic headwinds. |

  82. Long-Term Incentive Awards (for 2022 performance) (Column D)

    In the table below, we show the total long-term incentive awards granted; the weighting of performance share units, options and restricted share units; and the individual award values.

  83. Long-Term Incentive Awards (for 2022 performance) (Column D)

    | Name | PSUs ($) | Options ($) | RSUs ($) | Total Long-Term Incentives ($) | | Award Weight | 60% | 30% | 10% | 100% | | J. Duato | $9,594,000 | $4,797,000 | $1,599,000 | $15,990,000 | | J. Wolk | 4,920,000 | 2,460,000 | 820,000 | 8,200,000 | | J. Taubert | 3,600,000 | 1,800,000 | 600,000 | 6,000,000 | | A. McEvoy | 3,414,000 | 1,707,000 | 569,000 | 5,690,000 | | T. Mongon | 3,150,000 | 1,575,000 | 525,000 | 5,250,000 |

  84. Long-Term Incentive Awards (for 2022 performance) (Column D)

    In the table below, we show the number of shares of PSUs, options and RSUs granted. We determine the number of units or options for each type of long-term incentive by dividing the dollar amount by the value per unit (or option) and rounding to the nearest whole unit or option. See the table on page 76 for details on the value of our 2023 long-term incentive awards.

  85. Long-Term Incentive Awards (for 2022 performance) (Column D)

    | Name | PSUs (#) | Options (#) | RSUs (#) | | Value Per Unit or Option | $149.189 | $27.849 | $153.622 | | J. Duato | 64,308 | 172,250 | 10,409 | | J. Wolk | 32,978 | 88,334 | 5,338 | | J. Taubert | 24,130 | 64,634 | 3,906 | | A. McEvoy | 22,884 | 61,295 | 3,704 | | T. Mongon | 21,114 | 56,555 | 3,417 |

  86. Long-Term Incentive Awards (for 2022 performance) (Column D)

    | 2023 Salary Rates |

  87. Long-Term Incentive Awards (for 2022 performance) (Column D)

    We do not guarantee annual salary increases and they are not automatic. The Board and the Committee reviewed performance, market data, responsibilities and experience in determining the base salary rates for our named executive officers. On May 11, 2022, we announced Thibaut Mongon as the CEO designate of the future new Consumer Health Company. The leadership transition will take place upon completion of the planned separation of our Consumer Health business, which is expected to occur in 2023. The following table shows the 2023 annual base salary rate for each of the continuing named executive officers. The annual base salary rates are all effective as of February 20, 2023, with the exception of Mr. Mongon, whose annual base salary rate is effective as of January 1, 2023 and reflects his role as CEO designate of the new Consumer Health Company.

  88. Long-Term Incentive Awards (for 2022 performance) (Column D)

    | Name | 2022 Base Salary Rate ($) | 2023 Base Salary Rate ($) | | J. Duato | $1,500,000 | $1,600,000 | | J. Wolk | 1,020,000 | 1,170,000 | | J. Taubert | 1,020,000 | 1,150,000 | | A. McEvoy | 1,000,000 | 1,070,000 | | T. Mongon | 925,000 | 1,250,000 |

  89. Long-Term Incentive Awards (for 2022 performance) (Column D)

    | | 2023 Proxy Statement | 75 |

  90. Long-Term Incentive Awards (for 2022 performance) (Column D)

    | Details on 2023 Long-Term Incentive Value per Unit or Option | | | | | We used $149.189 per unit to determine the number of PSUs, which equals the value of a PSU assuming 100% of target performance is achieved. PSUs vest on the third anniversary of the grant date. | | | | We used $153.622 per unit to determine the number of RSUs. RSUs vest one third per year on each of the first, second and third anniversaries of the grant date. | | | | We used the grant date values to determine the number of the PSUs and RSUs based on the closing price of our common stock on the New York Stock Exchange (NYSE) on the grant date discounted by the expected dividend yield because dividends are not paid on RSUs prior to vesting. | | | | We valued the options using the Black-Scholes model with the assumptions below. | | | | We used the same grant date, common stock fair market value and dividend yield assumptions to calculate the values of the options and RSUs shown in the table below. | | | | Assumptions used for PSU, RSU and Option Calculations | | | | Grant Date | 2/13/2023 | | | Common Stock Fair Market Value (closing price on the NYSE) | $162.75 | | | Dividend yield | 2.90% | | | Value per PSU | $149.189 | | | Value per RSU | $153.622 | | | 2023 Option Value | | | | Exercise Price | $162.75 | | | Risk Free Rate (determined based on U.S. treasury rate of seven years) | 3.74% | | | Expected Volatility (calculated using blended historical average volatility and implied volatility on at-the-money, 2-year, traded options) | 17.69% | | | Expected Life in years (calculated based on historical data) | 7.00 | | | Value per Option | $27.849 |

  91. Long-Term Incentive Awards (for 2022 performance) (Column D)

    | 76 | 2023 Proxy Statement | |

  92. Key Features of our Executive Compensation Program

    | What We Do | | What We Don't Do | | | ü | Align CEO pay with Company performance | û | No automatic or guaranteed annual salary increases | | ü | Align the majority of named executive officer pay with shareholders through long-term incentives | û | No guaranteed annual or long-term incentive awards | | ü | Balance short-term and long-term incentives | û | No above-median targeting of executive compensation | | ü | Cap incentive awards | û | No automatic single trigger equity acceleration | | ü | Require executives to own significant amounts of Company stock | û | No tax gross-ups (unless they are provided pursuant to our standard relocation practices) | | ü | Employ a compensation recoupment policy applicable to our named executive officers | û | No option repricing without shareholder approval | | ü | Actively engage with our shareholders | û | No hedging, pledging or short selling of Company stock | | ü | Engage an independent compensation consultant reporting directly to the Committee | û | No long-term incentive backdating | | ü | Hold advisory vote to approve named executive officer compensation annually | û | No dividend equivalents on unvested long-term incentives |

  93. Key Features of our Executive Compensation Program

    Johnson & Johnson does not have any change-in-control agreements in place for any of the named executive officers. Our 2022 Long-Term Incentive Plan only provides for a change-in-control benefit in the event that outstanding awards granted under the plan are not assumed or substituted by the acquirer in connection with a change-in-control, in which case, the awards will vest and any performance conditions will be deemed to be achieved at the greater of target or actual performance levels as of the date of the change-in-control. If outstanding awards are assumed or substituted, the awards will remain outstanding and will continue to vest following the change-in-control.

  94. Guiding Principles

    | l | Pay for Performance: We tie annual incentive payouts and long-term incentive grants to the performance of our Company, the individual’s segment or function and the individual. | | l | Accountability for Short-Term and Long-Term Performance: We structure performance-based compensation to reward an appropriate balance of short-term and long-term financial and strategic business results, with an emphasis on managing the business for long-term results. The Board is responsible for oversight of risk management (including product development, supply chain and quality risks) as described under Oversight of Our Company beginning on page 30. Our compensation program’s emphasis on long-term value helps to reduce the possibility that our executives make excessively risky business decisions that could maximize short-term results at the expense of long-term value. | | l | Alignment to Shareholders’ Interests: We structure performance-based compensation to align the interests of our named executive officers with the long-term interests of our shareholders. | | l | Competitiveness: We compare our practices against appropriate peer companies that are of similar size and complexity, so we can continue to attract, retain and motivate high-performing executives. |

  95. Base Salary, Annual Incentive and Long-Term Incentives

    Base Salary, Annual Incentive and Long-Term Incentives Below we describe the components of our total direct compensation, how we determine their size and why we pay them.

  96. Base Salary, Annual Incentive and Long-Term Incentives

    | Component | Form | Vesting / Performance Period | How Size is Determined | | | Why We Pay Each Component | | | Base Salary | Cash | Ongoing | l | We base salary rates on: | | l | Recognize job responsibilities | | | | | | l | Competitive data | | | | | | | | l | Scope of responsibilities | | | | | | | | l | Work experience | | | | | | | | l | Time in position | | | | | | | | l | Internal equity | | | | | | | | l | Individual performance | | | | Annual Incentive | Cash | 1 year | l | We set target awards as a percent of salary based on competitive data. | | l | Motivate attainment of our near-term priorities, consistent with our long-term strategic plan | | | | | l | We determine award payouts based on business and individual performance. | | | | | Long-Term Incentives | Equity | 3 years (options: 10-year term) | l | We set target awards as a percent of salary based on competitive data. | | l | Motivate attainment of our long-term goals, TSR and share price growth | | | | | l | We grant long-term incentives based on business and individual performance, contribution and long-term potential. | | l | Retain executives | | | | | l | We determine payouts based on achievement of long-term operational goals, TSR and share price appreciation. | | | |

  97. Base Salary, Annual Incentive and Long-Term Incentives

    | 78 | 2023 Proxy Statement | |

  98. Long-Term Incentives

    Long-Term Incentives Below we describe the forms of long-term incentives we use for our named executive officers, their weighting, performance periods, how the payouts are determined and why we use them.

  99. Long-Term Incentives

    | Long-Term Incentive Form | Mix | Vesting / Performance Period | | How Payouts are Determined | | Why We Use Them | | | Performance Share Units | 60% | l | 0% to 200% vested three years after grant | l | 1/2 Earnings per Share: three-year Cumulative Adjusted Operational EPS | l | Aligns with our long-term objective of growing quality earnings | | | | | | l | 1/2 Relative Total Shareholder Return: three-year Compound Annual Growth Rate versus the Competitor Composite Peer Group | l | Reflects overall TSR outcomes relative to our competitors | | | | | | l | Share price | l | Ties PSU value directly to the share price | | Options | 30% | l | 100% vested 3 years after grant | l | Share price appreciation | l | Motivates share price appreciation over the long-term | | | | l | 10-year term | | | l | Reinforces emphasis on long-term growth aligned with our objectives | | Restricted Share Units | 10% | l | 100% vested 3 years after grant | l | Share price | l | Ties RSU value directly to the share price |

  100. Long-Term Incentives

    Notes:

  101. Long-Term Incentives

    | l | Cumulative adjusted operational EPS is a non-GAAP measure. See page 71 for details. | | l | No dividend equivalents are paid on our PSUs, options or RSUs. | | l | Beginning with the February 13, 2023 grant, options and RSUs will vest one third per year on each of the first, second and third anniversaries of the grant date. |

  102. Long-Term Incentives

    | | 2023 Proxy Statement | 79 |

  103. Long-Term Incentives

    | Long-Term Incentive Vesting and Treatment upon Termination |

  104. Long-Term Incentives

    Our 2022 long-term incentives vest 100% on the third anniversary of the grant date. Beginning with the February 13, 2023 grant, our options and RSUs will vest one third per year on each of the first, second and third anniversaries of the grant date. Our PSUs will continue to vest 100% on the third anniversary of the grant date. In addition, we do not pay out our PSUs until we determine the percent of target PSUs that have been earned based on performance. The treatment of our long-term incentives upon termination varies depending on the termination circumstances, as follows:

  105. Long-Term Incentives

    | Termination | Eligibility | | Eligible Named Executive Officers | Voluntary Termination | | Involuntary Termination Without Cause | Involuntary Termination with Cause | | Death | | Disability | | Qualifying Separation | l | Termination of employment at age 62 or later, or | J. Duato J. Wolk J. Taubert | l | Grants within six months prior to termination would be forfeited. | | l | All vested and unvested equity awards would be forfeited. | l | All equity awards would become vested on the termination date. | | | | l | Termination of employment after attainment of age 55 and at least 10 years of service with at least 5 years of consecutive service immediately before termination of employment | | l | Other equity awards would become vested on their normal vesting dates. | | | | l | Options would remain exercisable for their remaining terms. | | | | | | | l | Options would remain exercisable for their remaining terms. | | | | l | Accelerated PSUs would be paid out at 100% of target with a “top up” at the end of the performance period if the payout exceeds target. | | | Non-Qualifying Separation (age 55-61) | l | Termination of employment after attainment of age 55 but before age 62 and without meeting the service requirements for Qualifying Separation | | l | All unvested equity incentives would be forfeited. | | | | | | | | | | | | l | Vested options would remain exercisable for up to three years. | | | | | | | | Non-Qualifying Separation (Under age 55) | l | Termination of employment before attainment of age 55 | A. McEvoy T. Mongon | l | All unvested equity incentives would be forfeited. | | | | | | | | | | | | l | Vested options would remain exercisable for up to three months. | | | | | | |

  106. Long-Term Incentives

    | Non-Competition and Non-Solicitation |

  107. Long-Term Incentives

    Long-term incentive awards are subject to forfeiture and repayment provisions if an employee violates non-competition or non-solicitation agreements, as follows:

  108. Long-Term Incentives

    | Competition with the Company | | Impact on Long-Term Incentive Awards | | | l | Violating the non-competition provisions of the award agreement during employment or within 18 months of termination and/or | l | Forfeit vested and unvested PSUs, options and RSUs and | | l | Violating any other non-competition or non-solicitation agreement an employee has with the Company. | l | Repay any PSUs or RSUs vested or options exercised within the 12 months prior to the violation. |

  109. Long-Term Incentives

    | 80 | 2023 Proxy Statement | |

  110. Involuntary Termination due to Specified Divestiture or Reduction in Force

    Beginning with the February 13, 2023 long-term incentive award, RSUs and options will no longer be prorated in the event of a Specified Divestiture or Reduction in Force. Long-term incentive awards granted prior to that date will be prorated and vested in the event of a Specified Divestiture or Reduction in Force as described below. In addition, PSU awards will continue to be pro-rated as follows:

  111. Involuntary Termination due to Specified Divestiture or Reduction in Force

    | l | Proration: Awards would be prorated in proportion to the time worked during the vesting period. | | l | Vesting: PSU and RSU awards would become available on their normal vesting dates. Option vesting would be accelerated as of the date of termination and the options would remain exercisable for up to three months. | | l | Coordination with Qualifying Separations: If an employee’s termination is also a Qualifying Separation, any of the employee’s awards that would have been forfeited because they were granted within six months prior to termination would receive the pro-ration and vesting treatment described above. |

  112. Involuntary Termination due to Specified Divestiture or Reduction in Force

    Before each year begins, we set compensation targets to ensure that we can compete for talent and to maintain internal equity among positions with similar responsibilities. We conduct an annual review of publicly available information and executive compensation surveys to determine current pay levels among the Executive Peer Group. The Committee reviews market data to understand how our target pay levels compare to benchmark positions but does not target total compensation to a specific percentile of the Executive Peer Group.

  113. Peer Groups for Pay and Performance

    Peer Groups for Pay and Performance We use two peer groups to help determine executive compensation:

  114. Peer Groups for Pay and Performance

    | l | Executive Peer Group: We use the Executive Peer Group to assess the competitiveness of the compensation of our named executive officers. | | l | Competitor Composite Peer Group: We use the Competitor Composite Peer Group to evaluate the relative performance of our Company. |

  115. Peer Groups for Pay and Performance

    As described below, the two peer groups vary because executive compensation levels and practices are influenced by business complexity and company size. Most of our business competitors are smaller than Johnson & Johnson or even each of our individual businesses.

  116. Peer Groups for Pay and Performance

    | 82 | 2023 Proxy Statement | |

  117. Peer Groups for Pay and Performance

    | Executive Peer Group |

  118. Peer Groups for Pay and Performance

    The Committee compares our executive compensation levels and practices to those of the Executive Peer Group companies. It consists of companies that generally are similar to Johnson & Johnson's size and scope, have executive positions similar to ours and compete with us for executive talent. The Committee reviews the composition of the Executive Peer Group annually. We compare our salaries, annual incentives, long-term incentives, total direct compensation, benefits, perquisites and other compensation to the Executive Peer Group companies. We do not include non-U.S. companies because comparable compensation data for the named executive officers is not available. We also do not include companies in industries whose compensation programs are not comparable to our programs, such as the financial services or oil and gas industries. The following table lists the 2022 Executive Peer Group companies, their business characteristics and Johnson & Johnson’s rankings among these companies. Each company’s figures are for the most recent four fiscal quarters. Market capitalization is as of December 31, 2022. Johnson & Johnson ranks in the top quartile of the peers for revenue, net income and market capitalization. Effective for 2023, The Coca-Cola Company and PepsiCo, Inc. will be removed and Eli Lilly and Company, Gilead Sciences, Inc. and Amgen Inc. will be added.

  119. Peer Groups for Pay and Performance

    | Company (Ticker Symbol) | Revenue ($ millions) | Net Income ($ millions) (1) | Market Cap ($ billions) (2) | Common Industry (3) | Gross Margin (>40%) | EBIT Margin (>10%)(4) | Inter-national Sales (> 33%) | Business Complexity(5) | R&D % of Sales (>or = 5%) | | 3M Company (MMM)(10) | $34,229 | $5,777 | $66 | ü | ü | ü | ü | ü | ü | | Abbott Laboratories (ABT) | 43,653 | 6,933 | 191 | ü | ü | ü | ü | ü | ü | | Abbvie Inc. (ABBV) | 58,054 | 11,836 | 286 | ü | ü | ü | | ü | ü | | AT&T Inc. (T) | 120,741 | (8,524) | 131 | | ü | | | ü | | | The Boeing Company (BA) | 66,608 | (4,935) | 114 | | | | ü | ü | | | Bristol Myers Squibb Company (BMY) | 46,159 | 6,327 | 153 | ü | ü | ü | | ü | ü | | Cisco Systems, Inc. (CSCO)(6)(10) | 53,161 | 11,302 | 196 | | ü | ü | ü | ü | ü | | The Coca-Cola Company (KO)(10) | 43,004 | 9,542 | 275 | | ü | ü | ü | | ND(8) | | General Electric Company (GE) | 76,555 | 225 | 92 | ü | | | ü | ü | | | Intel Corporation (INTC) | 63,054 | 8,017 | 109 | | ü | ü | ü | ü | ü | | Intl Business Machines Corp. (IBM)(10) | 60,530 | 1,639 | 127 | | ü | | ü | ü | ü | | Medtronic plc (MDT)(6) | 30,771 | 4,064 | 103 | ü | ü | ü | ü | ü | ü | | Merck & Co., Inc. (MRK) | 59,283 | 14,519 | 281 | ü | ü | ü | ü | ü | ü | | Microsoft Corporation (MSFT)(7) | 204,094 | 67,449 | 1,788 | | ü | ü | ü | ü | ü | | PepsiCo, Inc. (PEP) | 86,392 | 8,910 | 249 | | ü | ü | ü | ü | | | Pfizer Inc. (PFE) | 100,330 | 31,372 | 288 | ü | ü | ü | ü | ü | ü | | The Procter & Gamble Company (PG)(7)(9) | 80,281 | 14,279 | 359 | ü | ü | ü | ü | ü | | | Raytheon Technologies Corporation (RTX) | 67,074 | 5,197 | 148 | | | ü | | ü | | | Johnson & Johnson (JNJ) | 94,943 | 17,941 | 462 | ü | ü | ü | ü | ü | ü | | Johnson & Johnson's Ranking | 4th | 3rd | 2nd | | | | | | | | Johnson & Johnson's Percentile Rank | 83% | 89% | 94% | | | | | | |

  120. Peer Groups for Pay and Performance

    (1) Net Income reflects Net Income (Loss) attributable to company shareholders. (2) Market Caps are derived from Bloomberg as of December 31, 2022. (3) Common Industry means that the company is in an industry similar to one of Johnson & Johnson’s business segments: Pharmaceuticals, MedTech or Consumer Health. (4) Earnings Before Interest and Tax (EBIT) is calculated as Income Before Tax (IBT) minus Net Interest Expense. (5) Business Complexity means the company is a complex organization with multiple product lines. (6) Used last four calendar quarters ending January 27, 2023 for Medtronic plc and January 28, 2023 for Cisco Systems, Inc. (7) Used last four calendar quarters ending December 31, 2022 for The Procter & Gamble Company and Microsoft Corporation. (8) ND represents "Not Disclosed" as The Coca-Cola Company does not disclose R&D data. (9) The Procter & Gamble Company's R&D spend and International Sales are based on the fiscal year ended June 30, 2022 as an alternative due to lack of availability at the time of sourcing. (10) International sales estimated for Cisco Systems, Inc., 3M Company, IBM and The Coca-Cola Company, as domestic sales are represented either as "Americas" or "North America."

  121. Peer Groups for Pay and Performance

    | | 2023 Proxy Statement | 83 |

  122. Peer Groups for Pay and Performance

    | Competitor Composite Peer Group |

  123. Peer Groups for Pay and Performance

    The Committee compares overall Company performance to the weighted performance of the Competitor Composite Peer Group companies. For example, when we set the sales goals for our businesses, we compare the sales of our individual businesses to the total sales of their industry competitors. For the TSR component of our PSUs, we weight the TSR within the three business groups by market capitalization and weight the three business groups using our sales mix each year. We include each of the peer companies in only one of the business groups in calculating the Competitor Composite TSR for our PSU program. These companies compete with one or more of our three business segments. We evaluate the peer group on an ongoing basis and update it as necessary. We select the companies based on the following criteria and financial metrics:

  124. Peer Groups for Pay and Performance

    | l | Product relevance | | l | Financial comparison: Sales growth, net income growth and margin, EPS growth and TSR | | l | Global presence | | l | Market leadership | | l | Strength and consistency in financial outlook |

  125. Peer Groups for Pay and Performance

    The following table lists the 2022 Competitor Composite Peer Group companies by business.

  126. Peer Groups for Pay and Performance

    | Pharmaceuticals | | MedTech | | Consumer Health | | | l | AbbVie Inc. | l | Alcon, Inc. | l | Beiersdorf AG | | l | Amgen Inc. | l | Boston Scientific Corporation | l | Bayer AG** | | l | AstraZeneca PLC | l | The Cooper Companies, Inc | l | Colgate-Palmolive Company | | l | Bristol-Myers Squibb Company | l | Intuitive Surgical, Inc. | l | GlaxoSmithKline plc** | | l | Eli Lilly and Company | l | Medtronic plc | l | L'Oréal Company | | l | GlaxoSmithKline plc | l | Smith & Nephew plc | l | The Procter & Gamble Company | | l | Merck & Co., Inc. | l | Stryker Corporation | | | | l | Novartis AG | l | Zimmer Biomet Holdings, Inc. | l | Reckitt Benckiser Group plc | | l | Pfizer Inc. | | | l | Sanofi** | | l | Roche Holding Ltd* | | | l | Unilever PLC | | l | Sanofi | | | | | | * | Pharm Sales, SG&A, R&D and Operating Profit only | | | | | | ** | OTC Sales only | | | | |

  127. Peer Groups for Pay and Performance

    For 2023, the MedTech and Consumer Health Competitor Composite groups were updated to more accurately reflect changes in their business mix, the evolution of the competitive landscape and newly public companies. Bausch & Lomb Inc. was added to the MedTech group. Haleon plc was added and GlaxoSmithKline plc was removed from the Consumer Health Group.

  128. Peer Groups for Pay and Performance

    | 84 | 2023 Proxy Statement | |

  129. Governance of Executive Compensation

    | Independence of Compensation Consultant |

  130. Additional Information Concerning Executive Compensation

    Our Severance Pay Plan provides benefits to certain full-time U.S. employees who are involuntarily terminated. We provide two weeks base salary for each year of service, with guaranteed minimums based on an employee’s level. The minimum for our named executive officers is 52 weeks of base salary. We pay severance according to our normal payroll cycle. We do not pay severance as a lump-sum payment. We do not have employment arrangements or agreements with any of our named executive officers.

  131. Additional Information Concerning Executive Compensation

    | Name | Stock Ownership Guideline as a Multiple of Base Salary | 2022 Compliance with Stock Ownership Guidelines? | Ownership Threshold Met?(1) | | J. Duato | 12x | Yes | Yes | | J. Wolk | 6x | Yes | Yes | | J. Taubert | 6x | Yes | Yes | | A. McEvoy | 6x | Yes | Yes | | T. Mongon | 6x | Yes | Yes | | (1) Executive officers have five years after first becoming subject to the guidelines to achieve the required ownership thresholds. | | | |

  132. Additional Information Concerning Executive Compensation

    We do not count shares underlying options or unearned PSUs as owned shares for these guidelines. A named executive officer cannot sell the after-tax shares received from long-term incentives until his or her ownership threshold is met. The Nominating & Corporate Governance Committee monitors compliance with these guidelines on an annual basis. Our Policy Against Pledging, Hedging and Short Selling of Company Stock prohibits directors and executive officers from pledging, entering into hedging arrangements, short selling or transacting in derivative instruments linked to the performance of the Company’s stock.

  133. Additional Information Concerning Executive Compensation

    | l | 2022 PSU and RSU awards included in the Stock Awards column | | l | The 2022 option award included in the Option Awards column |

  134. Reconciliation of our CEO's 2022 Total Direct Compensation to the 2022 Summary Compensation Table

    | l | Long-Term Incentive (LTI) Timing and Accounting Differences: | | | | l | LTI Timing Difference: We consider an executive's LTI award granted based on a year's performance to be part of his or her total direct compensation for that year along with his or her salary earned during that year and annual incentive earned for that year's performance. In contrast, the Summary Compensation Table total includes LTI granted during the year – not the LTI granted based on that year's performance. Since we vary the size of our LTI awards based on performance in the prior year, this timing difference results in differences that obscure the decisions of the Committee to align pay with performance for a given year. For example, the LTI awards granted on February 13, 2023 based on 2022 performance are included in our named executive officers' 2022 total direct compensation. However, the Summary Compensation Table's 2022 totals include amounts granted in 2022 (based on 2021 performance). | | | l | LTI Accounting Difference: The per-unit value used to determine the number of PSUs granted assumes 100% of target performance is achieved. This PSU unit value is lower than the value included in the Summary Compensation Table. The difference is due to the TSR-based part of the PSUs being valued at more than 100% of target performance according to U.S. accounting rules. | | l | Change in Pension Present Value: The pension is only paid after retirement and we do not consider it to be part of total direct compensation for any given year. In contrast, the Summary Compensation Table total includes positive changes in the present value of an executive's pension benefit during the year. On pages 92 and 96 we show the breakout of the impacts of service, pay and age and changes in assumptions on our named executive officers' changes in pension values. The "noise" created by changes in assumptions introduces significant year-over-year volatility to our Summary Compensation Table totals and does not reflect decisions on compensation by the Committee. | | | l | Other: We do not include amounts related to our legacy cash-based long-term incentives and benefits and perquisites in total direct compensation for a year. However, these amounts are included in the Summary Compensation Table total as follows: | | | | l | Legacy cash-based long-term incentives: Dividend equivalent payments on, and the growth in value above a reference rate of, our legacy cash-based long-term incentive plans (included in Columns F and G). We stopped granting cash-based long-term incentives in 2012. | | | l | Benefits and perquisites: Perquisites and other personal benefits, Company contributions to our 401(k) and Excess Savings Plans and insurance premiums (included in Column H) |

  135. Reconciliation of our CEO's 2022 Total Direct Compensation to the 2022 Summary Compensation Table

    | CEO Compensation: LTI Timing & Accounting Differences | 2020 | 2021 | 2022 | | LTI Value included in Total Direct Compensation | $7,980,000 | $7,730,000 | $15,990,000 | | Value of Timing Differences | (670,000) | 250,000 | (8,260,000) | | Value of Accounting Differences | 1,681,093 | 1,415,279 | 529,788 | | LTI Value included in Summary Compensation Table | 8,991,093 | 9,395,279 | 8,259,788 |

  136. Reconciliation of our CEO's 2022 Total Direct Compensation to the 2022 Summary Compensation Table

    | l | Service: Each year of additional year of service increases the pension benefits. | | l | Five-Year Average Pay: Increases in an executive's five-year average pay increase the pension benefits. | | l | Age: Each year an executive is one year closer to retirement results in an increase in the present value solely due to the passage of time. |

  137. 2022 Summary Compensation Table

    2022 Summary Compensation Table In the table below, we show the compensation of our Chief Executive Officer, Chief Financial Officer and the three other most highly compensated executive officers for 2022. We show the compensation of executive officers listed in the table below for 2021 and 2020 if they were also named in the 2022 and 2021 Proxy Statements. For a complete understanding of the table, please read the descriptions of each column that follow the table.

  138. 2022 Summary Compensation Table

    | A | B | C | D | E | F | G | H | I | | Name and Principal Position | Year | Salary ($) | Stock Awards ($) | Option Awards ($) | Non-Equity Incentive Plan Compensation ($) | Change in Pension Value and Non-Qualified Deferred Compensation Earnings ($) | All Other Compensation ($) | Total ($) | | J. Duato Chairman/CEO | 2022 | $1,490,962 | $5,940,829 | $2,318,959 | $3,079,750 | $0 | $268,987 | $13,099,487 | | | 2021 | 1,030,000 | 7,001,281 | 2,393,998 | 2,319,450 | 875,767 | 184,796 | 13,805,292 | | | 2020 | 1,021,538 | 6,798,093 | 2,193,000 | 1,820,403 | 3,746,000 | 45,969 | 15,625,003 | | J. Wolk EVP, CFO | 2022 | 1,008,462 | 4,718,897 | 1,841,952 | 1,177,800 | 0 | 75,971 | 8,823,082 | | | 2021 | 938,077 | 4,877,538 | 1,688,997 | 1,560,863 | 1,809,897 | 78,243 | 10,953,615 | | | 2020 | 885,385 | 4,163,841 | 1,448,997 | 1,044,179 | 2,607,000 | 46,636 | 10,196,038 | | J. Taubert EVP, Worldwide Chair Pharmaceuticals | 2022 | 1,008,462 | 4,764,921 | 1,859,958 | 1,094,875 | 0 | 53,316 | 8,781,532 | | | 2021 | 938,077 | 4,947,245 | 1,713,005 | 1,510,314 | 1,067,411 | 49,707 | 10,225,759 | | | 2020 | 884,615 | 4,468,928 | 1,499,997 | 990,058 | 1,642,000 | 46,871 | 9,532,469 | | A. McEvoy EVP, Worldwide Chair MedTech | 2022 | 984,615 | 3,935,021 | 1,535,967 | 890,250 | 0 | 44,308 | 7,390,161 | | T. Mongon EVP, Worldwide Chair Consumer Health | 2022 | 917,308 | 3,681,233 | 1,436,969 | 798,000 | 62,000 | 196,900 | 7,092,410 |

  139. 2022 Summary Compensation Table

    Note: EVP means Executive Vice President. Mr. Duato assumed the role of CEO on January 3, 2022 and the additional position of Chairman of the Board on January 2, 2023. Mr. Gorsky retired as Executive Chairman at the end of fiscal year 2022. His 2022 compensation is included in the Director Compensation section beginning on page 53.

  140. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G) Column G includes the increase in the present value of the accrued pension benefit and the above-reference-rate non-qualified deferred compensation earnings. The table below shows the change in pension values and above-reference-rate amounts for vested CLCs.

  141. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    | Change in Pension Value and Non-Qualified Deferred Compensation Earnings | | | | | | Name | Fiscal Year | Change in Pension Value ($) | Above Reference-Rate Calculation for Vested CLCs ($) | Total ($) | | J. Duato | 2022 | $0 | $0 | $0 | | | 2021 | 841,000 | 34,767 | 875,767 | | | 2020 | 3,746,000 | 0 | 3,746,000 | | J. Wolk | 2022 | 0 | 0 | 0 | | | 2021 | 1,809,000 | 897 | 1,809,897 | | | 2020 | 2,607,000 | 0 | 2,607,000 | | J. Taubert | 2022 | 0 | 0 | 0 | | | 2021 | 1,059,000 | 8,411 | 1,067,411 | | | 2020 | 1,642,000 | 0 | 1,642,000 | | A. McEvoy | 2022 | 0 | 0 | 0 | | T. Mongon | 2022 | 62,000 | 0 | 62,000 |

  142. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    | 96 | 2023 Proxy Statement | |

  143. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    The change in pension present value is not a current cash payment. The pensions are only paid after retirement. See 2022 Pension Benefits on page 106 for details on the pension. See Note 10 to the Consolidated Financial Statements of the 2022 Form 10-K for details on the discount rate.

  144. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    | l | Impact of Service, Pay and Age: The following factors increased the present values: | | | | l | Service: An additional year of completed service was included in the calculation of benefits. | | | l | Five-Year Average Pay: The five-year average pay increased since the previous fiscal year-end. | | | l | Age: Each executive is one year closer to the age when we assume the pension payments will begin. | | l | Impact of Changes in Assumptions: The change in present value is highly sensitive to changes in mortality and interest rate assumptions which can increase or decrease the values. The following table details the changes in actuarial assumptions and their net effect on the change in pension value. | |

  145. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    | Effect of Change in Actuarial Assumptions on Pension Present Value | | | | | Year | Mortality Table | Discount Rate | Net Effect of Changes on Pension Present Value | | 2022 | PRI-2012 Table, Generational Mortality Projection with Scale MMP-2021 | 5.42% | Decrease | | 2021 | PRI-2012 Table, Generational Mortality Projection with Scale MMP-2021 | 2.89% | Decrease | | 2020 | PRI-2012 Table, Generational Mortality Projection with Scale MMP-2019 | 2.55% | Increase | | 2019 | PRI-2012 Table, Generational Mortality Projection with Scale MMP-2019 | 3.46% | N/A |

  146. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    In the table below, we show the 2020-2022 changes in pension value and the impacts of: (i) service, pay and age; and (ii) changes in assumptions. Negative figures are not included in the Summary Compensation Table (according to SEC rules).

  147. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    | Change in Pension Value | | | | | | | Name | Year | Impact of Service, Pay, and Age ($) | Impact of Changes in Assumptions ($) | Total Change in Pension Value ($) | Amount Reported in Summary Compensation Table ($) | | J. Duato | 2022 | $4,079,000 | $(6,245,000) | $(2,166,000) | $0 | | | 2021 | 1,812,000 | (971,000) | 841,000 | 841,000 | | | 2020 | 1,341,000 | 2,405,000 | 3,746,000 | 3,746,000 | | J. Wolk | 2022 | 2,249,000 | (3,651,000) | (1,402,000) | 0 | | | 2021 | 2,365,000 | (556,000) | 1,809,000 | 1,809,000 | | | 2020 | 1,508,000 | 1,099,000 | 2,607,000 | 2,607,000 | | J. Taubert | 2022 | 1,218,000 | (2,376,000) | (1,158,000) | 0 | | | 2021 | 1,430,000 | (371,000) | 1,059,000 | 1,059,000 | | | 2020 | 814,000 | 828,000 | 1,642,000 | 1,642,000 | | A. McEvoy | 2022 | 1,020,000 | (3,617,000) | (2,597,000) | 0 | | T. Mongon | 2022 | 215,000 | (153,000) | 62,000 | 62,000 |

  148. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    | | 2023 Proxy Statement | 97 |

  149. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    | Above-Reference-Rate Non-Qualified Deferred Compensation Earnings |

  150. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    Any above-reference-rate returns on vested CLCs are deferred and not paid in the current year.

  151. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    | l | The change in the values of the CLCs depends on our long-term operational performance. | | l | We use 120% of the December applicable federal long-term interest rate (AFR) as the reference rate. | | l | Negative figures are not included in the Summary Compensation Table (according to SEC rules). |

  152. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    The following table details the calculation of the above-reference-rate returns on CLCs.

  153. Change in Pension Value and Non-Qualified Deferred Compensation Earnings (Column G)

    | Above-Reference-Rate Return | CLC | | Beginning of Year Unit Value | $51.62 | | End of Year Unit Value | $52.90 | | Change in Unit Value ($) | $1.28 | | Change in Unit Value (%) | 2.48% | | Reference-Rate | 5.22% | | Above-Reference-Rate Return | (2.74)% | | Above Reference-Rate Return Included in the Summary Compensation Table | 0.00% |

  154. 2022 Grants of Plan-Based Awards

    2022 Grants of Plan-Based Awards In the table below, we show the potential ranges of the 2022 annual incentives and the PSUs, RSUs and options granted in 2022. We include the grant date fair values of the stock awards and option awards in columns D and E of the Summary Compensation Table on page 93. For a complete understanding of the table, please read the descriptions of each column that follow the table.

  155. 2022 Grants of Plan-Based Awards

    | A | B | C | D | E | F | G | H | I | J | K | L | M | N | | Name | Award | Grant Date | Estimated Future Payouts Under Non-Equity Incentive Plan Awards (Annual Incentive) | | | Estimated Future Payouts Under Equity Incentive Plan Awards (Performance Share Units) | | | 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 ($/sh) | Closing Market Price on the Grant Date ($) | Grant Date Fair Value of Stock and Option Awards ($) | | | | | Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | | | | | | | J. Duato | Annual Incentive | | $0 | $2,625,000 | $5,250,000 | | | | | | | | | | | 2022-2024 PSU | 2/14/2022 | | | | 0 | 30,317 | 60,634 | | | | | $5,167,806 | | | RSU | 2/14/2022 | | | | | | | 5,053 | | | | 773,023 | | | Stock Awards Total | | | | | | | | | | | | 5,940,829 | | | Option | 2/14/2022 | | | | | | | | 99,811 | $165.89 | $165.60 | 2,318,959 | | J. Wolk | Annual Incentive | | 0 | 1,275,000 | 2,550,000 | | | | | | | | | | | 2022-2024 PSU | 2/14/2022 | | | | 0 | 24,081 | 48,162 | | | | | 4,104,823 | | | RSU | 2/14/2022 | | | | | | | 4,014 | | | | 614,074 | | | Stock Awards Total | | | | | | | | | | | | 4,718,897 | | | Option | 2/14/2022 | | | | | | | | 79,280 | 165.89 | 165.60 | 1,841,952 | | J. Taubert | Annual Incentive | | 0 | 1,020,000 | 2,040,000 | | | | | | | | | | | 2022-2024 PSU | 2/14/2022 | | | | 0 | 24,316 | 48,632 | | | | | 4,144,881 | | | RSU | 2/14/2022 | | | | | | | 4,053 | | | | 620,040 | | | Stock Awards Total | | | | | | | | | | | | 4,764,921 | | | Option | 2/14/2022 | | | | | | | | 80,055 | 165.89 | 165.60 | 1,859,958 | | A. McEvoy | Annual Incentive | | 0 | 1,000,000 | 2,000,000 | | | | | | | | | | | 2022-2024 PSU | 2/14/2022 | | | | 0 | 20,081 | 40,162 | | | | | 3,422,987 | | | RSU | 2/14/2022 | | | | | | | 3,347 | | | | 512,034 | | | Stock Awards Total | | | | | | | | | | | | 3,935,021 | | | Option | 2/14/2022 | | | | | | | | 66,110 | 165.89 | 165.60 | 1,535,967 | | T. Mongon | Annual Incentive | | 0 | 925,000 | 1,850,000 | | | | | | | | | | | 2022-2024 PSU | 2/14/2022 | | | | 0 | 18,786 | 37,572 | | | | | 3,202,243 | | | RSU | 2/14/2022 | | | | | | | 3,131 | | | | 478,990 | | | Stock Awards Total | | | | | | | | | | | | 3,681,233 | | | Option | 2/14/2022 | | | | | | | | 61,849 | 165.89 | 165.60 | 1,436,969 |

  156. 2022 Outstanding Equity Awards at Fiscal Year-End

    2022 Outstanding Equity Awards at Fiscal Year-End In the table below, we show the outstanding options, RSUs and PSUs as of fiscal year-end 2022.

  157. 2022 Outstanding Equity Awards at Fiscal Year-End

    | A | B | C | D | E | F | G | H | I | J | K | | Name | Grant Date | Vesting Date | Options | | | | Stock Awards | | | | | | | | Number of Securities Underlying Unexercised Options (#) | | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plans: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | | | | Exercisable | Unexercisable | | | | | | | | J. Duato | Options | | | | | | | | | | | | 1/16/2013 | 1/16/2016 | 148,538 | | $72.54 | 1/13/2023 | | | | | | | 2/10/2014 | 2/11/2017 | 130,969 | | 90.44 | 2/9/2024 | | | | | | | 2/9/2015 | 2/10/2018 | 126,369 | | 100.06 | 2/9/2025 | | | | | | | 2/8/2016 | 2/9/2019 | 125,824 | | 101.87 | 2/8/2026 | | | | | | | 2/13/2017 | 2/13/2020 | 123,291 | | 115.67 | 2/13/2027 | | | | | | | 2/12/2018 | 2/12/2021 | 105,307 | | 129.51 | 2/12/2028 | | | | | | | 2/11/2019 | 2/11/2022 | 110,868 | | 131.94 | 2/11/2029 | | | | | | | 2/10/2020 | 2/10/2023 | | 133,516 | 151.41 | 2/10/2030 | | | | | | | 2/8/2021 | 2/8/2024 | | 114,776 | 164.62 | 2/8/2031 | | | | | | | 2/14/2022 | 2/14/2025 | | 99,811 | 165.89 | 2/14/2032 | | | | | | | RSUs | | | | | | | | | | | | 2/10/2020 | 2/10/2023 | | | | | 5,220 | $922,113 | | | | | 2/8/2021 | 2/8/2024 | | | | | 5,225 | 922,996 | | | | | 2/14/2022 | 2/14/2025 | | | | | 5,053 | 892,612 | | | | | 2020- 2022 PSU Award | | | | | | | | | | | | 2/10/2020 | 2/10/2023 | | | | | 31,319 | 5,532,501 | | | | | 2021 - 2023 PSU Award | | | | | | | | | | | | 2/8/2021 | 2/8/2024 | | | | | 0 | 0 | 39,283 | $6,939,342 | | | 2022 - 2024 PSU Award | | | | | | | | | | | | 2/14/2022 | 2/14/2025 | | | | | 0 | 0 | 37,472 | 6,619,429 | | J. Wolk | Options | | | | | | | | | | | | 2/9/2015 | 2/10/2018 | 13,015 | | 100.06 | 2/9/2025 | | | | | | | 2/8/2016 | 2/9/2019 | 16,820 | | 101.87 | 2/8/2026 | | | | | | | 2/13/2017 | 2/13/2020 | 19,241 | | 115.67 | 2/13/2027 | | | | | | | 2/12/2018 | 2/12/2021 | 12,066 | | 129.51 | 2/12/2028 | | | | | | | 2/11/2019 | 2/11/2022 | 66,386 | | 131.94 | 2/11/2029 | | | | | | | 2/10/2020 | 2/10/2023 | | 88,219 | 151.41 | 2/10/2030 | | | | | | | 2/8/2021 | 2/8/2024 | | 80,976 | 164.62 | 2/8/2031 | | | | | | | 2/14/2022 | 2/14/2025 | | 79,280 | 165.89 | 2/14/2032 | | | | | | | RSUs | | | | | | | | | | | | 2/10/2020 | 2/10/2023 | | | | | 3,449 | 609,266 | | | | | 2/8/2021 | 2/8/2024 | | | | | 3,686 | 651,132 | | | | | 2/14/2022 | 2/14/2025 | | | | | 4,014 | 709,073 | | | | | 2020- 2022 PSU Award | | | | | | | | | | | | 2/10/2020 | 2/10/2023 | | | | | 20,693 | 3,655,418 | | | | | 2021 - 2023 PSU Award | | | | | | | | | | | | 2/8/2021 | 2/8/2024 | | | | | 0 | 0 | 27,715 | 4,895,855 | | | 2022 - 2024 PSU Award | | | | | | | | | | | | 2/14/2022 | 2/14/2025 | | | | | 0 | 0 | 29,764 | 5,257,811 |

  158. 2022 Outstanding Equity Awards at Fiscal Year-End

    | | 2023 Proxy Statement | 103 |

  159. 2022 Outstanding Equity Awards at Fiscal Year-End

    | A | B | C | D | E | F | G | H | I | J | K | | Name | Grant Date | Vesting Date | Options | | | | Stock Awards | | | | | | | | Number of Securities Underlying Unexercised Options (#) | | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plans: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | | | | Exercisable | Unexercisable | | | | | | | | J. Taubert | Options | | | | | | | | | | | | 2/10/2014 | 2/11/2017 | 59,397 | | 90.44 | 2/9/2024 | | | | | | | 2/9/2015 | 2/10/2018 | 58,504 | | 100.06 | 2/9/2025 | | | | | | | 2/8/2016 | 2/9/2019 | 56,471 | | 101.87 | 2/8/2026 | | | | | | | 2/13/2017 | 2/13/2020 | 43,712 | | 115.67 | 2/13/2027 | | | | | | | 2/12/2018 | 2/12/2021 | 43,391 | | 129.51 | 2/12/2028 | | | | | | | 2/11/2019 | 2/11/2022 | 67,397 | | 131.94 | 2/11/2029 | | | | | | | 2/10/2020 | 2/10/2023 | | 91,324 | 151.41 | 2/10/2030 | | | | | | | 2/8/2021 | 2/8/2024 | | 82,127 | 164.62 | 2/8/2031 | | | | | | | 2/14/2022 | 2/14/2025 | | 80,055 | 165.89 | 2/14/2032 | | | | | | | RSUs | | | | | | | | | | | | 2/10/2020 | 2/10/2023 | | | | | 3,570 | $630,641 | | | | | 2/8/2021 | 2/8/2024 | | | | | 3,739 | 660,494 | | | | | 2/14/2022 | 2/14/2025 | | | | | 4,053 | 715,962 | | | | | 2020- 2022 PSU Award | | | | | | | | | | | | 2/10/2020 | 2/10/2023 | | | | | 21,422 | 3,784,196 | | | | | 2021 - 2023 PSU Award | | | | | | | | | | | | 2/8/2021 | 2/8/2024 | | | | | 0 | 0 | 28,109 | $4,965,455 | | | 2022 - 2024 PSU Award | | | | | | | | | | | | 2/14/2022 | 2/14/2025 | | | | | 0 | 0 | 30,054 | 5,309,039 | | A. McEvoy | Options | | | | | | | | | | | | 2/10/2014 | 2/11/2017 | 49,225 | | 90.44 | 2/9/2024 | | | | | | | 2/9/2015 | 2/10/2018 | 46,803 | | 100.06 | 2/9/2025 | | | | | | | 2/8/2016 | 2/9/2019 | 43,689 | | 101.87 | 2/8/2026 | | | | | | | 2/13/2017 | 2/13/2020 | 37,361 | | 115.67 | 2/13/2027 | | | | | | | 2/12/2018 | 2/12/2021 | 41,889 | | 129.51 | 2/12/2028 | | | | | | | 2/11/2019 | 2/11/2022 | 58,972 | | 131.94 | 2/11/2029 | | | | | | | 2/10/2020 | 2/10/2023 | | 76,712 | 151.41 | 2/10/2030 | | | | | | | 2/8/2021 | 2/8/2024 | | 68,894 | 164.62 | 2/8/2031 | | | | | | | 2/14/2022 | 2/14/2025 | | 66,110 | 165.89 | 2/14/2032 | | | | | | | RSUs | | | | | | | | | | | | 2/10/2020 | 2/10/2023 | | | | | 2,999 | 529,773 | | | | | 2/8/2021 | 2/8/2024 | | | | | 3,136 | 553,974 | | | | | 2/14/2022 | 2/14/2025 | | | | | 3,347 | 591,248 | | | | | 2020- 2022 PSU Award | | | | | | | | | | | | 2/10/2020 | 2/10/2023 | | | | | 17,994 | 3,178,640 | | | | | 2021 - 2023 PSU Award | | | | | | | | | | | | 2/8/2021 | 2/8/2024 | | | | | 0 | 0 | 23,580 | 4,165,407 | | | 2022 - 2024 PSU Award | | | | | | | | | | | | 2/14/2022 | 2/14/2025 | | | | | 0 | 0 | 24,820 | 4,384,453 |

  160. 2022 Outstanding Equity Awards at Fiscal Year-End

    | 104 | 2023 Proxy Statement | |

  161. 2022 Outstanding Equity Awards at Fiscal Year-End

    | A | B | C | D | E | F | G | H | I | J | K | | Name | Grant Date | Vesting Date | Options | | | | Stock Awards | | | | | | | | Number of Securities Underlying Unexercised Options (#) | | Option Exercise Price ($) | Option Expiration Date | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($) | Equity Incentive Plan Awards: Number of Unearned Shares, Units, or Other Rights That Have Not Vested (#) | Equity Incentive Plans: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | | | | Exercisable | Unexercisable | | | | | | | | T. Mongon | Options | | | | | | | | | | | | 2/10/2020 | 2/10/2023 | | 58,447 | 151.41 | 2/10/2030 | | | | | | | 2/8/2021 | 2/8/2024 | | 69,470 | 164.62 | 2/8/2031 | | | | | | | 2/14/2022 | 2/14/2025 | | 61,849 | 165.89 | 2/14/2032 | | | | | | | RSUs | | | | | | | | | | | | 2/10/2020 | 2/10/2023 | | | | | 2,285 | $403,645 | | | | | 2/8/2021 | 2/8/2024 | | | | | 3,163 | 558,744 | | | | | 2/14/2022 | 2/14/2025 | | | | | 3,131 | 553,091 | | | | | 2020- 2022 PSU Award | | | | | | | | | | | | 2/10/2020 | 2/10/2023 | | | | | 13,710 | 2,421,872 | | | | | 2021 - 2023 PSU Award | | | | | | | | | | | | 2/8/2021 | 2/8/2024 | | | | | 0 | 0 | 23,777 | $4,200,207 | | | 2022 - 2024 PSU Award | | | | | | | | | | | | 2/14/2022 | 2/14/2025 | | | | | 0 | 0 | 23,219 | 4,101,636 |

  162. 2022 Outstanding Equity Awards at Fiscal Year-End

    Vesting Date (Column C) Our options, RSUs and PSUs vest 100% three-years from the date of grant. PSUs are not distributed until the percent of target vested based on performance is certified by the Committee at the end of the three-year performance period. Number of Shares or Units of Stock that Have Not Vested (Column H) The PSUs that have been earned based on performance to date are included in column H. See 2020-2022 Performance Share Unit (PSU) Payout on page 69 for details. Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights that Have Not Vested (Column J) We calculated the estimated number of PSUs to vest in the future assuming:

  163. 2022 Outstanding Equity Awards at Fiscal Year-End

    | l | 2021-2023 PSUs tied to (i) Relative TSR performance vest at 117.0% of target and (ii) cumulative adjusted EPS performance vest at 133.6% of target. | | l | 2022-2024 PSUs tied to (i) Relative TSR performance vest at 156.0% of target and (ii) cumulative adjusted EPS performance vest at 91.2% of target. |

  164. 2022 Outstanding Equity Awards at Fiscal Year-End

    Market Value of Shares or Units of Stock That Have Not Vested (Columns I and K) We calculated the market values of unvested RSUs and PSUs included in columns I and K using the closing price of our common stock on the NYSE on December 30, 2022, which was the last business day of fiscal 2022, of $176.65.

  165. 2022 Outstanding Equity Awards at Fiscal Year-End

    | | 2023 Proxy Statement | 105 |

  166. 2022 Option Exercises and Stock Vested

    2022 Option Exercises and Stock Vested In the table below, we show how many options each executive exercised in 2022 and the value received from exercising them. We also show how many PSUs and RSUs vested in 2022 and their value when they vested.

  167. 2022 Option Exercises and Stock Vested

    | Name | Option Awards | | Stock Awards | | | | Number of Shares Acquired on Exercise (#) | Value Realized Upon Exercise ($) | Number of Shares Acquired on Vesting (#) | Value Realized Upon Vesting ($) | | J. Duato | 84,423 | $8,650,825 | 35,138 | $5,845,098 | | J. Wolk | 14,781 | 1,351,073 | 21,041 | 3,500,106 | | J. Taubert | 76,923 | 8,018,407 | 21,361 | 3,553,335 | | A. McEvoy | 73,323 | 7,546,953 | 18,691 | 3,109,190 | | T. Mongon | 83,074 | 4,830,204 | 7,681 | 1,285,328 |

  168. 2022 Option Exercises and Stock Vested

    | 106 | 2023 Proxy Statement | |

  169. 2022 Pension Benefits

    2022 Pension Benefits In the table below, we show the present value of pension benefits as of year-end 2022 and payments during 2022. For a complete understanding of the table, please read the description of the pension benefits that follows the table.

  170. 2022 Pension Benefits

    | Name | Number of Years Credited Service (#) | Normal Retirement Age | Present Value of Accumulated Benefits | | | Payments During Last Fiscal Year ($) | | | | | Salaried Pension Plan ($) | Excess Pension Plan ($) | Total ($) | | | J. Duato | 33 | 62 | $1,672,000 | $16,241,000 | $17,913,000 | $0 | | J. Wolk | 24 | 62 | 989,000 | 6,434,000 | 7,423,000 | 0 | | J. Taubert | 17 | 62 | 826,000 | 5,059,000 | 5,885,000 | 0 | | A. McEvoy | 26 | 62 | 865,000 | 4,467,000 | 5,332,000 | 0 | | T. Mongon | 3 | 62 | 99,000 | 514,000 | 613,000 | 0 |

  171. 2022 Pension Benefits

    We calculated the present values in the table using the same assumptions we used for the pension liabilities included in our 2022 Annual Report. We provide pension benefits to our employees to provide retirement income, facilitate succession, and motivate long-service. Our pension benefits are paid through our Salaried Pension Plan and Excess Pension Plan as described below. The named executive officers participate in the defined benefit pension plan on the same basis as other U.S. non-union employees. For all NEOs other than Mr. Mongon, their pension benefit is determined solely under the formula that applies to other eligible U.S. non-union employees hired before January 1, 2015 (the Final Average Pay formula). We offset the benefits from the Final Average Pay plans for amounts earned from our non-U.S. pension plans. For Mr. Mongon, his pension benefit is determined under the formula applicable to employees hired on or after January 1, 2015 (the Retirement Value Plan, or “RVP”, formula). The Final Average Pay and RVP formulas are described below. Starting on January 1, 2026, all eligible U.S. non-union employees (regardless of hire date) will accrue benefits under the defined benefit pension plan formula that applies to employees hired on or after January 1, 2015.

  172. 2022 Pension Benefits

    | l | U.S. Final Average Pay Pension Formula: This formula determines a monthly annuity amount payable for life. | | | | | l | Retirement Age: At age 62 former employees can begin receiving unreduced pension payments. At age 55 they can begin receiving reduced pension benefits. If a former employee begins receiving his or her pension before age 62, the pension is reduced by 4% per year for each year before age 62. | | | | l | Monthly Annuity Amount: We calculate the monthly annuity amount as: | | | | | (1) | Final average earnings multiplied by 1.667%, multiplied by years of service prior to 2005, plus | | | | (2) | Final average earnings multiplied by 1.55%, multiplied by years of service after 2004, minus | | | | (3) | Age 65 Social Security benefits multiplied by 1.429%, multiplied by total years of service, plus | | | | (4) | Frozen grandfathered benefits related to pre-2009 dividend equivalents on unvested CLCs (less than 2% of the total pension benefit for each named executive officer). | | | l | Final Average Earnings: Final average earnings is the average of the highest consecutive 60 months out of the last 120 months of pay. Earnings include base salary and annual incentive payouts. | | | | l | Benefits Paid as an Annuity: Final Average Pay benefits under the Salaried Pension Plan and Excess Pension Plan must be taken in the form of an annuity. | |

  173. 2022 Pension Benefits

    | | 2023 Proxy Statement | 107 |

  174. 2022 Pension Benefits

    | l | U.S. Retirement Value Plan Pension Formula: This formula determines a lump sum payable at the time the employee is deemed to have 'retired' from Johnson & Johnson (generally separation from Johnson & Johnson, or if later, attainment of a specified age). | | | | l | Retirement Age: At age 62 former employees can begin receiving unreduced pension payments. At age 55 they can begin receiving reduced pension benefits. If a former employee begins receiving his or her pension before age 62, the pension is reduced for each year before age 62. | | | l | Lump Sum Amount: Johnson & Johnson calculates the lump sum amount as an RVP credit of 15% of “plan earnings” (see below) for each year of service. The sum of each year’s RVP credits equals the pension benefit payable as a lump sum at age 62. | | | l | Plan Earnings: Earnings include base salary and annual incentive payouts. | | | l | Form of Benefit Payment: RVP benefits under the Excess Pension Plan benefit are available only as a lump sum. RVP benefits under the Salaried Pension Plan are expressed as a lump sum but can also be payable in one of the optional annuity forms available for RVP benefits under the Salaried Pension Plan. | | l | Pension Plans: We pay our U.S. pensions from the Salaried and Excess Pension Plans as follows: | | | | l | Salaried Pension Plan: The Salaried Pension Plan applies the Final Average Pay and RVP formulas, as applicable, to pay up to the IRS’s covered compensation limit. The limit was $305,000 in 2022. | | | l | Excess Pension Plan: The Excess Pension Plan uses the Final Average Pay and RVP pension formulas, as applicable, without applying the IRS pay limits. Its payments are reduced by amounts paid from the Salaried Pension Plan. U.S. non-union employees participate in the Excess Pension Plan if their covered compensation exceeds the IRS limit. |

  175. 2022 Pension Benefits

    | 108 | 2023 Proxy Statement | |

  176. 2022 Non-Qualified Deferred Compensation

    2022 Non-Qualified Deferred Compensation In the table below, we show our named executive officers’ year-end non-tax-qualified compensation deferral plan balances. We also show how much they and the Company contributed to the plans, the earnings on the deferred compensation, and withdrawals and distributions during the year. For a complete understanding of the table, please read the descriptions of the columns that follow the table.

  177. 2022 Non-Qualified Deferred Compensation

    | A | B | C | D | E | F | | Name | Executive Contributions in Last FY ($) | Registrant Contributions in Last FY ($) | Aggregate Earnings in Last FY ($) | Aggregate Withdrawals / Distributions ($) | Aggregate Balance at Last FYE ($) | | J. Duato | $0 | $53,368 | $85,318 | $0 | $8,805,899 | | J. Wolk | 0 | 31,656 | (26,497) | 157,719 | 388,842 | | J. Taubert | 1,782,727 | 31,656 | (992,782) | 506,930 | 6,736,914 | | A. McEvoy | 0 | 30,583 | (11,516) | 647,720 | 2,731,052 | | T. Mongon | 0 | 27,554 | (13,553) | 197,135 | 89,700 |

  178. 2022 Potential Payments Upon Termination

    2022 Potential Payments Upon Termination We pay earned and unpaid compensation to our employees upon termination as described below. In addition, depending upon the circumstances of the termination and the employee’s age and years of service, we pay severance, provide continued health benefit coverage and provide continued vesting in equity incentives as described below. We have no change-in-control benefits.

  179. 2022 Potential Payments Upon Termination

    | l | Earned but Unpaid Compensation: Upon any termination of employment as of year-end 2022, employees would receive their 2022 annual incentive and vested non-qualified deferred compensation. They would also be entitled to their pension benefits upon retirement. If a named executive officer had terminated as of year-end 2022, he or she would have received his or her: | | | | l | Earned but Unpaid Annual Incentives for 2022. An employee must be employed through the end of the year to be eligible for a non-pro-rated annual incentive payout. However, in case of involuntary termination for cause, these amounts would be forfeited. See the Non-Equity Incentive Plan Compensation table on page 94 for the annual incentive amounts. | | | l | Vested Non-Qualified Deferred Compensation Balances. See the Non-Qualified Deferred Compensation — Aggregate Balance at Last Fiscal Year-End (Column F) table on page 109 for the year-end balances. | | | l | Pension Benefits upon Retirement. See 2022 Pension Benefits on page 106 for details. | | l | Severance, Healthcare Coverage and Equity Incentives: In the following table, we show the value of cash severance, continued healthcare coverage and continued vesting in equity incentives as if the named executive officers had terminated as of year-end 2022 under the circumstances shown below. For a complete understanding of the table please read the descriptions of the types of payments that follow the table. | | | l | No Change-in-Control Benefits: We do not have any change-in-control agreements or arrangements in place for any of our named executive officers. Our 2022 Long-Term Incentive Plan only provides for a change-in-control benefit in the event that outstanding awards granted under the plan are not assumed or substituted by the acquirer in connection with a change-in-control, in which case the awards will vest and any performance conditions will be deemed to be achieved at the greater of target or actual performance levels as of the date of the change-in-control. If outstanding awards are assumed or substituted, the awards will remain outstanding and will continue to vest following the change-in-control. | |

  180. 2022 Potential Payments Upon Termination

    | | 2023 Proxy Statement | 111 |

  181. 2022 Potential Payments Upon Termination

    | Name | Type of Payment | Voluntary Termination ($) | Involuntary Termination Without Cause ($) | Involuntary Termination with Cause ($) | Death ($) | Disability ($) | | J. Duato | Cash Severance | $0 | $1,903,846 | $0 | $0 | $0 | | | Healthcare Coverage | 141,000 | 146,000 | 141,000 | 74,000 | 227,000 | | | Equity Incentives | 27,653,658 | 27,653,658 | 0 | 27,653,658 | 27,653,658 | | | Total | 27,794,658 | 29,703,504 | 141,000 | 27,727,658 | 27,880,658 | | J. Wolk | Cash Severance | 0 | 1,020,000 | 0 | 0 | 0 | | | Healthcare Coverage | 184,000 | 190,000 | 184,000 | 96,000 | 283,000 | | | Equity Incentives | 19,832,397 | 19,832,397 | 0 | 19,832,397 | 19,832,397 | | | Total | 20,016,397 | 21,042,397 | 184,000 | 19,928,397 | 20,115,397 | | J. Taubert | Cash Severance | 0 | 1,020,000 | 0 | 0 | 0 | | | Healthcare Coverage | 131,000 | 139,000 | 131,000 | 70,000 | 249,000 | | | Equity Incentives | 20,220,185 | 20,220,185 | 0 | 20,220,185 | 20,220,185 | | | Total | 20,351,185 | 21,379,185 | 131,000 | 20,290,185 | 20,469,185 | | A. McEvoy | Cash Severance | 0 | 1,000,000 | 0 | 0 | 0 | | | Healthcare Coverage | 0 | 144,000 | 0 | 10,000 | 298,000 | | | Equity Incentives | 0 | 0 | 0 | 16,879,845 | 16,879,845 | | | Total | 0 | 1,144,000 | 0 | 16,889,845 | 17,177,845 | | T. Mongon (1) | Cash Severance | 0 | 925,000 | 0 | 0 | 0 | | | Healthcare Coverage | 0 | 101,000 | 0 | 10,000 | 345,000 | | | Equity Incentives | 0 | 0 | 0 | 15,215,616 | 15,215,616 | | | Total | 0 | 1,026,000 | 0 | 15,225,616 | 15,560,616 |

  182. 2022 Potential Payments Upon Termination

    (1) If Mr. Mongon had terminated without cause as of fiscal year-end 2022, the payment of his $3,000,000 engagement award that is contingent on the successful separation of the Consumer Health business would have been accelerated.

  183. 2022 Potential Payments Upon Termination

    | Terminations Due to a Reduction in Force or Specified Divestiture |

  184. 2022 Potential Payments Upon Termination

    All of our unvested outstanding long-term incentive awards are subject to special provisions in the event of a termination due to a Reduction in Force (RIF) or Specified Divestiture (as detailed on page 81). As of December 30, 2022, each named executive officer except Ms. McEvoy and Mr. Mongon was eligible for Qualifying Separation treatment of their long-term incentives. For these executives:

  185. 2022 Potential Payments Upon Termination

    | l | Termination due to a RIF would result in amounts equal to those in the Involuntary Termination Without Cause column of the Potential Payments Upon Termination table above, and | | l | Termination due to a Specified Divestiture would result in amounts equal to those in the Involuntary Termination Without Cause column, except they would not receive severance. |

  186. 2022 Potential Payments Upon Termination

    If Ms. McEvoy or Mr. Mongon had been terminated due to either a RIF or Specified Divestiture, he or she would have been eligible to receive a pro-rated portion of his or her unvested long-term incentives rather than the zeros shown in the Potential Payment Upon Termination table. As of December 30, 2022, the total value of Ms. McEvoy's and Mr. Mongon's pro-rated long-term incentives was $10,610,491 and $9,237,639, respectively.

  187. 2022 Potential Payments Upon Termination

    | Cash Severance |

  188. 2022 Potential Payments Upon Termination

    Our Severance Pay Plan provides benefits to certain full-time U.S. employees who are involuntarily terminated. We provide two weeks base salary for each year of service, with guaranteed minimums based on an employee’s level. The minimum for our named executive officers is 52 weeks of base salary. We pay severance according to our normal payroll cycle. We do not pay severance as a lump-sum payment. In order to receive the full number of weeks of base salary under our Severance Pay Plan, U.S. employees must sign a release agreement and comply with the conditions set forth in the agreement which may include compliance with

  189. 2022 Potential Payments Upon Termination

    | 112 | 2023 Proxy Statement | |

  190. 2022 Potential Payments Upon Termination

    non-competition provisions, release of all claims and rights, and any other terms set forth in the agreement. If U.S. employees do not sign the release agreement, the severance amount is four weeks of base salary. In the table below, we show how the Cash Severance amounts in the table above were calculated.

  191. 2022 Potential Payments Upon Termination

    | Name | Salary Rate as of Year-End ($) | Years of Eligible Service (#) | Weeks of Base Salary Continuation | | | Total Amount of Cash Severance ($) | | | | | Accrued (#) | Minimum (#) | Final (#) | | | J. Duato | $1,500,000 | 33 | 66 | 52 | 66 | $1,903,846 | | J. Wolk | 1,020,000 | 24 | 48 | 52 | 52 | 1,020,000 | | J. Taubert | 1,020,000 | 17 | 34 | 52 | 52 | 1,020,000 | | A. McEvoy | 1,000,000 | 26 | 52 | 52 | 52 | 1,000,000 | | T. Mongon | 925,000 | 22 | 44 | 52 | 52 | 925,000 |

  192. 2022 Potential Payments Upon Termination

    | | 2023 Proxy Statement | 113 |

  193. 2022 Potential Payments Upon Termination

    | Healthcare Coverage |

  194. 2022 Potential Payments Upon Termination

    Upon termination of employment, all non-union U.S. employees receive continued healthcare coverage that varies based upon the termination circumstances. The Healthcare Coverage amounts in the table on page 111 are the present values of continued healthcare coverage. The values vary based upon the termination circumstances as follows:

  195. 2022 Potential Payments Upon Termination

    | Healthcare Coverage | Eligibility | Eligible Named Executive Officers | Voluntary Termination | Involuntary Termination Without Cause | Involuntary Termination with Cause | Death | Disability | | Retiree | Employees age 55 with ten years of service | Duato Wolk Taubert | ü | ü Begins at the end of the cash severance period | ü | ü Coverage for dependents | ü | | Separation | Employees between ages 50 and 54 with ten years of service who are involuntarily terminated without cause | McEvoy Mongon | Not applicable | ü Begins at the earlier of the cash severance period or 52 weeks and ends at age 65 | Not applicable | Not applicable | Not applicable | | Active-employee | All Employees | | No continued coverage | ü While on severance - up to 52 weeks | No continued coverage | ü Coverage for dependents for 6 months | ü While on long-term disability |

  196. 2022 Potential Payments Upon Termination

    Note: "ü" means eligible for coverage.

  197. 2022 Potential Payments Upon Termination

    | Equity Incentives |

  198. 2022 Potential Payments Upon Termination

    The Equity Incentives amounts in the table on page 111 are the value of unvested equity incentives as of year-end 2022. The values vary based upon the termination circumstances as described under Long-Term Incentive Vesting and Treatment upon Termination on page 80.

  199. 2022 Potential Payments Upon Termination

    | 114 | 2023 Proxy Statement | |

  200. 2022 Potential Payments Upon Termination

    | Ratio of the Annual Total Compensation of the Median-Paid Employee to the CEO |

  201. 2022 Potential Payments Upon Termination

    The annual total compensation of our median-paid employee on a worldwide basis for 2022 was $80,000. The annual total compensation of our Chief Executive Officer for 2022 was $13,121,860. The ratio of the two amounts for 2022 is 164 to 1. For a complete understanding of these amounts, please read the descriptions below. We used the following methodology and assumptions to calculate the annual total compensation of the median-paid employee:

  202. 2022 Potential Payments Upon Termination

    | l | We included 100% of our employees (other than our Chief Executive Officer) in the calculation of median, as follows: | | | | l | We gathered payroll data from 24 countries around the world, which account for 92% of our employees. | | | l | We assumed that the remaining 8% of our employees (not included in this database) are paid less than the median. This is a conservative assumption. If any of the employees assumed to be below the median were paid higher than the calculated median, the actual median would be higher. | | l | We calculated the annual total compensation and ranked our employees using: (i) taxable cash earnings, which includes salary, wages (regular, hourly, overtime, shift differentials), commissions, annual incentives and other miscellaneous cash earnings; (ii) the estimated value of the Company-provided pension earned during 2022 and Company contributions to defined contribution retirement plans during 2022 (using an estimated percentage of salary for each country where we have a Company-provided retirement plan); and (iii) the estimated value of Company-provided medical and dental insurance coverage (using an estimated per-employee amount for each country where we have Company-provided medical and dental plans). | | | l | Using our year-end 2022 total employee count, we counted down from the top to identify the median-paid employee. At least 50% of our employees have annual total compensation amounts higher than $80,000. | | | l | We rounded the annual total compensation of the median-paid employee to the nearest thousand dollars. | |

  203. 2022 Potential Payments Upon Termination

    The annual total compensation of our Chief Executive Officer for 2022 is the $13,099,487 total as reported in the Summary Compensation Table on page 93 plus healthcare benefits of $22,373. The ratio of the annual total compensation of the median-paid employee to the CEO is calculated by dividing the annual total compensation of our Chief Executive Officer by that of our median-paid employee. Because the annual total compensation of the median-paid employee is a conservative estimate (as described above), the pay ratio is also a conservative estimate – the actual ratio could be lower but not higher.

  204. 2022 Potential Payments Upon Termination

    | Comparison to 2021 Median-Paid Annual Total Compensation |

  205. 2022 Potential Payments Upon Termination

    The annual total compensation of our median-paid employee for 2021 was $90,000. The median for 2022 is $80,000. The net effect of changes in currency exchange rates contributed to the decrease in the median. If the exchange rates had not changed during 2022, the median would have been $86,000.

  206. 2022 Potential Payments Upon Termination

    | | 2023 Proxy Statement | 115 |

  207. 2022 Potential Payments Upon Termination

    | Pay Versus Performance |

  208. 2022 Potential Payments Upon Termination

    In the table below, we show the compensation for our CEO (PEO in the table) and the average of the other named executive officers, our cumulative total shareholder return, net income and annual relative total shareholder return (TSR), and the cumulative total shareholder returns of our peer indices. Our executives’ compensation is shown using the totals from the Summary Compensation Table and Compensation Actually Paid (CAP) according to SEC rules.

  209. Pay Versus Performance Table

    Pay Versus Performance Table

  210. Pay Versus Performance Table

    | A | B | C | D | E | F | G | H | I | J | | | | | | | Value of Initial Fixed $100 Investment Based On: | | | | | | Year | Summary Compensation Table Total for PEO | Compensation Actually Paid to PEO | Average Summary Compensation Table Total for non-PEO NEOs | Average Compensation Actually Paid to non-PEO NEOs | Total Shareholder Return | Peer Group Total Shareholder Return (S&P Pharmaceuticals Sub Index) | Peer Group Total Shareholder Return (S&P Healthcare Equipment Sub Index) | Net Income ($millions) | Annual Relative Total Shareholder Return (% points) | | 2022 | $13,099,487 | $18,910,984 | $8,021,796 | $11,882,576 | $130.91 | $146.65 | $113.92 | 17,941 | 5.6% | | 2021 | 26,741,959 | 39,418,762 | 12,498,029 | 16,589,485 | 123.54 | 135.21 | 140.40 | 20,878 | (2.4) | | 2020 | 29,575,974 | 28,993,387 | 12,948,370 | 11,481,072 | 110.85 | 107.53 | 117.63 | 14,714 | 1.6 |

  211. Summary Compensation Table Total for PEO and Average Summary Compensation Table Total for Non-PEO NEOs (Columns B and D)

    Summary Compensation Table Total for PEO and Average Summary Compensation Table Total for Non-PEO NEOs (Columns B and D) Column B includes the amounts reported in the Total column of the Summary Compensation Table for our CEO. Column D includes the average of the amounts reported in the Total column of the Summary Compensation Table for our named executive officers excluding our CEO. In the table below, we show which executives were included in columns B through E in 2020-2022.

  212. Summary Compensation Table Total for PEO and Average Summary Compensation Table Total for Non-PEO NEOs (Columns B and D)

    | Executive Name | PEO | | | Non-PEO NEO | | | | | 2020 | 2021 | 2022 | 2020 | 2021 | 2022 | | A. Gorsky | X | X | | | | | | J. Duato | | | X | X | X | | | J. Wolk | | | | X | X | X | | P. Stoffels | | | | X | X | | | J. Taubert | | | | X | X | X | | A. McEvoy | | | | | | X | | T. Mongon | | | | | | X |

  213. Summary Compensation Table Total for PEO and Average Summary Compensation Table Total for Non-PEO NEOs (Columns B and D)

    | 116 | 2023 Proxy Statement | |

  214. Compensation Actually Paid to PEO and Average Compensation Actually Paid to Non-PEO NEOs (Columns C and E)

    Compensation Actually Paid to PEO and Average Compensation Actually Paid to Non-PEO NEOs (Columns C and E) Columns C and E, respectively, include the amount of Compensation Actually Paid to our CEO and average of our other NEOs (according to SEC rules). The amounts are not current cash payments. Our retirement benefits are paid only after retirement and our long-term incentives’ value vary with company performance (including stock price) until they are vested or exercised (in the case of options). The following table shows adjustments made to total compensation for each year to determine the Compensation Actually Paid:

  215. Compensation Actually Paid to PEO and Average Compensation Actually Paid to Non-PEO NEOs (Columns C and E)

    | Year | Summary Compensation Table Total | Minus Summary Compensation Table Value of Equity Awards | Plus Pay Versus Performance Value of Equity Awards | Minus Summary Compensation Table Change in the Actuarial Present Value of Pension Benefits | Plus Pay Versus Performance Value of Pension Benefits | Equals Compensation Actually Paid | | PEO | | | | | | | | 2022 | $13,099,487 | $8,259,788 | $13,597,284 | $0 | $474,001 | $18,910,984 | | 2021 | 26,741,959 | 19,859,172 | 32,223,745 | 676,000 | 988,230 | 39,418,762 | | 2020 | 29,575,974 | 18,140,649 | 23,565,672 | 6,436,000 | 428,390 | 28,993,387 | | Average of Non-PEO NEOs | | | | | | | | 2022 | 8,021,796 | 5,943,730 | 9,490,231 | 15,500 | 329,779 | 11,882,576 | | 2021 | 12,498,029 | 8,169,384 | 12,845,811 | 1,160,000 | 575,029 | 16,589,485 | | 2020 | 12,948,370 | 7,411,495 | 9,054,248 | 3,000,000 | (110,051) | 11,481,072 |

  216. Compensation Actually Paid to PEO and Average Compensation Actually Paid to Non-PEO NEOs (Columns C and E)

    | l | Summary Compensation Table Value of Equity Awards includes the total grant date fair value of equity awards reported in the Stock Awards and Option Awards columns in the Summary Compensation Table. | | | | l | Pay Versus Performance Value of Equity Awards includes the following: | | | | | l | For awards granted in the applicable year, the fair value: | | | | | l | At year-end for awards that are outstanding and unvested | | | | l | As of the vesting date for awards that vest in the applicable year | | | l | For awards granted in prior years, the change in fair value: | | | | | l | From the beginning of the year to the end of the year for awards that remain outstanding and unvested | | | | l | From the beginning of the year to the vesting date for awards that vest in the applicable year | | | | l | From the beginning of the year to zero for awards that fail to vest | | | l | Fair values as of each measurement date were determined using valuation assumptions and methodologies (including expected term, volatility, dividend yield and risk-free interest rates) that are consistent with those used to estimate fair value at grant under U.S. GAAP. The valuation assumptions used to calculate option fair values differed materially from those disclosed at the time of grant in the following ways: | | | | | l | Risk-free rates range from 0.3% to 4.0% for the pay-versus-performance valuations versus a range of 0.8% to 2.8% for grant-date valuations. The risk-free rates differed due to macroeconomic changes between the grant date and valuation dates. | | | | l | The expected option term estimate ranges from four years to 6.1 years for the pay versus performance valuations versus seven years for the grant date valuations. The expected term decreased from the grant date to incorporate the passage of time in the award’s life. | | | | l | All other valuation assumptions are not materially different from the grant-date assumptions and there were no changes in calculation methodology. See Common Stock, Stock Option Plans and Stock Compensation Agreements Note to the Consolidated Financial Statements of the Form 10-K for additional details on the valuation assumptions used at grant. | | | The following table shows the amounts included in the Pay Versus Performance Value of Equity Awards. | | |

  217. Compensation Actually Paid to PEO and Average Compensation Actually Paid to Non-PEO NEOs (Columns C and E)

    | | 2023 Proxy Statement | 117 |

  218. Compensation Actually Paid to PEO and Average Compensation Actually Paid to Non-PEO NEOs (Columns C and E)

    | Year | Year-End Fair Value of Equity Awards Granted During Applicable Year | Change in Fair Value as of Year-End of Any Prior-Year Awards that Remain Unvested as of Year-End | Change in Fair Value as of the Vesting Date of Any Prior -Year Awards that Vested During Applicable Year | Pay Versus Performance Value of Equity Awards | | PEO | | | | | | 2022 | $10,012,527 | $4,005,011 | $(420,254) | $13,597,284 | | 2021 | 21,784,640 | 7,510,917 | 2,928,188 | 32,223,745 | | 2020 | 17,452,777 | 3,954,446 | 2,158,449 | 23,565,672 | | Average of Non-PEO NEOs | | | | | | 2022 | 7,204,994 | 2,486,599 | (201,362) | 9,490,231 | | 2021 | 8,964,136 | 3,045,440 | 836,235 | 12,845,811 | | 2020 | 7,143,024 | 1,311,996 | 599,228 | 9,054,248 |

  219. Compensation Actually Paid to PEO and Average Compensation Actually Paid to Non-PEO NEOs (Columns C and E)

    | l | Summary Compensation Table Change in the Actuarial Present Value of Pension Benefits includes the changes in pension value reported in the Change in Pension and Non-Qualified Deferred Compensation column of the Summary Compensation Table. | | | | l | Pay Versus Performance Value of Pension Benefits includes the following: | | | | | | l | Service Costs: The actuarially determined pension service cost for services rendered by our CEO or NEOs | | | | l | Prior Service Costs: The entire cost of benefits granted (or credit for benefits reduced) in a plan amendment (or initiation) during the applicable year that is attributed by the benefit formula to services rendered in periods prior to the plan amendment or initiation. | | | l | The amounts deducted or added in calculating the Pay Versus Performance Value of Pension Benefits are as follows: | |

  220. Compensation Actually Paid to PEO and Average Compensation Actually Paid to Non-PEO NEOs (Columns C and E)

    | Year | Service Costs Attributable to the Applicable Year | Prior Service Costs Introduced During the Applicable Year | Pay Versus Performance Value of Pension Benefits | | PEO | | | | | 2022 | $474,001 | $0 | $474,001 | | 2021 | 988,230 | 0 | 988,230 | | 2020 | 948,152 | (519,762) | 428,390 | | Average of Other NEOs | | | | | 2022 | 329,779 | 0 | 329,779 | | 2021 | 575,029 | 0 | 575,029 | | 2020 | 423,888 | (533,939) | (110,051) |

  221. Analysis of the Information Presented in the Pay Versus Performance Table

    Analysis of the Information Presented in the Pay Versus Performance Table We describe the relationships between Compensation Actually Paid and the Company’s cumulative TSR, net income and annual relative TSR below. We also compare the Company’s cumulative TSR with the peer indices.

  222. Components of Compensation Actually Paid That Vary with Performance

    Components of Compensation Actually Paid That Vary with Performance The components of Compensation Actually Paid that vary with performance each year are: our annual incentive payouts, the fair value of long-term incentive awards granted in each year and the change in fair value of equity awards during the year. The decisions regarding our annual incentive payouts are described in our 2021 and 2022 Proxy Statements and this Proxy Statement. The decisions regarding our long-term incentive awards are described in our 2020, 2021 and 2022 Proxy Statements. The addition of the change in fair value of equity awards during the year is the most significant performance-related difference between CAP and the totals reported in the Summary Compensation Table. The change in fair value of equity awards during the year varies with our annual share price appreciation and performance against our PSU goals.

  223. Compensation Actually Paid and Cumulative TSR

    Compensation Actually Paid and Cumulative TSR The chart below compares the Compensation Actually Paid to our CEO and the average of our other NEOs with the Company’s cumulative TSR. As described on page 70, three-year TSR relative to our Competitor Composite Peers is one of our PSU performance measures. However, the Company’s cumulative TSR without a peer comparison is not one of the performance measures we use in our annual or long-term incentive plans. The Company’s cumulative TSR includes both our annual share price appreciation and the impact of reinvested dividends. Because most of our executives’ compensation is equity-based long-term incentives which vary in value with the Company’s price, our CAP is aligned with the annual share price appreciation component of TSR. Dividends confound the relationship because they are included in the cumulative TSR but are not included in CAP because we do not pay dividends on unvested equity awards.

  224. Compensation Actually Paid and Net Income

    Compensation Actually Paid and Net Income The chart below compares the Compensation Actually Paid to our CEO and the average of our other NEOs with the Company’s net income. As described on pages 67 and 70, adjusted operational EPS is one of our annual incentive measures and three-year cumulative adjusted operational EPS is one of our PSU performance measures. These measures are compared to goals that we set at the beginning of each year for the annual incentives and at the beginning of each 3-year performance period for the PSUs. While annual net income impacts our adjusted operational EPS and three-year cumulative adjusted operational EPS, it is not one of the performance measures we use in our annual or long-term incentive plans. Therefore, any relationship of CAP with the Company’s annual net income would be indirect, at best, because it is not a performance measure in our compensation program and it is not compared to any goals.

  225. Compensation Actually Paid and Net Income

    | 120 | 2023 Proxy Statement | |

  226. Compensation Actually Paid and Annual Relative Total Shareholder Return

    Compensation Actually Paid and Annual Relative Total Shareholder Return The chart below compares the Compensation Actually Paid to our CEO and the average of our other NEOs with the Company’s annual relative TSR. Annual relative TSR directly impacts the three overlapping PSU performance cycles that are outstanding each year. Higher annual relative TSR increases the fair value of the outstanding PSUs and conversely lower annual relative TSR decreases the fair value of outstanding PSUs. Performance against our annual incentive goals, three-year cumulative adjusted operational EPS PSU goals, and changes in the fair value of long-term incentive awards granted each year confound the relationship of CAP and annual relative TSR because they are independent of annual relative TSR. Note: we use three-year relative TSR as a PSU performance measure. However, SEC guidance limits the measures to one-year periods.

  227. Compensation Actually Paid and Annual Relative Total Shareholder Return

    | | 2023 Proxy Statement | 121 |

  228. Compensation Actually Paid and Annual Relative Total Shareholder Return

    | Annual Relative TSR | | | | | TSR | 2020 | 2021 | 2022 | | Johnson & Johnson | 9.3% | 12.8% | 8.0% | | Competitor Composite | 7.7 | 15.2 | 2.4 | | One-Year Relative TSR | 1.6 | (2.4) | 5.6 |

  229. Compensation Actually Paid and Annual Relative Total Shareholder Return

    The TSR for each of the three business groups within the Competitor Composite Peer Group is weighted based on the Company’s sales mix for the prior year as shown in the table below.

  230. Compensation Actually Paid and Annual Relative Total Shareholder Return

    | Competitor Composite Peer Group Weightings | | | | | Business Group | 2020 | 2021 | 2022 | | Pharmaceuticals | 51.4% | 54.7% | 55.1% | | MedTech | 31.6 | 27.8 | 28.9 | | Consumer Health | 16.9 | 17.5 | 16.0 | | Total | 100.0 | 100.0 | 100.0 |

  231. Compensation Actually Paid and Annual Relative Total Shareholder Return

    Note: Sum of individual components may not reflect total weighting due to rounding. The TSR for each business group is weighted by the beginning of year market capitalization of each company. The companies in each business group are shown in the table below.

  232. Compensation Actually Paid and Annual Relative Total Shareholder Return

    | Competitor Composite Peer Group | | | | Pharmaceuticals | MedTech | Consumer Health | | AbbVie Inc | Alcon | Beiersdorf AG | | Amgen Inc | Boston Scientific Corp | Colgate-Palmolive Co | | AstraZeneca PLC | Cooper Cos Inc | L'Oreal SA | | Bristol-Myers Squibb Co | The Intuitive Surgical | Procter & Gamble Co | | Eli Lilly & Co | Medtronic Inc | The Reckitt Benckiser | | GlaxoSmithKline PLC | Smith & Nephew PLC | Unilever | | Merck & Co Inc | Stryker Corp | | | Novartis AG | Zimmer Holdings Inc | | | Pfizer Inc | | | | Roche Holding AG | | | | Sanofi | | |