DEF 14A of Mcdonalds Corp
Filed Apr 7, 2025 · FY20240001558370-25-004544
Overview of Director Nominees
Overview of Director Nominees The following table provides an overview of the 11 Directors who are standing for re-election at our 2025 Annual Shareholders’ Meeting. See “Proposal 1: Election of Directors” on page 18 for more information.
Overview of Director Nominees
| | | BOARD TENURE | | STANDING COMMITTEE MEMBERSHIP | | | | | OTHER PUBLIC COMPANY BOARDS | | | NAME | | INDEPENDENT | AFC | CC | GC | CRC | EC | | | | Anthony Capuano President and CEO Marriott International, Inc. | 2 years | | | | | | | 1 | | | Kareem Daniel Former Chairman Disney Media & Entertainment Distribution | 2 years | | | | | | | 0 | | | Lloyd Dean Chief Executive Emeritus and Founding Executive CommonSpirit Health | 9 years | | | | | | | 2 | | | Catherine Engelbert Commissioner Women’s National Basketball Association | 5 years | | | | | | | 1 | | | Margaret Georgiadis Co-Founder and CEO Montai Therapeutics | 10 years | | | | | | | 1 | | | Michael Hsu Chairman and CEO Kimberly-Clark Corporation | 1 year | | | | | | | 1 | | | Christopher Kempczinski Chairman, President and CEO McDonald’s Corporation | 5 years | | | | | | | 1 | | | Jennifer Taubert EVP, Worldwide Chairman, Innovative Medicine Johnson & Johnson | 2 years | | | | | | | 0 | | | Paul Walsh Executive Chairman McLaren Group Limited | 6 years | | | | | | | 2 | | | Amy Weaver Incoming CEO(1) Direct Relief | 2 years | | | | | | | 0 | | | Miles White Former Executive Chairman Abbott Laboratories | 16 years | | | | | | | 0 |
Overview of Director Nominees
| AFC: | Audit & Finance Committee | CRC: | Corporate Responsibility Committee | | Member | | CC: | Compensation Committee | EC: | Executive Committee | | Committee Chair | | GC: | Governance Committee | | | F | Financial Expert |
Overview of Director Nominees
(1) Ms. Weaver is expected to become the CEO on May 5, 2025.
Overview of Director Nominees
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Biographical Information
Biographical Information Biographical information about our Board’s Director nominees as of the date of this Proxy Statement, including their ages, professional experiences, Board tenure, Committee memberships, qualifications and other public company directorships, is set forth on the following pages.
Biographical Information
| | Anthony Capuano | | | | | | | | | | | | | | | | | | | | | | | PRESIDENT AND CHIEF EXECUTIVE OFFICER, MARRIOTT INTERNATIONAL, INC. Age: 59 Board Tenure: 2 years | Brand Management | Customer- Centric | Digital | Finance / Capital Markets | Global Experience | Human Capital Management | Marketing | Other Public Company Boards | Real Estate | Sustainability / Corporate Responsibility | | | | Mr. Capuano brings to our Board over 25 years of leadership experience gained from his senior executive roles, including president and chief executive officer, at Marriott. His service at a global hospitality company known for its focus on creating a positive guest experience contributes an important perspective to our Board’s discussions regarding enhancing our own customers’ experiences, including through our loyalty programs. Our Board also benefits from Mr. Capuano’s significant global development experience, and his service on the social impact committee of Marriott’s board of directors provides our Board with valuable insights regarding our own corporate responsibility and sustainability efforts. Mr. Capuano’s public company board experience also gives him a broad understanding of governance issues facing public companies. | | | | | | | | |
Biographical Information
| Professional Experience Marriott International, Inc., a global hospitality company ● President and Chief Executive Officer (2023 – Present) ● Chief Executive Officer (2021 – 2023) ● Group President, Global Development, Design and Operations Services (2020 – 2021) ● Executive Vice President and Global Chief Development Officer (2009 – 2020) | Other Public Company Directorships Mr. Capuano also serves on the board of Marriott International, Inc. Committee Memberships: ● Compensation ● Corporate Responsibility |
Biographical Information
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Biographical Information
| | Kareem Daniel | | | | | | | | | | | | | | | | | | | | | FORMER CHAIRMAN, DISNEY MEDIA & ENTERTAINMENT DISTRIBUTION Age: 50 Board Tenure: 2 years | Brand Management | Customer- Centric | Digital | Finance / Capital Markets | Global Experience | Human Capital Management | Information Technology / Cybersecurity | Marketing | Sustainability / Corporate Responsibility | | | | Mr. Daniel brings to our Board valuable leadership experience gained from his senior executive roles at Walt Disney, one of the world’s most well-known and admired brands. His extensive corporate development experience includes leading transformation across several Disney divisions. The knowledge Mr. Daniel has gained through leading the creation of a direct-to-consumer e-commerce business, as well as overseeing the development of new distribution and commercialization models, offers a valuable perspective to our Board’s discussions regarding strategy and business development. | | | | | | | |
Biographical Information
| ● ● ● ● ● | ● ● | | Professional Experience The Walt Disney Company, a global entertainment and media company ● Chairman, Disney Media & Entertainment Distribution (2020 – 2022) ● President, Consumer Products, and Chief of Staff, Office of the Chief Executive Officer (2020) ● President, Walt Disney Imagineering Operations, Product Creation, Publishing and Games (2019 – 2020) ● Executive Vice President, Global Business Operations, Walt Disney Imagineering (2017 – 2019) ● Senior Vice President, Strategy and Business Development, Disney Consumer Products and Interactive Media (2011 – 2017) | Other Public Company Directorships None. Committee Memberships: ● Audit & Finance ● Compensation |
Biographical Information
| 2025 Proxy Statement | 21 |
Biographical Information
| | Lloyd Dean | | | | | | | | | | | | | | | CHIEF EXECUTIVE EMERITUS AND FOUNDING EXECUTIVE, COMMONSPIRIT HEALTH Age: 74 Board Tenure: 9 years | Brand Management | Customer- Centric | Finance / Capital Markets | Human Capital Management | Other Public Company Boards | Sustainability / Corporate Responsibility | | | | Mr. Dean brings to our Board over 25 years of leadership, management, and strategy experience, which contributes an important perspective to our Board’s discussions of opportunities and challenges in a constantly changing business environment. In his career in executive management at leading healthcare organizations, Mr. Dean has led significant strategic, operational, and financial transformations. Mr. Dean’s healthcare experience and knowledge of health and safety risks are particularly important and enhance his ability to oversee human capital management matters. Our Board also benefits from Mr. Dean’s finance, systems operations, service quality, human resources, customer-centric operations, community affairs and regulatory experience. | | | | |
Biographical Information
| ● ● ● | Dean also serves on the boards of Golden Arrow Merger Corp. and Progyny, Inc. ● (Chair since 2023) ● ● | | Professional Experience CommonSpirit Health, a non-profit, Catholic health system ● Chief Executive Emeritus and Founding Executive (2022 – Present) ● Chief Executive Officer (2019 – 2022) Dignity Health, one of the nation’s largest healthcare systems ● President and Chief Executive Officer (2000 – 2019) | Other Public Company Directorships Mr. Dean also serves on the boards of Golden Arrow Merger Corp. and Progyny, Inc. Committee Memberships: ● Compensation (Chair since 2023) ● Executive ● Governance |
Biographical Information
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Biographical Information
| | Catherine Engelbert | | | | | | | | | | | | | | | | | | | | | COMMISSIONER, WOMEN’S NATIONAL BASKETBALL ASSOCIATION Age: 60 Board Tenure: 5 years | Brand Management | Customer- Centric | Digital | Finance / Capital Markets | Global Experience | Human Capital Management | Marketing | Other Public Company Boards | Sustainability / Corporate Responsibility | | | | Ms. Engelbert brings to our Board a wealth of experience in global business operations, finance, leadership, brand, customer strategy, financial reporting and internal controls, and risk management matters gained from her service as Commissioner of a professional sports league and as former chief executive officer of Deloitte LLP. Having led more than 100,000 professionals at Deloitte, she also provides our Board valuable insights on talent management and other human capital management matters. Ms. Engelbert has strong leadership and governance experience from her previous roles on the private company board of Deloitte LLP and as chairman and chief executive officer of Deloitte & Touche LLP, and valuable regulatory experience from her roles on the strategic investment, risk, regulatory & government relations, and finance & audit committees of the board of Deloitte LLP. With 33 years of previous public accounting experience as a certified public accountant, Ms. Engelbert further brings to our Board a deep understanding of accounting principles and financial reporting rules and regulations, and her qualification as an “audit committee financial expert” is an important attribute as our Audit & Finance Committee Chair. | | | | | | | |
Biographical Information
| ● ● ● ● | Engelbert also serves on the board of Royalty Pharma plc. ● (Chair since 2022) ● ● | | Professional Experience Women’s National Basketball Association (WNBA), a professional basketball league ● Commissioner (2019 – Present) Deloitte LLP, an industry-leading audit, consulting, tax, and advisory services firm ● Chief Executive Officer (2015 – 2019) Deloitte & Touche LLP, audit subsidiary of Deloitte LLP ● Chairman and Chief Executive Officer (2014 – 2015) ● Partner (1998 – 2019) | Other Public Company Directorships Ms. Engelbert also serves on the board of Royalty Pharma plc. Committee Memberships: ● Audit & Finance (Chair since 2022) ● Corporate Responsibility ● Executive |
Biographical Information
| 2025 Proxy Statement | 23 |
Biographical Information
| | Margaret Georgiadis | | | | | | | | | | | | | | | | | | | | | | | CO-FOUNDER AND CHIEF EXECUTIVE OFFICER, MONTAI THERAPEUTICS Age: 61 Board Tenure: 10 years | Brand Management | Customer- Centric | Digital | Finance / Capital Markets | Global Experience | Human Capital Management | Information Technology / Cybersecurity | Marketing | Other Public Company Boards | Sustainability / Corporate Responsibility | | | | Ms. Georgiadis brings to our Board valuable strategy and development, finance and leadership experience gained from her senior executive roles, including at Ancestry, Mattel and Google, and her positions at a private investment and strategic advisory firm. Her experience as a senior executive at large global businesses affords her a broad knowledge of global consumer businesses, as well as of technology and cybersecurity, digital consumer insights, e-commerce and marketing. Her knowledge in these and other areas provides critical insights to our business, particularly as our Board considers the impact of technology, digital and cybersecurity risks. Ms. Georgiadis also has over 15 years of analytical and strategic experience at McKinsey & Company, a global management and consulting firm. In addition, Ms. Georgiadis’ qualification as an “audit committee financial expert” is an important attribute as a member of our Audit & Finance Committee. | | | | | | | | |
Biographical Information
| ● ● ● ● ● ● ● | ● ● | | Professional Experience Montai Therapeutics, a digital medical technology company (formerly Montai Health) ● Co-Founder and Chief Executive Officer (2022 – Present) Flagship Pioneering, a bioplatform innovation company ● CEO-Partner (2022 – Present) Synetro Group, a private investment and strategic advisory firm ● Managing Partner (2021 – Present) General Catalyst, a venture capital firm ● Endurance Partner-in-Residence, XIR (2021 – 2022) Ancestry, a global family history and consumer genomics company ● President and Chief Executive Officer (2018 – 2020) Mattel, Inc., a leading global toy company and entertainment franchise ● Chief Executive Officer (2017 – 2018) Google Inc., a global technology company ● President, Americas (2011 – 2017) | Other Public Company Directorships Ms. Georgiadis also serves on the board of AppLovin Corporation. Committee Memberships: ● Audit & Finance ● Governance |
Biographical Information
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Biographical Information
| | Michael Hsu | | | | | | | | | | | | | | | | | | | | | CHAIRMAN AND CHIEF EXECUTIVE OFFICER, KIMBERLY-CLARK CORPORATION Age: 60 Board Tenure: 1 year | Brand Management | Customer- Centric | Digital | Finance / Capital Markets | Global Experience | Human Capital Management | Marketing | Other Public Company Boards | Sustainability / Corporate Responsibility | | | | Mr. Hsu brings to our Board extensive experience in consumer products, global supply chain, operations, e-commerce, digital and human capital management gained from his service in senior executive roles at Kimberly-Clark and Kraft Foods. His service at a leading manufacturer and consumer products retailer known for its advancement across multiple product categories also brings customer-centric experience to our Board. In addition, his experience in enhancing digital and e-commerce capabilities platforms is an important asset as our Board considers these topics and their potential impact on our Company. Mr. Hsu’s prior experience at Kraft Foods also gives him a unique perspective and expertise in the global food supply chain industry. His qualification as an “audit committee financial expert” is also an important attribute as a member of our Audit & Finance Committee. | | | | | | | |
Biographical Information
| Professional Experience Kimberly-Clark Corporation, a consumer products company ● Chairman and Chief Executive Officer (2020 – Present) ● Chief Executive Officer (2019 – 2020) ● President and Chief Operating Officer (2017 – 2019) ● Group President, Consumer Products, North America (2012 – 2017) Kraft Foods, a food service company ● Executive Vice President and Chief Commercial Officer (2012 – 2012) ● President, Sales, Customer Marketing and Logistics, USA (2010 – 2012) | Other Public Company Directorships Mr. Hsu also serves as Chairman of the Board of Kimberly-Clark Corporation. He previously served on the board of Texas Instruments Incorporated. Committee Memberships: ● Audit & Finance ● Corporate Responsibility |
Biographical Information
| 2025 Proxy Statement | 25 |
Biographical Information
| | Christopher Kempczinski | | | | | | | | | | | | | | | | | | | | | | | CHAIRMAN, PRESIDENT AND CHIEF EXECUTIVE OFFICER, MCDONALD’S CORPORATION Age: 56 Board Tenure: 5 years | Brand Management | Customer- Centric | Digital | Finance / Capital Markets | Global Experience | Human Capital Management | Marketing | Other Public Company Boards | Real Estate | Sustainability / Corporate Responsibility | | | | Mr. Kempczinski is Chairman, President and CEO of our Company, having previously served as President of McDonald’s USA, where he was responsible for approximately 14,000 McDonald’s restaurants. He first joined our Company in 2015, overseeing global strategy, business development and innovation. In these roles, he has been instrumental in identifying new ideas and best practices to accelerate growth to increase the overall value of the McDonald’s System. His experience leading our U.S. business and overseeing global strategy contributes an important Company perspective to our Board, and he was the architect of our Accelerating the Arches growth strategy. This experience and deep knowledge of the food industry strengthen our Board’s knowledge and understanding as it oversees our operations and strategy. | | | | | | | | |
Biographical Information
| ● ● ● ● ● | ● | | Professional Experience McDonald’s Corporation ● Chairman, President and Chief Executive Officer (2024 – Present) ● President and Chief Executive Officer (2019 – 2023) ● President, McDonald’s USA (2017 – 2019) ● Executive Vice President – Strategy, Business Development and Innovation (2015 – 2016) The Kraft-Heinz Company, a packaged food company ● Executive Vice President of Growth Initiatives and President of Kraft International (2014 – 2015) | Other Public Company Directorships Mr. Kempczinski also serves on the board of The Procter & Gamble Company. Committee Memberships: ● Executive (Chair since 2019) |
Biographical Information
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Biographical Information
| | Jennifer Taubert | | | | | | | | | | | | | | | | | | | EXECUTIVE VICE PRESIDENT AND WORLDWIDE CHAIRMAN, INNOVATIVE MEDICINE, JOHNSON & JOHNSON Age: 61 Board Tenure: 2 years | Brand Management | Customer- Centric | Finance / Capital Markets | Global Experience | Human Capital Management | Information Technology / Cybersecurity | Marketing | Sustainability / Corporate Responsibility | | | | Ms. Taubert brings to our Board extensive management, marketing, finance, business development and global operations experience gained from her senior executive roles at one of the world’s largest global healthcare companies. Her experience leading a global pharmaceuticals division, and as a member of Johnson & Johnson’s executive committee, provide her with a broad understanding of the range of complex issues facing a large, global consumer business. Our Board also benefits from Ms. Taubert’s extensive regulatory and public policy knowledge, as well as her human capital management experience and recognized leadership in the area of inclusion. | | | | | | |
Biographical Information
| ● ● ● | ● ● | | Professional Experience Johnson & Johnson, a researcher, developer and manufacturer of medical devices, and pharmaceuticals ● Executive Vice President and Worldwide Chairman, Innovative Medicine (2018 – Present) ● Company Group Chairman, The Americas, Pharmaceuticals (2015 – 2018) ● Company Group Chairman, North America, Pharmaceuticals (2012 – 2015) | Other Public Company Directorships None. Committee Memberships: ● Audit & Finance ● Compensation |
Biographical Information
| 2025 Proxy Statement | 27 |
Biographical Information
| | Paul Walsh | | | | | | | | | | | | | | | | | | | | | EXECUTIVE CHAIRMAN, MCLAREN GROUP LIMITED Age: 69 Board Tenure: 6 years | Brand Management | Customer- Centric | Digital | Finance / Capital Markets | Global Experience | Human Capital Management | Marketing | Other Public Company Boards | Sustainability / Corporate Responsibility | | | | Mr. Walsh brings to our Board substantial corporate leadership experience and knowledge of consumer-centric companies gained from his experience as former chief executive officer of a large multinational corporation. His experience at Diageo brings broader food and beverage industry perspective. He also has held executive-level finance positions, including as chief financial officer of Grand Metropolitan Foods and Intercontinental Hotels. Throughout his career, Mr. Walsh has built success and growth at his companies through the deployment of effective brand marketing strategies, which brings valuable perspective to our Board. His background as a UK national based in London provides international diversity on our Board. | | | | | | | |
Biographical Information
| ● ● ● ● ● ● ● | ● ● ● | | Professional Experience McLaren Group Limited, a privately owned luxury automotive and technology group ● Executive Chairman (2020 – Present) Chime Communications Limited, a marketing services company ● Advisor (2016 – Present) L.E.K. Consulting, a global strategy consulting firm ● Advisor (2014 – Present) TPG Capital LLP, a private investment firm ● Advisor (2014 – Present) Bespoke Capital Partners LLC, an investment company ● Operating Partner (2016 – 2021) Compass Group PLC, a leading food service and support services company ● Chairman (2014 – 2020) Diageo, plc, a multinational beverage company ● Chief Executive Officer (2000 – 2013) | Other Public Company Directorships Mr. Walsh also serves as a director of FedEx Corporation and UPL Ltd. He previously served on the boards of Compass Group PLC, RM2 International, S.A., TPG Pace Holdings Corp., and Vintage Wine Estates, Inc. (f/k/a Bespoke Capital Acquisition Corp.) Committee Memberships: ● Corporate Responsibility (Chair since 2022) ● Executive ● Governance |
Biographical Information
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Biographical Information
| | Amy Weaver | | | | | | | | | | | | | | | | | | | INCOMING CHIEF EXECUTIVE OFFICER, DIRECT RELIEF Age: 58 Board Tenure: 2 years | Brand Management | Customer- Centric | Digital | Finance / Capital Markets | Global Experience | Human Capital Management | Information Technology / Cybersecurity | Sustainability / Corporate Responsibility | | | | Ms. Weaver brings to our Board valuable and varied leadership experience gained from her senior executive roles at one of the world’s largest enterprise software companies. She previously led Salesforce’s global finance organization, and prior to that, led its legal and corporate affairs organizations. This contributes a unique and valuable perspective to our Board’s discussions of strategy, finance, regulatory and public policy matters. In addition, Ms. Weaver’s qualification as an “audit committee financial expert” is an important attribute as a member of our Audit & Finance Committee. | | | | | | |
Biographical Information
| ● – Present) ● – 2021) ● – 2020) ● – 2017) ● – 2015) | ● ● | | Professional Experience Direct Relief, a global humanitarian aid organization ● Chief Executive Officer (2025* – Present) Salesforce Inc., a cloud-based software company ● President and Chief Financial Officer (2021 – 2025) ● President and Chief Legal Officer (2020 – 2021) ● President, Legal Corporate Affairs and General Counsel (2017 – 2020) ● Executive Vice President and General Counsel (2015 – 2017) ● Senior Vice President and General Counsel (2013 – 2015) | Other Public Company Directorships None. Committee Memberships: ● Audit & Finance ● Governance |
Biographical Information
* Ms. Weaver is expected to become the CEO on May 5, 2025.
Biographical Information
| 2025 Proxy Statement | 29 |
Biographical Information
| | Miles White | | | | | | | | | | | | | | | | | | | FORMER EXECUTIVE CHAIRMAN, ABBOTT LABORATORIES Age: 70 Board Tenure: 16 years | Brand Management | Customer- Centric | Digital | Finance / Capital Markets | Global Experience | Human Capital Management | Marketing | Other Public Company Boards | | | | Mr. White brings to our Board extensive knowledge of strategy and business development, global operations, finance, leadership development and succession planning, corporate governance, and regulatory and public policy matters gained from his experience as former chairman and chief executive officer of a global healthcare company. Mr. White’s healthcare experience and knowledge of healthcare technology advances has also enhanced his ability to oversee human capital management. In addition, Abbott’s focus on developing consumer products and technologies brings customer-centric, marketing, digital and healthcare knowledge to our Board. We also benefit from Mr. White’s strong experience in addressing the needs of a global public company, as well as insights into our Board’s responsibility to oversee management and operations matters. As our Lead Independent Director and Governance Committee Chair, Mr. White leads our Board’s succession planning and Director candidate selection process, and he is periodically involved in shareholder engagement. | | | | | | |
Biographical Information
| ● ● | ● ● ● | | Professional Experience Abbott Laboratories, a global healthcare company ● Executive Chairman (2020 – 2021) ● Chairman and Chief Executive Officer (1999 – 2020) | Other Public Company Directorships Mr. White previously served as executive chairman of the board of Abbott Laboratories and as a director of Caterpillar, Inc. Committee Memberships: ● Governance (Chair since 2014) ● Compensation ● Executive |
Biographical Information
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Director Compensation
Director Compensation Non-management Directors are compensated for their service on our Board, as described below. Directors who are also Company employees do not receive any compensation for their service as Director. Our Governance Committee annually evaluates the compensation of our Directors. Consistent with this practice, in Spring 2024, our Board’s independent compensation consulting firm Semler Brossy Consulting Group LLC (“Semler Brossy”) performed a comprehensive review of both the structure of our non-management Director compensation program and amount of compensation, including benchmarking director compensation using the same peer group as is used for reviewing executive compensation, as described under “Compensation Discussion and Analysis” beginning on page 50. Informed by the results of this review and the base salary increase budget for employees, upon recommendation of the Governance Committee, the Board approved a $5,000 increase to the long-term equity component of the Director compensation package, effective May 22, 2024. No other changes were made to our Director compensation program in 2024. Our Director compensation program consists of: (i) an annual cash retainer of $120,000; and (ii) an annual grant of common stock equivalent units with a value of $205,000 under our Board of Directors’ Deferred Compensation Plan (the “Directors’ Plan”); (iii) an annual cash retainer of $30,000 for our Audit & Finance Committee Chair; and (iv) an annual cash retainer of
Director Compensation
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Director Compensation
$25,000 for the Chairs of our Compensation, Governance and Corporate Responsibility Committees. We also match up to $10,000 of charitable contributions made annually by Directors to eligible tax-exempt organizations. In recognition of his leadership as our Lead Independent Director, after considering market data provided by Semler Brossy, our disinterested Directors awarded Miles White an additional $50,000 cash retainer in 2024. Common stock equivalent units granted to Directors are credited to an account in the Directors’ Plan that reflects the gains, losses and dividends associated with a notional investment in our common stock and are settled following the Director leaving the Board. Common stock equivalent units so credited are based on a per-share price equal to the closing price of our common stock on the date the units are credited. In addition, Directors may elect to defer all or a portion of their cash retainers in the form of additional common stock equivalent units under the Directors’ Plan. Amounts Directors choose to defer from their retainer are deferred until a specified payment date, as determined by the Director in accordance with the Directors’ Plan. A Director may elect that all or a portion of the credited common stock equivalent units be paid in a lump sum or equal annual installments over a period of up to 15 years, beginning after retirement from our Board. Elections under the Directors’ Plan are irrevocable. In the event of death, amounts are paid in a lump sum. All amounts paid from the Directors’ Plan are paid in cash. The following table summarizes the compensation received by each non-management Director who served in 2024:
Director Compensation
| | FEES EARNED OR | STOCK | ALL OTHER | | | NAME | PAID IN CASH ($)(1) | AWARDS ($)(2) | COMPENSATION ($)(3) | TOTAL ($) | | Anthony Capuano | 120,000 | 203,060 | 10,000 | 333,060 | | Kareem Daniel | 120,000 | 203,060 | 10,000 | 333,060 | | Lloyd Dean | 145,000 | 203,060 | 10,000 | 358,060 | | Catherine Engelbert | 150,000 | 203,060 | 10,000 | 363,060 | | Margaret Georgiadis | 120,000 | 203,060 | 10,000 | 333,060 | | Enrique Hernandez, Jr.(4) | 145,357 | 78,356 | 10,000 | 233,713 | | Michael Hsu(5) | 73,187 | 125,464 | 10,000 | 208,651 | | John Mulligan | 134,130 | 203,060 | 10,000 | 347,191 | | Jennifer Taubert | 120,000 | 203,060 | 10,000 | 333,060 | | Paul Walsh | 145,000 | 203,060 | 10,000 | 358,060 | | Amy Weaver | 120,000 | 203,060 | 10,000 | 333,060 | | Miles White | 175,495 | 203,060 | 10,000 | 388,555 |
Director Compensation
| (1) As described above, Directors may defer all or a portion of their retainer earned in the form of additional common stock equivalent units under the Directors’ Plan. |
Director Compensation
| (2) These amounts represent the aggregate grant date fair value of common stock equivalent units computed in accordance with ASC 718 that were granted to each Director who served during 2024. The grant date fair value was determined based on our closing stock price on the date of grant. |
Director Compensation
| (3) Represents the amount of charitable contributions to tax-exempt organizations that the Company matched for Directors in 2024. No Director received perquisites or personal benefits in excess of $10,000 in the aggregate in 2024. |
Director Compensation
| (4) Mr. Hernandez retired from our Board on May 22, 2024, and received prorated compensation to reflect his service in 2024. |
Director Compensation
| (5) Mr. Hsu joined the Board on May 22, 2024, and received prorated compensation to reflect his service in 2024. |
Compensation
Compensation The Company’s 2024 operating income and Systemwide sales performance was below target, resulting in a Corporate STIP payout factor for NEOs of 27.6%. Despite the Company’s 2024 performance, the execution of our Accelerating the Arches growth strategy produced strong, multi-year performance, resulting in a 170.2% payout factor for the PRSUs awarded to our executives in 2022 that vested in early 2025 based on performance over the 2022-2024 performance period. These payouts demonstrate the Company’s strong pay-for-performance alignment for both the respective one- and three-year performance periods. The 2024 STIP payout factors highlight that our executives are held accountable to achieve rigorous performance targets despite the challenging external environment. The 2022-2024 PRSU payout factor was driven by two strong years of EPS and ROIC performance and strong shareholder returns over the three-year performance period. The graphics below highlight the strong alignment between Company performance and payout factors over the applicable performance periods.
Compensation
| 2024 STIP FINANCIAL PERFORMANCE VS TARGETS | | | Systemwide Sales Growth | Operating Income Growth | | | | | 2022–2024 PRSUs VS TARGETS | | | 3-Year Compound Annual Earnings Per Share (“EPS”) Growth | 3-Year Average Annualized Return on Invested Capital (“ROIC”) | | | |
First Principle: Pay for Performance
Our short-term incentive plan is based on a two strategic financial metrics that are aligned with our key measures of long-term sustainable growth. In addition, given the importance of restaurant development in driving top-line growth, the STIP includes a new restaurant opening metric, as well as a strategic scorecard that is designed to hold executives accountable for efforts towards advancing the Company’s values, driving employee engagement and executing its franchising strategy. The Committee establishes performance targets that are designed to be challenging, and payouts under our incentive plans can vary significantly based on performance.
First Principle: Pay for Performance
| KEY 2024 METRICS | | | | STIP | PRSUs | | | ● Operating Income Growth ● Systemwide Sales Growth ● New Restaurant Openings ● Strategic Scorecard | ● Earnings Per Share (“EPS”) Growth ● Return on Invested Capital (“ROIC”) ● Total Shareholder Return (“TSR”) | |
Second Principle: Drive Business Results & Long-Term Value Creation
Second Principle: Drive Business Results & Long-Term Value Creation While we believe it is important to reward success against short-term goals, our overall focus is on driving long-term shareholder value. The Committee regularly considers how our compensation program supports our current business strategy, as described below. In order to incentivize long-term value creation, we have delivered approximately 75% of our CEO’s compensation opportunity in the form of long-term incentive awards that vest over several years. Further, the performance-based compensation programs are designed to require growth over prior year results to yield any payout.
2024 Short-Term Cash Incentive (STIP)
2024 Short-Term Cash Incentive (STIP) The design of our executive compensation program for 2024 was generally consistent with 2023, which the Committee believes was closely aligned with the Company’s strategic priorities and motivates our executives to produce strong business results. For the 2024 STIP, the Committee retained operating income, Systemwide sales, and new restaurant openings (which together account for 85% of the award) as core metrics and added a strategic scorecard designed to hold executives accountable for efforts towards advancing the Company’s values, driving employee engagement and executing its franchising strategy (accounting for 15% of the award). The Committee believes this combination of metrics reflects the appropriate balance of driving both top- and bottom-line growth and motivating leaders to achieve key business objectives that are deemed critical to our Accelerating the Arches growth strategy. Refer to “Short-Term Cash Incentive (STIP)” beginning on page 58 for more information. The Committee continues to believe the metrics, and their relative weightings, in the Company’s 2024 design are closely aligned with our Accelerating the Arches strategy and retained Systemwide sales, operating income, new restaurant openings and a refined qualitative strategic scorecard for 2025 STIP awards.
2024 Performance-Based Restricted Stock Units (PRSUs)
2024 Performance-Based Restricted Stock Units (PRSUs) The Company’s 2024 PRSU design is also closely tied to the Accelerating the Arches growth strategy and drives long-term, sustainable growth. Consistent with the 2023 PRSU design, the 2024 PRSU design includes EPS growth and ROIC as core
2024 Performance-Based Restricted Stock Units (PRSUs)
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2024 Performance-Based Restricted Stock Units (PRSUs)
metrics, as well as a relative TSR modifier. The Committee believes the PRSU design appropriately incentivizes executives to drive long-term shareholder value. Refer to “Long-Term Incentive Compensation” beginning on page 60 for more information. The Committee continues to believe the metrics, and their relative weightings, in the 2024 PRSU design are closely aligned with our Accelerating the Arches strategy and retained EPS and ROIC as core metrics for 2025 PRSU awards.
input from our compensation consultant
input from our compensation consultant The Committee’s independent compensation consultant reviews and provides input on overall compensation design and NEO target compensation opportunities.
Independent Compensation Consultant
Independent Compensation Consultant The Committee has the sole authority to retain and dismiss an independent compensation consultant. The Committee has engaged Semler Brossy Consulting Group LLC (“Semler Brossy”) as its independent compensation consultant. Consistent with its Charter, the Committee regularly considers its compensation consultant’s independence. In October 2024, the Committee concluded that Semler Brossy is independent and that its work for the Committee did not raise any conflicts of interest. Management may not engage the Committee’s consultant for any purpose.
Peer Companies
Peer Companies Consistent with our goal of providing competitive compensation to motivate and retain executive talent, we review compensation practices and levels for a group of peer companies that we believe best reflect our business. In setting target compensation levels for our executives, we use the market median for each compensation element as a reference point; however, we do not specifically target any element of compensation at a particular percentile.
Peer Companies
| 2025 Proxy Statement | 55 |
Peer Companies
Annually, based on input from Semler Brossy and management, the Committee selects a peer group comprised of companies with which we compete for talent, including our direct competitors, major retailers, producers of consumer branded goods and companies with a significant global presence, based on the following screens:
Peer Companies
| Size | Covered Industries | Strategic Criteria | | | | | | ● Companies with revenue and a market cap in the range of 0.25 to four times those of our Company | ● Restaurants and leisure ● Retail ● Consumer products ● Technology ● Food and beverage | ● Iconic global brand ● Global business ● Talent market competitor |
Peer Companies
The following table sets forth our 2024 peer group, which was the same peer group used to evaluate executive compensation decisions for 2023. The graphic below compares the market capitalization of these companies to McDonald’s.
Peer Companies
| ● The Coca-Cola Company ● Colgate Palmolive Company ● Johnson & Johnson ● The Kraft-Heinz Company ● Marriott International, Inc. ● Mastercard Incorporated ● Mondelēz International, Inc. ● NIKE, Inc. | ● PepsiCo, Inc. ● The Procter & Gamble Company ● Starbucks Corporation ● Target Corporation ● Visa Inc. ● Walgreens Boots Alliance ● Wal-Mart Inc. ● Yum! Brands Inc. | |
Peer Companies
In July 2024, the Committee approved updates to the Company’s peer group by adding The Walt Disney Company and removing Johnson & Johnson and Walgreens Boots Alliance. These changes will be effective and used for 2025 compensation decisions.
Peer Companies
| 56 | |
Short-Term Cash Incentive (STIP)
Short-Term Cash Incentive (STIP) In setting individual STIP targets, the Committee considers a variety of factors, including individual performance, experience, market competitiveness, retention, succession, and internal equity considerations. The Committee considered these factors and determined not to increase the STIP target for four of the NEOs and increased the 2024 STIP target for Mr. Borden from 125% to 130%.
Short-Term Cash Incentive (STIP)
| NAMED EXECUTIVE OFFICER | 2023 STIP (%) | 2024 STIP (%) | | Christopher Kempczinski | 200 | 200 | | Ian Borden | 125 | 130 | | Joseph Erlinger | 120 | 120 | | Gillian McDonald | 120 | 120 | | Desiree Ralls-Morrison | 100 | 100 |
Short-Term Cash Incentive (STIP)
| 58 | |
Short-Term Cash Incentive (STIP)
| For 2024, the STIP design was aligned with our Accelerating the Arches strategy and rewarded growth in operating income, Systemwide sales, new restaurant openings and performance against a new strategic scorecard. Operating income growth requires us to balance increases in revenue with financial discipline to produce strong margins and cash flow. Systemwide sales is an important metric in a franchise business as income generation is closely correlated to sales growth and it is a measure of the financial health of our franchisees. The new restaurant openings metric measures restaurants opened in our U.S. and International Operated Markets (“IOM”) segments and reflects the importance of restaurant development in driving top-line growth as part of our Accelerating the Arches strategy. In 2024, the STIP design was updated to include a strategic scorecard that holds management accountable for efforts towards advancing the Company’s values, driving employee engagement and executing its franchising strategy. |
Short-Term Cash Incentive (STIP)
The chart below provides the operating income growth, Systemwide sales growth, and new restaurant openings necessary to achieve threshold, target, and maximum payouts under the 2024 STIP for the Corporate segment. Consistent with prior years, the operating income and Systemwide sales performance targets required growth over prior year results to receive a payout. STIP payouts are capped at 200% of the target award.
Short-Term Cash Incentive (STIP)
| 2024* | THRESHOLD | TARGET* | MAXIMUM | | Operating income growth | 0% | 5.9% | 15.9% | | Systemwide sales growth | 0% | 6.1% | 14.2% | | New restaurant openings | 442 | 489 | 518 |
Short-Term Cash Incentive (STIP)
| * Payout percentage interpolated for results that fall between each of the performance levels specifically identified. The maximum payout as a percentage of target was 240% for the operating income growth and Systemwide sales growth metrics and 133% for the new restaurant openings and strategic scorecard metrics. |
Performance vs. 2024 STIP Targets
Performance vs. 2024 STIP Targets The following table shows the operating income, Systemwide sales, and new restaurant opening targets and results under the 2024 STIP for the Corporate, U.S. and IOM segments.
Performance vs. 2024 STIP Targets
| | OPERATING INCOME (“OI”)* (40% WEIGHTING) | | | | SYSTEMWIDE SALES ("SWS") (30% WEIGHTING) | | | | NEW RESTAURANT OPENINGS (“NRO”) (15% WEIGHTING) | | | | | TARGET 2024 | | 2024 | | TARGET 2024 | | 2024 | | | | | | OI GROWTH | 2024 | ADJUSTED | | SWS GROWTH | 2024 | ADJUSTED | | | | | TARGET | OVER | ADJUSTED | OI GROWTH | TARGET | OVER | ADJUSTED | SWS GROWTH | TARGET | | | | 2024 OI | 2023 | OI | OVER 2023 | 2024 SWS | 2023 | SWS | OVER 2023 | 2024 NRO | 2024 NRO | | | ($B) | (%) | ($B) | (%) | ($B) | (%) | ($B) | (%) | (#) | (#) | | Corporate | 12.7 | 5.9 | 12.0 | 0.1 | 137.3 | 6.1 | 131.6 | 1.6 | 489 | 466 | | U.S. | 6.2 | 6.9 | 5.7 | (0.6) | 55.9 | 5.3 | 53.5 | 0.6 | 140 | 141 | | IOM | 6.3 | 7.0 | 5.9 | 0.0 | 46.8 | 6.4 | 44.7 | 1.6 | 349 | 325 |
Performance vs. 2024 STIP Targets
| * The 2024 operating income target and results above have been adjusted in accordance with the Committee’s pre-established guidelines. See pages 62 and 63 for further information on the Committee’s guidelines as well as 2024 STIP adjustments. |
Performance vs. 2024 STIP Targets
| 2025 Proxy Statement | 59 |
Performance vs. 2024 STIP Targets
For 2024, our strategic scorecard was designed to hold management accountable for efforts towards advancing the Company’s values, driving employee engagement and executing its franchising strategy. Performance was evaluated qualitatively, informed by quantitative results. The strategic scorecard represented 15% weighting in the STIP at target, with the opportunity to earn from 0 to 20 STIP points. The strategic scorecard was designed to require significant efforts in order to be allocated STIP points and outsized efforts in order to receive maximum payout. The Committee qualitatively evaluated the Company’s efforts and performance with respect to the areas of focus within the strategic scorecard and awarded the NEOs 75% or 11.3 points for their efforts and achievements.
Individual 2024 STIP Payouts
Individual 2024 STIP Payouts The 2024 STIP target and actual payouts for our NEOs are shown in the following table. The 2024 STIP payouts for Mr. Kempczinksi, Mr. Borden and Ms. Ralls-Morrison were based on Corporate performance, while the 2024 STIP payouts for Ms. McDonald and Mr. Erlinger were based on their segment and Corporate performance, respectively, in order to more directly tie their 2024 STIP payouts to their areas of responsibility.
Individual 2024 STIP Payouts
| | | | TARGET | | | | | | | | 2024 STIP | | | 2024 STIP | | | | | PAYMENT AS | 2024 | | PAYMENT AS | | | APPLICABLE TEAM | PERFORMANCE | PERCENT OF | TARGET STIP | 2024 STIP | PERCENT OF | | NAMED EXECUTIVE OFFICER | FACTORS | FACTORS (%) | SALARY (%) | PAYOUT ($) | PAYOUT ($) | TARGET (%) | | Christopher Kempczinski | Corporate (85%) | 19.2 | 200 | 3,100,000 | 854,670 | 27.6 | | | Strategic Scorecard (15%) | 75 | | | | | | Ian Borden | Corporate (85%) | 19.2 | 130 | 1,235,000 | 340,490 | 27.6 | | | Strategic Scorecard (15%) | 75 | | | | | | Joseph Erlinger | U.S. (63.75%) | 23.0 | 120 | 1,050,000 | 314,922 | 30.0 | | | Corporate (21.25%) | 19.2 | | | | | | | Strategic Scorecard (15%) | 75 | | | | | | Gillian McDonald(1) | IOM (63.75%) | 13.5 | 120 | 1,081,243 | 258,810 | 23.9 | | | Corporate (21.25%) | 19.2 | | | | | | | Strategic Scorecard (15%) | 75 | | | | | | Desiree Ralls-Morrison | Corporate (85%) | 19.2 | 100 | 850,000 | 234,345 | 27.6 | | | Strategic Scorecard (15%) | 75 | | | | |
Individual 2024 STIP Payouts
| (1) Ms. McDonald’s 2024 target STIP payout has been converted to USD based on the average monthly exchange rate for 2024 of 1 GBP = 1.27 USD. |
Long-Term Incentive Compensation
Long-Term Incentive Compensation Consistent with prior years, our long-term incentive compensation in 2024 consisted 50% of PRSUs and 50% of stock options. The Committee believes this mix of awards supports our pay-for-performance philosophy. Executives are motivated by PRSUs to achieve robust financial performance targets over a three-year period, and stock options focus executives on actions that create shareholder value over the long term.
Long-Term Incentive Compensation
| 60 | |
Setting 2024 Long-Term Incentive Award Values
Setting 2024 Long-Term Incentive Award Values In determining the long-term incentive awards, the Committee considers several factors, including market practices, scope of responsibilities, individual performance, tenure in position, internal pay equity and the effect on our general and administrative expenses. As in the prior year, the Committee elected to deliver the majority of Mr. Kempczinski’s 2024 total compensation increase in the form of additional long-term incentive awards to further align his interests with the Company’s shareholders. Mr. Kempczinski’s target long-term incentive award was increased as a result of his strong leadership during his tenure as CEO and to further align his compensation with the Company’s target pay philosophy and to more competitively align his compensation within our peer group. The Committee also approved increases to the target long-term incentive awards for Mr. Borden and Ms. McDonald in order to better reflect market competitiveness for their roles. The following table illustrates the 2023 and 2024 target annual long-term incentive award values for our NEOs, including the approved increases as described above.
Setting 2024 Long-Term Incentive Award Values
| NAMED EXECUTIVE OFFICER | 2023 AWARD VALUE ($) | 2024 AWARD VALUE ($) | | Christopher Kempczinski | 13,000,000 | 15,000,000 | | Ian Borden | 4,000,000 | 4,750,000 | | Joseph Erlinger | 3,750,000 | 3,750,000 | | Gillian McDonald | 2,750,000 | 3,750,000 | | Desiree Ralls-Morrison | 2,600,000 | 2,600,000 |
Performance-Based Restricted Stock Units (PRSUs)
Performance-Based Restricted Stock Units (PRSUs)
2024 PRSU Awards
2024 PRSU Awards Consistent with prior years, 50% of the target annual long-term incentive award values for our NEOs were granted in the form of PRSUs. PRSUs provide the right to receive a share of our common stock, subject to certain vesting requirements, and accrue dividend equivalent rights that are reinvested in additional PRSUs and earned in proportion to and only to the extent the underlying PRSUs vest. These awards also align the interests of our NEOs with those of our shareholders by delivering payouts in the form of our common stock. PRSUs granted in 2024 will vest on the third anniversary of the grant date, subject to our achievement of two key financial metrics, EPS growth (weighted 75%) and ROIC (weighted 25%). The Committee incorporated the planned level of share repurchases in setting the EPS targets. The PRSUs are also subject to a modifier based on our relative TSR performance measured over the three-year performance period vs. the S&P 500 Index. The Committee believes this balanced set of metrics encourages executives to increase profitability through the efficient and effective use of capital, which will enhance shareholder value. The relative TSR modifier can increase or decrease payout based on the Company’s performance relative to the S&P 500 index, rewarding NEOs for Company outperformance and reducing payouts if Company performance lags. The PRSUs are also subject to a cap of 100% of target if our absolute TSR for the three-year performance period is negative, which further supports our commitment to ensuring that the interests of executives are aligned with those of our shareholders. Maximum payout of PRSUs is limited to 200% of the target award (subject to a modifier of up to an additional 25 percentage points based on our relative TSR vs. the S&P 500 Index over the performance period), plus any dividend equivalents earned on the PRSUs.
2024 PRSU Awards
| * Payout percentage interpolated for results that fall between each of the performance levels specifically identified. |
2024 PRSU Awards
| * Payouts between 20th and 79th percentiles will be interpolated. |
2022 PRSU Payouts
2022 PRSU Payouts In 2022, the Committee granted PRSUs to our executives, which were subject to EPS, ROIC and relative TSR performance metrics for the 2022–2024 performance period. Driven by the execution of our Accelerating the Arches growth strategy and strong results in 2022 and 2023, the Company achieved well above-target performance for both our EPS growth and ROIC and our TSR was at the 57th percentile compared to the S&P 500 Index, resulting in the PRSUs vesting at 170.2% of the target amount in early 2025.
Stock Options
Stock Options The remaining 50% of the target annual long-term incentive award values for our NEOs were granted in the form of options. Options granted to our NEOs have an exercise price equal to the closing price of our common stock on the grant date, a term of ten years and vest ratably over four years, subject to continued service. Options provide value only if our share price increases, thereby closely aligning executive pay with shareholder interests and our pay for performance philosophy.
2024 STIP Adjustments
2024 STIP Adjustments
2024 STIP Adjustments
| | | CATEGORY | ADJUSTMENTS | ADJUSTMENT TO OPERATING INCOME ($M)* | | | Strategic | Asset impairment and gains/losses related to strategic initiatives, including restructurings, acquisitions, divestitures, and developmental licensee transactions | Exclude costs associated with continued transformation in support of our Accelerating the Arches strategic plan | 221 | | | | | Exclude transaction costs and non-cash impairment charges associated with the sale of our business in South Korean and acquisition of our business in Israel | 51 | | | Regulatory | Changes in tax or accounting law or regulations | N/A | N/A | | | External | Extraordinary, unforeseeable events, such as natural disasters or the impact of social or political unrest that are outside of management’s control | N/A | N/A |
2024 STIP Adjustments
| * Pre-tax amounts in millions. The amounts in the table for each segment sum to the total adjustments identified below for the respective segment. |
2024 STIP Adjustments
The following chart provides the net adjustment (other than for foreign currency translation), as described above, by segment, made to 2024 operating income for purposes of calculating STIP payouts. There were no adjustments made to Systemwide sales.
2024 STIP Adjustments
| | Operating Income ($M) | | Corporate | 272 | | U.S. | — | | International Operated Markets (IOM) | — |
Severance & Change in Control Arrangements
Severance & Change in Control Arrangements We have a U.S. severance plan that covers all U.S.-based officers, including our NEOs. Benefits under the U.S. severance plan are described under “Potential Payments Upon Termination of Employment or Change in Control” beginning on page 70. Ms. McDonald is not covered by the U.S. Severance Plan, and pursuant to the terms of her offer letter, Ms. McDonald is entitled to 26 weeks’ advanced written notice of a termination of her employment (or a payment in lieu of such notice) for any reason other than her gross misconduct or persistent and continued misconduct. We do not have any change in control agreements, and we do not provide for any single-trigger change of control benefits or Section 280G tax gross-up payments. Refer to the “Potential Payments Upon Termination of Employment or Change in Control” for further information regarding the severance benefits payable to our NEOs in the event of a termination of employment.
Compensation Recoupment & Forfeiture Provisions
Compensation Recoupment & Forfeiture Provisions The Company has adopted a clawback policy intended to comply with the SEC rules and NYSE listing standards that require the Company to recoup certain incentive-based compensation erroneously awarded to current and former executive officers of the Company in the event the Company is required to file certain financial restatements. In addition, our STIP awards and long-term incentive grant agreements for executives provide that we may terminate awards and/or recapture previously paid awards if a participant engages in willful fraud that (i) causes harm to our Company or (ii) is intended to manipulate performance goals either during employment, or after employment has terminated. Furthermore, our executives have executed restrictive covenants. An executive who violates the restrictive covenants to which they are subject will forfeit outstanding long-term incentive awards, whether or not vested, and may be required to repay awards that have previously been paid.
11. Mitigating Risk in Executive Compensation
| ● | balance of short- and long-term incentives; |
11. Mitigating Risk in Executive Compensation
| ● | objective performance metrics related to various measures of operational performance; |
11. Mitigating Risk in Executive Compensation
| ● | diverse time horizons for incentive awards; |
11. Mitigating Risk in Executive Compensation
| ● | caps on all incentive payouts; |
2024 Summary Compensation Table
2024 Summary Compensation Table The following table summarizes the total compensation earned by our NEOs in 2024, 2023, and, if required, 2022.
2024 Summary Compensation Table
| | | | | | NON-EQUITY | | | | NAME AND | | | STOCK | OPTION | INCENTIVE PLAN | ALL OTHER | | | PRINCIPAL POSITION | YEAR | SALARY | AWARDS | AWARDS | COMPENSATION | COMPENSATION | TOTAL | | (a) | (b) | ($)(c)(1) | ($)(e)(2) | ($)(f)(3) | ($)(g) | ($)(i)(4) | ($)(j) | | Christopher Kempczinski | 2024 | 1,529,167 | 7,500,146 | 7,500,052 | 854,670 | 811,228 | 18,195,263 | | Chairman, President and CEO | 2023 | 1,417,500 | 6,500,181 | 6,500,043 | 4,027,620 | 709,657 | 19,155,001 | | | 2022 | 1,368,833 | 5,750,227 | 5,750,012 | 4,240,878 | 660,564 | 17,770,514 | | Ian Borden | 2024 | 941,667 | 2,375,275 | 2,375,033 | 340,490 | 279,165 | 6,311,630 | | Executive Vice President and Global CFO | 2023 | 900,000 | 2,000,162 | 2,000,026 | 1,589,850 | 315,432 | 6,805,470 | | | 2022 | 847,257 | 1,625,070 | 1,625,032 | 1,807,170 | 2,018,558 | 7,923,087 | | Joseph Erlinger | 2024 | 869,167 | 1,875,265 | 1,875,058 | 314,922 | 1,176,953 | 6,111,365 | | President, McDonald’s USA | 2023 | 840,000 | 1,875,238 | 1,875,021 | 1,638,492 | 180,046 | 6,408,797 | | | 2022 | 835,833 | 1,750,034 | 1,750,002 | 1,346,315 | 235,838 | 5,918,022 | | Gillian McDonald(5) | 2024 | 889,320 | 1,875,265 | 1,875,058 | 258,810 | 151,514 | 5,049,967 | | President, International Operated Markets | 2023 | 808,365 | 4,125,589 | 2,125,031 | 1,296,651 | 145,288 | 8,500,924 | | Desiree Ralls-Morrison | 2024 | 845,833 | 1,300,208 | 1,300,008 | 234,345 | 148,484 | 3,828,878 | | Executive Vice President, Global Chief | 2023 | 820,833 | 1,300,092 | 1,300,052 | 1,165,890 | 139,508 | 4,726,375 | | Legal Officer | 2022 | 800,000 | 1,200,194 | 1,200,041 | 1,106,316 | 469,196 | 4,775,747 |
2024 Summary Compensation Table
| (1) Annual base salaries as of December 31, 2024 for our NEOs were as follows: Mr. Kempczinski: $1,550,000; Mr. Borden: $950,000; Mr. Erlinger: $875,000; Ms. McDonald: $901,000 (GBP 705,000) ; Ms. Ralls-Morrison: $850,000. |
2024 Summary Compensation Table
| (2) Represents the aggregate grant date fair value of performance-based restricted stock units (“PRSUs”) granted under the McDonald’s Corporation Amended and Restated 2012 Omnibus Stock Ownership Plan (the “Equity Plan”), based on the probable outcome of the applicable performance conditions and excluding the effect of estimated forfeitures during the applicable vesting periods of PRSUs, as computed in accordance with Accounting Standards Codification (“ASC”) 718. Values generally are based on the closing price of the Company’s common stock on the grant date. Except as otherwise described herein, PRSUs vest on the third anniversary of the grant date and are subject to performance-based vesting conditions linked to the achievement of earnings per share (“EPS”) growth, return on invested capital (“ROIC”) and a relative total shareholder return (“TSR”) modifier over the performance period (as described beginning on page 61). PRSUs are subject to a cap of 200% of target. Further, if the Company’s absolute TSR for the three-year performance period is negative, then the cap is 100% of target. The fair value of PRSUs that include the TSR modifier is determined using a Monte Carlo valuation model. Assuming the highest level of performance is achieved for the 2024 PRSU awards, the maximum value of these awards at the grant date would be as follows: Mr. Kempczinski: $15,000,292; Mr. Borden: $4,750,550; Mr. Erlinger $3,750,530; Ms. McDonald: $3,750,530; Ms. Ralls-Morrison $2,600,416. |
2024 Summary Compensation Table
A more detailed discussion of the assumptions used in the valuation of equity awards (including PRSUs) may be found in the Notes to Consolidated Financial Statements under “Share-based Compensation” on pages 63 and 64 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
2024 Summary Compensation Table
| (3) Represents the aggregate grant date fair value of options granted under the Equity Plan, excluding the effect of estimated forfeitures during the applicable vesting periods of options, as computed in accordance with ASC 718. Options have an exercise price equal to the closing price of the Company’s common stock on the grant date and vest in equal installments over a four-year period. Values for options granted in 2024 are determined using a closed-form pricing model based on the following assumptions, as described in the footnotes to the consolidated financial statements: expected volatility based on historical experience of 21.2%; an expected annual dividend yield of 2.3%; a risk-free return of 4.1%; and expected option life based on historical experience of 5.8 years. Additional information about options is disclosed in the 2024 Grants of Plan-Based Awards table on page 67 and the Outstanding Equity Awards at 2024 Year-End table on page 68. A more detailed discussion of the assumptions used in the valuation of option awards may be found in the Notes to Consolidated Financial Statements under “Share-based Compensation” on pages 63 and 64 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. |
2024 Summary Compensation Table
| (4) “All other compensation” for 2024 includes the Company’s contributions to its 401(k) Plan and Amended & Restated Deferred Compensation Plan, except for Ms. McDonald who receives an allowance in lieu of participating in our UK retirement plan. Details on the Company’s contributions to its 401(k) Plan and Amended & Restated Deferred Compensation Plan and the allowance provided to Ms. McDonald are below: |
2024 Summary Compensation Table
| Christopher Kempczinski | $341,006 | | Ian Borden | $155,079 | | Joseph Erlinger | $153,613 | | Gillian McDonald | $111,165 | | Desiree Ralls-Morrison | $123,133 |
2024 Summary Compensation Table
The Company’s incremental cost of perquisites is included in the amounts provided in this column and based on actual charges to the Company. This column also includes the following categories of perquisites: financial counseling; annual physical examinations for the executives and their spouses; executive security (for select NEOs); website monitoring services (including for Mr. Kempczinski’s spouse); matching charitable donations; Company-paid life insurance (for U.S.-based NEOs); and for select NEOs, limited personal benefits for the NEO’s spouses in connection with the Company’s WorldWide Convention in Spain. Ms. McDonald received a car allowance in the amount of $30,929. In addition, this column includes the cost of the personal use of the Company’s aircraft by the CEO, which include fuel, on-board catering, landing/handling fees, hourly maintenance costs and crew costs attributable to personal flights and excluding fixed costs, such as pilot salaries and the cost of the aircraft. In addition to personal flights with a cost of $400,000, Mr. Kempczinski used the Company’s aircraft to travel to outside Board meetings at a cost of $31,635 in 2024. In certain circumstances, the CEO may permit other executives to use the aircraft for personal travel or to be joined by their spouses on the aircraft for business travel. In 2024, Messrs. Kempczinski and Erlinger received benefits related to spousal travel to business events; however, this travel did not result in any incremental cost to the Company. For all NEOs, the amount reported also includes personal costs associated with an offsite business meeting, including in some cases, spousal costs. The Company does not provide any tax gross-ups on the perquisites described above. Mr. Borden and Mr. Erlinger received certain benefits related to previous international assignments. Mr. Borden received tax preparation services in the amount of $48,652 and tax equalization in the amount of $40,296. Mr. Erlinger received tax preparation services, as well as tax equalization in the amount of $982,276.
2024 Summary Compensation Table
| 66 | |
2024 Summary Compensation Table
| (5) Certain amounts for Ms. McDonald were paid in British Pounds and, when the exact payment date is available, reflect the exchange rate on the date the respective payments were made. When information is not available, the amounts reflect the average monthly exchange rate for the reporting year. |
2024 Grants of Plan-Based Awards
2024 Grants of Plan-Based Awards
2024 Grants of Plan-Based Awards
| | | | | | | | | | ALL OTHER | | GRANT | | | | | | | | | | | OPTION | EXERCISE | DATE FAIR | | | | | | | | | | | AWARDS: | OR BASE | VALUE OF | | | | | ESTIMATED FUTURE PAYOUTS | | | ESTIMATED FUTURE PAYOUTS | | | NUMBER OF | PRICE OF | STOCK | | | | | UNDER NON-EQUITY | | | UNDER EQUITY | | | SECURITIES | OPTION | AND | | | | | INCENTIVE PLAN AWARDS(1) | | | INCENTIVE PLAN AWARDS | | | UNDERLYING | AWARDS | OPTION | | NAME | | GRANT DATE | THRESHOLD | TARGET | MAXIMUM | THRESHOLD | TARGET | MAXIMUM | OPTION | ($/SH) | AWARDS | | (a) | PLAN | (b) | ($)(c) | ($)(d) | ($)(e) | (#)(f) | (#)(g) | (#)(h) | (#)(j) | (k) | ($)(l)(2) | | Christopher Kempczinski | STIP | 2/12/2024 | 0 | 3,100,000 | 6,200,000 | | | | | | | | | Equity Plan(3) | 2/12/2024 | | | | 0 | 24,585 | 49,170 | | | 7,500,146 | | | Equity Plan(4) | 2/12/2024 | | | | | | | 125,377 | 289.44 | 7,500,052 | | Ian Borden | STIP | 2/12/2024 | 0 | 1,235,000 | 2,470,000 | | | | | | | | | Equity Plan(3) | 2/12/2024 | | | | 0 | 7,786 | 15,572 | | | 2,375,275 | | | Equity Plan(4) | 2/12/2024 | | | | | | | 39,703 | 289.44 | 2,375,033 | | Joseph Erlinger | STIP | 2/12/2024 | 0 | 1,050,000 | 2,100,000 | | | | | | | | | Equity Plan(3) | 2/12/2024 | | | | 0 | 6,147 | 12,294 | | | 1,875,265 | | | Equity Plan(4) | 2/12/2024 | | | | | | | 31,345 | 289.44 | 1,875,058 | | Gillian McDonald | STIP | 2/12/2024 | 0 | 1,081,243 | 2,162,486 | | | | | | | | | Equity Plan(3) | 2/12/2024 | | | | 0 | 6,147 | 12,294 | | | 1,875,265 | | | Equity Plan(4) | 2/12/2024 | | | | | | | 31,345 | 289.44 | 1,875,058 | | Desiree Ralls-Morrison | STIP | 2/12/2024 | 0 | 850,000 | 1,700,000 | | | | | | | | | Equity Plan(3) | 2/12/2024 | | | | 0 | 4,262 | 8,524 | | | 1,300,208 | | | Equity Plan(4) | 2/12/2024 | | | | | | | 21,732 | 289.44 | 1,300,008 |
2024 Grants of Plan-Based Awards
| (1) Each NEO received an annual cash award under the STIP. The 2024 STIP measured Company performance based on operating income growth (40%), Systemwide sales growth (30%), new restaurant openings (15%) and a strategic scorecard (15%). Target awards were established based on a percentage of salary. Achievement of targets results in a 100% payout. Actual payouts are based on achievement of the metrics and can range from 0% to 200% of target. Columns (d) and (e) above show the target and maximum award payouts. Actual STIP payouts are shown in column (g) of the 2024 Summary Compensation Table on page 66. See the CD&A beginning on page 50 for a further discussion. |
2024 Grants of Plan-Based Awards
| (2) The values in this column were determined based on the assumptions described in footnote 2 and 3, respectively, to the 2024 Summary Compensation Table on page 66. |
2024 Grants of Plan-Based Awards
| (3) The PRSUs received by the NEOs, as shown in columns (f), (g), (h) and (i), have dividend equivalent rights. The PRSUs are scheduled to vest on February 12, 2027, subject to achievement of positive three-year average annual EPS growth (75% weight) and three-year ROIC (25% weight) of at least 16%. If performance against EPS and ROIC meets the threshold for a payout, a relative TSR modifier can impact final payouts by up to plus or minus 25 percentage points. The maximum payout is 200% of target, provided that if absolute TSR for the three-year period is negative, the maximum payout is 100% of target. See the discussion beginning on page 61 for more information. |
2024 Grants of Plan-Based Awards
| (4) Reflects option grants, which vest 25% on each of the first four anniversaries of the grant date. For details regarding options, refer to footnote 3 to the 2024 Summary Compensation Table on page 66. |
2024 Grants of Plan-Based Awards
| 2025 Proxy Statement | 67 |
Outstanding Equity Awards at 2024 Year-End
Outstanding Equity Awards at 2024 Year-End
Outstanding Equity Awards at 2024 Year-End
| | OPTION AWARDS | | | | STOCK AWARDS | | | | | | | | | | | MARKET | EQUITY INCENTIVE | EQUITY INCENTIVE | | | NUMBER OF | NUMBER OF | | | NUMBER OF | VALUE OF | PLAN AWARDS: | PLAN AWARDS: | | | SECURITIES | SECURITIES | | | SHARES OR | SHARES OR | NUMBER OF | MARKET OR PAYOUT | | | UNDERLYING | UNDERLYING | | | UNITS OF | UNITS OF | UNEARNED | VALUE OF UNEARNED | | | UNEXERCISED | UNEXERCISED | OPTION | OPTION | STOCK THAT | STOCK THAT | SHARES, UNITS OR | SHARES, UNITS OR | | | OPTIONS | OPTIONS | EXERCISE | EXPIRATION | HAVE NOT | HAVE NOT | OTHER RIGHTS THAT | OTHER RIGHTS THAT | | NAME | EXERCISABLE | UNEXERCISABLE | PRICE | DATE | VESTED | VESTED | HAVE NOT VESTED | HAVE NOT VESTED | | (a) | (#)(b)(1) | (#)(c)(1) | ($)(e) | (f) | (#)(g)(2) | ($)(h)(3) | (#)(i)(4) | ($)(j)(3)(4) | | Christopher Kempczinski | 52,553 | 0 | 128.09 | 3/8/2027 | | | | | | | 42,017 | 0 | 157.79 | 2/19/2028 | | | | | | | 48,829 | 0 | 174.15 | 2/13/2029 | | | | | | | 161,565 | 0 | 216.15 | 2/18/2030 | | | | | | | 169,848 | 56,616 | 215.03 | 2/16/2031 | | | | | | | 68,259 | 68,256 | 253.39 | 2/14/2032 | | | | | | | 29,899 | 89,697 | 266.20 | 2/13/2033 | | | | | | | 0 | 125,377 | 289.44 | 2/12/2034 | | | 88,420 | 25,632,074 | | Ian Borden | 17,134 | 0 | 116.73 | 2/11/2026 | | | | | | | 27,028 | 0 | 128.09 | 3/8/2027 | | | | | | | 26,261 | 0 | 157.79 | 2/19/2028 | | | | | | | 29,297 | 0 | 174.15 | 2/13/2029 | | | | | | | 32,313 | 0 | 216.15 | 2/18/2030 | | | | | | | 51,561 | 17,187 | 215.03 | 2/16/2031 | | | | | | | 19,291 | 19,290 | 253.39 | 2/14/2032 | | | | | | | 9,202 | 27,597 | 266.20 | 2/13/2033 | | | | | | | 0 | 39,703 | 289.44 | 2/12/2034 | | | 26,466 | 7,672,229 | | Joseph Erlinger | 31,513 | 0 | 157.79 | 2/19/2028 | | | | | | | 33,204 | 0 | 174.15 | 2/13/2029 | | | | | | | 38,266 | 0 | 216.15 | 2/18/2030 | | | | | | | 54,594 | 18,198 | 215.03 | 2/16/2031 | | | | | | | 20,774 | 20,774 | 253.39 | 2/14/2032 | | | | | | | 8,627 | 25,872 | 266.20 | 2/13/2033 | | | | | | | 0 | 31,345 | 289.44 | 2/12/2034 | | | 25,153 | 7,291,603 | | Gillian McDonald | 9,777 | 29,322 | 266.20 | 2/13/2033 | | | | | | | 0 | 31,345 | 289.44 | 2/12/2034 | 3,935 | 1,140,717 | 14,353 | 4,160,791 | | Desiree Ralls-Morrison | 12,669 | 4,223 | 231.68 | 5/17/2031 | | | | | | | 14,247 | 14,244 | 253.39 | 2/14/2032 | | | | | | | 5,980 | 17,940 | 266.20 | 2/13/2033 | | | | | | | 0 | 21,732 | 289.44 | 2/12/2034 | | | 17,351 | 5,029,881 |
Outstanding Equity Awards at 2024 Year-End
| (1) Options vest 25% on each of the first four anniversaries of the grant date and expire on the tenth anniversary of the grant date. For details regarding customary equity treatment upon termination, see the section on Potential Payments Upon Termination of Employment or Change in Control beginning on page 70. |
Outstanding Equity Awards at 2024 Year-End
| (2) PRSUs are typically granted to our NEOs subject to performance-based vesting conditions, but from time to time, we grant time-based RSUs. In connection with her hiring Ms. McDonald was granted time-based RSUs, as well as PRSUs and options with terms consistent with the Company’s annual long-term incentive awards. Ms. McDonald’s RSUs vested in two equal installments on each of February 13, 2024 and 2025. See footnotes 2, 6 and 7 of the 2024 Summary Compensation Table beginning on page 66. |
Outstanding Equity Awards at 2024 Year-End
| (3) Calculated by multiplying the number of shares covered by the award by $289.89, the closing price of Company stock on the NYSE on December 31, 2024. |
Outstanding Equity Awards at 2024 Year-End
| 68 | |
Outstanding Equity Awards at 2024 Year-End
| (4) The following table reflects the number of shares that vested on February 14, 2025, based on the 170.2 payout factor and the unvested PRSUs that are scheduled to be paid out in 2025 and 2026 if performance equals 100% of the targets. In the event of fractional shares, amounts are rounded up to the nearest whole share. |
Outstanding Equity Awards at 2024 Year-End
| NAME | GRANT DATE | VESTING DATE | NUMBER OF PRSUs* | | Christopher Kempczinski | 2/14/2022 | 2/14/2025 | 38,601 | | | 2/13/2023 | 2/13/2026 | 24,633 | | | 2/12/2024 | 2/12/2027 | 25,186 | | Ian Borden | 2/14/2022 | 2/14/2025 | 10,909 | | | 2/13/2023 | 2/13/2026 | 7,580 | | | 2/12/2024 | 2/12/2027 | 7,977 | | Joseph Erlinger | 2/14/2022 | 2/14/2025 | 11,748 | | | 2/13/2023 | 2/13/2026 | 7,107 | | | 2/12/2024 | 2/12/2027 | 6,298 | | Gillian McDonald | 2/13/2023 | 2/13/2026 | 8,055 | | | 2/12/2024 | 2/12/2027 | 6,298 | | Desiree Ralls-Morrison | 2/14/2022 | 2/14/2025 | 8,057 | | | 2/13/2023 | 2/13/2026 | 4,927 | | | 2/12/2024 | 2/12/2027 | 4,367 |
Outstanding Equity Awards at 2024 Year-End
| * Number of unvested PRSUs that are scheduled to be paid out include dividend equivalents. |
Option Exercises and Stock Vested – Fiscal 2024
Option Exercises and Stock Vested – Fiscal 2024
Option Exercises and Stock Vested – Fiscal 2024
| | OPTION AWARDS | | STOCK AWARDS | | | | NUMBER OF SHARES | VALUE REALIZED | NUMBER OF SHARES | VALUE REALIZED | | | ACQUIRED ON EXERCISE | ON EXERCISE | ACQUIRED ON VESTING | ON VESTING | | NAME (a) | (#)(b) | ($)(c) | (#)(d) | ($)(e) | | Christopher Kempczinski | 9,291 | 1,792,141 | 64,634 | 18,874,421 | | Ian Borden | 7,264 | 1,473,736 | 19,623 | 5,730,308 | | Joseph Erlinger | 0 | 0 | 20,775 | 6,066,716 | | Gillian McDonald | 0 | 0 | 3,842 | 1,103,077 | | Desiree Ralls-Morrison | 0 | 0 | 12,239 | 3,333,659 |
Non-Qualified Deferred Compensation – Fiscal 2024
Non-Qualified Deferred Compensation – Fiscal 2024
Non-Qualified Deferred Compensation – Fiscal 2024
| | EXECUTIVE | REGISTRANT | AGGREGATE | AGGREGATE | AGGREGATE | | | CONTRIBUTIONS | CONTRIBUTIONS | EARNINGS IN | WITHDRAWALS / | BALANCE AT | | NAME | IN LAST FY | IN LAST FY | LAST FY | DISTRIBUTIONS | LAST FYE | | (a) | ($)(b)(1) | ($)(c)(2) | ($)(d) | ($)(e) | ($)(f)(3) | | Christopher Kempczinski | 333,407 | 320,306 | 1,276,320 | 0 | 8,409,019 | | Ian Borden | 151,891 | 134,379 | 56,478 | 0 | 491,254 | | Joseph Erlinger | 250,766 | 132,913 | 689,721 | 0 | 6,560,354 | | Gillian McDonald | 0 | 0 | 0 | 0 | 0 | | Desiree Ralls-Morrison | 476,642 | 102,433 | 243,274 | 0 | 1,565,084 |
Non-Qualified Deferred Compensation – Fiscal 2024
| (1) Represents salary deferrals which are also reported as compensation for 2024 in the 2023 Summary Compensation Table on page 66. |
Non-Qualified Deferred Compensation – Fiscal 2024
| (2) Includes the following aggregate amounts reported in the Summary Compensation Table in prior years: |
Non-Qualified Deferred Compensation – Fiscal 2024
| Christopher Kempczinski | $4,475,540 | | Ian Borden | $138,006 | | Joseph Erlinger | $3,357,620 | | Gillian McDonald | $0 | | Desiree Ralls-Morrison | $196,389 |
Non-Qualified Deferred Compensation – Fiscal 2024
| 2025 Proxy Statement | 69 |
Potential Payments Upon Termination of Employment or Change in Control
Potential Payments Upon Termination of Employment or Change in Control In the event of a termination or change in control followed by termination of employment, our NEOs would receive certain payments and benefits, as described below.
Potential Payments Upon Termination of Employment or Change in Control
| 70 | |
2024 Pay Ratio
2024 Pay Ratio We have approximately 150,000 employees, which include those in our corporate and other offices as well as in Company-owned and operated restaurants, of which approximately 70% are based outside of the U.S. Most of these employees work in flexible, part-time roles, which is reflected in the compensation levels of our employees. In order to attract and retain talent, we provide competitive compensation commensurate with an employee’s position and geographic location, while also aligning compensation to Company and individual performance. We are committed to a strong pay-for-performance culture that closely aligns the interests of our executives with those of our shareholders. We aim to have approximately 90% of our CEO’s total target direct compensation opportunity be subject to performance against our robust and objective performance targets. For 2024, our CEO’s total compensation was $18,195,263, resulting in a ratio of 1,014:1.
2024 Pay Ratio
| 2025 Proxy Statement | 73 |
2024 Pay vs. Performance
2024 Pay vs. Performance
2024 Pay vs. Performance
| | PAY VS. PERFORMANCE | | | | | | | | | | | | | | VALUE OF INITIAL | | | | | | | | | | FIXED $100 | | | | | | | | | | INVESTMENT BASED ON:(5) | | | | | | | | AVERAGE | | | | | | | | | | SUMMARY | AVERAGE | | PEER | | | | | SUMMARY | | COMPENSATION | COMPENSATION | | GROUP | | | | | COMPENSATION | COMPENSATION | TABLE | ACTUALLY | TOTAL | TOTAL | | ANNUAL | | | TABLE | ACTUALLY | TOTAL FOR | PAID TO | SHAREHOLDER | SHAREHOLDER | NET | EPS | | | TOTAL FOR PEO | PAID TO PEO | NON-PEO NEOs | NON-PEO NEOs | RETURNS | RETURN | INCOME | GROWTH | | YEAR(1) | ($)(2) | ($)(3) | ($)(2) | ($)(4) | ($) | ($)(6) | ($) | (%)(7) | | 2024 | 18,195,263 | 12,729,663 | 5,325,460 | 4,007,667 | 165 | 165 | 8,223 | (2.0) | | 2023 | 19,155,001 | 36,852,582 | 7,265,484 | 10,460,553 | 164 | 144 | 8,469 | 18.0 | | 2022 | 17,770,514 | 29,572,322 | 6,075,626 | 9,195,551 | 143 | 124 | 6,177 | 15.0 | | 2021 | 20,028,132 | 40,175,283 | 8,029,832 | 14,542,270 | 142 | 133 | 7,545 | 50.0 | | 2020 | 10,847,032 | 9,784,035 | 5,126,870 | 5,041,528 | 111 | 110 | 4,731 | (23.0) |
2024 Pay vs. Performance
| (1) Mr. Kempczinski served as our principal executive officer (“PEO”) for the entirety of 2020, 2021, 2022, 2023 and 2024. Our other named executive officers (“NEOs”) for the applicable years were as follows: |
2024 Pay vs. Performance
| o | 2024: Messrs. Borden, Erlinger and Mmes. McDonald and Ralls-Morrison; |
2024 Pay vs. Performance
| o | 2023: Messrs. Borden and Erlinger and Ms. McDonald and Jonathan Banner; |
2024 Pay vs. Performance
| o | 2022: Messrs. Borden, Erlinger, Ozan, Ms. Ralls-Morrison, and Brian Rice; |
2024 Pay vs. Performance
| o | 2021: Messrs. Borden, Erlinger and Ozan and Ms. Ralls-Morrison; and |
2024 Pay vs. Performance
| o | 2020: Messrs. Borden and Erlinger and Heidi Capozzi, Jerome Krulewitch and Kevin Ozan. |
2024 Pay vs. Performance
| (2) Amounts reported in this column represent (i) the total compensation reported in the Summary Compensation Table (“SCT”) for the applicable year in the case of Mr. Kempczinski and (ii) the average of the total compensation reported in the SCT for the applicable year for our NEOs reported for the applicable year, other than the PEO for each such years. |
2024 Pay vs. Performance
| (3) Amounts reported in this column represent the compensation actually paid to Mr. Kempczinski as our PEO in the indicated fiscal years, based on his total compensation reported in the SCT for the indicated fiscal years and adjusted as shown in the table below. The amounts reflected for fiscal years 2020-2023 have been revised from the amounts previously reported in last year’s proxy statement in order to incorporate an administrative correction in the calculation of the fair value for stock and option awards. |
2024 Pay vs. Performance
| | PEO | | | | | | | 2024 | 2023 | 2022 | 2021 | 2020 | | Summary Compensation Table - Total Compensation(a) | $18,195,263 | $19,155,001 | $17,770,514 | $20,028,132 | $10,847,032 | | - Grant Date Fair Value of Stock Awards and Option Awards Granted in Fiscal Year(b) | $15,000,198 | $13,000,224 | $11,500,239 | $14,000,181 | $9,500,140 | | + Fair Value at Fiscal Year-End of Outstanding and Unvested Stock Awards and Option Awards Granted in Fiscal Year(c) | $15,022,059 | $16,287,558 | $14,642,639 | $24,274,810 | $9,684,864 | | + Change in Fair Value of Outstanding and Unvested Stock Awards and Option Awards Granted in Prior Fiscal Years(d) | $(4,228,377) | $14,148,428 | $10,047,473 | $9,987,616 | $(1,555,046) | | + Fair Value at Vesting of Stock Awards and Option Awards Granted in Fiscal Year That Vested During Fiscal Year(e) | $0 | $0 | $0 | $0 | $0 | | + Change in Fair Value as of Vesting Date of Stock Awards and Option Awards Granted in Prior Fiscal Years For Which Applicable Vesting Conditions Were Satisfied During Fiscal Year(f) | $(1,259,084) | $261,819 | $(1,388,065) | $(115,094) | $307,325 | | = Compensation Actually Paid | $12,729,663 | $36,852,582 | $29,572,322 | $40,175,283 | $9,784,035 |
2024 Pay vs. Performance
| (4) Amounts reported in this column represent the compensation actually paid to our NEOs other than Mr. Kempczinski in the indicated fiscal year, based on the average total compensation for such NEOs reported in the SCT for the indicated fiscal year and adjusted as shown in the table below. The amounts reflected for fiscal years 2020-2023 have been revised from the amounts |
2024 Pay vs. Performance
| 74 | |
2024 Pay vs. Performance
previously reported in last year’s proxy statement in order to incorporate an administrative correction in the calculation of the fair value for stock and option awards. See footnote 1 for our NEOs included in the average for each indicated fiscal year.
2024 Pay vs. Performance
| | Other NEOs Average(1) | | | | | | | 2024 | 2023 | 2022 | 2021 | 2020 | | Summary Compensation Table - Total Compensation(a) | $5,325,460 | $7,265,484 | $6,075,626 | $8,029,832 | $5,126,870 | | - Grant Date Fair Value of Stock Awards and Option Awards Granted in Fiscal Year(b) | $3,712,793 | $4,937,876 | $3,440,186 | $5,125,135 | $3,630,184 | | + Fair Value at Fiscal Year-End of Outstanding and Unvested Stock Awards and Option Awards Granted in Fiscal Year(c) | $3,718,194 | $5,997,952 | $4,304,023 | $8,313,597 | $3,818,854 | | + Change in Fair Value of Outstanding and Unvested Stock Awards and Option Awards Granted in Prior Fiscal Years(d) | $(980,981) | $2,105,782 | $2,663,320 | $3,379,164 | $(860,947) | | + Fair Value at Vesting of Stock Awards and Option Awards Granted in Fiscal Year That Vested During Fiscal Year(e) | $0 | $0 | $0 | $0 | $199,881 | | + Change in Fair Value as of Vesting Date of Stock Awards and Option Awards Granted in Prior Fiscal Years For Which Applicable Vesting Conditions Were Satisfied During Fiscal Year(f) | $(342,213) | $29,211 | $(407,232) | $(55,189) | $387,054 | | = Compensation Actually Paid | $4,007,667 | $10,460,553 | $9,195,551 | $14,542,270 | $5,041,528 |
2024 Pay vs. Performance
The below footnotes apply to the tables included in each of footnotes 3 and 4.
2024 Pay vs. Performance
| (a) Represents Total Compensation as reported in the SCT for the indicated fiscal year. |
2024 Pay vs. Performance
| (b) Represents the aggregate grant date fair value as of the indicated fiscal year of the stock awards and option awards granted to each of Mr. Kempczinski and the respective NEOs as applicable for each year, during such fiscal year, calculated using the same methodology used for financial statement reporting purposes. |
2024 Pay vs. Performance
| (c) Represents the aggregate fair value as of the indicated fiscal year-end for each of Mr. Kempczinski’s, and the respective NEOs’ as applicable for each year, outstanding and unvested stock awards and option awards granted during such fiscal year, calculated using the same methodology used for financial statement reporting purposes and, for awards subject to performance-based vesting conditions, based on the probable outcome of such performance-based vesting conditions as of the last day of the fiscal year. |
2024 Pay vs. Performance
| (d) Represents the aggregate change in fair value during the indicated fiscal year of the outstanding and unvested stock awards and option awards held by each of Mr. Kempczinski and the respective NEOs as applicable for each year, as of the last day of the indicated fiscal year, calculated using the same methodology used for financial statement reporting purposes and, for awards subject to performance-based vesting conditions, based on the probable outcome of such performance-based vesting conditions as of the last day of the fiscal year. |
2024 Pay vs. Performance
| (e) Represents the aggregate fair value at vesting of the stock awards and option awards that were granted to each of Mr. Kempczinski and the respective NEOs as applicable for each year, and vested during the indicated fiscal year, calculated using the same methodology used for financial statement reporting purposes. |
2024 Pay vs. Performance
| (f) Represents the aggregate change in fair value, measured from the prior fiscal year-end to the vesting date, of each stock award and option award held by each of Mr. Kempczinski and the respective NEOs as applicable for each year, that was granted in a prior fiscal year and which vested during the indicated fiscal year, calculated using the same methodology used for financial statement reporting purposes. |
2024 Pay vs. Performance
| (5) The information provided reflects the respective values at the end of each year of a $100 investment on December 31, 2019, including the reinvestment of any dividends, for each of our common stock and our peer group (see footnote 6 for further information on our peer group). Historic stock price performance is not necessarily indicative of future stock price performance. |
2024 Pay vs. Performance
| (6) The TSR Peer Group consists of the component companies of the Dow Jones Industrial Average, the peer group used by us for purposes of the stock performance graph in our Annual Report on Form 10-K. |
2024 Pay vs. Performance
| (7) Represents annual EPS growth. As noted in the CD&A, for 2024, the Committee determined that EPS growth continues to be viewed as a core driver of our performance and stockholder value creation. Accordingly, EPS is utilized as the most heavily weighted performance metric applicable to our PRSU award design. EPS growth is calculated as the percentage change in our EPS from the prior fiscal year, with EPS calculated as earnings per share, adjusted consistent with pre-established guidelines as described on pages 62 and 63 of the CD&A. |
2024 Pay vs. Performance
| 2025 Proxy Statement | 75 |