DEF 14A of Aptiv PLC

Filed Mar 11, 2024 · FY20230001193125-24-064797

Open on EDGAR

ELECTION OF DIRECTORS
ELECTION OF DIRECTORS THAT the following directors be elected as directors of the Company:
ELECTION OF DIRECTORS
| 1) | Kevin P. Clark |
ELECTION OF DIRECTORS
| 2) | Nancy E. Cooper |
ELECTION OF DIRECTORS
| 3) | Joseph L. Hooley |
ELECTION OF DIRECTORS
| 4) | Vasumati P. Jakkal |
ELECTION OF DIRECTORS
| 5) | Merit E. Janow |
ELECTION OF DIRECTORS
| 6) | Sean O. Mahoney |
ELECTION OF DIRECTORS
| 7) | Paul M. Meister |
ELECTION OF DIRECTORS
| 8) | Robert K. Ortberg |
ELECTION OF DIRECTORS
| 9) | Colin J. Parris |
ELECTION OF DIRECTORS
| 10) | Ana G. Pinczuk |
EXECUTIVE COMPENSATION
| COMPENSATION COMMITTEE REPORT | | 50 | | 2023 SUMMARY COMPENSATION TABLE | | 51 | | 2023 GRANTS OF PLAN-BASED AWARDS | | 53 | | 2023 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END | | 55 | | 2023 OPTION EXERCISES AND STOCK VESTED TABLE | | 57 | | 2023 NON-QUALIFIED DEFERRED COMPENSATION | Plan Benefits | 58 | | | Investment Options | 58 | | | Deferral Election Process | 58 | | | Distributions | 58 | | | Vesting | 58 | | | 2023 Non-Qualified Deferred Compensation Table | 59 | | POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL | Employment Arrangements | 60 | | | Annual Incentive Plan | 60 | | | Long-Term Incentive Plan | 60 | | | Change in Control Plan | 61 | | | Severance Plan | 61 | | | Potential Payments upon Termination or Change in Control Table | 63 | | CEO PAY RATIO | | 65 | | 2023 PAY VERSUS PERFORMANCE TABLE | Analysis of the Information Presented in the Pay Versus Performance Table | 67 | | | Most Important Measures in Linking Compensation with Performance in Fiscal Year 2023 | 69 | | REPORT OF THE AUDIT COMMITTEE | | 70 | | INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM’S FEES | | 71 |
EXECUTIVE COMPENSATION
| APPOINTMENT OF AND PAYMENT TO AUDITORS (Resolution 11) | | 72 | | APPROVE 2024 LONG-TERM INCENTIVE PLAN (Resolution 12) | | 72 | | ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION (Resolution 13) | | 81 | | ADVISORY VOTE ON THE FREQUENCY OF AN ADVISORY VOTE TO APPROVE EXECUTIVE COMPENSATION (Resolution 14) | | 82 | | OWNERSHIP OF CERTAIN BENEFICIAL OWNERS | | 83 | | SECURITY OWNERSHIP OF MANAGEMENT | | 84 | | EQUITY COMPENSATION PLAN INFORMATION | | 85 | | RELATIONSHIPS AND RELATED PARTY TRANSACTIONS | | 86 | | OTHER INFORMATION | Presentation of Accounts | 87 | | | Other Business | 87 | | | Shareholder Proposals for the 2025 Annual Meeting | 87 | | | Householding | 87 | | | Record Date | 87 | | | Voting Prior to the Annual Meeting | 87 | | | Changing Your Vote before the Annual Meeting | 88 | | | Voting at the Annual Meeting | 88 | | | Quorum for the Annual Meeting | 88 | | | Voting Tabulation | 88 | | | Broker Non-Votes | 88 | | | Attending the Annual Meeting | 88 | | | Accessing Proxy Materials on the Internet | 89 | | | Notice and Access | 89 | | | Proxy Solicitation | 89 | | | Corporate Governance Information | 89 | | | Voting Results for the Annual Meeting | 90 | | | Requests for Copies of Annual Report | 90 | | | Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting to be Held on April 24, 2024 | 90 | | APPENDIX A | | A-1 | | APPENDIX B | | B-1 |
DIRECTOR NOMINEES
DIRECTOR NOMINEES
DIRECTOR NOMINEES
| Name | Director Since | Independent | | Kevin P. Clark | 2015 | | | Nancy E. Cooper | 2018 | | | Joseph L. Hooley | 2020 | | | Vasumati P. Jakkal | — | | | Merit E. Janow | 2021 | | | Sean O. Mahoney | 2009 | | | Paul M. Meister | 2019 | | | Robert K. Ortberg | 2018 | | | Colin J. Parris | 2017 | | | Ana G. Pinczuk | 2016 | |
(RESOLUTIONS 1 TO 10)
(RESOLUTIONS 1 TO 10) All of our current directors, other than Richard L. Clemmer, are nominated for one-year terms to serve until the 2025 annual meeting, or until such director’s earlier resignation, retirement or other termination of service. We thank Mr. Clemmer for all of his contributions over his years of service to Aptiv. The Board believes that the combination of the various qualifications, skills, and breadth and depth of experiences of the director nominees contributes to an effective and well-functioning Board. The Board and the Nominating and Governance Committee believe that, individually and as a whole, the directors possess the necessary qualifications to provide effective oversight of the business and quality advice and counsel to the Company’s management. Included in each director nominee’s biography below is an assessment of each of their specific qualifications, attributes, skills and experience. Committee memberships listed below are as of the date of this Proxy Statement. The Board has been informed that each nominee is willing to continue to serve as a director. If a director does not receive a majority of the vote for his or her election, then that director will not be elected to the Board, and the Board may fill the vacancy with a different person, or the Board may reduce the number of directors to eliminate the vacancy. Mr. Mahoney was a member of the Board prior to the Company’s initial public offering in 2011, and information included in this Proxy Statement as to his tenure on our Board reflects that service.
(RESOLUTIONS 1 TO 10)
| CHAIRMAN & CEO DIRECTOR SINCE: MARCH 2015 NON-INDEPENDENT DIRECTOR APTIV COMMITTEE MEMBERSHIPS: None | KEVIN P. CLARK | AGE: 61 Kevin P. Clark has been a director since March 2015, when he became Aptiv’s President and Chief Executive Officer. In April 2022, he was named Chairman and Chief Executive Officer. In 2014, Mr. Clark was appointed Chief Operating Officer responsible for Aptiv’s business divisions, as well as the global supply chain function. He joined Aptiv in 2010 as Chief Financial Officer, responsible for all financial activities, including strategic planning, corporate development, financial planning and analysis, treasury, accounting, and tax. Before joining Aptiv, he was a founding partner of Liberty Lane Partners, LLC, a private equity investment firm focused on investing in and building and improving middle-market companies from 2007 to 2010. He served as Chief Financial Officer of Fisher-Scientific International Inc., a manufacturer, distributor and service provider to the global healthcare market, from the company’s initial public offering in 2001 through the completion of its merger with Thermo Electron Corporation in 2006. He also held a number of senior management positions at Fisher-Scientific. He began his career in the financial organization of Chrysler Corporation. Mr. Clark has both a bachelor’s degree in financial administration and a master’s degree in finance from Michigan State University. QUALIFICATIONS: Mr. Clark is a proven leader with notable success in creating and implementing Aptiv’s business and technology strategies. As our Chairman and CEO, and former COO and CFO, he provides the Board with significant strategic, financial and industry expertise. | | | | CURRENT PUBLIC COMPANY DIRECTORSHIPS: • None | PREVIOUS PUBLIC COMPANY DIRECTORSHIPS IN LAST FIVE YEARS: • None |
(RESOLUTIONS 1 TO 10)
| ELECTION OF DIRECTORS | 11 |
(RESOLUTIONS 1 TO 10)
| DIRECTOR SINCE: FEBRUARY 2018 INDEPENDENT DIRECTOR APTIV COMMITTEE MEMBERSHIPS: Audit Committee (Chair) and Nominating and Governance Committee | NANCY E. COOPER | AGE: 70 Nancy E. Cooper has been a director since February 2018. Ms. Cooper is the former Executive Vice President and Chief Financial Officer of CA Technologies, an IT management software provider, a position she held from August 2006 until she retired in May 2011. Before joining CA, she served as the Chief Financial Officer of IMS Health, Inc. from 2001 to 2006 and as Chief Financial Officer for Reciprocal, Inc. from 2000 to 2001. She began her career at IBM Corporation in 1976, where she held positions of increasing responsibility over a 22-year period, focusing on technology strategy and financial management. Ms. Cooper has bachelor’s degrees in both economics and political science from Bucknell University and a master’s of business administration from the Harvard Graduate School of Business. QUALIFICATIONS: Ms. Cooper brings to the Board significant experience leading a global public company finance organization, and contributes leadership, financial, risk management, technology and strategy expertise. | | | | CURRENT PUBLIC COMPANY DIRECTORSHIPS: • Brunswick Corporation (Non-Executive Board Chair) | PREVIOUS PUBLIC COMPANY DIRECTORSHIPS IN LAST FIVE YEARS: • The Mosaic Company (2011 – 2021) |
(RESOLUTIONS 1 TO 10)
| DIRECTOR SINCE: JANUARY 2020 INDEPENDENT DIRECTOR APTIV COMMITTEE MEMBERSHIPS: Compensation and Human Resources Committee (Chair) and Audit Committee | JOSEPH L. HOOLEY | AGE: 66 Joseph L. (Jay) Hooley has been a director since January 2020. Mr. Hooley is the former Chairman of the Board and Chief Executive Officer of State Street Corporation, one of the world’s leading providers of financial services to institutional investors, including investment servicing, investment management and investment research and trading. He served as State Street’s Chairman from 2011 to 2019, its Chief Executive Officer from 2010 to 2018, and its President and Chief Operating Officer from 2008 to 2014. From 2002 to 2008, he served as Executive Vice President and head of State Street’s Investor Services Division, and, in 2006, he was appointed Vice Chairman and Global Head of State Street’s Investment Servicing and Investment Research and Trading. Mr. Hooley has a bachelor’s degree from Boston College. QUALIFICATIONS: Mr. Hooley’s long tenure as a public company executive leading and transforming a global financial services organization, including his extensive experience with institutional investors through his role as Chairman and CEO of State Street, provides the Board with significant expertise in management, strategic planning and corporate governance, as well as a global business perspective, and his unique background helps the Board better understand investors’ points of view and ensures those perspectives are incorporated into Board discussions with management on important strategic topics. | | | | CURRENT PUBLIC COMPANY DIRECTORSHIPS: • Exxon Mobil Corporation (Lead Independent Director) | PREVIOUS PUBLIC COMPANY DIRECTORSHIPS IN LAST FIVE YEARS: • State Street Corporation (2009 – 2019) |
(RESOLUTIONS 1 TO 10)
| 12 | ELECTION OF DIRECTORS |
(RESOLUTIONS 1 TO 10)
| DIRECTOR NOMINEE INDEPENDENT | VASUMATI P. (VASU) JAKKAL | AGE: 48 Vasumati P. (Vasu) Jakkal is Corporate Vice President of Security, Compliance, Identity & Privacy at Microsoft Corporation, a position she has held since 2020. Prior to joining Microsoft, from 2017 to 2020, she served as the Executive Vice President and Chief Marketing Officer at FireEye-Mandiant (acquired by Google), which provided hardware, software and services to investigate cybersecurity attacks and analyze IT security risks. From 2014 to 2017, Ms. Jakkal was Vice President, Corporate Marketing & Strategy at Brocade Communications Systems, Inc. (now Broadcom Inc.), a networking provider of software and hardware solutions spanning the cloud to the edge. Prior to that, she was with LSI Corporation (now Broadcom Inc.), a designer, developer, manufacturer and global supplier of semiconductor and infrastructure software products, where she served as the Chief of Staff and Technical Advisor to the CEO and COO. She began her career at Intel Corporation, where she held positions of increasing responsibility spanning engineering to general management from 1999 until 2012. Ms. Jakkal has a bachelor’s degree in electrical engineering from the College of Engineering, Pune (India) and a master’s degree in electrical engineering from the University of Minnesota. QUALIFICATIONS: Ms. Jakkal has over 20 years of technology experience across cybersecurity, cloud, IOT, AI and mobility, which will provide the Board with critical expertise as Aptiv accelerates its innovation in and commercialization of new mobility and connectivity technologies across industries. | | | | CURRENT PUBLIC COMPANY DIRECTORSHIPS: • None | PREVIOUS PUBLIC COMPANY DIRECTORSHIPS IN LAST FIVE YEARS: • None |
(RESOLUTIONS 1 TO 10)
| DIRECTOR SINCE: APRIL 2021 INDEPENDENT DIRECTOR APTIV COMMITTEE MEMBERSHIPS: Compensation and Human Resources Committee and Nominating and Governance Committee | MERIT E. JANOW | AGE: 65 Merit E. Janow has been a director since April 2021. Professor Janow is the former Dean of the Faculty from 2013 to 2021 and is currently Professor of Practice in the School of International and Public Affairs (SIPA) at Columbia University, a position she has held since 1993. Previously, she directed the graduate program in international finance and economic policy. She regularly teaches graduate courses in international economic policy and law, at both SIPA and Columbia Law School. She has published numerous articles and several books. Professor Janow has had three periods of government service, serving as one of seven members of the Appellate Body of the World Trade Organization from 2003 to 2007, as the Executive Director of the International Competition Policy Advisory Committee of the U.S. Department of Justice’s Antitrust Division from 1997 to 2000, and as Deputy Assistant U.S. Trade Representative for Japan and China from 1990 to 1993. She served on the Board of Directors and as Chair of the Nasdaq Stock Markets LLC of the Nasdaq OMX Group from 2005 to 2016. Professor Janow has a bachelor’s degree in Asian Studies from the University of Michigan and a juris doctorate degree from Columbia Law School. QUALIFICATIONS: Professor Janow’s extensive knowledge and experience in international trade, economics, policy and regulatory matters provide valuable insight to the Company given the global nature of our business, and she particularly contributes meaningful perspective on the Asia Pacific region, as a result of her background and experience. | | | | CURRENT PUBLIC COMPANY DIRECTORSHIPS: • Mastercard Inc. (Non-Executive Board Chair) | PREVIOUS PUBLIC COMPANY DIRECTORSHIPS IN LAST FIVE YEARS: • Trimble Inc. (2008 – 2021) |
(RESOLUTIONS 1 TO 10)
| ELECTION OF DIRECTORS | 13 |
(RESOLUTIONS 1 TO 10)
| DIRECTOR SINCE: NOVEMBER 2009 INDEPENDENT DIRECTOR APTIV COMMITTEE MEMBERSHIPS: Finance Committee (Chair) and Nominating and Governance Committee | SEAN O. MAHONEY | AGE: 61 Sean O. Mahoney has been a director since November 2009. Mr. Mahoney is a private investor with over three decades of experience in investment banking and finance. He spent 17 years in investment banking at Goldman, Sachs & Co. from 1987 to 2004, where he was a partner and head of the Financial Sponsors Group, followed by four years at Deutsche Bank Securities, where he served as Vice Chairman, Global Banking from 2004 to 2008. During his banking career, he acted as an advisor to companies across a broad range of industries and product areas. Mr. Mahoney has a bachelor’s degree from the University of Chicago and a master’s degree from Oxford University, where he was a Rhodes Scholar. QUALIFICATIONS: Through his many years of experience in investment banking and finance, Mr. Mahoney provides the Board with expertise in value-creation and business strategy, capital markets, financing, and mergers and acquisitions. | | | | CURRENT PUBLIC COMPANY DIRECTORSHIPS: • None | PREVIOUS PUBLIC COMPANY DIRECTORSHIPS IN LAST FIVE YEARS: • Howmet Aerospace Inc. (formerly Arconic Inc. and Alcoa Inc.) (2016 – 2020) • iHeartMedia, Inc. (2019 – 2021) |
(RESOLUTIONS 1 TO 10)
| LEAD INDEPENDENT DIRECTOR DIRECTOR SINCE: JULY 2019 APTIV COMMITTEE MEMBERSHIPS: Compensation and Human Resources Committee, Finance Committee and Nominating and Governance Committee (Chair) | PAUL M. MEISTER | AGE: 71 Paul M. Meister has been a director since July 2019 and our Lead Independent Director since April 2022. Mr. Meister is a partner in Novalis LifeSciences, a Life Science focused venture firm and is also co-founder, and Chief Executive Officer of Liberty Lane Partners, LLC, a private investment company with investment holdings in healthcare, technology and distribution-related industries. From 2014 to 2018, he was President of MacAndrews & Forbes Incorporated, a private company that owns or controls a diverse set of businesses. During 2018, he also served, on an interim basis, as Executive Vice Chairman of Revlon, Inc. a leading beauty products company. He served from 2010 to 2014 as Chairman and Chief Executive Officer of inVentiv Health (now Syneos Health), a leading provider of commercial, consulting and clinical research services to the pharmaceutical and biotech industries. He was Chairman of Thermo Fisher Scientific, Inc, a scientific instruments equipment and supplies company, from November 2006 to April 2007. He was previously an Executive Officer of Fisher Scientific International, Inc., a predecessor of Thermo Fisher Scientific from 1991 to 2006. Mr. Meister has a bachelor’s degree from the University of Michigan and a master’s of business administration degree from Northwestern University. QUALIFICATIONS: Mr. Meister’s extensive public company experience, as both an executive and a board member, provides the Board with significant expertise in management, strategy, finance and capital markets, operations, and mergers and acquisitions. | | | | CURRENT PUBLIC COMPANY DIRECTORSHIPS: • Amneal Pharmaceuticals, Inc. (Non-Executive Chair) • Quanterix Corporation | PREVIOUS PUBLIC COMPANY DIRECTORSHIPS IN LAST FIVE YEARS: • Oaktree Acquisition Corp.I (2019 – 2021) • Oaktree Acquisition Corp.II (2020 – 2022) • Scientific Games Corporation (2012 – 2020) |
(RESOLUTIONS 1 TO 10)
| 14 | ELECTION OF DIRECTORS |
(RESOLUTIONS 1 TO 10)
| DIRECTOR SINCE: SEPTEMBER 2018 INDEPENDENT DIRECTOR APTIV COMMITTEE MEMBERSHIPS: Audit Committee and Innovation and Technology Committee | ROBERT K. ORTBERG | AGE: 63 Robert K. (Kelly) Ortberg has been a director since September 2018. Mr. Ortberg is the former Chief Executive Officer of Collins Aerospace, a United Technologies company, a position he held from December 2018 to February 2020. Following his retirement from Collins Aerospace, he served as a Special Advisor to the office of the Chief Executive Officer for RTX Corporation (formerly Raytheon Technologies Corporation), an aerospace and defense company that provides advanced systems and services for commercial, military and government customers worldwide until March 2021. He previously served at Rockwell Collins, Inc. as its Chairman, President and Chief Executive Officer from 2015 to 2018; President and CEO from 2013 to 2015 and President from 2012 to 2013; Executive Vice President, Chief Operating Officer, Government Systems from 2010 to 2012; and Executive Vice President, Chief Operating Officer of Commercial Systems from 2006 to 2010. Before taking on those roles, he held other executive positions at Rockwell Collins, which he joined in 1987. Mr. Ortberg has a bachelor’s degree in mechanical engineering from the University of Iowa. QUALIFICATIONS: Mr. Ortberg brings to the Board a track record of operational and technology leadership, global management, accelerating company growth and creating shareholder value, coupled with a strong background in transformation and innovation and more than 30 years of experience in aerospace and defense. | | | | CURRENT PUBLIC COMPANY DIRECTORSHIPS: • RTX Corporation (formerly Raytheon Technologies Corporation) | PREVIOUS PUBLIC COMPANY DIRECTORSHIPS IN LAST FIVE YEARS: • None |
(RESOLUTIONS 1 TO 10)
| DIRECTOR SINCE: DECEMBER 2017 INDEPENDENT DIRECTOR APTIV COMMITTEE MEMBERSHIPS: Audit Committee and Innovation Technology Committee (Chair) | COLIN J. PARRIS | AGE: 62 Colin J. Parris has been a director since December 2017. Dr. Parris currently serves as the Senior Vice President and Chief Technology Officer at GE Digital, a position he has held since May 2020. He joined General Electric in 2014 as the Vice President, GE Software Research. Before joining GE, he spent two decades at IBM in a variety of executive roles, serving most recently as Vice President, Systems Research in the IBM T.J. Watson Research Division from 2013 to 2014 and General Manager for IBM’s Power Systems business from 2010 to 2013. Dr. Parris has a bachelor’s degree in electrical engineering from Howard University, master’s degrees in electrical engineering and computer science from the University of California, Berkeley, and a master’s degree in management from Stanford University. He also has a Ph.D in electrical engineering from the University of California, Berkeley. QUALIFICATIONS: Dr. Parris has an extensive technology background with significant experience in software and leading digital transformations. His deep technology background and current focus on data software and artificial intelligence provides valuable knowledge and relevant insight to the Board. | | | | CURRENT PUBLIC COMPANY DIRECTORSHIPS: • None | PREVIOUS PUBLIC COMPANY DIRECTORSHIPS IN LAST FIVE YEARS: • None |
(RESOLUTIONS 1 TO 10)
| ELECTION OF DIRECTORS | 15 |
(RESOLUTIONS 1 TO 10)
| DIRECTOR SINCE: NOVEMBER 2016 INDEPENDENT DIRECTOR APTIV COMMITTEE MEMBERSHIPS: Finance Committee and Innovation Technology Committee | ANA G. PINCZUK | AGE: 60 Ana G. Pinczuk has been a director since November 2016. Ms. Pinczuk joined Dexterity, Inc., a company that has created robots for logistics, warehouses and supply chain customers, in December 2022 as its Chief Operating Officer. From August 2019 to July 2022, Ms. Pinczuk served as the Chief Development Officer for Anaplan, Inc., which provides a cloud-based connected planning platform that helps connect organizations and people to make better and faster decisions. She joined Anaplan in February 2019 as Chief Transformation Officer. Before that she held the following positions from 2015 to 2018: President of Hewlett Packard Enterprise’s Pointnext technology services organization; Executive Vice President and Chief Product Officer of Veritas Technologies LLC, a data management provider specializing in information protection, availability and insight solutions; and Senior Vice President and General Manager of Backup and Recovery for Symantec Corporation. From 2000 to 2015, Ms. Pinczuk served in various executive positions at Cisco Systems, Inc., including Senior Vice President, Sales from 2014 to 2015; Senior Vice President, Services Transformation and Chief Operating Officer from 2013 to 2014; and Vice President, Global Technical Services from 2009 to 2013. Before joining Cisco, she spent 15 years with AT&T, Inc., in positions of increasing responsibility. Ms. Pinczuk has both a bachelor’s degree and a master’s degree in mechanical engineering from Cornell University, an executive master’s degree in technology management from the Wharton School of the University of Pennsylvania and a master’s degree in software management from Carnegie Mellon University. QUALIFICATIONS: Ms. Pinczuk’s broad technology and commercial experience spans mobile, IP networking, software, data storage and security, making her a strong contributor to the Board as Aptiv accelerates its innovation in and commercialization of new mobility technologies. | | | | CURRENT PUBLIC COMPANY DIRECTORSHIPS: • SentinelOne, Inc. | PREVIOUS PUBLIC COMPANY DIRECTORSHIPS IN LAST FIVE YEARS: • Five9, Inc. (2021 – 2023) • KLA-Tencor Corporation (2018 – 2019) |
(RESOLUTIONS 1 TO 10)
| | THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” EACH OF THE 10 DIRECTOR NOMINEES NAMED ABOVE. IF YOU COMPLETE THE ENCLOSED PROXY CARD, UNLESS YOU DIRECT OTHERWISE ON THAT CARD, THE SHARES REPRESENTED BY THAT PROXY WILL BE VOTED FOR THE ELECTION OF ALL 10 NOMINEES. |
(RESOLUTIONS 1 TO 10)
| 16 | BOARD PRACTICES |
(RESOLUTIONS 1 TO 10)
| | Board Practices |
(RESOLUTIONS 1 TO 10)
| BOARD AND GOVERNANCE INFORMATION The Company is committed to good corporate governance, which we believe is important to the success of our business and to advancing shareholder interests. Highlights include: |
Board Independence and Accountability
Board Independence and Accountability
Board Independence and Accountability
| Board Independence | | 9 of 10 director nominees are independent. Our Chairman and Chief Executive Officer is the only non-independent director. | | Board Leadership | | Current Board leadership structure is comprised of our Chairman and a strong Lead Independent Director, who provides independent Board leadership, based on robust and clearly delineated responsibilities. | | Board Engagement | | Attendance: • All directors attended more than 75% of Board and their respective Committee meetings in 2023. • All director nominees are expected to attend the Annual Meeting. Independent directors meet in executive session at every regular Board and Board Committee meeting. | | Board Composition and Diversity | | Directors have a diversity of experience that spans a broad range of industries. Directors have a broad array of attributes and skills directly relevant to the Company. 5 of our 10 director nominees are female and/or racially/ethnically diverse. No director should stand for election if the director has reached age 75, unless the Board determines that such director’s continued service is in the Company’s interest. | | Board Committees | | Fully independent Audit, Compensation and Human Resources, Finance, Innovation and Technology and Nominating and Governance Committees. Each Committee has a written charter that is reviewed annually and is available on our website. | | Board Accountability | | Annual elections of all directors. Majority voting standards for election of directors. Annual Say-on-Pay vote. Annual shareholder ratification of the Audit Committee’s selection of our independent auditor. Code of Ethical Business Conduct applies to all directors and employees. | | Responsiveness to Shareholders and Shareholder Engagement | | Following each Annual Meeting, the appropriate Committees of the Board consider the vote outcomes of the management and shareholder proposals and, depending on those vote outcomes, may recommend proposed courses of action. Directors are committed to meaningful engagement, communication and transparency with shareholders and welcome their input and suggestions, to better understand shareholders’ perspectives about Aptiv. Board members meet with top shareholders for conversations focused on a variety of topics, including strategic initiatives and sustainability, human capital matters and governance matters, when appropriate. |
Board Independence and Accountability
| BOARD PRACTICES | 17 |
Board Independence and Accountability
| Stock Ownership | | Non-employee directors are subject to robust stock ownership guidelines of $600,000 in Aptiv shares, representing 5X the annual maximum cash retainer. No hedging/no pledging. |
DIVERSITY, SKILLS AND EXPERIENCE OF OUR DIRECTOR NOMINEES
DIVERSITY, SKILLS AND EXPERIENCE OF OUR DIRECTOR NOMINEES The table below summarizes some of the experience, qualifications, attributes and skills of our director nominees. This high-level summary is not intended to be an exhaustive list of each of our director nominee’s skills or contributions to the Board; we look to directors to be knowledgeable in these areas as it relates to Aptiv. We have identified below the areas in which each director has specific expertise or prominence that he or she brings to the Board. Further information on each director nominee, including some of each of their specific experience, qualifications, attributes or skills is set forth in the biographies in “Election of Directors” above.
DIVERSITY, SKILLS AND EXPERIENCE OF OUR DIRECTOR NOMINEES
| BOARD PRACTICES | 21 |
COMMUNICATIONS WITH THE BOARD OF DIRECTORS
| DIRECTOR COMPENSATION | 27 |
COMMUNICATIONS WITH THE BOARD OF DIRECTORS
| | Director Compensation |
BOARD COMPENSATION
BOARD COMPENSATION Our directors (other than Mr. Clark, who does not receive additional compensation for his Board service) received the following annual compensation for service in 2023, which is paid in cash and time-based restricted stock units (“RSUs”). For 2023, each non-employee director was entitled to receive annual compensation in the amount of $300,000. In addition, the Lead Independent Director was entitled to receive additional annual compensation of $50,000. Also, Chairs of our Board Committees received the following additional annual compensation:
BOARD COMPENSATION
Each director may elect, on an annual basis, to receive 60%, 80% or 100% of his or her compensation in RSUs, with the remainder paid in cash. An annual grant of RSUs is made on the day of the Annual Meeting, which vests on the day before the next annual meeting. Cash compensation is paid quarterly. Any director who joins the Board, other than in connection with the Annual Meeting, will receive prorated cash compensation and a prorated grant of RSUs, based on the date the director joins the Board. These RSUs vest on the day before the next annual meeting. The table below shows cash and equity compensation paid to each member of the Board in 2023:
2023 DIRECTOR COMPENSATION
2023 DIRECTOR COMPENSATION
2023 DIRECTOR COMPENSATION
| Name | Fees Earned or Paid in Cash ($) | Stock Awards ($)(1) | Total ($) | | Richard L. Clemmer | $90,000 | $180,005 | $270,005 | | Nancy E. Cooper | 132,000 | 198,006 | 330,006 | | Joseph L. Hooley | — | 325,038 | 325,038 | | Merit E. Janow | 105,000 | 180,005 | 285,005 | | Sean O. Mahoney | 128,000 | 192,040 | 320,040 | | Paul M. Meister | — | 370,090 | 370,090 | | Robert K. Ortberg | 120,000 | 180,005 | 300,005 | | Colin J. Parris | 126,000 | 192,040 | 318,040 | | Ana G. Pinczuk | — | 300,043 | 300,043 |
2023 DIRECTOR COMPENSATION
| (1) Reflects the grant date fair value of the equity awards granted to directors on April 26, 2023, which was the date of grant for all directors. The values set forth in the table were determined in accordance with FASB ASC Topic 718. For assumptions used in determining the fair value of the awards, see Note 21. Share-Based Compensation to the Consolidated Financial Statements in our Annual Report on Form 10-K for the fiscal year ended December 31, 2023. As of December 31, 2023, all outstanding Aptiv RSU awards held by our directors were unvested; they vest in full on April 23, 2024. The year-end RSU balances for our directors are: |
2023 DIRECTOR COMPENSATION
| 28 | DIRECTOR COMPENSATION |
2023 DIRECTOR COMPENSATION
| Name | Unvested RSUs 12/31/2023 | | Richard L. Clemmer | 1,750 | | Nancy E. Cooper | 1,925 | | Joseph L. Hooley | 3,160 | | Merit E. Janow | 1,750 | | Sean O. Mahoney | 1,867 | | Paul M. Meister | 3,598 | | Robert K. Ortberg | 1,750 | | Colin J. Parris | 1,867 | | Ana G. Pinczuk | 2,917 |
2023 DIRECTOR COMPENSATION
| COMPENSATION DISCUSSION AND ANALYSIS | 29 |
2023 DIRECTOR COMPENSATION
| | Compensation Discussion and Analysis |
CEO REALIZED PAY AND OUR PERFORMANCE
| • | The chart above depicts the Target value of performance-based RSUs granted in 2021. The Realized value represents the value of the 2021 performance-based RSUs that vested on December 31, 2023. |
CEO REALIZED PAY AND OUR PERFORMANCE
| • | Target value reflects 44,910 target performance-based RSUs multiplied by grant date closing share price of $149.84. |
CEO REALIZED PAY AND OUR PERFORMANCE
| • | Realized value of the performance-based RSUs represents a share price of $89.72 as of December 31, 2023 with a performance factor of 86%, as described in the “2021-2023 Performance-Based RSUs” discussion below. |
COMPENSATION GOVERNANCE AND ALIGNMENT WITH SHAREHOLDERS
| | Pay for Performance | More Information On Page | | | 91% of 2023 total target annual compensation for the CEO is at risk and 78% is granted in equity; on average, 83% of 2023 total target annual compensation for the other NEOs is at risk and 65% is granted in equity. | 37 | | | We use a structured goal-setting process for performance incentives, with multiple levels of review including the Compensation Committee, its consultant and senior management. | 38 | | | NEOs’ annual incentives are typically based on achievement of multi-faceted financial and strategic annual performance goals. | 38 | | | 60% of the NEOs’ long-term incentive compensation consists of performance-based RSUs, which deliver value based on achievement of multi-year financial and relative TSR goals. | 43 | | | We review and analyze our pay-for-performance alignment on an annual basis, both in absolute terms and relative to our peer group. | — |
COMPENSATION GOVERNANCE AND ALIGNMENT WITH SHAREHOLDERS
| | Compensation Governance | More Information On Page | | | We actively engage with our shareholders to discuss governance and executive compensation matters. | 34 | | | We maintain reasonable severance practices in line with market practices, including double-trigger change in control provisions. | 45 | | | We maintain stock ownership guidelines for our NEOs and directors. | 46 | | | We maintain insider trading, comprehensive clawback, anti-hedging and anti-pledging policies. | 46 | | | We offer no excise tax gross-ups to our NEOs. | 47 | | | Our Compensation Committee utilizes an independent compensation consultant. | 47 | | | Our compensation programs are designed to discourage imprudent risk. | — |
EXECUTIVE COMPENSATION PHILOSOPHY AND STRATEGY
| • | Emphasize a pay-for-performance culture by linking incentive compensation to defined short- and long-term performance goals; |
EXECUTIVE COMPENSATION PHILOSOPHY AND STRATEGY
execution and our sustainability efforts at numerous conferences and roadshows, in addition to Company-hosted events and quarterly conference calls; in particular, in 2023, the Company hosted 290 investor calls, 13 investor conferences and 19 marketing/non-deal roadshow events. We have also shared financial and sustainability information relevant to our shareholders through our Sustainability Report, our Investor Relations website, our Annual Report and this Proxy Statement. 2023 Peer Group Analysis. We use a group of peer companies to compare NEO compensation to market. The Compensation Committee reviews and determines the composition of our peer group on an annual basis, with input from its independent compensation consultant and management. Aptiv’s 2023 peer group (referenced for purposes of 2023 compensation decisions) consisted of the following companies, whose aggregate profile was comparable to Aptiv in terms of size, industry, operating characteristics and competition for executive talent:
EXECUTIVE COMPENSATION PHILOSOPHY AND STRATEGY
No changes were made to the peer group referenced for purposes of our 2023 compensation decisions. In 2023, target total direct compensation among our NEOs, on average, was positioned within what we view as a competitive range of the peer group. In addition to the competitive market reference provided by our 2023 peer group, the Compensation Committee periodically uses supplemental market references from the technology sector for select roles to help prioritize building the leadership and technology skills within Aptiv that are fundamental to our ability to achieve our long-term strategy. One of the areas of highest focus has been on strengthening our product management, software development, artificial intelligence and machine learning, and systems engineering expertise. These skills are crucial to the development and deployment of next generation applications, cloud-native software, and sensor-to-cloud connectivity platforms which enable vehicles to efficiently evolve and improve over time. These capabilities are accelerating the commercialization of our Smart Vehicle Architecture (“SVA”) and other future full-systems solutions. These supplemental market references serve as an additional resource for the Compensation Committee to evaluate certain compensation decisions, where appropriate.
2023 COMPENSATION PROGRAM OVERVIEW
| Element | Key Features | Relationship to Strategic Objectives | | | | | | Annual Base Salary | • Commensurate with job responsibilities, individual performance, experience, market competitiveness and talent market dynamics • Reviewed on an annual basis for market competitiveness and individual performance | • Attract and retain key executives by providing market-competitive fixed compensation | | Annual Incentive Plan Awards | • Compensation Committee approves an incentive design for each performance period based on selected financial, operational and strategic metrics • Each executive is granted a target award opportunity based upon job responsibilities, individual performance, experience, market competitiveness and talent market dynamics • Payouts can range from 0% to 200% of target and are determined by achievement of pre-established financial goals and strategic objectives | • Pay-for-performance and encourages accountability by rewarding achievement of corporate objectives • Align executive and shareholder interests • Motivate the pursuit of specific business goals that drive long-term value creation • Drive our current and future platforms and Aptiv’s sustainability commitments through strategic goals • Attract, retain and motivate key executives with market-competitive incentive compensation opportunities | | Long-Term Incentive Plan Awards | • Target award granted commensurate with job responsibilities, individual performance, experience, market competitiveness and talent market dynamics • Grant RSU awards, 60% of which are earned based upon achievement of Company performance goals, including multi-year financial and relative TSR targets, and 40% of which vest over time | • Pay-for-performance and encourages accountability by rewarding achievement of corporate objectives • Align executive and shareholder interests • Attract, retain and motivate key executives with market-competitive incentive compensation opportunities • Utilize multi-year vesting period and multiple metrics aligned to long-term shareholder value creation, including stock price performance | | | | | | Retirement Programs | • Qualified defined contribution plan available to all U.S. salaried employees, including NEOs • Non-qualified defined contribution plan available to eligible U.S. employees, including NEOs, that allows for contributions that exceed statutory limits under our qualified defined contribution plan | • Attract and retain key executives with market-competitive compensation opportunities that foster long-term savings opportunities |
2023 COMPENSATION PROGRAM OVERVIEW
| | 2023 TARGET ANNUAL TOTAL DIRECT COMPENSATION MIX FOR CEO AND OTHER NEOS* Base salary and annual and long-term incentive award opportunities (all as more fully described below) are the elements of our NEOs’ total direct compensation. A majority of each NEO’s total direct compensation opportunity is comprised of performance-based (“at-risk”) pay, in line with the Company’s compensation philosophy. The payouts of our annual incentive awards and the performance-based components of our long-term incentive awards are dependent on the achievement of specified performance goals. All our RSU awards, both time-based and performance-based, are aligned with Company performance, as the final value realized is based on the Company’s share price. | |
2023 COMPENSATION PROGRAM OVERVIEW
| 2023 NEO Target Total Direct Compensation Opportunities The following table depicts 2023 target annual total direct compensation opportunities for the NEOs. This table reflects base salary, plus Annual and Long-Term Incentive Plan target award values, and therefore uses different valuation methodologies from those required for purposes of the “2023 Summary Compensation Table” under applicable SEC rules. Further, this table does not include information regarding changes in pension value and in non-qualified deferred compensation earnings, information regarding all other compensation or certain additional footnote disclosure, each as required to be presented in the “2023 Summary Compensation Table” under the rules of the SEC. As such, this table should not be viewed as a substitute for the “2023 Summary Compensation Table”. | | | | | | Name | Base Salary ($)(1) | Annual Incentive Target Award ($) | Long-Term Incentive Plan Target Annual Award ($) | Total Direct Compensation ($)(2) | | Kevin P. Clark Chairman and Chief Executive Officer | $1,462,272 | $2,193,408 | $13,000,000 | $16,655,680 | | Joseph R. Massaro Chief Financial Officer and Senior Vice President, Business Operations | 1,275,000 | 1,593,750 | 5,750,000 | 8,618,750 | | William T. Presley Senior Vice President and Chief Operating Officer, and President, Signal & Power Solutions | 900,000 | 900,000 | 3,500,000 | 5,300,000 | | Obed D. Louissaint Senior Vice President and Chief People Officer | 750,000 | 750,000 | 3,000,000 | 4,500,000 | | Benjamin Lyon Senior Vice President and Chief Technology Officer | 800,000 | 800,000 | 2,900,000 | 4,500,000 | | Katherine H. Ramundo Senior Vice President, Chief Legal Officer, Chief Compliance Officer and Secretary | 775,000 | 775,000 | 2,300,000 | 3,850,000 | | (1) Reflects base salary rates as of April 1, 2023. (2) This table does not reflect the value of new hire awards for Messrs. Louissaint and Lyon, and a special award for Ms. Ramundo, which are discussed below. | | | | |
2023 ANNUAL COMPENSATION DETERMINATION
2023 Annual Incentive Plan Awards. Our Annual Incentive Plan is designed to motivate our NEOs to drive profitable growth, including earnings and cash flow, and our strategic priorities by measuring the NEOs’ performance against our goals. The Compensation Committee establishes the individual annual incentive target for each NEO at a market competitive level, based on the NEO’s position, individual performance, and the scope of his or her responsibilities. As designed, payouts based on the metrics described below can range from 0% to 200% of each NEO’s annual incentive target. The Compensation Committee, working with management and its independent compensation consultant, sets the performance metrics and objectives based on Aptiv’s annual business objectives. For 2023, each NEO’s award payout was designed to be determined as follows:
NEO AIP Weighting
NEO AIP Weighting Financial Performance Objectives (75% Weighting). For 2023, financial performance objectives were based on the following metrics, which measure our overall financial performance in support of our business strategy:
NEO AIP Weighting
| Weighting (%) Performance Metrics | 75% Financial | Rationale | | Adjusted Net Income (NI)(1) | 25% | Adjusted NI provides a measure of our underlying earnings and serves as an indicator of our overall financial performance | | Cash Flow Before Financing (CFBF)(2) | 25% | CFBF measures the generation of cash required to gain scale in our current platforms and to pursue future platforms | | Growth Over Market (GOM) | 25% | GOM measures sales growth relative to the markets in which we operate and supports the conversion of bookings to revenue |
NEO AIP Weighting
| (1) Adjusted NI represents net income attributable to Aptiv before restructuring and other special items, including the tax impact thereon. |
NEO AIP Weighting
| (2) CFBF represents cash provided by (used in) operating activities plus cash provided by (used in) investing activities, adjusted for the purchase price of business acquisitions and other transactions, the cost of significant technology investments and net proceeds from the divestiture of discontinued operations and other significant businesses. |
NEO AIP Weighting
Performance Goal Setting. The NI, CFBF and GOM goals and the award payout levels related to the achievement of those goals are measured on a performance scale set by the Compensation Committee. Performance below the minimum threshold for a metric would result in no payout for that metric, and performance above the maximum level for a metric would be capped at a maximum total payout of 200% of target with respect to that metric. The Compensation Committee consistently sets performance targets that are rigorous and aligned with Aptiv’s three-year goal planning process and commitments to operational excellence. Our Annual Incentive Plan target goals, approved by the Compensation Committee, are generally established to reflect our focus on growth over prior year actual outcomes and above market growth in the performance period. Aptiv’s targeted levels of performance continue to reflect rigorous hurdles taking into account the challenging macroeconomic outlook and consistent with our goal of delivering exceptional operational performance. Given the ongoing market uncertainty and the goal-setting challenges associated with macroeconomic headwinds in January 2023, the Compensation Committee determined that the 2023 Annual Incentive Plan would include the following design changes:
NEO AIP Weighting
| COMPENSATION DISCUSSION AND ANALYSIS | 41 |
NEO AIP Weighting
| • | The Compensation Committee widened the performance ranges by lowering the threshold performance level and increasing the maximum performance level. To balance the impact of these changes, the Committee lowered the possible payout for threshold performance from 40% to 25%. The Committee made these adjustments because in an uncertain market environment, executive leadership stability is paramount. |
NEO AIP Weighting
| • | The Compensation Committee approved financial targets for two consecutive six-month financial performance periods, with one payout at the end of the fiscal year to address near-term macroeconomic and supply chain headwinds. The Compensation Committee believed that this structure would enhance visibility for goal setting purposes over a shorter horizon within the framework of the Board-approved annual financial plan. The Compensation Committee established performance criteria for the first half of 2023 (“H1 23”) and for the second half of 2023 (“H2 23”). Both H1 23 and H2 23 performance targets were consistent with the Board-approved annual financial plan. Despite the momentum in the business in the first half of 2023, during which Aptiv delivered results exceeding the H1 23 targets, the United Automobile Workers strike and subsequent vehicle production slow down created a more challenging performance environment in the second half of 2023, which impacted the Company’s financial results, as depicted in the table below. |
NEO AIP Weighting
The 2023 corporate financial performance goals and results by metric for each of the two financial performance periods were:
NEO AIP Weighting
| Performance Metric* | Performance Period | Threshold 25% Payout | Target 100% Payout | Maximum 200% Payout | Achievement | | Adjusted Net Income (NI) | H1 23 | | | Actual: $434M | 200% | | | | | | | | | | | $222M | $332M | $425M | | | | H2 23 | | Actual: $691M | | 99% | | | | | | | | | | | $463M | $695M | $888M | | | Cash Flow Before Financing (CFBF) | H1 23 | | | Actual: ($197M) | 200% | | | | | | | | | | | ($423M) | ($282M) | ($220M) | | | | H2 23 | Actual: $946M | | | 74% | | | | | | | | | | | $713M | $1,070M | $1,367M | | | Growth Over Market (GOM) | H1 23 | | | Actual: 7.5% | 185% | | | | | | | | | | | 3.6% | 5.4% | 7.8% | | | | Actual: (1.3%) | | | | 0% | | | H2 23 | | | | | | | | 3.6% | 5.4% | 7.8% | | | Financial Performance (% of Target) | | | | | 126% |
NEO AIP Weighting
| * For purposes of the Adjusted NI calculated results under the Annual Incentive Plan, to maintain the program rigor, the results shown in Appendix A of our Proxy Statement were adjusted to remove income earned by the Company on incremental sales volumes that were not anticipated at the start of the performance period and not included in the original target. For purposes of the Cash Flow Before Financing calculated results under the Annual Incentive Plan, the results shown in Appendix A of our Proxy Statement were adjusted to remove the impact of M&A activity and incremental sales volumes that were not anticipated and were not part of the original performance target. |
NEO AIP Weighting
| 42 | COMPENSATION DISCUSSION AND ANALYSIS |
NEO AIP Weighting
Strategic Results Metric (25% Weighting). In January 2023, the Compensation Committee decided to shift achievement on our strategic initiatives from a +/- 10% modifier (a design feature in previous Annual Incentive Plan performance periods) to a 25% weighted metric (“Strategic Results Metric”) for 2023 to reinforce the importance of our strategic goals in executing on our business strategy. The strategic goals under the Strategic Results Metric fall under the following three pillars and align with our broader strategic framework, including our sustainability program, and are intended to motivate focus across the organization on specific goals that drive long-term value creation. Aptiv’s strategic goals are reviewed with the same rigor and processes as the quantitative goal-setting described above, because these strategic goals are important to our ability to drive shareholder value creation. Based on its holistic evaluation of our performance against our pre-established strategic goals, the Compensation Committee determined that a payout factor of 80% of target reflected the progress made and challenges faced in 2023 in relation to our Strategic Results Metric, as set forth in more detail below.
NEO AIP Weighting
| Strategic Results Metric | | | Business Foundation | | | • Substantial enhancement in the transparency and depth of our supply chain, to manage risk proactively, as well as respond more effectively to unforeseen risk events. • Made progress in increasing leadership diversity, improving high performer retention and employee engagement, and scaling employee resource groups. Earned recognition from several external publications as a top employer. | | | Current Platforms | | | • Exceeded bookings targets, with key awards across geographies and customers to gain momentum with deliverables and SVA bookings. • Achieved development milestones for power electronics and key software products. | | | Future Platforms | | | • Integrated Wind River, progressed on synergy targets, cross business product development, internal usage of Wind River Studio, and growth of Wind River revenue. | | | • Achieved development milestones for Aptiv software architecture; increased bookings pipeline; on-track with product roadmaps for ADAS, cockpit and middleware. | | | Strategic Results Metric (% of Target) | 80% |
NEO AIP Weighting
| COMPENSATION DISCUSSION AND ANALYSIS | 43 |
NEO AIP Weighting
2023 Annual Incentive Plan Payouts. The 2023 Annual Incentive Plan payouts for our CEO and other NEOs were based 75% on corporate financial performance and 25% on strategic goals. Initial Calculated Results. In determining the final payouts, the Compensation Committee evaluated our financial performance against identified threshold, target and maximum levels of corporate financial performance goals, which resulted in a calculated score of 126% of the target described above. Our Strategic Results Metric payout factor of 80% of target was determined by the Compensation Committee in its sole discretion, and reflected the Compensation Committee’s evaluation of the progress made on our strategic initiatives year-over-year, while recognizing that not all our goals were achieved. On a weighted basis, as shown below, the calculated payout score was 115% of target. Exercise of Negative Discretion. Despite strong performance in achieving the Company’s financial targets and the Company’s leadership team making significant progress on the Company’s strategic priorities in 2023, the Compensation Committee considered Aptiv shareholders’ experience and decided to exercise negative discretion to reduce the initial calculated payout score (115%) earned by the NEOs to 100% of target. As a result of the analysis described above, the Compensation Committee approved the following 2023 Annual Incentive Plan payouts for the NEOs.
NEO AIP Weighting
| Name | Calculated Incentive Award Payout (115%) ($) | Impact of Negative Discretion (from 115% to 100%) | Actual Payment ($) | | Kevin P. Clark | $2,522,419 | ($329,011) | $2,193,408 | | Joseph R. Massaro | 1,832,813 | (239,063) | 1,593,750 | | William T. Presley | 1,035,000 | (135,000) | 900,000 | | Obed D. Louissaint | 862,500 | (112,500) | 750,000 | | Benjamin Lyon | 920,000 | (120,000) | 800,000 | | Katherine H. Ramundo | 891,250 | (116,250) | 775,000 |
NEO AIP Weighting
| 44 | COMPENSATION DISCUSSION AND ANALYSIS |
2023 LONG-TERM INCENTIVE COMPENSATION
2023 LONG-TERM INCENTIVE COMPENSATION Performance Metrics. Aptiv’s Long-Term Incentive Plan is designed to reward performance on long-term strategic metrics and to attract, retain and motivate participants. Aptiv’s Long-Term Incentive Plan is primarily performance-based, with 60% of the NEOs’ award consisting of performance-based RSUs, which deliver value if financial and relative TSR goals are met. The targets reflect Aptiv’s pay-for-performance culture, which help align executive and investor interests. The remaining 40% are time-based RSUs, the value of which fluctuates with Aptiv’s share price performance. The performance-based RSUs are settled after the results of a three-year performance period are determined. The time-based RSUs generally vest ratably over three years, beginning on the first anniversary of the grant date. The 2023 performance-based RSU grant vests at the end of 2025 and will be settled in early 2026 after the outcomes of the performance period are determined and approved. Under the design of the performance-based RSU awards, each NEO could receive from 0% to 200% of his or her target performance-based RSU award, as determined by Aptiv’s performance against certain Company-wide performance metrics. The metrics and weights used in the 2023 awards are:
2023 LONG-TERM INCENTIVE COMPENSATION
| Metric | Weighting (%) | | Average Return on Net Assets (RONA)(1) | 33.3% | | Cumulative Net Income (NI)(2) | 33.3 | | Relative Total Shareholder Return (TSR)(3) | 33.3 |
2023 LONG-TERM INCENTIVE COMPENSATION
| (1) Average RONA is tax-affected operating income divided by average net working capital plus average net property, plant and equipment for each calendar year, as adjusted for incentive plan calculation purposes. |
2023 LONG-TERM INCENTIVE COMPENSATION
| (2) Cumulative NI represents net income attributable to Aptiv before restructuring and other special items, including the tax impact thereon. |
2023 LONG-TERM INCENTIVE COMPENSATION
| (3) Relative TSR is measured by comparing the average closing price per share of the Company’s ordinary shares for all available trading days in December 2025 to the average closing price per share of the Company’s ordinary shares for all available trading days in December 2022, including the reinvestment of dividends, relative to the companies in the Russell 3000 Auto Parts Index. |
2023 LONG-TERM INCENTIVE COMPENSATION
2023 Grants. The Compensation Committee established the following 2023 target long-term incentive award values for our NEOs (consisting of performance-based RSUs and time-based RSUs, as described above). In so doing, the Compensation Committee considered market compensation benchmarks and each NEO’s scope of responsibilities, individual performance and retention considerations. Mr. Presley’s year-over-year increase in target long-term incentive value was connected to his promotion to Chief Operating Officer role, effective December 15, 2022.
2023 LONG-TERM INCENTIVE COMPENSATION
| Name | Performance-Based RSUs ($ at Target) | Time-Based RSUs | Total Long-Term Incentive Plan Target Annual Award ($) | | Kevin P. Clark | $7,800,000 | $5,200,000 | $13,000,000 | | Joseph R. Massaro | 3,450,000 | 2,300,000 | 5,750,000 | | William T. Presley | 2,100,000 | 1,400,000 | 3,500,000 | | Obed D. Louissaint | 1,800,000 | 1,200,000 | 3,000,000 | | Benjamin Lyon | 1,740,000 | 1,160,000 | 2,900,000 | | Katherine H. Ramundo | 1,380,000 | 920,000 | 2,300,000 |
2023 LONG-TERM INCENTIVE COMPENSATION
In addition to their respective annual long-term incentive awards, Messrs. Louissaint and Lyon were awarded new hire equity awards, both granted in February 2023. These awards were granted to keep Messrs. Louissaint and Lyon whole for the cash and equity incentive compensation that each forfeited at their prior employers in order to join Aptiv. Mr. Louissaint, who joined Aptiv from IBM, received a new hire award comprised of time-based RSUs, which has a target value of $8,000,000, and vests ratably (33.3% per year) over three years in October 2023, 2024, and 2025. Mr. Lyon, who joined Aptiv from Astra Space, a provider of space products and launch services to the global space industry, following a 20-year career at Apple, received a new hire award comprised of time-based RSUs, which has a target value of $8,000,000, and vests ratably (50% per year) over two years in February 2024 and 2025.
2023 LONG-TERM INCENTIVE COMPENSATION
| COMPENSATION DISCUSSION AND ANALYSIS | 45 |
2023 LONG-TERM INCENTIVE COMPENSATION
Ms. Ramundo was also granted a special equity award in addition to her 2023 annual long-term incentive award. The special equity award was granted in February 2023, has a target value of $2,000,000, and vests ratably (50% per year) over two years on each of February 2024 and 2025. This award was granted to recognize Ms. Ramundo’s extraordinary efforts to accelerate the closure of our Wind River transaction and effective management of the regulatory challenges in multiple geographies, which effectively accelerates our path to the fully-electrified software-defined vehicle. 2021-2023 Performance-Based RSUs. The Compensation Committee assessed the performance awards granted in February 2021 for which vesting was based on achievement of three-year cumulative performance through December 31, 2023. In February 2024, we paid out the performance-based RSUs for the 2021-2023 performance period. The following tables set forth: (1) the threshold, target and maximum levels, as well as the performance level achieved during the performance period; and (2) for each NEO, the target number of performance-based RSUs and actual number of performance-based RSUs earned.
2023 LONG-TERM INCENTIVE COMPENSATION
| Performance Metric | Weight | Threshold 40% Payout | Target 100% Payout | Maximum 200% Payout | Achievement (% of Target) | | Average Return on Net Assets (RONA)(1),(2) | | | Actual: 27.7% | | | | | 33.3% | | | | 113% | | | | 20.9% | 26.9% | 31.4% | | | | | | Actual: $3,551M | | | | Cumulative Net Income (NI)(2) | 33.3% | | | | 144% | | | | $2,514M | $3,232M | $3,771M | | | | Actual: 24th | | | | | | Relative Total Shareholder Return (TSR)(3) | 33.3% | | | | 0% | | | | 30th | 50th | 90th | | | Total Weighted Financial Performance Payout | | | | | 86% |
2023 LONG-TERM INCENTIVE COMPENSATION
| (1) Average RONA is tax-affected adjusted operating income divided by average net working capital plus average net property, plant and equipment for each calendar year, as adjusted for incentive plan calculation purposes. |
2023 LONG-TERM INCENTIVE COMPENSATION
| (2) For purposes of the Adjusted NI calculated results under the Long-Term Incentive Plan, the results shown in Appendix A of our Proxy Statement were adjusted to neutralize the impact of a 2022 reporting change to remove amortization from Adjusted NI and to remove the impact of M&A activity not included in the original target. |
2023 LONG-TERM INCENTIVE COMPENSATION
| (3) Relative TSR is measured by comparing the average closing price per share of the Company’s ordinary shares for the specified trading days in the fourth quarter of the final year of the performance period to the average closing price per share of the Company’s ordinary shares for the specified trading days in the fourth quarter of the year prior to the beginning of the performance period, including the reinvestment of dividends, relative to the companies in the Russell 3000 Auto Parts Index. |
2023 LONG-TERM INCENTIVE COMPENSATION
Based on the achievement of the performance goals during the period, the earned award was 86% of the target opportunity. As a result, the Compensation Committee approved the following 2021-2023 performance-based RSU award payouts.
2023 LONG-TERM INCENTIVE COMPENSATION
| | Performance-Based RSUs | | | Name(1) | Target Units Granted (#) | Actual Units Earned (#) | | Kevin P. Clark | 44,910 | 38,623 | | Joseph R. Massaro | 16,597 | 14,273 | | William T. Presley | 10,153 | 8,733 | | Katherine H. Ramundo | 6,411 | 5,513 |
2023 LONG-TERM INCENTIVE COMPENSATION
| (1) Messrs. Louissaint and Lyon joined Aptiv in January 2023, and December 2022, respectively, and therefore neither was a recipient of a long-term incentive award in 2021. |
2023 LONG-TERM INCENTIVE COMPENSATION
| 46 | COMPENSATION DISCUSSION AND ANALYSIS |
RECENT NEW HIRE INFORMATION
| • | Payment of $750,000 for the 2023 Annual Incentive Plan, payable in 2024; and |
RECENT NEW HIRE INFORMATION
| • | 2023 long-term incentive award valued at $3,000,000, granted in February 2023. |
RECENT NEW HIRE INFORMATION
Mr. Louissaint also received a cash award of $2,000,000, which was paid in the first quarter of 2023, and a special RSU award granted in 2023 with a target value of $8,000,000 which vests ratably in October 2023, 2024 and 2025 (as described above). These special cash and equity awards were made to keep Mr. Louissaint whole in respect of cash and equity compensation that he otherwise forfeited at IBM. As disclosed in Aptiv’s 2023 Proxy Statement, Mr. Lyon joined Aptiv in December 2022 from Astra Space, and accordingly his new hire equity award was granted in 2023, as detailed in the “2023 Long-Term Incentive Compensation” section above. This award was made to keep Mr. Lyon whole with respect to cash and equity compensation he otherwise forfeited at Astra Space.
OTHER COMPENSATION
OTHER COMPENSATION Additional compensation and benefit programs available to our NEOs are described below. Aptiv Salaried 401(k) Plan. Along with other eligible U.S. Aptiv salaried employees, our NEOs participate in our broad-based and tax-qualified defined contribution plan, the Aptiv Salaried 401(k) Plan, which is a qualified plan under Section 401(k) of the Internal Revenue Code (the “Code”). All contributions are subject to any contribution limits imposed by the Code. Aptiv Deferred Compensation Plan (“DCP”). Under the DCP, eligible U.S. employees, including our NEOs, receive Aptiv contributions in excess of the limits imposed upon the Aptiv Salaried 401(k) Plan by the Code. No guaranteed or above-market rates are earned; the investment options available are a subset of those available to all employees under the Aptiv Salaried 401(k) Plan. Additional details regarding benefits and payouts under this plan are provided in the “Non-Qualified Deferred Compensation” section. Severance Plans. In 2017, we adopted the Aptiv PLC Executive Severance Plan (the “Severance Plan”) and the Aptiv PLC Executive Change in Control Severance Plan (the “Change in Control Plan”). The plans were adopted to provide severance protections to certain executives who are designated by the Compensation Committee as eligible to participate in each plan, including our NEOs. For the participating NEOs, the Severance Plan generally provides for severance benefits in the event of a “qualifying separation” (as defined in the Severance Plan to include a termination without “cause” or a resignation for “good reason”) of the NEO’s employment. Pursuant to the Severance Plan, an NEO who incurs a qualifying separation would be entitled to receive severance payments equal in the aggregate to a multiple of annual base salary (1.5 times for officers with at least two years of service, and 1 time for all other officers), unless and until the NEO is employed by another employer. The Severance Plan also provides a COBRA subsidy for a period of up to 18 months following a qualifying separation. The Change in Control Plan generally provides for “double-trigger” severance benefits in connection with a “qualifying separation” (as defined in the Change in Control Plan to include a termination without “cause” or a resignation for “good reason”) that occurs in connection with or within two years after a Change in Control (as defined in the Change in Control Plan). Pursuant to the Change in Control Plan, an NEO who incurs a qualifying separation would generally be entitled to receive a lump sum cash payment in an amount equal to the sum of (1) three times base salary in the case of the CEO and two times base salary in the case of an NEO other than the CEO, and (2) in the case of the CEO, three times the higher of the CEO’s target annual cash incentive award
OTHER COMPENSATION
opportunity for the year in which the separation occurs or in effect immediately prior to the Change in Control (or in the case of an NEO other than the CEO, two times the higher of the NEO’s target annual cash incentive award opportunity for the year in which the separation occurs or in effect immediately prior to the Change in Control). In addition, an NEO who incurs a qualifying separation is also entitled to receive a lump sum payment representing the sum of 36 monthly COBRA premiums for the CEO and 24 monthly COBRA premiums for NEOs other than the CEO. Benefits under the Severance Plan and the Change in Control Plan are generally subject to execution by the NEO of a general waiver and release of claims in favor of Aptiv. Other Benefits. We provide additional benefits, such as relocation and expatriate benefits to our NEOs, when applicable, and in general, these benefits are the same as those provided to similarly situated non-officer employees. Additional details are covered in the “2023 Summary Compensation Table”.
COMPENSATION GOVERNANCE PRACTICES
| • | Mix of fixed and variable, cash-based and equity-based, and short- and long-term compensation, with an emphasis on equity-based pay; |
COMPENSATION GOVERNANCE PRACTICES
| • | Incentive award opportunities, with performance-based awards capped at 200% of the target amount, that span both annual and overlapping, multi-year time periods and incorporate a broad range of financial metrics, strategic initiatives and TSR; |
COMPENSATION GOVERNANCE PRACTICES
| 2023 SUMMARY COMPENSATION TABLE | 51 |
COMPENSATION GOVERNANCE PRACTICES
| | 2023 Summary Compensation Table |
COMPENSATION GOVERNANCE PRACTICES
| Name and Principal Position | Year | Salary ($)(1) | Bonus ($)(2) | Stock Awards ($)(3) | Non-Equity Incentive Plan Compensation ($) | All Other Compensation ($)(4) | Total ($) | | Kevin P. Clark Chairman and Chief Executive Officer | 2023 | $1,462,272 | $— | $14,032,595 | $2,193,408 | $311,861 | $18,000,136 | | | 2022 | 1,462,272 | — | 12,358,679 | 2,193,408 | 192,262 | 16,206,621 | | | 2021 | 1,462,272 | — | 12,295,011 | 745,759 | 241,738 | 14,744,780 | | Joseph R. Massaro Chief Financial Officer and Senior Vice President, Business Operations | 2023 | 1,256,250 | | 6,206,788 | 1,593,750 | 172,336 | 9,229,124 | | | 2022 | 1,150,000 | — | 4,943,446 | 1,500,000 | 103,463 | 7,696,909 | | | 2021 | 983,750 | — | 4,543,905 | 340,000 | 114,631 | 5,982,286 | | William T. Presley Senior Vice President and Chief Operating Officer, and President, Signal & Power Solutions | 2023 | 900,000 | | 3,778,060 | 900,000 | 136,450 | 5,714,510 | | | 2022 | 731,250 | — | 2,076,265 | 900,000 | 72,403 | 3,779,918 | | | 2021 | 643,750 | — | 2,779,753 | 221,000 | 79,556 | 3,724,059 | | Obed D. Louissaint Senior Vice President and Chief People Officer | 2023 | 750,000 | 2,000,000 | 11,139,181 | 750,000 | 82,190 | 14,721,371 | | Benjamin Lyon Senior Vice President and Chief Technology Officer | 2023 | 800,000 | — | 11,031,269 | 800,000 | 74,276 | 12,705,545 | | | 2022 | 9,091 | 4,000,000 | — | 800,000 | — | 4,809,091 | | Katherine H. Ramundo Senior Vice President, Chief Legal Officer, Chief Compliance Officer and Secretary | 2023 | 750,250 | — | 4,457,991 | 775,000 | 103,500 | 6,086,741 |
COMPENSATION GOVERNANCE PRACTICES
| 2023 GRANTS OF PLAN-BASED AWARDS | 53 |
COMPENSATION GOVERNANCE PRACTICES
| | 2023 Grants of Plan-Based Awards |
COMPENSATION GOVERNANCE PRACTICES
| 54 | 2023 GRANTS OF PLAN-BASED AWARDS |
COMPENSATION GOVERNANCE PRACTICES
| 2023 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END | 55 |
COMPENSATION GOVERNANCE PRACTICES
| | 2023 Outstanding Equity Awards at Fiscal Year-End |
COMPENSATION GOVERNANCE PRACTICES
| 56 | 2023 OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END |
COMPENSATION GOVERNANCE PRACTICES
| 2023 OPTION EXERCISES AND STOCK VESTED TABLE | 57 |
COMPENSATION GOVERNANCE PRACTICES
| | 2023 Option Exercises and Stock Vested Table |
COMPENSATION GOVERNANCE PRACTICES
| 58 | 2023 NON-QUALIFIED DEFERRED COMPENSATION |
COMPENSATION GOVERNANCE PRACTICES
| | 2023 Non-Qualified Deferred Compensation |
VESTING
| 2023 NON-QUALIFIED DEFERRED COMPENSATION | 59 |
2023 NON-QUALIFIED DEFERRED COMPENSATION TABLE
2023 NON-QUALIFIED DEFERRED COMPENSATION TABLE
2023 NON-QUALIFIED DEFERRED COMPENSATION TABLE
| Name | Executive Contributions in Last FY ($)(1) | Registrant Contributions in Last FY ($)(2) | Aggregate Earnings in Last FY ($)(3) | Aggregate Withdrawals / Distributions ($)(4) | Aggregate Balance at Last FYE ($) | | Kevin P. Clark | $232,798 | $249,426 | $245,667 | $— | $1,819,044 | | Joseph R. Massaro | 72,788 | 133,444 | 93,779 | 214,260 | 488,097 | | William T. Presley | 102,900 | 110,250 | 47,982 | — | 511,685 | | Obed D. Louissaint | — | 56,800 | 1,762 | — | 58,562 | | Benjamin Lyon | — | 50,800 | 1,356 | — | 52,156 | | Katherine H. Ramundo | 69,640 | 74,614 | 31,052 | — | 283,064 |
2023 NON-QUALIFIED DEFERRED COMPENSATION TABLE
| (1) All NEOs other than Messrs. Louissaint and Lyon elected to defer a portion of their salary and annual incentive awards as permitted under the DCP. Each NEO’s total salary and annual incentive award, including these deferred amounts, is reported in the “2023 Summary Compensation Table”. |
2023 NON-QUALIFIED DEFERRED COMPENSATION TABLE
| (2) Company contributions to the NEOs’ DCP accounts, along with contributions to the qualified Aptiv Salaried 401(k) Plan, are disclosed in the “All Other Compensation” column in the “2023 Summary Compensation Table”. |
2023 NON-QUALIFIED DEFERRED COMPENSATION TABLE
| (3) Aggregate earnings represent change (including losses) in market value less any fee paid by the NEO, but none of these amounts are disclosed in the “2023 Summary Compensation Table”. |
2023 NON-QUALIFIED DEFERRED COMPENSATION TABLE
| (4) The withdrawals of our NEO(s) were made in accordance with the deferral election process described in this section. |
2023 NON-QUALIFIED DEFERRED COMPENSATION TABLE
| 60 | POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL |
2023 NON-QUALIFIED DEFERRED COMPENSATION TABLE
| | Potential Payments Upon Termination or Change in Control |
LONG-TERM INCENTIVE PLAN
| POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL | 61 |
SEVERANCE PLAN
| 62 | POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL |
SEVERANCE PLAN
| POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL | 63 |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| | | Termination Scenario | | | | | | Name | Component | Voluntary Resignation / Retirement (If Eligible)(5)(6) | Involuntary (Not For Cause) or For Good Reason | Involuntary (For Cause) | Change in Control and Termination | Death /Disability | | Kevin P. Clark | Cash Severance(1) | $ — | $5,483,520 | $— | $10,967,040 | $ — | | | Annual Incentive Plan(2) | — | — | — | 2,193,408 | 2,193,408 | | | Long-Term Incentives—Time-Based Restricted Stock Units(3)(4) | — | 1,645,644 | — | 7,016,373 | 1,645,644 | | | Long-Term Incentives—Performance-Based Restricted Stock Units(3)(4) | 7,171,589 | 7,171,589 | — | 14,829,101 | 7,171,589 | | | Benefits Continuation | — | 29,233 | — | 76,035 | — | | | Total | 7,171,589 | 14,329,986 | — | 35,081,957 | 11,010,641 | | Joseph R. Massaro | Cash Severance(1) | — | 4,303,125 | — | 5,737,500 | — | | | Annual Incentive Plan(2) | — | — | — | 1,593,750 | 1,593,750 | | | Long-Term Incentives—Time-Based Restricted Stock Units(3)(4) | — | 635,666 | — | 2,946,943 | 635,666 | | | Long-Term Incentives—Performance-Based Restricted Stock Units(3)(4) | 1,489,083 | 2,745,970 | — | 6,060,496 | 2,745,970 | | | Benefits Continuation | — | 29,233 | — | 50,690 | — | | | Total | 1,489,083 | 7,713,994 | — | 16,389,379 | 4,975,386 | | William T. Presley | Cash Severance(1) | — | 1,350,000 | — | 3,600,000 | — | | | Annual Incentive Plan(2) | — | — | — | 900,000 | 900,000 | | | Long-Term Incentives—Time-Based Restricted Stock Units(3)(4) | — | 320,031 | — | 1,632,097 | 320,031 | | | Long-Term Incentives—Performance-Based Restricted Stock Units(3)(4) | 910,927 | 1,438,840 | — | 3,326,997 | 1,438,840 | | | Benefits Continuation | — | 18,475 | — | 30,682 | — | | | Total | 910,927 | 3,127,346 | — | 9,489,776 | 2,658,871 | | Obed D. Louissaint | Cash Severance(1) | — | 750,000 | — | 3,000,000 | — | | | Annual Incentive Plan(2) | — | — | — | 750,000 | 750,000 | | | Long-Term Incentives—Time-Based Restricted Stock Units(3)(4) | — | — | — | 4,978,563 | — | | | Long-Term Incentives—Performance-Based Restricted Stock Units(3)(4) | — | — | — | 1,371,639 | — | | | Benefits Continuation | — | 27,280 | — | 44,845 | — | | | Total | — | 777,280 | — | 10,145,047 | 750,000 | | Benjamin Lyon | Cash Severance(1) | — | 800,000 | — | 3,200,000 | — | | | Annual Incentive Plan(2) | — | — | — | 800,000 | 800,000 | | | Long-Term Incentives—Time-Based Restricted Stock Units(3)(4) | — | — | — | 6,980,216 | — | | | Long-Term Incentives—Performance-Based Restricted Stock Units(3)(4) | — | — | — | 1,325,882 | — | | | Benefits Continuation | — | 29,233 | — | 50,690 | — | | | Total | — | 829,233 | — | 12,356,788 | 800,000 | | Katherine H. Ramundo | Cash Severance(1) | — | 1,162,500 | — | 3,100,000 | — | | | Annual Incentive Plan(2) | — | — | — | 775,000 | 775,000 | | | Long-Term Incentives—Time-Based Restricted Stock Units(3)(4) | — | 935,331 | — | 3,502,759 | 935,331 | | | Long-Term Incentives—Performance-Based Restricted Stock Units(3)(4) | 575,195 | 1,027,743 | — | 2,326,081 | 1,027,743 | | | Benefits Continuation | — | — | — | — | — | | | Total | 575,195 | 3,125,574 | — | 9,703,840 | 2,738,074 |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (1) In the case of an involuntary not for cause termination or a termination for good reason, Messrs. Clark and Massaro are eligible to receive severance payments equal to 18 months of base salary, plus 1.5 times the value of the annual incentive plan target award, payable in installments. Mr. Presley and Ms. Ramundo are eligible for a severance payment equal to 1.5 times base salary, payable in installments. Messrs. Louissaint and Lyon are eligible for a severance payment equal to 1 times base salary, payable in installments. In the case of a qualifying Change in Control termination, Mr. Clark is eligible to receive a lump sum severance payment equal to 3 times base salary, plus 3 times the value of the annual incentive plan target award. In the case of a qualifying Change in Control termination, Messrs. Massaro, Presley, Louissaint and Lyon and Ms. Ramundo are eligible to receive a lump sum severance payment equal to 2 times base salary, plus 2 times the value of the annual incentive plan target award. |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| 64 | POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (2) In the case of a Change in Control, each NEO would receive a prorated annual incentive award payment based on the greater of (a) actual performance or (b) target. If the NEO terminates due to death or disability, he or she would receive a prorated annual incentive award based on actual performance. In the case of any other terminations prior to the payment date, the award is forfeited in its entirety. The values shown use target performance. |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (3) The value shown is based on the market value of the award using a per-share price of $89.72, the closing price of our stock on December 29, 2023 (the last trading day of fiscal 2023). |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (4) In the event of a qualifying termination within two years after a change in control the NEOs’ awards will vest as described under “Potential Payments Upon Termination or Change in Control—Long-Term Incentive Plan”. Also as described under “Potential Payments Upon Termination or Change in Control—Long-Term Incentive Plan”, if at the time of a change in control the NEOs do not receive replacement awards, their awards will vest upon the change in control regardless of whether their employment is terminated. The performance-based RSUs included represent a 100% payout of each award. |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (5) In the event of a voluntary termination on December 29, 2023 (the last business day of fiscal 2023), each NEO would receive the value of their 2021 performance-based RSUs. |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (6) As of December 31, 2023, Mr. Clark is the only NEO eligible to retire. |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
As required by Section 409A of the Code, all NEOs who have elected to participate in the DCP generally must wait six months to receive a payment under the plan by reason of termination of employment. Payments for departure on December 31, 2023 would generally be made within 60 days after July 1, 2024. All amounts are estimates only, and actual amounts will vary depending upon the facts and circumstances applicable at the time of the triggering event.
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| CEO PAY RATIO | 65 |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| | CEO Pay Ratio |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
We are required by the Dodd-Frank Wall Street Reform and Consumer Protection Act and SEC rules to disclose the ratio of the annual total compensation of Mr. Clark, our Chairman and Chief Executive Officer, to that of an employee whose annual compensation is at the median of all our employees (the “Median Employee”). Due to our permitted use of reasonable estimates and assumptions in preparing this pay ratio disclosure, the disclosure may involve a degree of imprecision, and thus this ratio disclosure is a reasonable estimate calculated in a manner consistent with Item 402(u) of Regulation S-K using the data and assumptions described below. As permitted under SEC rules, we are using the same Median Employee identified for purposes of our fiscal 2022 CEO pay ratio, as we believe there have been no changes to our employee population or employee compensation arrangements that would significantly impact our pay ratio disclosure. The Median Employee was identified by using “total annual base pay” as reflected in our enterprise-wide human resources information system, as of October 31, 2022, for all of our employees (including full-time, part-time, and temporary employees of Aptiv and its consolidated subsidiaries). The employees considered did not include any independent contractors or “leased” workers, which we refer to as our “contingent workforce” below. We did not use any statistical sampling or cost-of-living adjustments for purposes of this pay ratio disclosure. The total annual base pay for our salaried employees reflects base salary paid on an annual basis, and for hourly employees, the annual rate is determined using their hourly rate and standard work hours. This methodology was chosen because we believe it is a compensation measure that can be applied consistently across the globe and provides an accurate depiction of total earnings. Because there was more than one Median Employee identified using this methodology, we selected an individual who we determined to be reasonably representative of our Median Employee and who did not have any unusual or nonstandard compensation items. Aptiv is a global company employing approximately 154,000 employees in 50 countries as of December 31, 2023, with approximately 31,000 salaried employees and 123,000 hourly employees. In addition, we maintain a contingent workforce of approximately 47,000 to accommodate fluctuations in customer demand. 53% of our workforce is located in North America, where our largest presence is in Mexico. 80% of our North American workforce is part of our global manufacturing workforce. Market levels of pay and wage rates are generally lower in countries in which Aptiv has manufacturing facilities, in line with our regional service model that enables us to efficiently and effectively serve our global customers from best cost countries. In these countries, Aptiv provides market competitive compensation, which, in many cases, is dictated by local union agreements. The Median Employee is a full-time hourly employee located in Mexico, where competitive wages vary greatly from standard U.S. hourly rates. After identifying the Median Employee, we calculated annual total compensation for the Median Employee using the same methodology as compensation reported in the 2023 Summary Compensation Table for the CEO. The Median Employee’s annual total compensation is $11,647. When compared to our CEO’s annual total compensation of $18,000,136, the ratio of the total annual compensation of our CEO to the total annual compensation of our Median Employee was approximately 1,545:1. We believe that there are a number of reasons why our pay ratio is not comparable to that of other companies, including that other companies may have a median employee that works in the U.S., may outsource manufacturing, may have different types of workforces, may operate in different countries, or may utilize different compensation practices. Further, in calculating their own pay ratios, other companies may utilize methodologies, exclusions, estimates, and assumptions that substantially differ from Aptiv’s calculation methodology.
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| 66 | 2023 PAY VERSUS PERFORMANCE TABLE |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| | 2023 Pay Versus Performance Table |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
In accordance with SEC rules, the following table sets forth information with respect to how the compensation of our NEOs aligns with Company performance.
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| | | | | | Value of Initial Fixed $100 Investment Based On: | | | | | Year (1) (a) | Summary Compensation Table Total for PEO ($) (b) | Compensation Actually Paid To PEO ($) (2)(3)(4) (c) | Average Summary Compensation Table Total for non-PEO NEOs ($) (d) | Average Compensation Actually Paid to non-PEO NEOs ($) (2)(3(4)) (e) | Total Shareholder Return ($) (5) (f) | Peer Group Total Shareholder Return ($) (5) (g) | Net Income ($ millions) (6) (h) | Adjusted Net Income ($ millions) (7) (i) | | 2023 | $18,000,136 | $16,072,614 | $9,691,458 | $8,388,279 | $94.70 | $296.83 | $2,938 | $1,376 | | 2022 | 16,206,621 | (3,338,551) | 5,880,152 | 3,091,630 | 98.30 | 183.92 | 594 | 967 | | 2021 | 14,744,780 | 20,823,184 | 4,899,559 | 6,122,511 | 174.11 | 433.35 | 590 | 868 | | 2020 | 31,267,329 | 32,047,839 | 6,747,057 | 6,881,294 | 137.52 | 291.17 | 1,804 | 646 |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (1) NEOs included in the above compensation columns reflect the following: |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| Year | Principal Executive Officer (“PEO”) | Non-PEO NEOs | | 2023 | Kevin P. Clark | Joseph R. Massaro, William T. Presley, Obed D. Louissaint, Benjamin Lyon, Katherine H. Ramundo | | 2022 | Kevin P. Clark | Joseph R. Massaro, Benjamin Lyon, William T. Presley, Sophia M. Velastegui | | 2021 | Kevin P. Clark | Joseph R. Massaro, William T. Presley, Katherine H. Ramundo, Mariya K. Trickett | | 2020 | Kevin P. Clark | Joseph R. Massaro, David Paja, David M. Sherbin, Mariya K. Trickett |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (2) Fair value or change in fair value, as applicable, of equity awards in the “Actually Paid” columns was determined by reference to (1) for RSU awards (excluding TSR awards and other performance-based awards), the closing price on each applicable year-end date or, in the case of vesting dates, the actual vesting date closing price, (2) for performance-based RSU awards (excluding TSR awards), the same valuation methodology as RSU awards above except that year-end award values are adjusted by the projected probability of achievement of each award as of each such date, and (3) for TSR-based awards, the fair value calculated by a Monte Carlo simulation as of the applicable year-end date. |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (3) For the portion of “Actually Paid” compensation that is based on year-end stock prices, the following prices were used: 2023: $89.72 (4% reduction from prior year), 2022: $93.13 (44% reduction from prior year), 2021: $164.95 (27% increase from prior year), 2020: $130.29 (38% increase from prior year). |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (4) “Compensation Actually Paid” to our PEO and the average “Compensation Actually Paid” to non-PEO NEOs reflects adjustments from total compensation reported in the Summary Compensation Table (see reconciliation below) |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| | | PEO | Average Non-PEO NEOs | | Total Reported in 2023 Summary Compensation Table (SCT) | | $18,000,136 | $9,691,458 | | + | Value of Stock Awards reported in SCT | $0 | $0 | | + | Year-end value of awards granted in fiscal year that are unvested and outstanding | ($14,032,595) | ($7,322,658) | | + | Change in fair value of prior year awards that are unvested and outstanding | $0 | $0 | | + | Fair market value of awards granted in fiscal year 2023 that vested in fiscal year 2023 | $13,237,937 | $6,297,217 | | + | Change in fair value (from prior year-end) of prior year awards that vested in fiscal year 2023 | ($4,101,605) | ($599,594) | | + | Prior year-end fair value of awards that failed to vest in fiscal year 2023 | $2,968,741 | $321,856 | | Total Adjustments | | ($1,927,522) | ($1,303,179) | | Compensation Actually Paid for Fiscal Year 2023 | | $16,072,614 | $8,388,279 |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (5) Peer group TSR reflects the Company’s 2023 Automotive Peer Group (“Russell 3000 Automobiles and Parts Sector”) as reflected in our 2023 Annual Report on Form 10-K pursuant to Item 201(e) of Regulation S-K. Each year reflects what the cumulative value of a $100 investment would be, including reinvestment of dividends. Peer group cumulative TSR results for years prior to 2023 in the table above reflect updated values (based on a methodology change from each constituent’s TSR being weighted in the prior year’s disclosure according to market capitalization in the base year to the current approach, reflecting the index return and its weighting methodology). |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| 2023 PAY VERSUS PERFORMANCE TABLE | 67 |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (6) The year ended December 31, 2023 includes a $2.1 billion deferred tax benefit recognized from the Company’s initiation of changes to its corporate entity structure, including intercompany transfers of intellectual property and other related transactions, as further discussed in Note 14 of our 2023 Annual Report on Form 10-K. The year ended December 31, 2020 includes a pre-tax gain of $1.4 billion for the completion of the Motional autonomous driving joint venture, as further discussed in Note 20 of our 2022 Annual Report on Form 10-K. |
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL TABLE
| (7) Adjusted NI was selected by the Compensation Committee as the Company-Selected Measure (“CSM”). It is a non-GAAP measure which represents net income attributable to Aptiv before restructuring and other special items, including the tax impact thereon. Appendix A contains a reconciliation of Adjusted NI to U.S. GAAP Net Income. |
ANALYSIS OF THE INFORMATION PRESENTED IN THE PAY VERSUS PERFORMANCE TABLE
ANALYSIS OF THE INFORMATION PRESENTED IN THE PAY VERSUS PERFORMANCE TABLE In accordance with SEC rules, the following charts describe the relationship between the “Compensation Actually Paid” to our NEOs and the Company’s financial performance as measured by our cumulative TSR, GAAP NI and our CSM, Adjusted NI. As more fully described under “Compensation Governance and Alignment with Shareholders” in our “Compensation Discussion and Analysis” section, our focus on pay-for-performance and corporate governance aims to help ensure alignment with the interests of our shareholders, as highlighted below. Aligning executive compensation to Company financial and stock price performance is one of the key design principles of our executive compensation program. This is evidenced by the program design elements, including:
ANALYSIS OF THE INFORMATION PRESENTED IN THE PAY VERSUS PERFORMANCE TABLE
| • | 91% of 2023 total target annual compensation for the CEO is at risk and 78% is granted in equity, while, on average, 83% of 2023 total target annual compensation for the other NEOs is at risk and 65% is granted in equity. |
ANALYSIS OF THE INFORMATION PRESENTED IN THE PAY VERSUS PERFORMANCE TABLE
| • | We use a structured goal-setting process for performance incentives, with multiple levels of review including the Compensation Committee and its consultant, and senior management. |
ANALYSIS OF THE INFORMATION PRESENTED IN THE PAY VERSUS PERFORMANCE TABLE
| • | NEOs’ annual incentives are typically based on achievement of multi-faceted financial and strategic annual performance goals. |
ANALYSIS OF THE INFORMATION PRESENTED IN THE PAY VERSUS PERFORMANCE TABLE
| • | 60% of the NEOs’ long-term incentive compensation consists of performance-based RSUs, which deliver value based on achievement of multi-year financial and relative TSR goals. |
ANALYSIS OF THE INFORMATION PRESENTED IN THE PAY VERSUS PERFORMANCE TABLE
| • | We review and analyze our pay-for-performance alignment on an annual basis, both in absolute terms and relative to our peer group. |
Compensation Actually Paid Versus Total Shareholder Return
Compensation Actually Paid Versus Total Shareholder Return (1)
Compensation Actually Paid Versus Total Shareholder Return
| (1) TSR in the above chart, in the case of both the Company and our Automotive Peer Group as noted in footnote 5 of the above Pay for Performance Table, reflects the cumulative return of $100 as if invested on December 31, 2019, including reinvestment of any dividends. |
Compensation Actually Paid Versus Total Shareholder Return
| 68 | 2023 PAY VERSUS PERFORMANCE TABLE |
Compensation Actually Paid Versus Net Income
Compensation Actually Paid Versus Net Income (1)
Compensation Actually Paid Versus Net Income
| (1) The year ended December 31, 2023 includes a $2.1 billion deferred tax benefit recognized from the Company’s initiation of changes to its corporate entity structure, including intercompany transfers of intellectual property and other related transactions, as further discussed in Note 14 of our 2023 Annual Report on Form 10-K. The year ended December 31, 2020 includes a pre-tax gain of $1.4 billion for the completion of the Motional autonomous driving joint venture, as further discussed in Note 20 of our 2022 Annual Report on Form 10-K. |
Compensation Actually Paid versus Adjusted Net Income
Compensation Actually Paid versus Adjusted Net Income (1)
Compensation Actually Paid versus Adjusted Net Income
| (1) Adjusted Net Income was selected by the Compensation Committee as the Company-Selected Measure. It is a non-GAAP measure which represents net income attributable to Aptiv before restructuring and other special items, including the tax impact thereon. Appendix A contains a reconciliation of Adjusted Net Income to U.S. GAAP Net Income. |
Compensation Actually Paid versus Adjusted Net Income
| 2023 PAY VERSUS PERFORMANCE TABLE | 69 |

DEF 14A of Aptiv PLC

ELECTION OF DIRECTORS

ELECTION OF DIRECTORS

ELECTION OF DIRECTORS

ELECTION OF DIRECTORS

ELECTION OF DIRECTORS

ELECTION OF DIRECTORS

ELECTION OF DIRECTORS

ELECTION OF DIRECTORS

ELECTION OF DIRECTORS

ELECTION OF DIRECTORS

ELECTION OF DIRECTORS

EXECUTIVE COMPENSATION

EXECUTIVE COMPENSATION

DIRECTOR NOMINEES

DIRECTOR NOMINEES

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

(RESOLUTIONS 1 TO 10)

Board Independence and Accountability

Board Independence and Accountability

Board Independence and Accountability

Board Independence and Accountability

DIVERSITY, SKILLS AND EXPERIENCE OF OUR DIRECTOR NOMINEES

DIVERSITY, SKILLS AND EXPERIENCE OF OUR DIRECTOR NOMINEES

COMMUNICATIONS WITH THE BOARD OF DIRECTORS

COMMUNICATIONS WITH THE BOARD OF DIRECTORS

BOARD COMPENSATION

BOARD COMPENSATION

2023 DIRECTOR COMPENSATION

2023 DIRECTOR COMPENSATION

2023 DIRECTOR COMPENSATION

2023 DIRECTOR COMPENSATION

2023 DIRECTOR COMPENSATION

2023 DIRECTOR COMPENSATION

2023 DIRECTOR COMPENSATION

CEO REALIZED PAY AND OUR PERFORMANCE

CEO REALIZED PAY AND OUR PERFORMANCE

CEO REALIZED PAY AND OUR PERFORMANCE

COMPENSATION GOVERNANCE AND ALIGNMENT WITH SHAREHOLDERS

COMPENSATION GOVERNANCE AND ALIGNMENT WITH SHAREHOLDERS

EXECUTIVE COMPENSATION PHILOSOPHY AND STRATEGY

EXECUTIVE COMPENSATION PHILOSOPHY AND STRATEGY

EXECUTIVE COMPENSATION PHILOSOPHY AND STRATEGY

2023 COMPENSATION PROGRAM OVERVIEW

2023 COMPENSATION PROGRAM OVERVIEW

2023 COMPENSATION PROGRAM OVERVIEW

2023 ANNUAL COMPENSATION DETERMINATION

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting

NEO AIP Weighting