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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No.     )
Filed by the Registrant  ☒                             Filed by a Party other than the Registrant  :=¨
Check the appropriate box:
 
  Preliminary Proxy Statement
   
 
Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
   
  Definitive Proxy Statement
   
  Definitive Additional Materials
   
  Soliciting Material under § 240.14a-12
 
MANPOWERGROUP INC.
(Name of registrant as specified in its charter)
 
(Name
of person(s) filing proxy statement, if other than the registrant)
Payment of Filing Fee (Check the appropriate box):
 
No fee required.
 
:=¨
Fee paid previously with preliminary materials.
 
:=¨
Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i) and 0-11
 
 
 


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Notice of Annual Meeting of Shareholders

 

 

LOGO       ManpowerGroup Inc.  |   100 Manpower Place  |  Milwaukee, Wisconsin 53212

2023 Annual Meeting Information

 

LOGO   LOGO   LOGO   LOGO

Date

 

Friday

May 5, 2023

 

Time

 

9:00 a.m. CDT

 

Virtual Meeting

 

This year’s meeting is a virtual shareholders meeting at www.meetnow.global/MYXC6R4

 

Record Date

 

The close of business

February 24, 2023

Voting Methods LOGO

Whether or not you plan to attend the meeting, it is important that your shares are represented and voted. If you are a shareholder of record (“registered shareholder”), we urge you to vote in advance of the meeting using one of the advance voting methods below. You can vote by any of the following methods:

 

By Internet:

Prior to the 2023 Annual Meeting, vote your shares online at
www.envisionreports.com/MAN

 

During the 2023 Annual Meeting, vote your shares online at www.meetnow.global/MYXC6R4

 

By Phone:

1-800-652-VOTE (8683)

within the USA, US

territories and Canada

 

By Mail:

Complete, sign and

return proxy card in the postage-paid

envelope provided

 

By QR Code:

Scan this QR code

24/7 to vote with

your mobile device

 

LOGO

If your shares are held in street name through a bank, broker or other holder of record (“beneficial holder”), you will receive instructions from the holder of record that you must follow in order for your shares to be voted. All shareholders will still be able to vote online during the meeting, even if they previously submitted their proxy.

Items of Business and Voting Recommendations

 

PROPOSAL

 

DESCRIPTION

  

BOARD VOTE

RECOMMENDATION

     PAGE REFERENCE
(FOR MORE DETAIL)

 

1

 

To elect twelve individuals nominated by the Board of Directors of ManpowerGroup to serve until 2024 as directors;

   FOR each of
the director nominees
     76

 

 

2

 

To ratify the appointment of Deloitte & Touche LLP as our independent auditors for 2023;

   FOR

 

     78

 

 

3

 

To hold an advisory vote on approval of the compensation of our named executive officers; and

   FOR

 

     79

 

 

4

 

To hold an advisory vote on the frequency of the advisory vote on the compensation of our named executive officers; and

   ONE YEAR

 

     81

 

 

5

 

To transact such other business as may properly come before the meeting

           

Holders of a majority of the outstanding shares must be present in person or by proxy in order for the annual meeting to be held. For purposes of our meeting, people who attend virtually will be considered in-person.

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Shareholders to be held on May 5, 2023: The annual report on Form 10-K and proxy statement of ManpowerGroup are available for review at www.envisionreports.com/MAN.

By Order of the Board of Directors

Richard Buchband, Secretary

March 9, 2023

 

 

 


Table of Contents

Table of Contents

 

 

        

 

Proxy
Summary

     
   2023 Proxy Statement Summary      i  
     
     
                     
      

1

  Board of
Directors
   Director Nominee Biographies      1  
  

 

Composition and Qualifications of Board Members

  

 

 

 

8

 

 

  

 

Board Diversity and Tenure

  

 

 

 

9

 

 

  

 

Director Compensation for 2022

  

 

 

 

11

 

 

  

 

Non-Employee Director Stock Ownership Guidelines

  

 

 

 

13

 

 

                     
      

2

  Governance & Sustainability    Board Leadership Structure      14  
  

 

Board Oversight

  

 

 

 

15

 

 

  

 

Independent Compensation Consultant

  

 

 

 

17

 

 

  

 

Board Independence and Related Party Transactions

  

 

 

 

19

 

 

  

 

Communicating With Our Board

  

 

 

 

19

 

 

  

 

Meetings and Committees of the Board

  

 

 

 

20

 

 

      

 

Board Effectiveness and Evaluation

  

 

 

 

23

 

 

                     
 

3

  Executive Compensation    Compensation Discussion and Analysis      24  
  

 

Report of the People, Culture and Compensation Committee of the Board of Directors

  

 

 

 

48

 

 

  

 

People, Culture and Compensation Committee Interlocks and Insider Participation

  

 

 

 

48

 

 

  

 

Compensation Tables

  

 

 

 

49

 

 

  

 

Summary Compensation Table

  

 

 

 

49

 

 

  

 

Grants of Plan-Based Awards in 2022

  

 

 

 

50

 

 

  

 

Compensation Agreements and Arrangements

  

 

 

 

51

 

 

  

 

Grants Under the 2011 Equity Incentive Plan

  

 

 

 

51

 

 

  

 

Outstanding Equity Awards at December 31, 2022

  

 

 

 

52

 

 

  

 

Option Exercises and Stock Vested in 2022

  

 

 

 

54

 

 

  

 

Nonqualified Deferred Compensation in 2022

  

 

 

 

55

 

 

  

 

Termination of Employment and Change of Control Arrangements

  

 

 

 

57

 

 

  

 

Post-Termination and Change of Control Benefits

  

 

 

 

60

 

 

  

 

Compensation Policies and Practices as They Relate to Risk Management

  

 

 

 

64

 

 

  

 

CEO Pay Ratio

  

 

 

 

65

 

 

  

 

Pay versus Performance

 

  

 

 

 

66

 

 

 

 

 


Table of Contents

2023

 

 

      

 

4

 

 

Audit

Committee

Matters

   Audit Committee Report      70  
  

 

Fees Billed by Deloitte & Touche

  

 

 

 

72

 

 

  

 

Independent Auditor Services Policy

  

 

 

 

72

 

 

     
                     
      

5

  Information
About Stock
Ownership
   Security Ownership of Certain Beneficial Owners      73  
  

 

Beneficial Ownership of Directors and Executive Officers

  

 

 

 

74

 

 

     
     
     
                     
 

6

  Proposals to
be Voted on
During the
Meeting
   1: Election of Directors      76  
  

 

2: Ratification of Independent Auditors

  

 

 

 

78

 

 

  

 

3: Advisory Vote on Approval of the Compensation of Named Executive Officers

 

  

 

 

 

79

 

 

   4: Advisory Vote on the Frequency of the Advisory Vote on the Compensation of Our Named Executive Officers   

 

 

 

81

 

 

     
     
                     
 

7

  Information
About the
Meeting
   Date, Time and Place of Meeting      82  
  

 

Proxy Materials are Available on the Internet

  

 

 

 

82

 

 

  

 

Participating in the Annual Meeting

  

 

 

 

82

 

 

  

 

Soliciting Proxies

  

 

 

 

83

 

 

  

 

Vote Required and Voting Standards

  

 

 

 

83

 

 

  

 

Corporate Governance Documents

  

 

 

 

85

 

 

  

 

Submission of Shareholder Proposals

  

 

 

 

86

 

 

  

 

Other Voting Information

  

 

 

 

86

 

 

  

 

Other Matters

  

 

 

 

86

 

 

     
     
     
     
     
     
     
         

 

 

 


Table of Contents

Proxy Statement Summary

 

 

 

This summary highlights information contained in the proxy statement, which is first being made available to shareholders on or about March 9, 2023. This summary does not contain all the information you should consider. We encourage you to read the entire proxy statement before voting. For information regarding ManpowerGroup’s 2022 performance, please read ManpowerGroup’s 2022 Annual Report on Form 10-K.

Board of Directors Nominees

The following table provides summary information about each of the 12 director nominees, and the committees they serve on. Each director is elected annually by a majority of votes cast. Muriel Pénicaud was appointed to the board of directors effective December 12, 2022.

 

    NAME   AGE   DIRECTOR SINCE   INDEPENDENT   COMMITTEES

 

LOGO

  Jean-Philippe Courtois   62   2020   LOGO  

•  Audit

LOGO   William Downe   70   2011   LOGO  

•  People, Culture and Compensation

LOGO   John F. Ferraro   67   2016   LOGO  

•  Audit

LOGO   William P. Gipson   65   2020   LOGO  

•  People, Culture and Compensation

LOGO   Patricia Hemingway Hall   70   2011   LOGO  

•  Audit

•  Governance and Sustainability (CHAIR)

LOGO   Julie M. Howard   60   2016   LOGO  

•  People, Culture and Compensation

•  Governance and Sustainability

LOGO   Ulice Payne, Jr.   67   2007   LOGO  

•  Audit

•  Governance and Sustainability

LOGO   Muriel Pénicaud   67   2022   LOGO  

•  People, Culture and Compensation(1)

LOGO  

Jonas Prising

Chief Executive Officer

  58   2014      

•  None

LOGO   Paul Read   56   2014   LOGO  

•  Audit (CHAIR)

LOGO   Elizabeth P. Sartain   68   2010   LOGO  

•  People, Culture and Compensation (CHAIR)

LOGO   Michael J. Van Handel   63   2017   LOGO  

•  Governance and Sustainability

 

(1)

Ms. Pénicaud’s committee appointment was effective in February 2023.

 

 

 

LOGO   i   2023 Proxy Statement


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2023 PROXY STATEMENT SUMMARY

 

 

 

Our Board Has a Diversity of Experiences and Backgrounds

Our Board believes that having a diverse mix of directors with a variety of skills, experience, and backgrounds is essential to meeting its oversight responsibility.

Core Skills & Experience Identified by our Directors

 

LOGO

 

LOGO

 

 

 

LOGO   ii   2023 Proxy Statement


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2023 PROXY STATEMENT SUMMARY

 

 

 

LOGO

 

 

 

LOGO   iii   2023 Proxy Statement


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2023 PROXY STATEMENT SUMMARY

 

 

 

LOGO

 

 

 

LOGO   iv   2023 Proxy Statement


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2023 PROXY STATEMENT SUMMARY

 

 

 

LOGO

 

 

 

LOGO   v   2023 Proxy Statement


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2023 PROXY STATEMENT SUMMARY

 

 

 

LOGO

 

 

 

LOGO   vi   2023 Proxy Statement


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2023 PROXY STATEMENT SUMMARY

 

 

 

Key Compensation Practices

The people, culture and compensation committee continually reviews the Company’s executive compensation program to maintain compensation practices that are in the best interests of our shareholders. Some of our key policies are summarized below:

 

             
     What We Do           
   
    LOGO   Tie executive pay to performance.    
   
           LOGO   Set challenging performance objectives that align with company performance.    
   
    LOGO   Balance short-term and long-term incentives.    
   
    LOGO   Include caps on the potential payouts under the PSU grants and our annual incentive program.    
   
    LOGO   Use double triggers in our severance agreements and our equity awards.    
   
    LOGO   Maintain significant stock ownership guidelines for our NEOs.    
   
    LOGO   Maintain a clawback policy for our cash incentive and equity awards.    
   
    LOGO   Retain an independent compensation consultant.    
   
    LOGO   Establish appropriate compensation peer groups which the Committee re-evaluates annually.    
   
    LOGO   Reach out to leading shareholders and their advisory firms to discuss our executive compensation.    
   
    What We Don’t Do    
   
    LOGO   No dependence on Total Shareholder Return (“TSR”) as a performance metric for our NEOs. In our experience, TSR captures fluctuations in stock price, rather than measuring the performance of our executive team in operating our business. Our stock price can be sensitive to perceived changes in the global business climate, with fluctuations in stock price that are often de-coupled from the fundamentals of our business.    
   
    LOGO   No tax gross up payments for any amounts considered excess parachute payments.    
   
    LOGO   No dividends or dividend equivalents prior to vesting.    
   
    LOGO   No repricing of stock options.    
   
    LOGO   No hedging or pledging of ManpowerGroup stock.    
   
    LOGO   No excessive perquisites to our NEOs or tax gross up payments.    
             

 

 

 

LOGO   vii   2023 Proxy Statement


Table of Contents

LOGO

 

 

 

Director Nominee Biographies

 

LOGO

 

Jean-Philippe Courtois

 

Joined the board 2020

Age 62

Committees: Audit

 

 

Career Highlights

•  Executive Vice President, National Transformation Partnerships, at Microsoft, a global technology provider, since July 2021

•  Executive Vice President, President Global Sales, Marketing and Operations at Microsoft from 2016 to July 2021

•  President, Microsoft International from 2005 to 2016

•  CEO, Microsoft EMEA from 2003 to 2005

•  Former Director of AstraZeneca plc (2008 to 2016)

 

Qualifications

•  Significant managerial, strategic and marketing expertise in international business

•  Extensive experience in the technology industry developed over his more than three decades career with Microsoft, including global enterprise sales

•  Global operational expertise and branding insight from multiple senior leadership roles

•  Brings an important perspective from his prior service as a director on another public company board

 

 

LOGO

 

William Downe

 

Lead Director 2017-2023

Joined the board 2011

Age 70

Committees: People, Culture and Compensation

 

 

 

Career Highlights

•  Non-Executive Chairman of Trans Mountain Corporation, an oil pipeline operator, since November 2018

•  Chief Executive Officer of BMO Financial Group (“BMO”), a highly diversified financial services provider based in North America, from 2007 to 2017

•  Chief Operating Officer of BMO from 2006 to 2007

•  Deputy Chair of BMO and Chief Executive Officer, BMO Nesbitt Burns and Head of Investment Banking Group from 2001 to 2006

•  Director of Loblaw Companies Limited (since 2018)

•  Former Director of BMO (2007 to 2017)

 

Qualifications

•  Deep knowledge of the financial services industry and investment community based on his long tenure at BMO

•  Benefits the board through the significant managerial, operational and global experience he gained during his career at BMO and serving on its Board

•  Extensive expertise in compliance and risk oversight leading a company in a regulated industry

•  Provides a unique perspective to the boardroom as a long-serving CEO and board member

 

 

 

LOGO   1   2023 Proxy Statement


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LOGO

 

 

DIRECTOR NOMINEE BIOGRAPHIES

 

LOGO

 

John F. Ferraro

 

Joined the board 2016

Age 67

Committees: Audit

 

Career Highlights

•  Global Chief Operating Officer of Ernst & Young (“EY”), a global professional services organization, from 2007 to 2015

•  Held several senior leadership positions at EY, including Global Vice Chair Audit

•  Served as a member of EY’s Global Executive board for more than 10 years

•  Executive Vice President, Strategy and Sales of Aquilon Energy Services, a software and services company for the energy industry, from February 2019 to July 2019

•  Director of Advance Auto Parts (since 2015)

•  Director of International Flavor and Fragrances, Inc. (since 2015)

 

Qualifications

•  Significant depth in both finance and global operations management through his experience at EY

•  Background includes many years as a manager and executive in the professional services industry

•  Experience in accounting, financial oversight, compliance and risk management

•  Brings an important perspective from his service as a director on other public company boards

 

 

LOGO

 

William P. Gipson

 

Joined the board 2020

Age 65

Committees: People, Culture and Compensation

 

 

Career Highlights

•  President, Enterprise Packaging Transformation of Procter & Gamble (“P&G”), a leading global provider of branded consumer packaged goods, from 2017 to June 2019

•  Senior Vice President, Research & Development for Asia at P&G from 2015 to 2017

•  Senior Vice President, Research & Development for the Global Hair Care/Color & Overall Beauty Sector at P&G from 2011 to 2015

•  Senior Vice President, Corporate Chief Diversity Officer for P&G from 2011- June 2019, simultaneously served

•  A director of Rockwell Automation, Inc. (since November 2020)

 

Qualifications

•  Significant international, managerial and operational experience from his tenure as President, Enterprise Packaging and Transformation of P&G

•  Experience with research and business development at a leading international company, including multiple international postings

•  Brings a unique perspective to the board from his tenure as Chief Diversity Officer for Procter & Gamble

 

 

 

LOGO   2   2023 Proxy Statement


Table of Contents

LOGO

 

 

DIRECTOR NOMINEE BIOGRAPHIES

 

LOGO

 

Patricia Hemingway Hall

 

Joined the board 2011

Age 70

Committees: Audit; Governance and Sustainability (Chair)

 

Career Highlights

•  President and Chief Executive Officer of Health Care Service Corporation (“HCSC”), a mutual health insurer, from 2008 to 2015

•  President and Chief Operating Officer of HCSC from 2007 to 2008

•  Executive Vice President of Internal Operations of HCSC from 2006 to 2007

•  Director of Cardinal Health (since 2013)

•  Former Director of Halliburton (2019-2022)

•  Former Director of Celgene Corporation (2018-2019)

 

Qualifications

•  Significant managerial, operational, sales, marketing and government relations experience as a result of the various senior positions she held during her tenure with HCSC, including as its Chief Executive Officer

•  Strong background in corporate governance and corporate administration

•  Brings an important perspective gained from her service as a director on other public company boards

 

 

 

LOGO

 

Julie M. Howard

 

Incoming Lead Director effective May 2023

Joined the board 2016

Age 60

Committees: People, Culture and Compensation; Governance and Sustainability

 

 

Career Highlights

•  Chief Executive Officer of Riveron Consulting, LLC (“Riveron”), a business advisory firm specializing in accounting, finance, technology, and operations, since March 2021

•  Chief Executive Officer of Navigant Consulting, Inc. (“Navigant”), a specialized global professional services firm, from 2012 to October 2019

•  Chairman of the Board of Navigant from 2014 to October 2019

•  Prior thereto, Ms. Howard held several leadership positions at Navigant including Chief Operating Officer

•  Director of Sleep Number Corporation (since May 2020)

•  Former Director of InnerWorkings, Inc. (2012-2019)

 

Qualifications

•  Deep knowledge in the global professional services industry

•  Significant managerial, transactional and operational experience

•  Experience with technology and innovation, including with private enterprises and public-sector clients

•  Brings an important perspective from her service as a director of other public company boards

 

 

 

LOGO   3   2023 Proxy Statement


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LOGO

 

 

DIRECTOR NOMINEE BIOGRAPHIES

 

LOGO

 

Ulice Payne, Jr.

 

Joined the board 2007

Age 67

Committees: Audit;
Governance and Sustainability

 

 

Career Highlights

•  President and Managing Member of Addison-Clifton, LLC, a provider of global trade compliance advisory services, since 2004

•  Chief Executive Officer of the Milwaukee Brewers Baseball Club from 2002 to 2003

•  Partner with the law firm Foley & Lardner LLP from 1998 to 2002

•  Director of WEC Energy Group, Inc. (formerly Wisconsin Energy Corporation) (since 2003)

•  Director of Foot Locker, Inc. (since 2016)

•  Former Trustee of The Northwestern Mutual Life Insurance Company (2005-2018)

 

Qualifications

•  Significant managerial, operational, financial and global experience as a result of many senior positions he has held including as President of Addison-Clifton, LLC

•  Deep understanding of global business trends and international business

•  Brings an important perspective from his service as a director of other public company boards

 

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Muriel Pénicaud

 

Joined the board 2022

Age 67

Committees: People, Culture, and Compensation

 

 

Career Highlights

•  Senior Advisor to Bain Capital, a private investment firm, since February 2023

•  Ambassador, Permanent Representative of France to the OECD, from 2020 to March 2022

•  Minister of Labor, Republic of France, from 2017 to July 2020

•  French Ambassador for International Investment and CEO of Business France, the national agency supporting the international development of the French economy, from 2014 to 2017

•  Senior Executive Vice-President, Human Resources at Danone Group and a member of its Executive Committee from 2008 to 2014.

•  Senior Executive Vice President, Human Resources, Organization and Sustainable Development at Dassault Systems from 2002 to 2008

 

Qualifications

•  Extensive and significant experience in government relations and human resources as a result of the senior positions she has held, including her tenure as the French Minister of Labor

•  Experience in international business and human capital management

 

 

 

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DIRECTOR NOMINEE BIOGRAPHIES

 

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Jonas Prising

 

Joined the board 2014

Age 58

Committees: None

 

Career Highlights

•  Chief Executive Officer of ManpowerGroup since 2014

•  Chairman of ManpowerGroup since 2015

•  ManpowerGroup President from 2012 to 2014

•  Executive Vice President, President of ManpowerGroup - The Americas from 2009 to 2012

•  Executive Vice President, President of ManpowerGroup - United States and Canadian Operations from 2006 to 2008

•  Prior thereto, held other positions with increasing responsibility at ManpowerGroup since 1999

•  Director of Kohl’s Corporation (since 2015)

 

Qualifications

•  Extensive and specific knowledge of ManpowerGroup and its operations, including playing a significant role in shaping the Company’s long-term business strategy

•  Brings a deep understanding of our industry and the competitive environment

•  Provides a global perspective and strong knowledge of the relevant marketplaces in Europe and Asia, as well as the Americas

 

 

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Paul Read

 

Joined the board 2014

Age 56

Committees: Audit (Chair)

 

 

Career Highlights

•  President and Chief Operating Officer of Ingram Micro, Inc., a technology distributor and supply-chain services provider, from 2013 to 2016

•  Chief Financial Officer of Flextronics International, Ltd., an electronics manufacturing services provider, from 2008 to 2013

 

Qualifications

•  Significant managerial, operational and global experience as a result of many senior positions he has held, including his tenure as President and Chief Operating Officer of Ingram Micro, Inc.

•  Extensive background in finance and accounting matters

•  Extensive information security and technology industry knowledge

 

 

 

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DIRECTOR NOMINEE BIOGRAPHIES

 

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Elizabeth P. Sartain

 

Joined the board 2010

Age 68

Committees: People, Culture and Compensation (Chair)

 

 

 

Career Highlights

•  Independent Human Resource Advisor and Consultant since 2008

•  Executive Vice President and Chief People Officer at Yahoo! Inc. from 2001 to 2008

•  An executive with Southwest Airlines serving in various positions from 1988 to 2001

•  Former Director of Shutterfly Inc. (2016 to 2019)

 

Qualifications

•  Experience in executive compensation, organizational design and human capital management

•  Significant human resources experience as a result of senior management positions she held at several prominent companies

•  Brings an important perspective gained from her service as a director on other public company boards

 

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Michael J. Van Handel

 

Joined the board 2017

Age 63

Committees: Governance and Sustainability

 

 

Career Highlights

•  Senior Executive Vice President of ManpowerGroup from 2016 to 2017

•  Chief Financial Officer of ManpowerGroup from 1998 to 2016

•  Several other senior finance and accounting positions within ManpowerGroup since 1989

•  Director of BMO Financial Corporation, a subsidiary of BMO Financial Group (since 2006)

•  Director of ICF International (since 2017)

 

Qualifications

•  Deep knowledge of ManpowerGroup developed over many years of experience at the Company, including nearly two decades as CFO

•  Significant managerial, operational, transactional and financial markets experience relevant to our business

•  Brings an important perspective gained from his service as a director on other public company boards

 

 

 

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DIRECTOR NOMINEE BIOGRAPHIES

 

Each director attended at least 75% of the board meetings and meetings of committees on which he or she served in 2022. The board of directors held five meetings during 2022. The board of directors did not take any action by written consent during 2022.

The board of directors has established a general retirement age of 75. Under the Company’s corporate governance guidelines, an individual cannot be nominated for election to the board of directors after his or her 75th birthday. Any director who turns 75 during his or her normal term will continue in office until the expiration of that term.

Under ManpowerGroup’s bylaws, nominations, other than those made by the board of directors or the governance and sustainability committee, must be made pursuant to timely notice in proper written form to the Secretary of ManpowerGroup. To be timely, a shareholder’s request to nominate a person for election to the board of directors at an annual meeting of shareholders, together with the written consent of such person to serve as a director, must be received by the Secretary of ManpowerGroup at the principal office of the Company not earlier than the close of business on the 150th day, nor later than the close of business on the 90th day, prior to the date of the annual meeting fixed pursuant to the bylaws. To be in proper written form, the notice must contain certain information concerning the nominee and the shareholder submitting the nomination, including the disclosure of any hedging, derivative or other complex transactions involving the Company’s common stock to which a shareholder proposing a director nomination is a party.

In addition to satisfying the foregoing requirements under our bylaws, to comply with the universal proxy rules, shareholders who intend to solicit proxies in support of director nominees other than the Company’s nominees must generally provide notice no later than 60 days prior to the anniversary of the previous year’s annual meeting date in accordance with Rule 14a-19 under the Securities Exchange Act of 1934.

 

 

 

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Composition and Qualifications of Board Members

Our Board is committed to regular renewal and refreshment and has continuously enhanced the director recruitment and selection process, resulting in a well-qualified and diverse group of director nominees. As part of that process, the governance and sustainability committee, which oversees succession planning for the Board and key leadership roles on the Board and its committees, regularly reviews the composition of our Board and assesses the skills and characteristics of our directors with a view towards enhancing the composition of our board to support the Company’s strategy.

In connection with its consideration of possible candidates for board membership, the governance and sustainability committee has identified areas of experience that members of the board should as a goal collectively possess. The below graphic lists these skills and attributes for each of the 12 nominees and shows which each nominee has identified as being part of his or her own experience.

 

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SKILLS, ATTRIBUTES & EXPERIENCE

                                                                       

Previous Board - Experience serving as a director of another public company

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International Business - Experience in diverse geographic, political and regulatory environments

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Corporate Governance - Supports our goals of strong Board and management accountability

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Active or Former CEO/Chairperson or other C-Suite Officer - Served in a senior leadership role at a large organization

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Sales - Experience developing strategies to grow sales and market share

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Government Relations - Understanding of government regulations affecting our business

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Human Resources - Experience building knowledge, skills and abilities of employees

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Marketing and Branding - Experience in a senior management position managing marketing/ branding

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Technology - Experience with technology, cybersecurity, information systems/data management or privacy

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Accounting or Financial Oversight - Experience to provide valuable insight in overseeing finances

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Operations - Experience with our business, strategy and marketplace dynamics

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BOARD DIVERSITY AND TENURE

 

The governance and sustainability committee has adopted, and the board of directors has approved, guidelines for selecting board candidates that the committee considers when evaluating candidates for nomination as directors including candidates recommended by shareholders. The guidelines call for the following with respect to the composition of the board:

 

  a variety of experience and backgrounds;

 

  possess professional and personal experience and expertise relevant to the Company’s business;

 

  individuals who will represent the best interests of the shareholders as a whole rather than special interest constituencies;
  the independence of at least a majority of the directors; and

 

  individuals who represent a diversity of gender, race, ethnicity and age.
 

 

Board Diversity and Tenure

Commitment to Board Diversity

The governance and sustainability committee and the board of directors believe that the qualifications, skills, experience and attributes set forth in this proxy statement for all individuals nominated for election satisfy the guidelines for selecting board candidates set out above and support the conclusion that these individuals are qualified to serve as directors of the Company and collectively possess a variety of skills, professional experience, and diversity of backgrounds allowing them to effectively oversee the Company’s business.

The composition of the nominees also reflects diversity of gender, race, ethnicity and age. The governance and sustainability committee and the board of directors believe that director diversity is consistent with the goal of creating a board that best serves the needs of the Company and the interests of its shareholders. While the board of directors does not have a formal policy with respect to diversity in the initial pool of director candidates, as part of the search process for a new director, the governance and sustainability committee actively seeks out women and minorities to include in the pool from which Board nominees are chosen and instructs any search firm engaged for the search to do so.

Director Tenure and Board Refreshment

In addition, we believe that diversity with respect to tenure is important in order to balance deep experience and knowledge of our Company with fresh perspectives. Our directors with longer service are highly valued for their experience and Company-specific knowledge. They have an extensive understanding of our business, provide historical context as the board reviews and evaluates the Company’s strategy and enhance board dynamics. At the same time, we recognize that, with the evolution of the marketplace and changes in our business, our board benefits from the identification of new directors who can bring important skills and fresh perspectives to the board. Since 2020, we have added three new directors to the board. As a result, we have four directors with ten years of service or more; four with six to nine years of service; and four with five or fewer years of service. We believe this is consistent with the board’s goal to maintain an appropriate balance of tenures.

 

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TENURE AND INDEPENDENCE

                                                                       

Years

    2       12       7       2       12       6       15       0.2       9       8       13       5  

Independent

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DEMOGRAPHICS

                                                                       

Gender Identity

    M       M       M       M       F       F       M       F       M       M       F       M  

Asian

                                                                                               

Black/African American

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Hispanic/Latinx

                                                                                               

White

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Born Outside U.S.

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BOARD DIVERSITY AND TENURE

 

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Director Compensation for 2022

The governance and sustainability committee reviews and makes recommendations to the full board with respect to the compensation of our non-employee directors annually. The full board of directors reviews these recommendations and makes a final determination on the compensation of our directors. From time to time, the governance and sustainability committee will engage with an outside compensation consultant to benchmark the Company’s non-employee director compensation against that of relevant peer companies and the general market. The governance and sustainability committee engaged with Mercer in 2021 to review our non-employee director compensation program.

For 2022, the board of directors approved the compensation arrangement for non-employee directors described below.

 

2022 NON-EMPLOYEE DIRECTOR COMPENSATION STRUCTURE

    

Annual Base Retainer (TOTAL)

   $290,000

Cash

   $115,000

Equity

   $175,000

Annual Governance and Sustainability Committee Chair Retainer

   $  20,000

Annual People, Culture and Compensation Committee Chair Retainer

   $  20,000

Annual Audit Committee Chair Retainer

   $  27,500

Annual Retainer for lead director

   $  35,000

Annual Retainer for lead director in the case where he or she also serves as a committee chair

   $  40,000

Annual Cash Retainer

Each year, directors receive an annual cash retainer but can elect to receive deferred stock in lieu of 50%, 75% or 100% of their annual cash retainer. This deferred stock will be granted at the end of the year for which the election was made. The number of shares granted will equal the annual cash retainer divided by the average of the closing prices of ManpowerGroup common stock on the last trading day of each full or partial calendar quarter covered by the election period. For 2022, Mr. Downe, Mr. Gipson and Ms. Howard elected to accept deferred stock in lieu of 100% of their annual cash retainer.

Annual Equity Grant

Each year directors also receive an annual grant of deferred stock. The annual grant is effective on January 1 of each year and the number of shares granted will equal the annual equity retainer divided by the closing sale price of a share of ManpowerGroup’s common stock on the last business day of the preceding year. Alternatively, the directors can elect to receive restricted stock instead of deferred stock if they make the election on or before December 31 of the preceding year. For 2022, the total shares of deferred stock or restricted stock granted to each director was 1,798 shares. The shares vest in equal quarterly installments on the last day of each calendar quarter during the year.

A new director will receive a grant of deferred stock effective the date the director is appointed to the board and will be prorated for the year. They can elect to receive restricted stock instead if they make the election within 10 days of appointment to the board of directors.

Distribution of Deferred Stock

Deferred stock will be distributed in ManpowerGroup shares on the earlier of 3 years from the date of grant or within 30 days of the director leaving the board. However, the director can extend the deferral period for these grants by at least five years, and thereafter extend further by at least five more years, as long as the election to extend is made at least twelve months before the end of the current deferral period. If a director extends the deferral period but leaves the board prior to the extended date, the deferred stock will be distributed within 30 days of the director leaving the board.

 

 

 

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DIRECTOR COMPENSATION FOR 2022

 

Director Compensation for 2022

 

NAME

  

FEES EARNED OR
PAID IN CASH

($)

      

STOCK AWARDS

($)(3)

       TOTAL ($)  

Gina R. Boswell(1)

     115,000          175,000          290,000  

Jean-Philippe Courtois

     115,000          185,502          300,502  

William Downe

              404,480          404,480  

John F. Ferraro

     115,000          221,940          336,940  

William P. Gipson

              303,446          303,446  

Patricia Hemingway Hall

     135,000          192,503          327,503  

Julie M. Howard

              324,768          324,768  

Ulice Payne, Jr.

     115,000          194,254          309,254  

Muriel Pénicaud(2)

     6,301          9,589          15,890  

Paul Read

     142,500          189,400          331,900  

Elizabeth P. Sartain

     135,000          175,000          310,000  

Michael J. Van Handel

     115,000          190,435          305,435  

 

(1)

Ms. Boswell resigned from the board of directors effective December 31, 2022.

 

(2)

Ms. Pénicaud was elected to the Board effective December 12, 2022 and received a pro-rata annual retainer and grant of deferred stock.

 

(3)

Reflects deferred stock and restricted stock granted under our 2011 Equity Incentive Plan and the Terms and Conditions Regarding the Grant of Awards to Non-Employee Directors under the 2011 Equity Incentive Plan. These amounts reflect the grant date fair value of the awards as computed in accordance with FASB ASC Topic 718. The amount reflected in the table was made up of:

 

  

For Ms. Boswell, $175,000 attributable to the annual grant of restricted stock (1,798 shares) in 2022.

 

  

For Mr. Courtois, $175,000 attributable to the annual grant of deferred stock (1,798 shares) and $10,502 attributable to deferred stock issued in lieu of dividends (132 shares) in 2022.

 

  

For Mr. Downe, $175,000 attributable to the annual grant of restricted stock (1,798 shares), $150,000 attributable to deferred stock granted in lieu of 100% of his annual retainers (1,885 shares) and $79,480 attributable to deferred stock issued in lieu of dividends (999 shares) in 2022.

 

  

For Mr. Ferraro, $175,000 attributable to the annual grant of deferred stock (1,798 shares) and $46,940 attributable to deferred stock issued in lieu of dividends (590 shares) in 2022.

 

  

For Mr. Gipson, $175,000 attributable to the annual grant of deferred stock (1,798 shares), $115,000 attributable to deferred stock granted in lieu of 100% of his annual retainer (1,445 shares) and $13,446 attributable to deferred stock issued in lieu of dividends (169 shares) in 2022.

 

  

For Ms. Hemingway Hall, $175,000 attributable to the annual grant of deferred stock (1,798 shares) and $17,503 attributable to deferred stock issued in lieu of dividends (220 shares) in 2022.

 

  

For Ms. Howard, $175,000 attributable to the annual grant of deferred stock (1,798 shares), $115,000 attributable to deferred stock granted in lieu of 100% of her annual retainer (1,445 shares) and $34,768 attributable to deferred stock issued in lieu of dividends (437 shares) in 2022.

 

  

For Mr. Payne, $175,000 attributable to the annual grant of deferred stock (1,798 shares) and $19,254 attributable to deferred stock issued in lieu of dividends (242 shares) in 2022.

 

  

For Ms. Pénicaud, $9,589 attributable to the prorated annual grant of deferred stock (112 shares) in 2022.

 

  

For Mr. Read, $175,000 attributable to the annual grant of restricted stock (1,798 shares) and $14,400 attributable to deferred stock issued in lieu of dividends (181 shares) in 2022.

 

  

For Ms. Sartain, $175,000 attributable to the annual grant of restricted stock (1,798 shares) in 2022.

 

  

For Mr. Van Handel, $175,000 attributable to the annual grant of deferred stock (1,798 shares) and $15,435 attributable to deferred stock issued in lieu of dividends (194 shares) in 2022.

 

  

The aggregate number of shares of deferred stock held by each of the non-employee directors can be found in Footnote 1 of the Beneficial Ownership of Directors and Executive Officers table on page 74. All such shares of deferred stock were fully vested as of December 31, 2022. All shares of restricted stock granted to the non-employee directors in 2022 were fully vested as of December 31, 2022.

 

 

 

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Non-Employee Director Stock Ownership Guidelines

The governance and sustainability committee believes that non-employee directors should hold a meaningful stake in ManpowerGroup to align their economic interests with those of the shareholders. To that end, the board of directors has adopted stock ownership guidelines for non-employee directors and reviews them on an annual basis. For all directors appointed prior to November 12, 2021, the total share ownership guideline is equal in value to $450,000. In 2021, the board of directors reviewed the stock ownership guidelines and determined to adjust the guidelines to further align with best practice. Under the new stock ownership guidelines, for any non-employee director appointed after November 12, 2021, the share ownership guideline is five times the annual cash retainer in effect when the director joins the board of directors. The committee considers vested deferred stock and common stock in determining targeted ownership levels. The following table details each non-employee director’s stock ownership relative to the stock ownership guidelines:

 

DIRECTOR

  

TARGET
NUMBER OF SHARES

(#)(1)

     NUMBER OF SHARES
HELD(#)(2)
     VALUE OF SHARES
($)(3)
     TARGET DATE TO
SATISFY GUIDELINES(4)

Jean-Philippe Courtois

     4,990        4,015        337,902      December 14, 2024

William Downe

     6,601        60,272        5,072,492       

John F. Ferraro

     5,894        17,871        1,504,023       

William P. Gipson

     4,990        6,583        554,025       

Patricia Hemingway Hall

     6,601        18,806        1,582,713       

Julie M. Howard

     5,064        18,769        1,579,599       

Ulice Payne, Jr.

     6,601        15,086        1,269,638       

Muriel Pénicaud

     6,674        112        9,426      December 12, 2027

Paul Read

     6,601        17,400        1,464,384       

Elizabeth P. Sartain

     6,601        28,072        2,362,540       

Michael J. Van Handel

     3,568        18,277        1,538,192       

 

(1)

Target shares are based on target value divided by the closing stock price on December 31, 2014 of $68.17 for non-employee directors in office as of January 1, 2015. For non-employee directors appointed between January 1, 2015 and November 12, 2021 target shares are based on target value ($450,000) divided by the closing price of the Company’s common stock on the last business day of the month during which the director was first appointed to the Board of Directors. For non-employee directors appointed after November 12, 2021 the share ownership guideline is five times the annual cash retainer in effect when the director joined the board of directors divided by the closing price of the Company’s common stock on the day the director joined.

 

(2)

Represents the number of shares held as of the record date, February 24, 2023 as follows:

 

  

For Mr. Courtois, 4,015 shares of vested deferred stock.

 

  

For Mr. Downe, 28,103 shares of common stock and 32,169 shares of vested deferred stock.

 

  

For Mr. Ferraro, 17,871 shares of vested deferred stock.

 

  

For Mr. Gipson, 6,583 shares of vested deferred stock.

 

  

For Ms. Hemingway Hall, 12,130 shares of common stock and 6,676 shares of vested deferred stock.

 

  

For Ms. Howard, 4,085 shares of common stock and 14,684 shares of vested deferred stock.

 

  

For Mr. Payne, 9,720 shares of common stock and 5,366 shares of vested deferred stock.

 

  

For Ms. Pénicaud, 112 shares of vested deferred stock.

 

  

For Mr. Read, 13,893 shares of common stock and 3,507 shares of vested deferred stock.

 

  

For Ms. Sartain, 28,072 shares of common stock.

 

  

For Mr. Van Handel, 14,363 shares of common stock and 3,914 shares of vested deferred stock.

 

(3)

Based on price per share of ManpowerGroup common stock on February 24, 2023 of $84.16.

 

(4)

Under the current policy, non-employee directors in office prior to November 21, 2021 have four years from the date of his or her appointment to attain targeted ownership levels. Any non-employee directors joining the board after November 12, 2021, including Ms. Pénicaud, will have five years from the date of his or her appointment to attain targeted ownership levels.

We Prohibit Non-Employee Directors from Hedging, Pledging and Short-selling Our Securities

Under ManpowerGroup’s Insider Trading Policy, non-employee directors are prohibited from engaging in short sales or hedging transactions involving ManpowerGroup securities, including forward sale or purchase contracts, equity swaps or exchange funds. Non-employee directors are also prohibited from engaging in puts, calls or other option or derivative instruments involving ManpowerGroup securities. Further, we do not allow non-employee directors to pledge ManpowerGroup securities at any time, which includes having ManpowerGroup stock in a margin account or using ManpowerGroup stock as collateral for a loan.

 

 

 

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Board Leadership Structure

 

 

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Chairman of the Board – Jonas Prising

 

Under ManpowerGroup’s bylaws and in accordance with the Company’s corporate governance guidelines, the board of directors can choose whether the roles of chairman and chief executive officer should be combined or separated, based on what it believes is best for the Company and its shareholders at a given point in time. Jonas Prising has been chairman of the board of directors since December 31, 2015. The board of directors has evaluated the Company’s leadership structure and determined that the presence of our independent lead director who, as described below, has meaningful oversight responsibilities, together with a strong leader in the combined role of chairman and chief executive officer, serves the best interests of ManpowerGroup and its shareholders. The board of directors believes that in light of Mr. Prising’s extensive knowledge of ManpowerGroup and its industry, gained through his tenure with the Company, he is well positioned to serve as both chairman and chief executive officer of the Company.

 

 

 

 

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Lead Director Until

May 5, 2023

 

 

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Lead Director Effective May 5, 2023

  

Lead Director Transition – Julie Howard to become Lead Director on May 5, 2023

 

Our corporate governance guidelines provide that if the same person holds the chief executive officer and chairman roles or if the chairman is not independent, the board of directors will designate one of the independent directors to serve as the lead director. The lead director helps ensure that there is an appropriate balance between management and the independent directors and that the independent directors are fully informed and able to discuss and debate the issues that they deem important.

 

Our corporate governance guidelines contemplate that the lead director will be appointed annually and that he or she should be willing to serve for at least three years in such capacity. The board of directors believes having a lead director serving consecutive terms provides greater continuity to the role, enhances board leadership and performance and facilitates effective oversight of the performance of senior management.

 

The board of directors has selected Julie Howard as the new lead director, effective May 5, 2023. Our incumbent lead director, William Downe, has served as lead director since May 2017, and will have completed six years in the role.

 

The independent directors believe that Ms. Howard is well suited to serve as the Company’s next lead director given her significant managerial, transactional and operational experience as CEO of Riveron Consulting, LLC and as the former CEO of Navigant Consulting, Inc., a publicly traded professional services firm. As a result of her broad-based and relevant background and her deep knowledge of the services industry, Ms. Howard is well positioned to serve as the next lead director to provide constructive, independent and informed guidance and oversight to management.

 

The lead director’s duties include the following:

 

•  Preside at executive sessions of the non-employee directors;

 

•  Preside at all other meetings of directors where the chairman of the board is not present;

 

•  Serve as liaison between the chairman of the board and the non-employee directors;

 

•  Approve what information is sent to the board;

 

•  Approve the meeting agendas for the board;

 

•  Approve meeting schedules to assure that there is sufficient time for discussion on all agenda items;

 

•  Provide feedback from executive sessions of the independent directors to the Chairman and CEO and other senior management;

 

•  Serve in a key role in the board evaluation processes and in evaluation of the CEO;

 

•  Recommend to the board and the board committees the retention of advisers and consultants who report directly to the board;

 

•  Have the authority to call meetings of the non-employee directors;

 

•  If requested by major shareholders, ensure that he or she is available for consultation and direct communication; and

 

•  Perform such other duties as the board may delegate from time to time.

 

 

 

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Board Oversight

Our board of directors and its committees work closely with management to provide oversight, review, and counsel related to long-term strategy, opportunities and risks. In particular, the board oversees business affairs and integrity, works with management to determine our mission and long-term strategy, oversees enterprise risk management, performs the annual CEO evaluation, oversees CEO succession planning, and oversees internal control over financial reporting and external audit. The board looks to the expertise of its committees to provide strategic oversight in their areas of focus. Examples of oversight areas are provided below.

Strategy

Led by the CEO, the Company’s executive management drives our strategy and operations and works to develop and execute business strategy, foster our desired culture, establish accountability, and control risk. Management also aligns our structure, operations, people, policies, and compliance efforts to our mission and strategy. Overseeing management’s development and execution of the Company’s strategy is one of the board’s primary responsibilities. The board works closely with executive management to respond to a dynamically changing business environment. Executive management and other leaders from across the Company provide business and strategy updates to our board quarterly, and the board participates in an annual strategy meeting with management. At meetings throughout the year, the board also assesses the strategic alignment of the Company’s budget, capital plan and strategic acquisition process.

Enterprise Risk Management

The board of directors is responsible for overseeing the execution of management’s enterprise risk management program for the Company. The board fulfills this responsibility both directly and through its standing committees, each of which assists the board in overseeing a part of the Company’s overall risk management.

The committees of the board oversee specific areas of the Company’s risk management as described below:

Audit Committee

The audit committee is responsible for assisting the board of directors with its oversight of the performance of the Company’s risk management functions including:

 

 

Reviewing and discussing with management the Company’s risk management framework, including policies, practices and procedures regarding risk assessment and management;

 

 

Receiving, reviewing and discussing with management reports on cybersecurity and data privacy risk;

 

 

Receiving, reviewing and discussing with management reports on other risk topics as the committee or management deems appropriate from time to time; and

 

 

Reporting to the board of directors on its activities in this oversight role.

People, Culture and Compensation Committee

The people, culture and compensation committee reviews and discusses with management the Company’s compensation policies and practices, and the assessment of certain risks, including whether any risks arising from the Company’s compensation policies and practices related to its people are reasonably likely to have a material adverse effect on the Company.

The people, culture and compensation committee also reviews and discusses with management the development, implementation and effectiveness of the Company’s policies and strategies relating to its human capital management function, including key policies and strategies regarding recruiting, retention, career development and progression, employee engagement, management succession, diversity and inclusion, employment practices and culture.

Governance and Sustainability Committee

The governance and sustainability committee evaluates the overall effectiveness of the board of directors, including its focus on the most critical issues and risks.

 

 

 

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BOARD OVERSIGHT

 

As part of this oversight, the committees engage in reviews and discussions with management (and others if considered appropriate) as necessary to be reasonably assured that the Company’s risk management processes (1) are adequate to identify the material risks that we face in a timely manner, (2) include strategies for the management of risk that are responsive to our risk profile and specific material risk exposure, (3) serve to integrate risk management considerations into business decision-making throughout the Company, and (4) include policies and procedures that are reasonably effective in facilitating the transmission of information with respect to material risks to the senior executives of the Company and each committee.

Environmental, Social and Governance (“ESG”) Matters

Corporate responsibility and sustainability are important priorities for the board of directors and the Company. We believe businesses have a responsibility to be a positive contributor to societal change. Our commitment to social responsibility extends to human capital, diversity and inclusion, human rights and fair employment, worker health and safety and climate change. We also see in these commitments additional ways of creating value for our shareholders that result in benefits to our employees, our customers and society. As part of our enterprise-wide approach to risk management and our strategies for long-term value creation, the board and management monitor long-term risks that may be impacted by environmental, social and governance issues. Additional information about ManpowerGroup’s corporate social responsibility efforts is located in the Proxy Summary under “Our Working to Change the World Plan” and available on our website at https://manpowergroup.com/sustainability.

As ESG matters continue to increase in significance, the board of directors has determined oversight of ESG matters should be consolidated with one of its standing committees and has delegated the oversight responsibility to the governance and sustainability committee. The governance and sustainability committee regularly meets with the chief sustainability and communications officer to review the effectiveness of management’s strategies, programs and policy implementation with respect to initiatives and programs related to sustainability, corporate culture, human capital management and climate change. In addition, each of the committees continues to address specific ESG matters related to its respective areas of oversight.

Cybersecurity and Data Privacy

As part of the board’s role in overseeing the Company’s enterprise risk management program, the board devotes time and attention to cybersecurity and data privacy related risks. The audit committee is responsible for overseeing information technology risk exposures, including cybersecurity, data privacy and data security. The audit committee regularly receives reports on cybersecurity and data privacy matters and related risk exposures from management, including our chief information security and chief privacy officer. The audit committee will regularly update the board of directors on such matters and the board will also periodically receive reports from management directly. All employees regularly participate in required and targeted information security and data privacy trainings. We also assess the efficacy of our information security program through internal detection and monitoring systems, as well as through the engagement of third-party experts.

Human Capital Management

Human capital management is at the core of our business and is how we create value for individuals, organizations and communities. Our purpose is to provide meaningful and sustainable employment and is rooted in our values: People, Knowledge and Innovation. Our board and its committees are actively engaged in overseeing the Company’s human capital management strategy. The people, culture and compensation committee is responsible for overseeing the Company’s policies and strategies related to human capital management matters, including recruiting, retention, career development and progression, employee engagement, management succession, diversity and inclusion, employment practices and culture. Management provides regular updates to the people, culture and compensation committee on these human capital management matters, and the board is kept apprised of any developments in these areas. In addition, the people, culture and compensation committee considers the impact of our executive compensation program and the incentives created by compensation awards on the Company’s overall risk profile. It also oversees management’s assessment of compensation risk arising from our compensation policies and practices.

 

 

 

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Independent Compensation Consultant

The people, culture and compensation committee has selected Mercer (US) Inc. (“Mercer”) to advise it on executive compensation matters. Mercer is engaged directly by the committee, and reports to the chair of the committee. Fees are set annually and are reflected in a one-year statement of work, which sets out the services to be performed by Mercer for the committee during the ensuing year. Mercer’s primary role is to provide objective analysis, advice and information and otherwise to support the committee in the performance of its duties. Mercer’s fees for executive compensation consulting to the committee in 2022 were $406,928.

The committee requests information and recommendations from Mercer as it deems appropriate in order to assist it in structuring and evaluating ManpowerGroup’s executive compensation programs and practices. The committee’s decisions about executive compensation, including the specific amounts paid to executive officers, are its own and may reflect factors and considerations other than the information and recommendations provided by Mercer.

Mercer’s engagement included the following services for the committee in 2022:

 

 

Review and recommend the companies used in our peer group;

 

 

Review guiding principles for executive compensation and recommend areas for modernization;

 

 

Evaluate the competitiveness of our total executive compensation and benefits program for the senior executives, including base salary, annual incentive, total cash compensation, long-term incentive awards, total direct compensation, perquisites, retirement benefits and total remuneration against the market;

 

 

Assess how well the compensation and benefits programs are aligned with the committee’s stated philosophy to align pay with performance, including analyzing our performance against comparator companies;

 

 

Provide advice and assistance to the committee on the levels of total compensation and the principal elements of compensation for our senior executives;

 

 

Advise the committee on salary, target incentive opportunities and equity grants as well as on the design and features of our short-term and long-term incentive programs for our senior executives;

 

 

Brief the committee on trends in executive compensation and benefits among large public companies and on regulatory, legislative and other developments; and

 

 

Assist in reviewing the Compensation Discussion and Analysis and other executive compensation disclosures to be included in this proxy statement.

The committee has reviewed whether the work provided by Mercer raises any conflict of interest. Factors considered by the committee include:

 

 

Other services provided to the Company by the consultant;

 

 

What percentage of the consultant’s total revenue is made up of fees from the Company;

 

 

Policies or procedures of the consultant that are designed to prevent a conflict of interest;

 

 

Any business or personal relationships between individual consultants involved in the engagement and committee members;

 

 

Any shares of the Company’s stock owned by individual consultants involved in the engagement; and

 

 

Any business or personal relationships between our executive officers and the consulting firm or the individual consultants involved in the engagement.

Based on its review, the committee does not believe that Mercer has a conflict of interest with respect to the work performed by the Company or the committee in 2022. The committee has also evaluated the independence of Mercer pursuant to the rules of the Securities and Exchange Commission and the New York Stock Exchange and no relationships were identified that would impact Mercer’s independence.

Ultimately, the consultant provides recommendations and advice to the committee in an executive session where management is not present, which is when critical pay decisions are made. This approach protects the committee’s ability to receive objective advice from the consultant so that the committee may make independent decisions about executive pay.

 

 

 

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INDEPENDENT COMPENSATION CONSULTANT

 

Besides Mercer’s involvement with the committee, it and its affiliates also provide other non-executive compensation services to us. These services are approved by management who oversee the specific areas of business for which the services are provided. The total amount paid for these other services provided in 2022 was $359,033. These services included actuarial and pension reporting services and insurance services. The majority of these services are provided not by Mercer itself, but by other companies owned by Marsh & McLennan, the parent company of Mercer, which therefore are considered affiliates even though they operate independently of Mercer.

The committee concluded that the services provided by the Marsh & McLennan affiliates (other than Mercer), did not raise any conflicts of interest.

The committee believes the advice it receives from the individual executive compensation consultants is objective and not influenced by Mercer’s or its affiliates’ other relationships with us because of the procedures Mercer and the committee have in place, including the following:

 

 

The consultants receive no incentive or other compensation based on the fees charged to us for other services provided by Mercer or any of its affiliates;

 

 

The consultants are not responsible for selling other Mercer or affiliate services to us;

 

 

Mercer’s professional standards prohibit an individual consultant from considering any other relationships Mercer or any of its affiliates may have with us in rendering his or her advice and recommendations; and

 

 

The committee evaluates the quality and objectivity of the services provided by the consultants each year and determines whether to continue to retain the consultants.

 

 

 

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Board Independence and Related Party Transactions

The board of directors has adopted categorical standards for relationships deemed not to impair independence of non-employee directors to assist it in making determinations of independence. The categorical standards are included in our Corporate Governance Guidelines and are available on ManpowerGroup’s website at https://investor.manpowergroup.com/governance. As required under the Corporate Governance Guidelines, our board of directors reviews and determines the independence of all directors on an annual basis.

In making its independence determinations, the governance and sustainability committee evaluates the various commercial and employment transactions and relationships known to the committee that exist between ManpowerGroup and the entities with which certain of our directors or members of their immediate families are, or have been, affiliated. The governance and sustainability committee also reviews any other relevant facts and circumstances regarding the nature of these relationships to determine whether other factors, regardless of the categorical standards, might compromise a director’s independence.

The board of directors has determined that eleven of the current directors of ManpowerGroup are independent under the listing standards of the New York Stock Exchange after taking into account the categorical standards. Certain of our directors serve as directors, and are officers or former officers, of companies that have engaged ManpowerGroup to provide services, all of which such relationships fall within the categorial standards. Mr. Prising does not qualify as independent under the listing rules of the New York Stock Exchange because he is currently an executive officer.

The governance and sustainability committee will evaluate eligible shareholder-nominated candidates for election to the board of directors in accordance with the procedures described in ManpowerGroup’s bylaws and in accordance with the guidelines and considerations relating to the selection of candidates for membership on the board of directors described under the heading “Composition and Qualifications of Board Members.”

ManpowerGroup does not have a policy regarding board members’ attendance at the annual meeting of shareholders. All of the directors attended the 2022 annual meeting of shareholders.

Communicating With Our Board

Any interested parties, including shareholders, may submit their communication to our Secretary, who will determine when communications and concerns will be forwarded to the Board, our independent directors as a group or our independent Lead Director. Communications received in writing are forwarded to the Board, committee, or to any individual director or directors to whom the communication is directed, unless the communication does not reasonably relate to the Company or its business, or is similarly inappropriate.

Such communications must be submitted to Richard Buchband, Secretary, ManpowerGroup Inc., 100 Manpower Place, Milwaukee, Wisconsin 53212.

Concerns about possible violations of our Code of Business Conduct and Ethics (the “Code”) should be reported as outlined in the Code, which is available on our website at https://investor.manpowergroup.com/governance.

 

 

 

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Meetings and Committees of the Board

The board of directors has standing audit, people, culture and compensation, and governance and sustainability committees. The board of directors has adopted written charters for these committees, which are available on ManpowerGroup’s web site at https://investor.manpowergroup.com/governance.

 

AUDIT COMMITTEE

   NUMBER OF MEETINGS IN 2022: 4   
 

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Paul Read

Chair

 

The board of directors has determined that each member of the audit committee meets the financial literacy and independence requirements of the SEC and New York Stock Exchange, as applicable, and that Mr. Ferraro and Mr. Read are each an “audit committee financial expert” as defined under the applicable rules of the SEC. Under the Company’s corporate governance guidelines, no member of the audit committee may serve on the audit committee of more than three public companies, including ManpowerGroup and no member of the audit committee currently does.

 

The functions of this committee are to:

 

•  appoint the independent auditors for the annual audit and approve the fee arrangements with the independent auditors;

 

•  monitor the independence, qualifications and performance of the independent auditors;

 

•  review the planned scope of the annual audit;

 

•  review the financial statements to be included in our quarterly reports on Form 10-Q and our annual report on Form 10-K, and our disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of those reports;

 

•  review our financial reporting processes and internal controls and any significant audit adjustments proposed by the independent auditors;

 

•  make a recommendation to the board of directors regarding inclusion of the audited financial statements in our annual report on Form 10-K;

 

•  review recommendations, if any, by the independent auditors resulting from the audit to ensure that appropriate actions are taken by management;

 

•  review and discuss with the independent auditors any critical audit matter (“CAM”) addressed in the audit and disclosures that relate to each CAM;

 

•  oversee compliance with our Independent Auditor Services Policy;

 

•  meet privately on a periodic basis with the independent auditors, internal audit staff and management to review the adequacy of our internal controls and other finance related matters;

 

•  meet privately with management to review the competence, performance and independence of the independent auditors;

 

•  monitor our internal audit department, including our internal audit plan;

 

•  review guidelines and policies regarding compliance by our employees with our code of business conduct and ethics, including the anti-corruption policy;

 

•  review procedures for receipt, retention and treatment of, and the confidential and anonymous submission of concerns regarding questionable accounting or auditing matters;

 

•  assist the board of directors with its oversight of the performance of the Company’s risk management function, including meeting periodically with the chief information officer and chief information security officer regarding the Company’s information technology and receiving periodic updates on the Company’s cybersecurity program;

 

•  review current tax matters affecting us;

 

•  periodically discuss with management our risk management framework;

 

•  periodically discuss with the Company’s general counsel and chief compliance officer any significant legal, compliance or regulatory matters that may have a material impact on the Company’s business, financial statements or compliance policies;

 

•  monitor any litigation involving ManpowerGroup that may have a material financial impact on ManpowerGroup or that relates to matters entrusted to the audit committee; and

 

 

•  approve the retention, compensation and termination of outside legal, accounting and other such advisors to the committee.

 

 

Members:

Jean-Philippe Courtois

John F. Ferraro

Patricia Hemingway Hall

Ulice Payne, Jr.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
     

In addition, the charter of the audit committee provides that the audit committee shall review and approve all related party transactions that are material to ManpowerGroup’s financial statements or that otherwise require disclosure to ManpowerGroup’s shareholders, provided that the audit committee shall not be responsible for reviewing and approving related party transactions that are reviewed and approved by the board of directors or another committee of the board of directors. The audit committee did not take action by written consent during 2022.

 

 

 

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MEETINGS AND COMMITTEES OF THE BOARD

 

PEOPLE, CULTURE AND COMPENSATION COMMITTEE

   NUMBER OF MEETINGS IN 2022: 5  
 

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Elizabeth P. Sartain

Chair

 

Each member of the people, culture and compensation committee is “independent” within the meaning of the applicable listing standards of the New York Stock Exchange.

 

The functions of this committee are to:

 

•  review and approve the Company’s general compensation philosophies and principles;

 

•  establish the compensation of the chief executive officer of ManpowerGroup, subject to ratification by the independent members of the board of directors;

 

•  approve the compensation, based on the recommendations of the chief executive officer of ManpowerGroup, of any president and the chief financial officer, and certain other senior executives of ManpowerGroup;

 

•  establish officer stock ownership guidelines and monitor compliance with such guidelines;

 

•  determine the terms of any agreements concerning employment, compensation or employment termination, as well as monitor the application of ManpowerGroup’s retirement and other fringe benefit plans, with respect to the individuals listed above;

 

•  monitor the professional development of ManpowerGroup’s key executive officers;

 

•  review succession plans for the chief executive officer of ManpowerGroup, of any president and the chief financial officer and certain other senior executives of ManpowerGroup;

 

•  administer ManpowerGroup’s equity incentive plans and employee stock purchase plans and oversee ManpowerGroup’s employee retirement and welfare plans;

 

•  administer ManpowerGroup’s annual incentive plan;

 

•  oversee the administration of the Company’s clawback policy;

 

•  review and recommend the “Compensation Discussion and Analysis” to be included in our annual proxy statement;

 

•  discuss with management reports regarding the development, implementation and effectiveness of the Company’s policies and strategies relating to its human capital management function;

 

•  approve the retention, compensation and termination of outside compensation consultants, independent legal advisors or other advisors and have oversight of their work;

 

•  consider the independence of any outside compensation consultant, independent legal advisor or other advisor to the committee;

 

•  monitor the Company’s policies, objectives and programs related to diversity and inclusion and review the Company’s performance in light of appropriate measures; and

 

•  review the results of any advisory shareholder votes on executive compensation and consider whether to recommend adjustments to the Company’s executive compensation policies and practices as a result of such votes.

 

 

Members:

William Downe

William P. Gipson

Julie M. Howard

Muriel Pénicaud(1)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
     
(1)

Ms. Pénicaud’s appointment to the people, culture and compensation committee became effective in February 2023.

In accordance with the terms of its charter, the people, culture and compensation committee may from time-to-time delegate authority and assign responsibility with respect to such of its functions to officers of the Company, or to a subcommittee of the committee. The people, culture and compensation committee did not take any action by written consent during 2022.

 

 

 

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MEETINGS AND COMMITTEES OF THE BOARD

 

GOVERNANCE AND SUSTAINABILITY COMMITTEE

  NUMBER OF MEETINGS IN 2022: 4  
 
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Patricia Hemingway Hall

Chair

 

Each member of the governance and sustainability committee is “independent” within the meaning of the applicable listing standards of the New York Stock Exchange.

 

The functions of this committee are to:

 

•  recommend nominees to stand for election at annual meetings of shareholders, to fill vacancies on the board of directors and to serve on committees of the board of directors;

 

•  establish procedures and assist in identifying candidates for board membership;

 

•  review the qualifications of candidates for board membership, including any candidates nominated by shareholders in accordance with our bylaws;

 

•  periodically review the compensation arrangements in effect for the non-management members of the board of directors and recommend any changes deemed appropriate;

 

•  oversee the annual self-evaluation of the performance of the board of directors and each of its committees and oversee, or ensure another committee oversees, the annual evaluation of the performance of management;

 

•  establish and review, for recommendation to the board of directors, guidelines and policies on the size and composition of the board, the structure, composition and functions of the board committees, and other significant corporate governance principles and procedures;

 

•  review the Board’s leadership structure and recommend any changes deemed appropriate;

 

•  oversee the content and format of our code of business conduct and ethics and recommend any changes as deemed appropriate;

 

•  monitor compliance by the non-management directors with our code of business conduct and ethics;

 

•  review and approve the establishment of any stock ownership guidelines for the non-management directors of the Company and monitor compliance with such guidelines;

 

•  review and make recommendations to the board on proposals related to corporate governance, public policy or sustainability submitted by shareholders;

 

•  oversee and make recommendations to the board regarding ESG matters relevant to the Company’s business, including Company policies, opportunities, reporting and activities;

 

•  develop and periodically review succession plans for the directors;

 

•  periodically review the corporate governance guidelines and recommend any changes as deemed appropriate;

 

•  review and recommend categorical standards for determining non-management director independence consistent with the rules of the New York Stock Exchange and other requirements;

 

•  consider and recommend to the Board the action to be taken with respect to any resignation tendered by a director with respect to a change in professional responsibilities or personal circumstances; and

 

•  approve the retention, compensation and termination of any outside independent advisors to the committee.

 

 

Members:

Julie M. Howard

Ulice Payne, Jr.

Michael J. Van Handel

 

 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
     

The governance and sustainability committee has from time to time engaged director search firms to assist it in identifying and evaluating potential board candidates. The governance and sustainability committee took one action by written consent during 2022.

 

 

 

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Board Effectiveness and Evaluation

Our board of directors is committed to performing effectively for the benefit of the Company and its shareholders at both the board and committee level. Each year, the governance and sustainability committee oversees the board and committee evaluation process and determines the format and framework for the process.

Annual Evaluation Process with an Independent Consultant

The governance and sustainability committee engages a third-party consultant, experienced in corporate governance matters, to assist with the board and committee evaluation process. The purpose of the annual evaluation process is to ensure that the board continues to operate at a high level, with an opportunity for self-reflection and improvement.

Each year, directors are interviewed by the independent third party, and give specific feedback addressing various topics of focus that are determined in advance. Among other items, topics have included board effectiveness, corporate strategy, individual contributions, committee functioning, as well as suggestions to enhance the efficiency and productivity of the board in general. Individual director effectiveness is also included. Directors respond to questions designed to elicit this information, and the independent third party synthesizes the results and comments received during such interviews. These findings are then presented by the independent third party and the chair of the governance and sustainability committee to the full governance and sustainability committee and to the board, followed by a review and discussion by the full board. The chair of the governance and sustainability committee also provides any committee findings to each committee chair, which are used to facilitate discussion during the committee assessments that also occur annually. The board believes this facilitated process provides additional insight and perspective that it can utilize to further enhance effectiveness, including in areas such as board and committee composition, information flow between management and the board, development of materials for board discussion, focus on corporate strategy and director recruitment.

 

 

 

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Compensation Discussion and Analysis

Table of Contents

 

Background      26  
          
Executive Summary      26  

2022 Results Reflected Challenging Environment in 2022

     26  

2022 Key Committee Actions

     26  

Short-Term and Long-Term Incentive Payouts for 2022

     27  

Calculation of Financial Metrics

     29  

CEO Compensation was Driven by Company Performance

     30  

Key Compensation Practices

     31  
          
ManpowerGroup Compensation Principles      32  
          
Say on Pay Vote      33  
          
Shareholder Engagement      33  
          
Compensation Elements      34  
          
Target Total Compensation      37  
          
Market Positioning: 2022 Target Compensation in the Competitive Marketplace      38  

How We Determine the Competitive Market: Challenges in Identifying a Relevant Peer Group

     38  

The 2022 Peer Group

     38  

Additional Data Sources

     38  

Assessing Individual Factors

     38  
          
The Committee’s Decision-Making Process      39  
          
Components of the 2022 Executive Compensation Program — Base Salary      39  
          
Components of the 2022 Executive Compensation Program — Annual Cash Incentives      39  

How EPS, ROIC and Revenue are Calculated

     39  

Why the Company Uses EPS, ROIC and Revenue

     40  

The 2022 EPS, ROIC and Revenue Goals

     40  

Annual Incentive Award Opportunities

     41  

2022 Strategic KPIs and ESG Goals and Annual Incentive Award Payouts

     41  

Jonas Prising

     41  

John T. McGinnis

     42  

Michelle S. Nettles

     42  

Richard Buchband

     42  
          
Components of the 2022 Executive Compensation Program — Long-Term Incentives      43  

Performance Share Units

     43  

How the Company Sets EBITA Margin Percent Goals

     44  

Shares Earned under the Regular 2020 PSU Grant and the 2021 Special Grant

     44  

Restricted Stock Units

     45  

Stock Options

     45  

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

Career Shares, Retirement and Deferred Compensation Plans      45  
          
Other Benefits      46  

Severance Agreements

     46  
          
Governance Features of Our Executive Compensation Programs      46  

We Have Stock Ownership Guidelines for Executive Officers

     46  

We Have a Clawback Policy

     47  

We Prohibit Hedging, Pledging and Short-Sale Transactions

     47  
          
Other Material Tax Implications of the Executive Compensation Program      47  
          

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS — EXECUTIVE SUMMARY

 

Background

This compensation discussion and analysis (“CD&A”) describes ManpowerGroup’s executive compensation program for our executive officers for whom disclosure is required under the rules of the Securities and Exchange Commission (“SEC”). We refer to this group of executives as our named executive officers (“NEOs”).

 

NAME

   TITLE

Jonas Prising

   Chairman and Chief Executive Officer

John T. McGinnis

   Executive Vice President and Chief Financial Officer

Michelle S. Nettles

   Chief People and Culture Officer

Richard Buchband

   Senior Vice President, General Counsel and Secretary

 

 

Executive Summary

2022 Results Reflect Challenging Environment in 2022

Our executive compensation programs are designed to reward performance, and our results fell short of the challenging annual performance targets set by the People, Culture and Compensation Committee (the “Committee”) in February 2022. Over the course of the year, these financial objectives became more difficult to achieve in light of evolving macroeconomic trends. In particular, in late February the Russia-Ukraine war disrupted the European economic environment, where the majority of our business is located. As we progressed to the second half of 2022, we began to see a more pronounced slowing in the economic environment, most notably in Europe and then subsequently in North America. Despite these headwinds, our executive team was able to execute effectively in a fluid environment and accomplished the following:

 

   

We reported nearly $20 billion in revenue, reflecting a year-over-year increase after adjusting for currency, and delivered improvements in Earnings Per Share (“EPS”) and Return on Invested Capital (“ROIC”).

 

   

We enjoyed strong cash flow, which enabled us to increase our dividend, and to continue our return of cash to shareholders.

 

   

We improved our brands’ profitability compared to the prior year.

 

   

We completed the integration of the ettain group acquisition, disposed of smaller country operations with low returns, and continued to progress our objective of rebalancing our operations toward more profitable businesses.

 

   

We executed well against our strategic objectives. We continued to make important long-term investments in our technology infrastructure and progressed our Digitization, Diversification and Innovation initiatives. These are all designed to position the Company for sustainable profitable growth.

 

   

We continued our focus on our people and our corporate culture, and advanced our long-term commitment to ESG goals as demonstrated in our second annual Working to Change the World Plan.

2022 Key Committee Actions

The Committee adhered to its guiding principles in 2022, including its commitment to being market competitive in executive compensation and aligning pay with performance. The Committee took a number of important actions during the year, including:

 

   

Used a new compensation peer group for benchmarking 2022 NEO compensation that creates greater comparability to the Company’s business.

 

   

Introduced Earnings Before Interest, Taxes and Amortization (“EBITA”) Margin Percent as the performance metric for PSU grants to replace Operating Profit Margin Percent (“OPMP”). EBITA Margin Percent better aligns with how the Company and its largest competitors measure performance as it measures operating efficiency without the impact of amortization. In addition, EBITA Margin Percent continues to focus executive officers on the long-term profitability of the Company.

 

   

Expanded our emphasis on ESG objectives by repositioning our individual operating objectives for executives as Strategic KPIs and ESG Goals.

 

 

 

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Eliminated the granting of stock options as an element of executive pay.

 

   

Used Committee discretion to reduce to zero the payout from the original 2020 PSU award.

As disclosed last year, the pandemic disrupted the Committee’s normal target-setting process in 2020, and the immediate impact to the global economy appeared to make the targets set in February 2020 for the 2020-2022 PSU cycle nearly obsolete weeks after their adoption. The Committee elected not to modify or adjust these performance metrics. Instead, in February 2021, the Committee made a one-time award (the “2021 Special Grant”) designed to incentivize all PSU participants, including the executive team, to drive Company performance during 2021 and 2022. The grant reflected what the Committee determined to be more achievable OPMP targets and was sized at approximately two-thirds of the 2020 grant (the “Regular 2020 PSU Grant”), reflecting the two years remaining in the performance cycle.

By late 2022 it became apparent that the Regular 2020 PSU Grant would unexpectedly exceed its performance threshold on a formulaic basis. The Committee concluded it would not be appropriate for participants to receive the benefit of both the Regular 2020 PSU Grant and the 2021 Special Grant awards. Accordingly, the Committee used its negative discretion to reduce the payout of the Regular 2020 PSU Grant to zero, effectively cancelling the award. See page 43 for further information regarding the Regular 2020 PSU Grant and 2021 Special Grant.

Short-Term and Long-Term Incentive Payouts for 2022

 

Annual Incentive Payouts for 2022

 

Consistent with prior years, the Committee set key financial performance metrics in mid-February 2022, as summarized below.

 

•  EPS – Designed to focus our executives on producing financial results that align with shareholder interest. We consider this metric a critical measure of executive performance.

  

•  ROIC – Even though we operate in the services industry, our business is capital intensive. We must pay our associates and consultants before we typically bill and collect from our clients. ROIC measures how efficiently we are converting our services into cash.

  

•  Revenue – We believe Revenue is a key metric as it keeps executives focused on top-line growth, in addition to profitability.

 

Additionally, the Committee set KPIs for executives based on individual Strategic KPIs and ESG goals.

 

The financial metrics were achieved between the threshold and target levels for EPS, ROIC and Revenue, and these, combined with individual Strategic KPIs and ESG Goals were used to determine the individual payouts for the NEOs.

 

 

 

 

Long-Term Incentive Payouts for 2022

 

2022 Operating Profit Margin Percent (“OPMP”) recorded year-over-year improvements for purposes of our compensation plans.

 

•  PSUs represent the largest component of performance pay for our NEOs. For the PSUs granted prior to 2022, our key performance metric was OPMP, which measures how efficiently our executive officers deployed our operating resources to generate a profit.

 

OPMP performance exceeded the benchmarks set by the Committee for the 2021 Special Grant. As described above, this grant, utilizing a two-year measurement period of 2021 and 2022, was sized at two-thirds of the Regular 2020 PSU Grant, and achieved a payout at the outstanding level.

 

OPMP performance ended up being above threshold, on a formulaic basis, for the Regular 2020 PSU Grant, which covered a performance period of 2020 through 2022. For the reasons described above, the Committee reduced the payout on this award to zero and the shares were returned to the equity pool.

 

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS — EXECUTIVE SUMMARY

 

Annual Incentive Plan Metrics

(2022)

 

 

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Performance under the financial targets in the Annual Incentive Plan was between the threshold and target levels. The resulting AIP payouts ranged from 86% to 91% of target for the NEOs.

 

PSU Performance Metric — Operating Profit Margin Percent

The performance period ended in 2022 for two separate PSU awards:

 

 

The 2020 Regular PSU Grant. This award, made in February 2020, covered a three-year performance cycle ending in 2022. As discussed above, in late 2022 the Committee used its negative discretion, and set the payout at zero for this award.

 

 

The 2021 Special Grant. This smaller award, made in February 2021, covered a two-year performance period ending in 2022. This grant was made based on expectations at the time that threshold performance levels under the 2020 Regular PSU Grant would not be achieved.

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS — EXECUTIVE SUMMARY

 

2021 Special PSU Grant

(2021 - 2022 performance cycle)

 

 

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The average OPMP for the 2021-2022 performance cycle under the 2021 Special Grant was 3.15%. The Committee elected not to apply the KPI modifier to reduce the payout, resulting in a PSU payout percentage of 200%. The size of the 2021 Special Grant was approximately two-thirds of the Regular 2020 PSU Grant value.

 

Calculation of Financial Metrics

One of our principles is that NEO compensation should reward for the underlying performance of our business. As is our practice, the Committee, in adopting financial targets at the beginning of the 2022 performance year, determined that certain items should be excluded from our performance metrics:

 

 

Constant Currency. We eliminate the impact of changes in exchange rates for EPS, ROIC and Revenue. This allows us to better capture year-over-year changes in underlying performance.

 

 

Share Repurchases. We remove the benefit of share repurchases from our EPS calculation except to the extent necessary to offset dilution resulting from shares issued under our equity plans.

 

 

Restructuring Costs. We exclude restructuring costs from our EPS, ROIC, OPMP and EBITA Margin Percent calculations, net of the savings related to these costs. This allows us to better reflect the Company’s performance for the year.

 

 

Goodwill Impairment. We exclude goodwill impairment charges from our EPS, ROIC, OPMP and EBITA Margin Percent calculations. This, too, better reflects the Company’s performance for the year.

 

 

Other Non-Recurring Costs. We exclude from EPS, OPMP and EBITA Margin Percent any non-recurring accrual adjustments including tax or regulatory law changes, acquisitions or dispositions and other non-recurring adjustments greater than $10 million. As explained above, excluding these costs better reflects the Company’s performance during the year.

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS — EXECUTIVE SUMMARY

 

The following table shows the impact of each of these items on our performance metrics for 2022:

 

    AS
REPORTED
    IMPACT OF
CONSTANT
CURRENCY
    IMPACT OF
SHARE
REPURCHASES
    RESTRUCTURING
COSTS
    GOODWILL
IMPAIRMENT
    OTHER
NON-
RECURRING
COSTS(1)
    AS
CALCULATED
UNDER
COMPENSATION
PLANS
 

EPS

  $ 7.08     $ 0.88     $ (0.19   $ 0.06     $ 0.99     $ 0.41     $ 9.23  

ROIC

    12.8     1.5     n/a       0.1     1.1     0.6     16.1

Revenue (in billions)

  $ 19.8     $ 1.9       n/a       n/a       n/a     $ 0.10     $ 21.8  

OPMP (for grants made prior to 2022)

    2.93     n/a       n/a       0.02     0.25     0.13     3.33

EBITA Margin Percent (for grants made beginning in 2022)

    3.12     n/a       n/a       0.02     0.25     0.12     3.51

 

(1)

The EPS, ROIC, OPMP and EBITA Margin Percent metrics exclude integration costs incurred in 2022 associated with the acquisition of ettain group that occurred during the fourth quarter of 2021. The total impact of these integration costs resulted in a net increase to EPS of $0.21, ROIC of 0.3%, OPMP of 0.07% and EBITA Margin Percent of 0.07%. Other non-recurring adjustments also resulted in an increase to EPS of $0.20, ROIC of 0.3%, Revenue of $0.1 billion, OPMP of 0.06% and EBITA Margin Percent of 0.05% related to dispositions, including the impact of the sale of our Russia business that was completed in the first quarter of 2022.

CEO Compensation was Driven by Company Performance

We remain committed to performance-based compensation. Approximately 60% of Mr. Prising’s 2022 target compensation was tied to Company performance and 91% of his total pay was variable. The discussion below highlights each component of Mr. Prising’s compensation in 2022.

Base Salary: The Committee determined to keep Mr. Prising’s base salary for 2022 at $1,250,000. Mr. Prising’s base salary has been unchanged since 2017, with the exception of the temporary reduction in 2020 due to COVID.

Annual Cash Incentive: Payout was Approximately 86% of Target. All of the financial metrics set by the Committee for the 2022 annual incentive were below the target level, as shown below. In light of this, and the Committee’s assessment of Mr. Prising’s achievement of his individual Strategic KPIs and ESG Goals as CEO, his annual cash incentive payout was 86.3% of target.

 

     2022 ACTUAL
PAYOUT $
       % COMPARED
TO TARGET
 

EPS Goal

     441,532          88.3

ROIC Goal

     422,414          84.5

Revenue Goal

     236,364          59.1

Strategic KPIs and ESG Goals

     625,000          104.0

Total

     1,725,310          86.3

Long-Term Equity Awards. In 2022, Mr. Prising received two types of long-term equity grants as part of his regular compensation:

 

 

Approximately 60% comprised an annual grant of PSUs that will vest over three years based on EBITA Margin Percent goals.

 

 

Approximately 40% were restricted stock units (“RSUs”) that cliff vest in full after three years.

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS — EXECUTIVE SUMMARY

 

Key Compensation Practices

The Committee continually reviews the Company’s executive compensation program to maintain compensation practices that are in the best interests of our shareholders. Some of our key policies are summarized below:

 

    What We Do    
  LOGO   Tie executive pay to performance.           
  LOGO   Set challenging performance objectives that align with company performance.  
  LOGO   Balance short-term and long-term incentives.  
  LOGO   Include caps on the potential payouts under the PSU grants and our annual incentive program.  
  LOGO   Use double triggers in our severance agreements and our equity awards.  
  LOGO   Maintain significant stock ownership guidelines for our NEOs.  
  LOGO   Maintain a clawback policy for our cash incentive and equity awards.  
  LOGO   Retain an independent compensation consultant.  
  LOGO   Establish appropriate compensation peer groups which the Committee re-evaluates annually.  
  LOGO   Reach out to leading shareholders and their advisory firms to discuss our executive compensation.  
  What We Don’t Do  
 

 

LOGO

  No dependence on Total Shareholder Return (“TSR”) as a performance metric for our NEOs. In our experience, TSR captures fluctuations in stock price, rather than measuring the performance of our executive team in operating our business. Our stock price can be sensitive to perceived changes in the global economic climate, with fluctuations in stock price that are often de-coupled from the fundamentals of our business.  
  LOGO   No tax gross up payments for any amounts considered excess parachute payments.  
  LOGO   No dividends or dividend equivalents prior to vesting.  
  LOGO   No repricing of stock options.  
  LOGO   No hedging or pledging of ManpowerGroup stock.  
  LOGO   No excessive perquisites to our NEOs or tax gross up payments.  

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

ManpowerGroup Compensation Principles

The Company’s executive compensation framework is guided by a series of core philosophies and principles, as determined by the Committee.

 

 

EXECUTIVE COMPENSATION FRAMEWORK

CORE PHILOSOPHIES AND PRINCIPLES:

 

 

 

1. Aligned to Stakeholders

 

•  Compensation programs align executives’ interests with those of our stakeholders and appropriately balance risk and rewards

 

•  Stakeholder value is created by:

 

–  Sound fiscal management and shareholder value creation

 

–  Attracting and retaining the best talent needed to scale

 

–  Cultivating and enhancing the Company’s brand, purpose, and vision

 

–  Excellent client, employee, candidate, and associate experiences

 

2. Performance-Focused

 

•  The majority of pay for executives is at-risk and performance-based

 

•  Compensation is designed to motivate the executives to achieve the Company’s annual and long-term strategic goals

 

•  Recognize the cyclical nature of our business, with clearly defined KPIs to drive focus

 

3. Market-Competitive

 

 

•  Compensation opportunities are anchored to the competitive market

 

•  Ensure rewards are fair and equitable for each role

 

•  Compensation is differentiated to consider individual value and contribution

 

4. Transparent and

     Relevant

 

•  Compensation programs are clearly communicated and easy to understand

 

•  Programs include metrics that are core to the business and have line of sight for executives

 

 

5. Aligned to Our Values

 

•  Ensure rewards are fair and equitable among internal peers

 

•  Compensation design and administration should align to our values of People, Knowledge, and Innovation

 

 

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

Say on Pay Vote

 

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ManpowerGroup held a non-binding shareholder advisory vote at its 2022 annual meeting of shareholders to approve the compensation of ManpowerGroup’s NEOs, also known as “Say on Pay.” This shareholder resolution was approved by approximately 94% of the votes cast. This was the ninth consecutive year we received a Say on Pay result above 90%.   

 

LOGO

Shareholder Engagement

We believe that shareholder engagement is an important part of our governance practices. We have a longstanding shareholder outreach program, to provide our investors an opportunity to share their perspectives on our compensation philosophies and our governance structure, and to answer their questions. These efforts are conducted by members of executive management and may include board leadership. Our engagement efforts over time have included:

 

 

Contacting our top shareholders, representing more than 50% of our shares.

 

 

Conversations with shareholders representing more than 30% of our shares.

 

 

Presenting shareholder feedback to the Committee as well as the governance and sustainability committee.

The Committee evaluates this feedback from our shareholders, as well as our say on pay voting results (approximately 94% in 2022), among other factors in developing our executive compensation programs. Similarly, our governance and sustainability committee reviews the feedback concerning our governance practices in developing our governance policies, including our approach to board refreshment.

Additionally, our executive management team, primarily through our Chairman and CEO and Executive Vice President and CFO, regularly engage in dialogue with our shareholders through our quarterly earnings calls, investor meetings and conferences, and other channels for communication.

 

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

Compensation Elements

The following are the main elements used by ManpowerGroup in its compensation program in 2022 along with key decisions by the Committee related to those elements:

 

       

COMPENSATION ELEMENT

  KEY CHARACTERISTICS   OBJECTIVE AND DETERMINATION   2022 DECISIONS
   

Base Salary

  Fixed compensation for performing the core areas of responsibility.  

Provide amounts that are competitive in the markets in which we operate. Amounts are reviewed annually and adjusted when appropriate.

 

Factors used to determine base salaries:

 

•  NEO’s experience, skill, and performance.

 

•  The breadth of the NEO’s responsibilities.

 

•  Pay relative to market.

  None of the NEOs received an increase in base salary in 2022.
   

Annual Incentive Award

  Variable compensation payable in cash under the Annual Incentive Plan (“Incentive Plan”) based on performance against annually established goals and assessment of individual performance.  

Motivate and reward NEOs for achievement of key strategic, operational and financial measures over the year.

 

Measures used to determine annual incentive for NEOs in 2022:

 

•  The performance metrics used to determine annual incentive were EPS, ROIC and Revenue for all NEOs.

 

•  The maximum individual limit in any year under the Incentive Plan is $5 million.

 

The EPS, ROIC and Revenue levels achieved were between the threshold and target levels.

 

•  Each of the NEOs received a percentage of their incentive for achieving a specified level of their individual Strategic KPIs and ESG Goals.

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

       

COMPENSATION ELEMENT

  KEY CHARACTERISTICS   OBJECTIVE AND DETERMINATION   2022 DECISIONS
   

PSUs

 

Variable compensation payable in shares of stock.

 

The PSUs vest based on achievement of a pre-established performance metric over a period of time. If goals are not met, shares are not received.

 

Motivate and reward NEOs for performance against long-term financial objectives to align the interests of the NEOs with long-term shareholder value. Target amount awarded is determined based on job scope, market practice and individual performance.

 

Measures used to determine PSUs earned:

 

•  A threshold level of average EBITA Margin Percent must be achieved during the 2022-2024 performance period to receive any PSU vesting. OPMP was the financial metric for all PSU grants prior to 2022.

 

•  Payout levels for threshold, target and outstanding results are determined, and the actual payout percentage is calculated by interpolation.

 

•  However, if average EBITA does not meet a certain pre-determined dollar “gate” over the performance period, NEOs will not receive more than 100% of the target level payout.

 

•  The PSUs granted in 2022 include a KPI modifier to the final PSU payout that can increase or decrease the final payout by up to 30%. At the end of the performance period, the Committee will assess the achievement of pre-established strategic growth objectives and increase or decrease the final payout percentage by up to 30%. The KPI modifier cannot be used to adjust the total payout below threshold or exceed outstanding levels.

 

In 2022, PSUs represented approximately 60% of the total long-term equity incentive grants awarded to the NEOs as part of their annual target compensation grant.

 

Each of the NEOs was awarded a PSU grant in February 2020 (the “2020 Regular PSU Grant”) immediately before the start of the pandemic, covering performance over the three-year period of 2020, 2021, and 2022. The Committee elected not to modify or adjust the awards, even though the ultimate- financial targets appeared unachievable throughout 2020 based on the pandemic-impaired performance of the Company. Instead, the Committee took action in February 2021, and, recognizing the importance of proper incentivization for the executive team for the remainder of the 2020-2022 PSU cycle, made a one-time special PSU grant in February 2021 (the “2021 Special Grant”) with a two-year performance and vesting period. This grant reflected what the Committee determined to be more achievable OPMP targets for 2021 and 2022, the remaining two years of the 2020 grant cycle, and was sized at approximately two-thirds of the 2020 PSU grant value. By late 2022, it appeared that the 2020 Regular PSU Grant would actually achieve its threshold OPMP level and was on track to pay out above threshold, on a formulaic basis. In light of the performance of the 2021 Special Grant (see below) the Committee determined participants should not receive the benefit of both the 2020 Regular PSU Grant and the 2021 Special Grant. Accordingly, in late 2022, the Committee utilized negative discretion available to it under the Plan and reduced the payout under the 2020 Regular PSU grant to zero.

 

Under the 2021 Special Grant, the NEOs earned 200% of target performance share units based on average OPMP performance for the two-year performance period ended December 31 2022. As noted above, the Special Grant was smaller in size than the annual PSU awards made in 2020 or in 2021.

 

Beginning in 2022, PSU grants to the NEOs include the right to accrue dividend equivalents that will be paid if and when the shares vest.

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

       

COMPENSATION ELEMENT

  KEY CHARACTERISTICS   OBJECTIVE AND DETERMINATION   2022 DECISIONS
   

RSUs

  Variable compensation payable in shares of stock. 100% of the RSUs vest on the third anniversary date.  

RSUs cliff vest in full after three years and are paid in stock. Dividend equivalents are accumulated on the RSUs and vest on the same basis as the underlying award.

 

•  Through stock price and dividend equivalents, RSUs directly align NEOs with the shareholders and add balance to the compensation program as they provide both upside potential and downside risk and add an additional retention incentive. Amount awarded is determined based on job scope, market practice and individual performance.

  Approximately 40% of all of the NEOs’ long-term equity incentive grants awarded in 2022 were in the form of RSUs.
   

Stock Options

  Nonqualified stock options that expire in ten years and become exercisable ratably over four years.   Align the interests of the NEOs with long-term shareholder value as well as retain executive talent. Amount awarded is determined based on job scope, market practice and individual performance.   Beginning in 2022, the Committee eliminated stock options as an element of executive pay.
   

Qualified Retirement Plans

  Generally not available to NEOs.  

No pension plan benefit in the United States.

 

Although we maintain a qualified 401(k) plan in the United States, our NEOs are not eligible to participate (except as described in the following sentence) because of limitations on participation by highly compensated employees under the rules governing such plans. NEOs are eligible to participate only in the first year of their employment (after which they are eligible to participate in the nonqualified savings plan) and in making catch-up contributions for individuals over the age of 50.

  Mr. Buchband participated in the catch-up contribution under the 401(k) plan in 2022.
       

Nonqualified Savings Plan (“NQSP”)

  Similar to a 401(k) plan, however not as flexible in regard to timing of the payouts of the retirement benefits for qualified plans. These benefits are unsecured and subject to risk of forfeiture in bankruptcy.   Used to provide NEOs with reasonably competitive benefits to those in the competitive market. NEOs are eligible to participate after the first year of employment.   All of the NEOs participated in the NQSP in 2022 and received a discretionary profit-sharing contribution.
   

Career Shares

  Used selectively by the Committee, taking into account what is most appropriate for a NEO in view of the retention incentive provided by the award. Career Shares vest completely on a single date several years into the future.   Used as an incentive in the form of RSUs to attract and retain executives. The Committee considers each year whether to make any such grants and to whom.   Mr. McGinnis and Ms. Nettles each received a career share grant in 2022 that will cliff vest in 2027.
       

Other Benefits

  Used to attract and retain talent needed in the business.   Additional benefits include financial planning reimbursement, broad-based automobile benefits, selected benefits for expatriate executives, participation in broad-based employee benefit plans, and certain other benefits required by local law or driven by local market practice.   Limited participation by the NEOs in these programs.

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

Target Total Compensation

Target total compensation is the value of the compensation package that is intended to be delivered based on performance against pre-established goals. The following chart illustrates for each of the NEOs the composition of his or her target total compensation for 2022.

2022 Target Compensation Components

 

LOGO

The Committee’s compensation consultant, Mercer, provides the Committee with market data that is used in setting target levels for compensation for the NEOs. Actual compensation paid out to the NEOs in a given year may vary significantly from the target levels depending on the actual performance achieved under the pre-established financial and operating goals set by the Committee.

This table outlines the values of each of the NEOs’ total target compensation values and the percentage that is variable (both short- and long-term) and performance-based (both short- and long-term).

2022 NEO Target Compensation

 

NEO

  BASE
SALARY $
    ANNUAL
INCENTIVE $
    PERFORMANCE
SHARE
UNITS (1) $
    RESTRICTED
STOCK UNITS $
    TOTAL 2022
TARGET
COMP $
    % TOTAL
2022
TARGET
COMP
VARIABLE(1)
   

% TOTAL 2022
TARGET

COMP
PERFORMANCE-
BASED(2)

 

Jonas Prising

    1,250,000       2,000,000       6,000,027       4,000,018       13,250,045       91     60

John T. McGinnis

    746,750       821,425       1,799,982       1,199,988       4,568,145       84     57

Michelle S. Nettles

    566,500       424,875       750,003       500,002       2,241,380       75     52

Richard Buchband

    540,750       405,563       600,016       400,011       1,946,340       72     52

 

(1)

Includes annual incentive, PSUs and RSUs.

 

(2)

Includes annual incentive and PSUs.

The Committee also considers how much incentive compensation is short-term in nature, and how much is long-term, with the intention that a significant portion of incentive compensation be based on the long-term performance of the Company. This reduces the risk that executives will place too much focus on short-term achievements to the detriment of the long-term success of the Company.

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

Market Positioning: 2022 Target Compensation in the Competitive Marketplace

How We Determine the Competitive Market: Challenges in Identifying a Relevant Peer Group

In alignment with its compensation principles, the Committee devotes considerable effort to identifying an appropriate competitive market for benchmarking our executive compensation. The Committee has determined that simply benchmarking against other U.S. companies in our industry would not yield a meaningful peer group — we present a different profile, being significantly larger, more complex, and more global in scope than other U.S.-listed companies in our industry.

Our two largest competitors, Adecco and Randstad, are based in Europe, and although we review available compensation data for these two companies, their pay practices are different and disclosure practices differ. Our nearest U.S. public competitor had much smaller revenue — approximately $7 billion in 2022 compared to our revenue of nearly $20 billion — and the other U.S. public competitors are even smaller. Mercer has confirmed to the Committee that attempting to use such competitors would not produce relevant data.

The 2022 Peer Group

For 2022, Mercer developed and the Committee adopted a new peer group methodology to create greater comparability to the Company’s business. The methodology includes the following factors, which the Committee determined were important: (i) similar size to ManpowerGroup in revenues, or market capitalization; (ii) companies in the service sector and with global footprints and comparable margin profiles; and (iii) companies where ManpowerGroup is identified as a peer company by the issuer or by proxy advisory firms. This peer group is considerably smaller, and more targeted than the peer group utilized for target setting in 2021 and earlier years. The new peer group of 23 companies is designed to align with these priorities on a composite basis.

 

2022 Peer Group Companies

Aramark

   EOG Resources, Inc.    Nucor Corporation

Baker Hughes Co.

   Fluor Corporation    PACCAR Inc.

CBRE Group, Inc.

   General Mills, Inc.    Textron Inc.

CDW Corp.

   Genuine Parts Co    The Clorox Co.

CH Robinson Worldwide Inc.

   Hewlett Packard Enterprise Co.    The Gap, Inc.

Cummins Inc.

   International Paper Company    Western Digital Corporation

Dollar Tree, Inc.

   Jacobs Engineering Group Inc.    WW Grainger Inc.

DXC Technology Company

   Kohl’s Corporation     

Additional Data Sources

The Committee also utilizes data from U.S. compensation surveys published by Mercer and other third-party data providers that are recommended by Mercer as a means to evaluate compensation for certain NEO positions. The CEO and CFO positions were only compared to companies within the peer group for 2022. Compensation for global functional leaders was compared against compensation survey data recommended by Mercer for executives with similar roles and responsibilities. Ms. Nettles’s position was compared to a composite of U.S. compensation survey data of Chief Human Resources Officers and top functional officers within the peer group for 2022. Mr. Buchband’s position was compared with U.S. compensation survey data of legal executives.

Assessing Individual Factors

An individual NEO’s total compensation or any element of compensation may be adjusted upwards or downwards relative to the competitive market based on a subjective consideration of the NEO’s experience, potential, tenure and results (individual and relevant organizational results), the NEO’s historical compensation, and any retention concerns. The Committee uses a historical compensation report to review the compensation and benefits provided to each NEO in connection with its compensation decisions concerning that NEO.

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

The Committee’s Decision-Making Process

The Committee determines the CEO’s compensation levels, including base salary, establishing and determining the achievement of the financial goals and Strategic KPIs and ESG Goals for the annual cash incentives, and any equity-based compensation awards. Generally, the CEO establishes and recommends the achievement of the goals and objectives for the annual incentives for the other NEOs, with the Committee making the final determinations. Similarly, the CEO generally recommends to the Committee any salary adjustments, cash incentive awards or equity-based awards for the other NEOs, which are then evaluated and determined by the Committee. Mercer provides input to the Committee regarding the final compensation for all of the NEOs. This input reflects the Company’s performance results for 2022, external market references against the peer group, internal compensation references and the individual performance of each of the NEOs. Under the Committee’s charter, compensation for our CEO and CFO is subject to ratification by the board of directors. Accordingly, the board of directors ratified the determinations for Mr. Prising and Mr. McGinnis.

Components of the 2022 Executive Compensation Program — Base Salary

Base salaries for NEOs are set based on the median of base salaries paid in the relevant competitive market, for the particular position, subject to individual performance factors as described earlier.

Base salary levels affect the value of the annual incentive awarded to the NEOs because the incentive is awarded as a percentage of base salary. A higher base salary will result in a higher annual incentive, assuming the same level of achievement against goals. The level of severance benefits each NEO may receive is also increased if his or her salary is increased. The value of long-term incentive awards is not determined as a multiple of base salary. As noted above, none of the NEOs received an increase in base salary for 2022.

Components of the 2022 Executive Compensation Program — Annual Cash Incentives

The Incentive Plan provides for the payment of annual cash rewards to a participant based on the Company’s attainment of one or more financial goals and Strategic KPIs and ESG Goals established for that participant for the relevant year. Incentive amounts are based on achievement of pre-established goals using these metrics. The financial goals include EPS, ROIC and Revenue. The Strategic KPIs and ESG Goals are tied to broad strategic or operational initiatives.

How EPS, ROIC and Revenue are Calculated

The annual cash incentives for NEOs for 2022 are based on three objective factors — EPS, ROIC, Revenue — and individual Strategic KPIs and ESG Goals. When setting the 2022 targets, which occurred in mid-February 2022, the Committee determined that certain items should be excluded from our performance metrics as described in the calculations below:

 

   

EPS — net earnings per share — diluted, including net earnings from continuing and discontinued operations, but excluding the impact of currency, any changes in accounting principles during the performance period, restructuring charges net of related savings, extraordinary items, goodwill impairment or the benefit of current year share repurchases in excess of dilution. Earnings per share are further adjusted for the following items: tax or regulatory law changes, accounting adjustments related to acquisitions or dispositions where the Company previously held ownership interest; and non-recurring adjustments exceeding $10 million pertaining to prior periods.

 

   

ROIC — consolidated net operating profit after taxes divided by average capital. Net operating profit equals earnings before income taxes plus net interest expense and goodwill impairment (including the results of continuing and discontinued operations) minus income taxes, excluding the impact of currency and restructuring charges net of related saving. ROIC is further adjusted for the following items: changes in accounting principles during the performance period, extraordinary items, benefits from current year share repurchases in excess of dilution, restructuring charges net of related savings, tax or regulatory law changes, adjustments related to acquisitions or dispositions where the Company previously held an ownership interest, and non-recurring adjustments exceeding $10 million pertaining to prior periods. Average capital is the average monthly ending balance of capital employed plus or minus certain adjustments.

 

   

Revenue — Revenue during the period, including continued and discontinued operations. Revenue is adjusted to exclude the impact of currency, changes in client contracts that result in a change from gross to net accounting and the same adjustments as made to EPS, as applicable.

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

See page 29 for a discussion of the specific items excluded from EPS, ROIC and Revenue for 2022.

The EPS target is generally based on the Company’s targeted long-term growth rate for EPS, but may be adjusted year-by-year based on economic conditions and the Company’s expected financial performance for the year. From that target, the Committee then sets levels for threshold and outstanding performance. The threshold EPS growth rate reflects a level of performance that is below target but still appropriate for a partial award to be earned. Conversely, the outstanding EPS growth rate reflects a level of performance appropriate for the maximum incentive to be earned. So the comparisons are valid between the two years, the growth rates are based on growth over results of the previous year excluding non-recurring items.

The ROIC target is determined based on the earnings growth reflected by the EPS target as well as consideration by the Committee of factors relating to the Company’s level of capital. The Revenue target is generally based on the Company’s targeted long-term growth rate for Revenue. Similar to EPS, it may be adjusted year-by-year based on economic conditions and the Company’s expected financial performance for the year.

This methodology is not the same as the Company’s financial budgeting or business outlook for the year. As a result, target performance for purposes of achieving an incentive award will not be the same as performance as the budgeted financial plan, which may be higher or lower than target performance depending on economic conditions and trends at the time.

Why the Company uses EPS, ROIC and Revenue

The Committee believes using EPS as a performance goal keeps the NEOs focused on producing financial results that align with shareholder interests. In that regard, ManpowerGroup is in a cyclical business, which is influenced by economic and labor market cycles that are outside of ManpowerGroup’s control, and it is important that the senior executives manage short-term results closely to be able to adjust strategy and execution in quick response to external cycle changes. The Company uses ROIC as a performance goal for the NEOs because it measures how effectively our senior management is converting our services into cash. Although we are a provider of services, and not a manufacturer of products, our business is still highly capital intensive. Our requirement for capital arises from the timing characteristics of our business. We typically pay our associates and consultants before we can bill and collect from our clients. Using an ROIC metric incentivizes our executives to carefully manage our accounts receivable and other capital investments in order to maximize the return on capital deployed. Our goal is to continuously improve our internal capital employed each year resulting in stable to improving ROIC. The Company uses Revenue as a performance goal in order to incentivize top-line growth, in addition to profitability. The percentage weightings of each of the metrics is as follows:

 

METRIC

     2022 WEIGHTING  

EPS Goal

       25.0

ROIC Goal

       25.0

Revenue Goal

       20.0

Strategic KPIs and ESG Goals

       30.0

Total

       100.0

The 2022 EPS, ROIC and Revenue Goals

For 2022, the Committee continued its practice of setting threshold, target and outstanding goals for EPS and ROIC that were based on its view of appropriate rates of EPS growth compared to prior year achievement. Similarly, the Committee set threshold, target and outstanding goals for Revenue that were based on its view of appropriate Revenue growth. The Committee believed the threshold levels for EPS, ROIC and Revenue were the minimum levels at which it would be appropriate to earn an incentive, based on global economic conditions as they existed at the time when the goals were set in mid-February 2022. Each year the Committee sets targets based on macroeconomic factors and the Company’s business outlook for the coming year and does so independently of where the target levels have been set for the prior year. Given the cyclical nature of our business, this may result in targets being set lower than for the prior year.

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

The following table shows the EPS, ROIC and Revenue goals established by the Committee for 2022:

 

METRIC

   THRESHOLD     TARGET     OUTSTANDING  

PAYOUT AS A % OF TARGET

   CEO AND CFO: 25%
OTHER NEOs: 33%
    ALL NEOs: 100%     All NEOs: 200%  

EPS (weighted 25%)

   $ 7.66     $ 9.52     $ 11.15  

ROIC (weighted 25%)

     13.8     16.7     19.1

Revenue (in billions) (weighted 20%)

   $ 21.3     $ 22.4     $ 23.3  

Annual Incentive Award Opportunities

The following table shows the total annual incentive award opportunities by NEO shown as a percentage of base salary:

 

NEO

     THRESHOLD AS
A PERCENTAGE
OF SALARY
     TARGET AS
A PERCENTAGE
OF SALARY
     OUTSTANDING AS
A PERCENTAGE
OF SALARY
 

Jonas Prising

       40.0      160.0      320.0

John T. McGinnis

       27.5      110.0      220.0

Michelle S. Nettles

       25.0      75.0      150.0

Richard Buchband

       25.0      75.0      150.0

2022 Strategic KPIs and ESG Goals and Annual Incentive Award Payouts

Jonas Prising

The Strategic KPIs and ESG Goals comprise 30% of the total annual incentive for Mr. Prising and were as follows for 2022:

 

 

Execute strategic initiatives focused on digitization and transformation of the business

 

 

Diversify the business

 

 

Strengthen global governance model, develop a robust and diverse talent pipeline, including deepening capabilities of employees and strengthen DEIB/ESG leadership position within the industry

 

 

Test and execute new delivery models to drive innovation

The Committee determined that Mr. Prising earned a cash incentive award for 2022 between threshold and target for EPS, ROIC and Revenue. The Committee also approved an incentive award to Mr. Prising based on its determination of the level of performance towards achievement of his various Strategic KPIs and ESG Goals. Based on these accomplishments, the Committee determined the amount of the 2022 award to be paid to Mr. Prising to be $1,725,310. The following table illustrates Mr. Prising’s 2022 achievement of the performance targets in relation to the payment of his 2022 award:

 

       PERFORMANCE
LEVEL
       PERCENTAGE
OF 2022 SALARY
     AMOUNT
EARNED
 

EPS Goal

       Above Threshold          35.3    $ 441,532  

ROIC Goal

       Above Threshold          33.8    $ 422,414  

Revenue Goal

       Above Threshold          18.9    $ 236,364  

Strategic KPIs and ESG Goals

       Above Target          50.0    $ 625,000  

Total Incentive

                  138.0    $ 1,725,310  

As previously stated, in adopting the financial targets for 2022, the Committee determined to exclude certain items from the calculation of EPS, ROIC and Revenue. See page 29 for a calculation of the 2022 financial metrics, including the impact of the certain items excluded.

 

 

 

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John T. McGinnis

The Strategic KPIs and ESG Goals comprise 30% of the total annual incentive for Mr. McGinnis and were as follows for 2022:

 

 

Deepen leadership impact to meet or exceed strategic and operational goals

 

 

Advance the Company’s growth strategy in certain brands

 

 

Develop a robust and diverse talent pipeline within the global finance function

 

 

Continue to progress the technology roadmap and other initiatives within global finance function

The Committee determined that Mr. McGinnis earned a cash incentive award for 2022 between threshold and target for EPS, ROIC and Revenue. The Committee also approved an incentive award to Mr. McGinnis based on its determination of the level of performance towards achievement of his various Strategic KPIs and ESG Goals. Based on these accomplishments, the Committee determined the amount of the 2022 award to be paid to Mr. McGinnis to be $740,000 The following table illustrates Mr. McGinnis’s 2022 achievement of the performance targets in relation to the payment of his 2022 award:

 

       PERFORMANCE
LEVEL
       PERCENTAGE
OF 2022 SALARY
     AMOUNT
EARNED
 

EPS Goal

       Above Threshold          24.3    $ 181,311  

ROIC Goal

       Above Threshold          23.2    $ 173,470  

Revenue Goal

       Above Threshold          13.0    $ 97,078  

Strategic KPIs and ESG Goals

       Above Target          38.6    $ 288,141  

Total Incentive

                  99.1    $ 740,000  

Michelle S. Nettles

The Strategic KPIs and ESG Goals comprise 30% of the total annual incentive for Ms. Nettles and were as follows for 2022:

 

 

Continue to execute diversification initiatives within certain brands

 

 

Progress the Company’s talent strategy, including deepening the talent pipeline and increasing gender diversity at the leadership level

 

 

Progress change management efforts to accelerate digitization strategy

 

 

Accelerate learnings and scale capabilities within certain functions

The Committee determined that Ms. Nettles earned a cash incentive award for 2022 between threshold and target for EPS, ROIC and Revenue. The Committee also approved an incentive award to Ms. Nettles based on its determination of the level of performance towards achievement of her various Strategic KPIs and ESG Goals. Based on these accomplishments, the Committee determined the amount of the 2022 award to be paid to Ms. Nettles to be $385,000. The following table illustrates Ms. Nettles’s 2022 achievement of the performance targets in relation to the payment of her 2022 award:

 

       PERFORMANCE
LEVEL
       PERCENTAGE
OF 2022 SALARY
     AMOUNT
EARNED
 

EPS Goal

       Above Threshold          16.8    $ 95,172  

ROIC Goal

       Above Threshold          16.2    $ 91,546  

Revenue Goal

       Above Threshold          9.5    $ 54,101  

Strategic KPIs and ESG Goals

       Above Target          25.5    $ 144,181  

Total Incentive

                  68.0    $ 385,000  

Richard Buchband

The Strategic KPIs and ESG Goals comprise 30% of the total annual incentive for Mr. Buchband and were as follows for 2022:

 

 

Continue to provide strong leadership and strategic direction to global legal function worldwide

 

 

Develop a robust and diverse talent pipeline within the legal function, including deepening capabilities of employees

 

 

Serve as trusted advisor to the board of directors and executive team

 

 

Continue to collaborate with business leaders on key strategic initiatives

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

The Committee determined that Mr. Buchband earned a cash incentive award for 2022 between threshold and target for EPS, ROIC and Revenue. The Committee also approved an incentive award to Mr. Buchband based on its determination of the level of performance towards achievement of his various Strategic KPIs and ESG Goals. Based on these accomplishments, the Committee determined the amount of the 2022 award to be paid to Mr. Buchband to be $352,000. The following table illustrates Mr. Buchband’s 2022 achievement of the performance targets in relation to the payment of his 2022 award:

 

       PERFORMANCE
LEVEL
       PERCENTAGE
OF 2022 SALARY
     AMOUNT
EARNED
 

EPS Goal

       Above Threshold          16.8    $ 90,846  

ROIC Goal

       Above Threshold          16.2    $ 87,385  

Revenue Goal

       Above Threshold          9.5    $ 51,642  

Strategic KPIs and ESG Goals

       At Target          22.5    $ 122,127  

Total Incentive

                  65.0    $ 352,000  

Components of the 2022 Executive Compensation Program — Long-Term Incentives

Each year the Committee determines the appropriate mix of PSUs, stock options and RSUs that should comprise the long-term incentives for the NEOs. This flexibility allows the Committee to tailor its program to create the incentive structure that it believes will best align executive performance and the needs of the Company. The Committee determined for 2022 that the annual grant of incentive awards to the NEOs should be made up of 60% PSUs and 40% RSUs. The Committee discontinued the use of stock options for its annual long-term incentive awards for 2022.

The Committee generally determines and approves equity awards to the NEOs and the related vesting schedules, at its regularly scheduled meeting in February each year, and as required under the Committee’s charter, subject to ratification by the board of directors in the case of Mr. Prising and Mr. McGinnis. The equity awards and related vesting schedules for Messrs. McGinnis and Buchband and Ms. Nettles are generally based on recommendations by Mr. Prising. The Committee may make grants to NEOs at other times during the year, as it deems appropriate.

The PSUs and RSUs awarded in 2022 have the characteristics below. The specific long-term incentive grants for each officer are shown in the Grants of Plan Based Awards table on page 50.

Performance Share Units

For the award of annual PSUs made in February 2022, the Committee returned to its customary use of a 3-year performance period. For the PSUs granted in 2022, vesting is based on achievement of a pre-established goal for average annual EBITA Margin Percent, over a three-year period ending December 31, 2024. The Committee determined EBITA Margin Percent should replace OPMP as it better aligns with how the Company and its largest competitors measure performance. EBITA Margin Percent measures operating efficiency without the impact of amortization while continuing to focus executive officers on the long-term profitability of the Company.

The Committee also included a KPI modifier that can increase or decrease the final PSU payout (which will be determined based on the EBITA margin for the performance period and the performance gate described below) by up to 30%, but not more than the outstanding award or less than the threshold award. Under this feature, the Committee established strategic growth objectives and will evaluate how well management has performed against those pre-established strategic growth objectives during the three-year period of the PSUs. The number of shares earned will vest and be settled in common stock in February 2025, after the Committee determines the achievement of the performance goals and assesses the achievement of the strategic growth objectives. The specific strategic growth objectives are summarized below.

 

 

 

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How the Company Sets EBITA Margin Percent Goals

The following table shows the goals established by the Committee in February 2022 for the three-year performance period for these PSUs and the associated payout percentage:

 

       THRESHOLD      TARGET      OUTSTANDING  

EBITA Margin Percent 2022-2024

       1.00      3.90      4.30

Payout Percentage

       0.0      100.0      200.0

To determine the average EBITA Margin Percent at the end of the three-year period, the actual performance results from each year will be averaged to determine the three-year average performance results. The final award will be determined by using the payout scale relative to the average performance.

When determining the financial goals for the 2022 grant, the Committee determined certain items would be excluded from the EBITA Margin Percent calculation, as described in the following calculation:

 

 

EBITA Margin Percent — annual operating profit plus amortization, divided by revenue from services, with adjustments to be made (a) to reverse the impact of a change in accounting principles during the performance period, or (b) for any of the following items: extraordinary items, goodwill impairment, nonrecurring restructuring charges, tax or regulatory law changes, adjustments related to acquisitions or dispositions where the Company previously held an ownership interest, any change in client contracts that result in a change from gross to net revenue accounting, non-recurring adjustments exceeding $10 million pertaining to prior periods. If an adjustment relates to an accrual from a prior period deemed an appropriate change in estimate in the current period, the adjustment impact will only be for the amount in excess of $10 million.

Our business is historically cyclical and is impacted by numerous macroeconomic conditions. The Committee sets each year’s target levels at the beginning of the year, based on both macroeconomic factors and the Company’s business outlook for the coming year, and does so independently of where the target levels have been set for the prior year. Given the cyclical nature of our business, this may result in targets being set lower than for the prior year.

An EBITA “gate” was also established for the PSUs to ensure EBITA margins are achieved without significantly decreasing revenues. This gate was set at $624.0 million, meaning participants cannot receive more than 100% of the target level payout unless average EBITA for the 2022-2024 performance period exceeds $624.0 million.

As mentioned above, the Committee included a KPI modifier to the final PSU payout that can increase or decrease the final PSU payout by up to 30%. At the end of the 3-year PSU vesting period, the Committee will assess the achievement of the strategic growth objectives and may increase or decrease the PSU payout percent (that was determined based on the EBITA Margin Percent for the performance period and the gate) by an amount up to 30% based on strategic growth objectives over the 3-year life of the award. The KPI modifier cannot decrease the payout below the threshold level nor increase the payout above the outstanding level. The following are the strategic growth objectives set by the Committee for 2022:

 

 

Broaden and deepen capabilities of our people to capitalize on digitization and strengthen DEI/ESG leadership within the industry;

 

 

Complete technology and transformation transition and strengthen digital brand and cyber security posture;

 

 

Advance global analytics and AI capabilities, strengthen global governance model, and grow the succession pipeline; and

 

 

Execute acceleration plan for growth within certain brands and shift business mix, test new delivery model innovations and test and execute diversification pilots for scalability.

Shares Earned under the Regular 2020 PSU Grant and 2021 Special Grant

As disclosed last year, the pandemic disrupted the Committee’s normal target-setting process in 2020, and the immediate impact to the global economy appeared to make the OPMP targets set in February 2020 for the Regular 2020 PSU Grant nearly obsolete weeks after their adoption. The Committee elected not to modify or adjust these performance metrics. Instead, in February 2021, the Committee made a one-time award (the 2021 Special Grant) designed to incentivize all PSU participants, including the executive team, to drive Company performance for the critical periods of 2021 and 2022. The grant reflected what the Committee determined to be more achievable OPMP targets and was sized at approximately two-thirds of the Regular 2020 PSU Grant value, reflecting the two years remaining in the performance cycle. These grants also included the KPI modifier feature.

 

 

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

 

Despite the projection that the Regular 2020 PSU Grant would never achieve a payout level of performance, by late 2022 it was apparent to the Committee that these awards would unexpectedly exceed the threshold on a formulaic basis. Late in 2022, the Committee concluded it would not be appropriate for participants to receive the benefit of both the Regular 2020 PSU Grant and the 2021 Special Grant. Accordingly, the Committee utilized its negative discretion to reduce the payout of the Regular 2020 PSU Grant for each of the participants to zero.

The Committee did not modify or adjust the 2021 Special Grant and based on the average operating profit margin percent for the 2-year performance period of 2021-2022, the Committee determined the 2021 Special Grant vested at the outstanding level which resulted in a payout of 200% of target. The operating profit dollar gate for these awards was also reached. The Committee elected not to apply the KPI modifier to reduce the payout of the 2021 Special Grant. These shares were vested and were settled in common stock in February 2023, after the Committee determined the achievement of the performance goals. The number of shares earned for each of the NEOs is as follows:

 

NEO

   PSUs GRANTED
AT TARGET(#)
     PSUs EARNED(#)  

Jonas Prising

     43,248        86,496  

John T. McGinnis

     12,975        25,950  

Michelle S. Nettles

     4,325        8,650  

Richard Buchband

     3,460