Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934 (Amendment No. )

☑Filed by the Registrant☐Filed by a Partyparty other than the Registrant     

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☑Definitive Proxy Statement
☐ Definitive Additional Materials
☐Soliciting Material Under Rule 14a-12under §240.14a-12

United Parcel Service, Inc.

(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if Other Thanother than the Registrant)

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Table of Contents

Notice of 2022 Annual Meeting
of Shareowners and Proxy Statement

Thursday, May 5, 2022
8:00 a.m. Eastern Time

www.virtualshareholdermeeting.com/UPS2022

Notice of 2019 Annual Meeting
of Shareowners and
Proxy Statement


Thursday, May 9, 2019
8:00 a.m. Eastern Time


Hotel du Pont
Wilmington, Delaware


Table of Contents

Table of Contents

Board Chair Letter to Our Shareowners     4
Notice of UPS 2019 Annual Meeting5
Proxy Statement Summary6
Corporate Governance10
Selecting Director Nominees10
Board Diversity11
Board Refreshment and Succession Planning11
Director Independence1211
Board Leadership Structure12
Executive Sessions of Independent Directors1312
Board and Committee Evaluations1312
Majority Voting and Director Resignation Policy1413
Risk Oversight14
Strategic Planning and Oversight1514
Management Succession Planning and Development15
MeetingMeetings and Attendance15
Code of Business Conduct1615
Conflicts of Interest and Related Person Transactions16
Transactions in Company Stock16
ShareownerStakeholder Engagement17
Communicating with ourthe Board of Directors1817
Political Contributions and Lobbying18
Sustainability19
Human Capital Management20
Corporate Governance Guidelines and Committee Charters1921
Our Board of Directors2022
Proposal 1 — Director Elections2022
Committees of the Board of Directors2729
2021 Director Compensation2830
Executive Compensation3031
Compensation Committee Report3031
Compensation Discussion and Analysis3031
2021 Summary Compensation Table4344
Supplemental 2021 Compensation Table45
2021 Grants of Plan-Based Awards4546
2021 Outstanding Equity Awards at Fiscal Year-End4647
2021 Option Exercises and Stock Vested4748
2021 Pension Benefits49
Pension Benefits47
2021 Non-Qualified Deferred Compensation4850
Potential Payments on Termination or Change in Control5052
Equity Compensation Plans5255
Median Employee to CEO Pay Ratio5355
Proposal 2 — Advisory Vote to Approve Named Executive Officer Compensation56
Ownership of Our Securities 5457
Securities Ownership of Certain Beneficial Owners and Management5457
Additional OwnershipDelinquent Section 16(a) Reports5558
Section 16(a) Beneficial Ownership Reporting Compliance56
Audit Committee Matters5759
Proposal 23 — Ratification of Auditors5759
Report of the Audit Committee Report5759
Principal Accounting Firm Fees5961
Shareowner Proposals6062
Proposal 34 — Shareowner Proposal Requesting the Board Prepare an Annual Report on Lobbying Activities6062
Proposal 45 — Shareowner Proposal Requesting the Board Prepare a Report on the Alignment of Lobbying Activities with the Paris Climate Agreement65
Proposal 6 — Shareowner Proposal to Reduce the Voting Power of Class A Stock from 10 Votes Per Share to One Vote Per Share6267
Proposal 57 — Shareowner Proposal Requesting the Adoption of Independently Verified Science-Based Greenhouse Gas Emissions Reduction Targets69
Proposal 8 — Shareowner Proposal Requesting a Report on Balancing Climate Measures and Financial Returns72
Proposal 9 — Shareowner Proposal Requesting the Board Prepare aan Annual Report Assessing the Integration of Sustainability Metrics into Executive Compensationon Diversity and Inclusion6475
Important Information About Voting at the 20192022 Annual Meeting6678
Other Information for Shareowners6982
Solicitation of Proxies6982
Eliminating Duplicative Proxy Materials6982
Proxy Access,Submission of Shareowner Proposals and Nominations for Director at the 2020 Annual MeetingNominations6982
20182021 Annual Report on Form 10-K7083
Other Business7083



www.upsannualmeeting.com   

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Table of Contents

United Parcel Service, Inc.
55 Glenlake Parkway, N.E.
Atlanta, GA 30328

March 15, 2019

United Parcel Service, Inc.
55 Glenlake Parkway, N.E.
Atlanta, GA 30328

March 21, 2022

Dear Fellow Shareowners:


 UPS is Strong
Today and
CREATING our
Tomorrow.
 

It is my pleasure to invite you to join us at UPS’s 2019the 2022 Annual Meeting of Shareowners. Since our last Annual Meeting, UPS has continued our sweeping transformation that is touching every part of our business — from leadership and culture to our operations, processes and the way we go to market.

In short, UPS is Strong Today, and CREATING our Tomorrow. We embarked on this transformation from a position of strength, with a commitment to create our own future. UPS has a powerful brand, an exceptional and essential global network, and a broad product and solutions portfolio that is designed to meet the current and emerging needs of our customers. UPS produces strong cash flow, the industry’s highest margins, and a solid balance sheet.

Our transformation is designed to achieve three principal goals: generate high-quality revenue growth; drive efficiencies and cost reductions that will improve our margins; and further develop our talent as we continue to foster a culture of innovation.

The investments we are making in our network, people, technology and products will improve leverage in our global operations – and are creating greater differentiation for UPS in the markets we serve. Our customers will benefit from more flexibility, consistency and visibility in how packages are moved through our network. By enhancing the value we create for our customers, we will generate higher revenue per package, better balance between our business and residential-based volumes and a higher level of earnings growth.

We made substantial progress on the network investment initiatives we first discussed in early 2017. We are implementing technology that is making our network and our company more efficient, more flexible, more resilient, and more anticipatory. The result is a network that enables us to attract additional opportunities for high quality growth and generate improved operating margins.

We are capturing opportunities through digital technology and automation that are changing the way people and companies connect and communicate. Additionally, our advanced methods of optimizing the flows of freight and packages with available capacity results in improved transit times for our customers and better asset utilization and network efficiency. To build on those improvements and fulfill the growing demand for our services, we are significantly expanding capacity through comprehensive investments across our operations.

These improvements have succeeded in large part due to the innovative ideas and commitment to service our people bring to UPS everyday. We will continue to shape our culture so we can seize on the new market opportunities of the 21st century.

I want to encourage all of our shareowners to vote. This is your opportunity to share your views with the Company.Company and the Board of Directors. We look for meaningful ways to engage with our investorstake this feedback into account as we continually seekperform our board responsibilities.

The uncertainty resulting from the pandemic continued to challenge us during 2021. Despite this, the Company capitalized on opportunities to create long-term value as it continued to execute its strategy – Customer First, People Led, Innovation Driven.

Carol completed a successful first full year as CEO, aligning UPS leadership and executing under her Better, Not Bigger strategic framework. Carol’s leadership and the board’s oversight have strengthened the link between the Company’s strategic framework and its financial commitments, connecting purpose to strategy.

We understand that delivering on our financial targets is critical to creating long-term shareholder value. In 2021, the Company generated record results, including strong profit growth through increased margins in all segments, primarily facilitated by management’s focus on executing strategic initiatives, including targeted international growth, healthcare, and small and medium-sized businesses. All of this occurred with an increased emphasis on attracting, developing, and retaining a motivated and valued workforce that embraces diversity and inclusion. The Company’s emphasis on taking care of its customers and employees positions us well for sustainable success.

In 2021, the board oversaw the development of new sustainability and ESG goals, including the goal of becoming carbon neutral by 2050, the goal of having 28% women in management and the goal of maintaining 35% ethnically diverse company management. The board also facilitated the first publication of the Company’s EEO-1 report and the formal delegation of human capital oversight responsibility to the board’s Compensation Committee. Our five new directors have contributed significantly to boardroom discussions related to the advancement of these matters. However, we understand there is still more work to do at this important time.

The board is also proud of the efforts of all UPSers who helped drive our purpose - moving our world forward by delivering what matters. Since its founding almost 115 years ago, UPS has fostered an employee ownership culture, with employees regularly answering the call to help one another and our communities. In 2021, the Company achieved a number of significant milestones, including delivering over 1 billion doses of the COVID-19 vaccine. The board continues to believe that this culture is significantly facilitated by the Company’s capital structure. UPS’s unique employee ownership model has helped it grow our business, improveand thrive by allowing management to run the Company with a sense of purpose by focusing on sustainable long-term value creation benefiting all stakeholders. It is indicative of this culture that the board and management have embraced the increased stakeholder focus on environmental, social and governance and increase shareowner value.matters.

I want to encourage all my fellow shareowners to vote. We are grateful to those shareowners who have previously shared their views. As we approach the Annual Meeting, I encourage you to contact us with any questions or feedback at 404-828-6059.

On behalf of the entire Board of Directors, thank you for your continued support of UPS.support.

David P. Abney

William Johnson
Chairman and Chief Executive OfficerUPS Board Chair

4      Notice of Annual Meeting of Shareowners and 20192022 Proxy Statement

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Notice of UPS 2019 Annual Meeting

UNITED PARCEL SERVICE, INC.

55 Glenlake Parkway, N.E., Atlanta, Georgia 30328


●

Date and Time:May 9, 2019,5, 2022, 8:00 a.m. Eastern Time

●

Place:The meeting will be held exclusively online via webcast at: www.virtualshareholdermeeting.com/UPS2022.Hotel du Pont, 11th and Market Streets, Wilmington, Delaware

●

Record Date:March 11, 20199, 2022

●

Distribution Date:A Notice of Internet Availability of Proxy Materials or the Proxy Statementproxy statement is first being sent to shareowners on or about March 15, 2019.21, 2022.

●

Voting:Holders of class A common stock are entitled to 10 votes per share; holders of class B common stock are entitled to one vote per share.Your vote is important. Please vote as soon as possible by usingthrough the Internet, by telephone or by signing and returning your proxy card (if you received a paper copy of the proxy card by mail)card). Your voting options are described on the Notice of Internet Availability of Proxy Materials, voting instruction form and/or proxy card.

●

Admission:Attending the Meeting: To attendYou or your proxyholder can participate, vote, ask questions and examine our list of shareowners at the meeting by visiting www.virtualshareholdermeeting.com/UPS2022 and using your 16-digit control number found on your proxy card, voting instruction form or Notice of Internet Availability. Shareowners who do not receive a 16-digit control number should consult their voting instruction form or Notice of Internet Availability and may need to request a legal proxy from their bank, broker or other nominee in advance of the meeting in person you will need proof of your share ownership (seeorder to participate. For more information, please see page 68 for acceptable proof of ownership) as of the record date and a form of government-issued photo identification.80.

Important Notice Regarding the Availability of Proxy Materials for the Shareowner Meeting to be heldHeld on May 9, 2019:5, 2022: The Proxy Statement and our 20182021 Annual Report are available at www.proxyvote.com.Questions? Call 404-828-6059 (option 2).

Norman M. Brothers, Jr.
Secretary
Atlanta, Georgia
March 15, 2019

Items

By order of Business


     Voting
Choices		     Board Voting
Recommendations		     Page

Company Proposals:

1.

Elect 12 director nominees named in the Proxy Statement to serve until the 2020 Annual Meeting and until their respective successors are elected and qualified

●Vote for all nominees
●Vote against all nominees
●Vote for some nominees and against others
●Abstain from voting on one or more nominees

FOR ALL

20

2.

Ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for 2019

●Vote for ratification
●Vote against ratification
●Abstain from voting on the proposal

FOR

57

Shareowner Proposals (if properly presented):

3.

Prepare an annual report on lobbying activities

●Vote for the proposal
●Vote against the proposal
●Abstain from voting on the proposal

AGAINST

60

4.

Reduce the voting power of class A stock from 10 votes per share to one vote per share

●Vote for the proposal
●Vote against the proposal
●Abstain from voting on the proposal

AGAINST

62

5.

Prepare a report to assess the integration of sustainability metrics into executive compensation

●Vote for the proposal
●Vote against the proposal
●Abstain from voting on the proposal

AGAINST

64

the Board of Directors

Norman M. Brothers, Jr.
www.upsannualmeeting.com    

5Secretary
Atlanta, Georgia
March 21, 2022


TableItems of ContentsBusiness

Voting
Choices		Board Voting
Recommendations		Page
Company Proposals:
1.    Elect 13 director nominees named in the Proxy Statement to serve until the 2023 Annual Meeting and until their respective successors are elected and qualified 

●Vote for all nominees

●Vote against all nominees

●Vote for some nominees and against others

●Abstain from voting on one or more nominees

FOR
EACH
NOMINEE		22
2.    Approve, on an advisory basis, named executive compensation

●Vote for the resolution

●Vote against the resolution

●Abstain from voting on the resolution

FOR56
3.    Ratify the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for 2022

●Vote for ratification

●Vote against ratification

●Abstain from voting on ratification

FOR59
Shareowner Proposals:
4. - 9.    Advisory votes on 6 shareowner proposals, only if properly presented

●Vote for each proposal

●Vote against each proposal

●Abstain from voting on the proposals

AGAINST
EACH
PROPOSAL		62
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Proxy Statement

UNITED PARCEL SERVICE, INC.

55 Glenlake Parkway, N.E., Atlanta, Georgia 30328

This Proxy Statement contains important information on Company matters that require your vote atabout the 20192022 Annual Meeting of Shareowners (the “Annual Meeting”). We are providing these proxy materials to you because you own shares of United Parcel Service, Inc. common stock and our Board of Directors is soliciting your proxy to vote your shares at the Annual Meeting. We are first mailing this Proxy Statement to our shareowners on or about March 15, 2019. The Annual Meeting will be held online only on May 9, 2019,5, 2022, at 8:00 a.m. Eastern Time, at Hotel du Pont, 11thwww.virtualshareholdermeeting.com/ UPS2022. Shareowners can participate, ask questions, vote and Market Streets, Wilmington, Delaware.examine our shareowner list during the meeting through this website.

All properly executed written proxies, and all properly completed proxies submitted bythrough the Internet or by telephone, that are delivered pursuant to this solicitation will be voted at the Annual Meeting in accordance with the directions given in the proxy, unless the proxy is revoked prior to completion of voting at the meeting. Only owners of record of shares of the Company’s common stock as of the close of business on March 11, 2019, the9, 2022 (the “Record Date”,) are entitled to notice of, and to vote at, the Annual Meeting (or any adjournment or postponement of the meeting)Annual Meeting). We are first mailing this Proxy Statement on or about March 21, 2022.

Proxy Statement Summary

This summary highlights information contained elsewhere in this Proxy Statement.

Corporate Governance

Corporate Governance

Following is a brief overview ofare some of our corporatekey governance policies and practices:

●We maintain ana diverse and independent board; all of our directors are independent, other than our Chairman and CEO;Chief Executive Officer (“CEO”);
●We have aan independent Board Chair who is highly engaged lead independent director with significant oversight responsibilities;and experienced;
●All of ourOur independent directors are elected annually;meet in executive sessions without management at each board meeting;
●We have adopted a proxy access bylaw allowing qualifying shareowners to include director nominees in the Proxy Statement;
●We hold annual elections for all directors; and we provide for majority voting in uncontested director elections;
●Acting as a full board and through each independent board committee, theThe board is fully engaged in the Company’s strategic planning process, conducting an in depthin-depth annual strategy review of Company strategy on an annual basis and receiving regular updatesoverseeing progress throughout the year;
●Our independent directors meet regularly without management;
●The board has aboard’s Risk Committee comprisedconsists entirely of independent board members thatand is responsible for assisting in overseeing management’sthe identification and evaluation of enterprise risks including risks associated with cyber-security;;
●The boardWe regularly evaluate our governance policies and each board committee conduct evaluations annually;practices, and make changes when appropriate; including recently separating the Chair and CEO roles, providing our shareowners with an annual say on pay vote, and delegating additional human capital oversight responsibilities to the Compensation and Human Capital Committee;
●We regularly engage with shareowners; westakeholders on environmental, social and governance (“ESG”) matters, for example during this proxy season management contacted holders of over 43%47% of our class B common stock during this proxy season to discuss sustainability initiatives, our commitments to social justice and executive compensation programs and corporate governance practices;matters;
●OurWe maintain robust stock ownership guidelines include, including a target ownership of eight times annual salary for the Chief Executive Officer and CEO, five times annual salary for other executive officers;officers and five times the annual retainer for directors; and
●ExecutiveWe prohibit our executive officers and directors are prohibited from hedging or pledging their ownership in UPS stock and, since 2014, have been prohibited from entering into pledges of UPS stock.

6      Notice of Annual Meeting of Shareowners and 20192022 Proxy Statement

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Proxy Statement Summary

The UPS

Our Board
The

Our independent Board of Directors is responsible for the strategic oversight of our Company. Beyond aUPS. A summary of their relevant skills, experience and diversity is below. For more information, see page 22.

Our directors’ broad range ofprofessional skills and experiences, we seek contribute to maintain anoptimal mixa wide range of newer directors, who bring fresh perspectives andlonger-tenured directors, who have contributed to developing our strategy over time, and have acquired an in-depth understanding of our global organization. A majority of non-management independent directors ensuresrobust debate and challenged opinionsin the boardroom while

diversityDiversity in our boardroom supports UPS’s continued success

   7

Table of gender, age and ethnicity contributes toContents

Election of Directors

As a diverse range of views.

The board believes that the 2019group, our 13 director nominees are of an appropriate compositionappropriately skilled and experienced to effectively oversee and constructively challenge the performance of management in the execution of our strategy.

As a group, our 12 director nominees have the skills and experience to effectively oversee a global organization

Each year, the Nominating and Corporate Governance Committee assesses the skills and experience necessary for our board to function effectively, and considers where additional expertise may be needed.

We believe that as a group, our 12 director nominees bring the requisite skills and experience to ensure the overall effectiveness of our Board.

The board has been meaningfully refreshed since 2010 with 7 independent directors joining, and 5 departing the board*recommends you vote FOR

The board recognizes that it continually needs to monitor and improve the effectiveness of its operations and our directors. This is achieved through, among other practices, an annual detailed evaluation process that provides for quantitative ratings in key areas of board performance and through director education opportunities.

The board consists of individuals with deep experience and knowledge of UPS, complemented by the fresh perspective of newer directors. Together, our directors work effectively as a team, and are highly focused on UPS’s success.

Our Chairman and CEO provides strong leadership and is supported – and constructively challenged – by an independent board

While our current CEO serves as Chairman, the board benefits from the oversight of 11* independent directors, including an engaged lead independent director; William “Bill” Johnson has served in this role since 2016.

We believe that diversity in our boardroom supports UPS’s continued success and advantage

Gender Diversity*Overall Diversity*Age Diversity*


* Excludes currenteach director Candace Kendle, whose board service will conclude at the 2019 Annual Meeting.

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Election of Directors

The table below provides summary information about the 12 director nominees.nominee listed below. For more information, see page 20.22.

NameAgeDirector
Since		OccupationCommittee(s)Other Public
Company
Boards
Independent Directors
Rodney C. Adkins602013Former Senior Vice President, International Business Machines
–Risk (Chair)
–Compensation
4(2)
Michael J. Burns672005Former Chairman, Chief Executive Officer and President, Dana Corporation
–Audit
0
William R. Johnson(1)702009Former Chairman, President and Chief Executive Officer, H.J. Heinz Company
–Nominating and Corporate Governance (Chair)
–Executive
 

 

1
Ann M. Livermore601997Former Executive Vice President, Hewlett-Packard Company
–Compensation (Chair)
–Risk
–Executive 
2
Rudy H.P. Markham732007Former Financial Director, Unilever
–Compensation
–Nominating and Corporate Governance
2
Franck J. Moison652017Former Vice Chairman, Colgate-Palmolive Company
–Nominating and Corporate Governance
–Risk
1
Clark T. Randt, Jr.732010Former U.S. Ambassador to the People’s Republic of China
–Compensation
–Nominating and Corporate Governance
3
Christiana Smith Shi592018Former President, Direct-to-Consumer, Nike, Inc.
–Compensation
–Risk
2
John T. Stankey562014Chief Executive Officer, WarnerMedia
–Audit
0
Carol B. Tomé622003Chief Financial Officer and Executive Vice President — Corporate Services, The Home Depot, Inc.
–Audit (Chair)
0
Kevin Warsh482012Former Member of the Board of Governors of the Federal Reserve System, Distinguished Visiting Fellow, Hoover Institution, Stanford University
–Compensation
–Nominating and Corporate Governance
0
Non-Independent Director
David P. Abney632014Chairman and Chief Executive Officer, United Parcel Service, Inc.
–Executive (Chair)
1

Name     Age     Director
Since		     Occupation     Committee(s)     Other Public
Company
Boards
Independent Directors    
Rodney Adkins 63 2013 Former Senior Vice President, International Business Machines Corporation 

– Risk (Chair)

– Compensation and Human Capital

 3
Eva Boratto 55 2020 Chief Financial Officer, Opentrons Labworks, Inc. – Audit (Chair) 0
Michael Burns 70 2005 Former Chairman, President and Chief Executive Officer, Dana Incorporated – Audit 0
Wayne Hewett 57 2020 Senior Advisor to Permira, and Chairman of Cambrex Corporation – Audit 2
Angela Hwang 56 2020 Group President, Pfizer Biopharmaceuticals Group, Pfizer, Inc. – Audit 0
Kate Johnson 54 2020 Former President, Microsoft U.S., Microsoft Corporation 

– Nominating and Corporate Governance

– Risk

 0
William Johnson(1) 73 2009 Former Chairman, President and Chief Executive Officer, H.J. Heinz Company 

– Nominating and Corporate Governance (Chair)

– Executive

 1
Ann Livermore 63 1997 Former Executive Vice President, HP Inc. 

– Compensation and Human Capital (Chair)

– Risk

– Executive

 3
Franck Moison 68 2017 Former Vice Chairman, Colgate-Palmolive Company 

– Nominating and Corporate Governance

– Risk

 1
Christiana Smith Shi 62 2018 Former President, Direct-to-Consumer, Nike, Inc. 

– Compensation and Human Capital

– Risk

 1
Russell Stokes 50 2020 President and Chief Executive Officer, GE Aviation Services 

– Compensation and Human Capital

– Nominating and Corporate Governance

 0
Kevin Warsh 51 2012 Former Member of the Board of Governors of the Federal Reserve System, Distinguished Visiting Fellow, Hoover Institution, Stanford University 

– Compensation and Human Capital

– Nominating and Corporate Governance

 1
Non-Independent Director    
Carol Tomé 65 2003 Chief Executive Officer – Executive (Chair) 1
(1)Lead Independent Director
  
(2)(1)Rodney Adkins has informed us that, as of May 2019, he will be serving on no more than three other total public company boards of directors.Independent Board Chair.

8      Notice of Annual Meeting of Shareowners and 20192022 Proxy Statement

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Proxy Statement Summary

Executive Compensation

For more information see page 30.

Executive Compensation

Compensation Practices

A significant portion of executive compensation is at-risk and tied to Company performance over a multi-year period.performance. This aligns executive decision-making with the long-term interests of our shareowners. We also have a long-standinglongstanding owner-manager culture. TheOur compensation and governance practices that support these principles include:

●A Payments with a balanced mix of cash and equity annual, providing a degree of financial certainty and longer-termappropriate incentives to retain and performance metrics which mitigate excessive risk-taking;motivate executives;
●Annual and long-term performance incentive awards are paid partially in the form of equity and containgrants containing vesting requirements beyond the performance period;period, furthering both retention and incentive goals;
●Annual and long-term performance incentive award payouts that are dependent upon the achievement of multiple distinct goals, avoiding overemphasis on any one metric and mitigating excessive risk-taking;
●Long-term performance incentive awards include multiple goals to avoid over emphasis on any one metric; thewith a three-year performance goals are (1) revenue growth, (2) operating return on invested capital and (3) relative total shareowner return (“TSR”)period;
●Long-term performance incentive awards vest following a three-year performance period;
●Stock option awards that vest ratably over a five-year period;period and only provide value if our stock price increases;
●Incentive Compensation Planscompensation plans that include clawback provisions that permit us to recoverrecovery of awards granted to executive officers;
●Incentive Compensation Plan requirescompensation plan awards require a “double trigger”“double trigger” — both a change in control and a termination of employment — to accelerate the vesting of awards that are not continued or assumed by a successor entity;vesting; and
●No tax gross-ups to executive officers with respect toon equity awards.awards or golden parachute excise taxes.

20182021 Compensation Actions

Key 20182021 compensation decisions foraffecting our Named Executive Officers (“NEOs”)executive officers included:

●Most total direct compensation iswas performance-based and is considered “at risk” (86%(90% for the CEO and 85% for all other named executive officers (“NEOs”) as a group). See page 32;
●Base salary increases for the NEOs as a group and 90% for the CEO). See page 31;
●In order to help attract senior executive talent to participate in the transformation of our business, the Compensation Committee approved the compensation for two external hires to the Company’s Management Committee. See page 40;
●As a result of the annual salary review process, base salaries were increased by an average of 2.8%.process. See page 33;35;
●Bifurcating the performance period for the annual incentive awards to account for the uncertainty attributable to the COVID-19 pandemic. See page 35;
●Annual incentive awards for Company and individual performance during the year ended December 31, 2018all NEOs were earned above target for all NEOs.target. See page 34;37; and
●Previously granted 20162019 Long-Term Incentive Performance (“LTIP”) awards, which had three-year performance goals of revenue growth, operating return on invested capital and relative total shareowner return ending in 2018,2021, were earned at 74% ofabove target. See page 39.


Ratification of the Appointment of the Independent Registered Public Accounting Firm

Annual Say on Pay Vote

We maintain executive compensation programs that support the long-term interests of our shareowners. We provide shareowners the opportunity to vote annually, on an advisory basis, to approve the compensation of our NEOs, as described in the Compensation Discussion and Analysis section and in the compensation tables and accompanying narrative disclosure in this proxy statement. For more information, see page 56.

The board recommends you vote FOR the advisory vote to approve named executive officer compensation.

Ratification of the Appointment of the Independent Registered Public Accounting Firm

The Board of Directors has appointed Deloitte & Touche LLP as our independent registered public accounting firm for the year ending December 31, 2019.2022. The board recommends that you ratify vote FOR the appointment. Following is summary information aboutratification of the fees billed to us byappointment of Deloitte & Touche LLP during the years ended December 31, 2018 and 2017.LLP. For more information, see page 57.59.


     2018     2017
Fees Billed:
       Audit Fees$14,558,000$14,608,000
      Audit-Related Fees$968,000$1,234,000
      Tax Fees$825,000$720,000
Total$16,351,000$16,562,000


Shareowner Proposals

Shareowner Proposals

The board recommends you vote AGAINST the shareowner proposals (1) requesting the preparation of an annual report on lobbying activities, (2) seeking to reduce the voting power of our class A stock and (3) requesting the preparation of a report assessing the feasibility of incorporating sustainability metrics into executive compensation.proposals. More information about these proposals is available startingstarts on page 60.62.


www.upsannualmeeting.com 

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Table of Contents

Corporate Governance

Corporate Governance

Our Board of Directors employsWe maintain robust governance policies and practices that foster effective oversightbenefit the long-term interests of critical matters such as strategy, management succession planning, financialall stakeholders. We regularly review and update our corporate governance practices in response to the evolving needs of our business, shareowner and other controls, risk management and compliance. The board reviews our major governance documents, policies and processes regularly in

the context of current corporate governance trends,stakeholder feedback, regulatory changes, and recognized best practices. The following sections provideother corporate developments. Following is an overview of our corporate governance structure and processes, including key aspects of our board operations.


Selecting Director Nominees

Maintaining a board of individuals independent of management, and of the highest personal character, integrity and ethical standards, is crucial.critical to the proper functioning of the board. The Nominating and Corporate Governance Committee also seeks to create a board that reflects a range of professional backgrounds and skills relevant to our business, as well aspromote diversity in the boardroom with respect to gender, age, ethnicity, skills, experience, perspectives, and ethnicity. Some of the most important skills and experiences our board seeks in potential director candidates are audit and financial proficiency, operator or general manager experience, and digital technology expertise. other factors. Our directordirectors’ biographies highlight the skills and experiencesfactors that led the board to conclude that the nominee should serve as a director.considered when nominating these individuals.

The Nominating and Corporate Governance Committee uses a variety of sources to identify potential candidates, including recommendations from independent directors or members of management, outside consultants, discussions with other persons who may know of suitable candidates and shareowner recommendations. Prospective candidate evaluations typically include the Nominating and Corporate Governance Committee’s review of the candidate’s background and qualifications, interviews with Committee members and other board members, and open discussions between the Committee and the full board. An outside consultant helps identify, screen and recruit director candidates in consultation with the Nominating and Corporate Governance Committee. This process allows for active and ongoing consideration of potential directors with a long-term focus on Company strategy.


The Board’s Director Nomination Process


1

Board Composition Review
 
Review of Board Composition
The board’s annual evaluationself-evaluation helps the Nominating and Corporate Governance Committee identify the board’s current needs byassessing areas where additional diversity, perspectives, expertise, skills or experience may be needed.desired. The Nominating and Corporate Governance Committee regularlyalso conducts anregular in-depth board composition analysis.reviews.
2Candidate Identification
Identification of Candidates
The Nominating and Corporate Governance Committee uses a variety of sources to identify potential candidates and emphasizes the importance of identifying a diverse pool of potential candidates. The NominatingSources include board members, members of management, independent consultants and Corporate Governance Committeeshareowner recommendations. Prospective candidates are evaluated after taking into account feedback from consultants, management and board members, candidate background and qualification reviews, and recommends director nominees to the board, including candidates to fill vacancies.When evaluating director candidates,open discussions between the Nominating and Corporate Governance Committee considers factors such as personal character, values and disciplines, ethical standards, other outside commitments, professional backgroundthe full board. This process allows for active and skills.ongoing consideration An independent consultant helps evaluateof potential candidates and supports the recruitment process.directors with a focus on long-term Company strategy.
3
Shortlisted Candidates
The Nominating and Corporate Governance Committee maintains a diverse list of potential director candidates according to desired skills, experiences and experiences.backgrounds. The list is reviewed frequentlyat each Nominating and Corporate Governance Committee meeting and updated as needed.appropriate. Each director candidate is carefully evaluated to ensure that existing and planned future commitments willwould not materially interfere with expected responsibilities to the candidate’s responsibilities as a UPS director.Company.
4
Recommendation, Nomination and Annual Election
Candidates identifiedrecommended by the Nominating and Corporate Governance Committee and approved by the board arenominated for election at the Annual Meeting.election. Directors are elected annually.
ResultResult:
75 new independent directors added since 20102020

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Shareowner Recommendations, Nominations and Proxy Access

The Nominating and Corporate Governance Committee will consider shareownerProxy Access

Shareowner recommended director candidates are considered on the same basis as recommendations from other sources. Shareowners can recommend a director candidate to the Nominating and Corporate Governance Committee by submitting the name of the prospective candidate in writing to the following address: UPS Corporate Secretary, 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328. Submissions should describemust contain the prospective candidate’s name and a detailed description of the experience, qualifications, attributes and skills that make the prospective candidateindividual a suitable director nominee.candidate.

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In 2017, we proactively adopted aCorporate Governance

We also provide proxy access bylaw as part of our ongoing commitment to strong corporate governance practices following thoughtful discussions with shareowners

through the Company’s long-standing outreach program. We provide afor shareowner director nominees. A single shareowner, or group of up to 20 shareowners, that has owned at least 3 percent of UPS’s outstanding stock continuously for at least three years, may include up to 20 percent of the ability to includeboard seats or two directors (whichever is greater), as director nominees in UPS’s proxy materials for an annual meeting of shareowners. Shareowners may include in the proxy materials the greater of 20 percent of the board seats or two directors. Our Bylaws set forth the requirements for the formal shareowner nomination process for director candidates. These requirements are describedsummarized under “Other Information for Shareowners — Proxy Access, Shareowner Proposals and Nominations for Director at the 2020 Annual Meeting”Shareowners” on page 69.82.


Board Diversity

Effective decision-makingA wide range of viewpoints is facilitated bycritical to effective board deliberations, corporate governance and oversight. Diversity with respect to gender, age, ethnicity, skills, experience, perspectives, and other factors is a variety of viewpoints. Diversity is an importantkey consideration forwhen identifying and recommending director nominees. The Nominating and Corporate Governance Committee assesses board diversity through periodic board composition evaluations. While the Company does not have a formal policy on board diversity, our Corporate Governance Guidelines emphasize diversity, and the Nominating and Corporate Governance Committee when identifying director nominees. The Committeeactively considers the board’s overall composition in light of race, gender, age and cultural background, as well as diversity in experiencerecruitment and skills relevant to the oversightnominations of a complex global business. The

Nominating and Corporate Governance Committee assesses the effectiveness of its diversity efforts through periodic evaluations of the board’s composition.

Our 12 director nominees include a diverse range of individuals, including three women, one African-American, two Europeans and a nominee who spent his entire career in Asia. The director nominees range between 48 and 73 years of age.candidates.


 

Gender Diversity*

 

Overall Diversity*

Ethnicity		 

Age Diversity*

 

25%female

 

33%diversity of gender and ethnicity

 

63yearsmedian age

 

Board Refreshment and Succession Planning

7.6yearsmedian tenure*
 

The Nominating and Corporate Governance Committee regularly considers the long-term make-upmakeup of our Board of Directors and how theboard composition of our board changes over time. The Nominating and Corporate Governance CommitteeThey also considersconsider the skills needed on our board as our business and the markets in which we do business evolve.evolves. The board seeks to balance the knowledge and experience that comes from longer-term board service with the new ideas and energyperspectives that can come from adding new directors to the board. directors.

Since 20102020, we have added 7five new independent directors, to the board and have had 5four directors retire.

The medianaverage tenure forof the director nominees of approximately 8 years reflects thean appropriate balance the board seeks between different perspectives brought by long-serving directorsnewer and newlong-serving directors.

* Excludes current director Candace Kendle, whose board service will conclude at the 2019 Annual Meeting.

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Director Independence

Having a significant majority of non-management independent directors encourages robust debate and challenged opinions in the boardroom.

92%independent
 

Our Corporate Governance Guidelines include director independence standards that meet the listing standards set forth byconsistent with the New York Stock Exchange (“NYSE”), which require a majority of the directors to be independent. listing standards. Our Corporate Governance Guidelines are available on the governance section of our investor relations website at www.investors.ups.com.

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The board reviewedhas evaluated each director’s independence in February 2019 and considered whether there were any relevant relationships between UPS and each director, or any member of his or her immediate family. The board also examined whether there were any relationships between UPS and organizations where a director is or was a partner, principal shareowner or executive officer. This review allowed the board to determine whether any such relationships impacted a director’s independence. Specifically, the board evaluated certain ordinary course business transactions and relationships between UPS and the organizations that currently or in the prior year employed MichaelEva Boratto, Mike Burns, Franck Moison, John Stankey,Wayne Hewett, Angela Hwang, Kate Johnson, Russell Stokes and

Carol Tomé, Kevin Warsh, or their immediate family members.members, as an executive officer. The board also evaluated the ordinary course business transactions and relationships between UPS and any organizations where Rod Adkins, Wayne Hewett, Christiana Smith Shi and Kevin Warsh, or their immediate family members, were a partner or principal shareowner. In each case, no such transactions exceeded the thresholds in UPS’s Corporate Governance Guidelines. The board determined that none of these transactions or relationships were material to the Company, the individuals or the organizations with which they were associated.

As a result of this review, theThe board affirmativelyhas determined that all our directors (which includes alleach of the director nominees other(other than Chairman and Chief Executive Officer David Abney) areour current CEO, Carol Tomé), is independent. With respect to directors that served during 2021 but have retired, the board has determined that each such individual was independent. All members of the Audit Committee, Compensation and Human Capital Committee, Nominating and Corporate Governance Committee and Risk Committee are independent.


Board Leadership Structure

Based on the periodic evaluation and recommendation of the Nominating and Corporate Governance Committee, the board determines the most appropriate board leadership structure, for the Board of Directors at any given time. Historically, our Chief Executive Officer has served as Chairman of the Board, as all ten of our previous Chief Executive Officers also served as Chairman. This leadership structure has been effective for the Company.

The Nominating and Corporate Governance Committee makes recommendations to the board aboutincluding who should serve as ChairmanBoard Chair, and Chief Executive Officer,whether the roles of Board Chair and CEO should be separated or combined.

In connection with Carol Tomé’s election as CEO, the board then selects the Chairman and Chief Executive Officer. The board determined that UPS Chairman and Chief Executive Officer David Abney isit was in the best positionedinterests of the Company to continueenable Carol to lead the board at this time and to focus

the board’s attention on the issues of greatest importance toleading the Company, and its shareowners. Davidseparated the roles of Chair and CEO. Bill Johnson, who had been serving as our independent Lead Director, was appointed Board Chair on October 1, 2020.

Bill has primary responsibility for managingserved on our board since 2009 and had served as independent Lead Director since 2016. He has deep institutional knowledge of the Company’s dayCompany and provides strong continuity of leadership. He devotes significant time to day operations,understanding our business and hecommunicating with the CEO, and other directors, between meetings. He draws on his extensive knowledge of our business, industry, strategic priorities and competitive developments key customers and business partners to set the board’s agenda. David communicates UPS’s strategy to shareowners, employees, regulators, customers and the public. He provides open and frequent feedback to board members on significant matters within and outside of the board meeting cycle. David is available to all directors between meetings and meets regularlyagendas in collaboration with the lead independent director, as described below, to receive feedback from the board. HeCEO, and he seeks to ensure that board meetings are productive and interactions with the directors facilitate a useful exchange of viewpoints.


Independent Board Leadership

Independent oversight Carol is importantavailable to all directors between meetings and meets regularly with the Board Chair, and with the directors individually and as a group, to receive feedback from the board. Bill’s collaboration with Carol allows the board to focus attention on the issues of greatest importance to the board. Accordingly, in February 2016,Company and its shareowners and our CEO to focus primarily on leading the independent directors of the board appointed William “Bill” Johnson as lead independent director. Bill devotes significant time to understanding our business and communicating with the Chairman and other directors between meetings. He provides significant input into the board meeting agendas and he spends time with our Chairman and Chief Executive Officer after each board meeting to provide feedback. He also periodically meets with our largest shareowners to answer questions and to provide perspective on appropriate topics, such as the Company’s culture and governance practices.Company.

Our lead independent director’s leadership authority and responsibilities include:

●Presiding at meetings of the board at which the Chairman is not present, including executive sessions of the non-management and independent directors;
●Approving information to be sent to the board;
●Approving the agenda and schedule for board meetings to provide sufficient time for discussion of all agenda items;
●Serving as liaison between the Chairman and the non-management and independent directors;
●Being available for consultation and communication with major shareowners upon request; and
●Having the authority to call executive sessions of the non-management and independent directors.


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Furthermore, all of the members of each of the Audit Committee, the Compensation and Human Capital Committee, the Nominating and Corporate Governance Committee and the Risk Committee are independent. Each committee is led by a chairperson who sets the meeting agendas and reports to the full board on the committee’s work.

Additionally, the independent directors meet in executive session without management present as frequently as they deem appropriate,at each board meeting, as described below. This structure provides the best form of leadership for the Company and its shareowners at this time.


Executive Sessions of Independent Directors

Our independent directorsDirectors hold executive sessions without management present as frequently as they deem appropriate, typically at the time of each regular board meeting. The lead independent directorBoard Chair determines the agenda for each session,and presides at each session and, aftersession. The Board Chair generally invites the session, acts as a liaison

between the independent directors and the Chairman and Chief Executive Officer. The lead independent director may invite the Chairman and Chief Executive OfficerCEO to join a portion of the executive session for certain discussionsto receive feedback from the board and when deemed appropriate.appropriate otherwise. In addition, during the year the Board Chair meets individually with each director to discuss issues that are important to the board and to solicit and provide further feedback.


Board and Committee Evaluations

The board employs both an ongoing informal and a formal annual process to evaluate its performance and the contributions of individual directors to the successful execution of the board’s obligations. The Board Chair frequently considers the performance of the board and the board’s committees and has informal discussions about individual director contributions to the board. The Board Chair shares feedback from these discussions with the full board and with individual board members. In addition, during 2021 the CEO met individually with each director to discuss how best to utilize the director’s skills and experience. The feedback from these meetings was reviewed with the Board Chair.

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Corporate Governance

Formal Evaluation Process


1
Detailed Formal and Detailed Annual Evaluation Process
The chartersBoard of each of theDirectors, Audit Committee, Compensation and Human Capital Committee, Nominating and Corporate Governance Committee and Risk Committee requireeach conduct an annual performance evaluation.self-assessment. The Nominating and Corporate Governance Committee oversees the annual board assessment process and the implementation of the annual committee assessments.self-assessments.
2Questionnaires
Questionnaires
All board and committee members complete a detailed confidential questionnaire each year. The questionnaire provides for quantitative ratings in key areas, including overall board effectiveness, meeting effectiveness, access to information, information format, board committee structure, access to management, succession planning, meeting dialogue, communication with the CEO, operational reporting, financial oversight, capital structure and financing, capital spending, long-term strategic planning, risk oversight, crisis management and time management. The questionnaire also allows directors to provide written feedback and make detailed anonymous comments.
3Review
Review
The results of the committee self-assessments are reviewed by each committee and discussed with the full board. The Chair of the Nominating and Corporate Governance Committee reviews the results of committee self-assessments and discusses the responses with the chairs of the other board Committees.committees as appropriate. The Chair of the Nominating and Corporate Governance Committee also reviews and discusses the board evaluation results with the full board.
4Follow-up
Follow-up
Matters requiring follow-up are addressed by the Chair of the Nominating and Corporate Governance Committee or the chairs of the other committees as appropriate.
Result

Feedback from the evaluations has driven several changesimprovements in board operations over the last few years, including the format and timing of delivery of board meeting materials, board meeting agendas and recurring topics, strategic planning and oversight, director recruitment practices and orientation, and director recruitment practices.

succession planning.

The Chairman and the board’s lead independent director frequently discuss the performance of the board and the board’s committees, and have informal discussions about individual director contributions to the board. The lead independent director shares feedback from these discussions with the full board and with individual board members.

All board and committee members complete a detailed evaluation questionnaire each year. The board questionnaire provides for quantitative ratings in key areas, including overall board effectiveness, meeting effectiveness, access to information, information format, board committee structure, access to management, succession planning, meeting

dialogue, communication with the CEO, operational reporting, financial oversight, capital structure and financing, capital spending, long-term strategic planning, risk oversight, crisis management and time management. The questionnaire also allows directors to provide written feedback and make detailed anonymous comments.

Feedback from these evaluations in 2018 led to several important changes in board operations, including changes to board meeting agendas and recurring topics, additional attention to the succession planning process, and board committee membership rotations.


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Majority Voting and Director Resignation Policy

Our Bylaws provide for majority voting in uncontested director elections. This means that in order to be elected, theThe number of votes cast for a nominee must exceed the number of votes cast against that person.

In accordance with our director voting policy, any Any incumbent director who does not receive a majority of the votes cast must offer to resign from the board. The

In such an event, the Nominating and Corporate Governance Committee will recommend to the board whether to accept or reject the director’s offer to resign after considering all relevant factors. The board will act on the recommendation within 90 days following certification of the election results.

The board will take into account the factors considered by the Nominating and Corporate Governance Committee and any additionalresults after considering all relevant information.

Any director who offers to resign must recuse himself or herself from the board vote, unless the number of independent directors who were successful incumbents is fewer than three. The board will promptly disclose its decision regarding any director’s offer to resign, including its reasoning. If the board determines to accept a director’s offer to resign, the Nominating and Corporate Governance Committee will recommend whether and when to fill such vacancy or whether to reduce the size of the board.

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Risk Oversight


Board Oversight of Risk


Board of Directors

Responsible for overseeing ourRisk management of risk, our fulloversight is an essential board responsibility. The board regularly engages in discussions of thediscusses our most significant risks that the Company has identified and how these risks are being managed. The board reviews periodic assessments from the Company’s ongoing enterprise risk management process that areis designed to identify potential events that may affect the achievement of the Company’s objectives or have a material adverse effect on the Company. The board alsoreviews periodic assessments from this process and participates in the Company’s annual risk survey. The board has delegated to its standing committees specific risk oversight responsibilities as set out below and receives regular reports on risk management from senior officers of the Company and from the committee chairs regularly.committees on appropriate areas of risk management.

Risk CommitteeAudit CommitteeCompensation and Human
Capital Committee		Nominating and Corporate
Governance Committee

Oversees management’s identification and evaluation of strategic enterprise risks, including but not limited to risks associated with: technology,with intellectual property, and operations, such as the quality, adequacy and effectiveness of the Company’s data security, privacy, technology, and information security, policies, procedures, and internal controls; cybersecurity and cyber incident response;response, and business continuity and disaster recovery planning and capabilities.

continuity.

Oversees policies with respect to financial risk assessment, including guidelines to govern the process by which major financial and accounting risk assessment and management is undertaken by the Company.

undertaken.

Considers the risks to our business associated with our compensation policies and practices, with respect to both executive compensation and compensation generally.

generally, and considers other human capital risks.

Considers risks related to governance matters, including succession planning for the Chief Executive Officer and other senior officers.

planning.

The board has established a Risk Committee comprised entirely of independent board members to assist in overseeing management’s identificationCompany’s Chief Legal and evaluation of enterprise risks. The Risk Committee met three times during 2018. In addition, the Company’s General Counsel, theCompliance Officer, Chief Information Officer, and the headVice President of the Company’s complianceCompliance and internal audit functions have regularly scheduled individual private meetingsInternal Audit each meet individually with the Risk Committee. Committee on a regular basis.

The Risk Committee also provides an annual update toupdates the full board annually on the Company’s enterprise risk management survey and risk assessment results. The update enables the board to provideprovides feedback to the Company about significant enterprise risks and to assessassesses the Company’s identification of its most significant risk areas. The Risk Committee also coordinates with the Audit Committee as necessary and appropriate to enable the Audit Committee to perform its risk related responsibilities.

The Audit Committee has certain statutory, regulatory, and other responsibilities with respect to oversight ofadditional risk assessment and risk management. Specifically, the Audit Committee is responsible for overseeing policiesoversight responsibilities, specifically with respect to financial risk assessment, including guidelines to governassessment. The Chief Legal and Compliance Officer, CEO, Chief Financial Officer and Vice President of Compliance and Internal Audit each meet individually with the process by which major financial and accounting risk assessment and management is undertaken by the Company.


The board’s other independent committees oversee risks associated with their respective areas of responsibility. For example, the CompensationAudit Committee considers the risks to our business associated with our compensation policies and practices, with respect to both executive compensation and compensation generally. The Nominating and Corporate Governance Committee considers risks related to governance matters, including succession planning for the CEO and other senior officers. For more information about the board’s committees and their responsibilities see page 27.


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In addition, the full board regularly engages in discussions of the most significant risks that the Company has identifiedCompany’s Chief Legal and how these risks are being managed. The Company’s General CounselCompliance Officer reports directly to our Chief Executive Officer,CEO, providing him with visibility into the Company’s risk profile. The head of the Company’s compliance and internal audit functions regularly reports to the Audit Committee, and each of the General Counsel,
Chief Financial Officer and the compliance and internal audit department manager have regularly scheduled private sessions with the Audit Committee. The board believes that the work undertaken by its committees, together with the work of the full board and the Company’s senior management, enables effective oversight of the Company’s management of risk.

Strategic Planning and Oversight

Our board has deep experience and expertise in the area

Oversight of strategy development and has significant oversight of our corporate strategy and long-range operating plans. Acting as a full board and through each independent board committee, the board is fully engaged in the Company’s strategic planning process.

Setting the strategic course of the Company involvesrequires a high level of constructive engagement between management and the board. The Company maintains a process that allows the board to leverage its substantial experience and expertise to remain fully engaged in the Company’s strategic planning process. Management develops and prioritizes strategic plans on an annual basis. Management then reviews these strategic plans with the board duringon an annual board strategy meeting,basis, along with the Company’s challenges, opportunities, industry dynamics, and legal, regulatory and governance developments, amongand other factors.

Management provides the board with comprehensive updates throughout the year regarding progress on the implementation and resultsCompany’s strategic plans. Management also provides regular updates regarding the achievement of the Company’s strategic plans, as well as monthly updates

regarding the Company’s financial performance.goals. In addition, the CEO communicates regularly with the board on important business opportunities, financial and operational performance matters, risks and other Company developments such as labor and customer relations, customer interactionsboth during and media coverage.outside the regular board meeting cycle.

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This process allows the board to understand and impact the Company’s strategic plans, including plans related to returnTable of capital to shareowners, mergers and acquisitions, competitive challenges, changing marketplace conditions and operational technologies. As a result, the board has substantial oversight of the development and implementation of the Company’s strategic plans and the board is able to effectively monitor the Company’s progress with respect to the strategic goals and objectives.Contents


Corporate Governance

Management Succession Planning and Development


Succession planning and talent development are important at all levels within our organization. The board oversees management’s emergency and long-term succession plan for key positionsplans at the seniorexecutive officer level, and most importantly for the Chief Executive OfficerCEO position. The board annually reviews succession plans for senior management including the CEO, all in the context of the Company’s overall business strategy and with a focus on risk management. More broadly, the board and the CEO,Compensation and Human Capital Committee are regularly updated on key talent indicators for the overall workforce, including both a long-term succession plandiversity, recruiting and an emergency succession plan. development programs.

The board’s succession planning activities are ongoing and strategic and may beare supported by board committees and independent third-party consultants.consultants as needed. In addition, the CEO annually provides hisan assessment to the board of senior leaders and their potential to succeed at key senior management positions. Recently, the board supported the hiringAs a part of external

senior executive talent to participate in the transformation of our business. This led to the employment of the Company’s first Chief Transformation Officer, Scott Price, and the hiring of our Chief Marketing Officer, Kevin Warren, during 2018.

The board also regularly evaluates succession plans in the context of the Company’s overall business strategy and with a focus on risk management. Potentialthis process, potential leaders interact with board members through formal presentations and during informal events. More broadly,

We also utilize a formal director engagement program in which directors meet with individual executive officers, visit Company operations, participate in employee events and receive in-depth subject matter updates outside of the regular board is regularly updated on key talent indicators formeeting process. These additional engagements encourage the overall workforce, including diversity, recruitingongoing exchange of ideas and development programs.information between directors and management, facilitate the board’s oversight responsibilities, and support succession planning efforts.


MeetingMeetings and Attendance


The board held 5five meetings during 2018.2021. Also, during 2018,2021, the Audit Committee met 10ten times, the Compensation and Human Capital Committee met 5five times, the Nominating and Corporate Governance Committee met 4four times and the Risk Committee met 3three times. A typical UPS board meeting occurs over the course of two days.The Executive Committee met one time in 2021. Prior to board meetings, the board meeting, the lead independent directorBoard Chair and the board’s committee chairs work with management to determine and prepare agendas for the meetings. The boardBoard meetings generally occur over two days. Board committees generally meet on the first day of the board meeting, followed

by the board meeting and a dinner. The board dinner presents opportunities for continued discussions or questions, interactions with senior management and exposure to high potential employees.meeting. The second day typically consists of reports from each committee chair to the full board, additional presentations by internal business leaders or others with expertise in various subject matters, and an executive session consisting of only independent board members. The executive sessions of independent directors are chaired by our lead independent director.

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Our directors are diligent with respect to meeting attendance. In the rare instances when a director cannot attend a meeting in person, they participate by teleconference. All of our directors attended at least 75%100% of the total number of board and any committee meetings of which he or she was a member in 2018.
2021. Our directors are expected to attend each annual meeting, and all directors who were then members of the board attended the 20182021 Annual Meeting. The independent directors met in executive session at all of the board meetings held in 2018.

2021.

Code of Business Conduct

We are committed to conducting our business in accordance with the highest ethical principles. Our Code of Business Conduct is applicable to anyone who represents UPS, including our directors, executive officers and all other employees and agents of UPS. A copy of our Code of Business Conduct is available on the governance section of our investor relations website at www.investors.ups.com.

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Conflicts of Interest and Related Person Transactions

Our Audit Committee is responsible for overseeing our Code of Business Conduct, which includes policies regarding conflicts of interest. The Code requires employees and directors to avoid conflicts of interest, defined as situations where the person’s private interests conflict, or may appear to conflict, with the interests of UPS.

The board has adoptedWe maintain a written related person transactions policy that applies to any transaction or series of transactions in which: (1) the Company or any of its subsidiaries is a participant; (2) any “related person” (executive officer, director, greater than 5% beneficial owner of the Company’s common stock, or an immediate family member of any of the foregoing) has or will have a material direct or indirect interest; and (3) the aggregate amount involved since the beginning of the Company’s last completed fiscal year will exceed or may reasonably be expected to exceed $100,000.

The policy provides that related person transactions that may arise during the year are subject to the Audit Committee approval or ratification.Committee’s reasonable prior approval. In determining whether to approve or ratify a transaction, the Audit Committee will consider, among other factors it deems appropriate, whether the transaction is on terms no less favorable than terms generally available to an unaffiliated third-party under the same or similar circumstance, the extent of the related person’s interest in the transaction, whether the transaction would impair

independence of a non-employee director and whether there is a business reason for UPS to enter into the transaction. A copy of the policy is available on the governance section of our investor relations website at www.investors.ups.com. The Company did not engage in any related person transactions since January 1, 20182021 that requiredrequire disclosure in this Proxy Statement or under the Company’s policy.

At least annually, each director and executive officer completes a detailed questionnaire that disclosesin which they are required to disclose any business relationships that may give rise to a conflict of interest, including transactions where UPS is involved and where an executive officer, a director or a related person has a direct or indirect material interest. We also review the Company’s financial systems and any related person transactions to identify potential conflicts of interest. The Nominating and Corporate Governance Committee reviews thea summary of this information from the questionnaire and our financial systems and makes recommendations to the Board of Directors regarding the independence of each board member.member’s independence. We have immaterial normalordinary course of business transactions and relationships with companies with which our directors are associated. The Nominating and Corporate Governance Committee reviewed the transactions and relationships that occurred since January 1, 20182021 and believes they were entered into on terms that are both reasonable and competitive and did not affect director independence. Additional transactions and relationships of this nature may be expected to take place in the ordinary course of business in the future.


Transactions in Company Stock


We prohibit our executive officers and directors from hedging or pledging their ownership in UPS stock. Specifically, they are prohibited from purchasing or selling derivative securities relating to UPS stock and from purchasing financial instruments that are designed to hedge or offset any decrease in the market value of UPS securities. Since 2014 we have prohibited our executive officers and directors from entering into pledges of UPS stock.

Furthermore, our employees, officers, and directors are prohibited from engaging in short sales of UPS stock. A “short sale” is one involving securities that the seller does not own at the time of sale or, if the securities are owned, where they will be delivered on a delayed basis. Selling securities “short” is consistent with an expectation that the price of the securities will decline in the near future, is often speculative in nature, and may have an adverse effect on the market price of the securities being sold.


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Corporate Governance

Stakeholder Engagement

Shareowner Engagement

Responsiveness to Shareowners

During this proxy season,Maintaining open and honest dialogs with our stakeholders is an important component of our corporate culture. Our management team participates in numerous investor meetings throughout the year to discuss our business, strategy and financial results. This includes in-person, telephone and webcast conferences, as well as key site visits. Our Investor Relations team shares feedback and provides regular updates to the board on investor sentiment.

In addition, each year we undertake an Environmental, Social and Governance (“ESG”) stakeholder outreach program in which we discuss progress on our ESG journey. This year we contacted holders of over 43%47% of our class B common stock to discuss our corporate governance practices and executive compensation programs. as a part of this program.

We also proactively correspond with other key investorsstakeholders throughout the year. We share feedback from these engagements with the board, the Compensation and Human Capital Committee, and the Nominating and Corporate Governance Committee as appropriate.

     

We have taken into accountconsider the views of our shareowners and other stakeholders when making many ofevaluating our governanceESG policies and disclosure decisionspractices; for example, in recent years including:

we have:

The Compensation Committee’s consideration ofand Human Capital Committee considers shareowner feedback, along with the market information and analysis provided by its independent compensation consultant, have influenced a number of changes towhen making decisions about our executive compensation program over the past several years:

programs. We have:
 
●Proactively adopting
Announced a carbon neutral by 2050 goal, including several shorter and medium term goals;
●
Expanded our sustainability disclosure, including publishing GRI, TCFD and SASB reports;
●
Increased our commitments to diversity, equity and inclusion, volunteerism and charitable giving;
●
Separated the Board Chair and CEO roles;
●
Appointed an independent Board Chair;
●
Increased board diversity;
●
Adopted policies providing for an annual say on pay vote;
●
Adopted proxy access; and
●Appointing a lead independent director;
●Adopting prohibitions on hedgingRevised the Compensation and pledgingHuman Capital Committee charter to include oversight of Company stock by executive officersperformance and directors;
●Expanding disclosure about the board’s role in strategic planning;
●Enhancing disclosuretalent management, diversity, equity and governance regarding political contributions;
●Expanding sustainability disclosure;
●Enhancing disclosure about board refreshmentinclusion, work culture and board succession planning, as well as our board self-evaluation process;
●Enhancing disclosure about diversity;
●Expanding the Audit Committee’s report in the proxy statement;employee development and
●Updating the presentation of our proxy statement to enhance readability and understanding by our shareowners. retention.
●Increasing
Updated the peer group used by the Committee for executive and director compensation market comparisons;
●
Enhanced the performance-based equity component in our compensation program;programs;
●Eliminating
Eliminated single-trigger equity vesting following a change in control;
●Adding
Added relative total shareowner return as a metric incomponent of our Long-Term Incentive Plan;Plan awards;
●Providing
Adopted performance metrics under incentive compensation plans better designed to tie payouts to increases in shareholder value;
●
Provided additional detail around the performance measures used for our annual and long-term incentive plans;
●Eliminating
Eliminated tax gross-ups;
●Adding
Entered into protective covenant agreements in favor of UPS with certain executive officers; and
●
Added an individual payout cap to our annual incentive plan; and
●Enhancing executive compensation disclosure, including how the metrics in our Long-Term Incentive Plan align with long-term value creation for our shareowners.plan.

Shareowner engagement is an essential aspect of corporate governance. We are receptive to shareowner engagement, and we are committed to transparency and proactive interactions with our investors.

Our management team participates in numerous investor meetings throughout the year to discuss our business, our strategy and our financial results. These meetings include in-person, telephone and webcast conferences, as well as headquarters and facility visits within the United States and in key international locations. In addition, our lead independent director meets with our largest shareowners to answer questions and to provide perspective on the Company’s culture and governance practices.

We inform our board through the Compensation Committee and our Nominating and Corporate Governance Committee about our conversations with key investors concerning our executive compensation and governance practices. Our directors carefully consider feedback from institutional investors and other shareowners. The Compensation Committee also annually engages an independent compensation consultant to review executive compensation trends that may be important to our investors.

Materials from our investor presentations, including information on the work of our board and its committees, are available on our investor relations website at www.investors.ups.com.


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Table of Contents

Communicating with ourthe Board of Directors

Any shareowners or other interested parties who wish to

Stakeholders may communicate directly with ourthe board, with ourthe non-management directors as a group, or with the lead independentany specific director, may do so by writing to the UPS Corporate Secretary, 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328. Please specify to whom your letter should be directed. After review by the Corporate Secretary,

appropriate communications will be promptly forwarded to the addressee. Advertisements, solicitations for business, requests for employment, requests for contributions, matters that may be better addressed by management or other inappropriate materials will not be forwarded to our directors.forwarded.

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Table of Contents

Political Contributions and Lobbying

Overview

Our responsibleOverview

Responsible participation in the U.S. political process is important to theour success of our business and the protection of shareowner value. We participate in this process in accordance with good corporate governance practices. Our Political Contributions and Lobbying Policy (“policy”) is summarized below and is available at www.investors.ups.com. The following discussion highlights our practices

●The Nominating and Corporate Governance Committee oversees the policy;
●Corporate political contributions are restricted;
●We publish a semi-annual political contribution report on our investor relations website; and
●Eligible employees can make political contributions through a Company-sponsored political action committee (UPSPAC). UPSPAC is organized and operated on a voluntary, nonpartisan basis and is registered with the Federal Election Commission.

Oversight and procedures regarding politicalProcesses

●Political contributions are made in a legal, ethical and transparent manner that best represents the interests of stakeholders.
●Political and lobbying activities require prior approval of the UPS Public Affairs department and are subject to review (and in some cases prior approval) by the Nominating and Corporate Governance Committee.
●Senior management works with Public Affairs on furthering our business objectives and protecting and enhancing shareowner value.
●The Chief Corporate Affairs Officer reviews political and lobbying activities and regularly reports to the board and the Nominating and Corporate Governance Committee.

Lobbying and lobbying:Trade Associations

●Our policy is overseen by the Nominating and Corporate Governance Committee, a committee composed entirely of independent directors;
●As a general matter, UPS does not make corporate political contributions;
●Any deviations from the prohibition against corporate political contributions must be approved by the Nominating and Corporate Governance Committee and reported in UPS’s semi-annual political contribution report; and
●UPS offers certain eligible employees the opportunity to make political contributions through a company-sponsored political action committee, called the UPS Political Action Committee, or UPSPAC. The UPSPAC is organized and operated on a strictly voluntary, nonpartisan basis and is registered with the Federal Election Commission.


Oversight●Public Affairs coordinates our lobbying activities, including engagements with federal, state, and Processeslocal governments. UPS is also a member of a variety of trade associations and other tax-exempt organizations that engage in lobbying.
●Lobbying activities require prior approval of Public Affairs.
●The Nominating and Corporate Governance Committee regularly reviews UPS’s participation in trade associations and other tax-exempt organizations that engage in lobbying to determine if our involvement is consistent with UPS business objectives and whether participation exposes the Company to excessive risk.
●Lobbying activities are governed by comprehensive policies and practices designed to facilitate compliance with laws and regulations, including those relating to the lobbying of government officials, the duty to track and report lobbying activities, and the obligation to treat lobbying costs and expenses as nondeductible for tax purposes.

Political contributions are made in a legal, ethical and transparent manner that we believe best represents the interests of our shareowners. All political and lobbying activities are conducted only with the prior approval of our Public Affairs department and in accordance with the terms of our policy. Senior management works with Public Affairs to focus our involvement at all levels ofActivity Transparency

government on furthering our business objectives and our goals of protecting and enhancing shareowner value. The president of our Public Affairs department reviews all UPS political and lobbying activities and regularly reports to the board and to the Nominating and Corporate Governance Committee.


●We are transparent in our political activities.
●We publish a semi-annual report, which is reviewed and approved by the Nominating and Corporate Governance Committee.
●The report provides:
●Amounts and recipients of any federal and state political contributions in the United States (if any such expenditures are made); and
●Payments to trade associations that receive $50,000 or more and that use a portion of the payment for political contributions, as reported by the trade association to us.
●The report is available on our investor relations website at www.investors.ups.com
●We also publicly file a federal Lobbying Disclosure Act Report each quarter, providing information on activities associated with influencing legislation through communications with any member or employee of a legislative body, or with any covered executive branch official. This report discloses expenditures for the quarter, describes the specific pieces of legislation that were the topic of communications, and Trade Associationsidentifies the individuals who lobbied on behalf of UPS. UPS files similar publicly available periodic reports with state agencies reflecting state lobbying activities.

Our Public Affairs department is responsible for coordinating our lobbying activities, including engagements with federal, state, and local governments. UPS is a member of a variety of trade associations and other tax exempt organizations that engage in lobbying. The Company may participate in lobbying activities when involvement is consistent with specific UPS business objectives. These decisions are subject to board oversight and are regularly reviewed by the Nominating and Corporate Governance Committee.

●In accordance with the terms of our policy, all lobbying activities are conducted only with the prior approval of our Public Affairs department, which works with senior management to focus on furthering our business objectives and our goal of protecting and enhancing shareowner value.
●The Nominating and Corporate Governance Committee regularly reviews UPS’s participation in trade associations and other tax exempt organizations that engage in lobbying to determine if our involvement is consistent with specific UPS business objectives.

We have comprehensive policies, practices and tracking mechanisms to support and govern our lobbying activities. These mechanisms cover compliance with laws and regulations regarding the lobbying of government officials, the duty to track and report lobbying activities, and the obligation to treat lobbying costs and expenses as nondeductible for tax purposes. All lobbying contacts with covered government officials must be coordinated with and approved by the president of our Public Affairs department.



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Corporate Governance

Sustainability

Transparency

We are committed to meaningful transparency with respect tothe world’s premier package delivery company and a leading provider of global supply chain management solutions. We offer a broad range of industry-leading products and services through our political activities. We publish a semi-annual report disclosingextensive presence in North America; Europe; the following information at our investor relations website at www.investors.ups.com, all of which is reviewedIndian sub-continent, Middle East and approved by the Company’s NominatingAfrica (“ISMEA”); Asia Pacific and Corporate Governance Committee prior to publication:

●AmountsLatin America. Our services include transportation and recipients of any federaldelivery, distribution, contract logistics, ocean freight, air freight, customs brokerage and state political contributions made by UPS in the United States (if any such expenditures are made); and
●Payments to trade associations that receive $50,000 or more from UPS and that use a portion of the payment for political contributions, as reported by the trade association to UPS.

UPS also files a publicly available federal Lobbying Disclosure Act Report each quarter, providing information on activities associated with influencing legislation through communications with any member or employee of a legislative body or with any covered executive branch official. The report also provides disclosure on expenditures for the quarter, describes the specific pieces of legislation that were the topic of communications, and identifies the individuals who lobbied on behalf of UPS.insurance.

UPS files similar periodic reports with state agencies reflecting state lobbying activities which are also publicly available.


Sustainability

We areoperate one of the world’s largest private employers.airlines and one of the largest fleets of alternative fuel vehicles under a global UPS brand that stands for quality and reliability. We serve millions ofdeliver packages each business day for approximately 1.7 million shipping customers around the world, we operateto 11.8 million delivery customers in more thanover 220 countries and territories, and many investors include our shares in their portfolios.territories. In 2021, we delivered an average of 25.2 million packages per day, totaling 6.4 billion packages during the year. Our success depends on economic stability, global trade and a society that welcomes opportunity. We understand the importance of acting responsibly as a business, an employer and a corporate citizen.

Engagement onEconomic, environmental and social sustainability issues is importantrisks and opportunities are considered as part of our comprehensive enterprise risk management program. The board regularly reviews the effectiveness of our risk management and due diligence processes related to our stakeholders. Ourmaterial sustainability topics. In addition, the board actively considers these factors in connection with the board’s involvement in UPS’s strategic planning process. The board delegates authority for day-to-day management of economic, environmental, and socialsustainability topics to UPS management. TheOur Chief Corporate Affairs Officer reports directly to the Company’s CEO and regularly reports to the board oversees economic, environmentalregarding sustainability strategies, priorities, goals and social issues and is in touch with stakeholder concerns through a number of processes. For example,performance. In addition, the board is regularly briefed on issues of concern for customers, unions, employees, retirees, investors and investors.other stakeholders. Furthermore, the board oversees all efforts by UPS management to developmanagement’s development of our values, strategies and policies related to economic, environmental and social impacts.

UPS was among the first Fortune 100 companies to appoint a chief sustainability officer. Our chief sustainability officer regularly reports to the board regarding sustainability strategies, priorities, goals, and performance. In addition, members of the board review the contents of our sustainability report each year and provide feedback to the Company.

Economic, environmental and social risks are part of our comprehensive enterprise risk management program. The board reviews the effectiveness of our risk management and due diligence processes related to economic, environmental, and social topics. In addition, the board actively considers economic, environmental and social issues in connection with the board’s involvement in UPS’s strategic planning process.

Each year we publish a corporate sustainability report showcasing the aspirations, achievements, and challenges of our commitment to balancing the social, economic and environmental aspects of our business. The report is availablereviewed by the board prior to publication. Following is a list of key goals:

By 2022:
 ●28% women in full-time management globally
●35% ethnically diverse full-time management in the U.S.
By 2025:
 ●40% alternative fuel in ground operations
 ●25% renewable electricity in facilities
By 2030:
 ●30 million volunteer hours (2011 baseline)
 ●50 million trees planted (2012 baseline)
By 2035:
●30% sustainable aviation fuel
●50% reduction in CO2 per global small package (2020 baseline)
 ●100% renewable electricity in facilities
By 2050:
 ●Achieve carbon neutrality

For more information, please visit www.about.ups.com. Our ESG goals are aspirational and may change. Statements regarding our goals are not guarantees or promises that they will be met.

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Human Capital Management

Our success is dependent upon our people, working together with a common purpose. We have approximately 534,000 employees (excluding temporary seasonal employees), of which 444,000 are in the U.S. and 90,000 are located internationally. Our global workforce includes approximately 89,000 management employees (44% of whom are part-time) and 445,000 hourly employees (51% of whom are part-time). More than 70% of our U.S. employees are represented by unions, primarily those employees handling or transporting packages. In addition, approximately 3,100 of our pilots are represented by the Independent Pilots Association.

We believe that UPS employees are among the most motivated, highest-performing people in the industry and provide us with a meaningful competitive advantage. To assist with employee recruitment and retention, we continue to review the competitiveness of our employee value proposition, including benefits and pay, the range of continuous training, talent development and promotional opportunities.

Oversight and management

We are creating an inclusive and equitable environment that brings together a broad spectrum of backgrounds, cultures and stakeholders. Leveraging diverse perspectives and creating inclusive environments improves our organizational effectiveness, cultivates innovation, and drives growth.

Our Board of Directors and its committees provide oversight on human capital matters through a variety of methods and processes. These include regular updates and discussion around human capital transformation efforts, technology initiatives impacting the workforce, health and safety matters, employee survey results related to culture and other matters, hiring and retention, employee demographics, labor relations and contract negotiations, compensation and benefits, succession planning and employee training initiatives.

In addition, the Compensation and Human Capital Committee charter was expanded last year to include oversight of performance and talent management, diversity, equity and inclusion, work culture and employee development and retention. We believe the board’s oversight of these matters helps identify and mitigate exposure to labor and human capital management risks, and is part of the broader framework that guides how we attract, retain and develop a workforce that aligns with our values and strategies.

Total rewards

We offer competitive compensation and benefits. In addition, our long history of employee stock ownership aligns the interests of our management team with shareowners. In the U.S., benefits provided to our non-union employees typically include:

●comprehensive health insurance coverage;
●life insurance;
●short- and long-term disability coverage;
●child/elder care spending accounts;
●work-life balance programs;
●an employee assistance program; and
●a discounted employee stock purchase plan.

We invest in our people by offering a range of other benefits, such as paid time off, retirement plans, and education assistance. In the U.S., these other benefits are generally provided to non-union employees without regard to full-time or part-time status.

Transformation and human capital

As we expand and enter new markets, and seek to capture new opportunities and pursue growth, we need employees to grow and innovate along with us. We believe that transforming the UPS employee experience is foundational to our success. This requires a thoughtful balance between the culture we have cultivated over the years and the new perspectives we need to take the business into the future. This investment in capabilities to transform our business includes investing in employee growth opportunities such as professionalism, technical and other training.

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Corporate Governance

Employee health and safety

We are committed to industry-leading employee health, safety, and wellness programs across our workforce. We develop a culture of health and safety by:

●investing in safety training and audits;
●promoting wellness practices which mitigate risk; and
●offering benefits that keep employees safe in the workplace and beyond.

Our local health and safety committees coach employees on UPS’s safety processes and are able to share best practices across work groups. Our safety methods and procedures are increasingly focused on the variables associated with residential delivery environments, which have become more common with the growth in e-commerce. We monitor our performance in this area through various measurable targets including lost time injury frequency and the number of recorded auto accidents.

Collective bargaining

We bargain in good faith with the unions that represent our employees. We frequently engage union leaders at www.sustainability.ups.com.the national level and at local chapters throughout the United States. We participate in works councils and associations outside the U.S., which allows us to respond to emerging regional issues abroad. This work helps our operations to build and maintain productive relationships with our employees.


Corporate Governance Guidelines and Committee Charters

Our Corporate Governance Guidelines and the charters for each of the board’s committees are available on the governance section of our investor relations website at www.investors.ups.com. The charters for each of the Audit Committee, Compensation Committee, Nominating and Corporate Governance Committee and Risk Committee also are available on the governance section of our investor relations website. Each committee reviews its charter annually to determine if any

changes are needed.annually. In addition, the Nominating and Corporate Governance Committee reviews theour Corporate Governance Guidelines on an annual basisannually and recommends any changes to the board for approval. When making changes to theamending our committee charters or Corporate Governance Guidelines, we consider current governance trends and best practices, changes in regulatory requirements, advice from outside sources and input from our investors.stakeholders.


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Our Board of Directors

Our Board of Directors

Proposal 1 — Director Elections

What am I voting on?Shareowners are being asked to electElection of each of the 1213 named director nominees named in this Proxy Statement to hold office until the 20202023 Annual Meeting and until their respective successors are elected and qualified.

VotingBoard’s Recommendation:The Board of Directors recommends that shareowners vote Vote FOR the election of each nominee.

Vote Required:A director will be elected if the number of votes cast FORfor that director exceeds the number of votes AGAINSTcast against that director.

The board has nominated the 12 persons named below for election as directors at the Annual Meeting. TheIf elected, all nominees will serve until the next Annual Meeting and until their respective successors are elected and qualified. Each nominee wasAll nominees were elected by shareowners at our last Annual Meeting. If any nominee is unable to serve as a director, which we do not anticipate, the board may reduce the number of directors that serve on the board or choose a substitute nominee. Any nominee who is currently a director, and for whom more votes are cast against than are cast for, must offer to resign from the board. Current director

Candace Kendle’s board service will conclude at the 2019 Annual Meeting. We thank her for her many years of dedicated service to the Company and the Board of Directors.

Biographical information about the director nominees for director appears below, including information about the experience, qualifications, attributes, and skills considered by our Nominating and Corporate Governance Committee and board in determining that the nominee should serve as a director. For additional information about how we identify and evaluate nominees for director, see “Corporate Governance — Selecting Director Nominees” on page 10.


David P. AbneyCarol Tomé

UPS Chairman and
Chief Executive Officer

Career

Carol was appointed UPS’s Chief Executive Officer effective June, 2020. As CEO, Carol has primary responsibility for managing the Company’s day-to-day operations, and for developing and communicating our strategy. She was Chief Financial Officer of The Home Depot, Inc., one of the world’s largest retailers, from 2001; and Executive Vice President Corporate Services from 2007 until her retirement in 2019. At The Home Depot, she provided leadership in the areas of real estate, financial services and strategic business development. Her corporate finance duties included financial reporting and operations, financial planning and analysis, internal audit, investor relations, treasury and tax. She previously served as Senior Vice President Finance and Accounting and Treasurer from 2000 until 2001; and from 1995 until 2000 she served as Vice President and Treasurer.

Carol serves on the Board of Directors for Verizon Communications, Inc. and served on the Board of Directors of Cisco Systems, Inc. until 2020. She also served as a Trustee of certain Fidelity funds in 2017.

Reasons for election to the UPS Board

Carol has a thorough understanding of our strategies and operations as a result of serving as Chief Executive Officer, and from her extensive experience gained from serving on the board and as Chair of the Audit Committee prior to becoming Chief Executive Officer. She has an in-depth knowledge of logistics and has broad experience in corporate finance and risk and compliance gained throughout her career at The Home Depot. She brings the experience of having served as Chief Financial Officer of a complex, multi-national business with a large, labor intensive workforce. Carol also has experience with strategic business development, including e-commerce strategy.

Age: 6365

Director since 2014

2003

Skills and Experience

-Leadership

CEO experience

-Management of large, complex businesses

CFO experience

-Logistics expertise

Consumer retail

- Digital technology

- Risk and compliance

Other Public Company Boards

-Macy’s, Verizon Communications, Inc.

Board Committee

-Executive (Chair)






Career

David became UPS’s Chief Executive Officer in 2014, and assumed the role of Chairman of the Board of Directors in 2016. David previously served as chief operating officer since 2007, overseeing logistics, sustainability, engineering and all facets of the UPS transportation network. Before serving as COO, David was president of UPS International, leading the company’s strategic initiative to increase its global logistics capabilities. During his career, he was also involved in a number of global acquisitions that included the Fritz Companies, Stolica, Lynxs, and Sino-Trans in China. Earlier in his career, he served as president of SonicAir, a same-day delivery service that signaled UPS’s move into the service parts logistics sector. David began his UPS career in 1974 in Greenwood, Mississippi.

In addition to his corporate responsibilities, David serves as a Trustee of The UPS Foundation and as a Trustee of the Annie E. Casey Foundation. He is the 2019 Chair Elect, Executive Governing Committee Member of the Metro Atlanta Chamber of Commerce, is the former Chairman and current member of the World Affairs Council of Atlanta, and is a member of the Business Roundtable. David currently serves as a board member of the nonprofit organization, Catalyst. He joined the Board of Directors of Macy’s, Inc. in 2018. He served on the Board of Directors of Johnson Controls International plc, until 2018.

Reasons for election to the UPS Board

David has a thorough understanding of our strategies and operations gained through his over 40 years of service to our Company, a complex, global business enterprise with a large, labor-intensive workforce. He has significant experience in operations, having served as our Chief Operating Officer for more than seven years, including in-depth knowledge of logistics. He also has significant international experience, having spent a number of years overseeing our international group. In addition, David has experience serving as a director of other companies, including Johnson Controls, a global diversified technology and industrial company serving customers in more than 150 countries, and Macy’s, one of the nation’s premier retailers.


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Our Board of Directors

Rodney C. Adkins

Former Senior Vice
President, International
Business Machines Corporation

Career

Rod is President of 3RAM Group LLC, a private company specializing in capital investments, business consulting and property management services. Prior to that role, Rod served as IBM’s Senior Vice President of Corporate Strategy before retiring in 2014. Rod was previously Senior Vice President, Systems and Technology Group, a position he held since 2009, and senior vice president of STG development and manufacturing, a position he held since 2007. In his over 30-year career with IBM, a multinational technology company, Rod held a number of other development and management roles, including general management positions for the PC Company, UNIX Systems and Pervasive Computing.

Rod currently serves as non-executive Chairman of Avnet, Inc., in addition to serving on the Boards of Directors for PayPal Holdings, Inc. and W.W. Grainger, Inc. He also served on the Board of Directors for PPL Corporation until 2019.

Reasons for election to the UPS Board

As a senior executive of a public technology company, Rod gained a broad range of experience, including experience in emerging technologies and services, global business operations, and supply chain management. He is a recognized leader in technology and technology strategy. In addition, Rod has experience serving as a director of other publicly traded companies.

Age: 6063

Director since 2013

Skills and Experience

- Digital technology

- Risk and compliance

- Supply chain management

- Technology and technology strategy

-Global business operations
-Supply chain management

Other Public Company Boards*

Boards

-Avnet, Inc.

-PayPal Holdings, Inc.

-PPL Corporation

-W.W. Grainger, Inc.

Board Committees

-Risk (Chair)

-Compensation

and Human Capital

Career

Rod is President of 3RAM Group LLC, a private company specializing in capital investments, business consulting and property management services.  Rod previously served as  IBM’s Senior Vice President of Corporate Strategy before retiring in 2014. Rod was previously Senior Vice President, Systems and Technology Group, a position he held since 2009, and senior vice president of STG development and manufacturing, a position he held since 2007. In his over 30-year career with IBM, a multinational technology company, Rod held a number of other development and management roles, including general management positions for the PC Company, UNIX Systems and Pervasive Computing.

Rod currently serves as non-executive Chairman of Avnet, Inc., in addition to serving on the Boards of Directors of PayPal Holdings, Inc. and W.W. Grainger, Inc. He also serves on the Board of Directors of PPL Corporation.

Reasons for election to the UPS Board

As a senior executive of a public technology company, Rod gained a broad range of experience, including experience in emerging technologies and services, global business operations, and supply chain management. He is a recognized leader in technology and technology strategy. In addition, Rod has experience serving as a director of other publicly traded companies.

* Rod has informed us that, as of May 2019, he will be serving on no more than three other public company boards of directors.

Michael J. BurnsEva Boratto

Chief Financial Officer, Opentrons Labworks, Inc.

Career

Eva is the Chief Financial Officer for Opentrons Labworks, Inc., a private disruptive biotechnology company leveraging its integrated lab platform to accelerate the pace of innovation in life sciences. She has served in this role since February 2022. Eva will also serve on Opentrons’ Board of Directors.

Eva served as Executive Vice President and Chief Financial Officer for CVS Health Corporation, a diversified health services company, from 2018 until her retirement in 2021. In this role, Eva was responsible for all aspects of the company’s financial strategy and operations, including accounting and financial reporting, investor relations, mergers and acquisitions, treasury and capital planning, investments, risk management, tax, budgeting and planning, and procurement.

Prior to this role, from 2017 to 2018, Eva was Executive Vice President, Controller and Chief Accounting Officer for CVS Health. She served as Senior Vice President and Chief Accounting Officer of CVS Health from 2013 to 2017. Eva joined the company in 2010 and served as Senior Vice President for pharmacy benefit management finance until 2013.

Reasons for election to the UPS Board

Eva has extensive experience in corporate finance gained throughout her career at CVS Health. She also brings the experience of having served as Chief Financial Officer of a complex healthcare business with a large workforce and extensive retail presence, including deep knowledge of financial reporting and accounting standards. Eva also has experience with strategic risk management and provides significant expertise in healthcare matters.

Age: 55

Director since 2020

Skills and Experience

- CFO experience

- Consumer retail

- Healthcare

- Risk and compliance

Board Committee

- Audit (Chair)







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Michael Burns

Former Chairman, Chief
Executive Officer and
President, Dana CorporationIncorporated

Age:Career 67

Director since 2005
Skills and Experience
-Leadership
-Management of large, complex businesses
-Design, engineering, manufacturing, sales and distribution
-Technology
Board Committee
-Audit
Career

Mike was the Chairman, Chief Executive Officer and President of Dana Corporation from 2004 until his retirement in 2008. He joined Dana Corporation in 2004 after 34  years with General Motors Corporation. Mike had served as President of General Motors Europe since 1998.

Reasons for election to the UPS Board

Mike has years of senior leadership experience gained while managing large, complex businesses and leading an international organization that operated in a highly competitive industry. He also has experience in design, engineering, manufacturing, and sales and distribution. Mike also brings deep knowledge of technology and the supply of components and services to major vehicle manufacturers.


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William R. Johnson

UPS Lead Director

Former Chairman,
President and Chief Executive
Officer of H.J. Heinz CompanyDana Incorporated, a global manufacturer of technology driveline, sealing and thermal-management products, from 2004 until his retirement in 2008. He joined Dana Incorporated in 2004 after 34 years with General Motors Company. During his tenure at General Motors, Mike held various positions of increasing responsibility, including serving as President of General Motors Europe AG from 1998 to 2004.

Reasons for election to the UPS Board

Mike has years of senior leadership experience gained while managing large, complex businesses and leading an international organization that operated in a highly competitive industry. He also has experience in design, engineering, manufacturing, and sales and distribution. Mike also brings deep knowledge of technology and the supply of components and services to major vehicle manufacturers.

Age:70

Director since 2009
-Lead

Director since 2016

2005

Skills and Experience

- CEO experience

- Global perspective, international

- Operations

- Technology and technology strategy

Board Committee

- Audit

-Wayne Hewett

Senior Advisor to Permira and Non-Executive Chairman, Cambrex Corporation

Career

Since 2018, Wayne has served as a senior advisor to Permira, a global private equity firm, and since 2020, as Non-Executive Chairman of Cambrex Corporation, a leading contract developer and manufacturer of active pharmaceutical ingredients and a private portfolio company of Permira Funds. In addition, since 2021, he has served as a director of Lytx, a telematics solutions provider and a portfolio company of Permira Funds. From 2018 to 2021, Wayne also served as Non-Executive Chairman of DiversiTech Corporation, a manufacturer and supplier of HVAC equipment.

Wayne served as Chief Executive Officer and as a member of the Board of Directors, of Klöckner Pentaplast Group, a leading supplier of plastic films for pharmaceutical, medical devices, food and other specialty applications, from 2015 to 2017. He also served as President and as a member of the Board of Directors, of Platform Specialty Products Corporation during 2015, and as President, Chief Executive Officer and as a member of the Board of Directors of Arysta LifeScience Corporation from 2010 to 2015. Arysta was acquired in 2015 by Platform Specialty Products Corporation.

Prior to joining Arysta, he served as a senior consultant to GenNx360, a private equity firm focused on sponsoring buyouts of middle market companies. He also spent over two decades at General Electric Company, serving in a variety of executive roles.

Wayne currently serves on the Boards of Directors of The Home Depot, Inc. and Wells Fargo, Inc.

Reasons for election to the UPS Board

Wayne has extensive experience in general management, finance, supply chain, operational and international matters gained through serving in various executive roles. He has significant experience executing company-wide initiatives across large organizations, developing proprietary products, optimizing supply chains, and using emerging technologies to provide new products and services. He brings insights on business operations and risk management through his senior management roles. In addition, Wayne has valuable experience serving as a director of other publicly traded companies.

Age: Leadership57

-Management of large, complex businesses
-Operations experience
-Marketing

Director since 2020

Skills and brand development

Experience

-Logistics

CEO experience

- Global perspective, international

- Healthcare

- Operations

- Supply chain management

Other Public Company Boards

-PepsiCo, The Home Depot, Inc.

- Wells Fargo, Inc.

Board Committees

Committee

-Nominating and Corporate Governance (Chair)

-Executive
Audit









Career

Bill served as Chairman, President and Chief Executive Officer of the H.J. Heinz Company, a global packaged foods manufacturer, from 2000 until his retirement in 2013. He became President and Chief Operating Officer of Heinz in 1996, and assumed the position of President and Chief Executive Officer in 1998.

Bill also serves on the Board of Directors of PepsiCo, Inc. He served on the Boards of Directors of Education Management Corporation until 2014 and Emerson Electric Company until 2017.

Reasons for election to the UPS Board

Bill has significant senior management experience gained through over 13 years of service as the Chairman and Chief Executive Officer of H.J. Heinz, a corporation with significant international operations and a large, labor intensive workforce. He also has deep experience in operations, marketing, brand development and logistics.


24   

Ann M. Livermore

Former Executive Vice President,
Hewlett Packard Company

Age: 60
Director since 1997
Skills and Experience
-Management of large, complex businesses
-Technology strategy
-Sales and marketing
Other Public Company Boards
-Hewlett Packard Enterprise Company
-Qualcomm Incorporated
Board Committees
-Compensation (Chair)
-Risk
-Executive
Career

Ann serves as a director of the Hewlett Packard Enterprise Company, after retiring as an executive of Hewlett Packard  in 2011. In her last operational role at HP, Ann was Executive Vice President of the HP Enterprise Business. Ann joined HP in 1982 and has held a variety of management positions in marketing, sales, research and development, and business management before being elected a corporate vice president in 1995.

Ann also serves on the boards of Qualcomm Incorporated, Mesosphere, Inc., a private software company, and the Lucile Packard Children’s Hospital at Stanford University. She served on the Board of Directors of Hewlett Packard Company until 2015. Ann is also a lecturer at the Stanford Graduate School of Business.

Reasons for election to the UPS Board

Ann has extensive experience in senior leadership positions at HP, one of the world’s largest information technology companies. This experience includes leading a complex global business organization with a large workforce. Through her 29 years at HP, she has gained knowledge and experience in the areas of technology, marketing, sales, research and development and business management.


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Our Board of Directors

Rudy H.P. MarkhamAngela Hwang

Former Financial Director, UnileverGroup President, Pfizer Biopharmaceuticals Group, Pfizer, Inc.

Career

Angela has been a member of Pfizer, Inc.’s Executive Team since 2018 and currently is Group President of the Pfizer Biopharmaceuticals Group, a position she has held since 2019. In this role, Angela leads Pfizer’s entire commercial business which includes eight commercial business units, reaching patients in more than 125 countries. Angela has been with Pfizer since 1997, working across all geographies and therapeutic areas.

Prior to her current role, during 2018 she served as Group President, Pfizer Essential Health; and from 2016 to 2018 she was Global President Pfizer Inflammation and Immunology. Angela has served in various roles with increasing responsibility, including senior roles in Pfizer Vaccines, Primary Care, and Emerging Markets.

Angela sits on the boards of the European Federation of Pharmaceutical Industries and Associations, and the Pfizer Foundation, a charitable organization that addresses global health challenges.

Reasons for election to the UPS Board

Angela has significant expertise in the healthcare sector and in managing large complex businesses, including supply chain management and logistics. She also has experience in emerging markets gained through her work across many geographies. Angela is also a strong advocate for women’s leadership and sustainable global health equity.

Age: 7356

Director since 2007

2020

Skills and Experience

- Global perspective, international

- Healthcare

- Operations

- Supply chain management

Board Committee

- Audit







-Kate Johnson

Former President, Microsoft U.S., Microsoft Corporation

Career

Kate served as President of Microsoft U.S. a division of Microsoft Corporation, a global technology company, from 2017 until her retirement in 2021. She had responsibility for Microsoft’s U.S. activities, including growing the company’s solutions, services, and support revenues. She focused on driving transformation with Microsoft’s largest sales subsidiary, leading a 9,500 + person field team.

Prior to Microsoft, she held various senior positions with GE, including Executive Vice President and Chief Commercial Officer GE Digital, from 2016 to 2017; Chief Executive Officer GE Intelligent Platforms Software from 2015 to 2016; and Vice President and Chief Commercial Officer, from 2013 to 2015.

Prior to GE, she held various senior leadership roles at Oracle and various roles with increasing responsibilities at Red Hat, UBS Investment Bank and Deloitte Consulting.

Reasons for election to the UPS Board

Kate has significant experience leading businesses within large companies undergoing transformation, large systems companies, and high growth disruptors. She brings a strong commercial orientation, strategic experience and technical acumen.

Age: Finance,54

Director since 2020

Skills and Experience

- Consumer retail

- Digital technology

- Human capital management

- Operations

- Sales and marketing

- Small and medium sized businesses

- Technology and technology strategy

Board Committees

- Nominating and Corporate Governance

- Risk

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William Johnson

UPS Board Chair

Former Chairman, President and Chief Executive Officer, H.J. Heinz Company

Career

Bill currently serves as UPS’s Board Chair, and previously served as Chairman, President and Chief Executive Officer of H.J. Heinz Company, a global packaged foods manufacturer, from 2000 until his retirement in 2013. He became President and Chief Operating Officer of H.J. Heinz in 1996, and assumed the position of President and Chief Executive Officer in 1998.

Bill currently serves on the Board of Directors of Sovos Brands, Inc. He previously served on the Boards of Directors of Emerson Electric Company until 2017 and PepsiCo, Inc. until 2020.

Reasons for election to the UPS Board

Bill has significant senior management experience gained through over 13 years of service as the Chairman and Chief Executive Officer of H.J. Heinz, a corporation with significant international operations and a large, labor intensive workforce. He also has deep experience

in operations, marketing, brand development and logistics. He served as our lead independent director from 2016 to 2020, and he has served as our independent Board Chair since 2020, during which time he has gained significant knowledge and expertise about our board functions, operations, business and strategy.

-Age: Management of large, complex businesses73

Director since 2009

-Business operations in Asia

Board Chair since 2020

- Lead Director 2016 – 2020

Skills and Experience

- CEO experience

- Consumer retail

- Global perspective, international

- Human capital management

- Operations

- Sales and marketing

- Supply chain management

Other Public Company Boards

-AstraZeneca PLC

-Corbion, N.V.
Sovos Brands, Inc.

Board Committee

Committees

-Compensation

-Nominating and Corporate Governance
(Chair)

- Executive

Career

Rudy was the Financial Director of Unilever from 2000 through his retirement in 2007. He joined Unilever in 1968.  From 1989 through 1998 Rudy was based in East Asia where he held a series of increasing responsibilities, ultimately serving as Business Group President North East Asia based in Singapore. Rudy joined the board of Unilever as Strategy and Technology Director, became a member of its Executive Committee in 1998 and was subsequently appointed as Financial Director. In 2007, he retired from the board of Unilever and as Chief Financial Officer.

Rudy also is a director of AstraZeneca PLC and is Vice Chairman of the supervisory board of Corbion, N.V., formerly CSM, N.V. He served on the Boards of Directors of Legal and General PLC until 2017 and Standard Chartered Bank until 2014. Rudy is a British citizen and he currently resides in the U.K.

Reasons for election to the UPS Board

Rudy has significant experience in finance, technology and international operations that he gained through his almost 40 years of service at Unilever, one of the world’s largest consumer goods companies. Rudy also has insight into the operations of an organization with a large, global workforce, and has a unique insight into operations based in Asia. Rudy’s experience also includes service as a director of other Europe-based global public companies.


Franck J. MoisonAnn Livermore

Former Executive Vice Chairman,
Colgate-PalmolivePresident, Hewlett Packard Company

Career

Ann was Executive Vice President of the HP Enterprise Business at Hewlett Packard Company, one of the world’s largest information technology companies, until her retirement in 2011. Ann joined HP in 1982 and held a variety of management positions in marketing, sales, research and development, and business management before being appointed a corporate vice president in 1995.

Ann serves on the Boards of Directors of Hewlett Packard Enterprise Company, Qualcomm Incorporated, and Samsara, Inc. She served on the Board of Directors of Hewlett Packard Company until 2015.

Reasons for election to the UPS Board

Ann has extensive operational experience from her senior leadership positions at HP. This includes leading a complex global business organization with a large workforce. Through her 29 years at HP, she gained knowledge and experience in technology, marketing, sales, research and development and business management.

Age: 6563

Director since 2017

1997

Skills and Experience

-Executing strategic acquisitions

Digital technology

-Emerging markets

Sales and marketing

-International business expertise

Small and medium sized businesses

- Technology and technology strategy

Other Public Company Boards

-Hanes Brands, Hewlett Packard Enterprise Company

- Qualcomm Incorporated

- Samsara, Inc.

Board Committees

-Nominating Compensation and Corporate Governance

Human Capital (Chair)

-Risk

- Executive

Career

Franck was Vice Chairman for the Colgate-Palmolive Company, a global consumer products company, a position he held from 2016 until his retirement in 2018. He led Colgate-Palmolive’s operations in Asia, South Pacific and Latin America, and he also led Global Business Development. Previously, he was Chief Operating Officer of Emerging Markets from 2010 until 2016, and he was given additional responsibility for Business Development in 2013. Beginning in 1978, Franck served in various management positions with the Colgate-Palmolive Company, including President, Global Marketing, Global Supply Chain & R&D from 2007 to 2010, and President, Western Europe, Central Europe and South Pacific from 2005 to 2007.

He serves on the Board of Directors of Hanes Brands, Inc., is a director of the French American Chamber of Commerce, is Chairman of the International Advisory Board of the EDHEC Business School (Paris, London, Singapore) and is a member of the International Board of the McDonough School of Business at Georgetown University.

Reasons for election to the UPS Board

Franck has extensive experience as a senior executive at a large organization engaged in international business. He is a leader in consumer product innovation, strategic marketing, acquisitions, and emerging market business development. He is one of the most accomplished marketing and operating executives in the global consumer products industry. In addition, Franck has experience serving as a director of other publicly traded companies.


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Clark “Sandy” T. Randt, Jr.

Former U.S. Ambassador to the
People’s Republic of China

Age: 73
Director since 2010
Skills and Experience
-Experience facilitating business throughout Asia
-Diplomacy and international trade
-Experience as an advisor on international matters
Other Public Company Boards
-Qualcomm Incorporated
-Valmont Industries, Inc.
-Wynn Resorts, Ltd.
Board Committees
-Compensation
-Nominating and Corporate Governance
Career

Sandy is a former U.S. ambassador to the People’s Republic of China, where he served from 2001 until 2009. From 1994 through 2001, he was a partner resident in the Hong Kong office of Shearman  & Sterling, a major international law firm, where he headed the firm’s China practice. From 1982 through 1984, Sandy served as First Secretary and Commercial Attaché at the U.S. Embassy in Beijing. In 1974, he was the China representative of the National Council for United States-China Trade, and from 1968 to 1972, he served in the U.S. Air Force Security Service. Currently, Sandy is President of Randt & Co. LLC, a company that advises firms with interests in China.

Sandy also serves on the Boards of Directors of Qualcomm Incorporated, Valmont Industries, Inc. and Wynn Resorts, Ltd.

Reasons for election to the UPS Board

Sandy has substantial experience in Asia and in facilitating business throughout Asia. He is recognized as one of America’s foremost authorities on China, and has more than 35 years of direct experience in Asia. He brings to the board experience in diplomacy and international trade. He has experience as an advisor on international matters to large, multinational corporations, and brings the experience of leading the China practice of a major international law firm.


Christiana Smith Shi

Former President of
Direct-to-Consumer, Nike, Inc.

Age: 59
Director since 2018
Skills and Experience
-E-commerce
-Global retail operations
-Supply chain management
Other Public Company Boards
-Mondelez International, Inc.
-Williams-Sonoma, Inc.
Board Committees
-Compensation
-Risk
Career

Christiana is currently the founder and principal at Lovejoy Advisors, LLC, an advisory services firm that assists clients with digitally transforming consumer and retail businesses. She was the President, Direct-to-Consumer, for Nike, Inc., a global apparel company, from 2013 until 2016. From 2012 through 2013, she was Nike’s Vice President and General Manager, Global Digital Commerce. She joined Nike in 2010 as Vice President and Chief Operating Officer, Global Direct-to-Consumer. Prior to joining Nike, Christiana spent 24 years at global management consulting firm McKinsey & Company, the last 10 as a senior partner. She began her career at Merrill Lynch & Company in 1981 and served in various trading, institutional sales and investment banking roles.

Christiana also serves on the Boards of Directors of Mondelēz International, Inc. and Williams-Sonoma, Inc. She served on the Board of Directors of West Marine, Inc. until 2017.

Reasons for election to the UPS Board

Christiana has substantial experience in digital commerce, global retail operations and helping companies with transformative change. She also has strong supply chain and cost management expertise in the global consumer industry. She gained experience advising senior executives at consumer companies across North America, Europe, Latin America and Asia on leadership and strategy. Christiana also has extensive public company board experience.


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Our Board of Directors

John T. StankeyFranck Moison

Former Vice Chairman, Colgate-Palmolive Company

Career

Franck was Vice Chairman for the Colgate-Palmolive Company, a global consumer products company, a position he held from 2016 until his retirement in 2018. He led Colgate-Palmolive’s operations in Asia, South Pacific and Latin America, and he also led Global Business Development. Previously, he was Chief Operating Officer of Emerging Markets from 2010 until 2016, and he was given additional responsibility for Business Development in 2013. Beginning in 1978, Franck served in various management positions with Colgate-Palmolive, including President, Global Marketing, Global Supply Chain & R&D from 2007 to 2010; and President, Western Europe, Central Europe and South Pacific from 2005 to 2007.

He serves on the Boards of Directors of Hanes Brands, Inc. and SES-imagotag in France. He is the Chairman of the International Advisory Board of the EDHEC Business School (Paris, London, Singapore) and is a member of the International Board of the McDonough School of Business at Georgetown University.

Reasons for election to the UPS Board

Franck has extensive experience as a senior executive at a large organization engaged in international business. He is a leader in consumer product innovation, strategic marketing, acquisitions, and emerging market business development. He is a highly accomplished marketing and operating executive in the global consumer products industry. In addition, Franck has experience serving as a director of other publicly traded companies.

Age: 68

Director since 2017

Skills and Experience

- Consumer retail

- Geopolitical risk

- Global perspective, international

- Operations

- Sales and marketing

- Supply chain management

Other Public Company Boards

- Hanes Brands, Inc.

Board Committees

- Nominating and Corporate Governance

- Risk

Christiana Smith Shi

Former President of Direct-to-Consumer, Nike, Inc.

Career

Christiana is the founder and currently principal at Lovejoy Advisors, LLC, an advisory services firm that assists clients with digitally transforming consumer and retail businesses. She was the President, Direct-to-Consumer, for Nike, Inc., a global apparel company, from 2013 until 2016. From 2012 through 2013, she was Nike’s Vice President and General Manager, Global Digital Commerce. She joined Nike in 2010 as Vice President and Chief Operating Officer, Global Direct-to-Consumer. Prior to joining Nike, Christiana spent 24 years at global management consulting firm McKinsey & Company, the last 10 as a senior partner. She began her career at Merrill Lynch & Company in 1981 and served in various trading, institutional sales and investment banking roles.

Christiana also serves on the Board of Directors of Mondelēz International, Inc. She served on the Boards of Directors of West Marine, Inc. until 2017 and Williams-Sonoma, Inc. until 2019.

Reasons for election to the UPS Board

Christiana has substantial experience in digital commerce, global retail operations and helping companies with transformative change. She also has strong supply chain and cost management expertise in the global consumer industry. She gained experience advising senior executives at consumer companies across North America, Europe, Latin America and Asia on leadership and strategy. Christiana also has extensive public company board experience.

Age: 62

Director since 2018

Skills and Experience

- Consumer retail

- Digital technology

- Global perspective, international

- Operations

- Sales and marketing

- Supply chain management

Other Public Company Boards

- Mondelēz International, Inc.

Board Committees

- Compensation and Human Capital

- Risk

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Russell Stokes

President and Chief Executive Officer,
WarnerMedia LLC GE Aviation Services

Career

Russell has served as President and Chief Executive Officer of GE Aviation Services since 2020. Russell leads GE’s Aviation Services commercial growth, operating performance and customer experience across its global Overhaul and Repair footprint. Prior to this role, Russell was president and CEO of GE Power Portfolio from 2019 to 2020, GE Power from 2017 to 2019, GE Energy Connections from 2015 to 2017, and GE Transportation from 2013 to 2015. He has held other senior roles at GE Transportation and GE Aviation. Russell joined GE in 1997 as part of GE’s Financial Management Program.

He is active in several Atlanta community-based organizations and is the former Chairman of the Metro Atlanta Chamber of Commerce.

Reasons for election to the UPS Board

During his more than 24-year career at GE, Russell has gained deep finance and operating experience through navigating multiple industries, business segments, and market cycles. He has extensive experience in transforming businesses by moving complex business issues into focused, targeted actions for improvement. He has experience in developing solutions and technology required to ensure successful implementation of the business strategy.

Age: 5650

Director since 2014

2020

Skills and Experience

- Human capital management

- Operations

- Risk and compliance

- Sales and marketing

- Small and medium sized businesses

- Technology and communications services

-Global business operations
-Experience with large, multi-national unionized workforce
technology strategy

Board Committees

-Audit

Compensation and Human Capital

- Nominating and Corporate Governance

Career

John is currently the Chief Executive Officer of WarnerMedia LLC, a multinational mass media and entertainment company owned by AT&T, and is responsible for AT&T’s media business, which includes HBO, Turner, Warner Bros., and OTTER Media. John previously led the integration planning team in support of the AT&T and Time Warner merger, and prior to that, served as CEO, AT&T Entertainment Group, which provides entertainment and communications experiences for more than 100 million TV, mobile and broadband subscribers. Under John, AT&T’s Entertainment Group has been a leader in creating new mobile video experiences for consumers, including the launch of DIRECTV NOW, a streaming video service; the integration of the company’s video, mobile and broadband operations; and creation of a new, made-for-streaming video technology platform. John was named to that position after leading the company’s acquisition of DIRECTV in 2015, when he was AT&T’s Chief Strategy Officer, responsible for the company’s corporate strategy, M&A, and business development initiatives.

In his three-decade career with AT&T, a multinational communications company, John has held a variety of other senior leadership positions, including: President and CEO – AT&T Business Solutions; President and CEO – AT&T Operations; Group President – Telecom Operations; Chief Technology Officer; and Chief Information Officer.

Reasons for election to the UPS Board

During his more than 30 year career at AT&T, John has gained significant experience in technology and communications services, strategic planning and execution, and global business operations. As a senior leader at one of the world’s largest communications companies, John has extensive experience managing a large, complex, multi-national business with a large, labor intensive workforce, much of which is unionized. He also has experience working with a company that has both direct to consumer and business to business offerings.


Carol B. ToméKevin Warsh

Chief Financial Officer and
Executive Vice President —
Corporate Services,
The Home Depot, Inc.

Age: 62
Director since 2003
Skills and Experience
-Financial expertise
-Strategic business development / e-commerce
-Management of large, complex businesses
Board Committee
-Audit (Chair)
Career

Carol has been Executive Vice President and Chief Financial Officer of The Home Depot,  Inc., one of the world’s largest retailers, since 2001. In 2007 Carol assumed the additional role of Executive Vice President  — Corporate Services. She provides leadership in the areas of real estate, financial services and strategic business development. Her corporate finance duties include financial reporting and operations, financial planning and analysis, internal audit, investor relations, treasury and tax. Prior to her current position, she had been Senior Vice President — Finance and Accounting / Treasurer from 2000 until 2001, and from 1995 until 2000, she served as Vice President and Treasurer.

Carol also has served as a Member of the Advisory Board of certain Fidelity funds since 2017 and previously served as a Trustee of certain Fidelity funds during 2017.

Reasons for election to the UPS Board

Carol has extensive experience in corporate finance gained throughout her career at The Home Depot. She brings the experience of currently serving as Chief Financial Officer of a complex, multi-national business with a large, labor intensive workforce. Carol also has experience with strategic business development, including e-commerce strategy. Carol’s past role as Chair of the Board of the Federal Reserve Bank of Atlanta also brings valuable financial experience.


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Kevin Warsh

Former Member of the Board
of Governors of the Federal
Reserve System, Distinguished
Visiting Fellow, Hoover Institution,
Stanford University

Career

Kevin currently serves as the Shepard Family Distinguished Visiting Fellow in Economics at Stanford University’s Hoover Institution, a public policy think tank, and a Dean’s Visiting Scholar and lecturer at Stanford’s Graduate School of Business. He serves as advisor to Duquesne Family Office.

He was a member of the Board of Governors of the Federal Reserve from 2006 until 2011. From 2002 until 2006, Kevin served at the White House as President George W. Bush’s special assistant for economic policy and as executive secretary of the National Economic Council. Kevin was previously employed by Morgan Stanley & Co., eventually serving as vice president and executive director of the Mergers and Acquisitions department.

He also serves on the Board of Directors of Coupang, Inc.

Reasons for election to the UPS Board

Kevin has extensive experience in understanding and analyzing the economic environment, the financial marketplace and monetary policy. He has a deep understanding of the global economic and business environment. Kevin also brings the experience of working in the private sector for a leading investment bank gained during his tenure at Morgan Stanley & Co.

Age: 4851

Director since 2012

Skills and Experience

-Economic Geopolitical risk

- Global perspective, international

- Government and business environment, domesticallyregulatory

Other Public Company Boards

- Coupang, Inc.

Board Committees

- Compensation and internationally

Human Capital

-Private sector experience

Board Committees
-Compensation
-Nominating and Corporate Governance

Career

Kevin was a member of the Board of Governors of the Federal Reserve from 2006 until 2011. He currently serves as  the Shepard Family Distinguished Visiting Fellow in Economics at Stanford University’s Hoover Institution and a lecturer at its Graduate School of Business. In addition, Kevin provides strategic, consulting and advisory services to a range of businesses. From 2002 until 2006, Kevin served at the White House as President George W. Bush’s special assistant for economic policy and as executive secretary of the National Economic Council.

Kevin was previously employed by Morgan Stanley & Co. in New York, becoming vice president and executive director of the company’s Mergers and Acquisitions Department.

Reasons for election to the UPS Board

Kevin has extensive experience in understanding and analyzing the economic environment, the financial marketplace and monetary policy. He has a deep understanding of the global economic and business environment. Kevin also brings the experience of working in the private sector for a leading investment bank gained during his tenure at Morgan Stanley & Co.


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Our Board of Directors

Committees of the Board of Directors

The board has four committees composed entirely of independent directors:directors as defined by the Audit Committee, the Compensation Committee, the NominatingNYSE and Corporate Governance Committee, and the Risk Committee.by our director independence standards. Information about each of these committees is provided below. The board also has an Executive Committee that may exercise all powers of the Board of Directors in the management of our business and affairs, except for those powers expressly reserved to the board under Delaware law or otherwise limited by the board. David AbneyCarol Tomé is the chair of the Executive Committee. Independent directorsChair, and Ann Livermore and Bill Johnson also serve on the Executive Committee. The Executive Committee did not hold any meetingsheld one meeting during 2018. Each member of the board’s committees, other than the Executive Committee, meets the NYSE director independence requirements.2021.

Audit Committee(1)   Compensation and Human
Capital Committee(2)		   Nominating and Corporate
Governance Committee		   Risk Committee
Carol Tomé,Eva Boratto, Chair
Michael Burns
Candace Kendle(3)Wayne Hewett
John StankeyAngela Hwang		Ann Livermore, Chair
Rodney Adkins
Rudy Markham
Clark Randt, Jr.
Christiana Smith Shi
Russell Stokes
Kevin Warsh		William Johnson, Chair
Rudy MarkhamKate Johnson
Franck Moison
Clark Randt, Jr.Russell Stokes
Kevin Warsh		Rodney Adkins, Chair
Kate Johnson
Ann Livermore
Franck Moison
Christiana Smith Shi
Meetings in 2018:2021: 10Meetings in 2018:2021: 5Meetings in 2018:2021: 4Meetings in 2018:2021: 3
Primary ResponsibilitiesPrimary ResponsibilitiesPrimary ResponsibilitiesPrimary Responsibilities

●Assisting the board in discharging its responsibilityresponsibilities relating to our accounting, reporting and financial practices

●Overseeing our accounting and financial reporting processes

●Overseeing the integrity of our financial statements, our systems of disclosure controls and internal controls and our compliance with legal and regulatory requirements

●Overseeing the performance of our internal audit function

●Overseeing the engagement and performance of our independent accountants

●  Overseeing compliance with legal and regulatory requirements as well as our Code of Business Conduct

●Discussing with management policies with respect to financial risk assessment

●Assisting the board in discharging its responsibilities with respect to compensation of our senior executive officers

●Reviewing and approving the corporate goals and objectives relevant to the compensation of our Chief Executive Officer

●Evaluating the Chief Executive Officer’s performance and establishing compensation based on this evaluation

●Reviewing and approving the compensation of other executive officers

●Overseeing the evaluation of risk associated with the Company’s totalour compensation strategy and compensation programs

●Overseeing any outside consultants retained to advise the Committee

●Recommending to the board the compensation to be paid to non-managementfor non- management directors

●Considering recommendations from the Chief Executive Officer  Overseeing performance and others regardingtalent management, diversity, equity and inclusion, work culture and employee development and retention

●  Addressing succession planning

●Assisting the board in identifying and screening qualified director candidates, including shareowner submitted nominees

candidates

●Recommending candidates for election or reelection, to the board or to fill vacancies, on the board

●Aiding in attracting qualified candidates to serve on the board

●Recommending corporate governance principles, including the structure, composition and functioning of the board and all board committees, the delegation of authority to subcommittees, board oversight of management actions and reporting duties of management

●Overseeing management’s identification and evaluation of enterprise risks

●Overseeing and reviewing with management the Company’sour risk governance framework

●Overseeing the Company’s risk identification, risk tolerance, risk assessment and management practices for strategic enterprise risks facing the Company

●Reviewing approaches to risk assessment and mitigation strategies in coordination with the board and other board committees

●Communicating with the Audit Committee as necessary and appropriate to enable the Audit Committee to perform its statutory, regulatory, and other responsibilities with respect to oversight of risk assessment and risk management


(1)All members of the Audit Committee have been designated by the Board of Directors as audit committee financial experts. Each member of our Audit Committee meets the independence requirements of the NYSE and Securities and Exchange Commission (“SEC”) rules and regulations applicable to Audit Committeeaudit committee members, and each is financially literate.
 
(2)Each member of our Compensation and Human Capital Committee meets the NYSE’s independence requirements applicable to compensation committee members. In addition, each member is a non-employee director as required by Rule 16b-3 under the Securities Exchange Act of 1934. None of the members of the Compensation and Human Capital Committee is or was during 20182021 an employee or former employee of UPS, and none had any direct or indirect material interest in or relationship with UPS outside of his or her position as a non-employee director. The Compensation and Human Capital Committee may delegate its responsibilities to subcommittees of one or more directors as it may deem appropriate. For information regarding the role of our executive officers and the committee’s independent compensation consultant in determining or recommending the amount or form of executive and director compensation (as applicable), please see the Compensation Discussion and Analysis section and the Director Compensation section below in this proxy statement. Compensation Committee Interlocks and Insider Participation:Participation: None of our executive officers serves or served during 20182021 as a member of a board of directors or compensation committee of any entity that has one or more executive officers who serve on our Board of Directors or Compensation and Human Capital Committee.
(3)Candace Kendle’s service on the Board of Directors will conclude at the 2019 Annual Meeting.   29

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2021 Director Compensation

We compensateThe Compensation and Human Capital Committee of the Board of Directors evaluates director compensation with the assistance of its independent compensation consultant, Frederic W. Cook & Co., Inc. (“FW Cook”).

For service in 2021, our non-employee directors with a mixreceived an annual cash retainer of cash$110,000 and equity.an annual restricted stock unit (“RSU”) award valued at $175,000. Equity compensation links director pay to the value of Company stock and aligns the interests of directors more closely with thoselong-term shareowners. Directors are also reimbursed for any board related expenses.

Our independent Board Chair received an additional annual cash retainer of Company shareowners. David Abney$160,000 and an additional annual RSU award valued at $70,000 to reflect the additional responsibilities and time commitment associated with the position. Our CEO does not receive any compensation for service as a director. Directors are also reimbursed for their expenses related to board membership.

Non-Employee Director Compensation*

*Does not include committee chair or lead director fees.

There have been no significant increases in director compensation over the last few years. In 2018, our non-employee directors received an annual cash retainer of $105,000.service. The chairs of the Compensation and Human Capital, Nominating and Corporate Governance and Risk Committees received an additional annual cash retainer of $20,000, and the chairChair of the Audit Committee received an additional annual cash retainer of $25,000. Our lead independent director received an additional annual cash retainer of $25,000.

Cash retainers are paid on a quarterly basis. Non-employee directors may defer retainer fees by participating in the UPS Deferred Compensation Plan, but we do not make any Company or matching contributions underto this plan. There are no preferential or above-market earnings in the UPS Deferred Compensation Plan.

Non-employee directors also receive an annual restricted stock unit (“RSU”) grant valued at approximately $170,000. RSUs are fully vested on the date of grant and are required to be held by the director until he or she separates from the board, at which time the RSUs are paid out inconvert to shares of class A common stock.

Dividends earned on each awardshares underlying director RSUs are deemed reinvested in additional units at each dividend payable date and are subject to the same payment scheduleterms as the original award.grant. This holding period increases the strength of the alignment of directors’ interests with those of our long-term shareowners. The annual equity grant is prorated based on the portion of the year that a director serves on the board.

TheDirector Compensation Committee of the Board of Directors conducts a review of director compensation generally every other year to ensure the program is structured consistent with best practices and current trends. The Compensation Committee’s independent compensation consultant, Frederic W. Cook & Co., Inc. (“FW Cook”), provides advice on the competitiveness of the Company’s non-employee director compensation program and recommends changes to ensure compensation remains market competitive. During the Compensation Committee’s most recent review of director compensation, it was determined that total board compensation was below our peer group median.


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Director Compensation

The following tables set forth the cash compensation paid to our non-employeeindividuals who served as directors in 20182021 (other than our CEO) and the aggregate value of stock awards granted to our non-employee directorsthose persons in 2018,2021, as well as outstanding director equity awards held as of December 31, 2018.2021.

 
2018 Director Compensation
 
Name    Fees
Earned or
Paid in
Cash($)		    Stock
Awards($)(1)		    Total($)
Rodney C. Adkins(2)125,000169,959294,959
Michael J. Burns105,000169,959274,959
William R. Johnson(2)150,000169,959319,959
Candace Kendle(3)105,000169,959274,959
Ann M. Livermore(2)125,000169,959294,959
Rudy H.P. Markham105,000169,959274,959
Franck J. Moison105,000169,959274,959
Clark T. Randt, Jr.105,000169,959274,959
Christiana Smith Shi(4)105,000212,360317,360
John T. Stankey105,000169,959274,959
Carol B. Tomé(2)130,000169,959299,959
Kevin M. Warsh105,000169,959274,959
 
2021 Director Compensation
Name   Fees
 Earned or
Paid in
 Cash($)		   Stock
 Awards($)(1)		   Total($)
Rodney Adkins(2) 130,000 174,908   304,908
Eva Boratto(2) 122,500 174,908 297,408
Michael Burns 110,000 174,908 284,908
Wayne Hewett 110,000 174,908 284,908
Angela Hwang 110,000 174,908 284,908
Kate Johnson 110,000 174,908 284,908
William Johnson(2)(3) 290,000 244,785 534,785
Ann Livermore(2) 130,000 174,908 304,908
Rudy Markham(4) 67,500 — 67,500
Franck Moison 110,000 174,908 284,908
Clark Randt, Jr. 55,000 — 55,000
Christiana Smith Shi 110,000 174,908 284,908
Russell Stokes 110,000 174,908 284,908
Kevin Warsh 110,000 174,908 284,908
Outstanding Director Stock Awards
(as of December 31, 2018)
Stock Awards
Name     
Restricted
Stock
Units (#)		    Phantom
Stock
Units (#)
Rodney C. Adkins10,833—
Michael J. Burns21,365—
William R. Johnson22,386—
Candace Kendle15,381—
Ann M. Livermore21,3652,506
Rudy H.P. Markham21,365—
Franck J. Moison3,628—
Clark T. Randt, Jr.17,613—
Christiana Smith Shi1,927—
John T. Stankey8,248—
Carol B. Tomé21,3651,185
Kevin M. Warsh12,692—
Outstanding Director Stock Awards
 (as of December 31, 2021)
  Stock Awards
Name Restricted
Stock
Units (#)		 Phantom
Stock
Units (#)
Rodney Adkins   16,543   —
Eva Boratto 1,677 —
Michael Burns 28,059 —
Wayne Hewett 1,677 —
Angela Hwang 2,017 —
Kate Johnson 1,373 —
William Johnson 29,757 —
Ann Livermore 28,059 2,740
Rudy Markham(5) — —
Franck Moison 8,664 —
Clark Randt, Jr.(5) — —
Christiana Smith Shi 6,804 —
Russell Stokes 1,373 —
Kevin Warsh 18,576 —
Carol Tomé(6) 25,244 1,295



(1)The values of stock awards in this column represent the grant date fair value of restricted stock unitsRSUs granted in 2018,2021, computed in accordance with Financial Accounting Standards Board Accounting Standards Codification (“FASB ASCASC”) Topic 718. Information about the assumptions used to value these awards can be found in Note 1114 “Stock-Based Compensation” in our 20182021 Annual Report on Form 10-K. Restricted stock unitsRSUs are fully vested on the date of grant and will be paidare settled in shares of class A common stock followingupon the director’s separation from service from UPS. Dividends earned on each award are reinvested in additional units at each dividend payable date and are subject to the same payment schedule as the original award.
(2)Includes compensation for committee chair service and/or lead director service.
(3)Candace Kendle’s service on the Board of Directors will conclude at the 2019 Annual Meeting.
Includes compensation for independent board chair service.
(4)JoinedIncludes compensation for Audit Committee chair service prior to retiring from the board in 2018. Reflects a prorated RSU award made in February 2018 andMay 2021.
(5)All outstanding stock awards were paid out following retirement from the annual director award madeboard in May 2018.2021.
(6)Only includes outstanding stock awards that were granted while serving as an independent director.

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Table of Contents

Executive Compensation

Executive Compensation

Executive Compensation

Compensation Committee Report

The Compensation and Human Capital Committee (as used in this Executive Compensation section, the “Committee”) is responsible for reviewingsetting the principles that guide compensation decision-making, establishing the performance goals under our executive compensation plans and programs, and approving compensation for the executive officers, establishing theofficers. The Committee is also responsible for overseeing performance goalsand talent management, diversity, equity and inclusion, work culture and employee development and retention.

We are focused on which the compensation plans and programs are based and setting the overall compensation principles that guide the Compensation Committee’s decision-making. The Compensation Committee’s over-arching objective is to maintainmaintaining an executive compensation program that supports the long-term interests of our shareowners, including our many employeethe Company’s shareowners. We seek to align the interests of our executives with those of ourall shareowners through a program in whichby linking a significant portion of compensation is performance-basedto Company performance and is significantly linked to shareowner returns. We seekThe Company’s programs are also designed to attract, retain, and motivate executives who make significantsubstantial contributions to the Company’s success and allowperformance by allowing them to share in the successCompany’s success.

Our significant efforts in the past year included developing and implementing an appropriate executive compensation structure and performance goals in the midst of a global pandemic and analyzing and updating the Company.Company’s peer group. The Committee’s compensation framework, with the support of our independent compensation consultant, enabled us to successfully navigate these challenges consistent with our compensation principles. Also, during 2021, the board delegated responsibility for human capital oversight to the Committee.

The Compensation Committee hasWe have reviewed the Compensation Discussion and Analysis and discussed it with management. Based on thatour review the Compensation Committeeand discussions, we recommended

to the Board of Directors that the Compensation Discussion and Analysis be included in the 20192022 Proxy Statement and incorporated by reference in the Annual Report on Form 10-K for the year ended December 31, 20182021 filed with the Securities and Exchange Commission.

The following Compensation Discussion and Analysis describes the Compensation Committee’s decisionsprinciples, strategy and programs regarding our executives’ compensation for 2018.2021 executive compensation.

The Compensation & Human Capital Committee

Ann M. Livermore, Chair
Rodney C. Adkins
Rudy H.P. Markham
Clark T. Randt, Jr.
Christiana Smith Shi
Russell Stokes
Kevin M. Warsh


Compensation Discussion and Analysis

UPS’s executive compensation principles, strategy and programs for 2018,2021, and certain aspects of the 20192022 programs, are described below. This section explains how and why the Committee made its 20182021 compensation decisions for our executive officers, withincluding additional detail with respect to the following Named Executive Officers (“NEOs”):

Named Executive OfficersOfficerTitlesTitle
David P. AbneyCarol ToméChief Executive Officer
Richard N. PeretzBrian NewmanChief Financial Officer
James J. Barber, Jr.Scott PricePresident, UPS International
Nando CesaronePresident, U.S. Operations
Kate GutmannChief OperatingSales and Solutions Officer
Scott A. PriceChief Strategy and Transformation Officer
Kevin M. WarrenChief Marketing Officer

Executive Compensation Strategy

As discussed further below, on March 1, 2022, UPS announced that Scott Price is retiring from the Company on March 31, 2022. Kate Gutmann will move into a newly created role of President International, Healthcare and Supply Chain Solutions.

Executive Compensation Strategy

UPS’s executive compensation programs are designed to:

●

Drivedrive organizational performance by tying a significant portion of pay to Company performance;

●

Attract,attract, retain and motivate talent by competitively and fairly compensating our executive officers; and

●

Encourageencourage long-term stock ownership and careers with UPS, aligningUPS; and

●align the interests of our executives to long-term value creation for our Company.

creation.


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Target Compensation

A substantial majority of NEO total target direct compensation (base salary and annual incentives, annual ownership incentives and long-term incentives) that can be earned by the Named Executive Officersincentives, excluding any one-time special awards) is “at risk” and only earned by meetingsubject to the achievement of annual or long-term performance goals.goals and/or continued employment with UPS. The 2018charts below highlight the elements of our CEO and an average of other NEOs’ target direct compensation elementsfor 2021.

Roles and Responsibilities

The Committee is responsible for setting the principles that guide compensation decision-making, establishing performance goals under our executive compensation plans and programs, and approving compensation for the CEO and for the NEOs as a group are displayed in the charts below.

2018 Target Compensation for CEO2018 Target Compensation for all other NEOs

Roles and Responsibilities

executive officers. The UPS executive compensation program is administered by the Compensation Committee of the Board of Directors. The Compensation Committee has sole authority tomay engage and terminate the services of outside advisors and other consultants to assist in carrying out its responsibilities.consultants. In 2018,2021, the Compensation Committee retained FW Cook to act as the

Compensation Committee’sits independent compensation advisor. FW Cook reportsreported directly to the Chair of the Compensation Committee and providesprovided no additional services to UPS.

The following table summarizes the roles of the key participantsroles in the executive compensation decision-making process.


Participant and Roles

CompensationThe Committee

●  develops principles underpinning executive compensation

Reviews and approves●  sets performance goals upon which incentive payouts are based

●  evaluates the corporate goals and objectives relevant toCEO’s performance

●  reviews the Chief Executive Officer’s compensation

●Evaluates the Chief Executive Officer’s performance in light of the goals and objectives
●Reviews the Chief Executive Officer’sCEO’s performance assessment of other executive officers

●Reviews  reviews and approves incentive and other compensation forof the executive officers

●Reviews and approves awards to the executive officers under certain incentive compensation and equity-based plans

●Reviews  reviews and approves the design of other benefit plans for executive officers

●Oversees  oversees the risk evaluation of risk associated with the Company’s totalour compensation strategy and compensation programs

●Considers  considers whether to engage any compensation consultant, and determinesevaluates their independence and whether their work raises any conflict of interest

●Reviews  reviews and discusses with management the Compensation Discussion and Analysis

●Recommends  recommends to the board whetherthe inclusion of the Compensation Discussion and Analysis should be included in the Proxy Statement

●Approves  approves the Compensationinclusion of the Committee’s report on executive compensation

in the Proxy Statement

Independent Members of the Board of Directors

●Assesses  review the performance of the Chief Executive Officer

●Reviews the Compensation Committee’s assessment of the Chief Executive Officer’sCEO’s performance

●  complete a separate evaluation of the CEO’s performance

Determines whether●  approve the Compensation Discussion and Analysis should be includedfor inclusion in the Proxy Statement

Independent Compensation Consultant

●Serves  serves as a resource for market data on pay practices and trends

●Provides  provides independent advice to the Compensation Committee

●Provides  provides competitive analysis and advice related to outside director compensation

●Reviews  reviews the Compensation Discussion and Analysis

●Conducts  conducts an annual risk reviewassessment of the Company’s compensation programs


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Executive Compensation

Participant and Roles

Executive Officers

●The Chief Executive Officer  the CEO makes compensation recommendations to the Compensation Committee for the other executive officers with respect to base salary, annual and long-term incentive targets, and individual performance adjustments to the annual incentive plan payouts

●The Chief Executive Officer  the CEO and the Chief Financial Officer make recommendations onCFO recommend performance goals under our incentive compensation plans and provide an assessment as to whether performance goals were achieved

●The Chief Executive Officer has also been delegated limited authority to make equity awards to employees who are not executive officers


Independence of Compensation Consultant

Compensation Consultant Independence

In November 2018,2021, the Compensation Committee requested and received information regardingreviewed FW Cook’s independence and the existence of any potential conflicts of interest. After evaluating the followingThe Committee evaluated all relevant factors, the Compensation Committee concluded that FW Cook is independent and that the engagement of FW Cook did not raise any conflict of interest:including: (1) other services provided to UPS by the consultantFW Cook (if any); (2) fees paid by UPS as a percentage of the consulting firm’sFW Cook’s total revenue; (3) policies or

procedures maintained by the consulting firmFW Cook that are designed to prevent a conflict of interest; (4) any business or personal relationships between the individual consultants involved in the engagement and a member of the Compensation Committee; (5) any companyCompany stock owned by the individual consultants involved in the engagement; and (6) any business or personal relationships between UPS executive officers and the consulting firmFW Cook or the individual consultants involved in the engagement.


Market Data Utilization

After evaluating these factors, the Committee concluded that FW Cook was independent, and that the engagement of FW Cook did not raise any conflict of interest.

Peer Group and Peer Group Companies


Market data is just one of a variety of factors considered byData Utilization

In determining compensation targets and payouts, the Compensation Committee when determining base salary, annual and long-term equity award opportunities, and total compensation levels. However, compensation is not targeted at a particular percentile. General compensation survey data provides the Compensation Committee with information about UPS compensation levels relative to comparable sized companies.


In addition, the Compensation Committee evaluates, among other things, pay practices and compensation levels forat a peer group of companies. In determining

With assistance from its independent compensation consultant, the Committee evaluates the peer group annually to determine if the Compensation Committee

considers advice from their independent compensation consultant and reviews the appropriateness of the peer group on an annual basis. The companies included in the group are the most appropriate comparators for measuring the success of our executives in delivering shareowner value. In 2021, in consideration of the Company’s transformation efforts and evolving business strategy, the Committee directed FW Cook to undertake a comprehensive evaluation of the peer group. After a detailed analysis, including meetings with each Committee member, FW Cook recommended revising the peer group typically have global operations, a diversifiedselection criteria to better align with the Company’s business strategy and annual salesfocus. Quantitative considerations consisted of historical revenue growth, operating income growth, free cash flow growth, and total shareholder return. Other more general considerations included market capitalizations comparable to UPS. Other considerations includecapitalization, percentage of foreign sales, capital intensity, operating margins, and size of employee populationpopulation.

Following this evaluation, AT&T, Inc., Cisco Systems, Inc., Comcast Corporation, Deere & Company, Intel Corporation and whether the company also includes UPS in their peer group. The peer group considered by the Compensation Committee for 2018 compensation purposes (the “2018 Peer Group”) is unchanged fromWalmart, Inc. were added to the peer group, used for 2017and The Coca-Cola Company, Costco Wholesale Corporation, Delta Airlines, Inc., Sysco Corporation, Raytheon Technologies Corporation, and Walgreens Boots Alliance, Inc. were removed. The updated compensation andpeer group consisted of the companies below.



following:

AT&T, Inc.FedEx CorporationMcDonald’s Corp.
The Boeing CompanyJohnson & JohnsonThe Home Depot, Inc.PepsiCo, Inc
Caterpillar Inc.Intel CorporationThe Procter & Gamble Company
CaterpillarCisco Systems, Inc.The Kroger Co.*Johnson & JohnsonSysco CorporationTarget Corp.
The Coca-Cola CompanyComcast CorporationLockheed Martin CorporationTarget Corp.Walmart, Inc.
Costco Wholesale CorporationDeere & CompanyLowe’s Companies, Inc.United Technologies Corporation
FedEx CorporationMcDonald’s Corp.Walgreen Boots Alliance, Inc.
The Home Depot, Inc.PepsiCo, Inc.

*For 2019 compensation purposes,

In addition to peer group analyses, the Committee considers other market data, including general compensation survey data from comparably sized companies. For 2021, the Committee utilized the prior peer group and 2021 compensation was not targeted to a particular percentile within that peer group or otherwise.

Internal Compensation Comparisons

The Kroger Co. was removed and Delta Airlines, Inc. was added to better align the peer group to the selection criteria described above.


Internal Compensation Comparisons

The Compensation Committee also generally considers the compensation differentials between executive officer compensationofficers and the compensation paid for other UPS positions, and generally considers the additional responsibilities of the Chief Executive OfficerCEO compared to other
executive officers. Internal comparisons are made tohelp ensure that compensation paid to executive officersofficer compensation is reasonable when compared to theirthat of direct reports.


Annual Performance Reviews
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Each year, the Chief Executive Officer

Table of Contents

Annual Performance Reviews

The CEO assesses the performance of all other executive officers (other than the CEO)each year and provides feedback to the Compensation Committee. In addition, the Compensation Committee evaluates the Chief Executive Officer’sCEO’s performance on an annual basis. The Compensation Committee chairChair discusses the results of thethis evaluation with the full board

(other (other than the CEO) in an executive session. During theAs part of this evaluation, the board considers the Chief Executive Officer’sCEO’s strategic vision and leadership, execution of UPS’s business strategy, and achievement of business goals. Other factors include the Chief Executive Officer’sCEO’s ability to make long-term decisions that create a competitive advantage, and overall effectiveness as a leader.


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CentralKey Elements of
UPS Executive Compensation


Other Elements of Compensation(1)

Benefits PerquisitesOther Elements of Compensation 
BenefitsPerquisitesRetirement Programs
✓

 NEOs generally participate in the same plans as other employees.

✓

 Includes medical, dental, and disability plans that mitigate the financial impact of illness, disability or death.

✓

 See further details on page 40.

✓

 Limited in nature andnature; benefits outweigh the benefits from providing perquisites outweigh costs.

✓

 Includes financial planning and executive health services that facilitate the NEOs’ ability to carry out responsibilities, maximize working time and minimize distractions.

✓

 Considered necessary or appropriate to attract and retain executive talent.

✓

 See further details on page 40.

✓

 NEOs and most non-union U.S. employees participate in the same qualified plans with the same formulas.

✓

 Includes qualified and nonqualified pension, retirement savings and deferred compensation plans.

✓

 See further details on page 40.

49.

(1)Excludes a special equity award granted to an NEO as recognition of extraordinary contributions and performance during 2020.

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Executive Compensation

Base salary is intended toSalary

Base salaries provide our NEOs with a fixed level of cash compensation.compensation and are designed to provide an appropriate level of financial certainty. The Compensation Committee considers a number ofseveral factors in determining theNEOs’ annual base salaries, of the Named Executive Officers. Base salaries are typically set in Marchincluding Company and become effective in April. While Companyindividual performance, is the most important factor, scope of responsibility, leadership, market data and internal compensation comparisons arecomparisons.

Taking all considered. No single factor is weighted more heavily than another.

Inof those factors into account, in March 2018,2021, the Compensation Committee approved a 3.0%9.2% base salary increase for David Abney, the CEO. The 2018 salaryour CEO and increases of between 2.5% and 12% for the other Named Executive Officers were generally aligned with the salary increase budget for other salaried employees.


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Table of Contents

Annual Incentive Awards

MIP PerformanceManagement Incentive Award —Program - Annual Awards Overview

The MIP PerformanceManagement Incentive award is designed to alignProgram (“MIP”) motivates management and aligns pay with annual Company performanceperformance. This is accomplished by linking payouts to the achievement of pre-established financialmetrics, individual performance and non-financial metrics. Targetstock ownership.

Annual MIP Performance Incentive awards for each NEOperformance incentive award opportunities are based onprovided as a percentage of base salary (165% of base salary for the CEO and 130% of base salary for all other NEOs) subject to a $5 million maximum. Awardssalary. Incentive award payouts are determined by the Compensation Committee, taking into consideration the following:consideration:

●Theactual performance compared to MIP performance metrics (as summarizedtargets (described below);
●Thethe MIP factor (payoutpayout as a percent of target) appliedtarget to the non-executive officer MIP participants;
●Individual performance;
●Overall Companyindividual performance; and
●Businessthe overall business environment and economic trends.

A specific weight is not assigned to any of the factors considered by the Compensation Committee when determining earned awards. MIP Performance Incentive awards for executive officers are considered performance-based compensation fully at risk based on Company performance.

The earned award, if any, is provided two-thirds in restricted performance units (“RPUs”) and one-third in cash. The number of RPUs granted is determined by calculating the dollar value of the portion of the MIP award allocated to equity and dividing by the applicable closing price of our class B common stock on the NYSE on the date of the award. Note however, that a newly hired eligible employee’s first MIP award will be paid entirely in the Company’s fully-vested class A shares.

Commencing with MIP Performance Incentive awards for 2018, the Compensation Committee has determined to provide the equity payout in RPUs that settle in class A shares and vest on the first anniversary of the grant. The Compensation Committee approved these terms in order to more closely align annual compensation with annual performance under the MIP, and to improve the market competitiveness of UPS incentive pay design.

When dividends are paid on UPS common stock, an equivalent value is credited to the participant’s bookkeeping account in additional RPUs. The additional RPUs are subject to the same vesting schedule as the original MIP RPUs.
2018 MIP Performance Incentive Awards

The 2018 target opportunity for each NEO was:

2018 MIP Performance
Incentive Award		    MIP Target
(% Base Salary)		    Target($)
David P. Abney                 165%2,052,686
Richard N. Peretz130%722,857
James J. Barber, Jr.130%936,000
Scott A. Price130%803,400
Kevin M. Warren130%455,000(1) 

(1)

Prorated based on his June 2018 hire date.

The performance metrics used for the NEOs’ MIP Performance Incentive awards in 2018 were:

●Consolidated Revenue Growth, which is measured by year-over-year growth in revenue generated from all products and services worldwide. Revenue growth is important to generating current profits and maintaining the long-term competitive positioning and viability of our Company.
●Adjusted Consolidated Earnings Per Share Growth, which is measured by year-over-year growth in total profits on an after tax, per share basis, after excluding the impact of certain items deemed unrelated to normal operations. Growth in adjusted EPS is directly impacted by our effectiveness in achieving our targets in other key performance elements, including volume growth, growth in consolidated revenue and positive operating leverage.
●Consolidated Average Daily Package Volume Growth, which is measured by year-over-year growth in consolidated package volume divided by the number of operating weekdays during the year.

The 2018 MIP evaluation metrics targets and results were as follows:

2018 MIP Evaluation MetricsTargetActual
Consolidated Revenue Growth   6.0%   7.9%
Adjusted Consolidated Earnings Per Share Growth(1)   20.0%    20.7%
Consolidated Average Daily Package Volume Growth4.0%3.2%

(1)

Excludes the effect of unusual or infrequently occurring items, charges for restructurings (employee severance liabilities, asset impairment costs, and exit costs), discontinued operations, extraordinary items and the cumulative effect of changes in accounting treatment.

The 2018 MIP factor for non-executive MIP participants was:

110%


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The Compensation Committee maintains discretion to adjust awards earned under the MIP up (but not beyond the maximum amount for each NEO) or down based on its assessment of each NEO’s individual performance. The Compensation Committee takes into consideration the recommendations of our CEO with respect to the NEOs, other than himself. The Compensation Committee also considers the results of the board’s annual evaluation of the CEO, which includes ratings on areas such as:

●Leadership qualities;
●Strategic planning and execution;
●Managing for financial results;
●Retaining and developing a diverse top management group;
●Providing equal opportunity employment, and understanding and addressing issues facing employees;
●Ensuring the Company is contributing to the well-being of the communities in which it operates;
●Promoting compliance and ethical behavior; and
●Board relations.

Individual accomplishments during 2018 that were considered by the Committee when determining final awards are described below.

David Abney, Chief Executive Officer

David and the leadership team overcame a number of challenges in 2018. Successful negotiations of a labor agreement with the Teamsters Union as well as managing an organizational transformation and driving a successful peak season. David’s focus on high-quality revenue initiatives as well as growth manifested positive returns to shareowners. Effectively managing capital investments, driving transformation objectives, and execution of investments and initiatives elevated revenues and improved operational efficiencies that provide the company sustainable returns well into the future.

Richard Peretz, Chief Financial Officer

Chief Financial Officer, Richard Peretz’s efforts in 2018 helped guide UPS to achieve target earnings per share as well as generate excellent cash flow to stimulate reinvestment into our global network and provide positive returns to shareowners. Richard, along with our Chief Procurement Officer led Transformation efforts to realign our Procurement function to achieve significant savings.

James Barber, Chief Operating Officer

Jim assumed additional responsibilities in 2018 as the Chief Operating Officer. In this new role, Jim was instrumental in guiding the business units to achieve increased operational capacity, service and productivity. The US Small package business unit processed record volume with exceptional on-time service during the peak holiday season. International achieved record results, with the Supply Chain and Freight segments remaining strong.

Scott Price, Chief Strategy and Transformation Officer

Scott joined the UPS Management Committee in December 2017 to lead the organizational Transformation efforts. Scott is driving a multi-year process of value capture to deliver improvements to our business. Scott successfully executed the first round of transformation initiatives generating savings and drove the alignment of capital investments initiatives.
Kevin Warren, Chief Marketing Officer

Chief Marketing Officer, Kevin Warren joined the UPS Management Committee in June of 2018. Through Kevin’s leadership, a focused go to market strategy has been established around the organizational strategic imperatives with a particular emphasis on small and medium-sized businesses. Kevin and the Marketing team have launched work streams to drive performance through strategic pricing and churn reduction, as well as continuing to build digital marketing capabilities.

After assessing the above-described considerations, the Compensation Committee approved the following 2018 MIP Performance Incentive awards for each NEO. The award is paid two-thirds in restricted performance units (“RPUs”), which vest one year after the award is approved, and one-third in cash, which is paid when the award is approved, except with respect to new-hires, who received the entire award in the form of fully-vested class A shares.

2018 MIP Performance Incentive AwardTarget($)Actual($)
David P. Abney    2,052,686    2,709,545
Richard N. Peretz722,857795,143
James J. Barber, Jr.936,0001,287,000
Scott A. Price803,4001,016,301
Kevin M. Warren(1)455,000550,550

(1)Kevin’s 2018 MIP Performance Incentive Award is prorated based on his June 2018 hire date.

MIP Ownership Incentive Award

Weaddition, we encourage employees to maintain a substantial ownership of the Company’sinterest in UPS stock through equity compensation programs, including our MIP Ownership Incentiveownership incentive award. All MIP participants are eligible for an additionalownership incentive award up to the equivalent of one month’s salary by maintaining significant ownership of UPS equity securities. The amount of the award is equal to the value of the participant’s equity ownership as of December 31 of each year, multiplied by an ownership incentive award percentage. The ownership incentive award percentage is 1.25% for the Chief Executive Officer and 1.50% for the other Named Executive Officers, and theset out below, up to a maximum award that can be earned isof one month’s salary. The MIP Ownership Incentiveownership incentive award, to the extent earned, is paid in the same proportion of equitycash and cashequity as the MIP Performance Incentiveperformance incentive award.

Ownership levels for the 2018 awards wereare determined as of December 31, 2018 by totaling the number of UPS shares in the participant’s family group accounts and the participant’s eligible unvested restricted units and deferred compensation shares. The number of UPS shares determined for purposes of an NEO’s ownership level is multiplied by the closing price of a class B share on the NYSE on December 31, 2018.the last trading day of the year.

2018 MIP Ownership
Incentive Award		Award
Percentage		Maximum
Ownership
Incentive($)		2018 MIP
Ownership
Incentive
Award($)
David P. Abney             1.25%    103,671    103,671
Richard N. Peretz1.50%46,33746,337
James J. Barber, Jr.1.50%60,00060,000
Scott A. Price1.50%51,50043,990
Kevin M. Warren1.50%50,00036,977


MIP awards are considered fully at risk based on Company performance and subject to a $5 million maximum for each NEO. Following the Committee’s approval, the portion of the earned award is paid two-thirds in restricted performance units (“RPUs”) and one-third in cash. The number of RPUs granted is determined by dividing the dollar value of the portion of the MIP award paid in RPUs by the closing price of our class B common stock on the NYSE on the grant date.

When dividends are paid on UPS common stock, an equivalent value is credited to the participant’s bookkeeping account in additional RPUs. RPUs generally vest on the first anniversary of the grant date, furthering the retention component of the award, and are settled in shares of class A common stock.

To further our stock ownership philosophy, initial MIP awards earned by newly hired employees are paid entirely in vested class A shares, with no cash component.

2021 MIP Performance Incentive Awards

In February 2021, the Committee adopted financial performance metrics for the NEOs’ MIP performance incentive awards as follows:

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Adjusted Consolidated Revenue Growth, which is measured as year-over-year growth in revenue from all products and services worldwide. Revenue growth is calculated on a constant currency basis and is important to generating profits and maintaining our long-term competitive positioning and viability.
●Adjusted Consolidated Operating Profit Growth, which is measured as year-over-year growth in operating profits on a constant currency basis. For purposes of measuring this growth, operating profit was determined by reference to our publicly reported adjusted operating profit for each of 2020 and 2021. This growth is directly impacted by our effectiveness in achieving our targets in other key performance elements, including volume and revenue growth and operating leverage.
●Return on Invested Capital, which is calculated as the trailing twelve months of adjusted operating income divided by the average of current assets, current liabilities, goodwill, intangible assets, net property, plant and equipment, other assets, and right-of-use-assets-operating lease. We consider ROIC to be a useful measure for evaluating the effectiveness and efficiency of our long-term capital investments. ROIC is calculated by reference to our publicly reported adjusted operating profit.

After monitoring and considering the economic impact and continued uncertainty caused by the coronavirus pandemic, including the challenges around longer-term forecasting, the Committee determined it was appropriate to bifurcate the performance period for the 2021 MIP award into two six-month performance periods, with each performance period accounting for 50% of the overall

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2021 MIP award. The Committee discussed with management and its independent compensation consultant expected financial performance, risks related to the potential severity and duration of the coronavirus pandemic, and the other matters described above. The performance goals for the first period were set in February 2021 and the performance goals for the second performance period were set in August 2021. The financial performance goals approved by the Committee and the performance results were as follows:

2021 MIP Financial Performance
Metrics(1)		First
 Half
 2021
 Goal		 First
 Half
 2021
 Actual		 Second
 Half
 2021
 Goal		 Second
 Half
 2021
 Actual
Adjusted Consolidated Revenue Growth7.4%20.1%5.4%10.8%
Adjusted Consolidated Operating Profit Growth22.1%79.9%10.1%31.8%
Return on Invested Capital23.2%27.4%28.0%29.8%
(1)Non-GAAP financial measures. See footnote on page 38.

The Committee maintains discretion to adjust awards earned under the MIP up (but not above the maximum amount for each NEO) or down based on its qualitative assessment of each NEO’s individual performance. With respect to the CEO’s MIP award, the Committee considers the results of the board’s annual evaluation of the CEO, which includes ratings on:

Long-Term Incentive Awards●leadership qualities;
●strategic planning and execution;
●managing for financial results;
●retaining and developing a diverse top management group;
●providing equal opportunity employment, and understanding and addressing issues facing employees;
●ensuring the Company contributes to the well-being of the communities in which it operates;
●promoting compliance and ethical behavior; and
●board relations.

For NEOs other than the CEO, the Committee takes into consideration the recommendations of the CEO. Individual accomplishments during 2021 that were considered by the Committee when determining final awards are described below.

Carol Tomé

Carol continued the tremendous momentum of the previous year, leading the team to deliver the highest revenue and profit in the Company’s history for the second straight year. In keeping with the “better, not bigger” theme, Carol executed the strategy to improve revenue quality and productivity, and realigned the portfolio by successfully directing the divestiture of UPS Freight and the acquisition of Roadie, Inc. Carol’s tenacity to improve the customer experience accelerated significant upgrades to digital platforms, which simplified shipping solutions and resulted in new growth. Carol commissioned the development of a new ESG strategy, demonstrating renewed commitment to inclusion by setting DEI goals and establishing the goal to be carbon neutral by 2050. During a difficult business climate, the execution of Carol’s strategy led to expanded margins, record financial results, and total shareowner value growth of approximately thirty percent in 2021.

Brian Newman

In 2021, Brian maintained a relentless focus on revenue management and led a disciplined capital allocation approach which resulted in record revenue and profitability across all three business segments. Brian successfully oversaw the UPS Freight divestiture and was instrumental in navigating the Roadie, Inc. acquisition. Ending the year with more than $10.0 billion in cash, Brian’s actions also secured a solid investment grade credit rating. Brian’s leadership significantly contributed to the growth of total shareowner value by approximately thirty percent in 2021.

Scott Price

Despite an uncertain global economy linked to the lingering pandemic, Scott’s actions secured record profits, margin and return on invested capital. Scott reset the International growth strategy and instilled a customer first mindset, spearheading a customer experience improvement plan. He led the team to achieve total and premium committed service goals, deliver an improved brokerage experience and enhance the claims process. Under Scott’s leadership, U.S. exports were accelerated, productivity targets were achieved, and a new partnership was formed with a joint venture, setting the stage for future global growth.

Nando Cesarone

Nando’s actions resulted in outstanding results in 2021, delivering industry-leading service levels to customers while facilitating a smooth peak season despite numerous obstacles. As the pandemic continued to impact the global supply chain, he led the team with agility by adjusting network operating plans to align capacity with demand. Nando re-imagined U.S. Operations by restructuring the organization and prioritizing training investments, which resulted in significant service and productivity improvements. In collaboration with his partners, Nando drove positive operating leverage by growing revenue in profitable segments while reducing expense. Nando was instrumental in helping deliver the highest revenue and profits in our Company’s history.

Kate Gutmann

In 2021, Kate implemented the customer contract renewal strategy with laser focus on revenue management, while maintaining positive customer relationships. Under her leadership, the small and medium-sized business segment yielded double digit growth. Kate deftly coordinated activities between customers and operations to manage network capacity throughout peak season. Kate aggressively leaned into sales transformation. She led impactful healthcare business growth and profitability, better positioning UPS as an industry partner of choice. Kate was instrumental in UPS achieving historic results in growth and profitability.

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Executive Compensation

2021 MIP Payout

After assessing the above-described considerations, the Committee approved the following MIP award payouts for each NEO.

Name     Incentive
Target (%
Base Salary)		     Incentive
Target
Value ($)		     Actual
Incentive
Value ($)		     Ownership
Award
Percentage (%
of ownership)		     Maximum
Ownership
Award
Value ($)		     Actual
Ownership
Award
Value ($)		     Total 2021
MIP Award
Payout ($)
Carol Tomé 200% 2,730,000 4,095,000 1.25% 113,750 96,416 4,191,416
Brian Newman 130% 995,062 1,492,592 1.50% 63,786 63,786 1,556,378
Scott Price 130% 894,941 1,342,411 1.50% 57,368 38,046 1,380,457
Nando Cesarone 130% 912,818 1,369,228 1.50% 58,514 58,514 1,427,742
Kate Gutmann 130% 981,224 1,471,837 1.50% 62,899 62,899 1,534,736

Long-Term Incentive Awards

Our two long-term incentive programs, the Long-Term Incentive Performance (“LTIP”) award program and the Stock Option program, provide participants with grants of equity-based incentives that are intended to reward performance over a multi-year period and serve as a retention mechanism. The overlappingOverlapping LTIP performance cycles under the LTIP program incentivize sustained

financial performance, while theperformance. The Stock Option program rewards stock price appreciation, which has a direct linkis directly linked to shareowner returns. All 2018 award grants were made under the 2018 Omnibus Incentive Compensation Plan. Target amounts are set as a percentA summary of annualized base salary.


these two programs follows:

ProgramPerformance Measures and/or Value
Proposition for 2021 Awards(1)		Payment Form and
Program Type		Target Amount as Percent of
Annualized Base Salary		Performance
Measures and/or
Value Proposition		Program Objectives
LTIP

Adjusted Earnings Per Share Growth

Adjusted Free Cash Flow

Relative Total Shareowner Return as a modifier

Value increases or decreases with stock price

 

If earned, Restricted Performance Units (RPUs)RPUs are settled in stock

If earned, award vests afterRPUs generally vest at the end of the third fiscal yearthree-year performance period

700% — Chief Executive Officer
575% — Chief Operating Officer
450% — Chief Financial Officer, Chief Strategy and Transformation Officer
350% — other executive officers

Adjusted Growth in Consolidated Revenue

Adjusted Operating Return on Invested Capital

Relative Total Shareowner Return

Value increases or decreases with stock price		 

Supports the Company’s long-term operating plan and business strategy

Provides significant

Significant link to shareowner interests

Stock OptionsOptionValue recognized only if stock price appreciatesStock options generally vest 20% per year over five years and have a ten-year term90% — Chief Executive Officer
50% — Chief Operating Officer, Chief Financial Officer, Chief Strategy and Transformation Officer
30% — other executive officers		Value recognized only if stock price appreciates

Provides a significantSignificant link to shareowner interests

Enhances

Enhance stock ownership and shareowner alignment

LTIP Program and 2018

(1) As described below, prior to 2020, the LTIP performance measures were growth in adjusted consolidated revenue, adjusted return on invested capital and relative total shareowner return. Each performance measure was equally weighted and accounted for one-third of the award payout.

Total Long-Term Equity Incentive Award Target Values

LTIP target values are determined based on internal pay comparison considerations and market data regarding total compensation for comparable positions at similarly situated companies. After considering these factors, in 2021 the Committee increased Carol’s LTIP target RPU value from 735% of base salary. Differences in the target award values are based on varying levels of responsibility among the NEOs. The LTIP target opportunity and Stock Option Award value granted to eligible NEOs in 2021, expressed as a percentage of annualized base salary, is shown below.

Name     LTIP Target
RPU Value
(% Base Salary)		     Option
Value
(% Base
Salary)		     Total
Value
(% Base
Salary)
Carol Tomé 760 90 850
Brian Newman 550 50 600
Scott Price 450 50 500
Nando Cesarone 450 50 500
Kate Gutmann 350 30 380
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LTIP Program

The LTIP program is designed to strengthenstrengthens the performanceperformance-based component of our executive compensation, package, enhancepromotes longer-term focus, enhances retention of key talent, and alignaligns the interests of shareowners with the incentive compensation opportunity for executives. Approximately 500 members of our senior management team, including the Named Executive Officers,NEOs, participate in this program. The program improvescombines internal and external relative business performance measures with the goal of motivating and rewarding management for operational and financial success, while helping to ensure rewards are aligned with shareowner alignmentinterests and further enhances the long-term focus of the award by establishing three-year performance goals.

returns.

AParticipants receive a target award of RPUs is granted to participants at the beginning of the three-year performance period. The number of RPUs that NEOs can earn is shown in the “Grants of Plan-Based Awards” table. The actual number of RPUs that participants receive isNEOs earn will be determined afterfollowing the endcompletion of the three-year performance period and is based on actualachievement of the performance versusmeasures described in more detail below.

Dividends payable on the established performance goals.

A participant’s RPU account is adjusted quarterly for dividends paid on class A common stock. Dividend adjustmentsnumber of shares underlying participants’ RPUs are only made on earned RPUs.allocated in the form of dividend equivalent units (“DEUs”). DEUs are subject to the same conditions as the underlying award. Awards that vest are distributed in shares of class A common stock. Special vesting rules apply to terminations by reason of death, disability or retirement during the performance period, as discussed in greater detail under “Potential Payments Upon Termination or Change in Control.”

The performance measures selected by the Compensation Committee for the 20182021 LTIP awards are:


●Growth in Adjusted Consolidated Revenue;
●Adjusted Operating Return on Invested Capital (“ROIC”); and
●Relative Total Shareowner Return (“TSR”).

were adjusted earnings per share growth and adjusted free cash flow. Each goal is measuredmeasure will be evaluated independently and applied equally in determining final payouts.


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Adjusted consolidated revenue and adjusted ROIC are non-GAAP financial measures. We believe that these non-GAAP measures are appropriate The final payout percentage for the determinationaward will be subject to modification based on the Company’s total shareholder return (“RTSR”) as a percentile rank relative to the total return on the stocks of our incentive compensationthe companies listed on the Standard & Poor’s 500 Composite Index (the “Index”). The maximum LTIP award results because they exclude items that may notcan be indicativeearned is 220% of or are unrelated to, our underlying operations and provide a useful baseline for analyzing trends in our underlying business. Non-GAAP financial measures should be considered in addition to, and not as an alternative for, our reported results prepared in accordance with GAAP. Our non-GAAP financial information does not represent a comprehensive basis of accounting. Therefore, our non-GAAP financial information may not be comparable to similarly titled measures reported by other companies.

This design combines internal business performance measures as well as an external relative performance measure. This combination balances efforts to motivate and reward the management team for our operational and financial success, while ensuring rewards remain aligned with shareowner interests and returns.target. A description of each performance measure and the operation of the RTSR modifier follows:

●Adjusted Earnings Per Share Growth1

Growth in

Adjusted Consolidated Revenue

Growth in adjusted consolidated revenueearnings per share growth measures the Company’s long-termour success in growing our businessincreasing profitability as compared with the targets adopted at the beginning of the performance period. OnAdjusted earnings per share is determined by dividing the grant date,Company’s adjusted net income available to common shareowners by the Compensation Committee approves andiluted weighted average consolidated projected revenueshares outstanding during the performance period. For this purpose, adjusted net income is determined by reference to our publicly reported adjusted net income. The adjusted earnings per share growth target for the three-year performance period (the target is the projected average annual revenueadjusted earnings per share growth percentageduring each of the three years within the applicable performance period. The actual adjusted earnings per share growth for each year of the performance period). Following the completion of theapplicable performance period the Committee will certify the actual revenue growth and the performance result compared to the target (each year’s growth percentage will be compared to the target and assigned a payout percentage; the average of the three payout percentages will be used to calculate the final performance result). Atpayout percentage under this metric. Following the endcompletion of the applicable performance period, the Committee will certify (i) the actual adjusted earnings per share growth for the performance period; (ii) the actual adjusted earnings per share growth for the performance period as compared to the target; and (iii) the final revenue payout percentage for the grant. For purposes of calculating adjusted consolidated revenue, GAAP total revenue is adjusted to exclude the effect of unusual or infrequently occurring items, charges for restructurings (employee severance liabilities, asset impairment costs, and exit costs), discontinued operations, extraordinary items and the cumulative effect of changes in accounting treatment. In addition, consolidated revenue is calculated on a currency constant basis.this metric.

●Adjusted Free Cash Flow1

Adjusted Operating Return on Invested Capital

Adjusted operating return on invested capitalfree cash flow measures the Company’sour ability to generate cash after accounting for capital expenditures. Adjusted free cash flow is determined by reducing the highest long-term returns on itsCompany’s adjusted cash flow from operations by adjusted capital allocation decisions. Onexpenditures and proceeds from disposals of fixed assets, and adjusting for net changes in finance receivables, other investing activities and discretionary pension contributions. The adjusted free cash flow target is the grant date,projected aggregate adjusted free cash flow generated during the Compensation Committee approves a ROIC target for the three-yearapplicable performance period. Following the completion of the applicable performance period, the Committee will certify (i) the actual adjusted operating ROIC andfree cash flow for the comparison ofperformance period; (ii) the actual adjusted operating ROICfree cash flow for the performance period as compared to the target; and (iii) the final payout percentage for this metric.

●Relative Total Shareowner Return

Total shareholder return is the total return on an investment in UPS stock to an investor (stock price appreciation plus dividends). This is compared with the target. The target istotal return on the average of eachstock of the three years projected operating

ROIC (operating income forcompanies in the three-year period divided byIndex at the sumbeginning of average invested capital for the three-year period). For purposes of determining the performance results: GAAP operating income is adjusted to exclude pension mark-to-market adjustments, the effect of unusual or infrequently occurring items, charges for restructurings (employee severance liabilities, asset impairment costs, and exit costs), discontinued operations, extraordinary items and the cumulative effect of changes in accounting treatment; and GAAP invested capital is adjusted to exclude the impacts of certain items that were not anticipated in establishing the ROIC target, such as incremental invested capital from business acquisitions, the effect of unusual or infrequently occurring items, restructuring reserves, or other extraordinary items.

Relative Total Shareowner Return

Relative TSR is measured by covering our TSR to the TSR a peer group of companies during a three-yearapplicable performance period. The Compensation Committee evaluates the peer group annuallywill assign a percentile rank relative to determine if the companies includedlisted in the group are the most appropriate comparators for measuring the success of our executives in delivering shareowner value.

Three-Year TSR Compared
to Peer Group		Percentage of Target Earned for
TSR Portion of LTIP Award
Greater than 75thPercentile200%
Median100%
25thPercentile50%
Less than 25thPercentile0%

The maximum payout for the TSR portion of the award is capped at 200% of target. If our TSR over the three-year measurement period is negative, even if it exceeds the median of the peer group, the maximum payout percentage for the TSR portion of LTIP awards is capped at 100% of target.

2018 LTIP Awards

The Compensation Committee approved the following target values as a percent of base salary for the 2018 LTIP awards:

Executive OfficersLTIP Target
(% Base Salary)
Chief Executive Officer700
Chief Operating Officer575
Chief Financial Officer450
Chief Strategy and Transformation Officer450
Other executive officers350

Target values areIndex based on internal pay comparison considerations and market data regarding total compensation of comparable positions at similarly sized companies. Differences in the target award values are based on increasing levels of responsibility among the executive officers.


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The threshold, target and maximum number of RPUs that can be earned by the Named Executive Officers under the 2018 LTIP is shown in the Grants of Plan-Based Awards table. The actual number of RPUs that the Named Executive Officers will receive is determined followingRTSR. Following the completion of the Performance Period, the Committee will certify the Company’s RTSR and the payout modifier for that performance period, ending December 31,if any, as follows:

RTSR Percentile Rank
Relative to Index		Payout Modifier
Above 75th percentile+20%
Between 25th and 75th percentileNone
Below 25th percentile-20%
(1)Non-GAAP financial measures. We believe that these non-GAAP measures are appropriate for the determination of our incentive compensation award results because they exclude items that may not be indicative of, or are unrelated to, our underlying operations and provide a useful baseline for analyzing trends in our underlying business. Non-GAAP financial measures should be considered in addition to, and not as an alternative for, our reported results prepared in accordance with GAAP. Our non-GAAP financial information does not represent a comprehensive basis of accounting. Therefore, our non-GAAP financial information may not be comparable to similarly titled measures reported by other companies.
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2019 LTIP Award Payout

The performance metrics for 2019 LTIP awards were growth in adjusted consolidated revenue, adjusted operating return on invested capital and RTSR (for the 2019 LTIP award RTSR was a separate performance metric and not a modifier), each as described in our proxy statement for our 2020 and is based on achievementannual meeting of shareowners. Each of the performance goalsthree metrics was evaluated independently and weighted equally in determining award payouts. Performance targets and actual results for the three-yearcompleted performance period described above. TSR is measured based on our TSR compared tofor the 17 peer companies listed previously as measured from January2019 LTIP awards (January 1, 20182019 through December 31, 2020,2021) are set out below. RPUs awarded under the three-year performance period. The maximum2019 LTIP award that can beare considered earned is 200%and vested.

* Growth in adjusted consolidated revenue was calculated on a constant currency basis using 2019 levels as the baseline. Adjusted consolidated revenue and adjusted operating return on invested capital were adjusted for the divestiture of UPS Ground Freight, Inc.
** Growth in adjusted consolidated revenue is measured annually, with payout maximized if growth of at least 8.9% is achieved in that year. The final result is an average of the three outcomes within the performance period. This method may result in a higher or lower payout than a three-year compound growth calculation, depending upon performance in each of the individual years.
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Stock Option Program and 20182021 Stock Option Awards

The Compensation Committee believes that stockStock options providecreate a significantdirect link tobetween Company performance and motivate recipients to maximizemaximization of shareowner value. The option holder receives value only if our stock price increases. Stock options alsoand have retention value; the option holder will not receive value from thevalue. Our stock options unless he or she remains employed during the vesting period.

Stock optionsgenerally vest 20% per year over five years and expire ten years from the date of grant. We do not maintain additional holding period requirements. The option holder will not receive any value unless they remain employed during the vesting period. Unvested stock options vest automatically upon termination of employment because of death, disability or retirement. In light of the five-year vesting schedule, we do not maintain additional holding period requirements. Grants do not include dividend equivalents or any reload features.

In March 2018, the Compensation Committee approved 2018 target award values for stock options at 90% of base salary for the Chief Executive Officer, 50% of base salary for the Chief Operating Officer, the Chief Financial Officer and the Chief Strategy and Transformation Officer, and 30% of base salary for the other NEOs. The number of stock options granted to the NEOs in 20182021 is shown in the Grants“Grants of Plan-Based AwardsAwards” table.

Total 2018 Long-Term Equity Incentive Award Target Values

The total long-term incentive opportunity granted to the Named Executive Officers in 2018, based upon a percentage of annualized base salary, is shown below.

Named Executive Officer     LTIP RPUs
(% Base
Salary)		     Options
(% Base
Salary)		     Total
(% Base
Salary)
David P. Abney70090790
Richard N. Peretz45050500
James J. Barber, Jr.57550625
Scott A. Price45050500
Kevin M. Warren(1)———

(1)Kevin Warren was not eligible to receive a 2018 LTIP award or 2018 Stock Option award because his employment did not begin until after the grant dates.


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2016 LTIP Performance TargetsEmployment Transition Awards, Retention Arrangements and ResultsRecognition Awards

In 2016, the Compensation Committee approved LTIP awards for the NEOs who were employees of the Company at that time. The performance metrics for the 2016 LTIP awards were the same as those described above under the LTIP Award Program heading. The performance targets and actual results for the completed performance period for the 2016 LTIP awards are in the tables below. The combined Total Payout for the 2016 LTIP RPU Award, based on the 2016 through 2018 performance period, was 74% of target. RPUs awarded under the 2016 LTIP are now earned and vested.

Growth in Adjusted Consolidated Revenue*Adjusted Operating Return on Invested Capital*
Relative Total Shareowner Return*

Actual Payout for 2016 LTIP RPU Award
as a Percent of Target

74%


*Revenue is adjusted for currency using 2016 target rates; revenue excludes the impact from the new revenue recognition standard; and ROIC was adjusted for the impact of new pension accounting standards and for capital expenditures associated primarily with network expansion.

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2018 Employment Transition Payments

Generally, we do not pay discretionary bonuses in cash or stock, or make other discretionary payments, to our executives. However, in orderIn recent periods, however, to attract externaland retain senior executive talent to participate in the transformation of our business, the Compensation Committee approveddetermined it was appropriate to approve certain limited payments to two external executive hiresexecutives hired to the Company’s Management Committee. TheExecutive Leadership Team. A portion of the payments to the external hires were made to compensate the executives for compensation forfeited at their prior employers and transition them into our incentive programs. In addition, in connection with the hiring of Carol as CEO, the Committee determined it was appropriate to provide certain incentives to various executive officers in 2020 in order to provide for the retention of their services through a transition period.

Further, in 2021, the Committee granted Kate Gutmann a one-time award valued at $350,000 in recognition of her extraordinary contributions and performance during 2020. This award consisted of $175,000 of RSUs which vest as follows: 25 percent on March 25, 2022; 25 percent on March 25, 2023; and 50 percent on March 25, 2024; and a stock option award with a grant date fair value of $175,000 which vests 20% per year over five years beginning on March 25, 2022, provided she remains an employee of UPS through the applicable vesting dates.

Under the terms of his 2019 employment offer letter, described below, in 2018 Scott PriceBrian Newman was entitled to: (i) a grant of RSUs with a value of $5,500,000, which vested in March 2020; (ii) a performance-based cash award with a target value of $3,000,000, payable in equal installments in March 2021 and March 2022, with the actual payout equal to receive; (i)the Company’s LTIP payout percentage based on the Company’s performance under the LTIP for periods ending December 31, 2020 and December 31, 2021, respectively; and (iii) a cash transition payment of $500,000; and (ii)$600,000 paid in March 2020. These amounts are subject to repayment on a one-timeprorated basis if he resigns without “good reason” or is terminated for “cause” within 36 months following his September 2019 start date.

Under the terms of his 2017 employment offer letter, Scott Price was entitled to: (i) a RSU grant valued at

$4 million which vests $4,000,000 vesting in 20% equal annual increments annually, frombeginning January 2018, through January 2022, subject to his continued employment through each applicable vesting date or termination without cause.

Under the terms of his employment offer letter described below, in 2018 Kevin Warren was entitled to receive; (i) acause; (ii) cash transition paymentpayments of $950,000;$2,000,000 in each of March 2019 and (ii) a one-time RSU grant valued at $32020.

In connection with our CEO transition, in May 2020, we entered into retention arrangements with each of Nando Cesarone and Kate Gutmann. The Committee initially intended that these agreements contain both performance and time vesting components, and that the performance components be different than the metrics under our MIP and LTIP programs. Due to the uncertainty created by the COVID-19 pandemic and the importance of the retention agreements to the Company, the Committee ultimately determined that the awards would be time based. Nando and Kate each received $3.0 million in RSUs which vests in one-third increments annually, from January 2019vest as follows: 25% on May 13, 2021, 25% on May 13, 2022 and 50% on May 13, 2023, provided they remain an employee of UPS through January 2021, subject to his continued employment through eachthe applicable vesting date or termination without cause.date. In accordance with the rules and regulations of the SEC, the full value of these awards is included in each individual’s 2020 compensation as reported in the 2021 Summary Compensation Table. These agreements contain customary non-competition, non-solicitation and non-disclosure covenants in favor of the Company.


Benefits and Perquisites

Benefits and Perquisites

The benefits and perquisites provided to our Named Executive OfficersNEOs are not a material part of executive compensation and are largely limited to those offered to our employees generally, or that we otherwise believe are necessary or appropriate to attract and retain executive talent. We believe certain perquisites help facilitate our NEOs’ ability to carry out their responsibilities, maximize working time and minimize distractions. Additional information on these benefits can be found in the following program descriptions below.descriptions.

The UPS 401(k) Savings Plan

The UPS 401(k) Savings Plan is offeredopen to all U.S.-based employees who are not subject to a collective bargaining agreement and who are not eligible to participate in another savings plan sponsored by UPS or one of its subsidiaries. We generally match 50% of up to 5% of eligible pay contributed to the UPS 401(k) Savings Plan for eligible employees hired on or before December 31,

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2007, 100% of up to 3.5% of eligible pay contributed to the plan for eligible employees hired on or after January 1, 2008, and 50% of up to 6% of eligible pay contributed to the plan for employees hired on or after July 1, 2016. The match is paid in shares of class A common stock. Effective for newly eligible plan participants on or after July 1, 2016, we also generally provide a Retirement Contribution based on years of service and expressed as a percentage of eligible compensation (5% for 0-4 years, 6% for 5-9 years, 7% for 10-14 years and 8% for 15 or more years).

Qualified and Non-Qualified Pension Plans

Certain executive officers are eligible to participate in our qualified retirement program, the UPS Retirement Plan. Benefits payable under the plan are subject to the maximum compensation limits and the annual benefit limits for a tax-qualified defined benefit plan as established by the Internal Revenue Service. Amounts

exceeding these limits are paid pursuant to the UPS Excess Coordinating Benefit Plan, which is a non-qualified restoration plan designed to replace the amount of benefits limited under the tax-qualified plan. Without the Excess Coordinating Benefit Plan, the executive officers would receive a lower benefit as a percent of final average earnings than the benefit received by other participants in the UPS Retirement Plan. In accordance with the terms of the Excess Coordinating Benefit Plan, following a participant’s retirement, the Company pays an amount equal to the Social Security and Medicare taxes due on the present value of the benefits provided under the plan.

Financial Planning Services

Our executive officers are eligible for a financial services benefit. The Company reimburses fees from financial and tax service providers up to $15,000 per year, including the cost of personal excess liability insurance coverage.

Executive Health Services

Our executive officers are eligible for certain executive health services benefits, including comprehensive physical examinations. UPS’s business continuity is best facilitated by avoiding any prolonged or unexpected absences by members of its senior management team. In 2018, executive officers were offered certain executive health services, including comprehensive physical examinations.

Discounted Employee Stock Purchase Plan

We have maintained aOur Discounted Employee Stock Purchase Plan since 2001. The plan provides all U.S.-based employees, including the Named Executive Officers,NEOs, and some internationally based employees, with the opportunity to purchase up to $10,000 in our class A common stock annually at a discount to the market price of our stock. The plan complies with Section 423 of the Internal Revenue Code.price. Our class A common stock may be acquired under the plan at a purchase price equal to 95% of the fair market value of the shares on the last day of each calendar quarter. Share purchases are made on a quarterly basis.


40      Notice of Annual Meeting of Shareowners and 2019 Proxy Statement

TableThe plan complies with Section 423 of Contentsthe Internal Revenue Code.

Other Compensation and Governance Policies

Other Compensation and Governance Policies

Stock Ownership Guidelines

CEO= 8x annual salary
Other Executive Officers= 5x annual salary
Directors= 5x annual retainer

The board has adoptedWe maintain stock ownership guidelines that apply to executive officers and to members of our Board of Directors. The guidelines further our core philosophy that executive officers should also be long-term owners of our Company. Target ownership is eight times annual salary for our Chief Executive Officer and five times annual salary for our other executive officers. The target for our non-employee directors is five times their annual retainer.the board. Shares of class A common stock (excluding any pledged shares), deferred units and vested and unvested RSUs and RPUs awarded under our equity incentive plans are considered owned for purposes of calculating ownership. Executive officers and directors are expected to reach target ownership within five years of adoption of the guideline or the date that the executive officer or director became subject to the guideline.

As of December 31, 2018,2021, all of the Named Executive OfficersNEOs who have been subject to the guidelines for at least five years exceeded their target stock ownership. In addition, all of our non-employee directors who have been subject to the stock ownership guidelines for at least five years exceeded their target stock ownership. RSUs are required to be held by a non-employee directordirectors until he or she separatesseparation from the UPS Board of Directors.board.

Hedging and Pledging Policies

We prohibit our executive officers and directors from hedging their ownership in UPS stock. Specifically, they are prohibited from purchasing or selling derivative securities relating to UPS stock and from purchasing financial instruments that are designed to hedge or offset any decrease in the market value of UPS securities. Additionally, in 2014 we have adopted a policy prohibiting our directors and executive officers from entering into pledges of UPS securities, including using UPS securities as collateral for a loan and holding UPS securities in margin accounts. Executive officers are encouraged (but not required) to unwind any existing pledges. Furthermore, our employees, officers and directors are prohibited from engaging in short sales of UPS stock.

Clawback Policy

Our incentive compensation plans contain clawback provisions forapplicable to all awards granted under the plans.outstanding awards. If the Compensation Committee determines that financial results used to determine the amount of any award are materially restated, and that an executive officer engaged in fraud or intentional misconduct, we willthe Committee is entitled to seek repayment or recovery of the award from that executive officer. This clawback applies to all awards granted under the 2018 Plan, the 2015 Plan, our 2012 Omnibus Incentive Compensation Plan (“2012 Plan”)

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Employment and our 2009 Incentive Compensation Plan (“2009 Plan”).

Employment,Severance Arrangements; Change in Control or Severance AgreementsPayments

WeUPS has created a culture where long tenure for executives is the norm. Consequently, we do not enter into employment agreements providing for the continuation of employment, of an executive, or separate change in control agreements with any of our executive officers, including our Named Executive Officers. Our Compensation Committee believes that UPS has created a culture where long tenure for executives is the norm. As a result, executive officers serve without employment contracts, as do most of ourNEOs, or other U.S.-based non-union employees.

However, in orderrecent periods, to attract and retain senior executive talent from outside the Company to participate in the transformation of our business and in furtherance of the board’s succession planning efforts, we executedhave entered into various employment offer letters, transition agreements, retention arrangements and noncompete agreements in favor of UPS. These arrangements may provide for compensation to an executive, but do not guarantee an employment term; employment is on an at-will basis. Some of the agreements were designed to compensate the individuals for compensation forfeited at their prior employers, to transition them into our incentive programs or to provide consideration for their agreement not to compete with UPS following their separation. In addition, potential compensation provided by retention arrangements is intended to incentivize those individuals to maintain their employment with UPS.

In connection with her appointment as Chief Executive Officer, on March 11, 2020, the Company entered into an employment offer letter with Scott Price, effective November 28, 2017, in connection with his hiring as our Chief Transformation Officer. We also executedCarol Tomé providing for: (i) an employment offer letter with Kevin Warren, effective May 5, 2018, in connection with his hiring as our Chief Marketing Officer. These offer letters have no specified duration and provide that employment is on an at-will basis.

Under the terms of Scott Price’s offer letter, he is entitled to, among other things, the cash transition and equity payment described above under “2018 Employment Transition Payments”, as well as cash transition payments of $2.0 million in each of March 2019 and 2020, subject to his continued employment on those dates. Under the terms of Kevin Warren’s offer letter, he is entitled to, among other things, the cash transition and equity payments described above under “2018 Employment Transition Payments”, as well as cash transition payments of $750,000 in each of June 2019 and 2020, subject to his continued employment on those dates. Both offer letters also define annual base salary levels, eligibilityof $1,250,000 (subject to participate in thefuture increase); (ii) a MIP award target of 165% of base salary; (iii) a LTIP program award target of 735% of base salary; and Stock Option programs, and eligibility for relocation benefits and other employee benefits, all consistent with those received by our other senior executives. Both offer letters also provide that the equity payments described in the “2018 Employment Transition Payments” section above will continue to vest in the event that the NEO is terminated without cause.(iv) a stock option grant target of 90% of base salary.

Scott Price and Kevin WarrenCarol also entered into a protective covenant agreements with usagreement, which protects UPS’s confidential information and includes non-competition and non-solicitation covenants in the event they arefavor of UPS. It also provides for continued payment of her base salary for up to 24 months if her employment is terminated by UPS without cause during the first“cause” within two years of employment, provide for (i) separation pay equal to two years’ salary, (ii) continued vesting of their one-time RSU grants, and (iii) with respect to Kevin Warren, the payment of any unpaid transition payments (see “2018 Employment Transition Payments” described above).following her start date. In the event either of them areshe is terminated without cause after the first two years of employment, the Company is obligated to make such payments and continue vesting such grants if it elects to enforce the post-termination non-compete covenants.

In connection with his appointment as Chief Financial Officer, on August 7, 2019, the Company entered into an employment offer letter with Brian Newman providing for: (i) an annual base salary of $725,000 (subject to future increase); (ii) a MIP award target of 130% of base salary; (iii) a LTIP program award target of 550% of base salary; (iv) a stock option grant target of 50% of base salary; (v) a grant of UPS restricted stock units with a value of $5,500,000, which vested in March 2020; (vi) a performance-based cash award with a target value of $3,000,000, which was paid in equal installments in March 2021 and March 2022, based on the Company’s performance under the LTIP for periods ending December 31, 2020 and December 31, 2021, respectively; and (vii) a cash transition payment of $600,000 paid in March 2020.

These amounts are subject to repayment on a prorated basis if he resigns without “good reason” or is terminated for “cause” within 36 months following his September 2019 start date.

Under the terms of his 2017 employment offer letter, Scott Price was entitled to: (i) a RSU grant valued at $4,000,000 vesting in 20% equal annual increments beginning January 2018, subject to his continued employment through each applicable vesting date or termination without cause; and (ii) cash transition payments of $2,000,000 in each of March 2019 and 2020.

Brian and Scott also entered into protective covenant agreements with us, which protect UPS’s confidential information and include non-competition and non-solicitation covenants connectedin favor of UPS. In the event either of them is terminated without cause, the Company is obligated to those agreements.make separation payments equal to two years’ salary if it elects to enforce the post-termination non-compete covenants.

On March 1, 2022, UPS announced that Scott Price is retiring on March 31, 2022 (the “separation date”). We have entered into a separation agreement with Scott (the “Price Separation Agreement”), pursuant to which we will provide certain severance compensation and benefits to Scott in lieu of any benefits under Scott’s protective covenant agreement. The 2018 Plan requiresPrice Separation Agreement provides that Scott will receive, in addition to certain accrued compensation and benefits, a “double trigger” — bothlump sum cash severance payment equal to $912,151.20, representing (A) one-year of base salary and (B) a changepro-rata portion of Scott’s target award under the 2022 MIP. In addition, Scott’s equity awards outstanding as of the separation date will be treated as follows: (1) RPUs granted in control2022 with respect to the 2021 MIP will vest in full immediately following the separation date; (2) each RPU award granted under the LTIP will remain eligible to vest on a pro-rata basis, subject to actual performance for the full applicable performance period; and a qualifying termination(3) his outstanding stock options (to the extent vested) will remain exercisable for 90 days following the separation date. The Price Separation Agreement includes certain customary protective covenants in favor of employment —the Company, including confidentiality, employee and customer non-solicitation, non-competition, and non-disparagement provisions. For more information regarding these benefits, see “Potential Payments Upon Termination or Change in Control” below.

Under the terms of the retention arrangements with Nando Cesarone and Kate Gutmann, each entered into customary non-competition, non-solicitation and non-disclosure agreements in favor of the Company. If any of them are terminated without cause or resign for “good reason”, their RSU awards will continue to acceleratevest on the vesting ofschedule above.

All outstanding equity awards that are not continued or assumed by a successor entity. Equity awards grantedentity in connection with a change in control require a “double trigger” for vesting to theaccelerate; that is, they also require a qualifying termination of employment prior to any acceleration of vesting.


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Named Executive Officers prior to May 7, 2009 are subject to a single trigger, while equity awards granted after that date are subject to the double trigger.Compensation

Equity Grant Practices

Grants of awards to executive officers under all of our equity incentive programs are approved by the Compensation Committee. Stock options have an exercise price equal to the NYSE closing market price on the date of grant.


Consideration of Previous “Say on Pay” Voting Results

Our shareowners vote annually, on an advisory basis, to approve the compensation of Previous “Say on Pay” Voting Results

We regularly engage with our shareowners onNEOs as set out in the Compensation Discussion and Analysis section and in the compensation tables and accompanying narrative disclosure in the Proxy Statement. See “Proposal 2 – Advisory Vote to Approve Named Executive Officer Compensation.” In the most recent advisory vote to approve named executive officer compensation, matters. At our 2017taken at the 2021 Annual Meeting of Shareowners, over 88%90% of votes cast approved our NEO compensation program as described in our 2017 proxy statement. In making compensation decisions, the Compensation2021 Proxy Statement. The Committee carefully considered the results of the most recent say on paythis vote as well as many other factors as described hereinin determining the structure and did not make any changes tooperation of our executive compensation programs as a result of the most

recent say on pay vote.programs. In addition, a majority (over 61%)we regularly engage with our stakeholders, including on executive compensation matters. We use the results of votes cast for the shareowner “say on frequency” vote at our 2017 Annual Meeting expressed a preference for having a say on pay vote every three years. As a result, our next say on pay vote is scheduled for the 2020 Annual Meeting. We welcome input from our shareownersthese engagements to inform board discussions on our compensationcorporate governance policies and compensation program at any time, not just in the years when we conduct a say on pay vote.practices.


Tax Implications of Executive Compensation
   43

The Compensation Committee had previously structured annual and long-term incentive compensation awards with the intention of complying with the performance-based compensation exemption from Section 162(m) of the Internal Revenue Code, which allows a tax deduction for compensation paid to certain Named Executive Officers in excess of $1 million. The Compensation Committee did, however, reserve the right to modify compensation that was initially intended to be exempt from Section 162(m) and to pay compensation that was not deductible under Section 162(m) if it determined that such modifications or payments were needed to attract, retain, or provide incentives to our NEOs, and were consistent with the Company’s best interests.

Now that the exemption from Section 162(m)’s deduction limit for performance-based compensation has been repealed by the Tax Cuts and Jobs Act of 2017 (the “Tax Act”), the Compensation Committee expects that compensation granted or paid in 2018 and future tax years will not be fully deductible for income tax purposes. The Compensation Committee intends to maintain the strong pay-for-performance alignment of our incentive compensation programs and believes the interests of our shareowners are best served by not limiting the Compensation Committee’s discretion and flexibility in crafting compensation plans and arrangements, even though some compensation awards may result in non-deductible compensation expenses.


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2021 Summary Compensation Table

The following table shows Named Executive Officersets forth the compensation for fiscal years ended December 31, 2018, 2017of our NEOs. As previously disclosed, as a result of circumstances arising from the COVID-19 pandemic, 2020 LTIP program awards were granted with two separate performance periods. In accordance with generally accepted accounting principles (“GAAP”), we are required to present in the “Stock Awards” column of the 2021 Summary Compensation Table: (i) 100% of the target value of the 2021 LTIP program awards; and 2016.(ii) 80% of the target value of the 2020 LTIP program awards.

Name and
Principal Position		YearSalary
($)(3)		Bonus
($)		Stock
Awards
($)(4)		Option
Awards
($)(5)		Non-Equity
Incentive Plan
Compensation
($)(6)		Change in
Pension
Value
($)(7)		All Other
Compensation
($)(8)		Total
($)
David P. Abney   2018    1,234,992    —    10,459,956    1,087,039    937,739    1,311,718    29,432    15,060,876
Chief Executive Officer20171,199,016—9,354,6991,055,372672,0462,296,31531,28414,608,732
20161,082,421—9,172,450991,275387,7412,052,15238,53313,724,572
Richard N. Peretz2018552,654—3,032,070271,257280,493480,71318,0554,635,242
Chief Financial Officer2017538,533—2,769,256263,351199,934917,55013,5164,702,140
2016485,070—2,766,672246,812146,0341,478,42021,9455,144,953
James J. Barber, Jr.2018693,676—5,003,423281,041449,000586,46431,9007,045,504
Chief Operating Officer2017557,304—2,871,021271,538269,7591,040,77125,1505,035,543
2016500,706—2,879,564251,731158,384858,78527,3944,676,564
Scott A. Price(1)2018613,500500,0006,911,263300,015——155,6198,480,397
Chief Strategy and
Transformation Officer
Kevin M. Warren(2)2018350,000950,0003,000,030———124,6134,424,643
Chief Marketing Officer

Consequently, we believe amounts in the 2021 Summary Compensation Table are not indicative of the compensation awarded to our NEOs in 2021, and overstate the value awarded. Therefore, following the 2021 Summary Compensation Table, we present a Supplemental 2021 Compensation Table including only the target value of the 2021 LTIP awards.

Name and
Principal Position		   Year   Salary
($)(1)		   Bonus
($)		   Stock
Awards
($)(2)		   Option
Awards
($)(3)		   Non-Equity
Incentive Plan
Compensation
($)(4)		   Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)(5)		   All Other
Compensation
($)(6)		   Total
($)
Carol Tomé 2021 1,336,251 — 23,670,426 1,125,023 1,397,139 — 92,054 27,620,893
Chief Executive Officer 2020 729,169 — 1,833,812 1,125,010 — — 84,919 3,772,910
Brian Newman 2021 760,764 — 10,934,230 373,401 3,128,793 — 56,690 15,253,878
Chief Financial Officer 2020 741,321 600,000 991,596 362,505 2,555,238 — 96,784 5,347,444
  2019 212,898 — 5,500,084 — — — 27,139 5,740,121
Scott Price 2021 680,220 — 7,990,464 327,828 460,152 — 79,143 9,537,807
President, 2020 650,859 2,000,000 834,682 318,280 373,346 — 74,901 4,252,068
UPS International 2019 631,905 2,000,000 3,979,882 309,001 128,015 — 85,103 7,133,906
Nando Cesarone President, 2021 683,361 — 7,218,244 313,487 475,914 — 98,089 8,789,095
U.S. Operations 2020 606,495 — 3,699,097 163,548 357,008 — 60,728 4,886,876
Kate Gutmann 2021 745,803 — 6,659,398 390,681 511,579 48,547 19,690 8,375,698
Chief Sales and Solutions Officer 2020 688,896 — 3,664,545 179,714 409,344 354,807 19,322 5,316,628
(1)Scott Price joinedRepresents the Company in December 2017. See “Employment, Change in Control or Severance Agreements” insalary earned during the Compensation Discussion and Analysis for a descriptionportion of the transition and equity amounts provided in connection with his decision to joinyear that the Company.
executive was employed.
(2)Kevin Warren joined the Company in June 2018. See “Employment, Change in Control or Severance Agreements” in the Compensation Discussion and Analysis for a description of the transition and equity amounts provided in connection with his decision to join the Company.
(3)This column represents the salary earned from January 1 through December 31 of the applicable year. Base salary increases generally are effective in April of the relevant fiscal year.
(4)The values for stock awards in this column representRepresents the aggregate grant date fair value for the stock awards granted in the applicable year, computed in accordance with FASB ASC Topic 718. These awards include LTIP RPUs, MIP RPUs, and the one-time grantspecial grants of RSUs made to Scott PriceKate Gutmann. As described above, the grant date fair value of LTIP RPU awards for 2021 includes 100% of the target value of the award granted in 2021 and Kevin Warren.80% of the target value of the award granted in 2020. The grant date fair value of the 2020 LTIP RPU awards reported for 2020 included only 20% of the target award value. Awards with performance conditions are computedvalued based on the probable outcome of the performance condition as of the grant date for the award. Information about the assumptions used to value these awards can be found in Note 1114 “Stock-Based Compensation” in our 20182021 Annual Report on Form 10-K. The amounts reported for these awards may not represent the amounts that the individuals will actually receive. The amounts received, if any, ultimately will depend on Company performance and the change in our stock price over time. An overview of the features of these awards can be found in the “Compensation Discussion and Analysis”.
Analysis.”
In accordance with SEC rules, we also are required to disclose the grant date fair value for awards with performance conditions assuming maximum performance. The grant date fair value for the 20182021 LTIP RPU awards, assuming maximum performance, are as follows: Abney — $18,231,704; Peretz — $5,264,211; Barber — $8,927,646; and Price — $5,822,284. Kevin Warren was not eligible to participate inplus the 2018 LTIP because he was not employed whenportion of the awards were made. The grant date fair value forof the 20172020 LTIP RPU awards reported for 2021, assuming maximum performance, areis as follows: AbneyTomé — $16,416,794; Peretz$48,626,464; Newman — $4,740,276;$22,184,210; Price — $15,936,071; Cesarone — $14,308,983; and BarberGutmann — $4,887,556. The grant date fair value for the 2016 LTIP RPU awards, assuming maximum performance, are as follows: Abney — $14,417,934; Peretz — $4,252,261; and Barber — $4,387,058.
$12,464,544.
(5)(3)The values for stock option awards representRepresents the aggregate grant date fair value for the option awards granted in the applicable year, computed in accordance with FASB ASC Topic 718. The assumptions used to value these awards can be found in Note 1114 “Stock-Based Compensation” in our 20182021 Annual Report on Form 10-K. The amounts reported for these awards may not represent the amounts that the individuals will actually receive. The amounts received, if any, ultimately will depend on the change in our stock price over time. An overview of the features of these awards can be found in the “Compensation Discussion and Analysis” section. Kevin Warren was not eligible to receive a 2018 Stock Option award because his employment began after the grant date.
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Executive Compensation

(4)Represents the cash portion of the MIP Performance Incentiveperformance incentive award and the MIP Ownership Incentiveownership incentive award. For a description of the MIP, see “Compensation Discussion and Analysis”.Analysis.” The MIP Ownership Incentiveownership incentive award was paid at 100% of target (one month’s salary) for each eligible Named Executive OfficerNEO who met or exceeded his or her target ownership level in the same proportion that the MIP award is paid. Also, for Brian Newman, represents the portion of the performance-based cash award granted under his employment offer letter.

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(7)This column representsRepresents an estimate of the annual increase in the actuarial present value of the Named Executive Officer’sNEOs’ accrued benefit under our retirement plans for the applicable year, assuming retirement at age 60 (or current age, if greater)later). See “Executive Compensation — 20182021 Pension Benefits” for additional information, including assumptions used in this calculation. The change in pension value can be impacted by a number of factors, including additional credited service, changes in amounts of compensation covered by the benefit formula, plan amendments and assumption changes.
(8)(6)The following table breaks downAll other compensation consisted of the amounts shown in this column for 2018:following:

Name401(k)Plan
Retirement
Contribution(1)($)		401(k)Plan
Match ($)		Life
Insurance ($)		Financial
Planning ($)		Healthcare
Benefits ($)		Other(2)($)Total ($)
David P. Abney     —     6,875     9,385     6,468     6,704     —     29,432
Richard N. Peretz—6,8752,5941,8826,704—18,055
James J. Barber, Jr.—6,8753,32115,0006,704—31,900
Scott A. Price13,7508,2502,9087,3026,704116,705155,619
Kevin M. Warren13,750—1,65615,0005,75488,453124,613

Name    401(k) Plan
Retirement
Contributions(1)
($)		    Restoration
Savings Plan
Contributions(2)
($)		    401(k)
Plan
Match
($)		    Life
Insurance
Premiums
($)		    Financial
Planning
Services
($)		    Healthcare
Benefits
($)		    Total
($)
Carol Tomé 14,250 32,737 14,125 10,187 15,000 5,755 92,054
Brian Newman 14,250 11,023 8,700 1,962 15,000 5,755 56,690
Scott Price 14,250 37,192 8,700 4,991 8,255 5,755 79,143
Nando Cesarone 22,800 43,167 10,125 1,748 14,494 5,755 98,089
Kate Gutmann — — 7,250 1,920 4,765 5,755 19,690
(1)For newly eligible plan participants hired after July 1, 2016, we generally provide a retirement contribution based on years of service.
(2)For Scott Price and Kevin Warren, consists of relocation expenses. These amounts were valued oneligible plan participants hired after July 1, 2016, benefits payable under the basis of the aggregate incremental costUPS 401(k) Savings Plan are subject to the Companymaximum compensation limits and represent the amount accruedannual benefit limits for payment ora tax-qualified defined contribution plan as established by the Internal Revenue Service. Amounts exceeding these limits are paid pursuant to the service provider or the individual, as applicable.UPS Restoration Savings Plan.

Supplemental 2021 Compensation Table

The table below includes the target value of the 2021 LTIP awards in the “Stock Awards” column but excludes the 80% of the target value of the 2020 LTIP award required to be included in the 2021 Summary Compensation Table in accordance with GAAP. We believe this table is more representative of our NEOs’ 2021 compensation than the 2021 Summary Compensation Table. For ease of reference, we have highlighted the columns that differ from the 2021 amounts in the 2021 Summary Compensation Table. This table should not be viewed as a substitute for the required 2021 Summary Compensation Table.

Name    Salary
($)		    Bonus
($)		    Stock
Awards
($)		    Stock
 Option
Awards
($)		    Non-Equity
Incentive Plan
Compensation
($)		    Change in
Pension
Value and
Nonqualified
Deferred
Compensation
Earnings
($)		    All Other
Compensation
 ($)		    Total
($)
Carol Tomé 1,336,251 — 11,257,953 1,125,023 1,397,139 — 92,054 15,208,420
Brian Newman 760,764 — 5,039,975 373,401 3,128,793 — 56,690 9,359,623
Scott Price 680,220 — 3,756,311 327,828 460,152 — 79,143 5,303,654
Nando Cesarone 683,361 — 3,591,959 313,487 475,914 — 98,089 5,162,810
Kate Gutmann 745,803 — 3,560,102 390,681 511,579 48,547 19,690 5,276,402
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2021 Grants of Plan-Based Awards

The following table provides information about plan-based awards granted during 20182021 to each of the Named Executive Officers.NEOs. As discussed above, in accordance with GAAP, amounts in the “Estimated Future Payouts Under Equity Incentive Plan Awards” column and the “Grant Date Fair Value of Stock and Options Awards” column below reflect the full 2021 LTIP target value and a portion of the 2020 LTIP target value granted to the NEOs. The performance targets for this portion of the 2020 LTIP were approved in 2021 and were not reported in 2021 Grants of Plan-Based Awards table.

Estimated Possible Payouts
Under Non-Equity Incentive
Plan Awards(1)

Estimated Future Payouts
Under Equity Incentive
Plan Awards(2)		All Other
Stock
Awards:
Number
of Shares
of Stock
or Units
(#)(3)		All Other
Option
Awards:
Number of
Securities
Underlying
Options
(#)(4)		Exercise
or Base
Price of
Option
Awards
($/Sh)		Grant
Date
Fair Value
of Stock
and
Option
Awards
($)(5)
NameGrant
Date		Threshold
($)		Target
($)		Maximum
($)		Threshold
(#)		Target
(#)		Maximum
(#)
David P. Abney   —   —   684,229   1,666,667   —   —   —   —   —   —   —
5/9/2018———075,895151,790———9,115,852
3/1/2018———————71,328106.431,087,039
3/1/2018——————12,629——1,344,104
Richard N. Peretz——240,9521,666,667———————
5/9/2018———021,91443,828———2,632,106
3/1/2018———————17,799106.43271,257
3/1/2018——————3,758——399,964
James J. Barber, Jr.——312,0001,666,667———————
5/9/2018———037,16474,328———4,463,823
3/1/2018———————18,441106.43281,041
3/1/2018——————5,070——539,600
Scott A. Price———————————
5/9/2018———024,23748,474———2,911,142
3/1/2018———————19,686106.43300,015
1/5/2018——————31,344——4,000,121
Kevin M. Warren———————————
———————————
———————————
8/8/2018——————24,880——3,000,030

                All Other All Other   Grant 
                 Stock Option   Date 
                Awards:  Awards: Exercise  Fair Value 
  Estimated Possible Payouts Estimated Future Payouts Number  Number of  or Base  of Stock 
  Under Non-Equity Incentive  Under Equity Incentive  of Shares  Securities  Price of and 
  Plan Awards(1) Plan Awards(2)   of Stock  Underlying  Option Option 
  Grant Threshold Target Maximum Threshold Target Maximum or Units Options Awards Awards 
Name  Date ($) ($) ($) (#)  (#) (#) (#)(3)(#)(4)($/Sh)($)(5)
Carol Tomé — — 910,000 1,666,667 — — — — — — — 
  6/1/2020 — — — — 74,034 162,874 — — — 12,412,473 
  3/25/2021 — — — — 58,194 128,027 — — — 9,690,465 
  2/10/2021 — — — — — — — 47,619 165.66 1,125,023 
  2/10/2021 — — — — — — 9,462 — — 1,567,488 
Brian Newman — — 331,687 1,666,667 — — — — — — — 
  5/13/2020 — — — — 35,156 77,343 — — — 5,894,255 
  3/25/2021 — — — — 25,159 55,350 — — — 4,189,477 
  2/10/2021 — — — — — — — 15,805 165.66 373,401 
  2/10/2021 — — — — — — 5,134 — — 850,498 
Scott Price(6) — — 298,314 1,666,667 — — — — — — — 
  5/13/2020 — — — — 25,254 55,560 — — — 4,234,153 
  3/25/2021 — — — — 18,073 39,761 — — — 3,009,516 
  2/10/2021 — — — — — —   13,876 165.66 327,827 
  2/10/2021 — — — — — — 4,508 — — 746,795 
Nando Cesarone — — 304,273 1,666,667 — — — — — — — 
  5/13/2020 — — — — 21,629 47,583 — — — 3,626,285 
  3/25/2021 — — — — 17,282 38,020 — — — 2,877,799 
  2/10/2021 — — — — — — — 13,269 165.66 313,487 
  2/10/2021 — — — — — — 4,311 — — 714,160 
Kate Gutmann — — 327,075 1,666,667 — — — — — — — 
  5/13/2020 — — — — 18,486 40,668 — — — 3,099,296 
  3/25/2021 — — — — 15,412 33,906 — — — 2,566,406 
  2/10/2021 — — — — — — — 9,129 165.66 215,677 
  3/25/2021 — — — — — — — 6,657 163.25 175,004 
  2/10/2021 — — — — — — 4,942 — — 818,692 
  3/25/2021 — — — — — — 1,072 — — 175,004 
(1)Reflects, as applicable, the target and maximum values of the cash portion of the 20182021 MIP performance incentive award for each Named Executive Officer.NEO. A participant’s first MIP Performance Incentiveperformance incentive award is paid entirely in vested class A stock. Does not include the MIP ownership incentive award: Abney — $ 34,557; Peretz — $ 15,446; and Barber — $ 20,000. The potential payments for the MIP performance incentive award are performance-based and therefore at risk. The MIP program is described in the “Compensation Discussion and Analysis”.
Analysis.”
(2)These columns show the potentialPotential number of unitsRPUs that wouldcould be awardedearned under the 20182021 LTIP at the end of the applicable three-year performance period if the threshold, target or maximum performance goals are satisfied. Kevin Warren was not eligible to participate in the 2018 LTIP because he was not employed when the awards were made.
attained.
(3)This column representsRepresents the number of RPUs or shares of class A stock granted underin 2021 pursuant to the 2017 MIP2020 MIP. For Kate Gutmann, also represents a special grant of RSUs on March 1, 2018,25, 2021, which vest as follows: 25 percent on March 25, 2022; 25 percent on March 25, 2023; and includes50 percent on March 25, 2024, provided she remains an employee through the one-time RSUs granted to Scott Price on January 5, 2018 and to Kevin Warren on August 8, 2018.
applicable vesting dates.
(4)This column shows the numberNumber of stock options granted under the Stock Option program in 2021. For Kate Gutmann, also represents a special grant of stock options on March 1, 2018. Kevin Warren was not eligible to participate in25, 2021, which vests 20% per year over five years beginning on March 25, 2022, provided she remains an employee through the 2018 Stock Option program because he was not employed when the awards were made.
applicable vesting dates.
(5)This column shows the grantGrant date fair value under FASB ASC Topic 718 of the LTIP RPUs, MIP RPUs, stock options and the one-time RSUs under FASB ASC Topic 718special RSU award to Kate Gutmann, as applicable, granted to each of the Named Executive OfficersNEOs in 2018. The grant date fair2021. Fair values are calculated using the NYSE closing price of UPS stock on the date of grant for RPUs and RSUs, and the Black-Scholes option pricing model for stock options. The grant date fair value of the units granted under the 20182021 LTIP, which have performance conditions, are computed based on the probable outcome of the performance conditionconditions for the 20182021 LTIP performance period. Also includes the grant date fair value of the units based on the probable outcome of the performance conditions under the 2020 LTIP for the 2021-2022 performance period. There can be no assurance that the grant date fairany value of stock and option awards will ever be realized.
(6)As discussed above, pursuant to the Price Separation Agreement, upon Scott’s retirement from the Company on March 31, 2022, his 2021 LTIP RPU award will remain eligible to vest on a pro-rata basis, subject to actual performance for the full performance period, and his outstanding stock options (to the extent vested) will remain exercisable for 90 days following the separation date.

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Notice of Annual Meeting of Shareowners and 2022 Proxy Statement

Table of Contents

Executive Compensation

2021 Outstanding Equity Awards at Fiscal Year-End

The following table shows the number of shares covered by exercisable options, unexercisable options, and unvested RSUs and RPUs held by the Named Executive OfficersNEOs on December 31, 2018.2021.

Option AwardsStock Awards
NameNumber of
Securities
Underlying
Unexercised
Options
(#)
Exercisable		Number of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable(1)		Option
Exercise
Price
($)


Option
Grant
Date

Option
Expiration
Date		Number of
Shares or
Units of
Stock That
Have
Not Vested
(#)(2)		Market
Value of
Shares or
Units of
Stock That
Have
Not Vested
($)(3)		Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights That
Have Not
Vested
(#)(4)		Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights That
Have Not
Vested
($)(3)
David P. Abney   9,745   —   67.18   5/5/2010   5/5/2020            
9,357—74.255/4/20115/4/2021
9,620—76.893/1/20123/1/2022
9,461—82.873/1/20133/1/2023
5,8971,47596.983/4/20143/4/2024
14,9449,963101.933/2/20153/2/2025
10,65215,98098.773/2/20163/2/2026
15,04622,570106.869/16/20169/16/2026
14,35857,436106.873/1/20173/1/2027
—71,328106.433/1/20183/1/2028
32,3483,154,946160,18715,623,003
Richard N. Peretz2,0211,348101.933/2/20153/2/2025
3,1594,74098.773/2/20163/2/2026
3,1224,685106.869/16/20169/16/2026
3,58314,332106.873/1/20173/1/2027
—17,799106.433/1/20183/1/2028
9,979973,29046,2534,511,038
James J. Barber, Jr.3,714—76.893/1/20123/1/2022
8,135—82.873/1/20133/1/2023
5,0711,26896.983/4/20143/4/2024
4,5253,018101.933/2/20153/2/2025
3,2734,91098.773/2/20163/2/2026
3,1224,685106.869/16/20169/16/2026
3,69414,778106.873/1/20173/1/2027
—18,441106.433/1/20183/1/2028
12,8591,254,11062,6076,106,028
Scott A. Price—19,686106.433/1/20183/1/2028
25,8852,524,56524,8152,420,237
Kevin M. Warren—————
25,2762,465,138——

  Option Awards Stock Awards
Name   Number of
Securities
Underlying
Unexercised
Options
Exercisable
(#)		   Number of
Securities
Underlying
Unexercised
Options
Unexercisable
(#)(1)		   Option
Exercise
Price
($)		   Option
Grant
Date		   Option
Expiration
Date		   Number of
Shares or
Units of
Stock That
Have
Not Vested
(#)(2)		   Market
Value of
Shares or
Units of
Stock That
Have
Not Vested
($)(3)		   Equity
Incentive
Plan
Awards:
Number of
Unearned
Shares,
Units or
Other
Rights
That
Have Not
Vested
(#)(4)		   Equity
 Incentive
 Plan
 Awards:
 Market or
 Payout
 Value of
 Unearned
 Shares,
 Units or
 Other
 Rights That
 Have Not
Vested
($)(3)
Carol Tomé 20,252 81,009 99.28 6/1/2020 6/1/2030        
  — 47,619 165.66 2/10/2021 2/10/2031        
            25,244 5,410,855 154,795 33,178,760
Brian Newman 6,077 24,309 105.54 2/12/2020 2/12/2030        
  — 15,805 165.66 2/10/2021 2/10/2031        
            5,244 1,124,068 71,496 15,324,453
Scott Price(5) 11,811 7,875 106.43 3/1/2018 3/1/2028        
  7,541 11,312 111.80 2/14/2019 2/14/2029        
  5,335 21,344 105.54 2/12/2020 2/12/2030        
  — 13,876 165.66 2/10/2021 2/10/2031        
            11,681 2,503,647 51,359 11,008,288
Nando Cesarone 573 — 98.77 3/2/2016 3/2/2026        
  735 735 106.87 3/1/2017 3/1/2027        
  757 1,513 106.43 3/1/2018 3/1/2028        
  632 1,266 104.45 3/22/2018 3/22/2028        
  1,691 5,075 111.80 2/14/2019 2/14/2029        
  2,741 10,968 105.54 2/12/2020 2/12/2030        
  — 13,269 165.66 2/10/2021 2/10/2031        
            30,289 6,492,117 45,817 9,820,416
Kate Gutmann 2,726 — 96.98 3/4/2014 3/4/2024        
  6,974 — 101.93 3/2/2015 3/2/2025        
  7,603 — 98.77 3/2/2016 3/2/2026        
  8,158 2,040 106.87 3/1/2017 3/1/2027        
  6,049 4,034 106.43 3/1/2018 3/1/2028        
  3,881 5,823 111.80 2/14/2019 2/14/2029        
  3,012 12,052 105.54 2/12/2020 2/12/2030        
  — 9,129 165.66 2/10/2021 2/10/2031        
  — 6,657 163.25 3/25/2021 3/25/2031        
            34,523 7,399,723 39,809 8,532,661
(1)Stock options vest over a five-year period with 20% of the option vesting at each anniversary date of the grant. All options expire ten years from the date of grant. Under the terms of our 2009 Plan, 2012 Plan, 2015 Plan and 2018 Plan,equity incentive plans, unvested stock options become fully vested on the retirement date of termination due to retirement for the NEOs if they meet certain service requirements. Kevin Warren was not eligible to participate in the 2018 Stock Option program because he was not employed when the awards were made.
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(2)Unvested stock awards in this column include RPUs granted as part of the MIP in 2014, 2015, 2016, 2017 and 2018 that vest over a five-year period with approximately 20% of the award vesting on January 15 of each year. The RPUs granted as part of the MIP in 2021 vest one year after the grant date. Also includes the special grants of RSUs to Nando Cesarone and Kate Gutmann on May 13, 2020, which vest as follows: 25% on May 13, 2021, 25% on May 13, 2022 and 50% on May 13, 2023, provided they remain an employee of UPS through the applicable vesting date; and the special grant of RSUs to Kate Gutmann on March 25, 2021 which vest as follows: 25% on March 25, 2022; 25% on March 25, 2023; and 50% on March 25, 2024, provided she remains an employee through the applicable vesting dates. Values are rounded to the closest unit. Also includes the one-time RSUs granted to Scott Price on January 5, 2018 and to Kevin Warren on August 8, 2018 that have not vested.
(3)Market value based on NYSE closing price of the class B common stock on December 31, 20182021 of $97.53.
$214.34.
(4)Represents the potential units to be earned under the 20172020 and 2021 LTIP award (for the three-year performance period ending 12/31/2019), the 2018 LTIP award (for the three-year performance period ending 12/31/2020),awards, and any dividend equivalent units allocated since the grants were made. Assumesmade, at target performance goalslevel. For the 2021 LTIP RPU award, which has a performance period ending December 31, 2023, the maximum number of RPUs that could be earned is as follows: Tomé —129,963; Newman — 56,188; Price — 40,363; Cesarone — 38,597; and Gutmann — 34,419. For the 2020 LTIP RPU award, which has a performance period ending December 31, 2022, the maximum number of RPUs that could be earned is as follows: Tomé —210,586; Newman —101,103; Price — 72,626; Cesarone — 62,201; and Gutmann — 53,161.
(5)As discussed above, pursuant to the Price Separation Agreement, Scott’s equity awards are treated as follows in connection with his retirement on March 31, 2022: (a) RPUs granted in 2022 with respect to the 2021 MIP will be met for all performance periods. Kevin Warren was notvest in full immediately following March 31, 2022; (b) each RPU award granted under the LTIP will remain eligible to participate invest on a pro-rata basis, subject to actual performance for the 2018 LTIP program because he was not employed whenfull applicable performance period; and (c) his outstanding stock options (to the awards were made.extent vested) will remain exercisable for 90 days following March 31, 2022.

46      Notice of Annual Meeting of Shareowners and 2019 Proxy Statement

Table of Contents

2021 Option Exercises and Stock Vested

The following table sets forth the subject number of shares and corresponding value realized during 2018 with respect to2021 regarding options that were exercised, and restricted stock units and restricted performance units that vested, for each Named Executive Officer.NEO.

Option AwardsStock Awards
Name     Number of
Shares
Acquired
on Exercise
(#)		     Value Realized
on Exercise
($)		     Number of
Shares
Acquired
on Vesting
(#)(1)		     Value
Realized
on Vesting
($)(2)
David P. Abney——82,1178,295,495
Richard N. Peretz——24,2192,451,273
James J. Barber, Jr.——25,7552,631,934
Scott A. Price——6,269840,610
Kevin M. Warren————

  Option Awards Stock Awards
Name     Number of
Shares
Acquired
on Exercise
(#)		     Value
Realized
on Exercise
($)		     Number of
Shares
Acquired
on Vesting
(#)(1)		     Value
Realized
on Vesting
($)(2)
Carol Tomé — — — —
Brian Newman — — — —
Scott Price — — 37,490 7,523,733
Nando Cesarone — — 28,028 5,849,533
Kate Gutmann — — 32,042 6,622,286
(1)

The value in this column representsConsists of: the 20162020 MIP RPUs that vested on February 12, 2021; the 2019 LTIP award granted in the form of RPUs that vested on December 31, 2018;2021; approximately 20% of the 2017 and 2018 MIP RPUs granted in each of 2013, 2014, 2015, 2016 and 2017 that vested on January 15, 2018;2021; and athe portion of the one-time RSUs awarded in prior years to Scott Price.Price, Nando Cesarone and Kate Gutmann that vested in 2021. Vested RPU awardsRPUs and RSUs are distributed to participants in an equivalent number of shares of class A common stock.

(2)

The value shown is basedBased on the NYSE closing prices on December 31, 2018, the date the RPUs granted under the 2016 LTIP award vested, of $97.53 per share; and January 15, 2018, the date the RPUs granted under MIP vested and the date a portionprice of the one-time RSUs granted to Scott Price vested,class B common stock on the applicable vesting date.

48      Notice of $134.09 per share. If the vesting date is not a NYSE trading day, the prior trading day’s closing price is used.

Annual Meeting of Shareowners and 2022 Proxy Statement

Table of Contents

Executive Compensation

2021 Pension Benefits

The following table quantifies the pension benefits expected to be paid to each of the Named Executive OfficersNEO from the UPS Retirement Plan and the UPS Excess Coordinating Benefit Plan as of December 31, 2018.2021. The terms of each are described below.

Name     Plan Name     Number of
Years
Credited
Service(#)(2)		     Present
Value of
Accumulated
Benefit($)(3)		     Payments
During
Last
Fiscal
Year($)
David P. AbneyUPS Retirement Plan44.82,215,343—
UPS Excess Coordinating Benefit Plan—11,019,900—
Total—13,235,243—
Richard N. PeretzUPS Retirement Plan37.61,744,507—
UPS Excess Coordinating Benefit Plan—2,487,152—
Total—4,231,659—
James J. Barber, Jr.UPS Retirement Plan34.41,725,850—
UPS Excess Coordinating Benefit Plan—3,435,717—
Total—5,161,567—
Scott A. Price(1)UPS Retirement Plan———
UPS Excess Coordinating Benefit Plan———
Total———
Kevin M. Warren(1)UPS Retirement Plan———
UPS Excess Coordinating Benefit Plan———
Total———

Name Plan Name Number of
Years
Credited
Service
(#)(2)		 Present
Value of
Accumulated
Benefit
($)(3)		 Payments
During
Last
Fiscal
Year
($)
Carol Tomé(1) UPS Retirement Plan —  — —
  UPS Excess Coordinating Benefit Plan —  — —
  Total —  — —
Brian Newman(1) UPS Retirement Plan —  — —
  UPS Excess Coordinating Benefit Plan —  — —
  Total —  — —
Scott Price(1) UPS Retirement Plan —  — —
  UPS Excess Coordinating Benefit Plan —  — —
  Total —  — —
Nando Cesarone(1) UPS Retirement Plan —  — —
  UPS Excess Coordinating Benefit Plan —  — —
  Total —  — —
Kate Gutmann UPS Retirement Plan 32.0  1,802,363 —
  UPS Excess Coordinating Benefit Plan —  — —
  Total —  1,802,363 —
(1)

Scott Price and Kevin Warren are notNot eligible to participate in the UPS Retirement Plan or the UPS Excess Coordinating Benefit Plan.

(2)

This column representsRepresents years of service as of December 31, 20182021 for all plans.

(3)

This column representsRepresents the total discounted value of the monthly lifetime benefit earned at December 31, 2018,2021, assuming the executiveindividual continues in service and retires at age 60 or at the executive’s actual age, if later. The present value is not the monthly or annual lifetime benefit that would be paid to the executive.Theindividual. The present values are based on discount rates of 4.48%3.05% and 4.60%3.38% for the UPS Retirement Plan and UPS Excess Coordinating Benefit Plan, respectively, at December 31, 2018.2021. The present values assume no pre-retirement mortality and utilize the RP 2014Pri-2012 healthy mortality table with adjusted mortality improvement after 20072012 (no collar for the UPS Retirement Plan and white collar for the UPS Excess Coordinating Benefit Plan), with mortality improvements after 20072012 using the MP-2018MP-2021 projection scale adjusted to converge to 0.5% in 20232026 on the RPECSOA Retirement Plan’s Experience Committee (RPEC) model.


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   47

Pension Benefits


Table of Contents

Pension Benefits

The UPS Retirement Plan is noncontributorynon-contributory and includes substantially all eligible employees of participating domestic subsidiaries who are not members of a collective bargaining unit, as well as certain employees covered by a collective bargaining agreement. The UPS Retirement Plan was closed to new entrants as of July 1, 2016.

UPS also sponsors a non-qualified defined benefit plan, the UPS Excess Coordinating Benefit Plan, for non-union employees whose pay and benefits in the qualified plan are limited by the Internal Revenue Service. An employee must be at least age 55 with 10 years of service to be eligible to participate in this plan. In the year that an individual first becomes eligible to participate in the UPS Excess Coordinating Benefit Plan, there is an increase for the participant for that year equal to the full present value of the participant’s accrued benefit in the plan. In accordance with the terms of the Excess Coordinating Benefit Plan, following a participant’s retirement, the Company pays an amount equal to the Social Security and Medicare taxes due on the present value of the benefits provided under the plan.

The Compensation Committee believes that the retirement, deferred compensation and/or savings plans offered at UPS are important for the long-term economic well-being of our employees, and are important elements of attracting and retaining the key talent necessary to compete. The UPS Retirement Plan and UPS Excess Coordinating Benefit Plan provide monthly lifetime benefits to participants and their eligible beneficiaries based on final average compensation at retirement, service with UPS and age at retirement. Participants may choose to receive a reduced benefit payable in an optional form of an annuity that is equivalent to the single lifetime benefit.

The plans provide monthly benefits based on the greatest resultresults from up to four benefit formulas. Participants receive the largest benefit from among the applicable benefit formulas. For James Barber,Kate Gutmann the formula that results in the largest benefit is called the “grandfathered integrated formula.” This formula provides retirement income equal to 58.33% of final average average.

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Table of Contents

compensation, offset by a portion of the Social Security benefit.

A participant with less than 35 years of benefit service receives a proportionately lesser amount. For David Abney and Richard Peretz, the formula that results in the largest benefit is called the “integrated account formula.” This formula provides retirement income equal to 1.2% of final average compensation plus 0.4% of final average compensation in excess of the Social Security Wage Base times years of benefit service.amount

Participants earn benefit service for the time they work as an eligible UPS employee. For purposes of the formulas, compensation includes salary and an eligible portion of the MIP award. The average final compensation for each participant in the plans is the average covered compensation of the participant during the five highest consecutive years out of the last ten full calendar years of service.

Benefits payable under the UPS Retirement Plan are subject to the maximum compensation limits and the annual benefit limits for a tax-qualified defined benefit plan as prescribed and adjusted from time to time by the Internal Revenue Service. Eligible amounts exceeding these limits will be paid from the UPS Excess Coordinating Benefit Plan. Under this plan, participants receive the benefit in the form of a life annuity.

The plans permit participants with 25 or more years of benefit service to retire as early as age 55 with only a limited reduction in the amount of their monthly benefits. Each of the Named Executive Officers would beNEOs eligible to retire at age 60 and receive unreduced benefits from the plans. In addition, the plans allow participants with ten years or more of service to retire at age 55 with a larger reduction in the amount of their benefit. As of December 31, 2018, Richard Peretz and James Barber were eligible for early retirement with reduced benefits. If they had retired on December 31, 2018, their benefits would be reduced by 9% (Peretz) and 4.5% (Barber). David Abney is currently eligible for early retirement with unreduced benefits.


2021 Non-Qualified Deferred Compensation

The following table shows the executive and Company contributions or credits, earnings and account balances for the Named Executive OfficersNEOs in the UPS Deferred Compensation Plan and UPS Restoration Savings Plan for 2018.2021.

Name     Executive
Contributions
in Last FY
($)(1)		     Registrant
Contributions
in Last FY
($)		     Aggregate
Earnings
in Last FY
($)		     Aggregate
Withdrawals/
Distributions
($)		     Aggregate
Balance at
Last FYE
($)(2)
David P. Abney——(475,426)—2,538,119
Richard N. Peretz——(166,126)—727,421
James J. Barber, Jr.4,684—(101,000)—547,411
Scott A. Price—————
Kevin M. Warren—————

Name Plan Name Executive
Contributions
in Last FY
($)(1)		 Registrant
Contributions
in Last FY
($)(2)		 Aggregate
Earnings
in Last FY
($)(3)		 Aggregate
Withdrawals/
Distributions
($)		 Aggregate
Balance at
Last FYE ($)(4)
Carol Tomé UPS Deferred Compensation Plan 467,688 — 398,667 — 4,439,559
  UPS Restoration Savings Plan — 32,738 2,984 — 35,721
Brian Newman    UPS Restoration Savings Plan     —     11,024     1,096     —     12,120
Scott Price UPS Restoration Savings Plan — 37,193 18,568 — 111,805
Nando Cesarone UPS Restoration Savings Plan — 43,167 6,019 — 49,187
Kate Gutmann UPS Deferred Compensation Plan — — 124,059 — 561,890
(1)

Executive contributions represent deferralAmounts are also disclosed in the “Salary” column of base salary,the 2021 Summary Compensation Table.

(2)Company credits to the UPS Restoration Savings Plan, which amounts are also disclosed in the salary“All Other Compensation” column of the 2021 Summary Compensation Table.

(3)No amounts in this column are reported in the 2021 Summary Compensation Table.
(2)(4)

Certain amounts in this column represent salary, bonus or stock options contributed by the Named Executive OfficerNEO to the planplans in prior years as follows: AbneyTomé — $1,122,199; Peretz — $339,973; Barber — $295,735;$1,883,750; Newman – $0; Price — $0 Cesarone — $0; Warrenand Gutmann — $0.

$118,149.

The deferred compensation vehicles in the UPS Deferred Compensation Plan and the UPS Restoration Savings Plan are described below. Not all of the Named Executive OfficersNEOs participate in each feature of the UPS Deferred Compensation Plan.

48      Notice of Annual Meeting of Shareowners and 2019 Proxy Statement

Table of ContentsSalary Deferral Feature

Salary Deferral Feature

●

Prior to December 31, 2004, contributions could be deferred from executive officers’ monthly salary and from their half-month bonus.

 
●

Prior to December 31, 2004, non-employee directors could defer retainer and meeting fees quarterly. Assets from the discontinued UPS Retirement Plan for Outside Directors were transferred to the 2004 and Before Salary Deferral Feature in 2003.

●

No contributions were permitted after December 31, 2004, except as described below.

 
●

After December 31, 2004, executive officers may defer 1% to 35% of their monthly salary and 1% to 100% of the cash portion of the MIP award. They may also defer excess pre-tax contributions if the UPS 401(k) Savings Plan fails the annual average deferral percentage test.

 
●

Non-employee directors may defer retainer fees quarterly.

 
●

Elections are made annually for the following calendar year.



Stock Option Deferral Feature50      Notice of Annual Meeting of Shareowners and 2022 Proxy Statement

Table of Contents

Executive Compensation

Stock Option Deferral Feature

●

Assets are invested solely in shares of UPS stock.

 
●

Non-qualified or Incentive Stock Optionsincentive stock options which vested prior to December 31, 2004 were deferrable during the annual enrollment period for the following calendar year.  Participants deferred receipt of UPS stock that would otherwise be taxable upon the exercise of the stock option.

 
●

The shares received upon exercise of these options are deferred into a rabbi trust. The shares held in this trust are classified as treasury stock, and the liability to participating employees is classified as “deferred compensation obligations” in the shareowners’ equity section of the balance sheet.

●

No deferrals of stock options were permitted after December 31, 2004.

 
●

As a result of the requirements applicable to non-qualified deferred compensation arrangements under Section 409A of the Internal Revenue Code and related guidance, deferral of stock options is no longer offered under the UPS Deferred Compensation Plan for options that vested after December 31, 2004.



Withdrawals and Distributions under the UPS Deferred Compensation Plan

Withdrawals and Distributions under the UPS Deferred Compensation Plan

●

For the 2004 and Before Salary Deferral Feature, participants may elect to receive the funds in a lump sum or up to a 10 year10-year installment (of 120 monthly payments), subject to restrictions if the balance is less than $20,000.

 
●

For the 2005 and Beyond Salary Deferral Feature, participants may elect to receive funds in a lump sum or up to a 10 year installment (120 monthly payments), subject to restrictions if the balance, plus the total balance in any other account which must be aggregated with the 2005 and Beyond Salary Deferral Account under Section 409A of the Internal Revenue Code, is less than the Internal Revenue Code Section 402(g) annual limit in effect for qualified 401(k) plans on the date the participant becomes eligible for a distribution.

 
●

For the Stock Option Deferral Feature, participants may elect to receive shares in a lump sum or up to 10 annual installments, subject to restrictions if the balance is less than $20,000. The distribution of shares will occur pro-rata based on the type of stock options (non-qualified or Incentive)incentive) that were originally deferred.

 
●

The distribution election under the 2005 and Beyond Salary Deferral Feature may be changed one time only, but may be changed more frequently under the 2004 and Before Salary Deferral Feature and the Stock Option Deferral Feature.

●

Hardship distributions are permitted under all three features of the UPS Deferred Compensation Plan.

 
●

Withdrawals are not permitted under the 2005 and Beyond Salary Deferral Feature, but withdrawals are permitted for 100% of the account under the 2004 and Before Salary Deferral Feature and Stock Option Deferral Feature. However, withdrawals will result in a forfeiture of 10% of the participant’s total account balances.

No Company contributions are made to any of the three features of the UPS Deferred Compensation Plan. The aggregate balances shown in the table above represent amounts that the Named Executive OfficersNEOs have earned but elected to defer, plus earnings (or less losses). There are no above-market or preferential earnings in the UPS Deferred Compensation Plan. The investment options mirror those in the UPS 401(k) Savings Plan. Dividends earned on shares of UPS stock in the UPS Deferred Compensation Plan are earned at the same rate as all other class A and class B shares of common stock. Dividends are added to the participant’s deferred compensation balance. Deferral elections made under the UPS Deferred Compensation Plan are irrevocable once made.


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UPS Restoration Savings Plan


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UPS Restoration Savings Plan

Benefits payable under the UPS 401(k) Savings Plan are subject to the maximum compensation limits and the annual benefit limits for a tax-qualified defined contribution plan as established by the Internal Revenue Service. Amounts exceeding these limits are paid pursuant to the UPS Restoration Savings Plan, which is a non-qualified restoration plan designed to replace the amount

of benefits limited under the tax-qualified plan. Without the UPS Restoration Savings Plan, executive officers would receive a lower benefit as a percent of eligible compensation than the benefit received by other participants in the UPS Savings Plan. No NEOs have received any UPS Restoration Savings Plan payments as

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Table of December 31, 2018.Contents


Potential Payments on Termination or Change in Control

We have not entered into any employment agreements with our executive officers that provide continuation of employment of an executive. Our Compensation Committee believes that UPS has created a culture where long tenure for executives is the norm. As a result, executive officers serve without employment contracts, as do most of our other U.S.-based non-union employees.

In connection with Carol Tomé’s hiring, we entered into a protective covenant agreement with her which protects UPS’s confidential information and includes non-competition and non-solicitation covenants in favor of UPS. If she is terminated without “cause” prior to June 1, 2022, then she is entitled to continued payment of her base salary for up to 24 months. If her employment is terminated without “cause” after June 1, 2022, then the Company is obligated to make such payments only if it elects to enforce the post-termination covenants.

In connection with the hiring of each of Brian Newman and Scott Price, and Kevin Warren, we entered into similar protective covenant agreements with each of them which,them. At December 31, 2021, these agreements also provided for the payment of two years’ base salary if they are terminated without cause, and the Company elects to enforce the post-termination covenants. Subsequent to December 31, 2021, we entered into a new agreement with Scott, described below.

We have also entered into retention arrangements and similar protective covenant agreements with Nando Cesarone and Kate Gutmann that provide for the continued vesting of their 2020 special RSU retention grants in the event they are terminated without cause during the first two years of employment, provideor resign for (i) separation pay equal to two years’ salary, (ii) continued vesting of their one-time RSU grants, and (iii) with respect to Kevin Warren, the payment of any unpaid transition payments (see “2018 Employment Transition Payments” described above)“good reason”. In the event either of them are terminated without cause after the first two years of employment, the Company is obligated to make such payments and continue vesting such grants if it elects to enforce post-termination non-compete covenants connected to those agreements. Furthermore, under the terms of their offer letters, each is entitled to continue to vest in the one-time RSU awards granted to them in 2018 in the event either of them are terminated without cause. Termination for cause will result in the loss of these payments.

TheOur equity awards granted between May 7, 2009 and May 2, 2012 were made pursuant to the 2009 Plan; equity awards granted on or after May 3, 2012 were made pursuant to the 2012 Plan; equity awards granted on or after May 7, 2015 were made pursuant to the 2015 Plan; and equity awards granted on or after January 1, 2018 were made pursuant to the 2018 Plan. Theincentive plans and the related award certificatesdocuments contain provisions that affect outstanding awards to all plan participants, including the NEOs, in the event of a participant’s death, disability or retirement, or a change in control (as defined below) of the Company and a participant’s retirement, death or disability. Company.

Upon a participant’s retirement, death, disability or disability:retirement:

●

Options will become immediately exercisable;

vest, and remain exercisable until the tenth anniversary of the date of grant;
●

Restrictions imposed on sharesShares of restricted stock, RSUs or RPUs that are not performance-based lapse;no longer subject to performance conditions will immediately vest. In the case of a participant’s death, shares (or cash, as applicable) attributable to the number of restricted shares, RSUs or RPUs will be transferred to the participant’s estate within 90 days. In the case of a participant’s disability or retirement, shares (or cash, as applicable) attributable to the number of restricted shares, RSUs or RPUs will be transferred to the participant on the same schedule as if they had remained employed; and

 
●

Target payout opportunities attainable under all outstanding awardsShares of performance-based restricted stock, RSUs and RPUs that are still subject to performance conditions shall be deemed to have been fully earned on a prorated basis for the applicablenumber of months worked during the performance periods. Paymentperiod. In the case of an award (ina participant’s death, shares (or cash, or stock, as applicable) is madeattributable to the prorated number of restricted shares, RSUs or RPUs calculated at target performance level will be transferred to the participant’s estate within 90 days. In the case of a participant’s disability or retirement, shares (or cash, as applicable) attributable to the prorated number of restricted shares, RSUs or RPUs calculated based on actual performance results for the full performance period will be transferred to the participant based upon an assumed achievement of all relevant targeted performance goals andfollowing the length of time within the applicable performance period which has elapsed.

In the event of a change in control, if the successor company continues, assumes or substitutes other grants for outstanding awards, and within two years following the change in control the participant is terminated by the successor without cause or the participant resigns for good reason, then:

●

Options will become immediately exercisable as of the termination or resignation;

●

Restrictions imposed on restricted stock or RSUs that are not performance-based will lapse; and

●

Performance-based awards will vest with respect to each performance measurement tranche completed during the performance period prior to the termination or resignation (or, if the performance period is not divided into separate performance measurement tranches, proportionately based on the portionend of the performance period completed prior to such resignation or termination).

period.

In the event ofUpon a change in control, if the successor company does not continue, assume or substitute other grants for outstanding awards, or in the case ofupon a dissolution or liquidation of UPS, then options will be fully vested and exercisable and the Compensation Committee will either give a participant a reasonable opportunity to exercise the option before the transaction resulting in the change in control followed by a termination of the grantee’s employment by UPS without cause or payby the participant the difference between the exercise pricegrantee for the option and the consideration provided to other similarly situated shareowners.good reason:


Other Outstanding Awards●Options will immediately vest and become exercisable;
●Shares of restricted stock, RSUs or RPUs that are no longer subject to performance conditions will immediately vest; and
●Shares of restricted stock, RSUs and RPUs that are still subject to performance conditions will be deemed earned to the extent that actual achievement of the applicable performance conditions can be determined, or on a prorated basis for the portion of the performance period completed prior to the change in control or qualifying termination, based on target or actual performance.

Other Outstanding Awards; No Tax Gross-Ups

Any other awards which may be outstanding awards willwould vest and be paid generally as described in the bullet points above (except, where applicable, timing of payment generally will be tied to such change in control, rather than termination or resignation). Our 1999 Incentive Compensation plan provided for tax gross-ups upon a change in

control in certain situations. However, all awards made under the 1999 Plan have already vested and are not subject to the change in control provisions. The 2018 Plan, 2015 Plan, 2012 Plan and 2009 PlanWe do not provide for the payment of tax gross-ups.gross-ups on outstanding awards.


5052      Notice of Annual Meeting of Shareowners and 20192022 Proxy Statement

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Executive Compensation

The following table shows the potential payments to the NEOs upon a termination of employment under various circumstances. In preparing the table, we assumed the event occurred on December 31, 2018.2021. The closing price per share of our class B common stock on the NYSE on December 31, 20182021 was $97.53.$214.34. The actual amounts to be paid under any of the scenarios can only be determined at the time of such NEO’s separation from the Company.

Name     Separation Pay(1)
($)		     Accelerated
Vesting of
Equity
Awards(2)
($)		     Benefits(3)
($)		     Total
($)
David P. Abney
Termination (voluntary or involuntary for cause)————
Termination (involuntary without cause)————
Change in Control (with termination)—18,778,760—18,778,760
Retirement—18,778,760—18,778,760
Death—18,778,760—18,778,760
Disability—18,778,760—18,778,760
Richard N. Peretz
Termination (voluntary or involuntary for cause)————
Termination (involuntary without cause)————
Change in Control (with termination)—5,484,329—5,484,329
Retirement—5,484,329280,0685,764,397
Death—5,484,329—5,484,329
Disability—5,484,329—5,484,329
James J. Barber, Jr.
Termination (voluntary or involuntary for cause)————
Termination (involuntary without cause)————
Change in Control (with termination)—7,360,835—7,360,835
Retirement—7,360,835224,4457,585,280
Death—7,360,835—7,360,835
Disability—7,360,835—7,360,835
Scott A. Price
Termination (voluntary or involuntary for cause)————
Termination (involuntary without cause)1,236,0002,524,565—3,760,565
Change in Control (with termination)—4,944,802—4,944,802
Retirement—4,944,802—4,944,802
Death—4,944,802—4,944,802
Disability—4,944,802—4,944,802
Kevin M. Warren
Termination (voluntary or involuntary for cause)————
Termination (involuntary without cause)2,700,0002,465,138—5,165,138
Change in Control (with termination)—2,465,138—2,465,138
Retirement—2,465,138—2,465,138
Death—2,465,138—2,465,138
Disability—2,465,138—2,465,138

In accordance with applicable SEC requirements, we disclose in this table the potential payments and benefits that Scott Price would have received in connection with the indicated events if they had occurred on December 31, 2021. However, we also disclose below the table the actual payments and benefits to which Scott is or will be entitled under the Price Separation Agreement.

Name Separation
Pay(1)
($)		     Accelerated
Vesting of Equity
Awards(2)
($)		     Total
($)
Carol Tomé      
Termination (voluntary or involuntary for cause) — — —
Termination (involuntary without cause) 2,730,000 — 2,730,000
Change in Control (with qualifying termination) — 50,228,603 50,228,603
Retirement — 50,228,603 50,228,603
Death — 50,228,603 50,228,603
Disability — 50,228,603 50,228,603
Brian Newman      
Termination (voluntary or involuntary for cause) — — —
Termination (involuntary without cause) 3,030,864 — 3,030,864
Change in Control (with qualifying termination) — 19,862,728 19,862,728
Retirement — 19,862,728 19,862,728
Death 1,500,000 19,862,728 21,362,728
Disability 1,500,000 19,862,728 21,362,728
Scott Price      
Termination (voluntary or involuntary for cause) — — —
Termination (involuntary without cause) 1,376,832 1,516,639 2,893,471
Change in Control (with qualifying termination) — 18,519,370 18,519,370
Retirement — 17,002,731 17,002,731
Death — 18,519,370 18,519,370
Disability — 17,002,731 17,002,731
Nando Cesarone      
Termination (voluntary or involuntary for cause) — — —
Termination (involuntary without cause) — 5,548,241 5,548,241
Change in Control (with qualifying termination) — 19,053,555 19,053,555
Retirement — 13,505,315 13,505,315
Death — 19,053,555 19,053,555
Disability — 13,505,315 13,505,315
Kate Gutmann      
Termination (voluntary or involuntary for cause) — — —
Termination (involuntary without cause) — 5,781,494 5,781,494
Change in Control (with qualifying termination) — 19,279,786 19,279,786
Retirement — 13,498,292 13,498,292
Death — 19,279,786 19,279,786
Disability — 13,498,292 13,498,292
(1)

Represents the valueFor Brian Newman, includes payment of his performance-based cash award (see “Employment Transition Awards, Retention Arrangements and Recognition Awards” above). The final portion of this award was paid in March 2022. For Brian Newman and Scott Price, separation pay and with respectconsisting of 24 month’s base salary, would only be payable if the Company elects to Kevin Warren,enforce the payment of any unpaid transition payments (see 2018 “Employment Transition Payments” described above).

post-termination non-compete covenants.
(2)

Represents the value of accelerated vesting of stock options and RPUs in accordance with the terms of the 2009 Plan, the 2012 Plan, the 2015 Plan, the 2018 Planour equity incentive plans and the applicable award certificates. Also includes the 20172020 and 20182021 LTIP awards calculated at target. The performance measurement period for the 20172020 LTIP award ends December 31, 2019,2022, and performance measurement period for the 20182021 LTIP award ends December 31, 2020.2023. With respect to Kevin WarrenScott Price, Nando Cesarone, and Scott Price,Kate Gutmann, includes the continued vesting of the one-time grant of RSUs awardedRSU awards to each as described in the “2018 Employment“Employment Transition Payments” sectionAwards, Retention Arrangements and Recognition Awards” above.

  
(3)

Represents   53

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Separation Arrangement with Scott Price

The Company has entered into the Price Separation Agreement, pursuant to which Scott Price is retiring from the Company on March 31, 2022, and under which the Company will provide certain severance compensation and benefits to Scott in lieu of any benefits under Scott’s protective covenant agreement. The Price Separation Agreement provides that Scott will receive, in addition to certain accrued compensation and benefits, a lump sum cash severance payment equal to $912,151.20, representing (A) one-year of base salary and (B) a pro-rata portion of Scott’s target award under the 2022 MIP. In addition, Scott’s equity awards outstanding as of the separation date will be treated as follows:

(1)4,089 RPUs granted to Scott in 2022 with respect to the actuarial present value of2021 MIP will vest in full immediately following the incremental non-qualified amounts payable upon change in control, early retirement death and disability fromdate;
(2)each RPU award granted under the UPS Excess Coordinating Benefit Plan. For information about the UPS Excess Coordinating Benefit Plan, see the Pension Benefits table and related narrative. The same assumptions were usedLTIP will remain eligible to calculate the present value of the amounts in this table that were usedvest on a pro-rata basis, subject to actual performance for the Pension Benefits table except that benefits are assumedfull applicable performance period. Such pro-rata target opportunities consist of 24,759 RPUs with respect to be payable immediately as of December 31, 2018 (or age 55 if later) instead of as of age 60. Only individuals eligiblethe 2020 LTIP award, and 7,645 RPUs with respect to the 2021 LTIP award ; and
(3)Scott’s outstanding stock options (to the extent vested) will remain exercisable for early retirement (55 with 10 years of service) who are not yet age 60 will have an early retirement value in90 days following the table.

separation date.

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TableThe estimated aggregate value of Contentsthe accelerated or continued vesting of equity awards described above is approximately $7,502,231 based on the closing price of the class B common stock on March 1, 2022 and assumes that the LTIP RPU awards will be earned at the target level.

Other Amounts

The Price Separation Agreement includes certain customary protective covenants in favor of the Company, including confidentiality, employee and customer non-solicitation, non-competition, and non-disparagement provisions.

Other Amounts

The previous table does not include payments and benefits to the extent they are generally provided on a non-discriminatory basis to salaried employees not subject to a collective bargaining agreement upon termination of employment. These include:

●Life insurance upon death in the amount of 12 times the employee’s monthly base salary, with a December 31, 20182021 maximum benefit payable of $1 million;
●A death benefit in the amount of three times the employee’s monthly salary;
●Disability benefits; and
●Accrued vacation amounts.

The tables also do not include amounts to which the executives would be entitled to receive that are already described in the compensation tables that appear earlier in this proxy statement,Proxy Statement, including:

●The value of equity awards that are already vested;
●Amounts payable under defined benefit pension plans; and
●Amounts previously deferred into the deferred compensation plan.


Definition of a Change in Control

Definition of a Change in Control

A change in control of the Company as defined in the 2018 Planour equity incentive compensation plans is generally deemed to have occurred as of the first day that any one or more of the following conditions shall have been satisfied:

●The consummation of a reorganization, merger, share exchange or consolidation, in each case, where persons who were shareowners of UPS immediately prior to such reorganization, merger, share exchange or consolidation do not, immediately thereafter, own more than fifty percent (50%) of the combined voting power of the reorganized, merged, surviving or consolidated company’s then outstanding securities entitled to vote generally in the election of directors in substantially the same proportions as immediately prior to the transaction; or a liquidation or dissolution of UPS or the sale of substantially all of UPS’s assets; or
●Individuals who, as of any date (the “Beginning Date”), constitute the Board of Directors (the “Incumbent Board”) and who, as of the end of the two-year period beginning on such Beginning Date, cease for any reason to constitute at least a majority of the Board of Directors, provided that any person becoming a director subsequent to the Beginning Date whose election, or nomination for election by UPS’s shareowners, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board (other than an election or nomination of an individual whose initial assumption of office is in connection with an actual or threatened election contest relating to the election of the directors of UPS, as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act)applicable SEC rules and requirements) shall be considered as though such person were a member of the Incumbent Board.
54      Notice of Annual Meeting of Shareowners and 2022 Proxy Statement


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Executive Compensation

Equity Compensation Plans

The following table sets forth information as of December 31, 20182021 concerning shares of our common stock authorized for issuance under all of our equity compensation plans.

Plan category     Number of Securities
to be Issued Upon
Exercise of
Outstanding Options,
Warrants and Rights
(a)		     Weighted-Average
Exercise Price of
Outstanding
Options,
Warrants and Rights
(b)		     Number of Securities
Remaining Available for
Future Issuance Under
Equity Compensation Plans
(Excluding Securities
Reflected in Column
(a))
(c)		 Number of Securities
to be Issued
Upon Exercise of
Outstanding Options,
Warrants and Rights
(a)		 Weighted-Average
Exercise Price of
Outstanding Options,
Warrants and Rights
(b)		 Number of Securities
Remaining Available for Future
Issuance
Under Equity Compensation
Plans (Excluding Securities
Reflected in Column (a))
(c)		 
Equity compensation plans approved by security holders(1)16,234,3198.1333,277,669(2) 10,644,164 17.01 29,926,374(2) 
Equity compensation plans not approved by security holders—N/A— — N/A — 
Total16,234,3198.1333,277,669 10,644,164 17.01 29,926,374 
(1)

Includes the 1999 Plan, the 2009 Plan, the 2012 Plan, the 2015 Plan, the 2018 Planall equity incentive compensation plans and the Discounted Employee Stock Purchase Plan, each of which has been approved by our shareowners. Effective with the authorizationapproval of the 20182021 Omnibus Incentive Compensation Plan that was approved by our shareowners in May 2018,2021, no additional securities may be issued under the 1999 Plan, the 2009 Plan, the 2012 Plan or the 2015 Plan.prior equity incentive compensation plans. Awards that do not entitle the holder to receive or purchase shares and awards that are settled in cash are not counted against the aggregate number of shares available for awards under the 20182021 Plan.

(2)

In addition to grants of options, warrants or rights, this number includes up to 19,592,70418,855,155 shares of common stock or other stock-based awards that may be issued under the 20182021 Plan, and up to 13,684,96511,071,219 shares of common stock that may be issued under the Discounted Employee Stock Purchase Plan. This number does not include shares under the 1999 Plan, the 2009 Plan, the 2012 Plan or the 2015 Planprior equity incentive compensation plans because no new awards may be made under those plans.


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Median Employee to CEO Pay Ratio

As required by Item 402(u) of Regulation S-K, pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act, we are providing the following ratio of the annual total compensation of our Chief Executive OfficerCEO to the annual total compensation of our median employee.

The 2021 annual total compensation of the median compensated employee was $55,417;$50,379; our CEO’s 2021 annual total compensation as required to be determined by GAAP and included in the 2021 Summary Compensation Table was $27,632,142.  As required by GAAP, the CEO’s 2021 annual total compensation included in the 2021 Summary Compensation Table includes both 100% of the target value of the 2021 LTIP award and 80% of the target value of the 2020 LTIP award. We believe a more representative CEO annual total compensation should exclude the 80% of the target value of the 2020 LTIP award, in which case our CEO’s 2021 annual total compensation was $15,219,669, and the ratio of CEO compensation to that of the median compensated employee would be 302-to-one.  Including all of the CEO’s annual total compensation was $15,072,127, and theas required by GAAP results in a ratio of these amountsCEO compensation to that of the median compensation employee of 548-to-one.

Our CEO’s 2021 annual total compensation was 272-to-1.

Itemsdifferent from the amount included in the 2021 Summary Compensation Table total column. Amounts related to healthcare benefits, which are available generally to all salaried employees of the company,Company, are included in the annual total compensation numbersamounts above. The CEO’s and median employee’s company-paidCompany-paid healthcare benefit amounts were $11,251$11,249 and $5,452$5,449 respectively. For the CEO, this amount is not included in the 2021 Summary Compensation Table or the Supplemental 2021 Summary Compensation Table, as permitted by SEC regulations.

The SEC’s rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s annual total compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. As a result, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies have different employee populations and compensation practices and may utilize different methodologies, exclusions, estimates and assumptions in calculating their own pay ratios.

The pay ratio reported above is a reasonable estimate calculated in a manner consistent with SEC rules based on our payroll and employment records and the methodology described below. As permitted by SEC rules, for our 20182021 pay ratio reported above, we used the same median employee that we used for our 20172020 pay ratio, as we believe there has been no change in our employee population or employee compensation arrangements that would significantly impact our pay ratio disclosure, including as a result of the acquisitions described below.disclosure. For these purposes, we identified the median compensated employee from our employee population as of October 1, 2017,2020, using total taxable wages (Form W-2 Box 1 or equivalent) paid to our employees in fiscal year 2017.2020. We determined our total workforce as of

October 1, 20172020 to consist of 466,707547,857 employees. During the fiscal year 2017, UPS purchased Zone Solutions, LLC and Freightex Ltd. These companies employed 14 and 133 employees respectively. Also, asAs permitted by SEC rules, under the 5% “De Minimis Exemption”,Exemption,” we excluded 22,90926,368 non-U.S. employees, or 4.9%4.8% of our total workforce. As a result of these exclusions, our median employee was identified from an employee population of 443,651521,489 employees.

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The excluded countries and their employee populations arewere as follows: Albania (1 employee), Argentina (243(242 employees), Australia (430(486 employees), Austria (190(185  employees), Bahrain (28  employees), Belarus (23  employees), Barbados (12 employees), Belarus (30 employees), Belgium (1,208 employees), Bolivia (4(1,008  employees), Brazil (772(692  employees), Chile (184(113  employees), Colombia (478(1,064  employees), Costa Rica (272(343  employees), Czech Republic (457(453  employees), Denmark (590(531  employees), Dominican Republic (135(116 employees), Ecuador (85(65 employees), Egypt (36(29  employees), El Salvador (34(30  employees), Finland (205(187 employees), Greece (138(143 employees), Guam (1 employee)(2 employees), Guatemala (82(73  employees), Honduras (48(39  employees), Hong Kong (1,117(1,013  employees), Hungary (377 employees), India (1,924(417  employees), Indonesia (182(159  employees), Ireland (857(1,133  employees), Italy (1,258(1,279 employees), Jamaica (8(4 employees), Japan (660(644 employees), Kazakhstan (39(36 employees), Kenya (1 employee), Kuwait (47(54 employees), Luxembourg (6(11 employees), Macau (24(2 employees), Malaysia (512(302 employees), Mexico (2,489  employees), Morocco (61 employees), Nepal (2(60  employees), New Zealand (27  employees), Nicaragua (25  employees), Nigeria (288  employees), Norway (105  employees), Pakistan (59 employees), Panama (32 employees), Nicaragua (43 employees), Nigeria (352 employees), Norway (107 employees), Pakistan (68 employees), Panama (39 employees), Peru (93(77 employees), Philippines (1,236(1,470  employees), Portugal (182(195  employees), Puerto Rico (475(442  employees), Romania (158(142  employees), Russia (553(571  employees), Singapore (1,108(1,219  employees), Slovakia (29(18  employees), Slovenia (48(51  employees), South Africa (326(277  employees), South Korea (510(558  employees), Spain (1,242 employees), Sri Lanka (8(1,314  employees), Sweden (991(938  employees), Switzerland (478(703  employees), Taiwan (873(970  employees), Thailand (465(473  employees), Uganda (1 employee)Turkey (1,992  employees), Ukraine (90(89  employees), United Arab Emirates (379(532  employees), Uruguay (13U.S. Virgin Islands (10 employees), Venezuela (6 employees),and Vietnam (259 employees), Virgin Islands (12(336 employees).


Proposal 2 — Advisory Vote to Approve Named Executive Officer Compensation

www.upsannualmeeting.com   

   53What am I voting on? Whether you approve, on an advisory basis, the compensation of the NEOs as disclosed in this Proxy Statement.

Board’s Recommendation: Vote FOR this proposal.

Vote Required: Approval by a majority of the voting power of the shares present in person or by proxy.


In accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) and Section 14A of the Exchange Act, shareowners may vote, on an advisory basis, to approve the 2021 compensation paid to our NEOs as disclosed in this proxy statement (“say on pay”). We currently conduct say on pay votes annually. We expect that the next say on pay vote will occur at our 2023 Annual Meeting of Shareowners.

Pay for performance and alignment with the long-term interests of our shareowners are key principles of our compensation programs. NEO compensation reflects the following:

●encouraging executive decision-making that is aligned with the long-term interests of our shareowners;
●tying a significant portion of executive pay to Company performance over a multi-year period;
●promoting UPS’s long-standing culture of owner-management; and
●balancing shorter- and longer-term performance metrics to encourage the efficient management of our business and minimizing excessive risk-taking.

Although this vote is non-binding, the Committee and the board value your views and will consider the voting results. If there is a significant negative vote, we expect that we will consult directly with significant shareowners to better understand their concerns. The Committee and the board would consider feedback obtained through this process in making future compensation decisions.

In accordance with the Dodd-Frank Act, this vote does not overrule any decisions by the board, will not create or imply any change to or any additional fiduciary duties of the board and will not restrict or limit the ability of shareowners generally to make proposals for inclusion in proxy materials related to executive compensation.

Shareowners are being asked to approve the following resolution:

“RESOLVED, that the shareowners approve, on an advisory basis, the compensation of the NEOs, as described in the Compensation Discussion and Analysis section and in the compensation tables and accompanying narrative disclosure in the Company’s Proxy Statement for the 2022 Annual Meeting of Shareowners.”

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Ownership of Our Securities

Ownership of Our Securities

Ownership of Our Securities

Securities Ownership of Certain Beneficial Owners and Management

The following table sets forth information as of December 31, 2018 as to each person known to us to be the beneficial owner of more than five percent of either our class A or class B common stock, based on SEC filings by such persons. Class A shares haveare entitled to ten votes per share and class B haveshares are entitled to one vote per share.share on each matter acted upon at the Annual Meeting. Class A shares are held by employeescurrent and retireesformer employees and are not publicly traded. As of February 25, 2019March 1, 2022 there were 163,879,494137,653,301 outstanding shares of class A common stock and 696,320,362733,368,173 outstanding shares of class B common stock.

Name and address     Number of Shares
of Class B Stock
Beneficially Owned		     Percent of
Class B Stock
BlackRock, Inc.(1)
55 East 52nd Street43,989,0616.3%
New York, NY 10055
The Vanguard Group(2)
100 Vanguard Blvd.53,522,3137.7%
Malvern, PA 19355

Name and address Number of Shares
of Class B Stock
Beneficially Owned		       Percent of
Class B Stock
BlackRock, Inc.(1)
55 East 52nd Street
New York, NY 10055		 52,091,461 7.1%
The Vanguard Group(2)
100 Vanguard Blvd.
Malvern, PA 19355		 64,571,614 8.8%
(1)

According to a Schedule 13G filed with the SEC on February 3, 2022, BlackRock, Inc. has sole voting power with respect to 45,322,087 shares and sole dispositive power with respect to 52,091,461 shares.

(2)According to a Schedule 13G/A filed with the SEC on February 8, 2019, BlackRock Inc.10, 2022, The Vanguard Group has soleshared voting power with respect to 37,963,9171,235,041 shares, of our class B common stock and sole dispositive power with respect to 43,989,06161,493,614 shares of our class B common stock.

(2)

According to a Schedule 13G/A filed with the SEC on February 11, 2019, The Vanguard Group has sole voting power with respect to 856,485 shares of our class B common stock, shared voting power with respect to 166,629 shares of our class B common stock, sole dispositive power with respect to 52,518,017 shares of our class B common stock and shared dispositive power with respect to 1,004,296 shares of our class B common stock.

3,078,000 shares.

The following table sets forth the beneficial ownership of our class A and class B common stock as of February 25, 2019March 1, 2022, by each of our Named Executive Officers,NEOs, each of our directors, and all of our directorscurrent executive officers and executive officersdirectors as a group. Ownership is calculated in accordance with SEC rules and regulations.

Number of Shares
Beneficially
Owned(1)(2)		Additional Shares in
Which the Beneficial
Owner Has or Participates
in the Voting or
Investment Power(5)		Total
Shares
Beneficially
Owned(6)
Class A Shares(3)(4)Class B Shares
Named Executive Officers                    
David P. Abney602,8251,4523,460,520(7)4,064,797
Richard N. Peretz100,58700100,587
James J. Barber, Jr.150,446750150,521
Scott A. Price52,9440052,944
Kevin M. Warren20,5230020,523
Non-Employee Directors
Rodney C. Adkins10,8330010,833
Michael J. Burns26,2130026,213
William R. Johnson22,386160022,546
Candace Kendle15,3810015,381
Ann M. Livermore48,9690048,969
Rudy H.P. Markham22,8820022,882
Franck J. Moison3,628003,628
Clark T. Randt, Jr.17,6130017,613
Christiana Smith Shi1,927001,927
John T. Stankey8,248008,248
Carol B. Tomé26,9122,936029,848
Kevin M. Warsh12,6920012,692
All executive officers and directors as a group (24)1,489,4814,6243,460,520(7)4,954,625(8)

  Number of Shares
Beneficially
Owned(1)(2)		     Total Shares
Beneficially
Owned(5)		 
  Class A Shares(3)(4)     Class B Shares 
Named Executive Officers       
Carol Tomé 184,968 13,036 198,004 
Brian Newman 44,974 — 44,974 
Scott Price 70,204 38,305 108,509 
Nando Cesarone 39,082 1 39,083 
Kate Gutmann 147,144 — 147,144 
Non-Employee Directors       
Rodney Adkins 16,543 — 16,543 
Eva Boratto 1,677 — 1,677 
Michael Burns 32,907 — 32,907 
Wayne Hewett 1,677 873 2,550 
Angela Hwang 2,017 — 2,017 
Kate Johnson 1,373 — 1,373 
William Johnson 29,757 160 29,917 
Ann Livermore 55,663 — 55,663 
Franck Moison 8,664 — 8,664 
Christiana Smith Shi 6,804 — 6,804 
Russell Stokes 1,373 400 1,773 
Kevin Warsh 18,576 — 18,576 
Current Executive Officers and Directors as a Group (24 persons) 1 ,023,059 60,444 1,083,503(6) 
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(1)Includes shares for which the named person or group has sole voting or investment power or has shared voting or investment power with his or her spouse.
(2)Includes 1,083 shares heldpledged by immediate family members as follows: Abney — 26,500; Peretz — 220; Barber — 0; Price — 0; Warren — 0; and all current executive officers and directors as a group, — 26,720. Each named individual disclaims all beneficial ownership of the shares held by immediate family members.

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(2)Includes shareswhich were pledged prior to the 2014 adoption of a policy prohibiting our executive officers and directors from entering into pledges of their UPS stock. The aggregate number of shares pledged by executive officers and directors as a group represents significantly less than 1%None of our issued and outstandingdirectors have pledged any shares of commonUPS stock. Pledged shares are as follows: Barber — 14,490; and all directors and executive officers as a group — 15,171. Shares pledged are not counted for purposes of compliance with our stock ownership guidelines. All of the executive officers that had existing pledgeshave pledged shares comply with our stock ownership guidelines after excluding the shares subject to pledge. None of our directors have pledged any shares of UPS stock.
(3)Includes class A shares that may be acquired by directorsthrough April 30, 2022 upon the conversion of RSUs following separation from the UPS Board of Directors. TheseDirectors, including 25,244 RSUs are also reportedheld by Carol Tomé in the additional ownership table below.
connection with her service as a non-employee director.
(4)Includes class A shares that may be acquired through stock options exercisable through April 25, 201930, 2022 as follows: Abney — 346,145; Peretz — 71,752; Barber — 100,599;Tomé – 148,880; Newman – 15,315; Price — 38,539; Warren — 10,983;– 36,568; Cesarone – 7,087; Gutmann – 49,239; and all current directors and executive officers as a group — 719,875.
435,196.
(5)None of the individuals listed, nor members of their immediate families, has any direct ownership rights in the shares in this column. See footnotes 7 and 8.
(6)All directors and executive officers individually and as a group held less than one percent of outstanding shares of each of class A and class B common stock outstanding as of February 25, 2019.March 1, 2022. Assumes that all options exercisable and RSUs through April 25, 201930, 2022 and owned by the named individual are exercised.exercised, and that shares acquirable under RSUs through April 30, 2022 are so acquired. The total number of shares outstanding used in calculating this percentage for each individual person also assumes that none of the options owned by other named individuals are exercised.exercised and that none of the shares acquirable under the RSUs held by other named individual are so acquired.
(7)(6)Includes 3,444,484 class A shares271 RSUs and 16,036 class B shares owned by the Annie E. Casey Foundation, Inc., which are considered under SEC rules to be beneficially owned by David Abney because he serves on the Board of Trustees.
(8)Includes shares owned by the Annie E. Casey Foundation, Inc.

Additional Ownership

OurRPUs for all current executive officers and directors and executive officers hold equity instruments that, in accordance with SEC reporting rules, are not reported in the beneficial ownership table above (with the exception of RSUs for directors) because the named persons do not have the right to acquire beneficial ownership of the underlying shares of common

stock within 60 days of February 25, 2019. These equity interests represent additional financial interests in UPS that are subject to the same market risk as ownership of our common stock. The number of shares of class A common stock to which these equity instruments are equivalent as of February 25, 2019 is as follows.


     Restricted
Stock Units(1)		     Phantom
Stock Units(2)		     Restricted
Performance
Units(3)		     Stock
Option
Deferral
Shares(4)		     Other
Deferred
Compensation
Plan Shares(5)		     Total
Named Executive Officers
David P. Abney——39,34619,571—58,917
Richard N. Peretz——12,0527,742—19,794
James J. Barber, Jr.——16,7984,466—21,264
Scott A. Price19,414————19,414
Kevin M. Warren16,851————16,851
Non-Employee Directors
Rodney C. Adkins10,833————10,833
Michael J. Burns21,365———4,85126,216
William R. Johnson22,386————22,386
Candace Kendle15,381————15,381
Ann M. Livermore21,3652,506———23,871
Rudy H.P. Markham21,365————21,365
Franck J. Moison3,628————3,628
Clark T. Randt, Jr.17,613————17,613
Christiana Smith Shi1,927————1,927
John T. Stankey8,248————8,248
Carol B. Tomé21,3651,185———22,550
Kevin M. Warsh12,692———5,50318,195

(1)

RSUs for directors are also reported in the previous table and are counted toward the total shares beneficially owned. RSUs are bookkeeping units, the value of each of which corresponds to one share of UPS class A common stock. RSUs are granted to non-employee directors on an annual basis. Dividends paid on UPS common stock are added to the director’s RSU balance. Upon termination of the individual’s service as a director, the RSUsgroup that vest and convert to class A shares.

(2)

Phantomcommon stock prior to April 30, 2022. Our directors hold vested equity instruments that, in accordance with SEC reporting rules, are not reported in the table above because the individual does not have the right to acquire beneficial ownership of the underlying shares within 60 days of March 1, 2022. These equity interests represent additional financial interests in UPS that are subject to the same market risks as ownership of our common stock. For Carol Tomé and Ann Livermore, represents 1,295 and 2,740 phantom stock units, are bookkeeping units, the value of each of which correspondsrespectively; and for Michael Burns, Wayne Hewett and Kevin Warsh, represents deferred non-employee director retainer fees allocated to one share5,302, 704 and 8,434 shares of UPS class B common stock.stock, respectively, within the UPS Deferred Compensation Plan. Phantom stock units were granted to non-employee directors pursuant to a deferred compensation program previously provided to non-employee directors. Carol’s phantom stock units were awarded during her service as a non-employee director. Dividends paid on UPS common stock are addedcredited to the director’s phantom stock unit balance. Upon termination of the individual’s service as a director, amounts represented by phantom stock units will be distributed in cash over a time period elected by the recipient.


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(3)

RPUs are bookkeeping units, the value of each of which corresponds to one share of UPS class B common stock. We grant RPUs under two programs, the Management Incentive Program and the Long-Term Incentive Performance award program.

(4)

Stock option deferral shares are shares held for the individual in a rabbi trust within the UPS Deferred Compensation Plan. Each individual elected to defer the receipt of these shares rather than acquiring them directly upon the exercise of a stock option.

(5)

Other deferred compensation plan shares are amounts within the UPS Deferred Compensation Plan allocated to UPS common stock. These represent the non-employee directors’ retainer fees that have been deferred and invested in UPS stock.

SectionDELINQUENT SECTION 16(a) Beneficial Ownership Reporting ComplianceREPORTS

Section 16(a) of the Securities Exchange Act of 1934 requires our directors, executive officers and persons who own beneficially more than 10% of either our class A or class B common stock to file reports of ownership and changes in ownership of such stock with the SEC. These persons are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file with

the SEC.Securities and Exchange Commission. To our knowledge, based solely on a review of those forms provided to us and any written representations that no other reports were required, for 20182021 each of our directors and executive officers complied  with all applicable Section 16(a) filing requirements.requirements, except for one Form 4 to report two separate transactions for Russell Stokes, which were filed late due to an administrative error.


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Audit Committee Matters

Audit Committee Matters

Audit Committee Matters

Proposal 23 — Ratification of Auditors

What am I voting on?Shareowners are being asked to ratifyRatify the Audit Committee’s (as used in this Audit Committee Matters section, the “Committee”) appointment of Deloitte & Touche LLP (“Deloitte”) to serve as our independent registered public accounting firm for 2019.2022.

VotingBoard’s Recommendation:The Board of Directors recommends that shareowners voteVote FORthe ratification of the appointment of Deloitte & Touche LLP as our independent registered public accounting firm for 2019.2022.

Vote Required:The proposal must be approvedApproval by a majority of the voting power of the shares present in person or by proxy.

Deloitte & Touche LLP (“Deloitte”) has been our independent auditor since we became a publicly-traded entitypublicly traded company in 1999. Prior to becoming a publicly-traded entity,1999, Deloitte also served as the independent auditor of our privately held parent company since 1969. Deloitte audited our 20182021 consolidated financial statements and our internal control over financial reporting. As discussed below, our Audit

The Committee considers Deloitte to be well qualified and has appointed Deloitte as our independent registered public accounting firm for the year ending December 31, 2019.

This proposal asks you to2022. The board recommends that shareholders ratify the appointment of Deloitte as our independent registered public accounting firm for 2019.Deloitte’s appointment. Although we areshareholder ratification is not required, to obtain suchthe board believes that seeking ratification from

our shareowners, the Board of Directors believes it is sounda good corporate governance practice to do so.practice. If the appointment of Deloitte is not ratified, the Audit Committee will reconsider theDeloitte’s appointment. Even if the appointment of Deloitte is ratified, the Audit Committee, in its discretion, may change the appointment at any time during the year if it determines that such a change would be in the best interests of UPS and its shareowners.

A Deloitte representative of Deloitte is expected to be present atattend the Annual Meeting will have the opportunity to make a statement and is expected to be available to respond to appropriate questions by shareowners. The following sections provide additionalshareholder questions. Additional information about our the Committee, Deloitte’s appointment and fees, and other related matters follows.

Audit Committee its selection of Deloitte, Deloitte’s feesReport

Roles and related matters.


Report of the Audit Committee

Responsibilities. The Audit Committee of the Board of Directors is composed solely of independent directors meeting the requirements of applicable SEC and NYSE rules. Each member is financially literate for audit committee purposes under NYSE rules, and the board has concluded that each member qualifies as an audit committee financial expert.

TheCommittee’s key responsibilities of the Audit Committee are set forthdescribed in its charter. The charter whichis reviewed annually and was approved by the board in 2021 and is available on the governance section of the UPS Investor Relations website at www.investors.ups.com. Pursuant to its charter, the Audit Committee’s purposes, duties and responsibilities include:

●Assisting the board in discharging its responsibilities relating to the accounting, reporting and financial practices of UPS;
●Overseeing the accounting and financial reporting processes, including reviewing earnings or annual report press releases, overseeing the integrity of UPS’s financial statements and evaluating major financial risks;
●Having sole authority to appoint, oversee, determine the compensation of and terminate the Company’s independent registered public accounting firm; and
●Overseeing the Company’s systems of disclosure controls and internal controls, the Company’s compliance with legal and regulatory requirements as well as the Company’s Code of Business Conduct.
●assisting the board in discharging its responsibilities relating to Company’s accounting, reporting and financial practices;
●overseeing the Company’s accounting and financial reporting processes, including reviewing earnings or annual report press releases, overseeing the integrity of financial statements and evaluating major financial risks;
●having sole authority to appoint, oversee, determine the compensation of and terminate the Company’s independent registered public accounting firm; and
●overseeing the Company’s disclosure controls and internal controls, compliance with legal and regulatory requirements, and Code of Business Conduct.

Management has primary responsibility for preparing UPS’sthe Company’s financial statements and establishing effective internal control over financial reporting. Deloitte is responsible for auditing those financial statements and UPS’sthe Company’s internal control over financial reporting and expressing an opinion on the conformity of UPS’sthe Company’s audited financial statements with generally accepted accounting principles (“GAAP”) and on the effectiveness of UPS’s internal control over financial reporting based on criteria established by the Committee of Sponsoring Organizations of the Treadway Commission.

The Audit Committee is responsible for appointingappoints the independent registered public accounting firm, understandingapproves the terms of the audit engagement, negotiating the fees for the audit engagement and approving the terms of the audit engagement.reviews and approves Deloitte’s fees. In this context, the Audit Committee discussed with Deloitte the terms of theDeloitte’s 2022 audit engagement, the audit’s overall scope and plan, for the audit, and the other matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board’sBoard (“PCAOB”) auditing standards.and the SEC. The Audit Committee had the opportunity to askasked Deloitte questions relating to such matters.


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Financial Statement Oversight. The Audit Committee met with management and Deloitte to review and discuss the Company’s audited financial statements and the Company’s internal control over financial reporting. The Audit Committee discussed with management and Deloitte the critical accounting policies applied by UPSthe Company in the preparation of its financial statements, the quality, and not just the acceptability, of the accounting principles utilized, the reasonableness of significant accounting judgments, and the clarity of disclosures in the financial statements. The Committee also reviewed and discussed the Company’s enhanced assessment and oversight of the effects of COVID-19 on internal controls and financial reporting.

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The Audit Committee met with Deloitte and UPS’s internal auditors, in each case with and without other members of management present, to discuss the results of their respective examinations, the evaluations of the Company’s internal control and the overall quality and integrity of the Company’s financial reporting. Additionally, the

Internal Audit Oversight. The Committee reviewed UPS’s internal audit plan and the performance, responsibilities, charter, budget and staffing of UPS’s internal auditors.audit function.

Compliance and Ethics Oversight. The Audit Committee met with members of management to discuss the Company’s legal and ethical compliance programs. The Audit Committee also oversaw compliance with and procedures for UPS’sthe receipt, retention and treatment of complaints regarding accounting, internal accounting controls, auditing and other federal securities law matters, including confidential and anonymous submissions of these complaints.

Auditor Independence. Deloitte has provided the Audit Committee with the written disclosures and the letter required by the PCAOB regarding the independent registered public accountants’Deloitte’s communications with the Audit Committee concerning independence, and the Audit Committee has discussed with Deloitte that firm’s independence. The Audit Committee alsodiscussed Deloitte’s independence with the firm and considered whether Deloitte’s provision of non-audit services to UPS was compatible with the independence of the independent registered public accountants.their independence.

Pre-approvals. The Audit Committee has established a policy, discussed below, requiringrequires the pre-approval of all audit and non-audit services provided to UPS by Deloitte. The Audit Committee reviewed and pre-approved all fees paid to Deloitte. These

Committee Assessment of Deloitte. The Committee, along with management and the Company’s internal auditors, reviewed Deloitte’s 2021 performance. The Committee considered the continued independence, objectivity and professional skepticism of Deloitte, the length of time that Deloitte has served as the Company’s independent auditors, the breadth and complexity of the business and its global footprint. The Committee also considered external data and management’s perception of Deloitte’s auditing qualification and experience, the quantity and quality of Deloitte’s staff, Deloitte’s fees, are describedthe communication and interaction with the Deloitte team over the course of the prior year, PCAOB reports on Deloitte, and the potential impact of changing independent registered public accounting firms.

The Committee determined that Deloitte can provide both the necessary expertise and has a similar global footprint to effectively audit UPS worldwide. The Committee also considered the efficiencies resulting from Deloitte’s deep understanding of our business, Deloitte’s focus on independence, their quality control policies, the quality and efficiency of the work performed, and the quality of discussions and feedback sessions. Additionally, the Committee is involved in the next sectionselection of this proxy statement.the new partner-in-charge of the audit engagement when there is a rotation required under applicable rules.

Based on the results of its review, the Committee concluded that Deloitte is independent and that it is in the discussions described above,best interests of UPS and its shareowners to appoint Deloitte to serve as the AuditCompany’s independent registered accounting firm for 2022. The board recommends that shareowners ratify this appointment.

Furthermore, the Committee recommended to the Board of Directors that the audited financial statements be included in UPS’s Annual Report on Form 10-K for the year ended December 31, 20182021 for filing with the SEC.

In addition, as in prior years, the Audit Committee, along with management and UPS’s internal auditors, reviewed Deloitte’s 2018 performance as part of its consideration of whether to appoint Deloitte as UPS’s independent registered public accounting firm for 2019 and to recommend to the board that shareowners ratify this appointment. As part of this review, the Audit Committee considered the continued independence, objectivity and professional skepticism of Deloitte. The Audit Committee also considered, among other things, the length of time that Deloitte has served as UPS’s independent auditors, the breadth and complexity of UPS’s business and its global footprint and the resulting demands placed on its auditing firm in terms of expertise in UPS’s business, external data and management’s perception relating to the depth and breadth of Deloitte’s auditing qualification and experience, the quantity and quality of Deloitte’s staff and global reach, the appropriateness of Deloitte’s fees, the communication and interaction with the Deloitte team over the course of the prior year, PCAOB reports on Deloitte, and the potential impact of changing our independent registered public accounting firm.

The Audit Committee recognized the ability of Deloitte to provide both the necessary expertise to audit UPS’s business and the matching global footprint to audit UPS worldwide, as well as the efficiencies to UPS resulting from Deloitte’s long-standing and deep understanding of our business. The Audit Committee also considered the policies that Deloitte follows with respect to rotation of its key audit personnel, so that there is a new partner-in-charge at least every five years. The Audit Committee is involved in the selection of the new partner-in-charge of the audit engagement when there is a rotation required under applicable rules. Additionally, the Audit Committee considered Deloitte’s focus on independence, their quality control policies, the quality and efficiency of the work performed, and the quality of discussions and feedback sessions. Based on the results of its review, the Audit Committee concluded that Deloitte is independent and that it is in the best interests of UPS and its shareowners to appoint Deloitte to serve as UPS’s independent registered accounting firm for 2019. Consequently, the Audit Committee has appointed Deloitte as UPS’s independent auditors for 2019 and the board is recommending that UPS’s shareowners ratify this appointment.

The Audit Committee
Carol B. Tomé,Eva Boratto, Chair
Michael J. Burns
Candace KendleWayne Hewett
John T. StankeyAngela Hwang


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Audit Committee Matters

Principal Accounting Firm Fees

AggregateThe Committee, with the ratification of the shareowners, engaged Deloitte to perform the annual audits of the Company’s financial statements for each of the fiscal years ended December 31, 2021 and 2020. The aggregate fees billed to us for the fiscal years ended December 31, 20182021 and 20172020 by Deloitte, the member firms of Deloitte Touche Tohmatsu Limited, and their respective affiliates were:are below:

     2018     2017      2021      2020
Audit Fees(1)$14,558,000$14,608,000 $20,246,000 $18,404,000
Audit-Related Fees(2)$968,000$1,234,000 $1,491,000 $1,130,000
Total Audit and Audit-Related Fees$15,526,000$15,842,000 $21,737,000 $19,534,000
Tax Fees(3)$825,000$720,000 $128,000 $271,000
All Other Fees$—$— $— $—
Total Fees$16,351,000$16,562,000 $21,865,000 $19,805,000

(1)

Consists of feesFees for professional services performed by Deloitte for the audit of our annual financial statements and review of financial statements included in our Form 10-Q filings, internal control attestation procedures, statutory audits of foreign subsidiary financial statements and other services associatedthat are normally provided in connection with securitiesstatutory and regulatory filings such as comfort letters and consents.

or engagements.

(2)

ConsistsFees for assurance and related services performed by Deloitte that are reasonably related to the performance of fees forthe audit or review of our financial statements. This includes employee benefit plan and compensation plan audits, independent service auditors’ reports, attestation procedures related to securities offerings, and accounting consultations.

other attestations by Deloitte.

(3)

Consists of feesFees for professional services performed by Deloitte with respect to tax compliance work and tax planning and advice services.

This includes review of original and amended tax returns for the Company and its consolidated subsidiaries, refund claims, and payment planning and tax audit assistance.

Our AuditServices Provided by Deloitte

All services provided by Deloitte are permissible under applicable laws and regulations. The Committee has established a policy requiring the pre-approval of all audit and non-audit services performed by Deloitte in order to help assure that the provision of such services does not impair Deloitte’s independence.

Proposed services may be pre-approved through the application of detailed policies and procedures (“general pre-approval”) or by specific review of each service (“specific pre-approval”). Unless a type of service to be provided to us by Deloitte. Deloitte has received general pre-approval, it requires specific pre-approval by the Committee. Any proposed services exceeding pre-approved cost levels also requires specific approval by the Committee.

The policy provides forAudit, Audit-Related, Tax and All Other services that have received general pre-approval of audit, audit-relatedthe Committee, and taxthose services specificallythat are prohibited, are described in the policy along with the corresponding cost levels. The term of any general pre-approval is twelve months from the date of pre-approval, unless otherwise stated. The Committee annually reviews and pre-approves the services that may be provided by Deloitte without obtaining specific pre-approval and may revise the Audit Committee. list from time to time based on subsequent determinations.

The Audit Committee has delegated to its chairChair the authority to pre-approve certain permitted services between the Audit Committee’s regularly scheduled meetings, and the chairChair must report any pre-approval decisions to the Audit Committee at its next scheduled meeting for review by the Audit Committee. The policy prohibits the Audit Committee from delegating its responsibilities to management the Audit Committee’s responsibility to pre-approvefor pre-approving Deloitte’s permitted services of our independent registered public accounting firm.services.



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Shareowner Proposals

Shareowner Proposals

In accordance with SEC rules, we have set forth below shareowner proposals and the shareowner proponents’ supporting statements. The board’s response to each proposal and voting recommendation are also set forth below. Each shareowner proposal will be voted on at our Annual Meeting only if properly presented at the meeting. The Company is not responsible for any inaccuracies contained in the proposals.

Proposal 34 — Shareowner Proposal Requesting the Board Prepare an Annual Report on Lobbying Activities

What am I voting on? Whether you want to require the board to prepare an annual report on UPS lobbying activities.

Board’s Recommendation: Vote AGAINST this proposal because:

What am I voting on?Whether you want

●UPS already provides significant disclosures and is transparent and accountable with respect to require the board to prepare an annual report on UPS lobbying activities.

Voting Recommendation:The Board of Directors recommends that shareowners voteAGAINSTthis proposal because:

and political activities
●UPS has consistently been named a top company for political transparency and accountability for eight years in a row
●UPS protects and promotes shareowner value by participating in the political process
●UPS is transparent and accountable with respect to lobbying and political activities
●
The board provides independent oversight of UPS’s lobbying and political activities
●Additional lobbying disclosure is unnecessary

Vote Required:The proposal must be approved by a majority of the voting power of the shares present in person or by proxy and entitled to vote.


Shareowner Proposal

Vote Required: Approval by a majority of the voting power of the shares present in person or by proxy.

Shareowner Proposal

Boston Trust Walden Asset Management,Company, One Beacon Street, Boston, MA 02108, has advised us that it is the holder of at least 272,000 shares of our class B common stock and that it,they, along with co-proponents whose names, addresses and share ownership will be promptly provided upon oral or written request to the UPS Corporate Secretary, intendsintend to submit the proposal set forth below for consideration at the Annual Meeting.

Whereas, we believe in full disclosure of UPS’s lobbying activities and expenditures to assess whether its lobbying is consistent with UPS’s expressed goals and in the best interests of shareowners.

Resolved:the shareholdersshareowners of UPS request the Board prepare a report, updated annually, disclosing:

1.

1.

Company policy and procedures governing lobbying, both direct and indirect, and grassroots lobbying communications.

2.

2.Payments by UPS used for (a) direct or indirect lobbying or (b) grassroots lobbying communications, in each case including the amount of the payment and the recipient.

3.

3.UPS’s membership in and payments to any tax-exempt organization that writes and endorses model legislation.

4.

4.Description of management’s and the decision makingBoard’s decision-making process and oversight by management and the Board for making payments described in sectionsections 2 above

and 3 above.

For purposes of this proposal, a “grassroots lobbying communication” is a communication directed to the general public that (a) refers to specific legislation or regulation, (b) reflects a view on the legislation or regulation and (c) encourages the recipient of the communication to take action with respect to the legislation or regulation. “Indirect lobbying” is lobbying engaged in by a trade association or other organization of which UPS is a member.

“Direct and indirect lobbying” and “grassroots lobbying communications” include efforts at the local, state and federal levels.

The report shall be presented to the Nominating and Corporate Governance Committee and posted on UPS’s website.



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Shareowner Proposals

Shareowner’s Supporting Statement

We encourage transparency and accountability regarding staff time and corporatein UPS’s use of funds to influence legislation and regulation. We appreciate UPS’ website disclosure on political contributions, but UPS’s lobbying payments through trade associations remains secret.

lobby. UPS spent $51.3$68.1 million from 2010 to 2017– 2019 on federal lobbying. This total does not include state lobbying, expenditures, where UPS also lobbies but disclosure is uneven or absent. A study found

For example, UPS had at least 122 lobbyists in 29 states in 2019 (followthemoney.org) and spent $1,587,609$1.7 million on lobbying in six statesCalifornia from 20122010 – 2015 (“How Leading U.S. Corporations Govern and Spend on State Lobbying,”Sustainable Investments Institute, February 2017).2019.

UPS sits on the board of the Chamber of Commerce, which has spent over $1.4$1.6 billion lobbying since 1998, and belongs to the Business Roundtable (BRT), which isspent over $43 million on lobbying against the right of shareholders to file resolutions.for 2018 and 2019. UPS does not disclose its memberships in, or payments to trade associations, or the


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amounts for lobbying.

And UPS does not disclose its membership in tax-exempt organizations that write and endorse model legislation, such as sitting on the Private Enterprise Advisory Council of the American Legislative Exchange Council (ALEC). UPS’s ALEC membership continues to draw scrutiny (https://www.prwatch. org/news/2020/05/13583/groups-call-alec%E2%80%99s-corporate-funders-cut-ties-over-its-coronavirus-lobbying). Over 110 companies have left ALEC, including ExxonMobil, Home Depot and Pepsi.

We are concerned that UPS’s lack of trade associationseeming contradictions in public policy advocacy and ALEClimits in disclosure presentspresent reputational risks. For example, UPS signed the BRT Statement on the Purpose of the Corporation advocating socially responsible conduct, yet also attended the ALEC annual conference. (https://readsludge.com/2019/08/27/these-ceos-promised-to-be-socially-responsible-but-their-companies-are-pushing-alecs-right-wing-agenda/). And UPS strongly supports efforts to mitigate the impact of climate change, yet

the Chamber opposed the Paris climate accord. UPS uses the Global Reporting Initiative for sustainability reporting yet fails to report “any differences between its lobbying positions and any stated policies, goals, or other public positions” under Standard 415.

We urge UPS as ato expand its lobbying disclosure.

Response of UPS’s Board member to challenge the Chamber’s negative climate policy. And UPS’s ALEC membership has drawn press scrutiny (“UPS and Pfizer’s Dirty Little Secret,”Washington Post, December 5, 2017), while over 100 companies have publicly left ALEC, including 3M, AstraZeneca, McDonalds and Pepsi.


Response of UPS’s Board

This proposalrequested report is unnecessary becauseand would be an inefficient use of UPS’sCompany resources. UPS already provides extensive disclosures regarding lobbying and political activities and is transparent and accountable. In addition, the board of directors provides effective independent oversight provided by the Board of Directors, and the Company’s existing policies.lobbying and political activities. Preparing aan additional special report beyond UPS’s current voluntary and mandatory disclosures iswould not an efficient usesignificantly alter the mix of resources.information already publicly available. Additionally, UPS’s shareowners previouslyhave rejected this proposal in 2012, 2013, 2014, 2015, 2016, 2017each year since 2012.

UPS already provides significant disclosures and 2018.

UPS has been named a top company for political transparency and accountability eight years in a row.
The Center for Political Accountability Zicklin Index of Corporate Political Accountability and Disclosure ranked UPS among the top of S&P 500 companies for political transparency and accountability in 2018. This is the eighth year in a row that UPS was named as one of the top companies. A copy of the 2018 ranking can be found at www.politicalaccountability.net.

UPS protects and promotes shareowner value by participating in the political process.
UPS’s business is subject to extensive regulation at the federal, state and local levels. We believe that UPS has a responsibility to its shareowners and employees to be engaged in the political process, including lobbying activities. UPS understands that individual shareowners may disagree with one or more positions expressed by certain organizations. In fact, given the variety of business issues in which many trade associations and other groups are engaged, UPS does not necessarily agree with all positions taken by every organization where UPS is a member. In these circumstances, the Company weighs the utility of continued membership against the consequences of differing positions or opinions.

UPS is transparent and accountable.
accountable

UPS complies with all applicable lawlaws with respect to disclosing political and lobbying activities and, in some cases, goes beyond what is required. The following examples demonstrate UPS’s commitment to political transparency and accountability:

●UPS provides significant disclosures about political spending:UPS publishes semi-annual reports disclosing the amounts and recipients of any federal and state political contributions and expenditures made with corporate funds in the United States. UPS also discloses any payments to trade associations that receive $50,000 or more from the Company and that use a portion of the payment for political expenditures pursuant to 26 U.S.C. § 162(e)
●UPS provides significant disclosures about political spending: UPS publishes semi-annual reports disclosing the amounts and recipients, if any, of federal and state political contributions and expenditures made with corporate funds in the United States. UPS also discloses payments, if any, to trade associations that receive $50,000 or more from the Company and that use a portion of the payment for political expenditures pursuant to 26 U.S.C. §162(e)(1) (B). These reports can be found at www.investors.ups.com. UPS did not make any federal or state contributions or non-deductible political payments to covered trade associations during 2021.
●UPS provides detailed information about lobbying activities: UPS files publicly available federal Lobbying Disclosure Act Reports each quarter. Links to these reports can be found at www.investors.ups.com. The reports provide information about expenditures for the quarter, describe the specific legislation that was the topic of communications, and identify the employees who lobbied on UPS’s behalf. UPS files similar periodic reports with state agencies reflecting state lobbying activities as required.

UPS has consistently been named a top company for political transparency and accountability

In 2021, for the eleventh straight year, the Center for Political Accountability Zicklin Index of Corporate Political Accountability and Disclosure ranked UPS among the top of S&P 500 companies for political transparency and accountability. A copy of the ranking can be found at www.investors.ups.com. As disclosedhttps://www.politicalaccountability.net/cpa-zicklin-index/.

UPS protects and promotes shareowner value by participating in the political process

UPS is subject to extensive regulation at the federal, state and local levels. While there are many regulatory issues that impact our most recent report,business, as a logistics company, we are focused on fair taxation, commercially reasonable regulation, expansive trade, and a level playing field with competitors. UPS did not make any federal or state contributions or non-deductiblealso works to advance the interests of our employees when they intersect with our business operations.

We believe that we have a responsibility to our shareowners, employees and other stakeholders to engage in the political payments to coveredprocess, including through lobbying activities. We understand that individual stakeholders may disagree with certain positions expressed by various organizations. In fact, given the variety of business issues in which many trade associations duringand other groups are engaged, we do not necessarily agree with all positions taken by every organization in which we are a member. However, we

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generally believe that our membership in various organizations allows us to better advance UPS positions. In circumstances where we disagree with a policy position, we weigh the July 1 – December 31, 2018 time period.

●UPS provides detailed information about lobbying activities:UPS files publicly available federal Lobbying Disclosure Act Reports each quarter. Links to these reports can be found on UPS’s web site at www.investors.ups.com. utility of continued membership against the consequences of differing positions or opinions.

The reports provide information about expenditures for the quarter, describe the specific pieces of legislation that were the topic of communications, and identify the employees who lobbied on UPS’s behalf. UPS files similar periodic reports with state agencies reflecting state lobbying activities.

The Boardboard provides independent oversight of UPS’s lobbying and political activities.
The President of activities

UPS’s PublicChief Corporate Affairs departmentOfficer regularly reports to the Board of Directors and the Nominating and Corporate Governance Committee regarding UPS’s lobbying and political activities. In addition, the Nominating and Corporate Governance Committee, of the Board of Directors, which is composed entirely of independent directors, reviews and approves UPS’s semi-annual political contribution report.

The Board of Directorsboard also monitors UPS’s memberships in trade associations and other tax exempttax-exempt organizations that engage in lobbying. UPS must often decide whether to participate in a variety of trade associations and other tax exempttax-exempt organizations. The Company may participate when involvement is consistent with specific UPS business objectives. These decisions are subject to board oversight and are regularly reviewed by the Nominating and Corporate Governance Committee.

Furthermore, UPS’s decision-making process for lobbying activities is transparent. UPS’s Public Affairs department works with senior management on furthering business objectives and on protecting and enhancing long-term shareowner value. This is accomplished by focused involvement at all levels of government. Moreover, the UPS Public Affairs department must approve all lobbying activities and any payments to trade associations or other tax-exempt organizations that engage in lobbying activities.

Additional lobbying disclosurePreparing an additional report is unnecessary.
UPS participates in the political process in accordance with good corporate governance practices. unnecessary

The board believes UPS’s lobbying activities are transparent, and the adoptionapproval of this proposal is unnecessary given the information that is already publicly available. In addition, adoptionTherefore, approval of this proposal iswould not result in an efficient use of resources and will only serve to benefit the limited interests of a small group of shareowners.


For these reasons, the board recommends that shareowners vote AGAINST this proposal.

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Shareowner Proposals

Proposal 45 — Shareowner Proposal Requesting the Board Prepare a Report on the Alignment of Lobbying Activities with the Paris Climate Agreement

What am I voting on? Whether you want to require the board to prepare a report on the alignment of UPS lobbying activities with the Paris Climate Agreement and how UPS plans to mitigate risks presented by any misalignment.

Board’s Recommendation: Vote AGAINST this proposal because:

●UPS has recently adopted and published ambitious goals to reduce GHG emissions and achieve carbon neutrality by 2050
●UPS already provides comprehensive and detailed annual sustainability disclosures
●UPS also already provides significant lobbying and political disclosures, and is transparent and accountable
●The board provides independent oversight of UPS’s lobbying

Vote Required: Approval by a majority of the voting power of the shares present in person or by proxy.

Shareowner Proposal

Mercy Investment Services, Inc., 2039 North Geyer Road, St. Louis, Missouri 63131-3332, has advised us that, along with co-proponents whose names, addresses and share ownership will be promptly provided upon oral or written request to the UPS Corporate Secretary, intends to submit the proposal set forth below for consideration at the Annual Meeting.

Resolved: Shareholders of United Parcel Service (“UPS”) request that the Board of Directors conduct an evaluation and issue a report within the next year (at reasonable cost, omitting proprietary information) describing if, and how, UPS’s lobbying activities (direct and through trade associations and social welfare and nonprofit organizations) align with the Paris Climate Agreement’s goal of limiting average global warming to well below 2 degrees Celsius and how the company plans to mitigate risks presented by any misalignment.

Shareowner’s Supporting Statement

According to the annual “Emissions Gap Report” issued by the United Nations Environment Programme (November 26, 2019), critical gaps remain between the commitments national governments have made and the actions required to prevent the worst effects of climate change. Companies have an important and constructive role to play in enabling policymakers to close these gaps.

Corporate lobbying activities that are inconsistent with meeting the goals of the Paris Agreement present regulatory, reputational, and legal risks to companies and investors and to the entire economy. Delays in implementation of the Paris Agreement increases the physical risks of climate change, poses a systemic risk to economic stability, and introduces uncertainty and volatility into our portfolios; Paris-aligned climate lobbying by companies and trade associations help to mitigate these risks.

As investors, we view fulfillment of the Paris Agreement’s goal—to hold the increase in the global average temperature to “well below” 2°C above preindustrial levels, and to pursue efforts to limit the temperature increase to 1.5°C — as an imperative. Of particular concern are trade associations that speak for business but, unfortunately, often present forceful obstacles to progress in addressing the climate crisis.

In 2020 and 2021, seven companies received shareholder resolutions urging their boards to publish evaluations of their climate lobbying efforts; six of those resolutions received a majority vote, demonstrating a tremendous show of investor interest in this issue. Numerous companies in both the U.S. and Europe have produced or agreed to issue reports evaluating their lobbying programs in the past two years.

We commend UPS for recently setting a Paris-aligned Net Zero emissions goal and a concrete plan to implement it. We believe a company should carefully evaluate whether its public policy advocacy advances or undercuts the goals of the Paris Agreement.

UPS presently provides insufficient information to help investors understand if or how UPS works to ensure that its lobbying activities, directly, in the company’s name, and indirectly, through membership organizations and trade associations, align with the Paris Agreement’s goals, and what management and the board do to address any misalignments found.

UPS is an active member of the American Legislative Exchange Council (ALEC), which frequently takes negative positions on climate change. UPS does not disclose what actions they take when an organization like ALEC contradicts UPS’s own climate positions. Similarly, UPS does not disclose how they engage major trade associations, such as the U.S. Chamber of Commerce, on climate lobbying activities.

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Response of UPS’s Board

UPS has recently adopted and disclosed comprehensive GHG reduction goals and already provides extensive sustainability and lobbying related disclosures. In addition, the Board of Directors provides effective oversight of the Company’s lobbying activities, and its sustainability goals and practices. As a result, preparing this requested report is unnecessary and would be an inefficient use of Company resources.

UPS has recently adopted and published ambitious goals to reduce GHG emissions and achieve carbon neutrality by 2050, including interim targets

UPS strives to be a good steward of the environment and is highly motivated to meet the Company’s ambitious sustainability goals. In 2021, we announced our new ESG strategy, including a commitment to become carbon-neutral across our global operations by 2050, including Scope 1, 2 and 3 emissions. We also developed and disclosed medium-term goals designed to help us achieve carbon neutrality. As part of this strategy, UPS intends to work with industry participants to accelerate the shift to sustainable aviation fuel (SAF). Our robust sustainability goals, and current progress towards achieving them, are further detailed in our corporate sustainability disclosures.

UPS already provides comprehensive and detailed annual sustainability disclosures

UPS already reports company-wide emissions and tracks and discloses target progress annually. Each year, we publish comprehensive sustainability related disclosures showcasing our commitments to our customers, our employees and the communities in which we operate. This includes disclosures under the Global Reporting Initiative (GRI), the Carbon Disclosure Project (CDP), the Sustainability Accounting Standards Board (SASB) and the Task Force on Climate-Related Financial Disclosures (TCFD) frameworks. We believe these disclosures provide shareowners the information they need to assess the Company’s sustainability efforts and progress.

UPS already provides significant political and lobbying disclosures, and is transparent and accountable

UPS complies with all applicable laws with respect to disclosing political and lobbying activities and, in some cases, goes beyond what is required. The following examples demonstrate UPS’s commitment to political transparency and accountability:

●UPS provides significant disclosures about political spending: UPS publishes semi-annual reports disclosing the amounts and recipients, if any, of federal and state political contributions and expenditures made with corporate funds in the United States. UPS also discloses payments, if any, to trade associations that receive $50,000 or more from the Company and that use a portion of the payment for political expenditures pursuant to 26 U.S.C. §162(e)(1) (B). These reports can be found at www.investors.ups.com. UPS did not make any federal or state contributions or non-deductible political payments to covered trade associations during 2021.
●UPS provides detailed information about lobbying activities: UPS files publicly available federal Lobbying Disclosure Act Reports each quarter. Links to these reports can be found at www.investors.ups.com. The reports provide information about expenditures for the quarter, describe the specific legislation that was the topic of communications, and identify the employees who lobbied on UPS’s behalf. UPS files similar periodic reports with state agencies reflecting state lobbying activities.

The board provides independent oversight of UPS’s sustainability efforts and lobbying activities

UPS’s Chief Corporate Affairs Officer regularly reports to the Nominating and Corporate Governance Committee regarding UPS’s sustainability efforts and lobbying activities. The board monitors UPS’s memberships in trade associations and other tax-exempt organizations that engage in lobbying, including on climate related matters. Furthermore, UPS’s decision-making process for lobbying activities, and its sustainability journey, is transparent. UPS’s Public Affairs department works with senior management on furthering business objectives and on protecting and enhancing long-term shareowner value.

Preparing an additional report is unnecessary

The board believes UPS’s sustainability goals are robust, and its policies and practices are transparent. Approval of this proposal is unnecessary given the information that is already publicly available. Therefore, approval of this proposal would not result in an efficient use of resources and will only serve to benefit the limited interests of a small group of shareowners.

For these reasons, the board recommends that shareowners vote AGAINST this proposal.

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Shareowner Proposals

Proposal 6 — Shareowner Proposal to Reduce the Voting Power of Class A Stock from 10 Votes Per Share to One Vote Per Share

What am I voting on?Whether you want the board to take steps to reduce the voting power of the Company’s class A stock from 10 votes per share to one vote per share.

VotingBoard’s Recommendation:The Board of Directors recommends that you voteVote AGAINSTthis proposal because:

●UPS’s ownership structure has contributed to its long-term success
●UPS class A shares are widely held with over 154,000 class A shareowners as of February 25, 2019
●Elimination of this structure will not improve the corporate governance or the long-term financial performance of the Company

●UPS’s capital structure has contributed to its long-term success
●UPS’s capital structure is unique and does not present the concerns inherent in typical dual-class structures
●UPS’s dual-class structure does not concentrate voting power or provide any level of control. Class A shares are held by more than 155,000 owners, and management, collectively, holds less than 1% of the voting power of our stock
●UPS’s dual-class structure does not entrench management or the board. There is no controlling founder or family, and we regularly refresh management and the board
●UPS’s governance documents provide additional safeguards against traditional dual-class concerns. Transfers of Class A shares are limited, resulting in conversions, and voting restrictions would apply upon the acquisition of a significant block of shares
●Eliminating this structure will not further improve UPS’s corporate governance or financial performance

Vote Required:The proposal must be approvedApproval by a majority of the voting power of the shares present in person or by proxy and entitled to vote.


Shareowner Proposal
proxy.

Shareowner Proposal

John Chevedden, 2215 Nelson Avenue, No. 205, Redondo Beach, CA 90278, has advised us that he is the holder of not less than 50 shares of our class B common stock and that he intends to submit the proposal set forth below for consideration at the Annual Meeting.

Proposal 46 — Equal Voting Rights for Each Shareholder

RESOLVED: Shareholders request that our Board of Directors take steps to ensure that all of our company’s outstanding stock has an equal one-vote per share in each shareholder voting situation. This would encompass all practicable steps including encouragement and negotiation with current and future shareholders, who have more than one voteone-vote per share, to request that they relinquish, for the common good of all shareholders, any preexisting rights, if necessary.

This proposal is not intended to unnecessarily limit our Board’s judgment in crafting the requested change in accordance with applicable laws and existing contracts. This proposal is important because certain shares have super-sized voting power with 10-votes per share compared to the weakling one-vote per share for other shareholders. Corporate governance advocates have suggested a 7-year transition to equal voting rights for each share.

In spite of lopsided shares having 10-times more voting power, support for this proposal topic has steadily grown from 21% in 2013 to 29% in 2021.

With stock having 10-times more voting power our companyUPS takes our shareholder money but does not give us in return an equal voice in our company’s management. Without a voice, shareholders cannot hold management accountable. It is important to continue to vote for this proposal to block UPS management from finding creative ways to further reduce their money at risk at UPS while maintaining the same control.

Plus, with the UPS shareholder-unfriendly brand of corporate governance, we had no right to call a special meeting or act by written consent. And we were restricted by provisions mandating an undemocratic 80%-vote in order to make a certain improvements to our corporate governance. This undemocratic 80% vote requirement translates into a well over a 100% vote requirement from the shares that typical vote at the annual meeting.

And to top bad things off our management recommended that they get a 3-year holiday on a shareholder vote on their executivemanagement pay. The vast majority of Fortune 500 companies recommendedhave an annual shareholder vote on executivemanagement pay. Excellent corporate governance is a cost-effective way to improve company stock performance.

As an example for UPS, social and mobile-game maker Zynga announced moving to a single-class share structure in 2018. At Zynga which madesaid its public market debut in 2011, Class C shares had 70 votes aold multi-class share and Class B shares had seven votes asystem could negatively impact its share while Class A shares had one vote per share.price.

Corporate governance advocates as well as many investors and index managers have pushed back on the UPS-type dual-class structures. Last year, S&P Dow Jones Indices said that companies with multiple classes of shares would be barred from entering its flagship S&P 500 index.

Zynga executives said in a letter to its shareholders that a single-class share structure simplifies the company’s stock structure and gives parity to shareholders. In its 2018 annual report, Zynga said its old multi-class share system could limit the ability of its other stockholders to influence the company and could negatively impact its share price.

Please vote yes:Equal Voting Rights for Each Shareholder — Proposal 46


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Response of UPS’s Board

Response of UPS’s Board

UPS has a unique employee ownership culture that has helped it grow and thrive over the last 110 years.thrive. Current and former employees and their families have been the primarysignificant shareowners of the Company since its founding in 1907. This culture was instilled in the Company by UPS founder Jim Casey who always urgedfostered this culture by urging his partners to run their centers and departments like their own small business. Our employee ownership culture creates a significant incentive for our employees to help facilitate UPS’s long-term success.

The Company’s current ownershipcapital structure, which has been in place since UPS became a public company in 1999, includes class A and class B common stock. The class A shares are held by current and former UPS employees and their families, many of whom owned UPS shares before the Company’s initial public offering. The Company’s class B shares are publicly traded.

The basic principle which I believe has contributed more than any other to the building of our business as it exists today . . . is the ownership of our company by the people employed in it.
Jim Casey, UPS Plant Managers Conference, 1955

This structure provides a significant incentive for our employees to take actions and make decisions that help facilitate UPS’s ownershiplong-term success, resulting in aligned interests among all shareholders. The structure also significantly enhances employee and retiree engagement.

UPS’s capital structure has contributed to its long-term success

The interests of employees, who hold class A shares, go beyond UPS’s current stock price and include operating the Company with a broader focus, which leads to long-term success.
Our ownership We owe our growth and achievements, to a significant degree, to the commitment our capital structure has inspired in our employees and retirees.

This capital structure allows the Companymanagement to pursue long-term growth strategies and avoid the drawbacks associated with excessive emphasis on short-term goals. In this regard, the interests of UPS employees and class B shareowners are aligned. Management is able to run the Company with a sense of purpose by focusing on sustainable value creation that benefitsbenefiting all of the Company’s constituents. We believe thatstakeholders. In this regard, the benefitsinterests of our ownershipall UPS shareowners are aligned.

UPS’s capital structure are reflectedis unique and does not present concerns inherent in various financial metrics used to measure UPS, especially when compared with our competitors.

Our class A shareowners’ interests go well beyond UPS’s current stock price and focus on the long-term success of the Company. Since its humble beginnings in 1907, UPS has become the world’s largest package delivery company, a leader in the U.S. less-than-truckload industry and the premier provider of global supply chain management solutions. We owe our success, to a significant degree, to the commitment our ownership structure inspires in our employee owners.typical dual-class structures

UPS Class A shares are widely held.
The board strongly disagrees with this proposal’s characterization of UPS’s ownershipcapital structure. Some companies maintain multiple classes of stock in order to concentrate voting power with a limited number of people (such as company founders) who have unique interests that may not necessarily align with those of other shareowners. In contrast, Others embed the structure to promote managerial entrenchment or provide for disparate financial returns. None of those concerns are present at UPS.

UPS’s dual-class structure does not concentrate voting power or provide any level of control

UPS’s dual-class structure is unique in that the class A shares are widely held by approximately 155,000 current and former employees, from hourly employees to executive officers. In fact, there wereOur executive officers and directors, collectively, hold less than 1% of the total voting power of our class A and class B common stock. As a result, UPS executive officers and directors are not able to exercise control or any significant influence over 154,000 holdersvoting decisions, and do not have any level of control.

UPS’s dual-class structure does not entrench management or the board

UPS’s maintains robust corporate governance practices, and its capital structure is not used to entrench management or the board. The board regularly reviews and considers succession planning issues. Our CEO has served in that role only since June 2020 and, since 2020, we have added five new board members and had four board members retire.

UPS’s governance documents provide additional safeguards against traditional dual-class concerns

UPS’s certificate of incorporation (the “Certificate”) contains a number of provisions intended to protect class B shareholders. Generally, class A shares convert to class B shares upon sale or transfer (unless transferred by an employee to a spouse or child), which over time has resulted, and is expected to continue to result, in a decline in outstanding shares of the class A stock, with the average annual decline of 3.4% per year since the Company went public. For example, as of March 1, 2021, class A common stock represented 17.0% of all outstanding shares of common stock, and as of March 1, 2022, represented 15.8% of all outstanding shares of common stock. The Certificate also contains provisions that would limit the voting power of any shareholder, whether the holder of class A sharesor class B common stock, if that holder controlled over 25% of UPS’s outstanding voting power. In addition, the Certificate generally requires equal economic treatment of the class A and class B common stock, ensuring that holders of one class would not receive disparate treatment as a result of February 25, 2019.different voting rights.

Elimination ofEliminating this structure will not further improve theUPS’s corporate governance or the long-term financial performance of the Company
UPS’s ownership structure should be considered in light of our strong

UPS already maintains robust corporate governance practices, as discussed beginningpractices. We provide shareowners with an annual opportunity to vote on page 10 of this proxy statement. All but onemanagement pay (say on pay vote). Other than our CEO, all UPS director nominee is independent, allnominees are independent. All UPS directors are elected annually by a majority of votes cast in uncontested director elections, only independent directors serve on the board’s Audit, Committee, Compensation Committee,and Human Capital, Nominating and Corporate Governance Committee and Risk Committee,Committees, and we have an independent lead director. In addition, as partBoard Chair. Our board consists of its ongoing commitment to strong corporate governance practices following thoughtful discussions with shareowners through46% female directors, 31% ethnically diverse directors, and contains an appropriate mix of newer and longer-tenured directors.

Changing the Company’s long-standing outreach program, the board regularly reviews and updates the Company’s governance policies and practices, including the proactive adoption a proxy access bylaw.capital structure is unnecessary

For the reasons discussed above, theThe board believes that UPS’s ownershipcurrent capital structure continues to be in the best interests of the Company and its shareowners. Elimination of this structure will not improve the corporate governance or the long-term financial performance of the Company. The board also believes that our shareownersstakeholders. Shareowners have agreed with this assessment when they rejected similar proposals at our Annual Meeting of Shareowners in 2013, 2014, 2015, 2016, 2017 and 2018.every year since 2013.


The board recommends that shareowners vote AGAINST this proposal.

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Shareowner Proposals

Proposal 57 — Shareowner Proposal Requesting the Board Prepare a Report Assessing the IntegrationAdoption of Sustainability Metrics into Executive CompensationIndependently Verified Science-Based Greenhouse Gas Emissions Reduction Targets

What am I voting on?Whether you want to require the board to prepare a report assessing the feasibility of integrating sustainability metrics into executive compensation.

agree to alternative greenhouse gas emissions reduction targets.

VotingBoard’s Recommendation:The Board of Directors recommends that you voteVote AGAINSTthis proposal because:

●UPS is widely recognized for its sustainability practices.
●The Compensation Committee carefully considers the appropriate metrics for the company’s incentive compensation programs.
●Sustainability performance already impacts executive compensation.

●UPS’s ESG goals include a plan to become carbon neutral across our global operations, including our airline, by 2050
●Our strategy includes addressing airline fuel emissions and the electrification of our delivery fleet
●UPS provides transparency, including comprehensive sustainability disclosures with regular updates on our progress
●UPS is committed to continuing to reduce our carbon footprint in a comprehensive and responsible manner

Vote Required:The proposal must be approvedApproval by a majority of the voting power of the shares present in person or by proxyproxy.

Shareowner Proposal

Green Century Capital Management, Inc., 114 State Street, Suite 200, Boston, MA 02109, Trillium Asset Management LLC, Two Financial Center, 60 South Street, Suite 1100, Boston, MA 02111, and entitled to vote.


Shareowner Proposal

Zevin Asset Management, LLC, 2 Oliver Street, Suite 806, Boston, MA 02109, hashave advised us that it intendsthey intend to submit the proposal set forth below for consideration at the Annual Meeting on behalf of the Merrily Lovell 2007Green Century Balanced Fund, the James T. Campen Trust, holder of400 sharesand the John Hancock ESG Large Cap Core Fund.

Whereas: In 2018, the Intergovernmental Panel on Climate Change evaluated the goals of the 2015 Paris Agreement and advised that net carbon emissions must fall 45% by 2030 and reach net zero by 2050 in order to limit warming below 1.5 degrees Celsius and prevent the worst consequences of climate change. However, in 2020, the UN reported the world is “way off-track” from achieving these goals.1

Exceeding 1.5 degrees Celsius presents risks to the global economy and investors: up to 10% of total global economic value is projected to be lost by 2050 under current emissions trajectories. A warming climate is associated with supply chain disruptions, reduced resource availability, lost production, political instability, reduced worker efficiency, and adverse health impacts that disproportionally affect low-income communities and communities of color.2 Additionally, particulate matter emissions from heavy-duty diesel vehicles pollute communities of color at significantly higher rates than white communities.3

While UPS has announced a goal to achieve carbon neutrality in its operations by 2050 and a 50% reduction in emissions per small package delivered by 2035, shareholders do not know if UPS plans on achieving net zero through actual emissions reductions or through the purchase of carbon offsets. In order to assure shareholders that its goals align with the Paris Agreement, UPS should set a science-based target verified by the Science Based Targets Initiative (SBTi), which requires annual disclosure of emissions.

Whereas peers like FedEx and Amazon have set goals for procurement of electric vehicles, UPS’ goals for its ground fleet rely on alternative fuel, which unnecessarily prolongs potential emissions and bolsters fossil fuel infrastructure.4 UPS’ current emissions reduction goals do not include Scope 3 emissions, which, according to UPS’ 2020 TCFD report, constitute 57% of its total.5

Given the impact of climate change on the economy, the environment, and human systems, and UPS’s contribution to it, proponents believe the UPS board and management have a responsibility to its investors and stakeholders to adopt GHG goals aligned with a 1.5 degree scenario and to outline a clear plan that demonstrates accountability. Independently verified, science-based goals covering Scopes 1-3 would provide shareholders with objective assurance that UPS is doing its part to reduce emissions in a comprehensive and timely manner.

Resolved: Shareholders request that UPS adopt independently verified short, medium, and long-term science-based greenhouse gas emissions reduction targets, inclusive of emissions from its full value chain, in order to achieve net-zero emissions by 2050 or sooner and to attain appropriate emissions reductions prior to 2030, in line with the Paris Agreement’s goal of maintaining global temperature rise at 1.5 degrees Celsius.

1https://library.wmo.int/doc_num.php?explnum_id=10211
2https://www.swissre.com/institute/research/topics-and-risk-dialogues/climate-and-natural-catastrophe-risk/expertise-publication-economics-of-climate-change.html
3https://www.nytimes.com/2021/04/28/climate/air-pollution-minorities.html
4https://www.sightline.org/2021/03/09/the-four-fatal-flaws-of-renewable-natural-gas/
5https://about.ups.com/content/dam/upsstories/assets/reporting/sustainability-2021/2020_UPS_TCFD_Report_081921.pdf
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Supporting Statement: In assessing targets, we recommend, at management’s discretion:

●Consideration of approaches used by advisory groups such as the Science Based Targets initiative;
●Disclosing these targets to investors at least 180 days prior to the next annual meeting.

Response of UPS’s Board

UPS supports global efforts to mitigate the impact of climate change. Sustainability is an inherent part of UPS’s strategy and business operations. We take a comprehensive, global approach to reducing energy use and GHG emissions within our networks, as well as major portions of our class B common stock.

RESOLVED:Shareholders requestvalue chain. As a global leader in logistics and supply chain solutions, we transport packages, facilitate international trade, and apply advanced technology to efficiently manage the Board Compensation Committee prepareworld of business. In this role, we have an opportunity to reduce GHG emissions throughout the supply chains of many businesses, including by efficiently consolidating multiple shipments and otherwise reducing carbon intensity.

UPS’s ESG goals include a report assessing the feasibility of integrating sustainability metrics into the performance measures of senior executives underplan to become carbon neutral across our global operations, including our airline, by 2050

UPS effectively manages to meet the Company’s compensation incentive plans. Sustainability is defined as how environmentalambitious sustainability goals. In 2021, we announced our new ESG strategy, including a commitment to become carbon-neutral across our global operations by 2050, including Scope 1, 2 and social considerations,3 emissions. We also developed medium-term goals designed to help us achieve carbon neutrality, including adopting interim targets to reduce carbon emissions per package within our small package operations by 50% against a 2020 baseline; to be fully powered by renewable electricity in our facilities; and related financial impacts, are integrated into corporate strategy over the long term.


Shareowner’s Supporting Statement

Effectively managing for sustainability offers positive opportunities for companies and should be a key metricto fuel 30% of our global air fleet using sustainable sources by which executives are judged.

Linking sustainability metrics to executive compensation could reduce risks related to sustainability underperformance, incent employees to meet2035. Our robust sustainability goals, and current progress towards achieving them, are further detailed in our corporate sustainability disclosures.

Our strategy includes addressing airline fuel emissions, the electrification of our delivery fleet, and includes Scope 3 emissions

UPS takes seriously the need to transform our delivery fleet and has already made significant strides to this end. In developing our strategy, we evaluated the adoption of science-based targets. We determined that there are no scalable solutions for aircraft or heavy-duty vehicles at this time to achieve resultant benefits,a science-based target by 2030 or 2035. The primary decarbonization path for the aviation sector is SAF, and more innovation is needed. In order to achieve our 30% SAF by 2035 goal, we are engaging with airline industry and non-governmental organizations to evaluate the availability and commercial feasibility of SAF.

In 2020, aircraft fuel made up 61% of our total Scope 1 and Scope 2 GHG emissions. Our Fuel Analytics and Sustainability Group continuously evaluates opportunities to further reduce our emissions in this area, including accelerating efforts to reduce the carbon intensity of our fleet. We currently have one of the youngest, most fuel-efficient fleets in the industry. We take a disciplined approach to emissions reductions. When appropriate, we make capital investments in newer, more fuel-efficient aircraft. We recently announced the purchase of 19 new freighter aircraft, which will make our fleet more efficient and reliable. In addition, we look for opportunities to retrofit older aircraft to further increase accountability. Examplesefficiency with the goal of metrics relevantlowering our carbon footprint.

Additionally, UPS’s fleet of more than 13,300 alternative fuel and advanced technology vehicles includes all-electric, hybrid electric, hydraulic hybrid, ethanol, compressed natural gas (CNG), liquefied natural gas (LNG) and propane vehicles. We continue to expand this specialized fleet, having placed an order for 125 Tesla all-electric semi-trucks, and having announced a commitment to purchase up to 10,000 electric vehicles from Arrival, which are expected to be delivered beginning in 2022. Along with these commitments, and as part of UPS’s continued efforts to build an integrated fleet of electric vehicles, our venture capital arm, UPS Ventures, evaluates investments to allow us to collaborate and support the development of EV technologies.

UPS provides transparency, including comprehensive sustainability disclosures with regular updates on our progress

Each year, UPS reports company-wide emissions and tracks and discloses progress towards our targets. We publish comprehensive sustainability related disclosures showcasing our commitment to our Company could include: energy/fuel efficiency, renewable energy goals, diversity goals, customer satisfaction scores, worker healthinvestors, our customers, our employees and safety,the communities in which we operate. These include disclosures under the Global Reporting Initiative (GRI), the Carbon Disclosure Project (CDP), the Sustainability Accounting Standards Board (SASB) and greenhouse gasthe Task Force on Climate-Related Financial Disclosures (TCFD) frameworks. UPS’s sustainability disclosures are extensive, targeted, and inclusive of Scope 1, Scope 2, and Scope 3 GHG emissions.

WHEREAS:Numerous studies suggest companies that integrate environmental, social We believe these disclosures provide stakeholders the information they need to assess our sustainability efforts and governance (ESG) factors into their business strategy reduce reputational, legal and regulatory risks and improve long-term performance.progress.

UPS has taken stepsis committed to address ESG issues and has developed a set of corporate sustainability goals. However,continuing to reduce our Company has not explicitly linked sustainability goals with senior executive incentives. Investors seek clarity on how UPS drives sustainability improvement and how that strategy is supported by executive accountability. Integrating sustainability into executive compensation assessments would enhance UPS’s approach.

A large and diverse group of companies has integrated sustainability metrics into executive pay incentive plans, among them Alcoa, Unilever, PepsiCo, Walmart, and Danone.

The 2016 Glass Lewis reportIn-Depth: Linking Compensation to Sustainabilityfinds a “mounting body of research showing that firms that operatecarbon footprint in a morecomprehensive and responsible manner may perform better financially . . . Moreover, these companies were also more likely

We believe everyone shares responsibility to tie top executive incentivesimprove energy efficiency and reduce GHG emissions. UPS supports global efforts to sustainability metrics.”

A 2015 Harvard Business School studymitigate the impact of S&P 500 executives’ pay packages found a positive relationship betweenclimate change. Our optimized global smart logistics network, combined with our global GHG strategy, helps improve our efficiency and reduce our environmental impact. This technology and innovation driven strategy includes the presence of explicit incentive compensation for corporate social responsibility (CSR) and firms’ social performance (Hong, et al, 2015).following:

A 2012 guidance issued by the United Nations Principles for Responsible Investment and the UN Global Compact found “the inclusion of appropriate Environmental, Social and Governance (ESG) issues within executive management goals and incentive schemes can be an important factor in the creation and protections of long-term shareholder value.”

A 2011 study of 490 global companies found that including sustainability targets in compensation packages was sufficient to encourage sustainable development.

The increasing incorporation of sustainability metrics into executive pay evaluative criteria stems from the growing recognition that sustainability strategies can drive growth, and enhance profitability and shareholder value.

According to the largest study of CEOs on sustainability to date (“CEO Study on Sustainability 2013,” UN Global Compact and Accenture):

●76 percent believe embedding sustainability into the core business will drive revenue growth and new opportunities.

●86 percent believe sustainability should be integrated into compensation discussions, and 67 percent report they already do.

64 ●Maintaining a leadership role in decarbonizing the transportation and logistics industries;
 
●Operational improvements through technology to create overall network and delivery efficiencies beyond miles/fuel that reduce our GHG footprint;
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●Expanding our fleet of alternative fuel and advanced technology vehicles, known as our Rolling Laboratory, in order to reduce the proportion of conventional fuels we use;
●Supporting the testing and development of alternative air solutions, including drone delivery and the use of SAF;
●Reducing conventional and increasing renewable energy use in our facilities;
●Providing customers with services that help them reduce their environmental impact; and
●Helping increase supplier awareness about GHG emissions and how to reduce them.

The board believes this proposal is unnecessary given the information that is already publicly available. Therefore, approval of this proposal would not result in an efficient use of resources and will only serve to benefit the limited interests of a small group of shareowners.

For these reasons, the board recommends that shareowners vote AGAINST this proposal.

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Proposal 8 — Shareowner Proposal Requesting a Report on Balancing Climate Measures and Financial Returns

What am I voting on? Whether you want to require the board to publish a report on UPS decisions regarding GHG emissions reductions in light of financial performance and environmental costs and risks of climate change.

Board’s Recommendation: Vote AGAINST this proposal because:

Response●Commissioning this report is misguided and impracticable
●UPS already provides transparency, including comprehensive sustainability disclosures with regular updates on our progress
●UPS continues to demonstrate our commitment to reducing our carbon footprint for the benefit of UPS’s Boardall stakeholders

Vote Required: Approval by a majority of the voting power of the shares present in person or by proxy.

Shareowner Proposal

Myra K. Young, 9295 Yorkship Court Elk Grove, CA 95758, has advised us that she intends to submit the proposal set forth below for consideration at the Annual Meeting.

ITEM 8: Report on balancing climate measures and financial returns

RESOLVED, shareholders ask the board to commission and publish a report on (1) the extent (if any) to which Company decisions involving greenhouse-gas emissions reduction prioritize Company financial performance over the environmental costs and risks of climate change and (2) the manner in which any consequent environmental costs and risks threaten returns of diversified shareholders who rely on a stable and productive economy.

Supporting Statement:

In 2020, the Company announced a roadmap to carbon neutrality in 2050. The Company has established the following specific goals:

●By 2025
●25 percent renewable electricity for facilities
●40 percent alternative fuel purchases as a percent of total ground fuel
●By 2035
●30 percent sustainable aviation fuel
●100 percent renewable electricity for facilities
●50 percent reduction in carbon dioxide per package delivered for global small packages.1

These goals do not appear consistent with the consensus on measures necessary to keep global warming below disastrous levels. More consistent measures could include:

●Meeting a 1.5-degree Celsius Science-Based Target standard
●Achieving a 50 percent reduction in greenhouse-gas emissions by 2030
●Committing to purchasing only electric light-duty vehicles by 2025

The gap between the Company’s declared goals and “Paris alignment” may be due to the Company’s decision only to address the risk of climate change to the enterprise, rather than addressing the risks the Company poses to the environment: while the Company identifies climate change as having “inherently high risk to the organization,” 2 the public documents that discuss the Company’s climate stance disclose no consideration of climate change’s broad environmental stakes such as:

●Halving GDP growth by the end of the century3
●Having “broad implications for macroeconomic performance, including inflation, interest rates, balance of payments, productivity, wealth, and gross domestic product (GDP) growth”4
●Shrinking the world economy by 3 percent by 2050.5
1https://investors.ups.com/_assets/ups/files/pages/ups/db/1149/description/UPS+ESG+Strategy+June+2021.pdf
2https://about.ups.com/content/dam/upsstories/assets/reporting/sustainability-2021/2020_UPS_TCFD_Report_081921.pdf
3https://www.cftc.gov/sites/default/files/2020-09/9-9-20%20Report%20of%20the%20Subcommittee%20on%20Climate- Related%20Market%20Risk% 20%20Managing%20Climate%20Risk%20in%20the%20U.S.%20Financial%20System%20for%20posting.pdf
4Id.
5https://www.eiu.com/n/global-economy-will-be-3-percent-smaller-by-2050-due-to-lack-of-climate-resilience.
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Shareowner Proposals

Lowered GDP will directly reduce returns to diversified investors,6 and a warming planet may create serious disruption costs that further threaten financial markets.7 By adopting a slower pace of mitigation, the Company is able to increase its margins and financial performance. But improved Company financial performance that comes at the expense of the environment and the economy is a bad trade for most Company shareholders, who are diversified and rely on broad economic growth to achieve their financial objectives.

This proposal asks for a report that analyzes the climate trade-offs the Company makes between financial return and the global economy, and how those trade-offs affect diversified shareholders. Such a report would not require precision: identifying areas where the Company is choosing not to accelerate decarbonization and analyzing how such choices manifest as costs or risks to diversified portfolios would help determine whether and when the Company should prioritize Paris alignment over financial returns.

Please vote for: Report on balancing climate measures and financial returns – Proposal 8

Response of UPS’s Board

UPS supports global efforts to mitigate the impact of climate change. Sustainability is an inherent part of UPS’s strategy and business operations. We believe that seeking to maximize shareholder value necessarily takes into account the interests of all stakeholders and our decarbonization efforts call for multi-year capital deployment based on effective solutions.

We take a comprehensive, global approach to reducing energy use and GHG emissions within our networks, as well as major portions of our value chain. As a global leader in logistics and supply chain solutions, we transport packages, facilitate international trade, and apply advanced technology to efficiently manage the world of business. In this role, we have an opportunity to reduce GHG emissions throughout the supply chains of many businesses, including by efficiently consolidating multiple shipments and otherwise reducing carbon intensity.

Commissioning this report is misguided and impracticable

Commissioning a report to extrapolate the extent to which Company decisions involving GHG emissions reductions prioritize financial performance over environmental costs and climate change risks and impact the global economy and overall market returns of diversified investors is misguided and impracticable. Among other things, it would require a variety of assumptions and estimates, and would necessarily be limited in quantifying the impact of one aspect of the Company’s operations on the global economy or on shareowners worldwide who hold diversified portfolios.

UPS already provides transparency, including comprehensive sustainability disclosures with regular updates on our progress

We disagree with the proponent’s assertion that the Company’s current sustainability reporting efforts are insufficient in this regard, or that they “only [ ] address the risk of climate change to the enterprise.” UPS provides transparency, including comprehensive sustainability disclosures with regular updates on our progress.

Each year, UPS reports company-wide emissions and tracks and discloses progress towards our targets. We publish comprehensive sustainability related disclosures showcasing our commitment to our investors, our customers, our employees and the communities in which we operate. These include disclosures under the Global Reporting Initiative (GRI), the Carbon Disclosure Project (CDP), the Sustainability Accounting Standards Board (SASB) and the Task Force on Climate-Related Financial Disclosures (TCFD) frameworks. UPS’s sustainability disclosures are extensive, targeted, and inclusive of Scope 1, 2, and 3 GHG emissions.

In light of the wealth of macroeconomic information and expertise presently available, we do not believe the requested report would significantly alter the mix of information available. Therefore, producing yet another report assessingdiscussing the feasibilityCompany’s sustainability practices is unnecessary, not an efficient use of integrating sustainability metrics into our senior executives’ compensation performance measures is unnecessaryresources, and not in the best interests of the Company or its shareowners. UPS’s senior executives already effectively manage for sustainability and are highly motivated

UPS continues to meet the Company’s sustainability goals. In fact, after we achieved many of our previous sustainability goals with a 2016 target date, we set more challenging goals around topics most important to the environment, our workforce, and communities around the world.

Achieving these new goals – including a goal to reduce our absolute greenhouse gas emissions by 12% across our global ground operations by 2025 – will not be easy. We are pushing ourselves with longer-term targets that support our sustainability vision and reinforcedemonstrate our commitment to create innovative solutions for global sustainability challenges. It is also important to note that these ambitious goals were set at a time whenreducing our carbon footprint would be expectedfor the benefit of all stakeholders

We believe everyone shares responsibility to increase dueimprove energy efficiency and reduce GHG emissions. UPS supports global efforts to mitigate the impact of climate change. Our optimized global smart logistics network, combined with our global GHG strategy, helps improve our efficiency and reduce our environmental impact. This technology and innovation driven strategy includes the following:

●Maintaining a leadership role in decarbonizing the transportation and logistics industries;
●Operational improvements through technology to create overall network and delivery efficiencies beyond miles/fuel that reduce our GHG footprint;

6 Ibid n. 2.

7 Supra, n.3

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●Expanding our fleet of alternative fuel and advanced technology vehicles, known as our Rolling Laboratory, in order to reduce the proportion of conventional fuels we use;
●Supporting the testing and development of alternative air solutions, including drone delivery and the use of SAF;
●Reducing conventional and increasing renewable energy use in our facilities;
●Providing customers with services that help them reduce their environmental impact; and
●Helping increase supplier awareness about GHG emissions and how to reduce them.

Preparing an additional report is unnecessary

For all of the foregoing reasons, the board believes producing this report is unnecessary, not an efficient use of resources and will only serve to benefit the limited interests of a small group of shareowners.

For these reasons, the board recommends that shareowners vote AGAINST this proposal.

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Shareowner Proposals

Proposal 9 — Shareowner Proposal Requesting the Board Prepare an Annual Report on Diversity and Inclusion

What am I voting on? Whether you want to require the board to prepare an additional report on diversity and inclusion.

Board’s Recommendation: Vote AGAINST this proposal because:

●UPS has taken significant steps to develop and maintain a diverse and inclusive workforce
●UPS’s commitment to diversity is reflected in our workforce demographics
●UPS already provides investors with significant diversity and inclusion data
●UPS has consistently been named a top company for diversity, equity, and inclusion
●The board provides independent oversight of UPS’s human capital management

Vote Required: Approval by a majority of the voting power of the shares present in person or by proxy.

Shareowner Proposal

As You Sow, 2020 Milvia St. Suite 500, Berkeley, CA 94704, and Booth Investments, LLC, has advised us that they intend to submit the proposal set forth below for consideration at the Annual Meeting on behalf of Booth Investments, LLC.

Whereas: Numerous studies by respected organizations such as The Wall Street Journal, Credit Suisse, Morgan Stanley, McKinsey, and BCG have pointed to the rapidmaterial benefits of a diverse workforce.

Companies should look to hire the best talent. However, Black and Latino applicants face recruitment challenges. Results of a meta-analysis study of 24 field experiments, dating back to 1990, found that, with identical resumes, White applicants receive an average of 36 percent more callbacks than Black applicants and 24 percent more callbacks than Latino applicants.”1

Promotion rates show how well diverse talent is nurtured at a company. Women and non-White employees experience “a broken rung” in their careers. For every 100 men who are promoted, only 86 women are promoted. Non-White women are particularly impacted, comprising 17 percent of the entry level workforce and only 4 percent of executives.2 Employees with the potential for advancement have a higher retention rate.3

Morgan Stanley has found that: “Employee retention that is above industry peer averages can indicate the presence of competitive advantage. This advantage may lead to higher levels of future profitability than past financial performance would indicate.”4 Companies with high employee satisfaction have also been linked to annualized outperformance of over two percent.5

The United Parcel Service Inc. (“UPS”) Board has stated, “UPS views diversity, equity, and inclusion as a strategic imperative that enables the company to attract and retain talented employees, foster innovation to enhance customer service, and bring strength and stability to businesses and communities.”6

However, UPS has released only retention and recruitment rates by gender. It has not shared sufficient recruitment, retention, or promotion data by race and ethnicity to allow investors to determine the effectiveness of its human capital management programs.

Between September 2020 and September 2021, the number of S&P 100 companies releasing recruitment rate data by gender, race and ethnicity increased by 234 percent, companies releasing retention rate data increased by 79 percent, and companies releasing promotion rate data increased by 379 percent.

Alaska Air Group, Boeing, Norfolk Southern Corp., and Uber all release more inclusion-focused data than UPS does. UPS is increasingly a laggard in its decision to continue to withhold these data sets. UPS’ Investors may wish to be particularly vigilant in their assessment of diversity programs at UPS, as the company has faced a number of allegations of discrimination on the basis of race and religion.

1https://hbr.org/2017/10/hiring-discrimination-against-black-americans-hasnt-declined-in-25-years
2https://wiw-report.s3.amazonaws.com/Women_in_the_Workplace_2021.pdf
3https://www.benefitspro.com/2019/04/17/promotions-play-a-key-role-in-employee-turnover/?slreturn=20210926165506
4https://www.morganstanley.com/im/publication/insights/articles/article_culturequantframework_us.pdf
5https://www.institutionalinvestor.com/article/b1tx0zzdhhnf5x/Want-to-Pick-the-Best-Stocks-Pick-the-Happiest-Companies?utm_medium=email&utm_campaign=The%20Essential%20II%20100721&utm_content=The%20Essential%20II%20100721%20CID_eb103a9e15359075f72a85f7ff534c79&utm_ source=CampaignMonitorEmail&utm_term=Want%20to%20Pick%20the%20Best%20Stocks%20Pick%20the%20Happiest%20Companies
6https://www.sec.gov/Archives/edgar/data/1090727/000120677421000883/ups3861781-def14a.htm
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Resolved: Shareholders request that UPS report to shareholders on the effectiveness of the Company’s diversity, equity, and inclusion efforts. The reporting should be done at reasonable expense, exclude proprietary information, and address outcomes using quantitative metrics for recruitment, retention, and promotion of employees, including data by gender, race, and ethnicity.

Supporting Statement: Quantitative data is sought so that investors can assess, understand, and compare the effectiveness of companies’ diversity, equity, and inclusion programs and apply this analysis to investors’ portfolio management and securities’ selection process.

Response of UPS’s Board

UPS is a global company - and is becoming even more so as much of the world’s economic and population growth continues to occur in e-commerce volume, which is requiring us to expand our physical networkemerging markets. With more than half a million employees around the world. Integrating sustainability metricsworld, UPS has a unique opportunity to effect positive change in the world through a commitment to diversity, equity and inclusion (DEI). We work closely with our customers, communities, suppliers and employees to advance a culture that embraces diversity, cultivates equity and inclusion, and fosters open participation from those with different ideas and perspectives. UPS views DEI as an imperative that enables the Company to attract and retain talented employees, foster innovation, and bring strength and stability to businesses and communities. Producing an additional special report on UPS’s DEI efforts is unnecessary, not an efficient use of resources, and therefore not in the best interests of the Company or its shareowners.

UPS has taken significant steps to develop and maintain a diverse and inclusive workforce

As one of the world’s largest employers, UPS employs people across all cultures, backgrounds, lifestyles and experiences. We provide opportunities for employees to connect, network and learn from others outside of normal work teams and with different backgrounds and experiences. One of the ways we do this is through providing unconscious bias and professionalism training for employees. We also sponsor employee hubs known as Business Resource Groups (BRGs).

The BRG program started as a pilot in 19 UPS locations in 2006 with Women’s Leadership Development (WLD) and has grown into incentive compensation plans will not improve sustainability performance or improve long-term shareowner value at UPS.more than 200 chapters worldwide across 11 categories: African American, Asian, Hispanic/Latino, Focus on Abilities, LGBT & Allies, Millennial, Multicultural, Veterans, Women in Operations, Working Parents, and WLD. Each BRG is supported by advisors and senior management sponsors.

We have also created the role of Chief Diversity, Equity and Inclusion Officer, a position on the company’s Executive Leadership Team, reporting directly to our CEO. This role is a significant step forward for UPS is widely recognized for its sustainability practices.
to build a more inclusive and equitable environment by furthering UPS’s programs and initiatives that infuse DEI into all aspects of the Company, and tracking and communicating progress toward DEI goals. This role also engages with UPS is committedsuppliers, customers and other external partners to sustainable business practices and transparent sustainability reporting. We published our first Corporate Sustainability Report in 2003, and we continue to lead the way withencourage the adoption of new sustainability reporting standards. Our strategy for driving sustainability improvementsmore proactive DEI efforts.

UPS’s commitment to diversity is explained in great detailreflected in our Corporate Sustainability Report (www.ups.com/sustainabilityreport). And we have been repeatedly recognized for our sustainability leadership, including the following:workforce demographics

●Listed

Our focus on the Dow Jones Sustainability World Index for the sixth consecutive yeardiversity and the Dow Jones Sustainability North America Index for the 14th straight year;


●Barron’s annual list of the 100 most sustainable companies ranked UPSinclusion is not “corporate puffery” as No. 5 in the industrials segment and 18th overall;

●Highlighted as a global leader for corporate climate action effortssuggested by the CDP (formerly known as the Carbon Disclosure Project) by being listed on the CDP Climate Change “A” List;

●Recognized by Forbes and JUST Capital’s annual “JUST 100” list for social responsibility for the third consecutive year;

●Chosen by CR Magazine as one of “100 Best Corporate Citizens” for the ninth consecutive year; and

●Named to the “Civic 50” for the fifth time for being one ofthis proposal. Starting from the most community-minded companies in the nation.

The Compensation Committee carefully considers the appropriate metrics for the Company’s incentive compensation programs.
The Compensation Committee works carefully with their independent advisorssenior levels at UPS, our commitment to set appropriate metrics for the Company’s incentive compensation programs. The Compensation Committee seeks to optimize the profitabilitydiversity and growth of our Company

through annual and long-term incentives which are consistent with our goals and which link the senior executive compensation to shareowner returns. This approach aligns the interests of senior executives more closely with those of our shareowners, promotes excellence in individual performance, and encourages teamwork among our employees. Integrating sustainability metrics into the process will not improve the already close alignment between senior executives and our shareowners’ interests.inclusion is evident:

●Board of Directors - 46% of our directors are women; and 31% are non-white
 As we build●Executive Leadership – 40% of our Executive Leadership Team members are women; and 30% are non-white, after giving effect to announced retirements
●Management – as disclosed in our most recent Sustainability Report, 37% of our entry level management positions, and 26% of our senior and middle management positions, are held by women; in addition, 50% of our entry level management positions, and 34% of senior and middle management positions, are held by non-white employees

In addition, our commitment to continued progress for representation of women globally is shown through our newly developed goal of 28% women representation in full-time management positions, by 2022.

UPS already provides investors with significant diversity and inclusion data

The workforce statistics described above are reported annually in our Sustainability Report. In addition, we publicly disclose our consolidated EEO-1 report that we file with the EEOC, which contains prior year gender, racial and ethnic composition of our US workforce by EEO-1 job category. We believe these disclosures provide our investors with the information needed to determine the effectiveness of our human capital management policies related to workplace diversity.

UPS has consistently been named a top company for diversity, equity, and inclusion

UPS has received numerous accolades recognizing our DEI efforts, including:

●For the smart logistics networksixth year in a row, UPS has been named to Forbes and JUST Capital’s annual JUST 100 corporate leadership list. UPS earned a ranking of No. 45 overall and No. 2 in Transportation
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●UPS was named to OMNIKAL’s Omni50 Award, which is the top 50 U.S. corporations who are awarding the most business to entrepreneurs from the growing culturally diverse marketplace
●UPS was ranked #22 on the 2022 Break the ceiling touch the sky® 101 Best Global Companies for Women in Leadership Index
●UPS was named as one of the future, we must stay disciplinedbest places to ensure these investments are made responsibly and sustainably, so our customers and our communities grow along with us.
work for LGBTQ employees, scoring a 100% on the Human Rights Campaign Foundation’s 2022 Corporate Equality Index

The board provides independent oversight of UPS’s human capital management

Our board is responsible for oversight of human capital matters, which responsibility it executes through a variety of methods and processes. The board’s oversight of these matters helps identify and mitigate risks and is part of the broader framework that guides how we attract, retain and develop a workforce that aligns with our values and strategies.

Management provides regular updates and leads discussions with the board and its committees around human capital, technology initiatives impacting the workforce, health and safety matters, employee survey results related to culture and other matters, hiring and retention, employee demographics, labor relations and contract negotiations, compensation and benefits, succession planning and employee training initiatives.

In 2021, the board delegated responsibility for oversight of performance and talent management, diversity, equity and inclusion, work culture and employee development and retention to the Compensation and Human Capital Committee. The Committee provides regular updates to the board on these matters. This oversight helps foster the Company’s continued progress and focus on human capital matters.

Producing another report is unnecessary

We believe our existing diversity and inclusion practices, and significant disclosures, provide meaningful information that allows investors to determine the effectiveness of our human capital management policies related to workplace diversity. Therefore, approval of this proposal would not result in an efficient use of resources and will only serve to benefit the limited interests of a small group of shareowners.

As a result, the board recommends that shareowners vote AGAINST this proposal.

 
David Abney UPS 2016 Corporate Sustainability Report   77

Sustainability performance already impacts executive compensation.
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Each year,Important Information About Voting at the Chief Executive Officer assesses the performance of our other executive officers and provides feedback to the Compensation Committee. In addition, the Compensation Committee evaluates the Chief Executive Officer’s performance on an annual basis and discusses the results of that assessment with the full Board of Directors. One area2022 Annual Meeting

What is included in these evaluations is whether the Companyproxy materials, and its operating regions contribute appropriately to the well-being of their communities.why am I receiving them?

The Compensation Committee considers the results of these assessments when approving annual incentive compensation for the executive officers, including the CEO. As a result, sustainability performance already impacts individual executive compensation in the annual incentive compensation process. The Compensation Committee does not believe that introducing additional sustainability metrics into the executive compensation evaluation is appropriate at this time.

Furthermore, the efficiency of our global logistics network drives both business success and environmental impact. Fuel costs represented a significant percentage of our total operating expense. Reducing the number of miles driven and time spent delivering a shipment can translate into energy savings and lower emissions. By improving the fuel and emissions efficiency of our business, we save costs and reduce environmental impact.

Even as business volume grows, we are seeking to slow the growth of fuel use and GHG emissions. This link between environmental impact and cost provides significant motivation to our senior executives to improve sustainability performance without the need to integrate additional sustainability metrics into our incentive compensation programs.


www.upsannualmeeting.com   

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Important Information About Voting at the 2019 Annual Meeting

What is included in the proxy materials, and why am I receiving them?

The proxy materials for our Annual Meeting include this Proxy Statement and notice of the 20192022 Annual Meeting, as well as our 20182021 Annual Report. If you received paper copies of these materials, you also received a proxy card or voting instruction form. We began distributing the Proxy Statement, Annual Meeting notice and proxy card, or aand Notice of Internet Availability of Proxy Materials (the “Notice”), on March 15, 2019.21, 2022.

When you vote, you appoint each of David P. AbneyCarol Tomé and Norman M. Brothers, Jr. to vote your shares at the Annual Meeting as you have instructed them. If a matter that is not on the form of proxy is voted on, then you appoint them to vote your shares in accordance with their best judgment. This allows your shares to be voted whether or not you attend the Annual Meeting.


Why did some shareowners receive a Notice of Internet Availability of Proxy Materials while others received a printed set of proxy materials?

Why did some shareowners receive a Notice of Internet Availability of Proxy Materials while others received a printed set of proxy materials?

We are allowed tomay furnish our proxy materials to requesting shareowners over the Internet, rather than by mailing printed copies, so long as we send them a Notice. The Notice tellsexplains how to access and review the Proxy Statement and Annual Report and vote over the Internet at www.proxyvote.com. If you received

the Notice and would like to receive printed proxy materials, follow the instructions in the Notice.

If you received printed proxy materials, you will notwon’t receive the Notice, but you may still access our proxy materials and submit your proxy over the Internet at www.proxyvote.com.


Can I receive future proxy materials and annual reports electronically?

Can I receive future proxy materials and annual reports electronically?

Yes. This Proxy Statement and the 20182021 Annual Report are available on our investor relations website at www.investors. ups.com. Instead of receiving a Notice or paper copies of the proxy materials in the mail, shareowners can elect to receive emails that provide links to our future annual reports and proxy materials on the Internet. Opting to receive your proxy materials electronically will reduce costs and the environmental impact of our annual meetings and will give you an automatic link to the proxy voting site.

If you are a shareowner of record and wish to enroll in the electronic proxy delivery service for future meetings, you may do so by going to www.icsdelivery.com/ups and following the prompts. If you hold class B shares through a bank or broker, please refer to your voting instruction form, the Notice or other information provided by your bank or broker for instructions on how to elect this option.


Who is entitled to vote?

Who is entitled to vote?

Holders of our class A common stock and our class B common stock at the close of business on March 11, 20199, 2022 are entitled to vote. This is referred to as the “Record Date”.Date.”

You must use your 16-digit control number found on your proxy card, voting instruction form or the Notice of Internet Availability you previously received to participate in the meeting and vote. A list of shareowners entitled to vote at the Annual Meeting will be available in electronic form at www.virtualshareholdermeeting. com/UPS2022 during the Annual Meeting on May 9,

2019 and5, 2022. It will also be accessible in electronic formduring regular business hours for ten days prior to the meeting at our principal place of business, 55  Glenlake Parkway, N.E., Atlanta, Georgia 30328, and at the offices30328.

To how many votes is each share of Morris, Nichols, Arsht & Tunnell, 1201 North Market Street, Wilmington, Delaware 19899, between the hours of 9:00 a.m. and 5:00 p.m.common stock entitled?


To how many votes is each share of common stock entitled?

Holders of class A common stock are entitled to 10 votes per share. Holders of class B common stock are entitled to one vote per share. On the Record Date, there were 163,551,033137,663,128 shares of our class A common stock and 696,626,771733,439,141 shares of our class B common stock outstanding and entitled to vote.

The voting rights of any shareowner or group of shareowners, other than any of our employee benefit plans, that beneficially owns shares representing more than 25% of our voting power are limited so that the shareowner or group may cast only one one-hundredth of a vote with respect to each vote in excess of 25% of the outstanding voting power.


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How do I vote?


If you hold class B shares through a bank or broker, please refer to your voting instruction form,

Important Information About Voting at the Notice or other information forwarded by your bank or broker to see which voting options are available to you. 2022 Annual Meeting

How do I vote before the Annual Meeting?

Shareowners of record may vote as described below:


●In Person.Online. You may vote in person if you attend the Annual Meeting.
●By Internet.You can vote in advance of the Annual Meeting via the Internet at www.proxyvote.com. Internet voting is available 24 hours a day and will be accessible until 11:59 p.m. Eastern Time on May 8, 2019.4, 2022.
●By Telephone.If you received a proxy card by mail, the toll-free telephone number is noted on your proxy card. Telephone voting is available 24 hours a day at 1-800-690-6903 and will be accessible until 11:59 p.m. Eastern Time on May 8, 2019.4, 2022.
●By Mail.If you received a proxy card by mail and choose to vote in advance by mail, simply mark your proxy card, date and sign it, and return it in the postage-paid envelope.

If you hold class A shares in the UPS Stock Fund in the UPS 401(k) Savings Plan, you may vote your shares overthrough the Internet, by telephone, or by mail or in person at the Annual Meeting as if you were a registered shareowner. To allow sufficient time for voting by the Plan trustee, your voting instructions must be received by 11:59 Eastern Time on May 6, 2019.

2, 2022.

Even if you plan to attend the Annual Meeting, we encourage you to vote in advance. If you vote bythrough the Internet or by telephone, you do not need to return your proxy card.

The method you use to vote in advance will not limit your right to vote atonline during the Annual Meeting if you decide to attend in person. Written ballots will be passed out to anyone who wants to vote at the Annual Meeting. If you hold your shares through a bank, broker or other holder of record, you must obtain a proxy, executed in your favor, from the bank, broker or other holder of record to be able to vote at the Annual Meeting.

BENEFICIAL SHAREOWNERSSHAREOWNER VOTING OPTIONS

If you are a beneficial owner, you will receive instructions from your bank, broker or other nominee that you must follow in order for your shares to be voted. Many of these institutions offer telephone and Internet voting. If your voting instruction form or Notice indicates that you may vote these shares through www.proxyvote.com, you will need the 16-digit control number indicated on that form or Notice. If you did not receive a 16-digit control number, please contact your bank, broker or other nominee at least five days before the Annual Meeting and obtain a legal proxy to be able to participate in or vote at the Annual Meeting.



Can I revoke my proxy or change my vote?

Can I revoke my proxy or change my vote?


Shareowners of record may revoke their proxy or change their vote at any time before the polls close at the Annual Meeting by:

●submitting a subsequent proxy bythrough the Internet, by telephone or by mail with a later date;
●sending a written notice to our Corporate Secretary at 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328; or
●voting in person atonline during the Annual Meeting.Meeting using the 16-digit code.

If you hold class B shares through a bank or broker, please refer to your proxy card, the Notice or other information forwarded by your bank or broker to see how you can revoke your proxy and change your vote.



vote before the Annual Meeting.

Beneficial shareowners that attend the Annual Meeting using the 16-digit code they received as described below will also be able to change their vote by voting online at any time before the polls close at the Annual Meeting.

How many votes do you need to hold the Annual Meeting?

The presence, in persononline or by proxy, of the holders of a majority of the votes entitled to be cast at the Annual Meeting will constitute a quorum. A quorum is necessary to hold the Annual Meeting and conduct business. If a quorum is not present online, the Annual Meeting may be adjourned from time to time until a quorum is present.

What happens if I do not provide voting instructions or if a nominee is unable to stand for election?

What happens if I do not provide voting instructions or if a nominee is unable to stand for election?


If you sign and return a proxy but do not provide voting instructions, your shares will be voted as recommended by the board.

If a director nominee is unable to stand for election, the board may either reduce the number of directors that serve on the board or designate a substitute nominee. If the board designates

a substitute nominee, shares represented by proxies voted for the nominee who is unable to stand for election will be voted for the substitute nominee.

Will my shares be voted if I do not vote through the Internet, by telephone or by signing and returning my proxy card?

Will my shares be voted if I do not vote by Internet, by telephone or by signing and returning my proxy card?


If you are a shareowner of record of class A shares or class B shares and you do not vote, then your shares will not count in deciding the matters presented for shareowner consideration at the Annual Meeting.

If your class A shares are held in the UPS Stock Fund in the UPS 401(k) Savings Plan and you do not vote by 11:59 p.m. Eastern Time on May 6, 2019,2, 2022, then the Plan trustee will vote your shares

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for each proposal in the same proportion as the shares held under the Plan for which voting instructions were received.


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If your class B shares are held in street name through a bank or broker, your bank or broker may vote your class B shares under certain limited circumstances if you do not provide voting instructions before the Annual Meeting. These circumstances include voting your shares on “routine matters” as defined by NYSE rules related to voting by banks and brokers, such as the ratification of the appointment of our independent registered public accounting firm described in this Proxy Statement. With respect to this proposal, therefore, if you do not vote your shares, your bank or broker may vote your shares on your behalf or leave your shares unvoted.

The remaining proposals are not considered “routine matters” under NYSE rules relating to voting by banks and brokers. When a proposal is not a routine matter and the brokerage firm has not received voting instructions, the brokerage firm cannot vote the shares on that proposal. Shares that banks and brokerage firms are not authorized to vote are called “broker non-votes.” Broker non-votes that are represented at the Annual Meeting will be counted for purposes of establishing a quorum but not for determining the number of shares voted for or against thea non-routine matter.

We encourage you to provide instructions to your bank or brokerage firm by voting your proxy so that your shares will be voted at the Annual Meeting in accordance with your wishes.


What is the vote required for each proposal to pass, and what is the effect of abstentions and uninstructed shares on each of the proposals?

What is the vote required for each proposal to pass, and what is the effect of abstentions and uninstructed shares on each of the proposals?


Our Bylaws provide for majority voting in uncontested director elections. Therefore, a nominee will only be elected if the number of votes cast for the nominee’s election is greater than the number of votes cast against that nominee. See “Corporate Governance – Majority Voting and Director Resignation Policy” for an explanation of what would happen if more votes are cast against a nominee than for the nominee. Abstentions are not considered votes cast for or against the nominee. For each other
proposal to pass, in accordance with our Bylaws, the proposal must receive the affirmative vote of a majority of the voting power of the shares present in person or by proxy at the Annual Meeting and entitled to vote.

The following table summarizes the votes required for each proposal to pass and the effect of abstentions and uninstructed shares on each proposal.



Proposal
Number		 Item 

Votes Required for
ApprovalApproval

Abstentions     

Abstentions

Uninstructed
shares

1.1.Election of 1213 directorsMajority of votes castNo effectNo effect
2.2.Ratification of independent registered public accounting firmAdvisory vote on executive compensationMajority of the voting power of the shares present in person or by proxyrepresented at the meetingSame asvotes againstDiscretionary voting by broker permittedNo effect
3. - 5.3.Shareowner proposalsRatification of independent registered public accounting firmMajority of the voting power of the shares present in person or by proxyrepresented at the meetingSame as votes againstDiscretionary voting by broker permitted
4. - 9.Shareowner proposalsMajority of the voting power of the shares represented at the meetingSame as votes againstNo effect

If an incumbent director nominee doesHow do I attend and vote at the Annual Meeting?

The Annual Meeting will take place on May 5, 2022, at 8:00 a.m. Eastern Time. There will not receivebe a physical location for the requisiteAnnual Meeting and you will not be able to attend in person. You or your proxyholder can participate, vote heand examine our list of shareowners entitled to vote at the Annual Meeting by visiting www.virtualshareholdermeeting.com/UPS2022 and entering the 16-digit control number included in your Notice, on your proxy card, or she must offer to resign fromon the board, and the Board of Directors, through a process managed by the Nominating and Corporate Governance Committee, will decide whether to accept the offer to resign.

What do I need to bring to attend the Annual Meeting in person?


You need proof ofinstructions that accompanied your share ownership (such as a recent brokerage statement or a letter from your broker showing that you owned shares of United Parcel Service, Inc. common stock as of the Record Date) and a form of government-issued photo
identification.proxy materials. If you are a beneficial shareowner, see the information relating to beneficial shareowners above under “How do not have proof of ownership and valid photo identification, youI vote before the Annual Meeting” for obtaining your 16-digit control number. You may not be admittedbegin to log into the meeting platform at 7:45 a.m. Eastern Time on Thursday, May 5, 2022.

How can I submit a question at or prior to the Annual Meeting. All bags, briefcasesMeeting?

If you wish to submit a question prior to the Annual Meeting, you may do so by visiting proxyvote.com and packagesentering your 16-digit control number, then clicking “Submit a Question for Management.”

We have designed the format of the Annual Meeting so that shareowners have the same rights and opportunities as they would have had at a physical meeting. To this end, shareowners will be held at registration and will not be allowed inable to submit questions during the Annual Meeting.



If you wish to submit a question during the Annual Meeting, you may do so by logging into www.virtualshareholdermeeting.com/UPS2022 with your 16-digit control number, as described above under “How do I attend and vote at the Annual Meeting?” We will answer questions and address comments relevant to meeting matters that comply with the meeting rules of conduct during the Annual Meeting, subject to time constraints. We will summarize multiple questions submitted on the same topic. We will make every effort to respond to all appropriate questions during the meeting, as time permits.

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Important Information About Voting at the 2022 Annual Meeting

If there are matters of individual concern to a shareowner and not of general concern to all shareowners, or if a question posed was not otherwise answered, we provide an opportunity for shareowners to contact us separately after the Annual Meeting at www.investors.ups.com.

What if I have technical difficulties or trouble accessing the virtual Annual Meeting?

For help with technical difficulties on the meeting day you can call 1-800-586-1548 (toll free) or 303-562-9288 (international) for assistance. Technical support will be available starting at 7:00 a.m. Eastern Time and until the meeting has finished.

What does it mean if I receive more than one Notice, proxy card or voting instruction form?

This means that your shares are registered in different names or are held in more than one account. To ensure that all shares are voted, please vote each account by using one of the voting methods as described above.

When and where will I be able to find the voting results?

When and where will I be able to find the voting results?


You can find the official results of the voting at the Annual Meeting in our Current Report on Form 8-K that we will file with the SEC within four business days after the Annual Meeting. If the
official results are not available at that time, we will provide preliminary voting results in the Form 8-K and will provide the final results in an amendment as soon as they become available.

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Other Information for Shareowners

Other Information for Shareowners

Solicitation of Proxies

We will pay our costs of soliciting proxies. Directors, officers and other employees, acting without special compensation, may solicit proxies by mail, email, in person or by telephone. We will reimburse brokers, fiduciaries, custodians and other nominees for out-of-pocket expenses incurred in sending our proxy materials

and Notice to, and obtaining voting instructions relating to the proxy materials and Notice from, shareowners. In addition, we have retained Georgeson, Inc. to assist in the solicitation of proxies for the Annual Meeting at a fee of approximately $10,000$16,000 plus associated costs and expenses.

Eliminating Duplicative Proxy Materials

We have adopted a procedure approved by the SEC called “householding” under which multiple shareowners who share the same last name and address and do not participate in electronic delivery will receive only one copy of the annual proxy materials or Notice unless we receive contrary instructions from one or more of the shareowners. If you wish to opt out of householding and continue to receive multiple copies of the proxy materials or Notice at the same address, or if you have

previously opted out and wish to participate in householding, you may do so by notifying us in writing or by telephone at: UPS Investor Relations, 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328, (404) 828-6059, and we will promptly deliver the requested materials. You also may request additional copies of the proxy materials or Notice by notifying us in writing or by telephone at the same address or telephone number.

Proxy Access,Submission of Shareowner Proposals and Director Nominations

Proposals for Director atInclusion in the 2020Proxy Statement for the 2023 Annual Meeting

Shareowners who, in accordance with Rule 14a-8 under the Securities Exchange Act of 1934, wish to present proposals for inclusion in the proxy materials to be distributed in connection with the 20202023 Annual Meeting of Shareowners must submit their proposals so that they are received by our Corporate Secretary at 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328 no later than the close of business6:00 p.m. Eastern Time on November 16, 2019.21, 2022. Any proposal will need to comply with SEC regulations regarding the inclusion of shareowner proposals in Company-sponsored proxy material.

As the rules of the SEC make clear, simply submitting a proposal does not guarantee its inclusion.

Director Nominations for Inclusion in the Proxy Statement for the 2023 Annual Meeting

Shareowner notice of the intent to use proxy access must be delivered by a shareowner to the Corporate Secretary at 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328 not later than the close of business on the 120th day, nor earlier than the close of business6:00 p.m. Eastern Time on the 150th day, prior to the first anniversary of the date the definitive proxy statement was first released to shareowners in connection with the preceding year’s annual meeting of shareowners; provided, however, that in the event the annual meeting is more than 30 days before or after the anniversary of the preceding year’s annual meeting, or if no annual meeting was held in the preceding year, to be timely, the notice must be so delivered not earlier than the close of business on the 150th day prior to such annual meeting, and not later than the close of business on the later of the 120th day prior to such annual meeting, or the 10th day following the day on which public announcement of the date of such meeting is first made

by the Company. Therefore, any notice of the intent to use proxy access must be delivered to our Corporate Secretary no later than the close of business6:00 p.m. Eastern Time on November 15, 201921, 2022 and no earlier than the close of business6:00 p.m. Eastern Time on October 17, 2019.22, 2022. However, if the date of our 20202023 Annual Meeting occurs more than 30 days before or 30 days after May 9, 2020,5, 2023, the anniversary of the 20192022 Annual Meeting, a shareowner notice will be timely if it is delivered to our Corporate Secretary by the later of (a) the close of business on the 120th day prior to the date of the 20202023 Annual Meeting and (b) the 10th day following the day on which we first make a public announcement of the date of the 20202023 Annual Meeting. As our Bylaws make clear, simply submitting a nomination does not guarantee its inclusion.

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Other Information for Shareowners

Other Proposals or Director Nominations for Presentation at the 2023 Annual Meeting

Shareowners who wish to propose business or nominate persons for election to the Board of Directors at the 20202023 Annual Meeting of Shareowners, and the proposal or nomination is not intended to be included in our 20202023 proxy materials, must provide a notice of shareowner business or nomination in accordance with Article II, Section 10 of our Bylaws. In order to be properly brought before the 20202023 Annual Meeting of Shareowners, Article II, Section 10 of our Bylaws requires that a notice of a matter the shareowner wishes to present (other than a matter brought pursuant to Rule 14a-8), or the person or persons the shareowner wishes to nominate as a director, must be received by our Corporate Secretary not later than the close of business on the 90th day, nor earlier than the close of business on the 150th day, prior to the first anniversary of the preceding year’s


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annual meeting. Therefore, any notice intended to be given for a proposal or nomination not intended to be included in our 20202023 proxy materials must be received by our Corporate Secretary at 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328 no later than the close of business6:00 p.m. Eastern Time on February 9, 2020,4, 2023, and no earlier than the close of business on December 11, 2019.6, 2022. However, if the date of our 20202023 Annual Meeting occurs more than 30 days before or 30 days after May 9, 2020,5, 2023, the anniversary of the 20192022 Annual Meeting, a shareowner notice will be timely if it is delivered to our Corporate Secretary by the later of (a) the close of business
on the 90th day prior to the date of the 20202023 Annual Meeting and (b) the 10th day following the day on which we first make a public announcement of the date of the 20202023 Annual Meeting.

To be in proper form, a shareowner’s notice must be a proper subject for shareowner action at the Annual Meeting and must include the specified information concerning the proposal or nominee as described in Section 10 of our Bylaws. Our Bylaws are available on the governance page of our investor relations website at www.investors.ups.com.


In addition, a shareowner who intends to solicit proxies pursuant to Rule 14a-19 in support of nominees submitted under these advance notice provisions of the Bylaws must provide notice to the Secretary of the Company regarding such intent no later than March 6, 2023.

20182021 Annual Report on Form 10-K

A copy of our 20182021 Annual Report on Form 10-K, including financial statements, as filed with the SEC may be obtained without charge upon written request to: Corporate Secretary, 55 Glenlake Parkway, N.E., Atlanta, Georgia 30328. It is also available on our investor relations website at www.investors.ups.com.

Other Business

Our Board of Directors is not aware of any business to be conducted at the Annual Meeting other than the proposals described in this Proxy Statement. Should any other matter requiring a vote of the shareowners arise, the persons named in the accompanying proxy card will vote in accordance with their

best judgment. A proxy granted by a shareowner in connection with the Annual Meeting will give discretionary authority to the named proxy holders to vote on any such matters that are properly presented at the Annual Meeting, subject to SEC rules.

This proxy statement contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than those of current or historical fact, and all statements accompanied by terms such as “will,” “believe,” “project,” “expect,” “estimate,” “assume,” “intend,” “anticipate,” “target,” “plan” and similar terms, are intended to be forward-looking statements. Forward-looking statements are made subject to the safe harbor provisions of the federal securities laws pursuant to Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements relate to our intent, belief and current expectations about our strategic direction, prospects and future results, and give our current expectations or forecasts of future events; they do not relate strictly to historical or current facts.

Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations or anticipated results. These risks and uncertainties include, but are not limited to, those described in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021, filed with the SEC and being made available with this proxy statement, and may also be described from time to time in our future reports filed with the SEC. You should consider the limitations on, and risks associated with, forward-looking statements and not unduly rely on the accuracy of predictions contained in such forward-looking statements. Management believes that these forward-looking statements are reasonable as and when made. However, caution should be taken not to place undue reliance on any such forward-looking statements because such statements speak only as of the date when made. We do not undertake any obligation to update forward-looking statements to reflect events, circumstances, changes in expectations or the occurrence of unanticipated events after the date of those statements.

Website links included in this Proxy Statement are for convenience only. The content of any website links is not incorporated herein and does not constitute a part of this Proxy Statement.

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ANNUAL MEETING OF SHAREOWNERS

Thursday, May 5, 2022, 8:00 a.m. Eastern Time

www.virtualshareholdermeeting.com/UPS2022

ANNUAL MEETING OF SHAREOWNERS


Thursday, May 9, 2019, 8:00 a.m. Eastern Time

Hotel du Pont
11th and Market Streets
Wilmington, Delaware 19801

Table of Contents


UNITED PARCEL SERVICE, INC.
INVESTOR RELATIONS B1F7
55 GLENLAKE PARKWAY, N.E.
ATLANTA, GA 30328

UNITED PARCEL SERVICE, INC.
INVESTOR RELATIONS B1F7
55 GLENLAKE PARKWAY, N.E.
ATLANTA, GA 30328

VOTE BY INTERNET

Before The Meeting - Go to SCAN TO
VIEW MATERIALS &VOTEwww.proxyvote.com or scan the QR Barcode above

Use the Internet to transmit your voting instructions and for electronic delivery of information. Vote by 11:59 P.M. Eastern Time on May 4, 2022. Shares held in the UPS Stock Fund in the UPS 401(k) Savings Plan must be voted by 11:59 P.M. Eastern Time on May 2, 2022. Have your proxy card in hand when you access the website and follow the instructions to obtain your records and to create an electronic voting instruction form.

During The Meeting - Go to www.virtualshareholdermeeting.com/UPS2022

You may attend the meeting via the Internet and vote during the meeting. Have the information that is printed in the box marked by the arrow available and follow the instructions.

VOTE BY PHONE - 1-800-690-6903

Use any touch-tone telephone to transmit your voting instructions. Vote by 11:59 P.M. Eastern Time on May 4, 2022. Shares held in the UPS Stock Fund in the UPS 401(k) Savings Plan must be voted by 11:59 P.M. Eastern Time on May 2, 2022. Have your proxy card in hand when you call and follow the instructions.

VOTE BY MAIL

Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.

If you vote by Internet or phone, you do not need to return this card.

TO VOTE, BY INTERNET -www.proxyvote.com or scan the QR Barcode above
Use the Internet to transmit your voting instructions and for electronic delivery of information. Vote by 11:59 P.M. Eastern Time on May 8, 2019. Shares held in the UPS Stock Fund in the UPS 401(k) Savings Plan must be voted by 11:59 P.M. Eastern Time on May 6, 2019. Have your proxy card in hand when you access the website and follow the instructions to obtain your records and to create an electronic voting instruction form.

VOTE BY PHONE - 1-800-690-6903
Use any touch-tone telephone to transmit your voting instructions. Vote by 11:59 P.M. Eastern Time on May 8, 2019. Shares held in the UPS Stock Fund in the UPS 401(k) Savings Plan must be voted by 11:59 P.M. Eastern Time on May 6, 2019. Have your proxy card in hand when you call and follow the instructions.MARK BLOCKS BELOW IN BLUE OR BLACK INK:

VOTE BY MAIL
Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to United Parcel Service, Inc., c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717.

ELECTRONIC DELIVERY OF FUTURE SHAREOWNER COMMUNICATIONS

If you would like to reduce the costs incurred by United Parcel Service, Inc. in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate your agreement to receive or access shareowner communications electronically in the future.

If you vote by Internet or phone, you do not need to return this card.








TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:D71215-P70092-Z82103
E58253-P17788-Z74057KEEP THIS PORTION FOR YOUR RECORDS
DETACH AND RETURN THIS PORTION ONLY
THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.DETACH AND RETURN THIS PORTION ONLY

UNITED PARCEL SERVICE, INC.

 

The board of directors recommends you voteFOR all 1213 director nominees.

 
1.To elect 1213 directors nominated by the board of directors to serve until the 20202023 annual meeting of shareowners.
Nominees:shareowners or their earlier resignation, removal or retirement. For AgainstAbstain
 
1a)Nominees: David P. AbneyForAgainst☐☐☐Abstain
 1a)Carol B. Toméooo
1b)Rodney C. Adkins☐oo☐☐o
 
1c)Eva C. Borattoooo
1d)Michael J. Burns☐oo☐☐o
 
1d)1e)Wayne M. Hewettooo
1f)Angela Hwangooo
1g)Kate E. Johnsonooo
1h)William R. Johnson☐oo☐☐o
 
1e)1i)Ann M. Livermore☐oo☐☐o
 
1f)Rudy H.P. Markham☐☐☐
 
1g)1j)Franck J. Moison☐oo☐☐o
 
1h)Clark T. Randt, Jr.☐☐☐
 
1i)1k)Christiana Smith Shi☐oo☐☐o
 
1j)John T. Stankey☐☐☐
 1l)Russell Stokesoo
1k)Carol B. Tomé☐☐☐o
 
1l)Kevin M. Warsh☐☐☐
 1m)
Kevin Warsh ooo
    


 
  


 
The board of directors recommends you voteFOR the following proposal:proposals:ForAgainstAbstain
 ForAgainstAbstain
 
2.To approve on an advisory basis named executive officer compensation.ooo
3.To ratify the appointment of Deloitte & Touche LLP as UPS'sUPS’s independent registered public accounting firm for the year ending December 31, 2019.2022.ooo ☐☐☐
 
The board of directors recommends you voteAGAINST the following shareowner proposal:proposals:
 
3.4.To prepare an annual report on lobbying activities.o☐oo☐☐
 
The board5.To prepare a report on alignment of directors recommends you voteAGAINSTlobbying activities with the following shareowner proposal:Paris Climate Agreement.ooo
 
4.6.To reduce the voting power of UPS class A stock from 10 votes per share to one vote per share.o☐oo☐☐
 
The board7.To require adoption of directors recommends you voteAGAINST the following shareowner proposal:independently verified science-based greenhouse gas emissions reduction targets.ooo
 
5.8.To prepare a report to assess the integration of sustainability metrics into executive compensation.on balancing climate measures and financial returns.o☐oo☐☐
9.To prepare an annual report assessing UPS’s diversity and inclusion.ooo
 
In their discretion upon such other matters as may properly come before the meeting or any adjournments or postponements thereof.
 
 


 
YesNo
Please indicate if you plan to attend this meeting.☐☐



Please sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor, administrator, or other fiduciary, please give full title as such. Joint owners should each sign personally. All holders must sign. If a corporation or partnership, please sign in full corporate or partnership name by authorized officer.


 
Signature [PLEASE SIGN WITHIN BOX]    Date
   
Signature [PLEASE SIGN WITHIN BOX](Joint Owners)                     Date

Signature (Joint Owners)Date






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Annual Meeting of Shareowners


Thursday, May 9, 2019,5, 2022, 8:00 a.m. (Eastern Time)Eastern Time
The meeting will be held online at:
www.virtualshareholdermeeting.com/UPS2022

Hotel du Pont

11thYou or your proxyholder can participate, vote and Market Streetsexamine a list of shareowners at the
Virtual Annual Meeting by entering your unique control number.

Wilmington, Delaware 19801


Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:
The Notice and Proxy Statement and Annual Report are available at www.proxyvote.com.





E58254-P17788-Z74057
D71216-P70092-Z82103

UNITED PARCEL SERVICE, INC.
This proxy is solicited by the Board of Directors
for the Annual Meeting of Shareowners to be held on May 9, 20195, 2022

I hereby appoint DAVID P. ABNEYCAROL B. TOMÉ and NORMAN M. BROTHERS, JR., or either of them, with power of substitution, as attorneys and proxies to vote all of the shares of stock outstanding in my name as of March 11, 2019,9, 2022, at the Annual Meeting of Shareowners of United Parcel Service, Inc. to be held online at the Hotel du Pont, 11th and Market Streets, Wilmington, Delaware 19801,www.virtualshareholdermeeting.com/UPS2022 on May 9, 2019,5, 2022, and at any or all adjournments or postponements thereof, as stated on the reverse side and with discretionary authority on all other matters that properly come before the meeting. If this proxy is signed and returned but no direction is made, this proxy will be voted as the Board of Directors recommends and in the discretion of the proxies on all other matters that may properly come before the meeting.

If my shares are held in the UPS Stock Fund in the UPS 401(k) Savings Plan, I direct the Trustee to vote the stock in the manner stated on the reverse side. If this proxy is signed and returned but no direction is made, the Trustee will vote the shares as the Board of Directors recommends and in the discretion of the Trustee on all other matters that may properly come before the meeting. If this card is not returned by end of business11:59 P.M. Eastern Time on May 6, 20192, 2022 or is returned unsigned, then the Trustee will vote the shares in the same proportion as the shares for which voting instructions are received from other participants. The results of the voting will be held in strict confidence by the Trustee.

(CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE)