☐ | 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 |
☒ | 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)(1) and 0-11 |
Notice of Annual
Meeting of Shareholders
How to vote
Online | Phone | In person
|
Shareholders as of the close of business on March 14, 2022,13, 2023, the record date, may vote at the meeting.
If you are a registered shareholder or Verizon savings plan participant, you may vote online at www.envisionreports.com/vz, by telephone or by mailing a proxy card. YouRegistered shareholders may also vote in person at the annual meeting. If you hold your shares through a bank, broker or other institution, you will receive a voting instruction form that explains the various ways you can vote. We encourage you to vote your shares as soon as possible.
Advance registration is required to attend the meeting in person. Admission, voting and additional meeting information can be found beginning on page 6676 of the proxy statement.
March 28, 202227, 2023
By Order of the Board of Directors,
William L. Horton, Jr.
Senior Vice President, Deputy General Counsel
and Corporate Secretary
Verizon Communications Inc.
1095 Avenue of the Americas
New York, New York 10036
Important Notice Regarding Availability of Proxy Materials for Verizon’s Shareholder Meeting to be Held on May 12, 202211, 2023
The 20222023 Proxy Statement and 20212022 Annual Report on Form 10-K are available at www.edocumentview.com/vz.
We are making the proxy materials first available on or about March 28, 2022.27, 2023.
Date and time
Thursday, May 12, 202211, 2023
8:45 AM, local time
Place
Salt Lake City Marriott Dallas Las ColinasUniversity Park
223 West Las Colinas Boulevard480 Wakara Way
Irving, Texas 75039Salt Lake City, Utah 84108
Items of business
Elect the 1112 Directors identified in the accompanying proxy statement
Approve, on an advisory basis, Verizon’s executive compensation
Vote, on an advisory basis, on the frequency of future advisory votes related to Verizon’s executive compensation
Ratify the appointment of the independent registered public accounting firm
Act on the shareholder proposals described in the proxy statement that are properly presented at the meeting
Consider any other business that is properly brought before the meeting
The Verizon Board
From left to right: | ||||||||||||
Clarence Otis, Jr. | Daniel Schulman | Hans Vestberg | Rodney Slater | |||||||||
Carol Tomé | Shellye Archambeau | Vittorio Colao | Melanie Healey | |||||||||
Gregory Weaver | Laxman Narasimhan | Mark Bertolini | Roxanne Austin |
To our shareholders:
A message from Hans Vestberg, our Chair & CEO, and Clarence Otis, Jr., our Lead Director
Verizon’s
Our Corporate Governance and Policy Committee regularly evaluates the contribution of each of our Directors to our Board, including their availability to undertake the duties of Board and committee membership, their meeting attendance, their independence, and whether a Director’s skills and expertise continue to align with Verizon’s long-term business strategy. We look forward to continuing our success in building the Board |
|
Delivering on our corporate purpose and capitalizing on the opportunity ahead requires more than the best technology; it requires a strong V Team. A top priority for our Board is overseeing the company’s efforts to create a diverse, equitable and inclusive culture and develop a workforce with skills for the future. We believe investing in employees gives Verizon a powerful competitive edge. In addition to receiving regular briefings on employee engagement and workforce development initiatives, as a Board, we feel it is important to connect directly with employees. Our Directors participate in employee town halls, leadership forums and company-wide webcasts covering a range of topics from career development to current business and societal issues.
As a global community, we are facing some of the greatest challenges of our lifetime. Our Board is focused on steering the company through these challenges, supporting Verizon to engage on the societal issues that have a direct impact on our business, employees and the communities we serve, and continuing to build a resilient enterprise prepared to drive and power the interconnected future.
We believe we are laying the foundation for long-term success.
Sincerely,
Hans Vestberg Chairman and Chief Executive Officer |
Clarence Otis, Jr. Independent Lead Director |
Verizon 20222023 Proxy Statement
Proxy | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
This summary highlights information contained in the proxy statement and does not contain all of the information you should consider. We encourage you to read the entire proxy statement before voting. For information regarding Verizon’s 2021 performance, please read Verizon’s 2021 Annual Report on Form 10-K.
|
|
We expect that growth in wireless mobility services and national broadband services will be the most significant contributors to Verizon’s growth for the next several years. In 2022, we made important progress in both of these businesses.
Growth in wireless mobility and national broadband will be driven by our ability to provide high-speed, low latency wireless service over mid-band wireless spectrum using the fifth generation wireless technology (5G). We believe that the most valuable mid-band spectrum for providing 5G services is C-Band spectrum due to its propagation, speed and rules of use. We won the majority of C-Band spectrum in the country in an auction in 2021.
The C-Band spectrum that we won is not available for our and our customers’ use all at once. Portions of that spectrum first became available for our use in major urban areas at the beginning of 2022, more became available in additional metropolitan areas during the year and the remainder is expected to be available for our use by the end of 2023. Our most important strategic objective for 2022 was to efficiently make as much C-Band spectrum as possible available for our customers’ use as quickly as possible. As a result of our efforts, as of March 2023, we cover approximately 200 million people with this spectrum.
Our success in rolling out this spectrum will not only provide a better experience for our customers using their wireless service, but the speed and low latency of the service will allow them to use their wireless devices to do things that were previously impossible without a wired connection.
Similarly, the broad reach of the C-Band network will allow us to grow into a nationwide broadband provider, without incurring the capital costs necessary to provide wired high speed connectivity to homes and businesses. Using 5G technology over our C-Band network, we will be able to provide a true alternative to wired broadband at an attractive cost for our customers and an attractive level of investment for us. During 2022, we began to ramp our sales of wireless broadband as a cable replacement, which we call fixed wireless access (FWA). We succeeded in growing our FWA connections from a total of 223,000 at the beginning of 2022 to more than 1.4 million by the end.
Because these two growth engines – wireless mobility and FWA – use the same network, they provide a capital efficient path to future growth. We believe that we will continue to get more efficient with our capital – using less capital to generate the same amount of revenue for years to come. That will enable us to generate increased cash flow that we can reinvest in our business and return to our shareholders.
2022 was a pivotal year for the growth of Verizon. By successfully rolling out our C-Band spectrum to a majority of the U.S. population and establishing the FWA business as a formidable competitor to traditional wired broadband services, we laid the foundation for Verizon’s growth into the future.
i
Verizon 20222023 Proxy Statement
Proxy | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Agenda and voting recommendations
Item 1: Election of Directors
The Board of Directors recommends that you vote FOR the election of the Board’s nominees.
| ||
The Board’s nominees are all proven leaders with a strong sense of integrity and respect for differing viewpoints. As a group they bring a mix of backgrounds, perspectives, skills, experiences and |
Our nominees’ skills and experience
Consumer/B2B/retail | ||
Cybersecurity | ||
Financial expertise | ||
3 |
Marketing | |
Regulatory/public policy | ||
Risk management | ||
Strategic planning | ||
Technology | ||
Telecommunications |
Board diversity*
Board tenure and age*
6.46.8
years
average
tenure
6364
years old
average
age
* As of March 28, 2022.27, 2023. See Appendix A for the Board diversity disclosure required by Nasdaq Rule 5606.
ii
Verizon 20222023 Proxy Statement
Proxy | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Our nominees at a glance
Committee membership* | ||||||||||||||||||||
Name | Audit | Corporate Governance and Policy | Finance | Human Resources | Key skills and experience | |||||||||||||||
Shellye Archambeau Former Chief Executive Officer,
|
| Marketing Risk management Technology | ||||||||||||||||||
Roxanne Austin President and CEO, Austin Investment Advisors
| Cybersecurity Financial expertise Strategic planning | |||||||||||||||||||
Mark Bertolini Former Co-Chief Executive Officer, Bridgewater Associates, LP |
| Financial expertise Regulatory/public policy Strategic planning | ||||||||||||||||||
Vittorio Colao Former Chief Executive, Vodafone Group Plc | l | l | Consumer/B2B/retail Technology Telecommunications | |||||||||||||||||
Melanie Healey Former Group President, The Procter & Gamble Company |
| l | Consumer/B2B/retail Marketing Strategic planning | |||||||||||||||||
Laxman Narasimhan Chief Executive Officer,
| Consumer/B2B/retail Risk management Strategic planning | |||||||||||||||||||
Clarence Otis, Jr. Former Chairman and CEO, Darden Restaurants, Inc.
| Consumer/B2B/retail Financial expertise Risk management | |||||||||||||||||||
Daniel Schulman President and CEO, PayPal Holdings, Inc. |
| Cybersecurity Strategic planning Technology | ||||||||||||||||||
Rodney Slater Partner, Squire Patton Boggs LLP |
| l | Regulatory/public policy Risk management Strategic planning | |||||||||||||||||
Carol Tomé Chief Executive Officer, United Parcel Service, Inc. |
| l | Consumer/B2B/retail Financial expertise Strategic planning | |||||||||||||||||
Hans Vestberg Chairman and CEO, Verizon Communications Inc. | Strategic planning Technology Telecommunications | |||||||||||||||||||
Gregory Weaver Former Chairman and CEO, Deloitte & Touche LLP
| Financial expertise Risk management Strategic planning |
*Committee memberships are as of March 28, 2022.27, 2023. Independent Committee Chair Audit Committee Financial Expert
iii
Verizon 20222023 Proxy Statement
Proxy | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Governance highlights
Our Board has adopted robust governance structures and practices to enhance our independent oversight, effectiveness and accountability to shareholders.
Independent oversight
|
•
• Strong independent Lead Director with clearly delineated duties
• Regular executive sessions of independent Directors | |
Board effectiveness
|
• Active Board refreshment plan with commitment to diversity, with six new Directors added since 2017, half of whom are women or diverse with respect to race or ethnicity
• Orientation program for new Directors and continuing education for all Directors
• Limits on other public board service
• Annual Board and committee assessments
• Average tenure goal for independent Directors
| |
Accountability to shareholders
|
• Annual election of all Directors by majority voting
• Shareholder right to call special meetings
• Proxy access right with market terms
• No poison pill, and shareholder ratification required for any future poison pill
• No dual-class shares or voting right restrictions
• Robust stock ownership requirements for executive officers and Directors
• Proactive year-round shareholder engagement program
| |
|
•
•
•
•
|
iv
Verizon 2022 Proxy Statement
|
| Item 2: Advisory vote to approve executive compensation
The Board of Directors recommends that you vote FOR this proposal.
| |
We are asking shareholders to approve, on an advisory basis, the compensation of our named executive officers as described in the Compensation Discussion and Analysis and Compensation Tables beginning on page |
iv
Verizon 2023 Proxy Statement
Proxy | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Executive compensation program highlights
Our executive compensation program reflects Verizon’s commitment to industry-leading compensation and governance practices. The program is discussed in detail in the Compensation Discussion and Analysis beginning on page 23.25.
Compensation strategy
|
• Align executives’ and shareholders’ interests • Attract, retain and motivate high-performing executives
| |
Pay-for-performance essentials
| • Approximately 90% of named executive officers’ total compensation opportunity is variable, incentive-based pay • Defined benefit pension and supplemental executive retirement benefits frozen over 15 years ago • Quantitative ESG metric in Short-Term Incentive Plan | |
Best practice highlights
| • Shareholder approval policy for severance benefits • No cash severance benefits for the CEO • Significant executive share ownership requirements • Clawback policies • Anti-hedging policy • No tax gross-ups • No executive employment agreements |
The summary below shows the 20212022 compensation for each of our named executive officers, as required to be reported in the Summary Compensation table pursuant to U.S. Securities and Exchange Commission (SEC) rules. Please see the notes accompanying the Summary Compensation table beginning on page 4042 for more information.
Name and principal position | Salary ($) | Bonus ($) | Stock awards ($) | Option awards ($) | Non-equity incentive plan compensation ($) | Change in pension value and nonqualified deferred compensation earnings ($) | All other compensation ($) | Total ($) | ||||||||||||||||||||||||
Hans Vestberg Chairman and Chief Executive Officer | 1,500,000 | 0 | 14,500,057 | 0 | 3,825,000 | 0 | 517,814 | 20,342,871 | ||||||||||||||||||||||||
Matthew Ellis Executive Vice President and Chief Financial Officer | 950,000 | 0 | 6,525,007 | 0 | 1,453,500 | 0 | 183,382 | 9,111,889 | ||||||||||||||||||||||||
Ronan Dunne* Executive Vice President and Group CEO – Verizon Consumer | 1,050,000 | 0 | 8,000,073 | 0 | 1,496,250 | 0 | 245,727 | 10,792,050 | ||||||||||||||||||||||||
Tami Erwin Executive Vice President and Group CEO – Verizon Business | 950,000 | 0 | 6,525,007 | 0 | 1,184,942 | 0 | 208,530 | 8,868,479 | ||||||||||||||||||||||||
Kyle Malady** Executive Vice President | 850,000 | 0 | 5,250,065 | 0 | 1,402,500 | 166 | 171,971 | 7,674,702 | ||||||||||||||||||||||||
K. Guru Gowrappan*** Former Executive Vice President and Group CEO – Verizon Media | 588,462 | 3,000,000 | 6,250,033 | 0 | 0 | 0 | 125,947 | 9,964,442 |
Name and principal position | Salary ($) | Bonus ($) | Stock awards ($) | Option awards ($) | Non-equity incentive plan compensation ($) | Change in pension value and nonqualified deferred compensation earnings ($) | All other compensation ($) | Total ($) | ||||||||||||||||||||||||
Hans Vestberg Chairman and Chief Executive Officer | 1,500,000 | 0 | 14,500,057 | 0 | 3,262,500 | 0 | 570,193 | 19,832,750 | ||||||||||||||||||||||||
Matthew Ellis* Executive Vice President and Chief Financial Officer | 950,000 | 0 | 7,000,072 | 0 | 1,239,750 | 0 | 189,481 | 9,379,303 | ||||||||||||||||||||||||
Kyle Malady** Executive Vice President and Group CEO – Verizon Business | 900,000 | 0 | 6,500,051 | 0 | 1,174,500 | 0 | 196,565 | 8,771,116 | ||||||||||||||||||||||||
Sowmyanarayan Sampath*** Executive Vice President and Group CEO – Verizon Consumer | 779,808 | 0 | 7,000,050 | 0 | 838,463 | 0 | 135,805 | 8,754,126 | ||||||||||||||||||||||||
Craig Silliman^ Executive Vice President and President – Verizon Global Services | 850,000 | 0 | 6,500,098 | 0 | 1,109,250 | 0 | 175,149 | 8,634,497 | ||||||||||||||||||||||||
Tami Erwin^^ Former Executive Vice President and Group CEO – Verizon Business | 847,692 | 0 | 7,000,072 | 0 | 929,813 | 0 | 5,092,626 | 13,870,203 | ||||||||||||||||||||||||
Manon Brouillette^^^ Executive Vice President and Former | 950,000 | 0 | 7,000,072 | 0 | 1,239,750 | 0 | 93,780 | 9,283,602 |
* | Mr. |
** | Mr. Malady |
*** | Mr. |
^ | Mr. Silliman served as Executive Vice President and Chief Administrative, Legal and Public Policy Officer until October 10, 2022, after which he began to transition into his current role. |
^^ | Ms. Erwin stepped down from her role as Executive Vice President and Group CEO – Verizon Business on July 1, 2022 and remained a strategic advisor to Mr. Vestberg until her separation from Verizon |
^^^ | Ms. Brouillette ceased to serve as Group CEO – Verizon Consumer on December 5, 2022. |
v
Verizon 20222023 Proxy Statement
Proxy | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
| Item 3: Advisory vote on the frequency of future advisory votes to approve executive compensation The Board of Directors recommends that you vote for conducting future advisory votes on executive compensation EVERY YEAR. | |
We are asking shareholders to vote on whether future advisory votes on executive compensation should occur every year, every two years or every three years, as described on page 24. | ||
| Item
The Board of Directors recommends that you vote FOR ratification.
| |
We are asking shareholders to ratify the Audit Committee’s appointment of Ernst & Young LLP as Verizon’s independent registered public accounting firm for | ||
|
Items
The Board of Directors recommends that you vote AGAINST each of the shareholder proposals.
| |
In accordance with SEC rules, we have included in this proxy statement proposals submitted by shareholders for consideration. The proposals can be found beginning on page |
Meeting information Date and time May 11, 2023 at 8:45 AM, local time Place Salt Lake City Marriott University Park, 480 Wakara Way, Salt Lake City, Utah Record date March 13, 2023 Admission and voting information can be found beginning on page 76. You will need to register in advance to attend the meeting in person. |
vi
Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Our approach to Board composition
We believe that good governance starts with an independent, effective and diverse Board. Our Board is one of Verizon’s most critical strategic assets. As such, the composition of the Board evolves along with our strategic needs for the future. We believe we are more likely to achieve sustainable growth in shareholder value when our Board has the right mix of skills, expertise and tenure.
The Corporate Governance and Policy Committee is strategic and purposeful in its approach to refreshment and succession planning. Key factors the Committee considers when nominating Directors include:
Skills and experience – Verizon’s strategy is to extend our network leadership through continued innovation, grow our core business and provide our customers with best-in-class experiences, while maintaining the balanced capital allocation approach and financial discipline that our investors expect of us. In light of the Company’s strategy and expected future business needs, the Committee has identified the skills and experience in the table below as important to be represented on the Board as a whole.
• | Skills and experience – Verizon’s strategy is to extend our network leadership through continued innovation, grow our core business and provide our customers with best-in-class experiences, while maintaining the balanced capital allocation approach and financial discipline that our investors expect of us. In light of the Company’s strategy and expected future business needs, the Committee has identified the skills and experience in the table below as important to be represented on the Board as a whole. |
• Consumer/B2B/retail
• Cybersecurity
• Financial expertise | • Marketing
• Regulatory/public policy
• Risk management | • Strategic planning
• Technology
• Telecommunications |
Diversity – The Committee recognizes that a diverse set of viewpoints and practical experiences enhances the effectiveness of our Board in assessing the challenges and opportunities impacting our business and helping management achieve better outcomes. In evaluating candidates, the Committee considers how a candidate’s particular background, experience, qualifications, attributes and skills may complement, supplement or duplicate those of other prospective candidates. The Committee seeks a diverse group of candidates who possess the requisite judgment, background, skill, expertise and time, as well as diversity with respect to race, ethnicity and gender, to strengthen and increase the diversity, breadth of skills and qualifications of the Board. See Appendix A for the Board diversity disclosure required by Nasdaq Rule 5606.
• | Diversity – The Committee recognizes that a diverse set of viewpoints and practical experiences enhances the effectiveness of our Board in assessing the challenges and opportunities impacting our business and helping management achieve better outcomes. In evaluating candidates, the Committee considers how a candidate’s particular background, experience, qualifications, attributes and skills may complement, supplement or duplicate those of other prospective candidates. The Committee seeks a diverse group of candidates who possess the requisite judgment, background, skill, expertise and time, as well as diversity with respect to race, ethnicity and gender, to strengthen and increase the diversity, breadth of skills and qualifications of the Board. See Appendix A for the Board diversity disclosure required by Nasdaq Rule 5606. |
Age and tenure – The Committee believes it is important to bring new perspective and talents to the Board on a regular basis. Verizon does not have term limits for Directors because the Board recognizes that Directors who have served on the Board for an extended period can provide valuable insight into Verizon’s operations and future based on their experience with, and understanding of, Verizon’s history, policies and objectives. As an alternative to term limits, the Board seeks to maintain an average tenure of nine years or less for its independent Directors. In addition, to encourage new viewpoints on the Board, the Board seeks to add at least one new Director every two years on average. Under the Corporate Governance Guidelines, a Director must retire from the Board the day before the annual meeting of shareholders that follows his or her 72nd birthday.
• | Age and tenure – The Committee believes it is important to bring new perspective and talents to the Board on a regular basis. Verizon does not have term limits for Directors because the Board recognizes that Directors who have served on the Board for an extended period can provide valuable insight into Verizon’s operations and future based on their experience with, and understanding of, Verizon’s history, policies and objectives. As an alternative to term limits, the Board seeks to maintain an average tenure of nine years or less for its independent Directors. In addition, to encourage new viewpoints on the Board, the Board seeks to add at least one new Director every two years on average. We have exceeded this goal by adding six new Directors since 2017, half of whom are women or diverse with respect to race or ethnicity. Under the Corporate Governance Guidelines, a Director must retire from the Board the day before the annual meeting of shareholders that follows his or her 72nd birthday. |
Board size – The Committee periodically evaluates whether to change the size of the Board based on the Board’s needs and the availability of qualified candidates.
• | Board size – The Committee periodically evaluates whether to change the size of the Board based on the Board’s needs and the availability of qualified candidates. |
Board dynamics – The Committee considers each Director candidate’s individual contribution or potential contribution to the Board as a whole and strives to maintain one hundred percent active and collaborative participation.
• | Board dynamics – The Committee considers each Director candidate’s individual contribution or potential contribution to the Board as a whole and strives to maintain one hundred percent active and collaborative participation. |
1
Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Verizon’s Corporate Governance Guidelines establish standards for evaluating Director independence and require that a substantial majority of the Directors be independent. The Board determines the independence of each Director under New York Stock Exchange (NYSE) and Nasdaq governance standards, as well as the more stringent standards included in the Guidelines. These standards identify the types of relationships that, if material, could impair independence, and fix monetary thresholds at which the relationships are considered to be material. The Guidelines are available on the Corporate Governance section of our website at www.verizon.com/about/investors/corporate-governance. The Corporate Governance and Policy Committee conducts an annual review of any relevant business relationships that each Director may have with Verizon and reports its findings to the full Board.
Based on the Committee’s recommendation, the Board has determined that all of the non-employee Director candidates meet the independence requirements of applicable law, the NYSE, Nasdaq and Verizon’s Corporate Governance Guidelines: Ms. Archambeau, Ms. Austin, Mr. Bertolini, Mr. Colao, Ms. Healey, Mr. Narasimhan, Mr. Otis, Mr. Schulman, Mr. Slater, Ms. Tomé and Mr. Weaver.
Additionally, the Board has determined that each member of the Audit Committee and the Human Resources Committee meets the additional, heightened independence criteria applicable to such committee members under the applicable NYSE and Nasdaq rules.
The employers or former employers of Mr. Bertolini, Mr. Narasimhan, Mr. Schulman and Ms. Tomé each made payments to Verizon for telecommunications services during
The Corporate Governance and Policy Committee considers and recommends candidates for our Board. The Committee reviews all nominations submitted to Verizon, including individuals recommended by shareholders, Directors or members of management. The Committee also retains executive search firms from time to time to help identify and evaluate potential candidates.
Any shareholder who wishes to recommend a Director candidate to the Committee for its consideration should write to the Assistant Corporate Secretary at the address given under “Contacting us.” A recommendation for a Director candidate should include the candidate’s name, biographical data and a description of the candidate’s qualifications in light of the requirements described below. If we make any material changes to the Committee’s procedure for considering and nominating candidates, we will file a report with the SEC and post the information on the Corporate Governance section of our website at www.verizon.com/about/investors/corporate-governance. |
| What ESG skills and experience do our Directors bring to the boardroom?
ESG is increasingly incorporated into strategic and operational decision-making at Verizon. Each of our Directors has skills and experience in one or more aspects of ESG, including:
•
• corporate social responsibility;
• cybersecurity, data
• diversity, equity and inclusion;
• environmental sustainability, including renewable energy;
• governance;
• network reliability and resilience;
• regulatory and public policy trends;
• risk management; and
• talent attraction, retention and development. |
2
Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
The Committee reviews the qualifications of each candidate for election or re-election. For incumbent Directors, this review includes the Director’s participation in and contributions to the activities of the Board, the Director’s independence and past meeting attendance and whether the Director’s skills and expertise continue to align with Verizon’s long-term business strategy. After the Committee evaluates all candidates for Director, it presents its recommendation to the Board. The Committee also discusses with the Board any candidates who were considered by the Committee but not recommended for election or re-election.
Before they are nominated, each candidate for election and each incumbent Director standing for re-election must consent to stand for election or re-election and provide certain representations required under Verizon’s bylaws. Each candidate who is standing for election must also submit an irrevocable resignation, which will only become effective if (i) our Board or any Committee determines that any of the required representations were untrue in any material respect or that the candidate breached any obligation under Verizon’s bylaws or (ii) the candidate does not receive a majority of the votes cast at the annual meeting of shareholders and the independent members of our Board decide to accept the resignation. Any decision about a resignation following an incumbent Director’s failure to obtain a majority of the votes cast will be disclosed within 90 days after the election results are certified.
Shareholders wishing to nominate a Director should follow the procedures set forth in Verizon’s bylaws and summarized beginning on page 69.79.
Director criteria, qualifications and experience
To be eligible for consideration, any proposed candidate must:
Possess exemplary ethics and integrity
Have proven judgment and competence
Have professional skills and experience that align with the needs of Verizon’s long-term business strategy and complement the experience represented on the Board
Have demonstrated the ability to act independently and be willing to represent the long-term interests of all shareholders and not just those of a particular constituency or perspective
Be willing and able to devote sufficient time to fulfill responsibilities to Verizon and our shareholders
Verizon’s Directors are elected annually for a term of one year. We believe annual elections are consistent with good corporate governance because they foster director accountability and increase shareholder confidence. Verizon’s bylaws require Directors to be elected by a majority of the votes cast in an uncontested election.
Our Board has nominated the 1112 candidates below for election as Directors, all of whom currently serve as Directors of Verizon. In June 2021,Mr. Colao was elected to the Board elected Mr. Narasimhanin November 2022 as an independent Director, effective July 1, 2021;Director; he was recommended by an executive search firm retained by the Corporate Governance and Policy Committee. In August 2021, the Board elected Ms. Tomé as an independent Director, effective September 1, 2021; she was known to the Company as a result of herhis prior service on the Board in 2020.from 2019 to 2021.
Each candidate has consented to stand for election, and we do not anticipate that any candidate will be unavailable to serve. If any candidate were to become unavailable before the election, the proxy committee could vote the shares it represents for a substitute named by the Board. Each candidate has submitted an irrevocable, conditional letter of resignation that our Board will consider if that candidate fails to receive a majority of the votes cast.
Biographical information for each Director nominee follows. We have included career highlights and the key skills and experience that we believe each Director nominee brings to our Board, as well as their other public board directorships. All of our nominees bring more qualifications to the Board than those highlighted in their biographies, and these are reflected in the aggregate Board composition statistics provided in the Proxy Summary. When deciding to re-nominate these Directors, the Corporate Governance and Policy Committee and the Board considered each Director’s individual qualifications, as well as the aggregate of skills and experience represented on the Board, in light of the Company’s strategy and expected future business needs.
The Board of Directors recommends that you vote FOR the election of the following Director candidates. |
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Shellye Archambeau
| Roxanne Austin
| |||||||||
Independent Director since: 2013
Age:
Committees: Audit Corporate Governance and Policy (Chair) | Independent Director since: 2020
Age:
Committees: Audit Finance |
Key skills and experience:
•
•
•Risk
•
Career highlights:
• MetricStream, Inc., a leading provider of governance, risk, compliance and quality management ¡ Chief Executive Officer (2002-2018)
• Executive
Other public company boards:
Okta, Inc. (since 2018) Roper Technologies, Inc. (since 2018) Nordstrom, Inc. (2015-May 2022) |
Key skills and experience:
•Leadership: Seasoned leader who served as CEO of Move Networks, President and COO of DIRECTV, and CFO of Hughes Electronics. Named 2018 Director of the Year – Corporate Leadership and Service by the Forum for Corporate Directors and one of the most influential directors in the board room by the National Association of Corporate Directors in 2022 and 2013. Serves as co-chair of the annual Corporate Governance Conference at Northwestern’s Kellogg School of Management.
•Cybersecurity: Acquired significant cybersecurity experience through her extensive management and operating roles in a range of technology industries, including service as a director of CrowdStrike, a leader in cloud-delivered endpoint protection.
•Financial expertise: Developed a comprehensive background in finance and accounting as a public company audit committee member, CFO of Hughes Electronics and a partner at Deloitte & Touche LLP.
•Strategic planning: Oversaw a dramatic turnaround of the business within one year of her arrival at DIRECTV, with cash flow increasing from negative $400 million annually to cash flow positive by $400 million, and revenue increasing by 40%. Overhauled customer service at DIRECTV, resulting in the company winning J.D. Power’s award ranking #1 in customer satisfaction.
Career highlights:
• President and Chief Executive Officer of Austin Investment Advisors, a private investment and consulting firm (2003-present)
• President and Chief Executive Officer of Move Networks, Inc., an IP-based television delivery service (2009-2010)
• President and Chief Operating Officer of DIRECTV, Inc., a digital television entertainment service (2001-2003)
• Chief Financial Officer and
• Audit Partner and
Other public company boards:
AbbVie, Inc. (since 2013) CrowdStrike Holdings, Inc. (since 2018) Freshworks Inc. (since Abbott Laboratories Inc. (2000-April 2022) Teledyne Technologies Incorporated Target Corporation (2002-2020) Ericsson (2008-2016)
|
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Mark Bertolini
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Independent Director since: 2015
Age:
Committees: Finance (Chair) Human Resources | Independent Director since:
Age:
Committees: Corporate Governance and Policy
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Key skills and experience:
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•Financial
•Regulatory/public
•Strategic
Career highlights:
• Co-Chief Executive Officer of Bridgewater Associates, LP, a global investment management firm (January
• Aetna Inc., a multi-national, Fortune 100 diversified healthcare benefits company ¡ Chairman (2011-2018) ¡ Chief Executive Officer (2010-2018) ¡ President (2007-2010) ¡ Other
• Executive
Other public company boards:
CVS Health Corporation (2018-2020) |
Key skills and experience:
•Leadership: Built and transformed Vodafone Group Plc through organic growth, acquisitions and sales into one of the world’s largest communications companies with mobile operations in 24 countries and partnerships in over 40 more countries. • Consumer/B2B/retail: Grew Vodafone to serve, directly and through joint ventures, approximately 640 million mobile customers, 21 million broadband customers and 14 million TV customers. Additional consumer experience with RCS MediaGroup, a leading Italian publishing company. • Technology: Led Vodafone in the rapid and continuous development of mobile and other communications technology, with intensive capital spending to enhance high speed mobile networks, provide broadband and enterprise services, enhance the secure exchange of data, and develop 5G and the internet of things. • Telecommunications: Brings a valuable global perspective on, and extensive operational experience with, the rapidly changing telecommunications industry. Led Italy’s efforts to roll out broadband and 5G connectivity across the country as Italian Minister for Innovation, Digital Transition and Space. Provides unique insight into Verizon Wireless’ business as a result of his five year tenure on the Board of Representatives when Verizon Wireless was still a joint venture between Vodafone and Verizon. Career highlights: • Italian Minister for Innovation, Digital Transition and Space (2021-October 2022) • Vodafone Group Plc, a global mobile communications company ¡ Chief Executive (2008-2018) ¡ Director (2006-2018) ¡ Other executive positions, including Regional Chief Executive Officer for Southern Europe, Middle East and Africa (1999-2004) • Member, Verizon Wireless Board of Representatives (2008-2013) • Senior Advisor, Vice Chairman EMEA, General Atlantic (2019-2021; January 2023-present) Other public company boards: Unilever PLC and Unilever N.V. (2015-2021) Mr. Colao previously served on our Board from 2019 to 2021. |
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Verizon 2023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Melanie Healey | Laxman Narasimhan | |||||||||
Independent Director since: 2011 Age: 61 Committees: Corporate Governance and Policy Human Resources | Independent Director since: 2021 Age: 55 Committees: Audit Corporate Governance and Policy | |||||||||
Key skills and experience: • Leadership: Accomplished, consumer-focused executive with substantial global experience and a track record of delivering growth, driving operational improvements and launching successful product innovations over a 33-year career at 3 global iconic consumer product brand companies, including leading a global business for 6 years.
•Consumer/B2B/retail: Gained deep and valuable branding, distribution and operating experience with consumer wellness products on a global scale over a long career at 3 different multi-national organizations in the consumer goods industry (Procter & Gamble, Johnson & Johnson and S.C. Johnson & Sons). Continues to focus on the consumer/retailing sector through service on the Target board of directors and on a globally recognized consumer and B2B brand through service on the board of Hilton, which has
•Marketing: Brings a multi-cultural and multi-national perspective acquired from working 18 years internationally to corporate strategy with respect to brand building, new product and commercial innovation and the consumer experience, as well as experience with managing large and complex marketing budgets.
•Strategic planning: As Group President of North America at Procter & Gamble, oversaw multi-year strategic planning for the largest division of the company, with over $32 billion in annual sales, and reversed a decline in sales after assuming that role. Currently chairs the Sustainability and Innovation Committee of the PPG Industries Board of Directors.
Career highlights:
• The Procter & Gamble Company, a leading provider of branded consumer packaged goods ¡ Group President (2007-2015) ¡ Global President (2005-2007) ¡ Other
• Johnson & Johnson (1986-1990)
• S.C. Johnson & Sons (1983-1986)
Other public company boards:
Hilton Worldwide Holdings Inc. (since 2017) PPG Industries, Inc. (since 2016) Target Corporation (since 2015) |
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Verizon 2022 Proxy Statement*
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* Ms. Healey will not stand for re-election to the board of directors of Target Corporation at the end of her current term expiring at the company’s 2023 annual meeting of shareholders, which is expected to take place in June 2023. |
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Key skills and experience:
•Leadership: Insightful and strategic leader with wide experience across the consumer goods sector and a proven track record in developing purpose-led brands, including as
•Consumer/B2B/retail: Provides valuable experience and thought leadership in complex global consumer-facing businesses as a result of a 30-yearcareer
•Risk management: Developed significant risk management experience, including supply chain risk management experience, while piloting Reckitt Benckiser through the supply chain disruptions of the COVID-19 pandemic.
•Strategic planning: Articulated corporate purpose
Career highlights: • Starbucks Corporation, the premier roaster, marketer and retailer of specialty coffee in the world ¡ Chief Executive Officer (March 2023-present) ¡ Chief Executive Officer-elect (October 2022-March 2023)
• Chief Executive Officer of Reckitt Benckiser Group Plc, a global consumer-goods company
• PepsiCo, Inc., a leading global food and beverage company ¡ Global Chief Commercial Officer (2019) ¡ Chief Executive Officer, Latin America, Europe and Sub-Saharan Africa (2017-2019) ¡ Other
• McKinsey & Company (1993-2012)
Other public company boards:
Starbucks Corporation (since March 2023) Reckitt Benckiser Group Plc |
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Verizon 2023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Clarence Otis, Jr. (Lead Director) | Daniel Schulman | |||||||||
Independent Director since: 2006 Age: 66 Committees: Audit Finance Human Resources | Independent Director since: 2018 Age: 65 Committees: Human Resources (Chair) | |||||||||
Key skills and experience:
•Leadership: Led Darden Restaurants, Inc., the largest company-owned and operated full-service restaurant company in the world, as CEO for 10 years, achieving sales growth of over 75% during the period. Known as a purpose-driven and values-based leader, with Darden being recognized by Fortune magazine for four consecutive years during his tenure as one of its 100 Best Companies to Work For. Named one of the most influential directors in the board room by the National Association of Corporate Directors in 2019.
•Consumer/B2B/retail: Brings deep and valuable insights into consumer services and retail operations gleaned from his experience leading a Fortune 500 company that owned well-known national consumer brands including Olive Garden, LongHorn Steakhouse, Red Lobster and Capital Grille. Further consumer and retail expertise through board position at VF Corporation, which owns well-known national brands including Timberland and North Face.
•Financial expertise: Gained substantial financial expertise through, among other roles, investment banking positions of increasing seniority over 12 years, the CFO role at Darden, serving as a
•Risk management: Acquired significant expertise with financial risk assessment and enterprise risk management during his career in investment banking and at Darden, as well as through his many years of service on the Federal Reserve Bank of Atlanta Board, the
Career highlights:
• Darden Restaurants, Inc. ¡ Chairman (2005-2014) ¡ Chief Executive Officer (2004-2014) ¡ Other
• Director of the Federal Reserve Bank of Atlanta (2010-2015)
• Investment banker and lawyer specializing in securities and finance
Other public company boards:
The Travelers Companies, Inc. (since 2017) VF Corporation (since 2004) MFS Mutual Funds complex (since 2017) |
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Verizon 2022 Proxy Statement
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Key skills and experience:
•Leadership: Successful and dynamic leader in the fiercely competitive technology and e-commerce space with a proven track record of creating shareholder value through innovation and a focus on values at numerous companies, including PayPal, which has approximately
•Cybersecurity: Gained extensive cybersecurity and risk management experience as a director of Symantec Corporation, a global leader in cybersecurity, for nearly 20 years, including serving as the independent chairman for 6 years.
•Strategic planning: Spearheaded innovation and growth at start-ups and established companies, including Priceline, where he grew annual revenues from $20 million to nearly $1 billion over two years, Virgin Mobile USA, where he successfully built a pre-paid cellphone business, American Express, where he expanded global mobile and online payment services, and PayPal, where he
•Technology: Acquired significant expertise in mobile technology and digital innovation over a long career spanning the telecommunications, financial technology and e-commerce industries.
Career highlights:
• PayPal Holdings, Inc., a leading online payments company ¡ President and Chief Executive Officer (2015-present) ¡ President and CEO-Designee (2014-2015)
• Group President of the Enterprise Group at American Express Company (2010-2014)
• President of the Prepaid Group at Sprint Nextel Corporation (2009-2010)
• Founding CEO of Virgin Mobile USA, Inc. (2001-2009)
• President and CEO of Priceline Group, Inc.
• Various
Other public company boards:
PayPal Holdings, Inc. (since 2015) NortonLifeLock Inc. (formerly Symantec FLEX LTD. (2009-2018) |
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Verizon 2023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Rodney Slater | Carol Tomé | |||||||||
Independent Director since: 2010 Age: 68 Committees: Corporate Governance and Policy Human Resources | Independent Director since: 2021 Age: 66 Committees: Finance | |||||||||
Key skills and experience:
•Leadership: Nationally recognized for innovative infrastructure development and forging strategic public and private partnerships. As U.S. Secretary of Transportation, oversaw national transportation policy, spearheaded several historic legislative measures, including record funding for surface transportation investment and aviation safety and security, promoted intermodal transportation systems and led effort to significantly expand high speed rail network.
•Regulatory/public policy: Brings a strategic, collaborative and result-oriented approach to oversight of regulatory and public policy issues developed over his long and accomplished career in both the public and private sectors.
•Risk management: Globally recognized advisor for reputational risk management, corporate compliance and emergency preparedness, having served as an independent monitor/advisor for Toyota, Takata and Fiat Chrysler as these companies worked through safety issues, and coordinated the Federal Highway Administration’s response to several major natural disasters.
•Strategic planning: Implemented a visionary strategic plan for the U.S. Department of Transportation to expand its focus on safety, mobility and access, economic development and trade, the environment and national security. Developed an innovative financing and contracting program at the Federal Highway Administration that produced significant operational and cost efficiencies.
Career highlights:
• Partner, Squire Patton Boggs LLP, a law firm
• U.S. Secretary of Transportation (1997-2001)
• Administrator, Federal Highway Administration (1993-1997)
• Various policy positions with the State of Arkansas
Other public company boards:
EVgo Inc. (since Stagwell Inc. (since Kansas City Southern (2001-2019) Transurban Group (2009-2018) |
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Verizon 2022 Proxy Statement
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Key skills and experience:
•Leadership: After being appointed CEO of UPS in June 2020, led the company through an unprecedented surge in demand for services, while improving competitiveness and reducing bureaucracy. Demonstrated strong financial leadership as CFO for over 18 years at Home Depot, with responsibility for all corporate finance matters including financial reporting, financial planning and analysis, financial operations, internal audit, investor relations and tax. Led strategic business development during a critical time for Home Depot, as well as the IT and
•Consumer/B2B/retail: Proven track record in growing and innovating at both consumer and B2B businesses with large geographic footprints and employee bases. Reinvigorated Home Depot’s consumer business while navigating the Great Recession and housing crisis. Championed Home Depot’s initiative designed to grow the B2B side of its business.
•Financial
•Strategic planning: As CEO of UPS, navigated the immense challenges and opportunities of the delivery and logistics business during the COVID-19 pandemic. Played a pivotal role in strategic business development at Home Depot as it transformed into one of the world’s largest retailers – during her tenure as CFO, Home Depot doubled sales to over $108 billion and generated a 450% increase in shareholder value.
Career highlights:
• Chief Executive Officer of United Parcel Service, Inc., the world’s largest package delivery company and a premier provider of global supply chain management solutions (2020-present)
• The Home Depot, Inc., one of the world’s largest home improvement retailers o Executive Vice President – Corporate Services and Chief Financial Officer (2007-2019) o Chief Financial Officer (2001-2007) o Other
• Federal Reserve Bank of Atlanta o Director (2008-2013)
Other public company boards:
United Parcel Service, Inc. (since 2003) Cisco Systems, Inc. (2019-2020) Certain Fidelity Mutual Funds (2017) Ms.Tomé previously served on our Board in 2020. |
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Verizon 2023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Hans Vestberg (Chairman) | Gregory Weaver | |||||||||
Director since: 2018 Age: 57 | Independent Director since: 2015 Age: 71 Committees: Audit (Chair) Finance | |||||||||
Key skills and experience:
•Leadership: Driving Verizon’s leadership position in the deployment of 5G technology and multi-access edge computing in the U.S. Built an industry-leading telecommunications software and services organization at Ericsson, one of the world’s largest telecommunications companies. Member of the
•Strategic planning: Leading Verizon’s Network as a Service strategy and network transformation as the key drivers to position the company to carry its 4G leadership into the 5G era. Implemented bold and innovative strategic changes, including Verizon 2.0, the transformation of Verizon’s operating model to a customer-focused business served by industry-leading networks, as well as Ericsson’s successful diversification into the software and services business from its traditional hardware-centric business.
•Technology: Gained significant expertise in mobile technology and telecommunications network architecture as Verizon’s Chief Technology Officer and over his 25-year career at Ericsson.
•Telecommunications: Brings to the Board extensive operational and strategic experience and a deep understanding of the challenges and opportunities presented in the evolving global telecommunications landscape, as well as in-depth knowledge of Verizon’s businesses.
Career highlights:
• Verizon Communications Inc. ¡ Chairman ¡ Executive Vice President, President – Global Networks and Chief Technology Officer (2017-2018)
• Ericsson ¡ President and Chief Executive Officer (2010-2016) ¡ Chief Financial Officer (2007-2009) ¡ Other executive positions throughout the global operations
Other public company boards:
BlackRock, Inc. (since Hexagon AB (2017-2018) |
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Verizon 2022 Proxy Statement
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Key skills and experience:
•Leadership: Twice elected by fellow partners to serve as Chairman and CEO of Deloitte & Touche LLP’s audit and enterprise risk services practice in the U.S., overseeing all operations, regulatory interaction and quality control for all audit and risk consulting clients. Led the firm through significant change in the accounting industry resulting from the passage of the Sarbanes-Oxley Act. Member of the governing board of the Independent Directors Council.
•Financial expertise: Gained comprehensive public accounting experience at the highest level and substantial financial expertise over his
•Risk management: Developed a deep understanding of vertical and horizontal risk exposures – within companies and across industries – through providing enterprise risk services. Also led Deloitte & Touche through assessments of its own audit risk exposures.
•Strategic planning: As a member of Deloitte’s
Career highlights:
• Deloitte & Touche LLP, the accounting, auditing and risk advisory subsidiary of Deloitte LLP ¡ Chairman and Chief Executive Officer (2001-2005 and 2012-2014) ¡ Member, Deloitte LLP Board of Directors (2006-2012) ¡ Partner (1985-2014)
Other public company boards:
Goldman Sachs Trust (since 2015) |
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
The membership, structure, policies and practices of our Board and its committees promote the effective exercise of the Board’s role in the governance of Verizon. In addition, our Corporate Governance Guidelines provide a framework for the Board’s operations and address key governance practices. The Corporate Governance and Policy Committee monitors best practices and developments in corporate governance, considers the views of Verizon’s shareholders, and periodically recommends changes to the Board’s policies and practices, including the Guidelines.Directors provide input on the design of the Board annually, as part of the Board assessment process, and as warranted throughout the year.
Verizon’s governance framework provides the Board with the flexibility to select the appropriate Board leadership structure for the Company. In making this leadership structure determination, the Board considers many factors, including the specific needs of the business and the long-term interests of our shareholders.
Given the dynamic and highly competitive environment in which Verizon operates, the Board believes that Verizon and our shareholders are best served by a Chairman who has broad and deep knowledge of our industry, providing valuable knowledge to the Board and increasing the information available to it, and who has the vision, energy and experience to position Verizon as the leader of transformational change in the communications ecosystem. Based on these considerations, the Board has determined that, at this time, our CEO, Hans Vestberg, is the Director best qualified to serve in the role of Chairman. As CEO, Mr. Vestberg also has a greater understanding of the strategies and tactics of the Company and can most readily identify potential opportunities and problems.
To maintain an appropriate level of independent oversight, checks and balances in its governance, and consistent with the Corporate Governance Guidelines, the independent members of the Board have elected an independent Lead Director who has the responsibilities described under “Role of the Lead Director.” Clarence Otis, Jr. currently serves as Lead Director. Mr. Otis acquired significant expertise in financial risk assessment and enterprise risk management as a member of the Federal Reserve Bank of Atlanta Board, multiple public company boards and audit committees, and as CEO of Darden Restaurants, and is well qualified to lead the Board in fulfilling its role in risk oversight. The Lead Director and our Chairman and CEO meet and speak with each other regularly about the Company’s strategy and operations and the functioning of the Board. The Lead Director provides a tangible independent source of authority and serves as an impartial resource for the Board to express its views regarding management. In addition, the Lead Director regularly represents the Board in communications with shareholders and other stakeholders, and any shareholder or interested party may communicate directly with the Lead Director.
All Directors play an active role in overseeing Verizon’s business at both the Board and committee level. Every Director is given the agenda for each Board meeting in advance and can request changes. In addition, all Directors have unrestricted access to the Chairman and the senior leadership team at all times.
The Board believes that shareholders are best served by this current leadership structure because it features an independent Lead Director who provides independent and objective oversight and who can express the Board’s positions in a forthright manner, as well as independent Directors who are fully involved in the Board’s operations and decision making. | Clarence Otis, Jr. Lead Director
Role of the Lead Director
• Promotes a strong Board culture, including encouraging and facilitating active participation of all Directors
• Approves the agenda, schedule and materials for all Board meetings, in consultation with the Chairman
• Is available to advise the committee chairs in fulfilling their designated responsibilities
• Acts as principal liaison with the Chairman
• Chairs executive sessions, including those held to evaluate the CEO’s performance and compensation
• Chairs any meeting of the Board if the Chairman is not present
• Calls Board meetings and executive sessions as needed
• Leads the Board’s annual self-evaluation
• Oversees the process for CEO succession planning along with the Human Resources Committee
• Acts as a primary point of contact for Board communication with major shareholders and other key stakeholders, as appropriate |
Limiting service on other boards
Based on the evolving role of directors and the need to devote sufficient time to fulfill their responsibilities effectively, the Board has adopted a policy that a Director who is an executive officer of a public company should serve on no more than two public company boards, and other Directors should serve on no more than four public company boards.
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Board meetings and executive sessions
In 2021,2022, our Board of Directors held 11eight meetings, including 6six regularly scheduled meetings and 5two special meetings. Our Board met in virtual-only format, as well as in hybrid format, with safety measures in place for those attending in person, allowing for in-person interaction while retaining the flexibility to adapt to continually evolving COVID-19 pandemic circumstances and protocols in 2021.
No incumbent Director attended fewer than 75% of the total number of meetings of our Board and the committees to which the Director was assigned in 2021.2022. Directors standing for re-election are expected to attend the annual meeting of shareholders. In 2021,2022, all nine Directors standing for re-election attended the annual meeting, which was conducted in a virtual-only format.meeting.
The Corporate Governance Guidelines require the independent Directors to meet in executive session without any members of management present at least twice a year to review and evaluate the performance of the Board and to evaluate the performance and approve the compensation of the CEO. In practice, our Board typically meets in executive session during each regular Board meeting.
Based on the increasing demands placed upon directors and the need to devote sufficient time to fulfill their responsibilities effectively, the Board has a policy that a Director who is an executive officer of a public company should serve on no more than two public company boards, and other Directors should serve on no more than four public company boards.
Board committees
Our Board of Directors has established four standing committees: the Audit Committee, the Corporate Governance and Policy Committee, the Finance Committee, and the Human Resources Committee. Each committee has a written charter that defines its specific responsibilities. The chair of each committee approves the agenda and materials for each meeting. Each committee has the authority to retain independent advisors to assist it in carrying out its responsibilities.
Our committee meetings are not held concurrently, which enables our Directors to sit on multiple committees. Our newly appointed Directors also attend all committee meetings for a period prior to being appointed to any particular committee, which gives them a broad-based introduction to the Company and allows them to understand the inner workings of all committees.
Where to find more information
You can find information about Verizon’s Directors, Board committees and a video from our Lead Director on the Corporate Governance section of our website at www.verizon.com/about/investors/corporate-governance. You can also access Verizon’s Corporate Governance Guidelines, Code of Conduct and other corporate governance materials, including Verizon’s certificate of incorporation, bylaws, committee charters and policies at that site. You can request copies of these materials from the Assistant Corporate Secretary at the address given under “Contacting us.”
In addition, you can access all of Verizon’s ESG reporting, including our ESG Report, TCFD Report,Reports, Transparency Reports, Political Engagement Reports and EEO-1 Report, as well as key company policies, through our ESG Resources Hub at www.verizon.com/about/investors/reporting.
Beyond the boardroom
Engagement outside of Board meetings provides our Directors with additional insight into our business and our industry, and gives them valuable perspectives on the performance of our Company, the Board, our CEO and other members of senior management, and on the Company’s strategic direction.
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Audit Committee
Key responsibilities and activities
• Assess and discuss with management Verizon’s significant business risk exposures (including those related to cybersecurity, data privacy, data security,
• Assess Verizon’s overall control environment, including controls related to financial reporting, disclosure, compliance and significant financial and business risks
• Appoint, approve fees for, assess the independence and oversee the work of the independent registered public accounting firm
• Oversee financial reporting and disclosure matters, including review of the annual and quarterly reports on Forms 10-K and 10-Q, earnings releases and guidance, and the process for the CEO and CFO certifications
• Oversee Verizon’s internal audit function and review significant internal audit findings and recommendations
• Assess Verizon’s compliance processes and programs, including the Code of Conduct
• Review the Chief Compliance Officer’s annual report regarding anti-corruption compliance, compliance with significant regulatory obligations, export controls, and data protection
• Assess policies and procedures for executive officer expense accounts and perquisites, including the use of corporate assets
• Assess procedures for handling complaints and confidential, anonymous employee submissions relating to accounting, internal accounting controls or auditing matters • Review reports and disclosures of significant conflicts of interest and related person transactions
The Board has determined that each of Ms. Archambeau, Ms. Austin, Mr. Narasimhan, Mr. Otis and Mr. Weaver is an audit committee financial expert. |
Members
Gregory Weaver (Chair)
Shellye Archambeau
Roxanne Austin
Laxman Narasimhan
Clarence Otis, Jr.
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Corporate Governance and Policy Committee
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Key responsibilities and activities
• Evaluate the structure and practices of our Board and its committees, including size, composition, independence and operations
• Recommend changes to our Board’s policies or practices or the Corporate Governance Guidelines
• Identify and evaluate the qualifications of Director candidates
• Recommend Directors to serve as members of each committee and as committee chairs
• Review potential related person transactions
• Facilitate the annual assessment of the performance of the Board and its committees
• Serve as hub for oversight of ESG, including ESG commitments, reporting and engagement, corporate responsibility and sustainability
• Oversee Verizon’s position and engagement on important public policy issues, including those relating to political contributions, lobbying activities, and human rights, that may affect our business and reputation
• Review the activities of Verizon’s community and social impact initiatives, including philanthropic activities |
Shellye Archambeau (Chair) Vittorio Colao
Melanie Healey
Laxman Narasimhan
Rodney Slater
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Finance Committee
Key responsibilities and activities
• Monitor Verizon’s capital needs and financing arrangements and ability to access the capital markets
• Monitor expenditures under the annual capital plan approved by our Board
• Review Verizon’s policies and strategies for managing currency, interest rate, renewable energy and counterparty exposures
• Review and approve Verizon’s derivatives policy and monitor the use of derivatives, including our renewable power purchase agreement strategy
• Review Verizon’s insurance and self-insurance programs
• Oversee the investment of pension assets and the funding of pension and other postretirement benefit obligations |
Mark Bertolini (Chair)
Roxanne Austin Vittorio Colao
Clarence Otis, Jr.
Carol Tomé
Gregory Weaver
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Human Resources Committee
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Key responsibilities and activities
• Oversee the development of Verizon’s executive compensation program and policies
• Approve corporate goals relevant to the CEO’s compensation
• Evaluate the CEO’s performance and recommend his compensation to the Board
• Review and approve compensation and benefits for selected senior managers
• Consult with the CEO on talent development
• Oversee succession planning and assignments to key leadership positions
• Oversee human capital management, including with respect to employee diversity, equity and inclusion, talent acquisition, retention and development, employee engagement, pay equity and corporate culture
• Review and make determinations under Verizon’s clawback policies
• Review the impact of Verizon’s executive compensation policies and practices, and the performance metrics underlying the compensation program, on Verizon’s risk profile
• Review and recommend non-employee Director compensation |
Members
Daniel Schulman (Chair)
Mark Bertolini
Melanie Healey
Clarence Otis, Jr.
Rodney Slater
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Board and committee assessments
Our Board conducts a comprehensive annual assessment to enhance the effectiveness of the Board and its committees and to continue to reflect evolving best practices in their processes. While the assessment process is generally led by the Lead Director, the Board periodically engages a third-party consulting firm to bring an outside perspective to the process. As part of this robustthe annual assessment, each Director completes a detailed written questionnaire designed to elicit suggestions for improving Board and committee effectiveness and feedback on a range of issues, including Board leadership, culture, purpose and strategy, composition and structure and risk management. In addition, the Lead Director or the third-party consulting firm conducts individual interviews with each of the independent Directors to discuss these topics, among others. The Board discusses the feedback received from the questionnaires and interviews during an evaluation session facilitated by the Lead Director. The evaluation for 20212022 was conducted by the Lead Director and concluded that the Board and its committees are operating effectively. The recommendationsRecommendations in recent years to further enhance Board effectiveness, which we addressed, includehave included continued focus on Board refreshment, strategic oversight, including 5G measures of success, as well asand the development of Verizon’s next generation of leaders.
In addition to annual assessments, the Board evaluates and modifies its oversight of Verizon’s operations on an ongoing basis. During their executive sessions, the independent Directors consider agenda topics that they believe deserve additional focus and raise new topics to be addressed in future meetings.
The Corporate Governance and Policy Committee annually appraises the framework for our Board and committee assessment processes.
Board and committee assessment process | ||||||||||||||||||||
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Feedback solicited
Online questionnaire on a range of topics relating to enhancing Board effectiveness |
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One-on-one
Candid, one-on-one discussions between the Lead Director and Directors to elicit additional feedback |
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Reporting back
A summary of the assessment results provided to the Board |
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Closed session discussion
Closed session discussion of the assessment results facilitated by the Lead Director |
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Feedback
Policies and practices updated as appropriate to address any suggestions or enhancements per the assessment | |||||||||||
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Director orientation and continuing education
We provide our Directors with comprehensive orientation and education programs to promote a deep understanding of issues affecting our business and industry, help Directors stay current and knowledgeable about the Company’s business and its competitive and technology landscape, and support Directors in performing their oversight duties.
New Director orientation. When a new Director joins the Board, we conduct an orientation program that includes, among other things, a review of the Company’s purpose, business strategy and operations, technology, financial condition, legal and regulatory framework and other relevant topics.
Director continuing education. We support current Directors in their ongoing learning by providing continuing education opportunities and programs. These programs include presentations by thought leaders and industry experts, formal education sessions, meetings with management subject matter experts, participation in industry forums and site visits.
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Verizon 2022 Proxy Statement
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All of our Directors have deep experience and expertise in strategic planning and execution. The Board engages Verizon’s senior leaders in robust discussions about strategic goals and challenges them to execute on the strategic plan, address emerging challenges and disruptions, and promote innovation. In addition to an annual strategy retreat, strategy is allocated substantial time on the agenda for each regular Board meeting. During these reviews, the Board engages with senior management regarding the competitive landscape, operational objectives and challenges and regulatory developments.
14
Verizon 2023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Oversight of business risks
While senior management has primary responsibility for managing business risks, our Board of Directors is responsible for risk oversight. The Board works closely with senior management to develop a comprehensive view of Verizon’s key short- and long-term business risks. Verizon has a formalized business risk management reporting process that is designed to provide visibility to the Board about critical risks and risk mitigation strategies. Through its oversight role, the Board sends a message to management that risk management is not an impediment to the conduct of business, but is instead an integral component of strategy, culture and business operations.
The Board of Directors oversees the management of risks inherent in the operation of Verizon’s businesses and the implementation of its strategic plan by using several different levels of review. The Board addresses the primary risks associated with Verizon’s business units and corporate functions in its operations reviews of those units and functions. Further, the Board reviews the risks associated with Verizon’s strategic plan throughout the year.
In addition, each of our Board committees oversees the management of risks that fall within that committee’s areas of responsibility. In performing this function, each Board committee has full access to management and may engage independent advisors. As part of the Board’s risk oversight function, the Board regularly brings in outside advisors and experts to speak to the Board on topics including emerging business risks. In 2022, these topics included geopolitical and economic risks, opportunities and trends.
Enterprise risk management program. The Audit Committee oversees the operations of Verizon’s enterprise risk managementEnterprise Risk Management program, which identifies the primary risks to Verizon’s business and also assesses Verizon’s overall control environment, including riskscontrols related to cybersecurity, data privacyfinancial reporting, disclosure, compliance and security,significant financial and the Company’s supply chain. Thebusiness risks. These risks inform Board and Audit Committee periodically monitors and evaluatesdiscussion topics throughout the year.
Senior management teams from across the business meet with the Audit Committee, on at least a semi-annual basis, to discuss the primary risks associated with particulartheir business units and functions.functions and related risk mitigation initiatives. As part of Verizon’s annual enterprise risk assessment process, the Audit Committee also reviews key business risks with the Chief Financial Officer, and the Senior Vice President of Internal Audit. These risks inform BoardAudit and Audit Committee discussion topics throughout the year.Chief Compliance Officer.
In addition,
The Chief Financial Officer updates the Audit Committee works with on a quarterly basis on the activities of the Verizon Management Audit Committee, which has management oversight responsibility for the implementation of the Enterprise Risk Management program.
Verizon’s Senior Vice President of Internal Audit, who helps identify, evaluate and implementfunctionally reports directly to the Audit Committee, facilitates the Committee’s oversight of the Company’s implementation of risk management controls and methodologies to address identified risks, including financial, operational, regulatory and compliance risks.
Verizon’s Chief Compliance Officer, who also functionally reports directly to the Audit Committee, oversees periodic risk assessments of specific compliance risk areas, such as anti-corruption, and reports the findings to the Committee.
The Committee routinely meets privately with representatives from the independent registered public accounting firm, the Senior Vice President of Internal Audit, and the Chief Administrative, Legal and Public Policy Officer.
Strategic crisis management. In order to position Verizon leadership and the Board to respond to strategic risks and protect Verizon’s core assets in a potential crisis, the Company maintains a Strategic Crisis Management Program. The Program defines clear roles and responsibilities in dealing with various potential crises and outlines a process to make decisions and implement appropriate actions on a timely basis. Through the Program, the Verizon Strategic Crisis Leadership Team is positioned to assume executive ownership of strategic crisis events through drills and scenario-based training. The Program also includes employee crisis awareness training in order to encourage employees across the Company to quickly identify and report circumstances or events that could develop into a strategic crisis so that our leadership team can take appropriate steps in response. In addition, Verizon’sour Board of Directors maintains a Board Crisis Response Plan, which is a structured plan to be used in connection with any crisis that could have a significant strategic impact on the Company’s brand, reputation, finances or legal, political or regulatory position – providingposition. The Plan provides a framework for appropriate Board oversight and assessment of the response to a crisis while allowingthat allows the necessary flexibility to address the different types of crises that might arise.
Financial risk and capital allocation. The Finance Committee assists our Board in its oversight of financial risk management. In performing this function, the Finance Committee monitors Verizon’s capital needs and financing plans and oversees the strategy for managing risks related to currency, interest rate, and renewable energy and counterparty exposures. The Finance Committee reviews and approves the Company’s derivatives policy and monitors the use of derivatives. The Finance Committee also reviews Verizon’s pension and other postretirement benefit obligations, as well as its insurance and self-insurance programs.
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Oversight of ESG strategy and risks
Our Board recognizes that operating responsibly – minimizingand appropriately managing the environmental impact ofand social risks arising from our operations protecting the privacy of our customers’ information and respecting human rights by creating an environment of respect, integrity and fairness for our employees and customers wherever we do business – isare fundamental to the long-term success of our Company. The Corporate Governance and Policy Committee oversees corporate responsibility, public policy and sustainability. Verizon has a Chiefcentralized ESG Officerteam that is dedicated to enhancing the Company’s sustainability reporting and stakeholder engagement on environmental, social and governance issues that align with Verizon’s core business strategy. The Chief ESG Officer heads aThis cross-functional team that focuses on strategic areas including governance, reporting, human rights and environmental sustainability and digital trust and safety and also oversees Verizon’s efforts to deliver on its ESG commitments. The Chief ESG OfficerSenior Vice President, Deputy General Counsel and Corporate Secretary regularly provides the Corporate Governance and Policy Committee with updates on the Company’s ESG priorities, commitments, stakeholder engagement and reporting. In addition, the ESG team partners with the Enterprise Risk Management team to bolster Verizon’s controls framework that collects, manages and reports on the information required for all of its ESG-related public disclosures.
Environmental sustainability and climate. ToVerizon has set long-term and interim targets to address current and future climate-related risks, Verizonrisks. Our long-term goal is to achieve net-zero emissions in our operations by 2035. In support of this goal, we expect to source renewable energy equivalent to 50% of our annual electricity usage by 2025 and 100% by 2030. We also have a science-based target to reduce our operational emissions by 53% (over a 2019 baseline) by 2030. We are upgrading and hardening our infrastructure to be prepared for a changing climate, improving energy efficiency across our networks and facilities, making substantial investments in renewable energy and developing solutions to help our customers to reduce their carbon footprints. WeSeveral of our Directors have announced science-based emissions reduction targets for our Scope 1, 2 and 3 emissions and have set ambitious goals to source or generateexperience with climate-related issues, including renewable energy, equivalent to 50% of our total annual electricity consumption by 2025network resilience, innovative technological solutions and to achieve net zero operational emissions (Scope 1 and 2) by 2035. The Executive Climate Oversight Committee, composed of Verizon’s Chief Financial, Chief Administrative, Chief ESG and Chief Sustainability Officers, monitors Verizon’s progress on these initiatives and commitments and recommends changes or enhancements to our climate strategy. Representatives from the Strategy, Network, Fleet, Global Real Estate, Treasury, Sustainability and ESG organizations report to the committee on climate-related issues and initiatives that fall within their responsibilities. The Chief ESG Officer periodically updates the Corporate Governance and Policy Committee on the issues considered by the committee, the Company’s progress in meeting its climate-related commitments, and any significant developments relating to the Company’s strategy for managing climate-related risks.management.
Each committee of the Board oversees the management of the specific risks related to our environmental sustainability strategy and the transition to a low carbon economy that fall under the committee’s area of responsibility:
Audit Committee: Environmental and climate-related risks discussed during annual business risk reviews with the Audit Committee include operational and financial risks relating to energy management and our renewable energy and carbon neutral commitments, maintaining network reliability during catastrophic and weather-related events, and the impacts of possible laws or regulations that seek to mitigate climate change.
• | Audit Committee: Environmental and climate-related risks discussed during annual business risk reviews with the Audit Committee include operational and financial risks relating to energy management and our renewable energy and carbon neutral commitments, maintaining network reliability during catastrophic and weather-related events, and the impacts of possible laws or regulations that seek to mitigate climate change. |
Corporate Governance and Policy Committee: The Corporate Governance and Policy Committee oversees Verizon’s progress on meeting our environmental sustainability commitments.
• | Corporate Governance and Policy Committee: The Corporate Governance and Policy Committee oversees Verizon’s strategy for managing climate-related risks and monitors the Company’s progress on meeting climate-related goals. The Senior Vice President, Deputy General Counsel and Corporate Secretary regularly updates the Committee on the activities of Verizon’s Executive Climate Oversight Committee, a cross-functional management committee that has management oversight responsibility for Verizon’s climate-related strategy and initiatives. |
Finance Committee: The Finance Committee oversees the strategy for managing risks related to Verizon’s renewable energy exposure through renewable energy purchase agreements, as well as the Company’s green financing strategy.
• | Finance Committee: The Finance Committee oversees the strategy for managing risks related to Verizon’s renewable energy exposure through renewable energy purchase agreements, as well as the Company’s green financing program. |
• | Human Resources Committee: To incentivize management to achieve the Company’s climate-related goals, the Human Resources Committee has included a carbon intensity reduction metric as one of the performance measures in the Short-Term Incentive Plan (Short-Term Plan) since 2014. |
Human Resources Committee: To motivate management to be good stewards of our planet and reduce the environmental impact of our operations, the Human Resources Committee has included a carbon intensity reduction target as one of the performance measures in the Short-Term Incentive Plan (Short-Term Plan) since 2014.
Data privacy and cybersecurity. Protecting the privacy of our customers’ information and the security of our systems and networks has long been and will continue to be a priority at Verizon. The Board is committed to maintaining strong and meaningful privacy and security protections for our customers’ information. The Audit Committee has primary responsibility for overseeing Verizon’s risk management programs relating to data protection and privacy and cybersecurity. The Audit Committee also monitors Verizon’s compliance in the areas of data protection and privacy.
Data protection and privacy. Verizon has technical, administrative and physical safeguards in place to help protect against unauthorized access to, use or disclosure of customer information and data we collect and store. Verizon has a dedicated Chief Privacy Officer whose team advises the business on privacy risks and assesses the effectiveness of privacy controls. The Chief Privacy Officer annually briefs the Audit Committee on data privacy risks and mitigating actions.
• | Data protection and privacy. Verizon has technical, administrative and physical safeguards in place to help protect against unauthorized access to, use or disclosure of customer information and data we collect and store. Verizon has a dedicated Chief Privacy Officer whose team advises the business on privacy risks and assesses the effectiveness of privacy controls. The Chief Privacy Officer at least annually briefs the Audit Committee on data privacy risks and mitigating actions. |
Cybersecurity. To more effectively address the cybersecurity threats posed today, Verizon has a dedicated Chief Information Security Officer whose team is responsible for leading enterprise-wide information security strategy, policy, standards, architecture and processes. Verizon’s comprehensive information security program includes, among other aspects, vulnerability management, antivirus and malware protection, file integrity monitoring, encryption and access control. The Chief Information Security Officer leads an annual review and discussion with the full Board dedicated to Verizon’s cyber risks and threats and cyber protections and provides updates throughout the year, as warranted.
• | Cybersecurity. To more effectively address the cybersecurity threats posed today, Verizon has a dedicated Chief Information Security Officer whose team is responsible for leading enterprise-wide information security strategy, policy, standards, architecture and processes. Verizon’s comprehensive information security program includes, among other aspects, cyber defense including incident response and resiliency planning and testing, product and platform security, cyber architecture and engineering, identity and access management, and risk assessment and management including third party oversight. The Chief Information Security Officer leads an annual review and discussion with the full Board dedicated to Verizon’s cyber risks and threats and cyber protections and provides updates throughout the year, as warranted. In addition, the Audit Committee receives regular updates from senior management on the Company’s cybersecurity posture and related matters. |
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Responsible business. Verizon’s Responsible Business Council, chaired by the CEO and composed of members of the senior leadership team, oversees the integration of responsible practices as a core operating principle. At least annually, the Chief Corporate Social Responsibility Officer reports to the Board on the Council’s activities and Verizon’s community and social impact initiatives.
Current policy issues and corporate reputation. Companies in our industry and beyond are facing challenges that have impacted their reputations and brought adverse attention and action by consumers, regulators and shareholders. The Corporate Governance and Policy Committee has primary responsibility for overseeing the Company’s handling of business and reputational risks relating to Verizon’s position and engagement on important public policy issues, as well as individual events and incidents that may affect the Company’s business and reputation. Each year, Verizon’s Chief Administrative, Legal and Public Policy Officer updates the Committee on the current policy issues facing the Company that may generate publicity and impact corporate reputation. Through this annual briefing, the Committee reviews and discusses with management the most pressing known reputational issues and the Company’s position on each issue, as well as the processes in place to anticipate potential developments in each of the identified areas and to quickly respond to any such developments in a timely manner. Outside the regular meeting cycle, management makes sure thatinforms the Board is informed of current developments that may pose reputational risks to the industry or the Company.
Political activities and lobbying. Verizon adheres to the highest ethical standards when engaging in any political activity. Our political activity, including lobbying, is overseen by theThe Corporate Governance and Policy Committee whichoversees our political activity, including lobbying, and receives a comprehensive briefing from the Chief Administrative, Legal andSenior Vice President of Public Policy Officerand Government Affairs on these activities at least annually. Moreover, Verizon’s political activity is subject to robust internal controls. The Code of Conduct requires that all lobbying activities on behalf of Verizon be authorized by public policy or legal personnel. Corporate policy and training materials provide guidance to employees regarding legal requirements in connection with lobbying activities.
Verizon understands that transparency regarding our political activity is critical to maintaining the trust of our stakeholders. We publish a political engagement report on our corporate website that is updated twice a year thatand lists all political action committee contributions and corporate political contributions. Our report also discloses our Public Policy and Government Affairs organization’s memberships in trade associations and issue advocacy organizations for which our support exceedsreaches at least $50,000 annually. Verizon supports these organizations for a number of reasons, including to reflect our interest in the community, to acquire valuable industry and market expertise, and to support specific strategic policy and business goals and interests. These groups often have a diversity of members, interests and viewpoints that do not necessarily reflect Verizon’s beliefs or priorities and we may not always agree with all of the positions of each organization or its members. When we disagree with a position of an organization we support, we communicate our concerns through the senior executives who interact with these organizations. Verizon also takes these differences under consideration when determining whether support of an organization is, on balance, in the best interests of the Company and its stakeholders.
Human rights. As expressed in its Human Rights Statement, Verizon is committed to operating with respect for internationally recognized human rights. We have a dedicated Business and Human Rights Program that works to embed human rights considerations into responsible business decision-making processes across the Company. Our human rights efforts are overseen by theThe Corporate Governance and Policy Committee.Committee oversees our human rights work.
Anti-corruption. Verizon has a robust anticorruptionanti-corruption program to comply with applicable anticorruptionanti-corruption rules, including the Foreign Corrupt Practices Act and the U.K. Bribery Act. As part of this program, the Audit Committee receives annual reports summarizing the Company’s continued compliance with applicable anticorruption rules.anti-corruption rules on a Company-wide basis and within the various business units and corporate functions. Every two years, we review and assess our anti-corruption program with the goal of finding areas for improvement. This process is done under the direction of our Chief Compliance Officer, who reports the findings to the Audit Committee.
Oversight of human capital management
OversightThe Human Resources Committee is charged with oversight of our strategies, initiatives and programs related to human capital management, including culture andwith respect to employee engagement, diversity, equity and inclusion, and talent acquisition, retention and development, historically has been conducted byemployee engagement, pay equity and corporate culture. In addition, the full Board as well as the Human Resources Committee. In 2021, the Board amended the Human Resources Committee Charter to expressly delegate to the Committee oversight responsibilities in relation to human capital management.periodically discusses these topics.
Culture and employee engagement. Our Board views our employees as one of Verizon’s most critical assets and regularly receives briefings from the CEO on initiatives to strengthen our company culture and encourage employee engagement. The CEO reviews with the Board the results of the “Pulse” surveys completed by employees across the Company. Periodically, our Directors attend employee town halls and participate in leadership forums with employees.
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Diversity, equity and inclusion. Verizon is committed to creating a collaborative, inclusive, equitable and diverse environment – within Verizon, with our customers and among our business partners and suppliers. The Board views this commitment as a business imperative and a competitive advantage. To promote diversity in our workforce and encourage the contribution of diverse business partners to our success, the Human Resources Committee has included diversity targets as performance measures in the Short-Term Plan for over 20 years. The Chief Human Resources Officer reviews diversity representation and initiatives with the Committee at least annually. Additionally, the Corporate Governance and Policy Committee regularly reviews and discusses Board diversity matters. The Finance Committee also receives regular updates from our Senior Vice President and Treasurer about the Company’s efforts to foster diversity, equity and inclusion in the capital markets through our financing activities.
Succession planning and talent development. Our Board recognizes that one of its most important duties is to promote continuity in Verizon’s senior leadership by overseeing the development of executive talent and planning for the efficient succession of the CEO. Our Board has delegated primary oversight responsibility for succession planning to the Human Resources Committee, which oversees assignments to key leadership positions. The Human Resources Committee reports on its activities to the full Board, which addresses succession planning during executive sessions that typically occur in connection with each regularly scheduled meeting.
To align the succession planning and management development process with Verizon’s strategic objectives, the Board and Human Resources Committee regularly consult with the CEO on Verizon’s organizational needs and competitive challenges, the potential of key managers, and plans for future developments and emergency situations. As part of this process, the Board and the Human Resources Committee also seek input from the Chief Human Resources Officer, as well as advice on related compensation issues from the Human Resources Committee’s independent compensation consultant.
Our Board generally conducts an in-depth review of senior leader development and succession planning at least twice a year. Led by the CEO and the Chief Human Resources Officer, this review addresses Verizon’s management development initiatives, assesses senior management resources, and identifies individuals who should be considered as potential future senior executives.
Our goal is to develop well-rounded, experienced and diverse senior leaders. High potential executives are challenged regularly with additional responsibilities, new positions or promotions to expose them to our diverse operations. These individuals are often positioned to interact more frequently with the Board, both in full Board meetings and in less formal settings and small groups, so the Directors can get to know and assess them.
Employee health and safety. Verizon is committed to maintaining a safe workplace and environmentally responsible work practices, and we expect our suppliers to share that commitment. At least annually, the Chief Human Resources Officer briefs the Human Resources Committee on the Company’s health and safety protocols, incidents involving employees and suppliers, and actions that management is taking to limit these risks.
Compensation risk. The Human Resources Committee considers the impact of our executive compensation program and the incentives created by compensation awards on Verizon’s overall risk profile. It also oversees management’s annual assessment of compensation risk arising from Verizon’s compensation policies and practices. This annual assessment is conducted by members of management including the Senior Vice President of Internal Audit and the Corporate Secretary. The assessment includes a review of the features and characteristics of Verizon’s compensation policies and programs, the performance metrics under the Short- and Long-Term Incentive Plans and the process for calculating and approving adjustments that are part of the plan, as well as the approval processes for compensation programs and related payouts. The assessment also reviews governance oversight at the Committee and Board level, Code of Conduct provisions and mandatory training programs that reinforce policies that mitigate risk, and performance metrics and measurement periods that are aligned with Verizon’s business strategy.
Based on management’s review, Verizon has concluded that our compensation policies and procedures are not reasonably likely to have a material adverse effect on Verizon because they are appropriately structured and discourage employees from taking excessive risks.
Business conduct and ethics. We are committed to operating with the highest level of integrity, responsibility and accountability. To that end, we have adopted a Code of Conduct that applies to all employees, including the CEO, the Chief Financial Officer and the Controller. The Code of Conduct describes each employee’s responsibility to conduct business with the highest ethical standards and provides guidance about preventing, reporting and remediating potential compliance violations in key areas. Verizon thoroughly investigates all claims of misconduct. Various types of cases are reported to the Chief Compliance Officer, who discusses the most serious Code violations with the Audit Committee at least annually.
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Directors are expected to act in the spirit of the Code of Conduct, and to comply with the specific ethical provisions of the Corporate Governance Guidelines. Our Board is strongly predisposed not to waive any of these business conduct and ethics provisions for executive officerssenior executives or Directors. In the unlikely event of a waiver, we will promptly disclose the Board’s action on our website.
Related person transactions. The Board has adopted the Related Person Transaction Policy that is included in the Corporate Governance Guidelines. The Corporate Governance and Policy Committee reviews transactions between Verizon and any of our Directors or executive officers or members of their immediate families to determine if any participants have a material interest in the transaction. If the Committee determines that a material interest exists, based on the facts and circumstances of each case, the Committee may approve, disapprove, ratify or cancel the transaction or recommend another course of action. Any Committee members who are involved in a transaction under review do not participate in the Committee’s deliberations. During 2021,2022, there were no related person transactions required to be disclosed in this proxy statement.
Our approach to shareholder engagement
We believe that a robust shareholder outreach program is an essential component of maintaining our strong corporate governance practices. Ongoing communication with our investors helps our Board and senior management gather useful feedback on a wide range of topics. In our discussions with investors, we seek their input on a variety of corporate governance, compensation and ESG topics that may impact our business or reputation. We strive for a collaborative approach with investors to solicit and understand a variety of perspectives. These engagements include the participation of our independent Lead Director, Clarence Otis, Jr., or other Directors, when requested and appropriate. Shareholder feedback is regularly summarized and shared with our Board.
In 2021,2022, topics covered in engagement included:
Environmental
• Climate change
• Network reliability and resilience • Biodiversity |
| Social
• Cybersecurity
• Digital inclusion
• Human capital, including diversity, equity and inclusion • Labor management
• Supply chain |
| Governance
• Board diversity and skills
• Business ethics
• Executive compensation
• Human rights
• Political engagement • Risk management |
| Disclosure
•
• Human capital metrics
• • SASB industry standard • TCFD |
In addition to our regular shareholder engagement, in 2021, our Chief Financial Officer and our Corporate Secretary participated in calls with key investors to discuss our growth strategy and its relationship to our Board composition and refreshment plans. Our Chief Financial Officer also hosted a special engagement event focused on climate featuring senior leaders from the Network, Supply Chain, Treasury and ESG organizations for our 50 largest investors.
Also in 2021, our Lead Director, Clarence Otis, Jr., discusseddiscusses corporate purpose, decisions about when to speak on social issues, Board oversight of human capital management, and Board composition and refreshment in a video on the Corporate Governance section of our website at www.verizon.com/about/investors/corporate-governance.
Verizon’s dedicated ESG team focuses on stakeholder engagement and decision-useful reporting in strategic areas including governance, human rights, environmental sustainability and digital trust and safety and also oversees Verizon’s efforts to deliver on its ESG commitments. Over the past two years, in response to feedback from our investors, we have aligned ourOur ESG reporting is aligned with the Sustainability Accounting Standards Board standardsSASB Standard for the telecommunications industry, and the recommendations of the Task Force on Climate-Related Financial Disclosures.Disclosures, the Global Reporting Initiative and U.N. Global Compact. We strive to make it easy for shareholders to learn about our positions and progress on the issues that matter to them. To that end, we have created an ESG Resources Hub on our Investor Relations website at www.verizon.com/about/investors/reporting that houses all of our ESG reporting and policies.
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
2021 annual ESG reporting cycle
Communicating with our Directors
Our Board of Directors believes that communication with shareholders and other interested parties is an important part of the governance process, and has adopted the following procedure to facilitate this communication.
How to contact the Board
Any shareholder or interested party may communicate directly with our Board, any committee of our Board, any individual Director (including the Lead Director and the committee chairs) or the non-employee Directors as a group, by writing to:
Verizon Communications Inc.
Board of Directors
(or committee name, individual Director, Lead
Director, committee chair or non-employee
Directors as a group, as appropriate)
1095 Avenue of the Americas
New York, New York 10036
Verizon’s Corporate Secretary reviews all correspondence addressed to our Directors and periodically provides the Board with copies of all communications that deal with the functions of our Board or its committees, or that otherwise require Board attention. Typically the Corporate Secretary will not forward communications that are of a personal nature or are unrelated to the duties and responsibilities of our Board, including business solicitations or advertisements, mass mailings, job-related inquiries, or other unsuitable communications. All communications involving substantive accounting or auditing matters are forwarded to the Chair of the Audit Committee.
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Verizon 20222023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Non-employee Director compensation
The Human Resources Committee, in consultation with its independent compensation consultant, reviews and recommends non-employee Director compensation. In 2021,2022, each non-employee Director of Verizon was entitled to an annual cash payment of $125,000. The Chairs of the Corporate Governance and Policy Committee and the Finance Committee were entitled to receive an additional annual cash payment of $20,000, and the Chairs of the Audit Committee and the Human Resources Committee were entitled to receive an additional annual cash payment of $30,000. The Lead Director was entitled to an additional annual cash payment of $50,000. Directors who served in each of these roles for less than a full year received a portion of the annual payment commensurate with their service.
In 2021,2022, each non-employee Director also received a grant of Verizon share equivalents valued at $175,000 on the grant date. No meeting fees were paid if a non-employee Director attended a Board or committee meeting on the day before or the day of a regularly scheduled Board meeting. Each non-employee Director who attended a Board or committee meeting held on any other date received a meeting fee of $2,000.
Each non-employee Director who joinsjoined our Board receivesin 2022 was entitled to receive a one-time grant of 3,000 Verizon share equivalents valued at the closing price on the date the new Director joinsjoined our Board. Ms. ToméMr. Colao did not receive such a grant upon joining the Board in 2021,2022, because shehe previously received one in 2019 in connection with herhis prior service on the Board.
Based on the recommendation of the Human Resources Committee after its review of the Verizon Director compensation program and the programs of peer companies, and in consultation with its independent compensation consultant, the Board in 2020.made the following changes to the Director compensation program that are effective January 2023: (i) eliminated the $2,000 meeting fees received by non-employee Directors for attending Board or committee meetings held on days other than the day before or the day of a regularly scheduled Board meeting, (ii) eliminated the one-time grant of 3,000 Verizon share equivalents upon joining the Board, (iii) increased the value of the annual grant of Verizon share equivalents from $175,000 to $210,000, and (iv) increased the additional cash payment to the Lead Director from $50,000 to $75,000. The Board also increased the stock ownership requirement for Directors to five times the annual cash component of the annual Board retainer within 4 years of joining the Board (up from three times within 3 years of joining the Board).
All share equivalents that non-employee Directors receive are automatically credited to the Director’s deferred compensation account under the Verizon Executive Deferral Plan, which is referred to as the Deferral Plan, and invested in a hypothetical Verizon stock fund. Amounts in a Director’s deferred compensation account are paid in a cash lump sum in the year following the year the Director leaves our Board.
Non-employee Directors may choose to defer all or part of their annual cash payment and meeting fees (if any) under the Deferral Plan. They may elect to invest these amounts in the hypothetical investment options available to participants in Verizon’s Management Savings Plan or in a hypothetical cash account that earns a return rate equal to the long-term, high-grade corporate bond yield average as published by Moody’s Investor Services.
The non-employee Directors are eligible to participate in the Verizon Foundation Matching Gifts Program. Under this program, which is open to all Verizon employees, the Foundation matches up to $5,000 per year of charitable contributions to accredited colleges and universities, $1,000 per year of charitable contributions to any non-profit with 501(c)(3) status, and $1,000 per year of charitable donations to designated disaster relief campaigns.
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Verizon 2023 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Non-employee Director compensation in 20212022
Name (a) | Fees earned or paid in cash1 ($) (b) | Stock awards2 ($) (c) | Option awards ($) (d) | Non-equity incentive plan compensation ($) (e) | Change in pension value and nonqualified deferred compensation earnings ($) (f) | All other compensation ($) (g) | Total ($) (h) | Fees earned or paid in cash1 ($) (b) | Stock awards2 ($) (c) | Option awards ($) (d) | Non-equity incentive plan compensation ($) (e) | Change in pension value and nonqualified deferred compensation earnings ($) (f) | All other compensation ($) (g) | Total ($) (h) | ||||||||||||||||||||||||||||||||||||||||||
Shellye Archambeau* | 161,000 | 175,000 | 0 | 0 | 0 | 0 | 336,000 | 153,000 | 175,000 | 0 | 0 | 0 | 0 | 328,000 | ||||||||||||||||||||||||||||||||||||||||||
Roxanne Austin | 145,000 | 175,000 | 0 | 0 | 0 | 0 | 320,000 | 141,000 | 175,000 | 0 | 0 | 0 | 0 | 316,000 | ||||||||||||||||||||||||||||||||||||||||||
Mark Bertolini* | 157,000 | 175,000 | 0 | 0 | 0 | 0 | 332,000 | 157,000 | 175,000 | 0 | 0 | 0 | 0 | 332,000 | ||||||||||||||||||||||||||||||||||||||||||
Vittorio Colao+ | 33,250 | 0 | 0 | 0 | 0 | 0 | 33,250 | |||||||||||||||||||||||||||||||||||||||||||||||||
Vittorio Colao | 20,833 | 29,167 | 0 | 0 | 0 | 0 | 50,000 | |||||||||||||||||||||||||||||||||||||||||||||||||
Melanie Healey | 133,000 | 175,000 | 0 | 0 | 0 | 0 | 308,000 | 127,000 | 175,000 | 0 | 0 | 0 | 0 | 302,000 | ||||||||||||||||||||||||||||||||||||||||||
Laxman Narasimhan | 62,500 | 256,370 | 0 | 0 | 0 | 0 | 318,870 | 135,000 | 175,000 | 0 | 0 | 0 | 0 | 310,000 | ||||||||||||||||||||||||||||||||||||||||||
Clarence Otis, Jr.** | 195,000 | 175,000 | 0 | 0 | 0 | 0 | 370,000 | 195,000 | 175,000 | 0 | 0 | 0 | 0 | 370,000 | ||||||||||||||||||||||||||||||||||||||||||
Daniel Schulman* | 161,000 | 175,000 | 0 | 0 | 0 | 0 | 336,000 | 159,000 | 175,000 | 0 | 0 | 0 | 0 | 334,000 | ||||||||||||||||||||||||||||||||||||||||||
Rodney Slater | 133,000 | 175,000 | 0 | 0 | 0 | 0 | 308,000 | 129,000 | 175,000 | 0 | 0 | 0 | 0 | 304,000 | ||||||||||||||||||||||||||||||||||||||||||
Carol Tomé | 43,667 | 58,333 | 0 | 0 | 0 | 0 | 102,000 | 131,000 | 175,000 | 0 | 0 | 0 | 0 | 306,000 | ||||||||||||||||||||||||||||||||||||||||||
Gregory Weaver* | 175,000 | 175,000 | 0 | 0 | 0 | 0 | 350,000 | 175,000 | 175,000 | 0 | 0 | 0 | 0 | 350,000 |
* | Denotes a chair of a standing committee during |
** | Mr. Otis served as Lead Director during |
|
1 | This column includes all fees earned in |
2 | For each non-employee Director, this column reflects the grant date fair value of the non-employee Director’s |
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compensation
Item 2: Advisory vote to approve executive compensation
Shareholders have strongly supported Verizon’s executive compensation program since our first annual advisory vote on the matter in 2009. We are asking you to vote in favor of the following non-binding resolution:
“Resolved, that the shareholders approve, on an advisory basis, the compensation of the named executive officers, as disclosed in Verizon’s proxy statement for the 20222023 Annual Meeting of Shareholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the Compensation Tables and the related narrative discussion.”
The structure of our executive compensation program for 20212022 is similar to prior years, with updates to address changes in our business unit structure and strategic emphasis. Our Board recommends a vote FOR this resolution because the Board believes our program effectively:
Encourages strong short-term and long-term performance;
Aligns the executives’ long-term interests with those of our shareholders; and
Retains high-performing executives.
In the Compensation Discussion and Analysis and Compensation Tables beginning on page 23,25, we provide a detailed description of our executive compensation program, including our philosophy, the elements of our program and the compensation of our named executive officers. We encourage you to read these sections before deciding how to vote on this proposal.
This advisory resolution, commonly known as a “say-on-pay” resolution, is not binding on our Board of Directors. Nevertheless, the Board and the Human Resources Committee value shareholder feedback received through this annual say-on-pay vote and our direct investor outreach program. The voting results and direct shareholder input are carefully reviewed and considered and are an important part of the process for evaluating our executive compensation program.
The Board of Directors recommends that you vote FOR this proposal. |
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Item 3: Advisory vote on the frequency of future advisory votes to approve executive compensation
As required by SEC rules, we are asking shareholders to vote on whether future advisory votes on executive compensation should occur every year, every two years or every three years.
In 2007, the Board adopted its current policy to include an advisory vote on executive compensation on the ballot at each annual meeting beginning in 2009. Consistent with this policy the Board recommends that shareholders vote in favor of holding future say-on-pay votes every year.
You may cast your vote on the following resolution by choosing one year, two years or three years, or you may abstain from voting:
“Resolved, that the shareholders of the Company determine, on an advisory basis, that the preferred frequency with which the shareholders of the Company shall have an advisory vote on the compensation of the Company’s named executive officers as set forth in the Company’s proxy statement is:
Option 1 – once every year;
Option 2 – once every two years;
Option 3 – once every three years; or
Option 4 – abstain from voting.”
This advisory resolution is not binding on our Board of Directors. Nevertheless, the Board will review and consider the voting results when making a determination as to the frequency of future say-on-pay votes.
| The Board of Directors recommends that you vote for conducting future advisory votes on executive compensation EVERY YEAR. |
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Compensation discussion and analysis
2022 Named executive officers
* | Mr. |
** | Mr. Malady |
*** | Mr. |
^ | Mr. Silliman served as Executive Vice President and Chief Administrative, Legal and Public Policy Officer until October 10, 2022, after which he began to transition into his current role. |
^^ | Ms. Erwin stepped down from her role as Executive Vice President and Group CEO — Verizon Business on July 1, 2022 and remained a strategic advisor to Mr. Vestberg until her separation from Verizon |
^^^ | Ms. Brouillette ceased to serve as Group |
Roles and responsibilities
Human Resources Committee. The Human Resources Committee of the Board of Directors oversees the design and implementation of the compensation program for our named executive officers, as well as Verizon’s management succession planning, talent development and human capital management initiatives, including with respect to employee diversity, equity and inclusion and pay equity. The CEO’s compensation is determined by the independent members of the Board after receiving the Committee’s recommendation. References to the Committee in this Compensation Discussion and Analysis with respect to the CEO’s compensation reflect that process.
Management. The Committee may consult with the Chief Human Resources Officer about the design, administration and operation of the compensation program. The Committee has delegated administrative responsibility for implementing its decisions on compensation and benefits matters to the Chief Human Resources Officer, who reports to the Committee on the actions taken under this delegation.
The Committee seeks the CEO’s views on whether the existing compensation policies and practices continue to support Verizon’s business and performance objectives, utilize appropriate performance targets, and appropriately reward the contributions of the other named executive officers. While the Committee values the CEO’s insight, ultimately the Committee makes an independent determination on all matters related to the compensation of the named executive officers.
Independent compensation consultant. The Committee has the sole authority to retain and terminate a compensation consultant and to approve all terms of the engagement, including fees. The Committee retained Semler Brossy Consulting Group, LLC as its compensation consultant (Consultant). The Consultant advises the Committee on all matters related to the compensation of our named executive officers and our non-employee Directors. The Consultant’s advisory services include providing current benchmarking data for our peer group and other relevant market data in our industry and helping the Committee interpret this data, as well as data provided by the Company. The Consultant participates in all Committee meetings and confers regularly with the Committee in executive session at those meetings.
Committee policy prohibits the Consultant from doing any work for the Company during its engagement, and the Consultant did not perform work for the Company in 2021.2022. The Committee made assessments of the Consultant under SEC rules and NYSE and Nasdaq listing standards and concluded that the Consultant was independent, and that its work in 20212022 for the Committee did not raise any conflicts of interest.
Shareholder feedback on compensation
Our Board, the Human Resources Committee and our management team value shareholder perspectives on our executive compensation program. Management and Directors engage with our institutional shareholders in meetings and calls throughout the year. Topics of discussion typically include the Committee’s choice of performance measures for awards issued under our Short- and Long-Term Incentive Plans, the relationship between the performance measures and our
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long-term strategy, the payout terms of equity awards, compensation recoupment policies and shareholder proposals, and our long-standing practice of including quantitative ESG performance measures in our Short-Term Plan. In addition to this direct feedback, as part of the Committee’s annual review of the executive compensation program, the Committee considers the outcome of Verizon’s annual shareholder advisory vote on executive compensation – the “say-on-pay.” At our Annual Meeting
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in May 2021,2022, the compensation of our named executive officers was approved by approximately 92%90% of votes cast. Based on the perspective obtained from discussions with our long-term shareholders, the results of our 2021 2022 say-on-pay vote, and the history of strong shareholder support in prior say-on-pay votes, the Committee believes our shareholders continue to strongly support Verizon’s executive compensation program.
Best practices in executive compensation and governance
Our compensation program reflects our commitment to industry-leading standards for compensation design and governance. The Human Resources Committee regularly reviews best practices in executive compensation and governance and revises our policies and practices when appropriate. The following table highlights some features of our executive compensation program that demonstrate the rigor of our policies.
What we do
| More information on page | |||
Pay for performance | Approximately 90% of named executive officers’ total compensation opportunity is variable, incentive-based pay. | |||
Focus on performance: Exclude buybacks from EPS results | Our adjusted earnings per share (EPS) metric under our Long-Term Incentive Plan (Long-Term Plan) excludes the benefit of any repurchases of Verizon’s common stock under a share buyback program. |
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Robust stock ownership guidelines | We have stock ownership guidelines for the CEO of 7x base salary; for other named executive officers of 4x base salary; and for Directors of |
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Shareholder outreach | Our outreach program gives institutional shareholders a regular opportunity to express their views about our executive compensation program and policies. Shareholder input is carefully considered by the Committee. | |||
Clawback policies | Our clawback policies give us the right to cancel or “claw back” incentive compensation from any senior executive who has engaged in misconduct that results in (i) significant reputational or financial harm to Verizon or (ii) a material financial restatement. |
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Anti-hedging policy | Our anti-hedging policy prohibits Directors and executives who receive equity-based incentive awards from entering into transactions designed to hedge or offset any decrease in the market value of Verizon stock that they own. |
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Annual compensation risk assessment | We perform a risk assessment of our compensation program every year. | 18 | ||
Independent compensation consultant | The Committee’s independent compensation consultant cannot do any work for the Company while it is engaged by the Committee. | |||
Double-trigger change in control | In the event of a change in control, our Long-Term Plan requires an involuntary termination without cause for any accelerated vesting of awards. |
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ESG metric | For over 20 years, our short-term incentive program has included an ESG metric. | |||
What we don’t do
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Tax gross-ups | We do not provide tax gross-ups to our executive officers or Directors. |
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Dividends on unearned performance awards | We do not pay dividends on unearned Performance Stock Units (PSUs) or Restricted Stock Units (RSUs). |
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Employment contracts | None of our named executive officers has an employment contract. |
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Guaranteed benefits | Over 15 years ago, we froze our defined benefit pension and supplemental executive retirement benefits. |
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Benchmarking total compensation opportunity
The Committee evaluates whether the compensation opportunities for our executives are appropriate and competitive by comparing each named executive officer’s total compensation opportunity – which represents the sum of the executive’s base salary and target award amounts under the Short-Term Plan and the Long-Term Plan – to the total compensation opportunities for executives in comparable positions at peer companies, referencing the 50th percentile when making this comparison. A named executive officer’s total compensation opportunity may be higher or lower depending upon the executive’s tenure and overall level of responsibility.
The peer groups utilized for compensation benchmarking are reviewed each year. For 20212022 compensation decisions, the Committee utilized a peer group that consisted of the companies in the Dow Jones Industrial (Dow) Average (other than Verizon) with at least $50 billion in annual revenue, plus Verizon’s four largest industry competitors (AT&T, Charter Communications, Comcast and T-Mobile US) and four large market-cap technology companies (Alphabet, Amazon, Meta Platforms and Netflix) that are not included in the Dow. The inclusion ofDow, whose applications rely heavily on our network and technology. This is the four additional technology companies in thesame peer group selection criteria utilized for 2021 compensation decisions represented a change to the peer group used for 2020 compensation decisions, which was comprised of the companies (other than Verizon) in the Dow with at least $50 billion in annual revenue, plus Verizon’s five largest industry competitors that were not included in the Dow (AT&T, Charter Communications, Comcast, Sprint Corporation and T-Mobile US). The Committee determined that increasing an emphasis on technology companies in our peer group would better reflect the companies we compete with for executive talent, while maintaining a robust number of peer companies for comparison purposes and providing clarity and transparency for shareholders.decisions.
Below are the companies included in the Company’s peer group for 20212022 compensation purposes.
Alphabet Amazon Apple AT&T Boeing Caterpillar Charter Communications Chevron
| Comcast Dow Inc. Goldman Sachs Home Depot IBM Intel Johnson & Johnson JPMorgan Chase Meta Platforms | Microsoft Netflix | Procter & Gamble T-Mobile US UnitedHealth Group Walgreens Boots Alliance Walmart Walt Disney |
Compensation objectives and elements of compensation
Compensation objectives
Verizon’s executive compensation program supports the creation of shareholder value by pursuing four key objectives:
Attract and retain high-performing executives with the leadership abilities and experience necessary to drive our customer-focused transformation of the digital market,
• | Attract and retain high-performing executives with the leadership abilities and experience necessary to drive our customer-focused, technology enabled strategy, within an enterprise of our scale, breadth and complexity;
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• | Drive performance and create shareholder value by emphasizing variable, at-risk compensation with an appropriate balance of short-term and long-term objectives that align executive and shareholder interests; and |
• | Manage risk through oversight and compensation design features, policies and practices that strike an appropriate balance between risk and reward. |
Elements and mix of compensation to emphasize long-term performance
The Committee determines the appropriate balance between fixed and variable pay elements, short- and long-term pay elements, and cash and equity-based pay elements when setting total compensation opportunities at competitive levels.
Pay element | Characteristics | Purpose | ||
Base salary | Annual fixed cash compensation | Attract and retain high-performing and experienced executives | ||
Short-term incentive opportunity | Annual variable cash compensation based on the achievement of predetermined annual performance measures | Motivate executives to achieve short-term performance goals that will establish the foundation for future growth | ||
Long-term incentive opportunity | Long-term variable equity awards granted annually as a combination of performance-based stock units and time-based restricted stock units | Align executives’ interests with those of shareholders, encourage efforts to grow long-term value, and retain executives |
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The Committee believes that a substantial majority of each named executive officer’s total compensation opportunity should be variable and at risk in order to emphasize a performance-based culture. Moreover, since the annual Long-Term Plan awards feature three-year award cycles, with awards consisting of PSUs subject to both performance-based and time-based vesting requirements and RSUs subject to time-based vesting requirements, we reward sustained performance and also encourage high-performing executives to remain with Verizon.
The following chart illustrates the approximate allocation of the named executive officers’ 20212022 total compensation opportunity between variable, performance-based elements and fixed pay.
20212022 total compensation pay mix
In establishing the mix of incentive pay for the named executive officers, the Committee balances the importance of meeting Verizon’s short-term business goals with the need to create shareholder value over the longer term. The Committee also considered market data with respect to the mix of annual cash and long-term equity components for similarly situated executives among the peer group. Based on its review, the Committee established long-term target compensation opportunities at levels more than double the annual base salary and short-term incentive target compensation opportunities of the named executive officers.
Performance target setting
The Committee takes a holistic approach to establishing performance targets under our incentive plans and ensuring that they are aligned with Verizon’s short- and long-term strategic goals. In establishing performance targets, the Committee recognizes the importance of achieving an appropriate balance between rewarding executives for strong performance over both the short- and long-term and establishing realistic goals that continue to motivate and retain executives. As a result, our Short-Term and Long-Term Plans provide for measurable, rigorous performance targets that are attainable, but challenge executives to drive business results that generate shareholder value.
In setting the performance targets, the Committee considered the following factors:
Verizon’s short- and long-term strategy;
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Economic, industry and competitive environments;
The creation of shareholder value;
The achievement level against performance targets in the prior year;
Financial analysts’ consensus estimates for the performance measures over future performance cycles;
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The correlation among the performance measures and considerations of how Verizon’s operational performance will affect each measure differently; and
With regard to the ESG metrics in the Short-Term Plan, Verizon’s commitments to reduce its environmental impact and promote diversity in its workforce and among its business partners.
2021
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2022 annual base salary
To determine an executive’s base salary, the Committee, with assistance from the Consultant, considers the pay practices of the peer group for comparable positions; the executive’s experience, tenure, scope of responsibility and performance; internal pay alignment; continuity planning and management development considerations; and for newly-hired executives, the Committee also considers the compensation required to attract the executive to the Company. There is no specific weighting applied to any of these factors in setting annual salaries, and the process ultimately relies on the subjective exercise of the Committee’s judgment. Taking
The Committee took these considerations into account these considerations,in making the following base salary determinations for Mr. Malady, Mr. Sampath, and Ms. Brouillette. The Committee approved a 2022 base salary of $900,000 for Mr. Malady (an increase of 5.88% from his 2021 base salary). Mr. Sampath received a base salary increase in 2022 of 3.57% in his prior role at Verizon. When Mr. Sampath was promoted to Executive Vice President and Group CEO – Verizon Business in July 2022, the Committee approved 2021a new base salary increases of 5% for Mr. Dunne, 11.76% for$850,000, which reflects the scope and breadth of his new position. Ms. ErwinBrouillette’s base salary was increased to $950,000 effective January 1, 2022, the date that Ms. Brouillette assumed the position of Executive Vice President and 6.25% for Mr. Malady.Group CEO – Verizon Consumer. Messrs. Vestberg, Ellis and GowrappanSilliman and Ms. Erwin did not receive a base salary increase in 2021.2022.
20212022 short-term incentive compensation
The Verizon Short-Term Plan motivates executives to achieve challenging short-term performance targets in order to provide the foundation for future growth. Each year, the Committee establishes the potential value of the awards under the Short-Term Plan, as well as the performance targets required to achieve these awards.
When determining the Short-Term Plan design for the 2022 plan year, the Committee took into consideration the interdependent nature of Verizon’s three operating units – Consumer, Business and Global Network and Technology (GN&T) – in delivering on Verizon’s strategic priorities of launching C-Band spectrum, expanding 5G coverage and executing on our multi-purpose network strategy, the desire to maintain qualitative strategic leading indicators, and competitive market pay and market practices. As a result, the Committee made the following key changes to the Short-Term Plan for the 2022 plan year:
Established a single set of performance metrics at the Verizon corporate level, based on Verizon’s consolidated results, that apply to all executives to accelerate and focus on delivering on Verizon’s strategic priorities.
Maintained the same three financial performance metrics – service and other revenue, cash flow from operations and adjusted operating income – but increased the weight of the service and other revenue metric to further enhance focus on revenue growth and weighted the cash flow from operations and adjusted operating income metrics equally.
Retained qualitative leading indicators for each of the units and added an overarching Verizon leading indicator, which apply as modifiers to the payout percentage to focus individual leaders on annual strategic initiatives that lay the groundwork for long-term growth.
The Committee set the values of the 20212022 Short-Term Plan award opportunities as a percentage of an executive’s base salary based on both the scope of the executive’s responsibilities and the competitive pay practices of the peer group used for benchmarking our executives’ total compensation opportunity. The Short-Term Plan award opportunities at the threshold, target and maximum levels for each of the named executive officers are shown in the grantsGrants of plan-based awardsPlan-based Awards table on page 42.44.
For the named executive officers, other than Mr. Sampath, target award opportunities, expressed as a percentage of base salary, did not change for 2021.2022. However, the dollar value of the 20212022 target award opportunity for Mr. Dunne, Ms. ErwinBrouillette and Mr. Malady increased from 20202021 as a result of the base salary increases described above. Messrs. Vestberg, Ellis and Silliman and Ms. Erwin did not receive a salary increase in 2022, so the dollar value of their respective 2022 target award opportunities was the same as it was in 2021. When Mr. Sampath was promoted to Executive Vice President and Group CEO – Verizon Business in July 2022, his target award opportunity was increased from 90% to 150% of his base salary on a prorated basis. The dollar value in the 2022 Short-Term Plan Target Award Opportunity table below reflects this increase.
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The following table shows the 20212022 Short-Term Plan target award opportunity for each of the named executive officers.
20212022 Short-Term Plan target award opportunity
Named executive officer | As a percentage of base salary | As a dollar value | As a percentage of base salary | As a dollar value | ||||||||||||
Mr. Vestberg | 250% | $3,750,000 | 250% | $3,750,000 | ||||||||||||
Mr. Ellis | 150% | $1,425,000 | 150% | $1,425,000 | ||||||||||||
Mr. Dunne | 150% | $1,575,000 | ||||||||||||||
Ms. Erwin | 150% | $1,425,000 | ||||||||||||||
Mr. Malady | 150% | $1,275,000 | 150% | $1,350,000 | ||||||||||||
Mr. Gowrappan* | 150% | $1,275,000 | ||||||||||||||
Mr. Sampath* | 150% | $ 963,750 | ||||||||||||||
Mr. Silliman | 150% | $1,275,000 | ||||||||||||||
Ms. Erwin** | 150% | $1,425,000 | ||||||||||||||
Ms. Brouillette | 150% | $1,425,000 |
* |
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** | In connection with Ms. Erwin’s involuntary separation from Verizon in September |
Annual performance measures
In February 2021,2022, the Committee established the performance measures and targets for the 20212022 Short-Term Plan. The Committee established financial, operational and ESG performance measures and targets at the Verizon corporate level, based on Verizon’s consolidated results, that apply to all executives under the plan and established additional financial and operational performance measures and targets and qualitative leading indicators that applied to executives inat the Verizon corporate level and at each of the Company’s operating units – the Business Group, Consumer Group, Global Network and Technology (GN&T) Group and Media Group. The Short-Term Plan award opportunity for Messrs. Vestberg and Ellis was determined solely by the
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Company’s achievement against the Verizon corporate performance measures. Fifty-percent of the Short-Term Plan opportunity for Mr. Dunne, Ms. Erwin and Mr. Malady was determined by the Company’s achievement against the Verizon corporate performance measures, and 50% was determined by the achievement of the financial and operational performance measures and qualitative leading indicators established for the respective unit that each leads.units. For each performance measure, the Committee set a target that challenges executives to drive business results that generate shareholder value. Verizon’s performance with respect to these applicable measures determines the amount of the short-term incentive awards earned by the named executive officers. Mr. Gowrappan was not eligible
The following graphic illustrates how the adjusted company results related to receive athe performance measures and the leading indicator modifiers result in the final Short-Term Plan award from Verizon for 2021 as a result of his separation from Verizon and continued employment with the Media Group business upon the sale of the Media Group business to affiliates of Apollo in September 2021 (Media Group Sale).award.
The 20212022 performance measures, along with the weighting ascribed to each, are shown below as a percentage of the total Short-Term Plan award opportunity at target level performance. The Committee believes that these performance measures are appropriate to motivate Verizon’s executives to achieve outstanding short-term results and, at the same time, help establish the foundation for long-term value for shareholders. The 20212022 measures and related targets approved by the Committee are described in detail below. The Committee did not make any modifications to the 2021 measures and targets due to COVID-19.
2021 Short-Term Plan performance measures and weightings
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2022 Short-Term Plan performance measures and weightings
Why these performance measures?
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