•Block Head (our version of Chief Executive Officer) Compensation. At his request, Jack Dorsey receives no cash or equity compensation except for an annual salary of $2.75. • Annual "Say-on-Pay" Vote. We conduct an annual non-binding advisory vote on the compensation of our named executive officers. At our 2022 annual meeting of stockholders, more than 98% of the votes cast on the "say-on-pay" proposal were voted in favor of the named executive officers’ compensation. •Clawback Policy. Our executive officers are subject to a clawback policy, which permits our board of directors to require forfeiture or reimbursement of incentive compensation if an executive engages in certain misconduct. •Independent Compensation Consultant. Our compensation committee engages its own independent compensation |
| | consultant to advise on executive and non-employee director compensation matters. BLOCK 2022 Proxy Statement•Alignment of Compensation with Company Success. A substantial percentage of our executive officers' compensation aligns with the long-term success of the company through grants of stock options and restricted stock-based awards. | | | iii•Risk Oversight. Strong oversight by our compensation committee mitigates risk and exposures. •Stock Ownership Guidelines. Our stock ownership guidelines require significant stock ownership levels and are designed to align the long-term interests of our executives and non-employee directors with those of our stockholders. |
TABLE OF CONTENTS
| | |
| BLOCK 2023 Proxy Statement | iii |
| BOARD OFOF DIRECTORS AND CORPORATE GOVERNANCE | |
Block, Inc., a Delaware corporation (referred to herein as the “Company���, “Block”, “we”,“Company,” “Block,” “we,” “us” or “our”), is committed to having sound corporate governance principles. Our business affairs are managed under the direction of our board of directors, which is currently composed of 1311 members. Mr. Viniar and Dr. Patterson, who are each Class I directors, have informed the Company of their decision to not stand for re-election at the Annual Meeting. Their decision to not stand for re-election was not a result of any disagreements with the Company on any matter relating to the Company’s operations, policies or practices. Their term as directors will end when their current term as Class I directors expires at the Annual Meeting. Concurrent with the Annual Meeting, the size of the board of directors will decrease from 13 directors to 11 directors. All of our directors, other than Messrs. Carter, Dorsey and McKelvey, are independent within the meaning of the listing standards of the New York Stock Exchange.Exchange (“NYSE”). Our board of directors is divided into three staggered classes of directors. At each annual meeting of stockholders, a class of directors will be elected for a three-year term to succeed the class whose term is then expiring. The following table sets forth the names, ages as of March 31, 2022April 28, 2023 and certain other information for each of the members of our board of directors with terms expiring at ourthe Annual Meeting, who are also nominees for election as a director at the Annual Meeting, and for each of the continuing members of our board of directors: Directors with Terms Expiring at the Annual Meeting/Nominees
| | | | | | | | | | | | | | | | | | | Jack Dorsey | | | I | | | 45 | | | Block Head and Chairperson | | | 2009 | | | 2022 | | | 2025 | Paul Deighton(1)* | | | I | | | 66 | | | Director | | | 2016 | | | 2022 | | | 2025 | Continuing Directors
| | | | | | | | | | | | | | | | | | | Roelof Botha(1)(2) | | | II | | | 48 | | | Director | | | 2011 | | | 2023 | | | — | Amy Brooks(3) | | | II | | | 47 | | | Director | | | 2019 | | | 2023 | | | — | Shawn Carter | | | II | | | 52 | | | Director | | | 2021 | | | 2023 | | | — | James McKelvey | | | II | | | 56 | | | Director | | | 2009 | | | 2023 | | | — | Randy Garutti(3) | | | III | | | 46 | | | Director | | | 2017 | | | 2024 | | | — | Mary Meeker(1) | | | III | | | 62 | | | Director | | | 2011 | | | 2024 | | | — | Sharon Rothstein(1) | | | III | | | 64 | | | Director | | | 2022 | | | 2024 | | | — | Lawrence Summers(2) | | | III | | | 67 | | | Director | | | 2011 | | | 2024 | | | — | Darren Walker(3) | | | III | | | 62 | | | Director | | | 2020 | | | 2024 | | | — |
| | | | | | | | | | | | | Name | | Class | | Age | | Position | | Director Since | | Current Term Expires | | Expiration of Term For Which Nominated | Directors with Terms Expiring at the Annual Meeting/Nominees | Roelof Botha⁽¹⁾⁽²⁾ | | II | | 49 | | Lead Independent Director | | 2011 | | 2023 | | 2026 | Amy Brooks⁽³⁾ | | II | | 48 | | Director | | 2019 | | 2023 | | 2026 | Shawn Carter | | II | | 53 | | Director | | 2021 | | 2023 | | 2026 | James McKelvey | | II | | 57 | | Director | | 2009 | | 2023 | | 2026 | | | | | | | | | | | | | | Continuing Directors | Randy Garutti⁽³⁾ | | III | | 48 | | Director | | 2017 | | 2024 | | — | Mary Meeker⁽¹⁾ | | III | | 63 | | Director | | 2011 | | 2024 | | — | Sharon Rothstein⁽¹⁾ | | III | | 65 | | Director | | 2022 | | 2024 | | — | Lawrence Summers⁽²⁾ | | III | | 68 | | Director | | 2011 | | 2024 | | — | Darren Walker⁽²⁾⁽³⁾ | | III | | 63 | | Director | | 2020 | | 2024 | | — | Jack Dorsey | | I | | 46 | | Block Head and Chairperson | | 2009 | | 2025 | | — | Paul Deighton⁽¹⁾⁽²⁾ | | I | | 67 | | Director | | 2016 | | 2025 | | — |
(1)
| Member of our compensation committee
|
(2)
| (1)Member of our audit and risk committee |
(3)
| Member of our nominating and corporate governance committee |
*
| Effective at the Annual Meeting, Mr. Deighton will join our audit and risk committee and serve as its Chair following Mr. Viniar’s departure. |
| | | BLOCK 2022 Proxy Statement
| | | 1
|
TABLE OF CONTENTS
Jack Dorsey is our co-founder and has served as our principal executive officer and as a member of our board of directors since July 2009, having previously served as our Chief Executive Officer and President since July 2009 until his title changed to Block Head as of April 2022. From May 2007 to October 2008, Mr. Dorsey served as President and Chief Executive Officer of Twitter, Inc. (“Twitter”). Mr. Dorsey returned to serve as Chief Executive Officer of Twitter from July 2015 until November 2021. He has served as a director of Twitter since May 2007 and will not stand for re-election at Twitter’s 2022 annual stockholders’ meeting. From December 2013 to March 2018, Mr. Dorsey served as a member of the board of directors of The Walt Disney Company.compensation committee.
Mr. Dorsey was selected to serve on our board of directors because of the perspective and experience he provides as one(2)Member of our foundersaudit and our Block Head, as well as his extensive experience with technology companies and innovation.risk committee. Paul Deighton has served as a member(3)Member of our boardnominating and corporate governance committee.
| | |
| BLOCK 2023 Proxy Statement | 1 |
Mr. Deighton was selected to serve on our board of directors because of his financial and business expertise, as well as his international perspective and his government and regulatory experience.
Director Nominees Roelof Botha has served as a member of our board of directors since January 2011 and has been appointed as our Lead Independent Director effective at the Annual Meeting.since June 2022. Since January 2003, Mr. Botha has served in various positions at Sequoia Capital, a venture capital firm, including as a Senior Steward and as a Managing Member of Sequoia Capital Operations, LLC. From 2000 to 2003, Mr. Botha served in various positions at PayPal Holdings, Inc., including as Chief Financial Officer. Mr. Botha currently serves on the boards of directors of 23andMe Holding Co., Bird Global, Inc., Eventbrite, Inc. (“Eventbrite”), Natera, Inc., MongoDB, Inc. and, Unity Software Inc., and a number of privately-heldprivately held companies. Mr. Botha has notifiedpreviously served on the boards of directors of Bird Global, Inc., from June 2018 to December 2022, and Eventbrite, that he does not planInc., from October 2009 to stand for re-election when his current term expires at the company’s 2022 annual meeting of stockholders, expected to be held in June 2022. Mr. Botha holds a B.S. in Actuarial Science, Economics and Statistics from the University of Cape Town and an M.B.A. from the Stanford Graduate School of Business. Mr. Botha was selected to serve on our board of directors because of his financial and managerial experience. Amy Brooks has served as a member of our board of directors since October 2019. Since November 2017, Ms. Brooks has served as President, Team Marketing & Business Operations and Chief Innovation Officer at the National Basketball Association, (“NBA”), after serving as Executive Vice President from May 2014 to November 2017 and Senior Vice President from January 2010 to | | | BLOCK 2022 Proxy Statement
| | | 2
|
TABLE OF CONTENTS
May 2014. Ms. Brooks also currently serves on the boardboards of directors of the Positive Coaching Alliance, a non-profit organization, and on the board of directors of a privately-heldprivately held company. Ms. Brooks holds a B.A. in Political Science and Communication from Stanford University and an M.B.A. from the Stanford Graduate School of Business. Ms. Brooks was selected to serve on our board of directors because of her sales and marketing experience as well as her expertise in growing a global brand. Shawn Carter has served as a member of our board of directors since May 2021. Known professionally as Jay-Z, Mr. Carter is a musician, songwriter, record executive, producer and entrepreneur. He has served as the co-founder and majority owner of Roc Nation LLC and founder of Marcy Media LLC, a full-service agency and entertainment company, since 2008 and co-founder and Manager of Marcy Venture Partners, L.P., a venture capital and private equity firm, since March 2019. SinceMr. Carter founded TIDAL, which is now majority owned by Block, in March 2015, he has beenand remains a founder, shareholder and artist of TIDAL, which is currently majority owned by Block.the music streaming service. Since 2014, Mr. Carter has served as the co-founder, managerManager and board member of Ace of Spades Holdings, LLC, a luxury champagne company, and serves on the boards of directors of a number of privately-heldprivately held companies. Mr. Carter has also served as the Chief Visionary Officer of TPCO Holdings Corp. (“TPCO Holdings”) since November 2020, and previously the Chief Brand Strategist of Caliva, from July 2019 until its acquisition by TPCO Holdings in November 2020. Since 2003, Mr. Carter has served as the founder of the Shawn Carter Scholarship Foundation, a charitable organization focused on education. He also currently serves on the board of directors of REFORM, a philanthropic organization advocating for criminal justice reform. Mr. Carter previously served as the Chief Visionary Officer of TPCO Holding Corp. (“TPCO Holding”) from November 2020 to 2023, and as the Chief Brand Strategist of CMG Partners, Inc., or Caliva, from July 2019 until its acquisition by TPCO Holding in November 2020.Mr. Carter was selected to serve on our board of directors because of his entrepreneurial experience and expertise in the music industry, which is valuable for our TIDAL business. James McKelvey is our co-founder and has served as a member of our board of directors since July 2009. Since March 2012, Mr. McKelvey has served in various positions at Mira Smart Conferencing, Inc., a digital conferencing company. Mr. McKelvey previously served on the boards of directors of MoneyonMobile, Inc. from May 2016 to August 2018 and Ajax I Holdings, Inc. from October 2020 to August 2021, and currently serves on the boards of directors of a number of privately-heldprivately held companies, as well as the Federal Reserve Bank of St. Louis. Mr. McKelvey holds a B.S. in Computer Science and a B.A. in Economics from Washington University in St. Louis. Mr. McKelvey was selected to serve on our board of directors because of the perspective and experience he brings as one of our founders. Continuing Directors Randy Garutti has served as a member of our board of directors since July 2017. Since April 2012, Mr. Garutti has served as Chief Executive Officer and on the board of directors of Shake Shack, Inc. (“Shake Shack”). Prior to becoming Chief Executive Officer, Mr. Garutti served as Chief Operating Officer of Shake Shack since January 2010. Before Shake Shack, Mr. Garutti was the Director of Operations for Union Square Hospitality Group, LLC, overseeing the operations for all its restaurants. Additionally, Mr. Garutti currently
| | |
| BLOCK 2023 Proxy Statement | 2 |
serves on the boardsboard of directors of USHG Acquisition Corp. and the Columbus Avenue Business Improvement District, a not-for-profit organization. He previously served on the board of directors of USHG Acquisition Corp. from February 2021 to December 2022. Mr. Garutti holds a B.S. in Hotel Administration from Cornell University's School of Hotel Administration. Mr. Garutti was selected to serve on our board of directors because of his business expertise and leadership of a global brand. Mary Meeker has served as a member of our board of directors since June 2011. Since January 2019, Ms. Meeker has served as a General Partner of Bond Capital. From December 2010 to December 2018, Ms. Meeker served as a General Partner of Kleiner Perkins Caufield & Byers. | | | BLOCK 2022 Proxy Statement
| | | 3
|
TABLE OF CONTENTS
From 1991 to 2010, Ms. Meeker worked at Morgan Stanleyserved as a Managing Director and Research Analyst.Analyst with Morgan Stanley. Ms. Meeker previously served on the boards of directors of LendingClub Corporation, from June 2012 to June 2019, and DocuSign, Inc., from July 2012 to June 2019, and currently serves on the boards of directors of Nextdoor Holdings, Inc. and a number of privately-heldprivately held companies. Ms. Meeker holds a B.A. in Psychology from DePauw University and an M.B.A. from Cornell University. Ms. Meeker was selected to serve on our board of directors because of her extensive experience advising and analyzing technology companies. Sharon Rothstein has served as a member of our board of directors since January 2022. Since October 2018, Ms. Rothstein has served as an Operating Partner at Stripes, LLC (“Stripes”), a growth equity firm. Prior to joining Stripes, Ms. Rothstein served as Executive Vice President, Global Chief Marketing Officer, and subsequently, as Executive Vice President, Global Chief Product Officer of Starbucks Corporation (“Starbucks”) from April 2013 to February 2018. Prior to joining Starbucks, Ms. Rothstein held senior marketing and brand management positions with Sephora, Godiva, Starwood Hotels and Resorts, Nabisco Biscuit Company and Procter & Gamble. Ms. Rothstein currently serves on the boards of directors of Yelp Inc., InterContinental Hotels Group PLC and a number of privately-heldprivately held companies. She previously served on the board of directors of Afterpay Limited (“Afterpay”) from June 2020 until its acquisition by Block in 2022. Ms. Rothstein holds a Bachelor of Commerce from the University of British Columbia and an M.B.A. from the University of California, Los Angeles. Ms. Rothstein was appointed to our board of directors pursuant to the terms and conditions of Block’s acquisition of Afterpay Limited.Afterpay. She was selected to serve on our board of directors because of her marketing expertise and global operations experience. Dr. Lawrence Summers has served as a member of our board of directors since June 2011. Since January 2011, Dr. Summers has served as the Charles W. Eliot University Professor & President Emeritus of Harvard University and the Weil Director of the Mossaar-Rahmani Center for Business & Government at the Harvard Kennedy School. From January 2009 to December 2010, Dr. Summers served as Director of the National Economic Council for President Obama. Dr. Summers previously served as President of Harvard University, and he has also served in various other senior policy positions, including as Secretary of the Treasury and Vice President of Development Economics and Chief Economist of the World Bank. Dr. Summers previously served on the board of directors of LendingClub Corporation from December 2012 to June 2018, and currently serves as the Chairperson of the International Advisory Board at Santander Bank and on the boards of directors of Skillsoft Corp. and Doma Holdings, Inc., as well as several privately-heldprivately held companies. Dr. Summers holds a B.S. in Economics from Massachusetts Institute of Technology and a Ph.D. in Economics from Harvard University. Dr. Summers was selected to serve on our board of directors because of his extensive policy experience and in-depth knowledge of macroeconomic trends. Darren Walker has served as a member of our board of directors since June 2020. Since 2013, Mr. Walker has served as the President of the Ford Foundation, a philanthropic organization. From 2010 to 2013, he served as Vice President for Education, Creativity and Free Expression at the Ford Foundation. Prior to the Ford Foundation, Mr. Walker worked for the Rockefeller Foundation, a philanthropic organization, and served as a Vice President responsible for foundation initiatives from 2005 to 2010. Mr. Walker currently serves on the boards of directors of Ralph Lauren Corporation, PepsiCo, Inc. and on the boards of directors of several non-profit organizations, including the National Gallery of Art, Lincoln Center for the Performing Arts, Friends of the High | | | BLOCK 2022 Proxy Statement
| | | 4
|
TABLE OF CONTENTS
Line, the Smithsonian National Museum of African American History & Culture and Carnegie Hall. Mr. Walker is also a member of the Council on Foreign Relations and the American Academy of Arts and Sciences. Mr. Walker holds B.A., B.S. and J.D. degrees from the University of Texas at Austin.
| | |
| BLOCK 2023 Proxy Statement | 3 |
Mr. Walker was selected to serve on our board of directors because of his philanthropic experience and work around social justice, which is aligned with Block's purpose of economic empowerment. Jack Dorsey is our co-founder and has served as our principal executive officer and as a member of our board of directors since July 2009, having previously served as our Chief Executive Officer and President from July 2009 until his title changed to Block Head as of April 2022. Mr. Dorsey has served as Chairperson of our board of directors since October 2010. From May 2007 to October 2008, Mr. Dorsey served as President and Chief Executive Officer of Twitter, Inc. (“Twitter”). Mr. Dorsey returned to serve as Chief Executive Officer of Twitter from July 2015 until November 2021. He served as on the board of directors of Twitter from May 2007 to May 2022. Mr. Dorsey was selected to serve on our board of directors because of the perspective and experience he provides as one of our founders and our Block Head, as well as his extensive experience with technology companies and innovation. Paul Deighton has served as a member of our board of directors since May 2016. Mr. Deighton has served as the non-executive Chairperson of The Economist Group since July 2018 and of Heathrow Airport Holdings Limited, the owner of Heathrow Airport in the United Kingdom, since June 2016. From December 2012 to May 2015, Mr. Deighton served as Commercial Secretary to the Treasury and as a member of the House of Lords in the United Kingdom. Mr. Deighton previously served as the Chief Executive Officer of the London Organising Committee of the Olympic and Paralympic Games and held various roles at Goldman Sachs. Mr. Deighton serves as the non-executive Chairperson of Hakluyt Company Limited, an advisory firm. Mr. Deighton holds a B.A. in Economics from Trinity College, Cambridge University. Mr. Deighton was selected to serve on our board of directors because of his financial and business expertise, as well as his international perspective and his government and regulatory experience. Director Independence IndependenceOur Class A common stock is listed on the New York Stock Exchange.NYSE. Under theNYSE listing standards, of the New York Stock Exchange, independent directors must comprise a majority of a listed company’s board of directors. In addition, theNYSE listing standards of the New York Stock Exchange require that, subject to specified exceptions, each member of a listed company’s audit, compensation and nominating and corporate governance committees be independent. Under theNYSE listing standards, of the New York Stock Exchange, a director will only qualify as an “independent director” if, in the opinion of that listed company’s board of directors, that director does not have a material relationship with the company (either directly or as a partner, shareholder or officer of an organization that has a relationship with the company). As noted in the commentary to the listing standards, the concern is independence from management. Audit and risk committee members must also satisfy the additional independence criteria set forth in Rule 10A-3 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and theNYSE listing standards of the New York Stock Exchange.standards. Compensation committee members must also satisfy the additional independence criteria set forth in Rule 10C-1 under the Exchange Act and theNYSE listing standards of the New York Stock Exchange. standards.Our board of directors has undertaken a review of the independence of each of our directors. Based on information provided by each director concerning their background, employment and affiliations, our board of directors has determined that none of Mses. Brooks, Meeker and Rothstein,Rothstein; Messrs. Botha, Deighton, Garutti Viniar and Walker and Drs. Patterson andDr. Summers has a material relationship with the Company and that each of these current directors is “independent” as that term is defined under the applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) and theNYSE listing standards of the New York Stock Exchange.standards. In making the determination of the independence of our directors, the board of directors considered relevant transactions between Block and entities associated with our directors or members of their immediate families, including transactions involving Block and payments made to or from companies and entities in the ordinary course of business where our directors or members of their immediate families serve as partners, directors or as a member of the executive management of the other party to the transaction, and determined that none of these relationships constitute material relationships that would impair the independence of our directors. Board of Directors Leadership Structure and Role of Our Lead Independent Director Mr. Dorsey currently servesOur board of directors does not have a policy as to whether the roles of the Chairperson of our board of directors and as our Block Head.Head should be separate or combined. Our independentboard of directors bring experience, oversightbelieves that it should have the flexibility to make this determination as circumstances require and expertise from outsidein a manner that it believes is best to provide appropriate leadership for our company. Currently, Mr. Dorsey serves as both the Chairperson of our Company, while Mr. Dorsey brings current company-specific experience, leadershipboard of directors and insight.our principal executive officer. As our co-founder and Block
| | |
| BLOCK 2023 Proxy Statement | 4 |
Head, Mr. Dorsey is best positioned to identify and drive strategic priorities, oversee product development, identify key areas of risk for the company, lead critical discussions and execute our business plans. Our board of directors has adopted Corporate Governance Guidelines that provide that one of our independent directors should serve as our Lead Independent Director at any time when the Chairperson of our board of directors is not independent, including when our Block Head serves | | | BLOCK 2022 Proxy Statement
| | | 5
|
TABLE OF CONTENTS
as the Chairperson of our board of directors.independent. Because Mr. Dorsey is our Chairperson and is not an “independent” director as defined in theNYSE listing standards, of the New York Stock Exchange, our board of directors has appointed a Lead Independent Director. Mr. ViniarBotha, a director since 2011, has served as our Lead Independent Director since November 2015. In connection with Mr. Viniar’s decision to not stand for re-election at the Annual Meeting, the board appointed Mr. Botha as Lead Independent Director, effective at the Annual Meeting. Mr. Botha has served on the board of directors since January 2011.June 2022. As a seasoned director with extensive experience in the financial technology industry, heMr. Botha has played an essential role in advising our senior management in key strategic areas and has provided independent oversight in his roleroles as a member of both our audit and risk committee and our compensation committee, and our board of directors believes that he will beis a strong, independent and effective Lead Independent Director.
OurAs our Lead Independent Director, Mr. Botha is responsible for, among other things, responsible for the following: matters:•calling, determining the agenda for and serving as chairperson of meetings of independent directors and directors; •approving the agendas for regularly scheduled meetings of the board of directors meetings;and providing feedback on the board meeting schedule; •facilitating discussion and open dialogue among the independent directors both during board meetings, executive sessions and outside of board meetings;of directors’ meetings, including by presiding over executive sessions; •providing feedback to the Company’sour Block Head and Chairperson of theour board of directors regarding the executive sessions; •consulting with our Block Head on risk matters requiring the consideration of our board of directors; •serving as liaison between the Chairperson of our board of directors and theour independent directors, without inhibiting direct communication between them; •in consultation with our nominating and corporate governance committee, reviewing and reporting on the results of our board of directorsdirectors’ and its committees’ performance self-evaluations; •providing input on the composition of our board of directors; •serving as spokesperson for the Company as requested; and •performing such other responsibilities as may be designated by a majority of theour independent directors from time to time. We believe that theour leadership structure of Mr. Dorsey’s combined roleDorsey serving as both Chairperson of our board of directors and havingBlock Head, with a separate Lead Independent Director, is appropriate because it provides a balance between Mr. Dorsey’s company-specific experience, leadership and insight and our independent directors’ experience, leadership, oversight and expertise from outside of our company. This structure also enables strong leadership, creates clear accountability and enhances our ability to communicate our message and strategy clearly and consistently to stockholders while ensuring robust, independent oversight by theour board of directors and Lead Independent Director. Board of Directors Meetings, Attendance and Committees During our fiscal year ended December 31, 2021,2022, our board of directors held sixfour meetings (including regularly scheduled and special meetings), and each director attended at least 75% of the aggregate of (i) the total number of meetings of our board of directors held during the period for which they have beensuch director has served as a director and (ii) the total number of meetings held by all committees of our board of directors on which they havesuch director has served during the periods that they served. such director has served as a committee member.Although our Corporate Governance Guidelineswe do not have a formal policy regarding attendance by members of our board of directors at our annual meetingsmeeting of stockholders, we encourage, but do not require, our directors to attend. All of our directors who were serving as directors at the time attended our 20212022 annual meeting of stockholders. Our board of directors has established an audit and risk committee, a compensation committee and a nominating and corporate governance committee. The composition and responsibilities of each of the
| | |
| BLOCK 2022 2023 Proxy Statement | | | 6
5 |
TABLE OF CONTENTS
Table of the Contentscommittees of our board of directors is described below. Members will serve on these committees until their resignation or until otherwise determined by our board of directors. In addition to the responsibilities described below, each of the audit and risk committee, compensation committee and nominating and corporate governance committee provide oversight over the relevant activities of Square Financial Services, Inc. (“Square Financial Services”). Our audit and risk committee currently consists of Messrs. Botha, Deighton and ViniarWalker and Drs. Patterson andDr. Summers, with Mr. ViniarDeighton serving as Chair. Each of Mr. Viniar and Dr. Patterson will remain on the audit and risk committee until the Annual Meeting. Mr. Deighton will join the audit and risk committee and serve as Chair, effective at the Annual Meeting. Each of our current audit and risk committee members and Mr. Deighton meets the requirements for independence for audit committee members under theNYSE listing standards of the New York Stock Exchange and SEC rules and regulations. Each member of our audit and risk committee also meets the financial literacy and sophistication requirements of theNYSE listing standards of the New York Stock Exchange.standards. In addition, our board of directors has determined that each of Messrs. Botha Viniar and Deighton is an audit committee financial expert within the meaning of Item 407(d) of Regulation S-K under the Securities Act of 1933, as amended (“Regulation S-K”). Our audit and risk committee is, among other things,matters, responsible for the following: •selecting and hiring a qualified independent registered public accounting firm to audit our financial statements; •helping to ensure the independence and performance of the independent registered public accounting firm; •reviewing our financial statements and discussing the scope and results of the independent audit and quarterly reviews with the independent registered public accounting firm, and reviewing, with management and the independent registered public accounting firm, our interim and year-end results of operations and the reports and certifications regarding internal controls over financial reporting and disclosure controls; •preparing, reviewing and approving the audit and risk committee report that the SEC requires to be included in our annual proxy statement; •reviewing the adequacy and effectiveness of our disclosure controls and procedures, and developing procedures for employees to submit concerns anonymously about questionable accounting or audit matters; •reviewing and discussing with management our program and policies on risk assessment and risk management, including risks associated with data privacy and cybersecurity; •reviewing and overseeing related party transactions for which review or oversight is required by applicable law or required to be disclosed in our financial statements or SEC filings; and •approving or, as required, pre-approving, all audit and all permissible non-audit services and fees to be performed by the independent registered public accounting firm. Our audit and risk committee charter provides that, consistent with NYSE listing standards, no member of our audit and risk committee should simultaneously serve on the audit committees of more than two additional public companies unless our board of directors determines that such simultaneous service would not impair the ability of such member to effectively serve on our audit and risk committee and we disclose such determination. Our board of directors has considered Mr. Botha’s simultaneous service on the audit committees of three additional public companies and has determined that such simultaneous service does not impair his ability to effectively serve as a member of our audit and risk committee. We believe that Mr. Botha's financial and managerial experience continue to provide valuable insight. Our audit and risk committee operates under a written charter that satisfies the applicable rules and regulations of the SEC and theNYSE listing standards of the New York Stock Exchange.standards. A | | | BLOCK 2022 Proxy Statement
| | | 7
|
TABLE OF CONTENTS
copy of the charter of our audit and risk committee is available on our investor relations website at https://investors.block.xyz.investors.block.xyz. Information on or accessible through our website is not incorporated by reference in this proxy statement. During 2021,2022, our audit and risk committee held fivenine meetings.
| | |
| BLOCK 2023 Proxy Statement | 6 |
Compensation Committee Our compensation committee consists of Mses. Meeker and Rothstein and Messrs. Botha and Deighton, with Ms. Meeker serving as Chair. Ms. Rothstein was appointed to the compensation committee effective April 20, 2022. Each of our compensation committee members meets the requirements for independence for compensation committee members under theNYSE listing standards of the New York Stock Exchange and SEC rules and regulations, including Rule 10C-1 under the Exchange Act. Each of Mses. Meeker and Rothstein and Mr.Messrs. Botha and Deighton is also a “non-employee director,” as defined pursuant to Rule 16b-3 promulgated under the Exchange Act. Our compensation committee is, among other things,matters, responsible for the following: •reviewing approving and determining,approving, or making recommendations to our board of directors regarding, the compensation of our Section 16 executive officers; •overseeing our overall compensation philosophy and compensation policies, plans and benefits programs, including those for our executiveSection 16 officers; administering our equity compensation plans; and
reviewing, approving•evaluating and making recommendations to our board of directors regarding incentivethe compensation of our directors; and •administering our equity compensation plans. Our compensation committee operates under a written charter that satisfies the applicable rules and regulations of the SEC and theNYSE listing standards of the New York Stock Exchange.standards. A copy of the charter of our compensation committee is available on our investor relations website at https://investors.block.xyz.investors.block.xyz. During 2021,2022, our compensation committee held five meetings. Our compensation committee may delegate its authority and duties to subcommittees or individuals as it deems appropriate and in accordance with applicable laws and regulations. Our compensation committee has delegated authority to our management equity committee, which during 20212022 consisted of our Block Head and People Lead, to make equity grants within predetermined guidelines to employees and consultants who are not our Section 16 officers or members of our management equity committee. In addition, our compensation committee may establish, and has in the past established, a subcommittee comprised entirely of members of the compensation committee that meet the requirements of a “non-employee director,” as such term is used at the beginning of this section. This subcommitteeMses. Meeker and Rothstein and Mr. Deighton, which has the nonexclusive authority to grant equity and other awards under our compensation plans, including, if applicable, awards that comply with Section 16 of the Exchange Act, to the extent applicable. including Rule 16b-3 thereunder.Nominating and Corporate Governance Committee Our nominating and corporate governance committee currently consists of Ms. Brooks and Messrs. Garutti Viniar and Walker, with Mr. Garutti serving as Chair. Mr. Viniar will remain on the nominating and corporate governance committee until the Annual Meeting. Each of our nominating and corporate governance committee members meets the requirements for independence under theNYSE listing standards of the New York Stock Exchange and SEC rules and regulations. Our nominating and corporate governance committee is, among other things,matters, responsible for the following: •identifying, evaluating and making recommendations to our board of directors regarding nominees for election to our board of directors and its committees; | | | BLOCK 2022 Proxy Statement
| | | 8
|
TABLE OF CONTENTS
•evaluating the performance of our board of directors, individual directors and our Block Head; •considering and making recommendations to our board of directors regarding the composition of our board of directors and its committees; overseeing, •reviewing and making recommendations to our board of directors regarding our corporate governance practices, including our Corporate Governance Guidelines;Guidelines and our Code of Business Conduct and Ethics; •overseeing the Company’sour process for stockholder communications with the board of directors; •overseeing our commitment to inclusion and diversity (“I&D”), including our I&D policies and programs, and conducting a periodic review of our I&D efforts with our People Lead and Inclusion and Diversity Lead; providing oversight•conducting periodic reviews of our commitment to environmental, social, and governance (“ESG”) programming and corporate responsibility initiatives, with periodic reviewinitiatives;
| | |
| BLOCK 2023 Proxy Statement | 7 |
Contents•reviewing and monitoring compliance with our Code of Business Conduct and Ethics and other actual and potential conflicts of interest of our board of directors and corporate officers, other than transactions with related parties reviewed by the audit and risk committee; and •reviewing the succession planning for our Block Head, as well as each of our other members of our executive management team. Our nominating and corporate governance committee operates under a written charter that satisfies the applicable NYSE listing standards of the New York Stock Exchange.standards. A copy of the charter of our nominating and corporate governance committee is available on our investor relations website at https://investors.block.xyz.investors.block.xyz. During 2021,2022, our nominating and corporate governance committee held four meetings. CompensationCompensation Committee Interlocks and Insider Participation None of the current members of our compensation committee, or any member that served during the past fiscal year, is or has been an officer or employee of our Company.company, or had any relationship requiring disclosure under Item 404 of Regulation S-K. None of our executive officers currently serves, or in the past fiscal year has served, as a member of the board of directors or compensation committee (or other board committee performing equivalent functions) of any entity that has one or more of its executive officers serving on our compensation committee. None of our executive officers currently serves, or in the past fiscal year has served, as a member of the compensation committee (or other board committee performing equivalent functions) of any entity that has one or more of its executive officers serving on our board of directors. ConsiderationsConsiderations in Evaluating Director Nominees Our nominating and corporate governance committee uses a variety of methods for identifying and evaluating director nominees, includingwhich may include reviewing candidates whom our stockholders have properly submitted for recommendation or retaining a third-party executive search firm from time to time to identify and review candidatescandidates. We maintain policies and procedures for membership on our board of directors. In its evaluation of director candidates, which require our nominating and corporate governance committee will | | | BLOCK 2022 Proxy Statement
| | | 9
|
TABLE OF CONTENTS
considerto evaluate director candidates in light of the current size and composition, organization and governance of our board of directors and the needs of our board of directors and its committees. There is no difference in the respective committeesevaluation process of our boarda director candidate recommended by a stockholder as compared to the evaluation process of directors.a candidate identified by any other means. Some of the qualifications that our nominating and corporate governance committee considers include, without limitation:
•Issues of character,Character, integrity and judgment:judgment: Nominees must have the highest personal and professional ethics.
•Diversity:Diversity: Although our board of directors does not have specific requirements with respect to board diversity, it believes that our board should be diverse, including with respect to factors such as gender, race, ethnicity and experience. Further, our nominating and corporate governance committee has adopted a practice for open director positions whichthat is similar to our RISE (Remarkable Interview Slate Enforcement) program, which we use for employee recruiting. RISE aims at ensuring we are consistently considering diverse slates of candidates by committing to interviewing at least one underrepresented minority or woman of any race/ethnicity for open positions in the U.S.
•Area of expertise:expertise: Nominees must also have the ability to offer advice and guidance to our Block Head and other members of management based on proven achievement and leadershipexpertise in the companies or institutions with which they are, or have been, affiliated.their fields. •Potential conflicts of interest and other commitments: Director candidatescommitments: Nominees must understand the fiduciary responsibilities that are required of a member of our board of directors and have sufficient time available in the judgment of our nominating and corporate governance committee to perform all board of director and committee responsibilities. Members of our board of directors are expected to prepare for, attend and participate in all board of director and applicable committeedirectors' meetings. •Other individual qualities and attributes:attributes: Our nominating and corporate governance committee may also consider such other factors as it may deem, from time to time, areto be in our and our stockholders’ best interests. After completing its review and evaluation of director candidates, our nominating and corporate governance committee recommends to our full board of directors the director nominees for selection. While
| | |
| BLOCK 2023 Proxy Statement | 8 |
factors relating to diversity were considered for our current directors, no single factor was determinative with respect to any of our current directors. | | | BLOCK 2022 Proxy Statement
| | | 10
|
TABLE OF CONTENTS
Stockholder
Stockholder Recommendations and Nominations to theour Board of Directors Our nominating and corporate governance committee will consider director candidates recommended by stockholders holding the lesser of: (i) $2,000 in market value or (ii) one percent (1%) on a fully diluted basis of the Company’s securities continuously for at least twelve (12) months prior to the date of the submission of the recommendation, so long as such recommendations comply with our amended and restated certificate of incorporation, our amended and restated bylaws and any applicable laws, rules and regulations, including those promulgated by the SEC. Our nominating and corporate governance committee will evaluate such recommendations in accordance with its charter, our amended and restated bylaws and our policies and procedures for director candidates, as well as the director nominee criteria described above that is applicable to all director candidates. This process is designed to ensure that our board of directors includes members with diverse backgrounds, skills and experience, including appropriate financial and other expertise relevant to our business. Eligible stockholders wishing tomay recommend a candidate for nomination should contactby submitting the recommendation in writing to our Chief Legal OfficerCorporate Secretary or legal department in writing.at Block, Inc., 1955 Broadway, Suite 600, Oakland, CA 94612. Such recommendationsrecommendation must include information about the candidate, a statement of support by the recommending stockholder, evidence of the recommending stockholder’s ownership of our capital stock and a signed letter from the candidate confirming willingness to serve on our board of directors and any additional information required by our amended and restated bylaws.directors. Our nominating and corporate governance committee has discretion to decide which individuals to recommend for nomination as directors. Under our amended and restated bylaws, stockholders may also directly nominate persons for our board of directors. Any nomination must comply with the requirements set forth in our amended and restated bylaws and should be sent in writing to our Corporate Secretary at Block, Inc., 1455 Market Street,1955 Broadway, Suite 600, San Francisco, California 94103.Oakland, CA 94612. To be timely for the 2023our 2024 annual meeting of stockholders, our Corporate Secretary must receive the nomination no earlier than the close of business on February 14, 20232024 and no later than the close of business on March 16, 2023,15, 2024, or in the event that we hold the 2023our 2024 annual meeting of stockholders more than 30 days before or more than 60 days after the one-year anniversary of the Annual Meeting, no earlier than the close of business on the 120th day before the 2023our 2024 annual meeting of stockholders and no later than the close of business on the later of either (i) the 90th day prior to the 2023our 2024 annual meeting of stockholders or (ii) the 10th day following the day on which public announcement of the date of the 2023our 2024 annual meeting of stockholders is first made if such first public announcement is less than 100 days prior to the date of the 2023our 2024 annual meeting of stockholders. Communications Any notice of director nomination submitted must include the additional information required by Rule 14a-19(b) under the Exchange Act.Communications with theNon-Management Members of Our Board of Directors Interested parties wishing to communicate with our board of directors or with an individual member ornon-management members of our board of directors may do so by writing to our board of directors or to the particular non-management member or members of our board of directors, and mailing the correspondence via registered or overnight mail to our Chief Legal OfficerCorporate Secretary at Block, Inc., 1455 Market Street,1955 Broadway, Suite 600, San Francisco, California 94103.Oakland, CA 94612. Each communication should set forth (i) the name and address of the stockholder, asinterested party (as it appears on our books, if applicable) and if the shares of our common stock are held by a nominee, the name and address of the beneficial owner of such shares, and (ii) the class and number of shares of our common stock that are owned of record by the record holder and beneficially by the beneficial owner.
| | |
| BLOCK 2023 Proxy Statement | 9 |
Our Chief Legal OfficerCorporate Secretary or legal department, in consultation with appropriate members of our board of directors as necessary, will review all incoming communications and, if appropriate, forward such communications will be forwarded to the appropriate non-management member or members of our board of directors, or if none is specified, to the Chairperson of our board of directors or the Lead Independent Director if the Chairperson of our board of directors is not independent. | | | BLOCK 2022 Proxy Statement
| | | 11
|
TABLE OF CONTENTS
Corporate Governance Guidelines and Code of Business Conduct and Ethics Our board of directors has adopted Corporate Governance Guidelines that address items such as the qualifications and responsibilities of our directors and director candidates including independence standards and corporate governance policies and standards applicable to us in general.the responsibilities of members of committees of our board of directors. In addition, our board of directors has adopted a Code of Business Conduct and Ethics that applies to all of our employees, officers and directors, including our Block Head, Chief Financial Officer and other executive and senior financial officers. The full texttexts of our Corporate Governance Guidelines and our Code of Business Conduct and Ethics isare posted on our investor relations website at https://investors.block.xyz.investors.block.xyz. We will post amendments to our Corporate Governance Guidelines and our Code of Business Conduct and Ethics orand any waivers of our Code of Business Conduct and Ethics for directors and executive officers on the same website. ManagementOur board of directors recognizes the oversight of risk management as one of its primary responsibilities and central to maintaining an effective, risk awarerisk-aware and accountable organization. The oversight responsibility of our board of directors and its committees is enabledsupported by management reporting processes that are designed to provide visibility to our board of directors regarding the identification, assessment and management of risks and management’s strategic approach to risk mitigation. Our Lead Independent Director and Chair of our audit and risk committee meetsmeet with our Internal Audit Lead, Chief Financial Officer, Chief Compliance Officer and Chief Legal Officer on a regular cadence to identify and discuss risks and exposures, and escalatesescalate potential issues to our audit and risk committee or board of directors, as appropriate. As part of our overall risk management process, we conduct an annual Enterprise Risk Assessment (“ERA”) on an annual basis,, which is shared and discussed with our board of directors. The oversightOversight of the ERA is supported and enabled by our audit and risk committee. In addition, ourOur board of directors’ responsibilities related to oversight of the ERA framework includeincludes a routine evaluation, of the processes, as well aswith discussions with key management and representatives of outside advisors, as appropriate, of the processes used to identify, assess, monitor and report on risks across the organization and the setting and communication of the organization���sorganization’s implementation and measurement of risk tolerances, limits and mitigation. These primary risk focus areas are defined by theOur board of directors, management and functional leaders of our ERA review asdefine our primary risk focus area for review. These areas include strategic, operational, people, financial and compliance and consist ofcompliance. We address risks such as cybersecurity, financial reporting and competition. competition within each of these areas.While our board of directors maintains ultimate responsibility for the oversight of risk, it has implemented a multi-layered approach whichthat delegates certain responsibilities to the appropriate board committees to ensure that these primary areas of focus are thoroughly discussed in detail and that a pervasivefull understanding of such focus areasthe applicable risk is obtained. Our board of directors and its committees oversee risks associated with their respective areas of responsibility, as summarized below. Each board committee meets in executive session with key management personnel and representatives of outside advisors as required or requested. Our board of directors may delegate additional risk areas to its committees in the future.
Board/
Committee
| | | Board of Directors / Committee | | Primary Areas of Risk Oversight |
| | |
| | | | Strategic, financial and execution risks and exposures associated with our business strategy, policy matters, succession planning, conflicts of interest, significant litigation and regulatory exposures and other current matters that may present material risk to our |
| | | BLOCK 2022 Proxy Statement
| | | 12
|
TABLE OF CONTENTS
| | | financial performance, operations, infrastructure, plans, prospects or reputation, acquisitions and divestitures and our operational infrastructure. |
| |
|
| | | | BLOCK 2023 Proxy Statement | 10 |
| | | Audit and Risk Committee | | | Risks and exposures associated with financial matters, particularly financial reporting, tax, accounting, disclosure controls and procedures, internal control over financial reporting, investment guidelines and credit and liquidity matters, our programs and policies relating to legal and regulatory compliance, data privacy, data security, cybersecurity and operational security and reliability, as well as matters of risk related to Square Financial Services. |
| | |
| Nominating and Corporate Governance Committee | | | Risks and exposures associated with director and executive succession planning,planning; conflicts of interest; environmental, social, corporate governance, inclusion and diversity, and corporate responsibility mattersmatters; and overall board and committee effectiveness and composition. composition, as well as governance related matters related to Square Financial Services. |
| | |
| | | | Risks and exposures associated with leadership assessment, retention and succession, executive compensation programs and arrangements and our compensation philosophy and practices. |
Board’s Role in Data Privacy and Cybersecurity Oversight Our board of directors is committed to mitigating data privacy and cybersecurity risks and recognizes the importance of these issues as part of our risk management framework. While the board of directors maintains ultimate responsibility for the oversight of our data privacy and cybersecurity program and risks, it has delegated certain responsibilities to our audit and risk committee. This committee-level focus on data privacy and cybersecurity allows the board to further enhance its understanding of these issues. The audit and risk committee assists the board of directors in its oversight of our data privacy and cybersecurity needs by staying apprised of our data privacy and information security programs, strategy, policies, standards, architecture, processes and material risks, and overseeing responses to security and data incidents. Our board of directors and audit and risk committee’s principal role is one of oversight, recognizing that management is responsible for the design, implementation and maintenance of an effective program for protecting against and mitigating data privacy and cybersecurity risks. The full board of directors undergoes annual information security and privacy training by our Chief Information Security Officer and our Chief Privacy Officer, which covers, among other matters, board oversight obligations and the privacy and security programs in place at Block. Our audit and risk committee receives updates, at least quarterly, on material data privacy and security risks, including any material incidents, relevant industry developments, threat vectors and material risks identified in periodic penetration tests or vulnerability scans. The committee’s updates also include material legal and legislative developments concerning data privacy and security, Block’s approach to complying with applicable law and material engagement with regulators concerning data privacy and cybersecurity. Members of the board of directors stay apprised of the rapidly evolving cyber threat landscape and provide guidance to management as appropriate in order to address the effectiveness of our overall data privacy and cybersecurity program. | | | BLOCK 2022 Proxy Statement
| | | 13
|
TABLE OF CONTENTS
ESG and Corporate Responsibility Our nominating and corporate governance committee oversees Block’sour corporate responsibility initiatives. We believe that as a company with a diverse ecosystem of products and services, Block has a tremendous opportunity to empower businesses, artists, and individuals to participate in the economy, as well as to operate a responsible and sustainable business while fostering an inclusive environment for its employees, customers, communities and shareholders. We are committed to managing the risks and opportunities that arise from ESG issues and maintaining our strong focus on sustainability. During 2021,2022 and early 2023, we met with eleven of our topseveral investors to review Block’sour ESG initiatives. We discussed a wide variety of topics, including progress tracking of initiatives, metrics disclosure, how investors useinvestor usage of third-party ESG ratings, incentive compensation, data security and privacy, our governance structure and board refreshment. Block takesWe take an integrated approach to managing ESG performance and disclosure: •Functional Leadership:Leadership: Corporate responsibility is managed at a functional level across each of Block’sour teams, with responsibility for oversight rolling up to our senior executives.
| | |
| BLOCK 2023 Proxy Statement | 11 |
•Operational Leadership: Block hasLeadership: We have formed a cross-functional working group from multiple business areas that serves as the central coordinating body for Block’sour corporate responsibility efforts. This team is led by an ESG Lead who oversees the broader ESG program, connects our key stakeholders, across the Company, and reports up to senior leadership and the nominating and corporate governance committee. •Board Oversight:Oversight: Our nominating and corporate governance committee is responsible for overseeing ESG and corporate responsibility matters of significance to Blockus and receives periodicquarterly reports on these matters from our ESG Lead. The nominating and corporate governance committee also receives periodic I&Dquarterly Inclusion and Diversity reports from our People Lead and Inclusion and Diversity Lead. •Corporate Social Responsibility Report:Report: In March 2022,2023, we released our 20212022 Corporate Social Responsibility Report (“CSR Report”), which was prepared to highlight information regarding our ESG programs. The CSR Report provides an overview of Block’sour global operations with a focus on the four key priority areas discussed below. Our CSR Report can be found on our investor relations website at https://investors.block.xyz.investors.block.xyz.
Key areas of focus for Block’sour ESG strategy are: •Financial Inclusion: We continue to make progress on our 2020 commitment to invest $100 million in minority and underserved communities to further our purpose of economic empowerment, including with our racial equity investment program. We hope this program can serve as a model for other organizations interested in making similar commitments. As of December 31, 2022, we have invested $32 million in aggregate toward this initiative, with each organization receiving funds hand-selected by a cross-functional team of our employees. In 2022, as part of our racial equity investment program, we became the first private investor in Canada’s Indigenous Growth Fund (“IGF”), Canada’s largest Indigenous social impact fund. We plan to invest up to $3 million CAD in the IGF, which improves access to capital for Indigenous entrepreneurs who want to start or grow their businesses. We share the National Aboriginal Capital Corporations Association’s vision to accelerate the speed and scale of the return to Indigenous prosperity through the first-of-its-kind Indigenous Growth Fund. •Climate Action:Action: In 2022, we continued to scale our climate action program. We expanded our carbon removal portfolio, drove internal carbon emission reductions and increased our climate risk and opportunity disclosures through the Carbon Disclosure Project (“CDP”), Science-Based Targets and Sustainability Accounting Standards Board (“SASB”). We continue to plan for increased efficiencies across our entire value chain. To strengthen this ongoing effort, in 2021In 2022, we conducted our yearly comprehensive global carbon audit across our business units, supply chain and key emission categories, providing us with data to drive meaningful reductionsaid us in our internal emissions while informing our goal to reachof reaching net zero carbon for operations by 2030. 2021 marked •Inclusion and Diversity: We believe equity and access are essential to economic empowerment. Inclusion and diversity are at the heart of the workplace we are building. We continue to provide transparency regarding the diversity of our climate action program’s first full year of implementation. Withinworkforce, including sharing our first year, we funded our first carbon removal portfolio, secured our first renewable energy certificates to address our workplace footprint and announced our first bitcoin clean energy investment to help accelerate the adoption of clean energy in bitcoin mining. To provide greater transparency, we also submittedEEO-1 consolidated report for the first time in 2022. Our continuing efforts to celebrate diversity and operate with fairness and equity include: dedicating resources to our climate risk14 employee resources groups, now with 50+ chapters globally; embedding checks and opportunity dataanalyses within our systems to the Carbon Disclosure Project (CDP) as well ascombat bias and advance fairness in promotion and compensation; embedding an inclusion analysis within our twice-annual employee engagement survey; setting a baseline for candidate slate diversity to the Sustainability Accounting Standards Board (SASB). Social Impact: We are continuing to drive financial inclusionensure we consistently consider slates inclusive of talent from underrepresented backgrounds; and community and small business advocacy. In 2020, we pledged $100 million towards minority and underserved communities, of which $75 million was allocated in 2020, and in continuation of that, in 2021 we allocated the remaining $25 million of this investment. This includes a $10 million
| | | BLOCK 2022 Proxy Statement
| | | 14
|
TABLE OF CONTENTS
investment in the Entrepreneurs of Color Fund, a program designed to provide much-needed capital and operational support directly into the hands of Black, Latinx and other small business owners, and another $10 million allocation to various organizations dedicated to underserved communities. We also committed to $5 million in grants from our new Bitcoin Endowment, which selected Black Bitcoin Billionaire, an organization working to on-ramp the Black community into bitcoin and create education focused on building wealth, as its first recipient. During 2021, we continued to provide small businessespartnering with access to capital by facilitating a total of 72,500 second round Paycheck Protection Program (PPP) loans as our sellers continue to navigate through the impacts of COVID-19. Cash App was also well positioned to help individuals efficiently access, deposit and use stimulus funds distributed by the government.
Employees and Culture: We are working to build a thriving, inclusive and healthy workplace. As reported in our 2021 Workforce Data Report on our I&D blog, Block employees were 42% women and 24% underrepresented minorities (“URM”). In an effort to meet our aspirational benchmark target of 50% women and 30% URM, which is on par with U.S. census data, we are continuing to implement meaningful programming and deepening our partnerships with organizationsgroups such as AfroTech, Lesbians WhoTechWho Tech, Techqueria, and Allies, /dev/color, SocietyMcKinsey Black and Hispanic Leadership Academies to build relationships with and invest in the development of Hispanic Professional Engineers, Rewriting the Code, American Indian Science Engineering Society and a number of Historically Black Colleges and Universities.talent from underrepresented backgrounds.
•Corporate Governance:Governance: In 2021,2022, we continued corporate governance practices that we believe promote long-term value, engender public trust and serve the best interest of our stockholders, sellers, customers and other stakeholders. Some highlights of our corporate governance practices are our robust director succession planning process; our lead independent director role withwho has a comprehensive scope of responsibilities,responsibilities; a board of directors that is comprised of a majority of independent directors with a wide range of expertise, annual review of our corporate governance policies and charters,charters; robust process for developing a pipeline for potential director candidates,candidates; strong risk oversight controls by the full board and committeescommittees; annual Board, committee, and individual
| | |
| BLOCK 2023 Proxy Statement | 12 |
director self-assessments and significant stock ownership requirements for directors and executive officers. During 2021, we also made changes to our corporate governance policies and practices, which included, among other things, requiring that our Lead Independent Director approves agendas for regularly scheduled board meetings and limiting the number of public company boards directors who serve as chief executive officers of public companies can serve on to a total of three public company boards, including Block’s, unless they receive approval from our board of directors. CompensationPursuant to our Outside Director Compensation Policy, our non-employee directors will receive compensation in the form of equity granted under the terms of our 2015 Equity Incentive Plan, as amended and restated (the “2015 Plan”), and cash, as described below. Our 2015 Plan contains maximum limits on the size of the equity awards that can be granted to each of our non-employee directors in any fiscal year, but those maximum limits do not reflect the intended size of any potential grants or a commitment to make any equity award grants to our non-employee directors in the future. The only commitment to make equity award grants to our non-employee directors is under our Outside Director Compensation Policy, as it may be amended from time to time. The maximum limits under our 2015 Plan provide that no non-employee director may be granted, in any fiscal year, equity awards having a grant date fair value (determined in accordance with generally accepted accounting principles (“GAAP”)) of more than $1 million, provided that the limit is $2 million in connection with the director’s initial service as a non-employee director. Equity awards granted to an individual while they were an employee or a consultant, but not a non-employee director, do not count for purposes of these limits. | | | BLOCK 2022 Proxy Statement
| | | 15
|
TABLE OF CONTENTS
Our compensation committee periodically reviews our Outside Director Compensation Policy, including review of competitive practices provided by Compensia, Inc., an independent compensation consulting firm engaged by our compensation committee (“Compensia”). In 2021,2022, based on data provided by Compensia, our average total direct compensation per director (including annual cash retainer and equity awards) approximated the 28th10th percentile amongst our compensation peer group identified below in the section titled “Executiveentitled “Executive Compensation—Compensation-Setting Process—Competitive Positioning.Positioning.” Initial Award. Subject to any limits in our 2015 Plan, each person who first becomes a non-employee director will receive an initial grant of restricted stock units (“RSUs”) on the date of their appointment having a grant date fair value (determined in accordance with GAAP) equal to $250,000 multiplied by a fractionfraction: (i) the numerator of which is (x) 12 minus (y) the number of months between the date of the last annual meeting of stockholders and the date the non-employee director becomes a member of our board of directors and (ii) the denominator of which is 12. However, if a person first becomes a non-employee director on the day of an annual meeting of stockholders, they will only receive an annual award (described below) on such date, but will not receive an initial award. The shares of our Class A common stock underlying the RSUs vest in full upon the earlier of (i) the first anniversary of the grant date or (ii) the date of the next annual meeting of stockholders, in each case subject to continued service through the vesting date. If the appointment date is the same as the date of annual meeting, then such outside director will only be granted an annual award.Annual Award. On the date of each annual meeting of stockholders, and subject to any limits in our 2015 Plan, each of our non-employee directors is granted RSUs having a grant date fair value (determined in accordance with GAAP) equal to $250,000. The shares of our Class A common stock underlying the RSUs vest in full upon the earlier of (i) the first anniversary of the grant date or (ii) on the date of the next annual meeting of stockholders, in each case subject to continued service through the vesting date. Our Lead Independent Director receives an annual grant of RSUs, in addition to the annual grant provided to all non-employee directors, on the date of each annual meeting of stockholders having a grant date fair value (determined in accordance with GAAP) of $70,000, subject to any limits in our 2015 Plan. The shares of our Class A common stock underlying the RSUs vest in full upon the earlier of (i) the first anniversary of the grant date or (ii) the date of the next annual meeting of stockholders, in each case subject to continued service through the vesting date. The awards granted to a non-employee director under our Outside Director Compensation Policy will become fully vested upon a “change in control” as defined in our 2015 Plan.
| | |
| BLOCK 2023 Proxy Statement | 13 |
Cash Compensation. Each of our non-employee directors receives an annual cash retainer of $40,000 for serving on our board of directors. In addition, each year, non-employee directors are eligible to receive the following cash fees for service on the committees of our board of directors. Audit and Risk Committee | | | $20,000 | | | $10,000 | Compensation Committee | | | $15,000 | | | $5,000 | Nominating and Corporate Governance Committee | | | $10,000 | | | $2,500 | Capital Compliance and Governance Committee(1) | | | $15,000 | | | $5,000 |
(1)
| Our board of directors dissolved the capital compliance and governance committee in April 2021; accordingly, committee members were paid a prorated fee for their service in 2021. |
| | | BLOCK 2022 Proxy Statement
| | | 16
|
TABLE OF CONTENTS
| | | | | | | | | Board Committee | | Chair Fee | | | Member Fee | | Audit and Risk Committee | | $ | 20,000 | | | $ | 10,000 | | Compensation Committee | | $ | 15,000 | | | $ | 5,000 | | Nominating and Corporate Governance Committee | | $ | 10,000 | | | $ | 2,500 | |
Subject to any limits under our 2015 Plan, each non-employee director may elect to convert any cash compensation that they would otherwise be entitled to receive under our Outside Director Compensation Policy into an award of RSUs under our 2015 Plan. If the non-employee director makes this election in accordance with the policy, each such award of RSUs will be granted on the first business day following the last day of the fiscal quarter for which the cash compensation otherwise would be paid under the policy, will be fully vested on the grant date, and will cover a number of shares equal to (A) the aggregate amount of cash compensation otherwise payable to the non-employee director on that date divided by (B) the closing price per share as of the last day of the fiscal quarter for which the grant relates. The following table provides information regarding the total compensation that was earned by each of our non-employee directors in 2021.
2022. Mr. Viniar and Dr. Patterson served as directors until our 2022 annual meeting of stockholders in June 2022.The amounts under the “Stock Awards” column represent the aggregate of initial or annual equity compensation provided under the Outside Director Compensation Policy, and equity grants made in lieu of cash compensation, each as detailed in footnotes 2 and 3, respectively. The aggregate number of stock awards and option awards outstanding at December 31, 20212022 are included in footnotes 3 and 6footnote 2 below. Roelof Botha | | | — | | | 304,729 | | | — | | | 304,729 | Amy Brooks | | | — | | | 291,943 | | | — | | | 291,943 | Shawn Carter | | | — | | | 286,527 | | | — | | | 286,527 | Paul Deighton | | | 49,904 | | | 249,842 | | | 3,263(4) | | | 303,009 | Randy Garutti | | | 50,000 | | | 249,842 | | | — | | | 299,842 | James McKelvey | | | — | | | 289,619 | | | — | | | 289,619 | Mary Meeker | | | — | | | 304,729 | | | — | | | 304,729 | Anna Patterson | | | — | | | 302,565 | | | — | | | 302,565 | Sharon Rothstein(5) | | | — | | | — | | | — | | | — | Lawrence Summers | | | 50,000 | | | 249,842 | | | — | | | 299,842 | David Viniar(6) | | | — | | | 382,102 | | | — | | | 382,102 | Darren Walker | | | — | | | 295,131 | | | — | | | 295,131 |
| | | | | | | | | | | | | | | | | Director | | Fees Earned or Paid in Cash ($) | | | Stock Awards ($)⁽¹⁾⁽²⁾⁽³⁾ | | | All Other Compensation ($) | | | Total ($) | | Roelof Botha | | | — | | | | 375,524 | | | | — | | | | 375,524 | | Amy Brooks | | | — | | | | 292,784 | | | | — | | | | 292,784 | | Shawn Carter | | | — | | | | 290,152 | | | | — | | | | 290,152 | | Paul Deighton | | | 50,934 | | | | 249,944 | | | | — | | | | 300,878 | | Randy Garutti | | | 50,000 | | | | 249,944 | | | | — | | | | 299,944 | | James McKelvey | | | — | | | | 290,152 | | | | — | | | | 290,152 | | Mary Meeker | | | — | | | | 305,576 | | | | — | | | | 305,576 | | Anna Patterson | | | — | | | | 35,595 | | | | — | | | | 35,595 | | Sharon Rothstein | | | 28,906 | | | | 333,223 | | | | — | | | | 362,129 | | Lawrence Summers | | | 50,000 | | | | 249,944 | | | | — | | | | 299,944 | | David Viniar | | | — | | | | 44,468 | | | | — | | | | 44,468 | | Darren Walker | | | — | | | | 292,784 | | | | — | | | | 292,784 | |
(1)The amounts included in the “Stock Awards” column represent the aggregate grant date fair value of RSU awards calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC 718”). The amount does not necessarily correspond to the actual value recognized by the non-employee director. The valuation assumptions used in determining such amounts are described in the section entitled “Share-based Compensation” of Note 17, Stockholders' Equity in the “Stock Awards” column represent the aggregate grant date fair value of RSU awards calculated in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (“ASC 718”). The amount does not necessarily correspond to the actual value recognized by the non-employee director. The valuation assumptions used in determining such amounts are described in the “Share-based Compensation” section of and the Notes to the Consolidated Financial Statements included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022. (2)The amounts included in the “Stock Awards” column represent the annual awards or initial awards of RSUs, as applicable, granted to our non-employee directors in 2022. Each of our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. |