DEF 14A of Cisco Systems, Inc., Oct 18, 2022

DEF 14A of Cisco Systems, Inc.

Filed Oct 18, 2022 · FY20220001104659-22-109711

Open on EDGAR

  1. Director Compensation

    Director Compensation In connection with reviewing and recommending compensation for non-employee directors, the Nomination and Governance Committee retained Exequity as its independent compensation consultant during fiscal 2022. The Nomination and Governance Committee makes recommendations to the Board regarding compensation for non-employee directors using a process similar to the one used by the Compensation Committee for determining compensation for Cisco’s executive officers. Generally, the Nomination and Governance Committee annually reviews the market practice for non-employee director compensation for companies in Cisco’s Peer Group (as defined in the CD&A) in consultation with its independent compensation consultant and assesses whether our non-employee director compensation program continues to be competitive with the market for qualified directors, incorporates best practices and aligns the interests of our non-employee directors with the long-term interests of our stockholders.

  2. Director Nominations

    Director Nominations Stockholders may recommend a director nominee to Cisco’s Nomination and Governance Committee. In recommending candidates for election to the Board, the Nomination and Governance Committee considers nominees recommended by directors, officers, employees, stockholders and others, using the same criteria to evaluate all candidates. The Nomination and Governance Committee reviews each candidate’s qualifications, including whether a candidate possesses any of the specific qualities and skills desirable in certain members of the Board. Evaluations of candidates generally involve a review of background materials, internal discussions, and interviews with selected candidates as appropriate. The Nomination and Governance Committee may engage consultants or third-party search firms to assist in identifying and evaluating potential nominees. Upon selection of a qualified candidate, the Nomination and Governance Committee recommends the candidate for consideration by the full Board. For more detailed information on how to recommend a prospective nominee for the Nomination and Governance Committee’s consideration or to submit a nominee for inclusion in Cisco’s proxy materials pursuant to the proxy access provisions of Cisco’s bylaws, see the “Other Important Information About the Meeting – Stockholder Proposals and Nominations for 2023 Annual Meeting of Stockholders” section.

  3. Director Nominations

    | Acquisition Committee | Number of Meetings: 12 |

  4. Director Nominations

    | | Michael D. Capellas (Chair) | | Brenton L. Saunders | | Dr. Lisa T. Su | | Marianna Tessel |

  5. Director Nominations

    Responsibilities and Duties Include: ■ Reviews acquisition strategies and opportunities with management ■ Approves certain acquisitions and investment transactions and makes recommendations to the Board

  6. Director Nominations

    | Finance Committee | Number of Meetings: 8 |

  7. Director Nominations

    | | M. Michele Burns (Chair) | | Wesley G. Bush | | John D. Harris II | | Dr. Kristina M. Johnson |

  8. Director Nominations

    Responsibilities and Duties Include: ■ Reviews and approves our global investment policy ■ Oversees the stock repurchase program ■ Reviews investments, fixed income assets, insurance risk management policies and programs, tax programs, currency, interest rate and equity risk management policies and programs, and capital structure and capital allocation strategy Authorized to approve the issuance of debt securities, certain real estate acquisitions and leases, and charitable contributions made on behalf of Cisco

  9. Director Nominations

    | Cisco 2022 Proxy Statement | 11 |

  10. Director Nominations

    Board’s Role in Strategy One of the Board’s key responsibilities is overseeing management’s formulation and execution of Cisco’s strategy. Throughout the year, our CEO, the executive leadership team, and other leaders from across the organization provide detailed business and strategy updates to the Board. During these reviews, the Board engages with the executive leadership team and other business leaders regarding various topics, including business strategy and initiatives, capital allocation, portfolio updates, the competitive landscape, talent and culture (including inclusion and diversity), ESG matters (including our environmental impact and human rights implications of Cisco product development and sales), and regulatory developments. Additionally, on an annual basis, the Board reviews and approves Cisco’s financial plan. The Lead Independent Director chairs regularly scheduled executive sessions of the independent directors, without Cisco management present, during which Cisco’s business strategy is reviewed and other topics are discussed. Board’s Role in Risk Oversight We believe that risk is inherent in innovation and the pursuit of long-term growth opportunities. Our management is responsible for day-to-day risk management activities. The Board, acting directly and through its committees, is responsible for the oversight of our risk management. With the oversight of the Board, our management team has implemented practices, processes and programs designed to help manage the risks to which we are exposed in our business and to align risk-taking appropriately with our efforts to increase stockholder value. Our management team has implemented an enterprise risk management (“ERM”) program designed to work across the organization to identify, evaluate, govern and manage risks, as well as our response to those risks. This risk assessment process considers whether risks are short-, medium-, or long-term, such that the management of significant risks can be prioritized, in part, based on the timeframe of such risks. Our internal audit function manages the enterprise ERM program and performs an annual risk assessment which is utilized by the ERM program, which is informed by industry trends, benchmarking and third-party professionals. The structure of the ERM program includes both an ERM operating committee that focuses on risk management-related topics, and an ERM executive committee consisting of members of management, including our Chief Legal Officer who is also our Chief Compliance Officer and reports directly to the CEO. The ERM operating committee conducts global risk reviews and provides regular updates to the ERM executive committee. The Audit Committee, which oversees our financial and risk management policies, including data protection (comprising both privacy and security), receives regular reports on ERM from the chair of the ERM operating committee. Additionally, the Audit Committee receives regular reports on cybersecurity from senior management on a quarterly basis and receives a detailed presentation from our Chief Security and Trust Officer two or more times per year. As part of its responsibilities and duties, the Audit Committee reviews our policies and programs for addressing data protection, including both privacy and security, including with respect to (a) our products and services, (b) the servers, data centers and cloud-based solutions on which Cisco’s and third-party data is stored or processed (including servers, data centers and cloud-based solutions operated by third parties on which we rely), and (c) the cloud-based services provided to, by or enabled by Cisco. The Audit Committee provides updates to the Board on such review. As part of the overall risk oversight framework, other committees of the Board also oversee certain categories of risk associated with their respective areas of responsibility. For example, the Finance Committee oversees matters related to risk management policies and programs addressing currency, interest rate, equity, and insurance risk, as well as Cisco’s customer and channel partner financing activities, investment policy and certain risk management activities of Cisco’s treasury function. The Compensation Committee oversees compensation-related risk management, as discussed in the “Governance and Board Matters – Corporate Governance – Board of Directors – Board Committees and Meetings – Compensation and Management Development Committee” and “Compensation Committee Matters – Executive Compensation – CD&A” sections in this Proxy Statement. Each committee reports regularly to the full Board on its activities. In addition, the Board participates in regular discussions with our executive management on many core subjects, including strategy, operations, information systems, finance, legal and public policy matters, in which risk oversight is an inherent element. The Board believes the leadership structure described in the “Governance and Board Matters – Corporate Governance – Board of Directors – Board Leadership Structure” section facilitates the Board’s oversight of risk management because it allows the Board, with leadership from the Lead Independent Director and working through its committees, including the independent Audit Committee, to proactively participate in the oversight of management’s actions. Director Qualifications, Skills and Attributes The table below summarizes key qualifications, skills and attributes most relevant to the decision to nominate our director candidates to serve on the Board. A mark indicates a specific area of focus or experience on which the Board relies most. The lack of a mark does not mean the director nominee does not possess that qualification or skill. Each director nominee biography in Governance and Board Matters – Proposal No. 1 – Election of Directors below describes each nominee’s qualifications and relevant experience in more detail. Board Performance Evaluation Process The Board recognizes that a robust and constructive performance evaluation process is an essential component of Board effectiveness. As such, the Board conducts an annual performance evaluation that is intended to determine whether the Board, each of its committees, and individual Board members are functioning effectively, and to provide them with an opportunity to reflect upon and improve processes and effectiveness. The Nomination and Governance Committee oversees this annual process, which is led by the Lead Independent Director. As part of this process, the Lead Independent Director, along with outside counsel, conducts one-on-one discussions with each Board member and certain members of management to obtain their assessment of the effectiveness and performance of the Board, its committees, and individual Board members. A summary of the results of this process is presented to the Nomination and Governance Committee identifying any themes or issues that have emerged. The results are then reported to the full Board, which considers the results and ways in which Board processes and effectiveness may be enhanced.

  11. Director Nominations

    | Cisco 2022 Proxy Statement | 13 |

  12. Director Nominations

    Board Refreshment We regularly evaluate the need for Board refreshment. The Nomination and Governance Committee and the Board are focused on identifying individuals whose skills and experiences will enable them to make meaningful contributions to the shaping of Cisco’s business strategy. In August 2022, the Board appointed Sarah Rae Murphy as a director upon the recommendation of the Nomination and Governance Committee. For more information on the skills and experience of Ms. Murphy, see “Governance and Board Matters – Proposal No. 1 – Election of Directors.” As part of its consideration of director succession, the Nomination and Governance Committee from time-to-time reviews, including when considering potential candidates, the appropriate skills and characteristics required of Board members such as diversity of business experience, viewpoints and personal background, and diversity of skills in technology, finance, marketing, international business, financial reporting and other areas that are expected to contribute to an effective Board. In evaluating potential candidates for the Board, the Nomination and Governance Committee considers these factors in the light of the specific needs of the Board at that time. Additionally, due to the global and complex nature of our business, the Board believes it is important to include individuals with diversity of race, ethnicity, gender, sexual orientation, age, education, cultural background, and professional experiences, and those factors are considered in evaluating board candidates in order to provide practical insights and diverse perspectives. Cisco policy provides that the Board will take into consideration the age of any current or prospective Board member whose age would be 72 or older when elected, re-elected, or appointed to the Board and, before nominating or appointing such Board member, the Board will make an affirmative determination that it is in the best interests of Cisco and its stockholders for that individual to serve on the Board, which affirmative determination the Board made with respect to the nomination of Mr. McGeary. The average tenure of the director nominees is approximately 7.3 years. The Nomination and Governance Committee and the Board will regularly evaluate the key qualifications, skills and attributes required in order to effectively refresh the Board with engaged and dynamic leaders with a proven business track record who will bring fresh perspectives to the Board while maintaining the productive working dynamics and collegiality of the Board. The brief biographical description of each nominee set forth in the “Governance and Board Matters – Proposal No. 1 – Election of Directors – Business Experience and Qualifications of Nominees” section and the matrix set forth in “Governance and Board Matters – Corporate Governance – Board of Directors – Director Qualifications, Skills and Attributes” section above include the primary individual experience, qualifications, attributes, and skills of each of our directors that led to the conclusion that each director should serve as a member of the Board at this time.

  13. Director Nominations

    | Five of our independent director nominees have joined our Board since 2019, representing 45% of our independent Board members. |

  14. Director Nominations

    | Joined in 2019 | Joined in 2020 | Joined in 2021 | | Joined in 2022 | | | | | | | | Wesley G. Bush | Dr. Lisa T. Su | John D. Harris II | Marianna Tessel | Sarah Rae Murphy |

  15. Director Nominations

    Stockholder Communications with the Board Stockholders may communicate with our Board through Cisco’s Secretary by sending an email to bod@cisco.com, or by writing to the following address: Board of Directors c/o Evan Sloves, Secretary Cisco Systems, Inc. 170 West Tasman Drive San Jose, California 95134 Stockholders also may communicate with the Board’s Compensation Committee through Cisco’s Secretary by sending an email to compensationcommittee@cisco.com, or by writing to the following address: Compensation and Management Development Committee c/o Evan Sloves, Secretary Cisco Systems, Inc. 170 West Tasman Drive San Jose, California 95134 Cisco’s Secretary will forward all correspondence to the Board or the Compensation Committee, except for spam, junk mail, mass mailings, product or service complaints or inquiries, job inquiries, surveys, business solicitations or advertisements, or patently offensive or otherwise inappropriate material. Cisco’s Secretary may forward certain correspondence, such as product-related inquiries, elsewhere within Cisco for review and possible response.

  16. Director Nominations

    | Cisco 2022 Proxy Statement | 15 |

  17. Director Nominations

    Proposal No. 1 – Election of Directors The names of persons who are nominees for director and their current positions and offices with Cisco are set forth in the table below. The proxy holders intend to vote all proxies received by them for the nominees listed below unless otherwise instructed. Each of the current directors has been nominated for election by the Board upon recommendation by the Nomination and Governance Committee and has decided to stand for election. The authorized number of directors is twelve. The Board appointed Sarah Rae Murphy to the Board in August 2022 upon recommendation of the Nomination and Governance Committee. Ms. Murphy was brought to the attention of the Nomination and Governance Committee as a potential candidate by a third-party search firm.

  18. Director Nominations

    | Director Nominees | Positions and Offices Held with Cisco | Age | Director Since | Other Public Company Boards | | M. Michele Burns | Director | 64 | 2003 | 3 | | Wesley G. Bush | Director | 61 | 2019 | 2 | | Michael D. Capellas | Lead Independent Director | 68 | 2006 | 3 | | Mark Garrett | Director | 64 | 2018 | 3 | | John D. Harris II | Director | 61 | 2021 | 2 | | Dr. Kristina M. Johnson | Director | 65 | 2012 | 1 | | Roderick C. McGeary | Director | 72 | 2003 | 2 | | Sarah Rae Murphy | Director | 39 | 2022 | – | | Charles H. Robbins | Chair and CEO | 56 | 2015 | 1 | | Brenton L. Saunders | Director | 52 | 2017 | 2 | | Dr. Lisa T. Su | Director | 52 | 2020 | 1 | | Marianna Tessel | Director | 54 | 2021 | – |

  19. Director Nominations

    Business Experience and Qualifications of Nominees

  20. Director Nominations

    | M. Michele Burns Independent Director Age: 64 Director since: 2003 Committees Audit Finance (Chair) Other Public Company Directorships ■ Anheuser-Busch InBev SA/NV ■ Etsy, Inc. ■ The Goldman Sachs Group Former Public Company Directorships in the Past Five Years ■ Alexion Pharmaceuticals, Inc. (ending in 2018) | Business Experience Ms. Burns has served on the Advisory Board of the Center on Longevity at Stanford University since October 2019 and previously served as the Center Fellow and Strategic Advisor from August 2012 to October 2019. She served as the Chief Executive Officer of the Retirement Policy Center sponsored by Marsh & McLennan Companies, Inc. (“Marsh”) from October 2011 to February 2014. From September 2006 to October 2011, Ms. Burns served as Chair and Chief Executive Officer of Mercer LLC (“Mercer”), a global leader for human resources and related financial advice and services. She assumed that role after joining Marsh in March 2006 as Chief Financial Officer. From May 2004 to January 2006, Ms. Burns served as Chief Financial Officer and Chief Restructuring Officer of Mirant Corporation (“Mirant”), where she successfully helped Mirant restructure and emerge from bankruptcy. In 1999, Ms. Burns joined Delta Air Lines, Inc. assuming the role of Chief Financial Officer in 2000 and holding that position through April 2004. She began her career in 1981 at Arthur Andersen LLP and became a partner in 1991. Qualifications Ms. Burns provides the Board expertise in corporate finance, accounting and strategy, including experience gained as the chief financial officer of three public companies. Through her experience as the chief executive officer of Mercer LLC, she brings expertise in global and operational management, including a background in organizational leadership and human resources. Ms. Burns also has experience serving as a public company outside director. |

  21. Director Nominations

    | Wesley G. Bush Independent Director Age: 61 Director since: 2019 Committees Compensation Finance Other Public Company Directorships ■ Dow Inc. ■ General Motors Corporation Former Public Company Directorships in the Past Five Years ■ Norfolk Southern Corporation (ending in 2019) ■ Northrop Grumman Corporation (ending in 2019) | Business Experience Mr. Bush served as Chief Executive Officer of Northrop Grumman Corporation (“Northrop Grumman”) from January 2010 through December 2018 and served on its board from September 2009 to July 2019 and in the role of chair from July 2011 to July 2019. Prior to January 2010, he served in various leadership roles, including as Northrop Grumman’s President and Chief Operating Officer, Corporate Vice President and Chief Financial Officer, and President of its Space Technology sector. Mr. Bush also served in various leadership roles at TRW Inc. prior to its acquisition by Northrop Grumman in 2002. Mr. Bush is a member of the National Academy of Engineering. Qualifications Mr. Bush brings to the Board his extensive international business experience, including over 35 years in the aerospace and defense industry. In addition, he brings extensive financial, sales and marketing, strategic and operational experience. Mr. Bush also has experience serving as a public company outside director. |

  22. Director Nominations

    | Cisco 2022 Proxy Statement | 17 |

  23. Director Nominations

    | Michael D. Capellas Lead Independent Director Age: 68 Director since: 2006 Committees Nomination and Governance (Chair) Acquisition (Chair) Other Public Company Directorships ■ Flex Ltd., Chair ■ Elliott Opportunity II Corp., a special purpose acquisition company (“SPAC”) ■ The Beauty Health Company Former Public Company Directorships in the Past Five Years ■ MuleSoft, Inc. (ending in 2018) | Business Experience Mr. Capellas has served as founder and Chief Executive Officer of Capellas Strategic Partners since November 2012. He served as Chair of the Board of VCE Company, LLC (“VCE”) from January 2011 until November 2012 and as Chief Executive Officer of VCE from May 2010 to September 2011. Mr. Capellas was the Chair and Chief Executive Officer of First Data Corporation from September 2007 to March 2010. From November 2002 to January 2006, he served as Chief Executive Officer of MCI, Inc. (“MCI”), previously WorldCom. From November 2002 to March 2004, he was also Chair of the Board of WorldCom, and he continued to serve as a member of the board of directors of MCI until January 2006. Mr. Capellas left MCI as planned in early January 2006 upon its acquisition by Verizon Communications Inc. Previously, Mr. Capellas was President of Hewlett-Packard Company (“Hewlett-Packard”) from May 2002 to November 2002. Before the merger of Hewlett-Packard and Compaq Computer Corporation (“Compaq”) in May 2002, Mr. Capellas was President and Chief Executive Officer of Compaq, a position he had held since July 1999, and Chair of the Board of Compaq, a position he had held since September 2000. Mr. Capellas held earlier positions as Chief Information Officer and Chief Operating Officer of Compaq. Qualifications Mr. Capellas brings to the Board experience in executive roles and a background of leading global organizations in the technology industry. Through this experience, he has developed expertise in several valued areas including strategic product development, business development, sales, marketing, and finance. Mr. Capellas also has experience serving as a public company outside director. |

  24. Director Nominations

    | Mark Garrett Independent Director Age: 64 Director since: 2018 Committees Audit (Chair) Nomination and Governance Other Public Company Directorships ■ GoDaddy Inc. ■ NightDragon Acquisition Corp., a SPAC ■ Snowflake Inc. Former Public Company Directorships in the Past Five Years ■ Pure Storage, Inc. (ending in 2021) | Business Experience Mr. Garrett has served as a Senior Advisor at Permira since June 2021. Mr. Garrett served as Executive Vice President and Chief Financial Officer of Adobe Systems Incorporated from February 2007 to April 2018. From January 2004 to February 2007, Mr. Garrett served as Senior Vice President and Chief Financial Officer of the Software Group of EMC Corporation (“EMC”). From August 2002 to January 2004 and from 1997 to 1999, Mr. Garrett served as Executive Vice President and Chief Financial Officer of Documentum, Inc., including through its acquisition by EMC in December 2003. Qualifications Mr. Garrett brings to the Board extensive history of leadership in finance and accounting in the technology industry, including experience in product and business model transition and transformation to the cloud. Mr. Garrett also has experience serving as a public company outside director. |

  25. Director Nominations

    | John D. Harris II Independent Director Age: 61 Director since: 2021 Committees Finance Other Public Company Directorships ■ Flex Ltd. ■ Kyndryl Holdings, Inc. | Business Experience Mr. Harris served as Vice President of Business Development of Raytheon Company (“Raytheon”) and Chief Executive Officer of Raytheon International, Inc. from September 2013 to April 2020. Mr. Harris joined Raytheon in 1983 and throughout his career at Raytheon, he held various leadership positions, including serving as General Manager of Raytheon’s Intelligence, Information and Services business, President of Raytheon Technical Services Company, Vice President of Operations and Contracts for Raytheon’s former Electronic Systems business, Vice President of Contracts for Raytheon’s government and defense businesses, and Vice President of Contracts and Supply Chain for Raytheon Company. In 2010, Mr. Harris was honored with the prestigious Black Engineer of the Year Award. Qualifications Mr. Harris brings to the Board an extensive history of leadership in sales and marketing, supply chain management, international business and government relations operations functions, including expertise in both technology and manufacturing industries. |

  26. Director Nominations

    | Dr. Kristina M. Johnson Independent Director Age: 65 Director since: 2012 Committees Compensation Finance Other Public Company Directorships ■ DuPont de Nemours, Inc. Former Public Company Directorships in the Past Five Years ■ The AES Corporation (ending in 2019) | Business Experience Dr. Johnson has served as the President of The Ohio State University since September 2020. Previously Dr. Johnson served as the chancellor of the State University of New York from September 2017 to August 2020. From January 2014 to September 2017, Dr. Johnson served as the Chief Executive Officer of Cube Hydro Partners, LLC, a clean energy company, and a joint venture between Enduring Hydro, a company she founded in January 2011, and I Squared Capital, a private equity firm. From May 2009 to October 2010, Dr. Johnson served as Under Secretary of Energy at the U.S. Department of Energy. Prior to this, Dr. Johnson was Provost and Senior Vice President for Academic Affairs at The Johns Hopkins University from 2007 to 2009 and Dean of the Pratt School of Engineering at Duke University from 1999 to 2007. Previously, she served as a professor in the Electrical and Computer Engineering Department, University of Colorado and as director of the National Science Foundation Engineering Research Center for Optoelectronics Computing Systems at the University of Colorado, Boulder. She holds 119 U.S. and international patents and has received the John Fritz Medal, widely considered the highest award given in the engineering profession. Dr. Johnson was inducted into the National Inventors Hall of Fame in 2015, and she is also a member of the National Academy of Engineering. Qualifications Dr. Johnson brings to the Board an engineering background, as well as expertise in science, technology, business, education and government. In addition, she has leadership and management experience, both in an academic context as chancellor, provost and dean of nationally recognized academic institutions and in a corporate context as a board member of public companies. |

  27. Director Nominations

    | Cisco 2022 Proxy Statement | 19 |

  28. Director Nominations

    | Roderick C. McGeary Independent Director Age: 72 Director since: 2003 Committees Audit Compensation (Chair) Nomination and Governance Other Public Company Directorships ■ PACCAR Inc. ■ Raymond James Financial, Inc. | Business Experience Mr. McGeary served as Chair of Tegile Systems, Inc. from June 2010 to June 2012. From November 2004 to December 2009, he served as Chair of the Board of BearingPoint, Inc.(“BearingPoint”) and also was interim Chief Executive Officer of BearingPoint from November 2004 to March 2005. Mr. McGeary served as Chief Executive Officer of Brience, Inc. from July 2000 to July 2002. From April 2000 to June 2000, he served as a Managing Director of KPMG Consulting LLC, a wholly owned subsidiary of BearingPoint (formerly KPMG Consulting, Inc.). From August 1999 to April 2000, he served as Co-President and Co-Chief Executive Officer of BearingPoint. From January 1997 to August 1999, he was employed by KPMG LLP (“KPMG”) as its Co-Vice Chair of Consulting. Prior to 1997, he served in several capacities with KPMG, including audit partner for technology clients. Mr. McGeary is a Certified Public Accountant and holds a B.S. degree in Accounting from Lehigh University. Qualifications Mr. McGeary brings to the Board a combination of executive experience in management and technology consulting. He also has expertise in leading talented teams, as well as skills in finance, accounting and auditing with technology industry experience. Mr. McGeary also has experience serving as a public company outside director. |

  29. Director Nominations

    | Sarah Rae Murphy Independent Director Age: 39 Director since: 2022 Committees Audit | Business Experience Ms. Murphy served as Chief Procurement Officer and Senior Vice President, Global Sourcing of United Airlines Holdings, Inc. (“United Airlines”) from October 2021 to May 2022. She held other executive leadership roles at United Airlines including Senior Vice President, United Express from June 2019 to October 2021 and Vice President, Global Operations Strategy, Planning and Design from October 2016 to June 2019. At United Airlines, she previously also held various financial leadership positions including Vice President of Financial Planning and Analysis and leading investor relations. Prior to joining United Airlines in 2006, Ms. Murphy began her career at Merrill Lynch in its investment banking division. Qualifications Ms. Murphy brings to the Board broad executive leadership experience in finance, operations and commercial functions in a global business. Her enterprise experience in leading innovation and transformation to enhance customer experience adds a valuable perspective to the Board. |

  30. Director Nominations

    | Charles H. Robbins Board Chair Age: 56 Director since: 2015 Other Public Company Directorships ■ BlackRock, Inc. | Business Experience Mr. Robbins has served as CEO since July 2015, as a member of the Board since May 2015 and as Chair of the Board since December 2017. He joined Cisco in December 1997, from which time until March 2002 he held a number of managerial positions within Cisco’s sales organization. Mr. Robbins was promoted to Vice President in March 2002, assuming leadership of Cisco’s U.S. channel sales organization. Additionally, in July 2005 he assumed leadership of Cisco’s Canada channel sales organization. In December 2007, Mr. Robbins was promoted to Senior Vice President, U.S. Commercial, and in August 2009 he was appointed Senior Vice President, U.S. Enterprise, Commercial and Canada. In July 2011, Mr. Robbins was named Senior Vice President, Americas. In October 2012, Mr. Robbins was promoted to Senior Vice President, Worldwide Field Operations, in which position he served until assuming the role of CEO. Qualifications Mr. Robbins brings to the Board extensive industry, company and operational experience acquired from having served as Cisco’s CEO since 2015, and prior to that from having led Cisco’s global sales and partner teams. He has a thorough knowledge of Cisco’s segments, technology areas, geographies and competition. He has a proven track record of driving results and played a key role in leading and executing many of Cisco’s investments and strategy shifts to meet its growth initiatives. |

  31. Director Nominations

    | Brenton L. Saunders Independent Director Age: 52 Director since: 2017 Committees Compensation Acquisition Other Public Company Directorships ■ The Beauty Health Company, Executive Chair ■ BridgeBio Pharma, Inc. | Business Experience Mr. Saunders has served as Executive Chair of The Beauty Health Company since May 2021. Previously, he served as President, Chief Executive Officer and Chair of the Board of Vesper Healthcare Acquisition Corp. (“Vesper”) from July 2020 to May 2021 when Vesper completed a business combination with The HydraFacial Company and the resulting company was renamed The Beauty Health Company. Previously he served as CEO and President of Allergan plc (“Allergan”) from July 2014 to May 2020 when Allergan was acquired by AbbVie, Inc. He was a board member of Allergan from July 2014 to May 2020 and served as its Chair from October 2016 to May 2020. He previously served as Chief Executive Officer and President of Forest Laboratories, Inc. (“Forest”) from October 2013 until July 2014 and had served as a board member of Forest beginning in 2011. In addition, Mr. Saunders served as Chief Executive Officer of Bausch + Lomb Incorporated, a leading global eye health company, from March 2010 until August 2013. From 2003 to 2010, Mr. Saunders also held a number of leadership positions at Schering-Plough Corporation (“Schering-Plough”), including the position of President of Global Consumer Health Care and was named head of integration for Schering-Plough’s merger with Merck & Co. and for its acquisition of Organon BioSciences. Before joining Schering-Plough, Mr. Saunders was a Partner and Head of Compliance Business Advisory Group at PricewaterhouseCoopers LLP from 2000 to 2003. Prior to that, he was Chief Risk Officer at Coventry Health Care, Inc. and Senior Vice President, Compliance, Legal and Regulatory at Home Care Corporation of America. Mr. Saunders began his career as Chief Compliance Officer for the Thomas Jefferson University Health System. Qualifications Mr. Saunders brings to the Board his extensive leadership experience, including his role as chief executive officer of two global healthcare companies, as well as his financial, strategic and operational experience. He is a natural innovator and leader with a deep understanding of business transformation. Mr. Saunders also has experience serving as a public company outside director. |

  32. Director Nominations

    | Cisco 2022 Proxy Statement | 21 |

  33. Director Nominations

    | Dr. Lisa T. Su Independent Director Age: 52 Director since: 2020 Committees Acquisition Other Public Company Directorships ■ Advanced Micro Devices, Inc., Chair Former Public Company Directorships in the Past Five Years ■ Analog Devices, Inc. (ending 2020) | Business Experience Dr. Su joined Advanced Micro Devices, Inc. (“AMD”) in 2012 and has held the position of President and Chief Executive Officer since October 2014. She also has served on AMD’s Board since October 2014 and as its Chair since February 2022. Previously, Dr. Su served as Senior Vice President and General Manager, Networking and Multimedia at Freescale Semiconductor, Inc. (“Freescale”), and was responsible for global strategy, marketing and engineering for the company’s embedded communications and applications processor business. Dr. Su joined Freescale in 2007 as Chief Technology Officer, where she led the company’s technology roadmap and research and development efforts. Dr. Su spent the previous 13 years at International Business Machines Corporation (“IBM”) in various engineering and business leadership positions, including Vice President of the Semiconductor Research and Development Center responsible for the strategic direction of IBM’s silicon technologies, joint development alliances and semiconductor R&D operations. Prior to IBM, she was a member of the technical staff at Texas Instruments Incorporated from 1994 to 1995. Dr. Su has a Bachelor of Science, Master of Science and Doctorate degrees in Electrical Engineering from the Massachusetts Institute of Technology (MIT). Qualifications Dr. Su brings to the Board her extensive business leadership experience, including her role as chair, president and chief executive officer of a global semiconductor company, as well as her technology and semiconductor expertise. Dr. Su also provides expertise in global strategy, marketing and engineering, and has experience serving as a public company outside director. |

  34. Director Nominations

    | Marianna Tessel Independent Director Age: 54 Director since: 2021 Committees Acquisition | Business Experience Ms. Tessel has served as Executive Vice President and Chief Technology Officer of Intuit Inc. (“Intuit”), a financial software company, since January 2019. From June 2017 to December 2018, she served as Chief Product Development officer of Intuit’s Small Business & Self-Employed Group. Prior to joining Intuit, Ms. Tessel served as Senior Vice President of Engineering and Executive Vice President of Strategic Development for Docker Inc., a software containerization platform. She also previously served as Vice President of Engineering with VMware Inc. Qualifications Ms. Tessel brings to the Board her deep expertise in enterprise software and a track record delivering software solutions that solve challenges for businesses. She is also a transformational leader in the software technology industry with a strong engineering background. |

  35. Director Nominations

    Board Diversity Due to the global and complex nature of our business, the Board believes it is important to consider diversity of race, ethnicity, gender, sexual orientation, age, education, cultural background, and professional experiences in evaluating board candidates in order to provide practical insights and diverse perspectives. Below is an overview of our director nominee diversity. Our 12 director nominees comprise a well-balanced, diverse Board of Directors.

  36. Director Nominations

    | Cisco 2022 Proxy Statement | 23 |

  37. Board Diversity Matrix (As of October 10, 2022)

    * African American or Black, and Alaskan Native or Native American Independent Directors Upon recommendation of the Nomination and Governance Committee, the Board has affirmatively determined that each member of the Board other than Mr. Robbins is independent under the criteria established by Nasdaq for director independence. All members of our Audit, Compensation, and Nomination and Governance committees are independent directors. In addition, upon recommendation of the Nomination and Governance Committee, the Board has determined that the members of the Audit Committee and the members of the Compensation Committee meet the additional independence criteria required for membership on those committees under applicable Nasdaq listing standards. The Nasdaq criteria includes a subjective test and various objective standards, such as the director is not an employee of Cisco. Mr. Robbins is deemed not independent because he is a Cisco employee. The subjective test under Nasdaq criteria for director independence requires that each independent director not have a relationship that, in the opinion of the Board, would interfere with the exercise of independent judgment in carrying out the responsibilities of a director. The subjective evaluation of director independence by the Board was made in the context of the objective standards referenced above. In making its independence determinations, the Board generally considers commercial, financial services, charitable, and other transactions, as well as other relationships between Cisco and each director and nominee and his or her family members and affiliated entities. For example, the Nomination and Governance Committee reviewed, for each independent director and nominee, transactions between Cisco and other organizations where such directors serve as executive officers or directors, none of which exceeded 1% of the recipient’s annual revenues during the relevant periods, except as described below. For each of the independent directors, the Board determined based on the recommendation of the Nomination and Governance Committee that none of the transactions or other relationships exceeded Nasdaq objective standards and none would otherwise interfere with the exercise of independent judgment in carrying out the responsibilities of a director. In making this determination, the Board considered certain relationships that did not exceed Nasdaq objective standards but were identified by the Nomination and Governance Committee for further consideration under the subjective test. The Board determined that none of these relationships would interfere with the exercise of independent judgment by the director in carrying out their responsibilities as a director. The following is a description of the relationships in which a director serves as an outside board member of other companies and in which payments by Cisco exceeded 1% of the recipient’s annual revenues: ■ Mr. Capellas and Mr. Harris are members of the board of directors of Flex Ltd. Cisco has ordinary course commercial relationships with Flex Ltd., including design, manufacturing and after-market services. Payments by Cisco to Flex Ltd. exceeded 1% of the annual revenues of Flex Ltd. in each of Cisco’s past three fiscal years. ■ Mr. Garrett is a member of the board of directors of Snowflake Inc. Cisco has purchased cloud data warehouse platform services from Snowflake Inc. Payments by Cisco to Snowflake Inc. exceeded 1% of the annual revenues of Snowflake in Cisco’s fiscal 2020. Director Compensation This section provides information regarding the compensation policies for non-employee directors and amounts paid and equity awards granted to these directors in fiscal 2022. Non-employee directors typically do not receive forms of remuneration or benefits other than those described below but are reimbursed for their expenses in attending meetings and other board-related activities. Cisco’s non-employee director compensation policy is designed to provide the appropriate amount and form of compensation to our non-employee directors. Director Compensation Highlights ■ Retainer fees for committee service differentiated based on workload ■ Emphasis on equity in the overall compensation mix ■ Full-value equity grants under a fixed-value annual grant policy with immediate vesting ■ Robust stock ownership guidelines set at five times the annual cash retainer to support stockholder alignment ■ Flexible deferral provisions to facilitate stock ownership ■ Governance limit of $800,000 on the total value of cash and equity compensation that may be paid or granted to a non-employee director each fiscal year allows Cisco to stay within reasonable boundaries of what the market requires ■ Each non-employee director is eligible to participate in Cisco’s charitable matching gifts program to the same extent as all Cisco employees. The maximum match amount currently under this program is $25,000 each calendar year and additional $10,000 matches are available for disaster response campaigns. Fiscal 2022 Cash Compensation Effective during the period from the beginning of fiscal 2022 to, but excluding, the date of the 2021 Annual Meeting, our non-employee director cash compensation program consisted of the following: ■ Annual retainer of $80,000 for each non-employee director ■ Additional annual retainer fee of $50,000 for serving as Lead Independent Director ■ Additional annual retainer fee of $25,000 for serving as chair of the Audit Committee ■ Additional annual retainer fee of $20,000 for serving as chair of the Compensation Committee ■ Additional annual retainer fee of $15,000 for serving as chair of the Nomination and Governance Committee, as chair of the Acquisition Committee or as chair of the Finance Committee ■ Additional fee of $2,000 to each committee member for each standing committee meeting attended A non-employee director may, in lieu of all or a specified portion of their regular annual cash retainer, elect to receive fully vested shares of Cisco common stock, fully vested deferred stock units or a deferred cash payment under the Cisco Systems, Inc. Deferred Compensation Plan (the “Deferred Compensation Plan”). Dividend equivalents accrue on fully vested deferred stock units and are subject to the same conditions and restrictions as the deferred stock units to which they attach and will settle in shares after the non-employee director leaves the board. The annual retainers are pro-rated for non-employee directors who are appointed after an annual meeting.

  38. Board Diversity Matrix (As of October 10, 2022)

    | Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1) | All Other Compensation ($)(2) | Total ($) | | M. Michele Burns | $149,579 | $244,990 | $25,000 | $419,569 | | Wesley G. Bush | $110,826(3) | $244,990 | $– | $355,816 | | Michael D. Capellas | $196,584 | $244,990 | $30,350 | $471,924 | | Mark Garrett | $156,065 | $244,990 | $– | $401,055 | | John D. Harris II | $98,870 | $244,990 | $– | $343,860 | | Dr. Kristina M. Johnson | $114,826(3) | $244,990 | $– | $359,816 | | Roderick C. McGeary | $163,978 | $244,990 | $– | $408,968 | | Sarah Rae Murphy(4) | $– | $– | $– | $– | | Brenton L. Saunders | $110,826(5) | $244,990 | $– | $355,816 | | Dr. Lisa T. Su | $94,870(3) | $244,990 | $– | $339,860 | | Marianna Tessel | $90,870(3) | $244,990 | $– | $335,860 |

  39. Board Diversity Matrix (As of October 10, 2022)

    (1) The amounts in the “Stock Awards” column represent the aggregate grant date fair values, computed in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718, Compensation – Stock Compensation (“FASB ASC Topic 718”), of the shares issued pursuant to the 2005 Stock Incentive Plan. Each non-employee director who had served as a non-employee director prior to the 2021 Annual Meeting and who was elected at the 2021 Annual Meeting received 4,180 fully vested shares on December 13, 2021. Mr. Bush, Dr. Johnson, Mr. Saunders, Dr. Su and Ms. Tessel each elected to receive their annual equity award in the form of fully vested deferred stock units. None of the non-employee directors held any unvested stock awards as of July 30, 2022. No stock options were outstanding or awarded to non-employee directors in fiscal 2022. (2) Represents the non-employee director’s match under Cisco’s charitable matching gifts program. (3) Includes the value of fully vested shares of Cisco common stock received in lieu of the non-employee director’s regular cash retainer, additional retainer paid in connection with service on Board committees, or other cash fees, based on the fair market value of the shares on the date any such retainers or cash fees would otherwise have been paid. Based on their prior elections, Mr. Bush, Dr. Johnson, Dr. Su and Ms. Tessel each received deferred stock units with a value of $98,763, $49,716, $88,782 and $88,779, respectively, based on the closing share price of Cisco common stock on the date any such retainers or cash fees would otherwise have been paid. (4) Ms. Murphy was appointed to the Board after the completion of fiscal 2022 and did not receive any compensation for fiscal 2022. (5) Mr. Saunders elected to defer receipt of a portion of his regular cash retainer earned in fiscal 2022 and all additional retainers paid in connection with service on Board committees in the amount of $69,696 into the Deferred Compensation Plan. Non-Employee Director Stock Ownership Our corporate governance policies include stock ownership guidelines for non-employee directors. These guidelines call for each non-employee director to own shares of Cisco’s common stock having a value equal to at least five times the non-employee director’s regular annual cash retainer, with a five-year period from the date of his or her appointment to attain that ownership level. To facilitate share ownership, in lieu of all or a specified portion of their regular annual cash retainer, any retainer paid in connection with service on any committee of the Board or other cash fees, non-employee directors may elect to receive fully vested shares of Cisco common stock or fully vested deferred stock units that would be settled in shares after the non-employee director leaves the Board, based on the fair market value of the shares on the date any such cash retainer or fee would otherwise be paid. Any shares (or shares subject to deferred stock units) received in lieu of any portion of a cash retainer or fee do not count against the limit on the total number of shares that may be granted to a non-employee director during any fiscal year. The shares issued are granted under the 2005 Stock Incentive Plan.

  40. Board Diversity Matrix (As of October 10, 2022)

    Proposal No. 2 – Advisory Vote to Approve Executive Compensation Under Section 14A of the Exchange Act, Cisco stockholders are entitled to cast an advisory vote to approve the compensation of Cisco’s named executive officers, known as a “Say on Pay” vote. The stockholder vote is an advisory vote only and is not binding on Cisco or its Board of Directors. Although the vote is non-binding, the Board and the Compensation Committee value the opinions of our stockholders and will consider the outcome of the vote when making future compensation decisions for our named executive officers. The core of Cisco’s executive compensation philosophy and practice continues to align real pay delivery with performance. Cisco’s executive officers are compensated in a manner consistent with Cisco’s business strategy, competitive practice, sound corporate governance principles, and stockholder interests and concerns. We believe our compensation program is strongly aligned with the long-term interests of our stockholders. We urge you to read the CD&A, the compensation tables, and the narrative discussion set forth on pages 31 to 65 for additional details on Cisco’s executive compensation program. Below are a few highlights of our pay-for-performance philosophy. Fiscal 2022 Pay and Performance At the beginning of fiscal 2022, the Board adopted a financial plan in the midst of considerable uncertainty caused in part by the COVID-19 pandemic and significant supply constraints. The Compensation Committee subsequently approved fiscal 2022 incentive award targets in accordance with this plan. In fiscal 2022, we delivered growth in total revenue and strong profitability in a challenging environment impacted by significant supply constraints, rising component and related costs, and the Russia and Ukraine war. We set several new records for the company including product orders, ending backlog, net income, earnings per share (“EPS”), annualized recurring revenue (“ARR”), and remaining performance obligations (“RPO”). These were strong results, particularly considering the incredibly dynamic environment in which we continue to operate. We believe that we have made continued progress on our strategic priorities and remain focused on delivering innovation across our technologies to assist our customers in executing on their digital transformations. We also continued to make progress in the transition of our business model delivering increased software and subscriptions. Our fiscal 2022 incentive plan financial results were as follows: ■ Revenue1 4% above fiscal 2021 ■ Operating Income1 4% above fiscal 2021 ■ Operating Cash Flow 14% below fiscal 2021 ■ EPS1 4% above fiscal 2021 1 Revenue and Operating Income as determined pursuant to the EIP, and EPS as determined pursuant to the PRSUs, as set forth in the CD&A below. Long-term incentives continue to be the largest element of named executive officer compensation, consistent with market practice. For Cisco’s named executive officers, approximately 60% of long-term grant value is in performance shares earned for achievement against rigorous goals for operating cash flow, EPS, and relative total stockholder return (“TSR”) performance measured over three years. Our PRSUs for fiscal 2020 – 2022 were earned at 44.3% of target as operating cash flow and EPS performance were at 88.7% of target over the three-year period, while relative TSR for the three-year period was below the threshold performance level, reflect the rigor applied to the Compensation Committee’s goal setting.

  41. Annual Executive Incentive Plan

    Annual Executive Incentive Plan Our revenue and operating income under the EIP resulted in a company performance factor (“CPF”) of 0.58 for fiscal 2022, down from 1.18 in fiscal 2021, reflecting below target achievement of financial performance goals. The Compensation Committee set the fiscal 2022 targets for revenue and operating income 9% and 8% above fiscal 2021 performance, respectively, as measured under the EIP. The Compensation Committee took into consideration supply challenges, which we expected would continue at least through the first half of fiscal 2022.

  42. Annual Executive Incentive Plan

    | | Performance Criteria | | | Pay for Performance Results | | | Fiscal 2022 Goals ($ billions) | | | Fiscal 2022 Results ($ billions) | | | Threshold | Target | Maximum | | | Revenue | $51.3 (95% of target) | $54.0 | $55.6 (103% of target) | $51.6 (96% of target) | | Operating Income | $16.3 (91% of target) | $17.9 | $19.4 (108% of target) | $17.3 (96% of target) |

  43. 2020-2022 PRSU Plan

    | Performance Criteria | Pay-for-Performance Results | | | | | Fiscal 2020 Grant | Cash Flow/EPS(1) | Relative TSR(2) | | Earned PRSUs = Target PRSUs x ((50% x Average Financial Goal Multiplier) + (50% x Relative TSR Multiplier)) | Fiscal 2022 | 54% | 0% | | | Fiscal 2021 | 128% | | | | Fiscal 2020 | 84% | | | | Result | 88.7% | 0% | | | PRSUs Earned | 44.3% of Target | |

  44. Environmental, Social, and Governance

    | Reward Actual Achievement | Align Interests | | Compensate for achievement of short-term and long-term company financial and operating goals, and refrain from providing special benefits, “golden parachute” excise tax gross-ups, or accelerated equity vesting except in limited circumstances. | Align the interests of our executives with our stockholders by tying a significant portion of total compensation to our overall financial and operating performance and the creation of long-term stockholder value. |

  45. Variable Cash Incentive Awards

    Variable Cash Incentive Awards The objective of Cisco’s annual cash incentive program is to reward achievement of our annual financial performance (80% weighting) and ESG performance (20% weighting), and to establish appropriate company performance expectations to ensure that our executives are accountable for our continued growth and profitability while striving to conduct our business in an environmentally sustainable manner. Performance measures and goals for determining our named executive officers’ fiscal 2022 annual incentive awards were pre-established under

  46. Variable Cash Incentive Awards

    | Cisco 2022 Proxy Statement | 35 |

  47. Variable Cash Incentive Awards

    Cisco’s EIP. The pre-established performance goals were based on Cisco’s achievement of financial performance goals, expressed as the CPF, and an ESG factor that is determined based on the executive leadership team’s joint execution of Cisco’s ESG strategy. The Compensation Committee established such performance measures and goals based on feedback from stockholders, an informed review of Cisco’s targeted financial performance for fiscal 2022, and the pay practices of the companies in our Peer Group.

  48. How Variable Cash Incentive Awards Work

    How Variable Cash Incentive Awards Work Despite continued uncertain economic environment caused in part by the ongoing COVID-19 pandemic and significant supply constraints, Cisco returned to annual performance goals under the EIP for the named executive officers for fiscal 2022. The financial performance metrics for awards under the EIP for fiscal 2022 continued to be based on the same financial performance metrics as were used in fiscal 2021, and the specific financial targets are the same as those used under the company-wide bonus plan. For fiscal 2022, the target bonus was based on a CPF of 1.0. Cisco’s financial performance must have exceeded its fiscal 2022 financial plan established by the Board for the CPF to exceed 1.0. For fiscal 2022, the IPF in our EIP for the named executive officers was discontinued and replaced with an ESG factor, which was scored based on the executive leadership team’s joint execution of Cisco’s ESG strategy. For each named executive officer, the fiscal 2022 EIP awards were calculated by multiplying an individual’s annual base salary for fiscal 2022 by the individual’s target award percentage, and multiplying the result by the sum of 80% of the CPF and 20% of the ESG factor, as follows:

  49. BONUS = BASE × TARGET × ((CPF × 0.80) + (ESG Factor × 0.20))

    BONUS = BASE × TARGET × ((CPF × 0.80) + (ESG Factor × 0.20)) The Compensation Committee does not have the discretion to award bonuses under the EIP if the applicable performance criteria have not been met. The fiscal 2022 cash incentive awards for each named executive officer participant were as follows:

  50. BONUS = BASE × TARGET × ((CPF × 0.80) + (ESG Factor × 0.20))

    | Named Executive Officer | Base Salary(1) | Target Award Percentage(1) | Company Performance Factor (80%) | ESG Factor (20%) | EIP Payment | | Charles H. Robbins | $1,390,000 | 260% | 0.58 | 1.75 | $2,941,796 | | R. Scott Herren | $838,292 | 160% | 0.58 | 1.75 | $1,091,792 | | Maria Martinez | $838,292 | 160% | 0.58 | 1.75 | $1,091,792 | | Jeff Sharritts | $624,931 | 126% | 0.58 | 1.75 | $657,653 | | Dev Stahlkopf | $673,141 | 160% | 0.58 | 1.75 | $876,698 | | Gerri Elliott | $744,421 | 149% | 0.58 | 1.75 | $924,125 |

  51. BONUS = BASE × TARGET × ((CPF × 0.80) + (ESG Factor × 0.20))

    (1) The base salary amounts for Mr. Herren and Ms. Martinez reflect the fiscal 2022 base salary increases in October 2021. The base salary amount and target award percentage for Mr. Sharritts reflect his base salary increase in October 2021 and his promotion to Executive Vice President and Chief Customer and Partner Officer in May 2022. The base salary amount and target award percentage for Ms. Elliott reflects her transition to Executive Advisor in May 2022.

  52. Company Performance Factor (CPF)

    The revenue and operating income goals and results were calculated for purposes of the EIP in accordance with pre-established rules. Revenue was Cisco’s GAAP revenue excluding the effects of the impact of changes in GAAP and the effects of business combinations and divestitures subject to pre-established criteria and thresholds. Operating income was Cisco’s GAAP operating income excluding the following: share-based compensation expense; compensation expense related to acquisitions and divestitures; changes in estimates of contingent consideration related to acquisitions; gains or losses on acquisitions and divestitures; amortization or impairment of acquired intangible assets including in-process research and development; all external acquisition and divestiture-related costs such as finder’s fees, advisory, legal, accounting, valuation, hedging or other professional or consulting fees directly associated with acquisitions; gains or losses resulting from resolving all pre-acquisition or divestiture contingencies; and each of the following subject to pre-established thresholds: the impact of any cumulative effect of changing to newly adopted accounting principles; operating income of acquired and divested entities and their subsidiaries as reflected on the financial records thereof; losses due to impairments or gain/loss contingencies; gains or losses on the sale of fixed assets; direct losses on Cisco’s tangible assets from natural catastrophe, war, insurrection, riot, terrorism, confiscation, expropriation, nationalization, deprivation, or seizure; and restructuring charges.

  53. Long-Term, Equity-Based Incentive Awards

    Long-Term, Equity-Based Incentive Awards The objective of Cisco’s equity-based incentive awards program is to align the interests of our executive officers with our stockholders, and to provide our executive officers with a long-term incentive to manage Cisco from the perspective of an owner. PRSUs support the objectives of linking realized value to the achievement of critical financial and operational objectives and delivering superior long-term stockholder returns. Time-based RSUs support retention and align the interests of our executive officers with those of our stockholders since they promote stockholder value creation and a culture of ownership. The Compensation Committee determines the size of an executive officer’s equity awards according to each executive officer’s position within Cisco and sets targets at levels intended to create a meaningful opportunity for reward predicated on increasing stockholder value and delivering on key long-term financial performance objectives. In addition to considering competitive market data, the Compensation Committee considers an individual’s performance history, an individual’s potential for future advancement and promotions, the CEO’s recommendations for awards other than his own, and the value of existing vested and unvested outstanding equity awards, including the extent to which such awards provide sufficient holding power for each of our executive officers. The relative weight given to each of these factors varies among individuals at the Compensation Committee’s discretion.

  54. Fiscal 2022 Awards

    Fiscal 2022 Awards In September 2021 and November 2021, the Compensation Committee approved fiscal 2022 equity awards for each named executive officer to be comprised of approximately 60% PRSUs and 40% time-based RSUs (based on grant date target value) as set forth in the table below. The year−over−year increase in the grant date target values for the fiscal 2022 equity awards of approximately $3.7 million to Mr. Robbins and approximately $2 million to Ms. Martinez was determined to be appropriate by the Compensation Committee after its consideration of the factors set forth above. Commencing with the equity awards granted in fiscal 2021, the Compensation Committee approved the accrual of dividend equivalents on PRSUs and time-based RSU awards granted to executive officers. Such dividend equivalents accrue on the awards as of each dividend payment date during the period between the date the award is granted and the date the award vests and are subject to the same terms and conditions (including, without limitation, any forfeiture conditions) as the awards to which they relate. Any dividend equivalents awarded with respect to the awards will be settled only if, when and to the extent such awards vest and are settled.

  55. Fiscal 2022 Awards

    | Named Executive Officer | Target PRSUs | Max. PRSUs | Target Value of PRSUs | Time- Based RSUs | Grant Value of Time-Based RSUs | Total Target Value of Fiscal 2022 Annual Equity Awards(1) | | Charles H. Robbins(2) | 231,058 | 346,587 | $13,907,779 | 165,862 | $9,278,830 | $23,186,609 | | R. Scott Herren | 109,671 | 164,506 | $6,600,553 | 78,727 | $4,400,052 | $11,000,605 | | Maria Martinez | 99,701 | 149,551 | $6,000,509 | 71,570 | $4,000,047 | $10,000,556 | | Jeff Sharritts | 25,607 | 38,410 | $1,541,162 | 25,607 | $1,337,981 | $2,879,143 | | Dev Stahlkopf | 59,821 | 89,731 | $3,600,331 | 42,942 | $2,400,028 | $6,000,359 | | Gerri Elliott | 99,701 | 149,551 | $6,000,509 | 71,570 | $4,000,047 | $10,000,556 |

  56. Fiscal 2022 Awards

    (1) See the “Fiscal 2022 Compensation – Long-Term, Equity-Based Incentive Awards – Target Values versus Accounting Values” section in the CD&A for information about how this value is calculated. (2) The majority of Mr. Robbins fiscal 2022 equity awards were granted in September 2021 at the same time as the other named executive officers and, as the result of an administrative matter, the remainder of his fiscal 2022 equity awards were granted in November 2021.

  57. EARNED PRSUs = TARGET PRSUs × ((50% × AVERAGE FINANCIAL GOAL MULTIPLIER) + (50% X RELATIVE TSR MULTIPLIER))

    EARNED PRSUs = TARGET PRSUs × ((50% × AVERAGE FINANCIAL GOAL MULTIPLIER) + (50% X RELATIVE TSR MULTIPLIER))

  58. Average Financial Goal Multiplier

    Average Financial Goal Multiplier The Average Financial Goal Multiplier is based on the average of Cisco’s operating cash flow and EPS over a three-year period as measured against annual performance goals that are set by the Compensation Committee at the beginning of each fiscal year. For example, in the case of the fiscal 2022 PRSU grants, at the beginning of each of fiscal 2022, 2023, and 2024, the Compensation Committee will approve certain operating cash flow and EPS goals for the applicable fiscal year. Following the completion of each fiscal year, the Compensation Committee will certify the financial goal multiplier that was earned for such year and following the completion of fiscal 2024, the Compensation Committee will determine the Average Financial Goal Multiplier for the three-year period. The uncertainty of many external factors that affect our business and industry, such as supply challenges and rising component and related costs, made it difficult to forecast operating cash flow and EPS goals beyond a one-year period. As a result, the Compensation Committee determined that the current design appropriately measures performance over the long term, as it provides effective performance goals for our named executive officers while making the final value of the fiscal 2022 PRSU grants earned contingent in part on the Average Financial Goal Multiplier over a three-year period. Operating cash flow can range from a threshold of 85% of target to a maximum of 123% of target, while EPS can range from a threshold of 85% of target to a maximum of 124% of target. EPS is weighted on a 2-to-1 basis compared to operating cash flow in calculating the outcome under the Financial Goal Multiplier. Operating cash flow and EPS at or below the threshold levels set forth below results in a Financial Goal Multiplier of 0%. Operating cash flow and EPS at or above the maximum levels set forth below results in a Financial Goal Multiplier of 150%.

  59. Relative TSR Multiplier

    Relative TSR Multiplier Following the completion of the three-year performance period, the Relative TSR Multiplier is determined and certified by the Compensation Committee by comparing Cisco’s TSR at the end of the three-year performance period to the TSR of a pre-established group of comparator companies. In the case of the fiscal 2022 PRSU grants, the performance metric for the remaining 50% of the PRSUs is Cisco’s TSR relative to the companies comprising the S&P 500 Index over a three-year period covering fiscal years 2022 through 2024. The Relative TSR Multiplier is calculated as follows:

  60. Relative TSR Multiplier

    | Relative TSR | Relative TSR Multiplier(1) | | 75th Percentile or Above | 150% | | 50th Percentile | 100% | | 25th Percentile | 50% | | Below 25th Percentile | 0% |

  61. Relative TSR Multiplier

    (1) To the extent Cisco’s relative TSR falls between two discrete points in the table above, linear interpolation shall be used to determine the Relative TSR Multiplier.

  62. Additional Promotional Equity Award to Mr. Sharritts

    Additional Promotional Equity Award to Mr. Sharritts In June 2022, the Compensation Committee approved the below grant of time-based RSUs to Mr. Sharritts in light of his promotion to Executive Vice President and Chief Customer and Partner Officer.

  63. Additional Promotional Equity Award to Mr. Sharritts

    | Named Executive Officer | Time- Based RSUs | Grant Value of Time-Based RSUs | | Jeff Sharritts | 67,782 | $3,000,031 |

  64. Earned Fiscal 2020 Awards (Fiscal 2020 – 2022)

    Earned Fiscal 2020 Awards (Fiscal 2020 – 2022) The table below summarizes the applicable Financial Goal Multipliers, Average Financial Goal Multiplier, and Relative TSR Multiplier for the PRSUs granted during fiscal 2020 and the percentage of PRSUs earned. Because Cisco’s TSR at the end of the three-year performance period was below threshold performance, the Relative TSR Multiplier for these PRSUs was 0%. (1) Earned PRSUs = Target PRSUs x ((50% x Average Financial Goal Multiplier) + (50% x Relative TSR Multiplier)). Based on the multipliers as set forth in the table above, the fiscal 2020 PRSUs (for which the three-year performance cycle has been completed) were earned as follows reflecting our commitment to pay for performance:

  65. Target Values versus Accounting Values

    Target Values versus Accounting Values Because the fiscal 2022 PRSUs include annual Financial Goal Multipliers and a three-year Relative TSR Multiplier, the values reported in the Summary Compensation Table are different than the target values set forth in the tables above. Because 50% of the value of the fiscal 2022 PRSUs are based on the Relative TSR Multiplier, FASB ASC Topic 718 requires that the value of the fiscal 2022 PRSUs reported in the “Compensation Committee Matters – Fiscal 2022 Compensation Tables – Summary Compensation Table” include the full value of the TSR component based on the probable outcome of the Relative TSR Multiplier. However, because the remaining 50% of the value of the fiscal 2022 PRSUs is based on separate measurements of our financial performance for each year in the three-year performance period, FASB ASC Topic 718 requires that the grant date fair value to be calculated at the commencement of each separate year of the performance cycle when the respective performance measures are approved. As a result, for the fiscal 2022 PRSUs, the Summary Compensation Table does not include the value of the PRSUs based on the annual financial metric goals for fiscal 2023 or fiscal 2024. Such amounts will be included as equity compensation in the Summary Compensation Table for fiscal 2023 and fiscal 2024, respectively, when the financial metrics are established. However, the Summary Compensation Table for fiscal 2022 does include a portion of the value of the fiscal 2020 PRSUs and the fiscal 2021 PRSUs based on the annual operational performance metrics set for those awards during fiscal 2022. The table below illustrates the difference between target values and accounting values for our CEO over the last three fiscal years.

  66. Vesting of RSUs and PRSUs

    Vesting of RSUs and PRSUs Consistent with typical practices among competitors for key talent in the technology sector and responsive to recruiting and retention considerations in this market, 25% of the time-based RSUs will generally vest subject to a one-year cliff and then vest 6.25% in each successive quarter thereafter over the remainder of the four-year vesting period. Subject to continued employment and the Compensation Committee’s discretion to further review and reduce the number of earned PRSUs until the settlement date, any earned PRSUs will be settled following the completion of the performance period and final certification of the Compensation Committee. All outstanding unvested equity awards under the 2005 Stock Incentive Plan will vest in full (at target levels for PRSUs), and, if applicable, become immediately exercisable in the event of the named executive officer’s death, terminal illness, or if Cisco is acquired by merger or asset sale, unless the award or related agreement is assumed or replaced by the acquiring entity.

  67. Other Fiscal 2022 Compensation

    Other Fiscal 2022 Compensation In connection with her appointment as our Executive Vice President, Chief Legal Officer and Chief Compliance Officer, in June 2021, Ms. Stahlkopf entered into a letter agreement with Cisco providing for (i) reasonable payments with an approximate value of $5.1 million to Ms. Stahlkopf designed to approximate and compensate her for the value and timing of the unvested equity and other cash compensation she forfeited by leaving her former employer and joining Cisco, which payments consisted of a $2.2 million cash bonus (the “Restoration Cash Bonus”), performance-based RSUs valued at $1.55 million (the “Restoration PRSUs”), and time-based RSUs valued at $1.55 million (the “Restoration RSUs”); and (ii) a new hire equity award with an approximate value of $2 million in the form of time-based RSUs (the “New Hire RSUs”). These equity awards are further detailed in the table below.

  68. Other Fiscal 2022 Compensation

    | Restoration and New Hire Equity Awards | Target PRSUs | Max. PRSUs | Target Value of PRSUs | Time- Based RSUs | Grant Value of Time-Based RSUs | Total Target Value of Equity Awards(1) | | Restoration PRSUs and RSUs | 25,757 | 38,635 | $1,550,189 | 27,734 | $1,550,053 | $3,100,242 | | New Hire RSUs | – | – | – | 35,785 | $2,000,024 | $2,000,024 |

  69. Other Fiscal 2022 Compensation

    (1) See the “Fiscal 2022 Compensation – Long-Term, Equity-Based Incentive Awards – Target Values versus Accounting Values” section in the CD&A for information about how this value is calculated. The Restoration Cash Bonus was paid within 30 days following Ms. Stahlkopf’s start date and remains subject to pro-rata recoupment if she voluntarily terminates her employment or if her employment is terminated for cause within 24 months of her start date. The Restoration RSUs and New Hire RSUs will vest over four years, subject to Ms. Stahlkopf’s continued service, and the Restoration PRSUs will be subject to Cisco’s achievement of the same performance goals as the fiscal 2022 awards to the other named executive officers.

  70. Retirement

    Retirement In the event of the retirement of a named executive officer, and to the extent the named executive officer meets certain retirement eligibility criteria described in the award agreement and complies with certain post-retirement assistance requirements and covenants, all PRSUs will continue to vest and any earned PRSUs, based on the satisfaction of the performance metrics, will be settled in Cisco shares at the end of the applicable three-year performance period. At the end of fiscal 2022, Mr. Robbins and Ms. Elliott were eligible for retirement vesting. Cisco believes that the retirement vesting feature of all PRSUs is appropriate and motivating because it provides protection to long-tenured named executive officers in light of the three-year PRSU performance period and is a prevalent practice among the companies within the Peer Group that grant similar equity awards with multi-year performance periods. Further, PRSUs will be forfeited and provide no value to its holder to the extent a named executive officer violates specific post-retirement covenants. See the “Compensation Committee Matters – Fiscal 2022 Compensation Tables – Grants of Plan-Based Awards – Fiscal 2022” table for additional information regarding these equity grants to the named executive officers and the “Potential Payments upon Termination or Change in Control” section for additional information regarding these grants to the named executive officers and all other outstanding equity awards previously granted to the named executive officers.

  71. Deferred Compensation Plan

    Deferred Compensation Plan The Deferred Compensation Plan is available to all U.S. employees with the title of director or above, including the named executive officers. The Deferred Compensation Plan provides an opportunity for individual retirement savings on a tax- and cost-effective basis on compensation above the Internal Revenue Code of 1986, as amended (the “Code”), limits under the Cisco Systems, Inc. 401(k) Plan (the “401(k) Plan”). Cisco does not sponsor a supplemental executive retirement plan or a defined benefit pension plan. Cisco matches deferrals at the same percentage as matched under the 401(k) Plan. Those matching contributions are described in footnote 2 to the “Compensation Committee Matters – Fiscal 2022 Compensation Tables – Nonqualified Deferred Compensation – Fiscal 2022” table below. Fiscal 2023 Compensation Approach ■ Base Salaries – Based on performance, the relevant market data, and input from Exequity regarding competitive pay, the annual base salaries will increase from $850,000 to $875,000 for each of Mr. Herren and Ms. Martinez and from $675,000 to $715,000 for Ms. Stahlkopf, effective October 24, 2022. The annual base salaries of Mr. Robbins and Mr. Sharritts were not adjusted. ■ Variable Cash Incentive Awards – Similar to fiscal 2022, awards under the EIP for the named executive officers are based on a prevalent additive formula in which 80% of the bonus is based on the risk and reward of Cisco’s financial performance while 20% is based on an ESG factor, which will be scored based on the executive leadership team’s joint execution of Cisco’s ESG strategy. The individual target awards remain at competitive levels of 260% of base salary for Mr. Robbins and 160% of base salary for the other named executive officers. ■ Long-Term, Equity-Based Incentive Awards – In the interest of maintaining Cisco’s intended competitive positioning among the peers, and of continuing the consistency of the overall incentive program design and operation, in October 2022, the Compensation Committee granted the following equity awards to the continuing named executive officers below (60% PRSUs/40% RSUs for the CEO and 50% PRSUs/50% RSUs for the other continuing named executive officers) and the PRSUs were granted using a three-year performance period and the same performance metrics that were used in fiscal 2022. However, the relative TSR performance goal for the fiscal 2023 PRSUs will modify the financial performance goal multiplier up or down by no more than 20% rather than be a separate multiplier as described above with respect to the fiscal 2022 PRSUs.

  72. Deferred Compensation Plan

    | Named Executive Officer | Performance-Based Restricted Stock Units | Time-Based Restricted Stock Units | | Charles H. Robbins | 368,446 | 262,759 | | R. Scott Herren | 165,329 | 176,857 | | Maria Martinez | 153,520 | 164,225 | | Jeff Sharritts | 118,092 | 126,327 | | Dev Stahlkopf | 100,378 | 107,378 |

  73. Deferred Compensation Plan

    We are transforming our business to meet the evolving needs of our customers and increasing the amount of subscription offerings that we provide. In fiscal 2022, total subscription revenue, including services sold as subscriptions, was $22.4 billion and represented 43% of Cisco’s total revenue. Our subscription revenue drives ARR, which is one of the best indicators of our progress in our business transformation. After evaluating potential long-term incentive designs and in order to incentivize the key drivers of the business transformation, in October 2022, the Compensation Committee granted the following one-time PRSUs using a three-year performance period and a product ARR performance metric designed to incentivize growing product ARR over the performance period. The Compensation Committee determined that product ARR growth correlates with the success of Cisco’s business transformation strategy and that the use of product ARR as the performance metric for these one-time PRSUs is appropriate as it differs from other performance metrics used by Cisco under its executive compensation program. These one-time PRSUs have three-year cliff vesting (with no retirement vesting) and are designed to retain our executive talent in a very competitive market so that they can work to deliver results against the rigorous product ARR performance goals and increase stockholder value through the successful transformation of the business over the performance period.

  74. Deferred Compensation Plan

    | Named Executive Officer | Performance-Based Restricted Stock Units | | Charles H. Robbins | 378,980 | | R. Scott Herren | 126,327 | | Maria Martinez | 126,327 | | Jeff Sharritts | 101,062 | | Dev Stahlkopf | 101,062 |

  75. Peer Group and Benchmarking

    Peer Group and Benchmarking The Compensation Committee approved a peer group in March 2021, which was used to establish compensation targets and guide decisions through April 2022. Exequity subsequently prepared a peer group study, and based on the below objective selection criteria, the same peer group was approved in April 2022. As an additional point of reference, the Compensation Committee may also decide to use data accumulated by management regarding compensation practices of companies where Cisco regularly competes for talent.

  76. How the Peer Group was Selected

    How the Peer Group was Selected The members of the Peer Group are generally based on the following objective criteria, recommended by Exequity: ■ Major information technology companies with related Global Industry Classification Standard (GICS) codes 4510, 4520, 4530, and 5020; ■ A three-year rolling average market capitalization greater than $30 billion (based on the trailing 12-quarter average); and ■ Revenues greater than $10 billion (based on the trailing four-quarter averages).

  77. Peer Group Members

    Peer Group Members

  78. Peer Group Members

    | Accenture plc | HP Inc. | Oracle Corporation | | Alphabet Inc. | Intel Corporation | Qualcomm Incorporated | | Apple Inc. | International Business Machines Corporation | salesforce.com, inc. | | Broadcom Inc. | Meta Platforms, Inc. | Visa Inc. | | Dell Technologies Inc. | Microsoft Corporation | VMware, Inc. |

  79. How We Use the Peer Group

    How We Use the Peer Group The positions of Cisco’s named executive officers were compared to their counterpart positions in the Peer Group, and the compensation levels for comparable positions in the Peer Group were examined for guidance in determining: ■ base salaries; ■ variable cash incentive awards; and ■ the amount and mix of long-term, equity-based incentive awards. The Compensation Committee establishes base salaries, variable cash incentive awards, and long-term, equity-based incentive awards on a case-by-case basis for each named executive officer taking into account, among other things, company and individual performance, role expertise, experience, and the competitive market, advancement potential, recruiting needs, internal equity, retention requirements, unrealized equity gains, succession planning, and best compensation governance practices. The Compensation Committee does not tie individual compensation to specific target percentiles.

  80. How the Compensation Committee Makes Decisions and Policies

    | Name and Principal Position(1) | Fiscal Year(1) | Salary ($)(2) | Bonus ($) | Stock Awards ($)(3) | Non-Equity Incentive Plan Compensation ($)(4) | All Other Compensation ($)(5) | Total ($) | | Charles H. Robbins Chair and Chief Executive Officer | 2022 | $1,390,000 | – | $24,866,549 | $2,941,796 | $85,591 | $29,283,936 | | | 2021 | $1,416,731 | – | $19,415,798 | $4,495,816 | $118,350 | $25,446,695 | | | 2020 | $1,390,000 | – | $19,215,141 | $2,471,976 | $94,840 | $23,171,957 | | R. Scott Herren Executive Vice President and Chief Financial Officer | 2022 | $838,461 | – | $12,457,042 | $1,091,792 | $220,984 | $14,608,279 | | | 2021 | $495,385 | $8,000,000(6) | $10,309,617 | $962,187 | $101,526 | $19,868,715 | | Maria Martinez Executive Vice President and Chief Operating Officer | 2022 | $838,461 | – | $10,600,066 | $1,091,792 | $17,163 | $12,547,482 | | | 2021 | $761,539 | – | $9,547,611 | $1,486,630 | $22,951 | $11,818,731 | | | 2020 | $700,000 | – | $6,809,059 | $754,880 | $19,510 | $8,283,449 | | Jeff Sharritts Executive Vice President and Chief Customer and Partner Officer | 2022 | $625,481 | – | $5,932,440 | $657,653 | $26,639 | $7,242,213 | | Dev Stahlkopf Executive Vice President, Chief Legal Officer and Chief Compliance Officer | 2022 | $675,000 | $2,200,000(7) | $9,506,363 | $876,698 | $19,685 | $13,277,746 | | Gerri Elliott Former Executive Vice President and Chief Customer and Partner Officer | 2022 | $743,750 | – | $11,214,292 | $924,125 | $55,675 | $12,937,842 | | | 2021 | $840,865 | – | $9,859,284 | $1,642,080 | $69,144 | $12,411,373 | | | 2020 | $825,000 | – | $8,267,815 | $902,880 | $11,672 | $10,007,367 |