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. )
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| Preliminary Proxy Statement |
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| Definitive Proxy Statement |
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PPG Industries, Inc. | ||
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A MESSAGE FROM PPG’S |
In 2022, PPG’s more than 50,000 employees across the world stayed focused on being a trusted partner for our customers, delivering results for our shareholders, and supporting the communities where we operate around the world.
Despite challenges that included historic cost inflation, geopolitical issues, COVID-19-related impacts, supply disruptions and labor shortages, PPG achieved record full-year 2022 reported net sales of approximately $17.7 billion, up 5% compared with 2021. Organic sales were higher by 8%, driven by higher selling prices.
Strategically, PPG continued to grow and strengthen the company, successfully integrating five recent acquisitions that have annualized sales of about $1.7 billion.
The success of the team’s work throughout the year has enabled PPG to continue to reward shareholders, paying $570 million in dividends for the year. PPG has raised its annual dividend payout for 51 consecutive years and has paid uninterrupted annual dividends for 123 years. PPG also continues to have strong financial flexibility with cash and short-term investments totaling approximately $1.2 billion at year end.
Throughout 2022, PPG took actions to further advance its environmental, social and governance (ESG) commitments. These included strengthening the governance and Board oversight of the company’s ESG program. In addition, PPG remained focused on diversity, equity and inclusion (DE&I), publishing the company’s first DE&I report. At the Board level, we strengthened our governance, receiving shareholder approval to declassify the Board and remove the supermajority voting requirements from our Articles of Incorporation and Bylaws.
On behalf of the Board of Directors, it is my pleasure to invite you to PPG’s 2023 Annual Meeting of Shareholders, which is to be held at 11:00 a.m., Eastern Time, on Thursday, April 20, 2023, via live audio webcast at https://www.cesonlineservices.com/ppg23_vm. We encourage you to read the attached Proxy Statement and vote on the included proposals.
We thank you for your continued support of and investment in PPG.
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Hugh Grant PPG Board of Directors |
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NOTICE OF ANNUAL MEETINGOF SHAREHOLDERS
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WHEN | April | |
WHERE |
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WHAT | 1. | To elect as directors the |
| 2. | To vote on a nonbinding resolution to approve the compensation of the Company’s named executive officers on an advisory basis; |
| 3. | To vote on the frequency of future advisory votes on executive compensation on an |
| 4. | To ratify the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for |
| 5. | To vote on a shareholder proposal to adopt a policy requiring an independent board chair, if properly presented; and |
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| To transact any other business that may properly come before the meeting. |
RECORD DATE | February | |
ANNUAL MEETING ADMISSION |
https://www.cesonlineservices.com/ppg23_vm You will not be able to attend the Annual Meeting in person. If you plan to participate in the virtual meeting, you will | |
PLEASE VOTE
Please know that your vote is very important to us, and we encourage you to vote promptly. Whether or not you expect to attend the virtual Annual Meeting, in person, please vote via the Internet or telephone, or by paper proxy card or vote instruction form, which you should complete, sign and return by mail, so that your shares may be voted.
Beneficial Shareholders (Shares are held in a stock brokerage account or by a bank or other holder of record)
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Internet | Mobile App | Phone | Mail | In Person |
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Registered Shareholders and Employee Savings Plan Participants (Shares are registered in your name with PPG’s transfer agent or held in a Company-sponsored employee savings plan) | |||||
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| Joseph R. Gette and Secretary | ||||
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PROXY SUMMARYFORWARD-LOOKING STATEMENTS
This summary highlightsProxy Statement includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our compensation program; sustainability; culture; diversity, equity and inclusion; community engagement; and related goals, commitments and strategies. These statements involve risks and uncertainties. Our actual future results, including the achievement of our targets, goals or commitments, could differ materially from our projected results as the result of changes in circumstances, assumptions not being realized, or other risks, uncertainties and factors, including due to the risks and uncertainties that are discussed in our most recently filed periodic reports on Form 10-K and Form 10-Q, current reports on Form 8-K and subsequent filings. We assume no obligation to update any forward-looking statements or information, contained inwhich speak as of the date of this Proxy Statement. It does not contain all of the information you should consider. You should read the entireThis Proxy Statement carefully before voting. Please seeincludes several website addresses and references to additional materials found on those websites. These websites and materials are not incorporated herein by reference.
PROXY STATEMENT SUMMARY
About the General Matters section beginning on page 70 for important information about proxy materials, voting, the Annual Meeting Company documents and communications.
TIME AND PLACE OF THE ANNUAL MEETING
Thursday, April 19, 2018
11:00 AM
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| 2023 Proxy Statement 5 |
Governance Highlights
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Independence | 10 of 12 directors are independent | |
All Board committee members are independent | ||
Independent directors regularly meet without management present | ||
Strong independent Lead Director with clearly defined duties that are publicly disclosed | ||
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Accountability | Majority voting in uncontested elections | |
Annual Board and committee self-evaluations | ||
Board oversight of Company strategy | ||
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Shareholder | No dual class structure; each shareholder gets one vote per share | |
Proxy access right with market terms | ||
Extensive shareholder engagement | ||
No poison pill | ||
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Financial Highlights
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NET SALES | | | ADJUSTED EARNINGS PER DILUTED SHARE* | | | OPERATING CASH FLOW | |||
| Up 5% | | | | $6.05 | | | | ~$1 Billion |
*From continuing operations. See reconciliation in Appendix A
Executive Compensation Highlights
Executive compensation is based on our pay-for-performance philosophy, which emphasizes executive performance measures that correlate closely with the achievement of both shorter-term performance objectives and longer-term shareholder value creation.
Compensation Component | Overview | Objectives |
Base Salary | Fixed compensation that is | Maintain parity with |
Annual Incentive Awards | Variable compensation that is based on Company, business, and individual performance | Incentivize executive officers to achieve our short-term performance objectives |
Long-Term, Equity-Based Incentives | Variable compensation that is based solely on Company performance | Retain our executive officers, align their financial interests with the interests of |
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EXECUTIVE TARGET PAY MIX
Executive compensation is based on our pay-for-performance philosophy, which emphasizes executive performance measures that correlate closely with the achievement of both shorter-term performance objectives and longer-term shareholder value creation. To this end, a substantial portion of our executives’ annual and long-term compensation is performance-based, with the payment being contingent on the achievement of performance goals.
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Chief Executive Officer Pay Mix | Average Other Named Executive Officer Pay Mix | |
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CHOOSE ELECTRONIC DELIVERY
We encourage PPG shareholders to voluntarily elect to receive future proxy and annual report materials electronically to help contribute to our sustainability efforts. If you are a registered shareholder, please visit www.cesvote.com for instructions. Beneficial shareholders can opt for e-delivery at www.proxyvote.com or by contacting their stockbroker or other nominee.
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| Combined with your adoption of Electronic Delivery of Proxy Materials, and the elimination of approximately 74,336 sets of proxy materials, we can ideally reduce the impact on the environment by: | | ||||
| using approximately 151 fewer tons of wood, or 906 fewer trees (14.1 acres of forest) | | saving approximately 810,000 gallons of water, or the equivalent of filling approximately 37 swimming pools | | ||
| using approximately 965 million fewer BTUs, or the equivalent of the amount of energy used by 1,150 residential refrigerators for one full year | | using approximately 680,000 fewer pounds of greenhouse gases, including CO2, or the equivalent of 61.8 automobiles running for one year | | ||
| eliminating approximately 44,600 pounds of solid waste | | reducing hazardous air pollutants by approximately 60.4 pounds | | ||
| Environmental impact estimates were calculated using the Environmental Paper Network Paper Calculator. For more information visit www.papercalculator.org. | | ||||
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| 2023 Proxy Statement 7 |
SUSTAINABILITY, CULTURE AND HUMAN RIGHTS
Our Culture |
At PPG, we aim to champion all employees, empowering them to be their authentic selves and allowing everyone to reach their full potential. In 2022, we achieved several key milestones, including:
● | Launched our inaugural Diversity, Equity & Inclusion Report. |
● | Earned a score of 100 on the 2022 DISABILITY EQUALITY INDEX®. |
● | Formally scaled a global recruiting process for non-frontline roles by using labor market data to build diverse candidate slates for recruitment. |
● | Launched a new leadership competency model, The PPG Way to Lead, to connect our behaviors to our values, providing clarity and consistency for what great leadership looks like at PPG. |
● | Created a safe forum for conversations and storytelling around bias, discrimination and inclusion at a personal level by launching our Listen & Learn sessions. |
● | Our eight Employee Resource Networks (“ERNs”) have grown to more than 7,550 members and are active in more than 60 countries. Through 2022, there were more than 22,000 participants in more than 30 ERN-sponsored events. |
● | Expanded our Employee Assistance Program to include all |
Our Communities |
At PPG, our community engagement supports our purpose to protect and beautify the world. Our efforts are focused on education, employee engagement and community sustainability, three areas that represent an intersection of our business strengths and our ability to create positive impacts across our communities, all while integrating and upholding our values of diversity, equity and inclusion. Our global giving totaled more than $16.2 million in 2022, supporting hundreds of community organizations worldwide.
Within education, we seek to build the next generation of diverse and innovative leaders in science, technology, engineering and mathematics (“STEM”) through programs such as Girls in Tech initiative in Sumaré, Brazil, Centrum JongerenCommunicatie Chemie (C3) in Uithoorn, the Netherlands and X-Bots Robotics in Anaheim, California. In 2022, we invested $9.2 million in advancing STEM education, reaching 70% progress toward our commitment to invest $20 million by 2025 to advance racial equity in the U.S. by funding educational pathways for Black communities and people of color.
Our community sustainability investments deliver community transformations through colorful spaces, support essential needs (particularly in times of disaster), and provide opportunities to thrive in the communities where we operate. We activate the time and talent of our employees to make a difference in our local communities. Our COLORFUL COMMUNITIES® program brings together PPG volunteers, PPG products and financial support to provide a fresh coat of paint and rejuvenation to community spaces. We completed 87 projects around the world in 2022, including 36 school makeovers as part of the program’s New Paint for a New Start campaign.
Our Environment |
At PPG, we are committed to using resources efficiently, developing industry-leading sustainable solutions, and prioritizing decarbonization to protect the world for current and future generations.
In 2022, we continued to advance our sustainability strategy, committed to the Science Based Target initiative and submitted Scope 1, 2 and 3 GHG emissions reduction targets for 2030 to the organization for validation. PPG will announce our 2030 sustainability goals in 2023. We also finalized our global sustainability organization, embedding
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sustainability business partners who work with customers to innovate solutions that enable our customers’ sustainability ambitions.
Our sustainable paints, coatings and specialty materials create value and deliver sustainability benefits to our customers, suppliers and a variety of stakeholders. In 2022, we launched several sustainable offerings. One example is PPG INNOVEL® PRO, an internal beverage can coating that does not contain bisphenol-A (BPA) or bisphenol starting substances, and provides enhanced application, leading to less waste for infinitely recyclable aluminum beverage cans. PPG Innovel PRO earned a Cradle to Cradle Certified Material Health Certificate™ at the Platinum level. We have also initiated supplier collaborations to identify more sustainable raw material solutions for our products.
Minimizing the environmental footprint of our operations is an ongoing focus, and our locations are guided by our 2025 sustainability goals. One example of our efforts to introduce more sustainable operations is our Adrian, Michigan, automotive adhesives and sealants manufacturing facility, which entered into a 1.5 megawatt (MW) agreement with Constellation that will help PPG purchase the clean, renewable energy equivalent to the annual electricity use of the facility.
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2022 Achievements | ||||||
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Sustainably Advantaged Products | | | Energy Use | | | Greenhouse Gas |
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39% | | | ⇩8% | | | ⇩16% |
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39% of sales from products and | | | 8% of reduction in energy use from our 2017 baseline | | | 16% reduction in greenhouse gas emissions from our 2017 baseline |
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Water Withdrawal | | | Spill and Release | | | Waste Efficiency |
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⇩11% | | | ⇩20% | | | ⇩ 21% |
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11% reduction in water withdrawn from our 2017 baseline | | | 20% reduction in PPG’s spill and release rate from our 2017 baseline | | | 21% reduction in the quantity of waste disposed from our 2017 baseline |
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Human Rights | |
We respect the dignity and human rights of all people. As stated in our Global Code of Ethics, available at www.ppg.com, we comply with all laws pertaining to freedom of association, privacy, collective bargaining, immigration, working time, and wages and hours in our operations throughout the world. We also uphold laws prohibiting forced, compulsory and child labor, human trafficking and employment discrimination. We are committed to valuing differences among us in experience, perspective, background, race, age, national origin, religion, sex, sexual orientation, gender identity and/or expression, culture, interests, geography and style. We strive for a collaborative environment in which everyone is embraced for their differences and has an equal chance to succeed. We base employment decisions on job qualifications and merit, which include education, experience, skills, ability and performance. We give equal employment opportunity to – and will not discriminate against – individuals on the basis of any status protected by applicable laws.
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| 2023 Proxy Statement 9 |
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Recognition
PPG’s leadership and progress in key environmental, social and governance (“ESG”) areas has been recognized by reputable external organizations. Our recent awards include:
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EcoVadisTM | | | Human Rights Campaign Foundation | | | Forbes |
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Gold Rating – better than 94% of companies surveyed | | | Perfect Score on 2022 | | | America’s Best Large Employers |
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JUST Capital | | | FTSE4Good® Index Series | | | Newsweek |
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America’s Most JUST Companies 2023 | | | Listed for fourth consecutive | | | List of America’s Most Responsible Companies |
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Disability Equality Index® | | | R&D Magazine’s R&D 100 Awards | | | Forbes |
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Best Place to Work for Disability Inclusion | | | COPPER ARMORTM and Comex VINIMEX® TOTAL antiviral and antibacterial paints | | | America’s Best Employers for Veterans |
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Learn More You can learn more about PPG by visiting our website at www.ppg.com and PPG’s Sustainability Report website at www.sustainability.ppg.com, which highlights the Company’s sustainability achievements and progress against key ESG initiatives. In May, our latest ESG Report will be available with updates on the progress we made in 2022. |
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DIVERSITY OF OUR DIRECTORS
We value boardroom diversity as integral to effective corporate governance. We believe that board diversity – gender, race, age, insight, background and professional experience – is a necessity that improves the quality of decision-making and strategic vision, and represents the kind of company we aspire to be. Our Board of Directors is representative of a diverse group of industries, geographies, cultural backgrounds, ethnic backgrounds, viewpoints and ages. The Nominating and Governance Committee seeks to find director candidates who have demonstrated executive leadership ability and who are representative of the broad scope of shareholder interests by identifying candidates from varied industries having diverse cultural or ethnic backgrounds, viewpoints and ages. The Nominating and Governance Committee believes that the current members of the Board provide this diversity. Below are self-identified diversity characteristics of our directors.
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| Gender | International Origin | Hispanic or | White / | American | Asian | Black or |
ANGEL | M | | | √ | | | |
GRANT | M | √ | | √ | | | |
HEALEY | F | √ | √ | √ | | | |
HEMINGER | M | | | √ | | | |
KNAVISH | M | | | √ | | | |
LAMACH | M | | | √ | | | |
LIGOCKI | F | | | √ | | | |
MCGARRY | M | | | √ | | | |
NALLY | M | | | √ | | | |
NOVO | M | | √ | | | | |
RICHENHAGEN | M | √ | | √ | | | |
SMITH | F | | | √ | √ | | |
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Independence | | | Board Tenure | | | Age |
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10 out of 12 directors are independent | | | Diversity of Board Tenure | | | Mandatory Retirement |
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Board Refreshment | | | Female Committee Chairs |
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9 out of 12 directors have been elected since the end of 2014 | | | 2 out of 4 committees |
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| 2023 Proxy Statement 11 |
Since the end of 2012, the average age of our directors has decreased from 64 to 62 and our average director tenure has decreased from approximately 10 years to approximately seven years. Although our average director tenure has fallen with the addition of new directors, the Board believes that it is important to have longer-serving directors on the Board who have an intimate knowledge of our operations and our corporate philosophy. These longer-serving directors have also guided PPG through the peaks and troughs of the business cycle and can share this experience with our newer directors.
SKILLS, EXPERTISE AND EXPERIENCE OF OUR DIRECTORS
The table below lists some of the key skills, experience and expertise possessed by our directors. The skills listed below are those that are valued by our Board in guiding PPG, a global manufacturer and retailer of high technology paints, coatings and specialty materials for industrial and consumer markets, with operations in approximately 70 countries and approximately $17.7 billion in sales, and in overseeing our strategy for future growth. A checkmark indicates a specific area of focus or expertise on which the Board particularly relies. The biographies of our directors include more information about our directors’ relevant skills, experience and qualifications.
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| Leadership | Finance | Manufacturing | Global | Mergers & Acquisitions | Environment | Retail / | Technology |
Stephen | √ | √ | √ | √ | √ | √ | √ | √ |
Hugh Grant | √ | √ | | √ | √ | √ | √ | √ |
Melanie | √ | √ | √ | √ | | | √ | |
Gary | √ | √ | √ | √ | √ | | √ | |
Timothy | √ | √ | √ | √ | √ | √ | | √ |
Michael | √ | √ | √ | √ | √ | √ | | √ |
Kathleen | √ | √ | √ | √ | √ | √ | √ | √ |
Michael | √ | √ | √ | √ | √ | √ | √ | √ |
Michael | √ | √ | √ | √ | | √ | √ | |
Guillermo Novo | √ | √ | √ | √ | √ | √ | √ | √ |
Martin | √ | √ | √ | √ | √ | | √ | |
Catherine | √ | √ | √ | √ | √ | | √ | |
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PROPOSAL 1: Election of Directorsto Serve in a Class Whose Term Expires in 2025
Five directors are nominated for election to a class that will serve until the 2025 Annual Meeting of Shareholders and until their successors have been duly elected and qualified, or their earlier retirement or resignation. It is intended that the shares represented by each proxy will be voted, in the discretion of the proxies, FOR the nominees for directors set forth below, each of whom is an incumbent, or for any substitute nominee or nominees designated by our Board of Directors in the event any nominee or nominees become unavailable for election. In the event that an incumbent director receives a greater number of votes against their election than votes for such election, they are required to tender their resignation for consideration by the Nominating and Governance Committee of the Board of Directors in accordance with our Bylaws, as under “Director Resignation Policy.” The principal occupations of, and certain other information regarding, the nominees and our continuing directors are set forth below. In addition, information about each director’s specific experience, attributes and skills that led the Board to the conclusion that each of the directors is highly qualified to serve as a member of the Board is set forth below.
The Board believes that each of the Company’s directors is highly qualified to serve as a member of the Board. Each of our directors has contributed to the mix of skills, core competencies and qualifications of the Board. Our directors are highly educated and have diverse backgrounds and talents and extensive track records of success in what we believe are highly relevant positions with some of the most admired organizations in the world. Many of our directors also benefit from an intimate knowledge of our operations and corporate philosophy. The Board believes that each director’s service as the chair, chief executive officer, chief operating officer, president, chief financial officer or group president of a well-respected company has provided the directors with skills that are important to serving on our Board. The Board has also considered the fact that all of our directors have worked for, or served on the boards of directors of, a variety of companies in a wide range of industries. Specifically, the Board has noted that our directors have skills that, among others, have made them particularly suited to serve as a director of PPG, a global manufacturer and retailer of high technology paints, coatings and specialty materials for industrial and consumer markets, with operations in approximately 70 countries and approximately $17.7 billion in sales. The Board believes that through their varying backgrounds, our directors bring a wealth of experiences, new ideas and solutions to our Board.
On October 20, 2022, the Board of Directors elected Timothy M. Knavish as a director of PPG, effective that day, and assigned him to the class of directors who are standing for election at the 2023 Annual Meeting. The Board assigned Mr. Knavish to the class of directors who are standing for election at the 2023 Annual Meeting as a matter of good corporate governance to bring him before the Company’s shareholders at the next annual meeting after his election to the Board.
PPG’s Articles of Incorporation currently provide that the Board shall be divided into three classes as nearly equal in number as possible. At the 2022 Annual Meeting, PPG’s shareholders voted in favor of a Board-sponsored proposal to declassify the Board of Directors. On May 13, 2022, PPG’s Articles of Incorporation were amended to provide that all directors will be elected annually beginning at the 2025 Annual Meeting. The directors to be elected at the 2023 Annual Meeting will be elected to serve a two-year term. The directors to be elected at the 2024 Annual Meeting will be elected to serve a one-year term. At the 2025 Annual Meeting and at each meeting of shareholders thereafter, all directors will be elected annually.
Vote Required
Each director nominee who receives a majority of the votes cast (the number of shares voted “for” the director must exceed 50% of the votes cast with respect to that director) at the Annual Meeting will be elected as a director.
THE BOARD RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE ELECTION |
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| 2023 Proxy Statement 13 |
A Tribute to Steven A. Davis | ||
PPG director Steven A. Davis unexpectedly passed away on July 10, 2022 at the age of 64. Mr. Davis was elected as a director of PPG in 2019 and served on the Audit, Sustainability and Innovation and Nominating and Governance Committees during his tenure. Steve was a respected and trusted member of PPG's Board and our global family. His invaluable expertise and leadership had a dynamic impact on our organization. His involvement also extended deep into our organization through our Black Employee Network and other employee resource networks. Steve also participated in a variety of events and global webcasts involving our employees. His passion to help others grow and succeed made a positive impact throughout our organization and went well beyond his Board role. Earlier in 2022, Davis was included in the 16th Annual Directorship 100™ list of the nation's “Most Influential Corporate Directors and Governance Experts" by The National Association of Corporate Directors. The list recognized the most influential peer-nominated leaders in the boardroom and corporate governance community. Mr. Davis served as Chairman and Chief Executive Officer of Bob Evans Farms from 2006 to 2015. He also held a variety of leadership positions in the restaurant and consumer packaged goods industries, including President of Yum! Brands' Long John Silver's and A&W All-American Food Restaurants and other senior executive and operational positions at Yum! Brands and at Kraft General Foods. At the time of his passing, he served on the boards of directors of Albertsons Companies, Inc., American Eagle Outfitters, Inc., and Marathon Petroleum Corporation. He previously served on the boards of CenturyLink, Inc., Legacy Acquisition Corp., the Sonic Corp and Walgreens Boots Alliance. He also served on the International Board of Directors of the Juvenile Diabetes Research Foundation. | ||
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Nominees to Serve in a Class Whose Term Expires in 2025
The following directors, except Mr. Knavish who was elected to the Board in October 2022, were elected in 2020 for a three-year term expiring at the 2023 Annual Meeting. Under PPG’s amended Articles of Incorporation, at this Annual Meeting these directors will be elected for a two-year term expiring at the 2025 Annual Meeting.
4 | | -performance surface coatings, since October 31, 2018 upon the closing of the combination of Praxair, Inc. with Linde AG to form Linde plc. He served as Chairman of the Board, President and Chief Executive Officer of Praxair, Inc. from 2007 until October 31, 2018. Mr. Angel served as President and Chief Operating Officer of Praxair, Inc. from March to December 2006 and as Executive Vice President of Praxair, Inc. from 2001 to 2006. Prior to joining Praxair, Inc., Mr. Angel spent 22 years in a variety of management positions with General Electric Company. |
Stephen F. Angel | ||
Age: 67 Chairman of the Board of Linde plc | Professional Experience: Mr. Angel has been a Director of PPG since 2010. He has been Chairman of the Board of Linde plc, a global producer and distributor of atmospheric and process gases and high-performance surface coatings, since March 1, 2022. Mr. Angel served as Chief Executive Officer and a director of Linde plc from October 31, 2018 upon the closing of the combination of Praxair, Inc. with Linde AG to form Linde plc until February 28, 2022. He served as Chairman of the Board, President and Chief Executive Officer of Praxair, Inc. from 2007 until October 31, 2018. Mr. Angel served as President and Chief Operating Officer of Praxair, Inc. from March through December 2006 and as Executive Vice President of Praxair, Inc. from 2001 to 2006. Prior to joining Praxair, Inc., Mr. Angel spent 22 years in a variety of management positions with General Electric Company.Mr. Angel is also a director of General Electric Company. | |
Qualifications: Mr. Angel has diverse managerial and operational experience within the manufacturing industry. As the former Chief Executive Officer of Linde plc and a former senior operating executive at General Electric, Mr. Angel understands the challenges faced by a global manufacturer of diversified products, and his experience provides the Board with insight into sales and marketing and operational matters. |
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| | -off of the company in 2002. |
Hugh Grant | ||
Age: 64 Retired Chairman of the Board and Chief Executive Officer of Monsanto Company | Professional Experience: Mr. Grant has been a Director of PPG since 2005. Mr. Grant retired as Chairman of the Board and Chief Executive Officer of Monsanto Company, a global provider of technology-based solutions and agricultural products that improve farm productivity and food quality, on June 7, 2018 upon the closing of the merger of Monsanto Company and Bayer AG. Mr. Grant served as Chairman of the Board and Chief Executive Officer of Monsanto Company from 2003 until June 7, 2018. He previously served as Executive Vice President and Chief Operating Officer of Monsanto Company at the time of an initial public offering in 2000 and remained in that position for the subsequent spin-off of the company in 2002. Mr. Grant is also a director of Freeport-McMoRan Inc. and Linde plc. | |
Qualifications: Mr. Grant has an extensive background in the global agricultural technology industry, having served in various positions at Monsanto Company, where he was the Chairman of the Board and Chief Executive Officer. Mr. Grant brings to the Board significant leadership, corporate governance, managerial and operational expertise gained from years of experience leading the operations of a large multinational company. |
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Melanie L. Healey | ||
Age: 61 Former Group President, North America of The Procter & Gamble Company | Professional Experience: Ms. Healey has been a Director of PPG since 2016. She served as Group President at Procter & Gamble, one of the world’s leading providers of branded consumer packaged goods, from 2007 to 2015, serving as President and Advisor to the Chairman and Chief Executive Officer from January to June 2015; as Group President, North America from 2009 to 2015; and as Group President, Global Feminine and Health Care from 2007 to 2009. She previously served as President, Global Feminine Care and Adult Care Business from 2005 to 2007 and as Vice President and General Manager, Feminine Care North America from 2001 to 2005. Ms. Healey joined Procter & Gamble in 1990. She has more than 30 years of experience in the consumer goods industry having previously held positions with S. C. Johnson & Son, Inc. and Johnson & Johnson. Ms. Healey is also a director of Hilton Worldwide Holdings Inc., Verizon Communications Inc. and Target Corporation. Target Corporation has announced that Ms. Healey will not stand for re-election at Target's 2023 annual meeting of shareholders, which is expected to take place in June 2023. She will continue to serve as a director of Target until her current term on the board expires at Target’s 2023 annual meeting of shareholders. | |
Qualifications: Ms. Healey has extensive experience in the consumer goods industry with three multinational companies. She has a thorough understanding of strategy, branding, consumer marketing and international operations, including 18 years working outside the United States. Ms. Healey brings to the Board significant marketing, brand building, managerial and international expertise gained from years of experience marketing consumer products to customers worldwide. |
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| 2023 Proxy Statement 15 |
Timothy M. Knavish | ||
Age: 57 President and Chief Executive Officer of PPG Industries, Inc. | Professional Experience: Mr. Knavish has been a Director of PPG since October 2022. He has served as the President and Chief Executive Officer of PPG since January 1, 2023. Mr. Knavish served as Chief Operating Officer from March 1, 2022 to December 31, 2022. Mr. Knavish previously served as Executive Vice President from October 2019 through February 2022, Senior Vice President, Architectural Coatings and President, PPG Europe, Middle East and Africa from January 2019 through September 2019, Senior Vice President, Industrial Coatings from October 2017 through December 2018, Senior Vice President, Automotive Coatings from March 2016 through September 2017, Vice President, Protective and Marine Coatings from August 2012 through February 2016 and Vice President, Automotive Coatings, Americas from March 2010 through July 2012. Mr. Knavish joined PPG in 1987. | |
Qualifications: Mr. Knavish has been an employee of PPG for over 35 years and has served in executive level positions at PPG since 2010, providing him with significant knowledge of the coatings industry. He has been a highly successful leader of businesses in both PPG’s Industrial Coatings and Performance Coatings segments, serving in a variety of key business and functional leadership roles in the United States, Europe and the Asia Pacific region. Mr. Knavish has been integral to PPG’s recent acquisition strategy, having led the acquisitions and integrations of Tikkurila Oyj, expanding PPG’s leading European position into Scandinavia, and Ennis-Flint to form PPG’s traffic solutions business. Mr. Knavish also has led PPG’s efforts to enhance PPG’s sales capabilities and digital offerings. |
Guillermo Novo | ||
Age: 60 Chairman and Chief Executive Officer of Ashland Inc. | Professional Experience: Mr. Novo has been a Director of PPG since 2021. He has been Chairman and Chief Executive Officer of Ashland Inc. (formerly known as Ashland Global Holdings Inc.), a leading, global manufacturer of specialty materials for customers in a wide range of consumer and industrial markets, including architectural coatings, construction, energy, food and beverage, nutraceuticals, personal care and pharmaceuticals, since December 31, 2019. Prior to becoming Chairman and Chief Executive Officer, Mr. Novo was an independent director of Ashland, joining the board in May 2019. Mr. Novo served as the President and Chief Executive Officer and a director of Versum Materials, Inc. from 2016 until its sale in 2019. Previously, Mr. Novo served as Executive Vice President, Materials Technologies of Air Products and Chemicals, Inc. from 2014 to 2016, leading the spin-off of Versum Materials from Air Products and Chemicals. He joined Air Products and Chemicals in 2012 as Senior Vice President, Electronics, Performance Materials, Strategy and Technology. Prior to joining Air Products and Chemicals, Mr. Novo was employed by the Dow Chemical Company where he most recently served as Group Vice President, Dow Coating Materials. He began his career in 1986 with Rohm and Haas Company (which merged with Dow in 2009) and held a variety of commercial, marketing, and general management positions, living in South America, the United States and Asia. In 1998, Mr. Novo was named a Vice President at Rohm and Haas, and in 2006 he became a corporate officer and one of five group executives on the corporate leadership team responsible for driving the overall strategy for the company. Mr. Novo served as a director of Versum Materials, Inc. from 2016 to 2019 and as a director of Bemis Company, Inc. from 2018 to 2019 when Bemis was acquired by Amcor plc. | |
Qualifications: Mr. Novo’s over 30 years in the specialty chemicals and specialty materials industry brings to the Board extensive understanding of our business, including the perspective of a strategic raw material supplier to the specialty chemicals industry. He also has significant experience and knowledge in the areas of business strategy, mergers and acquisitions in the chemicals industry, global business operations, manufacturing and corporate governance. |
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16 2023 Proxy Statement | |
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Continuing Directors—Term Expires in 2024
The following directors were elected in 2021 for a three-year term expiring at the 2024 Annual Meeting. Under PPG’s amended Articles of Incorporation, at the 2024 Annual Meeting these directors will be elected for a one-year term expiring at the 2025 Annual Meeting.
Michael W. Lamach | ||
Age: 59 Retired Executive Chair and Chief Executive Officer of Trane Technologies plc | Professional Experience: Mr. Lamach has been a Director of PPG since 2015. He served as Executive Chair of Trane Technologies plc, a global leader in climate control and climate-focused innovations for buildings, homes and transportation, from July 1, 2021 until his retirement on December 31, 2021. Previously, Mr. Lamach served as Chairman and Chief Executive Officer of Trane Technologies from its separation from Ingersoll-Rand plc in February 2020 to July 1, 2021. Mr. Lamach served in several roles with Ingersoll-Rand, including Chairman and Chief Executive Officer from June 2010 to February 2020, Director from February 2010 to February 2020, President and Chief Executive Officer from February 2010 to June 2010; President and Chief Operating Officer from February 2009 to February 2010; President of Trane Commercial Systems from June 2008 to February 2009; and President of the Security Technologies Sector from February 2004 to June 2008. Prior to joining Ingersoll-Rand, Mr. Lamach spent 17 years in a variety of management positions with Johnson Controls. Mr. Lamach is also a director of Nucor Corporation. He served as a director of Iron Mountain, Inc. from 2007 to 2015 and as Chair of the Board of the National Association of Manufacturers. | |
Qualifications: During his career, Mr. Lamach led a number of businesses serving different end-use markets, including automotive components, controls, security systems and HVAC systems. As former Chairman and Chief Executive Officer of Trane Technologies plc and previously of Ingersoll-Rand plc, he brings to the Board experience leading global companies that sell a diverse range of products and services to |
Martin H. Richenhagen | ||||||||
Age: 70 Retired Chairman, President and Chief Executive Officer of AGCO Corporation | Professional Experience: Mr. Richenhagen has been a Director of PPG
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Qualifications: Mr. Richenhagen led global manufacturing companies for many years. As Chairman, President and Chief Executive Officer of |
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| 2023 Proxy Statement 17 |
Catherine R. Smith | ||
Age: 59 Chief Financial and Administrative Officer of Bright Health Group, Inc. | Professional Experience: Ms. Smith has been a Director of PPG since 2019. She has been Chief Financial and
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Qualifications: Ms. Smith has significant expertise gained from years of leading the complex finance organizations of some of the largest companies in the United States. Her experience in financial reporting, accounting and internal controls brings valuable expertise to the Board. In addition, Ms. Smith has extensive experience leading retail companies with a national and international footprint similar to that of PPG. |
Continuing Directors—Term Expires in 2025
The following directors were elected in 2022 for a three-year term expiring at the 2025 Annual Meeting. Under PPG���s amended Articles of Incorporation, at the 2025 Annual Meeting these directors will be elected for a one-year term expiring at the 2026 Annual Meeting.
consolidated master limited partnerships formed by Marathon Petroleum Corporation. | ||
Gary R. Heminger | ||
Age: 69 Retired Chairman and Chief Executive Officer of Marathon Petroleum Corporation | Professional Experience: Mr. Heminger has been a Director of PPG since 2017. Mr. Heminger retired as Chairman and Chief Executive Officer of Marathon Petroleum Corporation in April 2020. He became Chief Executive Officer of Marathon Petroleum in 2011 and became Chairman of the Board in 2016. Marathon Petroleum is one of the
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Qualifications:Mr. Heminger has significant leadership and financial expertise gained from years of service at a large petroleum product refining, transport, marketing and retail company. His over 40 years of experience leading a complex manufacturing and marketing business provides useful guidance in managing PPG’s complex organization with many of the |
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18 2023 Proxy Statement | |
| , and from 2012 to 2014 she was an operating partner at Kleiner Perkins Caufield & Byers, a top venture capital firm. From 2010 to 2012, Ms. Ligocki was President and Chief Executive Officer and a director of Next Autoworks, a start-up automobile manufacturer. From 2008 to 2010, she served as principal at Pine Lake Partners, a consultancy for start-up companies, and from 2008 to 2009 she was President and Chief Executive Officer of start-up Mexican automobile manufacturer and retailer, GS Motors, owned by Grupo Salinas, a Mexican conglomerate. From 2003 to 2007, Ms. Ligocki was Chief Executive Officer of Tower Automotive, a Fortune 1000 automotive supplier. Her previous experience includes executive leadership positions in global operations at Ford Motor Company and United Technologies Corporation as well as various leadership roles at General Motors Corporation. Ms. Ligocki is also a director of Lear Corporation and Carpenter Technology Corporation and served as a director of Ashland Inc. from 2004 to 2014. | |
Kathleen A. Ligocki | ||
Age: 66 Former Chief Executive Officer of Agility Fuel Solutions, LLC | Professional Experience: Ms. Ligocki has been a Director of PPG since 2020. Ms. Ligocki served as Chief Executive Officer of Agility Fuel Solutions, LLC, a leading manufacturer of natural gas solutions for medium and heavy-duty vehicles in North America, from 2015 to 2019. From 2014 to 2015, she was President and Chief Executive Officer and a director of start-up company, Harvest Power, Inc., a leading organic waste management company in North America, and from 2012 to 2014 she was an operating partner at Kleiner Perkins Caufield & Byers, a top venture capital firm. From 2010 to 2012, Ms. Ligocki was President and Chief Executive Officer and a director of Next Autoworks, a start-up automobile manufacturer. From 2008 to 2010, she served as principal at Pine Lake Partners, a consultancy for start-up companies, and from 2008 to 2009 she was President and Chief Executive Officer of start-up Mexican automobile manufacturer and retailer, GS Motors, owned by Grupo Salinas, a Mexican conglomerate. From 2003 to 2007, Ms. Ligocki was Chief Executive Officer of Tower Automotive, a Fortune 1000 automotive supplier. Her previous experience includes executive leadership positions in global operations at Ford Motor Company and United Technologies Corporation as well as various leadership roles at General Motors Corporation. Ms. Ligocki is also a director of Carpenter Technology Corporation and Lear Corporation. She served as a director of Qell Acquisition Corp. from October 2020 to December 2021 and as a director of Ashland Inc. from 2004 to 2014. | |
Qualifications: Ms. Ligocki has diverse senior leadership experience in the automotive and transportation industry, a key customer for PPG’s products. As the chief executive officer of several start-up and early stage companies, she brings to the Board significant understanding of the importance of innovation and the |
Michael H. McGarry | ||
Age: 65 Executive Chairman and former Chairman and Chief Executive Officer of PPG Industries, Inc. | Professional Experience: Mr. McGarry has been a Director of PPG since 2015. Mr. McGarry became Executive Chairman of PPG on January 1, 2023. He served as Chairman and Chief Executive Officer of PPG from September 1, 2016 to December 31, 2022. Previously, he served as President and Chief Executive Officer from September 1, 2015 to September 1, 2016, President and Chief Operating Officer from March 2015 until September 1, 2015 and Chief Operating Officer from August 2014 until March 2015. Mr. McGarry has also served as Executive Vice President from 2012 until 2014; Senior Vice President, Commodity Chemicals from 2008 until 2012; Vice President, Coatings, Europe, and Managing Director, PPG Europe from 2006 until 2008; and Vice President, Chlor-Alkali and Derivatives from 2004 to 2006. He joined PPG in 1981. Mr. McGarry is also a director of United States Steel Corporation and Shin-Etsu Chemical Co. Ltd. and served as a director of Axiall Corporation from 2013 through August 2016. He also served as Chairman of the American Coatings Association. | |
Qualifications: Mr. McGarry has been an employee of PPG for over 40 years and has served in executive level positions at PPG since 2004, providing him with a nearly unparalleled knowledge of the coatings industry. He has served in a variety of key business and functional leadership roles in the |
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| 2023 Proxy Statement 19 |
Michael T. Nally | ||
Age: 47 Chief Executive Officer and Director of Generate Biomedicines, Inc. and CEO-partner of Flagship Pioneering | Professional Experience: Mr. Nally has been a Director of PPG since 2021. He has been Chief Executive Officer of Generate Biomedicines, Inc., a company that uses machine learning algorithms to design biological compounds to combat disease, since March 31, 2021. Previously, Mr. Nally was Executive Vice President and Chief Marketing Officer of Merck & Co., Inc., a leading, global health care company that delivers innovative health solutions through prescription medicines, vaccines, biologic therapies and animal health products, from January 2019 to March 31, 2021. Mr. Nally led Merck’s human health business and was responsible for developing Merck’s growth strategy and commercialization model. From September 2016 to January 2019, Mr. Nally served as President, Global Vaccines and delivered significant business growth and a dramatic increase in the reach and public health impact of pediatric, adolescent and adult vaccines. He served as Managing Director, United Kingdom and Ireland from January 2014 through August 2016. Previously, Mr. Nally served in key management positions in strategic initiatives, commercial operations, business development and investor relations after joining Merck in 2003. | |
Qualifications: Mr. Nally’s leadership experience in the pharmaceutical industry brings to the Board |
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20 2023 Proxy Statement | |
CORPORATE GOVERNANCE
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Our Governance Highlights | ||||
√ | 10 of 12 directors are independent | | √ | Board oversight of Company strategy |
√ | All Board committee members are independent | | √ | Annual Board and committee self-evaluations |
√ | Majority voting in uncontested elections | | √ | Extensive shareholder engagement |
√ | No dual class structure; each shareholder gets one vote per share | | √ | Independent directors regularly meet without management present |
√ | Proxy access right with market terms | | √ | No poison pill |
√ | Strong independent Lead Director with clearly defined duties that are publicly disclosed | | | |
BOARD OF DIRECTORS | |||||||||||||||||||||||||||||||
Chairman: Michael H. McGarry | | Board’s Emphasis on Strategy PPG’s Board is actively engaged in developing our strategy and overseeing its execution, including major business and organizational initiatives, capital allocation priorities and potential business development opportunities. The Board | |||||||||||||||||||||||||||||
Independent Lead Director:Hugh Grant | | | |||||||||||||||||||||||||||||
Meetings: 8 | | ||||||||||||||||||||||||||||||
10 of 12 PPG Directors are Independent | | ||||||||||||||||||||||||||||||
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√Our independent directors meet separately, without any management present, at
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√Management succession is regularly discussed by the Board | | ||||||||||||||||||||||||||||||
√The Lead Director presides over the | | | |||||||||||||||||||||||||||||
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99% | | The average attendance at meetings of the Board and committees during |
Board Composition, Refreshment and Diversity
PPG’s business, property and affairs are managed under the direction of the Board of Directors. The Board is currently comprised of 12 members, divided into three classes. Terms of the classes are staggered, with one class standing for election each year. At the Company’s 2022 Annual Meeting, shareholders approved a Board-sponsored proposal to amend PPG’s Articles of Incorporation to provide for the annual election of all directors. Pursuant to PPG’s amended Articles of Incorporation, all directors will be elected annually beginning at PPG’s 2025 Annual Meeting. The Board is elected by our shareholders to oversee management of the Company in the long-term interests of all shareholders. The Board also considers the interests of other stakeholders, which include customers, employees, retirees, suppliers, the communities we serve and the environment. The Board strives to ensure that PPG conducts business in accordance with the highest standards of ethics and integrity.
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| 2023 Proxy Statement 21 |
The Board seeks to maintain an appropriate balance of directors with varying tenure, diversity and skills. The Nominating and Governance Committee continually evaluates potential director candidates with the goal of finding directors whose skills complement the skills of PPG’s current directors, who add to the expertise of the Board as a whole and who have experience to contribute insight into our strategy. Using a skills matrix that includes the experience and skills of our current directors and keeping in mind the skills that the Board believes would add to the capabilities and knowledge of our Board, the Nominating and Governance Committee regularly reviews the skills and experience of our directors and potential director candidates. More information about the skills and experience of our directors can be found in the matrix on page 12 and within the biographies of our directors beginning on page 14.
Our Corporate Governance Guidelines require that any director who has attained the age of 72 retire at the next annual meeting following the director's 72nd birthday. Nine new directors have joined the Board since the end of 2014. Since the end of 2012, the average age of our directors has decreased from 64 to 62 and our average director tenure has decreased from approximately 10 years to approximately seven years. Although our average tenure has fallen with the addition of new directors, the Board believes that it is important to have longer-serving directors on the Board who have an intimate knowledge of our operations and our corporate philosophy. These longer-serving directors have also guided PPG through the peaks and troughs of the business cycle and can share this experience with our newer directors.
The Nominating and Governance Committee does not a have formal policy with regard to the consideration of diversity in identifying director candidates. However, we endeavor to have a Board representing diverse experience at policy-making levels in business, government, education and technology, and in areas that are relevant to the Company’s global activities. The Nominating and Governance Committee seeks to find director candidates who have demonstrated executive leadership ability and who are representative of the broad scope of shareholder interests by identifying candidates from varied industries having diverse cultural or ethnic backgrounds, viewpoints and ages. The Nominating and Governance Committee believes that the current members of the Board provide this diversity as discussed more specifically on page 11.
Director Independence
In accordance with the rules of the New York Stock Exchange, the Board affirmatively determines the independence of each director and nominee for election or appointment as a director in accordance with the categorical guidelines it has adopted, which include all objective standards of independence set forth in the exchange listing standards. Based on these standards, at its meeting held on February 16, 2023, the Board determined that each of the following non-employee directors is independent and has no material relationship with PPG, except as a director and shareholder:
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Stephen F. Angel | Kathleen A. Ligocki |
Hugh Grant | Michael T. Nally |
Melanie L. Healey | Guillermo Novo |
Gary R. Heminger | Martin H. Richenhagen |
Michael W. Lamach | Catherine R. Smith |
In addition, based on such standards, the Board affirmatively determined that Michael H. McGarry and Timothy M. Knavish are not independent because they are officers of PPG. The categorical independence standards adopted by the Board are contained in the Corporate Governance Guidelines, which may be accessed from the Corporate Governance section of our website at investor.ppg.com.
Board Leadership Structure
We believe our Board leadership structure provides the appropriate balance of independent directors and management directors. Throughout 2022, we had a traditional board leadership structure under which Mr. McGarry served as our Chairman of the Board and Chief Executive Officer. Beginning on January 1, 2023, Mr. McGarry became PPG’s Executive Chairman and Mr. Knavish became PPG’s President and Chief Executive Officer. Having a combined position of Chairman and Chief Executive Officer or an Executive Chairman is only one element of our leadership structure, which also includes an independent Lead Director and active, independent non-employee directors. We currently have 10 non-employee directors, each of whom is independent. Our Board has four standing committees, each of which is comprised solely of independent directors with an independent committee chair. The Board has determined that the appropriate structure for the Board at this time is for Mr. McGarry, our former Chief Executive Officer, to serve as Executive Chairman of the Board, while also providing for the counterbalance of a strong independent Lead Director role, fully independent Board committees, and other good governance practices.
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22 2023 Proxy Statement | |
The Board believes that Mr. McGarry is the best person to serve as Chairman because he is the director most familiar with our business and industry and the director most capable of identifying strategic priorities, communicating these to the Board and executing our business strategy. The Board believes Mr. McGarry’s service as Executive Chairman creates a highly effective bridge between the Board and management and provides the leadership to execute our business strategy and create shareholder value. In addition, having Mr. McGarry continue to serve as Executive Chairman demonstrates to our employees, suppliers, customers, shareholders and other stakeholders that PPG has undertaken a thoughtful and measured leadership transition. Mr. McGarry’s Board leadership will allow for the continued, orderly transition of the Chief Executive Officer role to Mr. Knavish and will allow Mr. McGarry to continue to mentor Mr. Knavish as he begins his tenure as PPG’s Chief Executive Officer. Having Mr. McGarry serve as Executive Chairman also provides the Board time to consider the best Board leadership approach for PPG after Mr. McGarry retires based on the Company’s current circumstances.
Our Board consists of directors with significant leadership skills, as discussed above. All of our independent directors have served as the chairman, chief executive officer, president, chief financial officer or group president of other companies. Accordingly, we believe that our independent directors have demonstrated leadership in large enterprises and are well versed in board processes and that having directors with significant leadership skills benefits our Company and our shareholders.
In accordance with our Bylaws and our Corporate Governance Guidelines, the Chairman is responsible for chairing Board meetings and setting the agenda for these meetings. Each director also may suggest items for inclusion on the agenda and may raise at any Board meeting subjects that are not on the agenda for that meeting. As required by our Corporate Governance Guidelines, our independent directors meet separately, without management present, at each meeting of the Board. In addition, each of the Board’s standing committees regularly meets without members of management present.
The Board has designated the chair of the Nominating and Governance Committee to serve as the Lead Director. In their discretion, the independent directors may select another independent director to serve as the Lead Director. Aside from chairing meetings of the independent directors, the Lead Director:
● | presides at all meetings where the Chairman is not present; |
● | facilitates communications and serves as a liaison between the independent directors, |
● | has the power to call meetings of the independent directors; |
● | communicates to the Executive Chairman and the Chief Executive Officer any suggestions, views or concerns expressed by the independent directors and consults with the Executive Chairman and the Chief Executive Officer about the concerns of the Board; |
● | advises the Executive Chairman and the Chief Executive Officer as to the information necessary or appropriate for the independent directors to effectively and responsibly perform their duties and provides feedback on the quality, quantity and timeliness of information submitted by management; |
● | approves Board meeting agendas and other types of information sent to the Board; |
● | approves meeting schedules to assure that there is sufficient time for discussion of all agenda items; |
● | is available for consultation and direct communication with major shareholders as appropriate; |
● | participates in the identification and evaluation of director candidates and facilitates director development; |
● | acts as a resource and advisor to
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● | unless otherwise directed by the Board, serves as the |
● | recommends to the Board the formation and membership of ad-hoc committees of the Board to oversee extraordinary matters such as significant corporate transactions and crisis situations; |
● | authorizes the retention of outside advisors and consultants who report directly to the Board on Board-wide issues; |
● | actively participates in the Board’s review of acquisition opportunities and the management succession process; and |
● | performs such other duties as the Board may from time to time designate. |
As part of its annual self-evaluation process, the Board, at least annually, evaluates our leadership structure to ensure that it provides the optimal structure for PPG. We believe that having a director with day-to-day oversight of Company
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| 2023 Proxy Statement 23 |
operations, coupled with experienced independent directors who have appointed a Lead Director and four wholly-independent board committees, is the appropriate leadership structure for PPG.
Shareholder Engagement
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Through engagement with our shareholders, the Board and our senior management team are provided with feedback on a variety of topics, including: ● strategic and financial performance ● operations ● corporate governance ● executive compensation ● Board composition ● sustainability ● diversity, equity and inclusion | | | | | ||||||
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| | | Percentage of our outstanding shares held by active, institutional investors with whom we met in 2022. | | | Percentage of our outstanding shares held by institutional investors with whom we held governance-focused meetings in 2022. | ||||
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These constructive engagements enable the Board and management to evaluate and assess our Company from different perspectives and viewpoints. Our Lead Director, Hugh Grant, participated in a number of these governance-focused meetings. The key themes of feedback received during our engagement meetings as well as efforts we are taking in consideration of the feedback we received were shared with the Board. These initiatives help to ensure that the Board is apprised of key trends and topics being considered by our shareholders. A general outline of our approach to shareholder engagement can be found below. | ||||||||||
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Before the Annual Meeting of Shareholders | At the Annual Meeting of Shareholders | After the Annual Meeting of Shareholders | ||||||||
● We reach out to investors to discuss key issues facing our Company and industry ● Together, the Board and senior management discuss shareholder feedback and determine if additional actions are required ● Management institutes changes as appropriate | | Our shareholders: ● elect eligible nominees to join the Board of Directors ● vote on executive compensation ● vote on the ratification of our auditors ● potentially vote on other proposals brought by management or by our shareholders | | ● We tabulate and review the voting results ● Together, the Board and senior management discuss the results and determine what additional actions are appropriate ● We prepare our agenda for further shareholder engagement |
The Board’s Role in ESG
Our Board is actively engaged in our ESG programs and initiatives. Our ESG approach is grounded in our vision of delivering lasting value for stakeholders and customers by operating with integrity, working safely, respecting the contributions of our people, preserving the environment and supporting the communities where we operate. Our ESG
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24 2023 Proxy Statement | |
oversight structure is designed to effectively govern and manage the ESG risks and opportunities that are integral to our business strategy, and Board oversight of significant ESG matters is incorporated into its oversight of our business and our strategy. Significant ESG risks are reviewed and evaluated by the Board and its committees as part of their ongoing risk oversight of our Company.
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Framework for Board oversight of ESG | | Environmental | Social | Governance | | ||||||
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| | Sustainability and | PPG Board | Nominating and | | | |||||
| Employee health and safety Environmental programs Product stewardship Remediation activities Sustainability programs and performance Climate change risks and opportunities | | Corporate governance oversight Recommending new directors and executive officers Government affairs and political activities Shareholder engagement ESG program governance | | | ||||||
| | ESG strategy Succession planning Diversity, equity and inclusion Community engagement and | | | | ||||||
| | Human Capital Management | | Audit Committee | | | | ||||
| Culture and purpose Employee engagement Employee development Executive compensation Pay equity | | Enterprise risk management Cybersecurity Data privacy | | |
In 2021, the Board conducted a comprehensive review of its oversight of the Company’s ESG programs and practices to ensure that the Board or one of its committees has oversight responsibility for each of the ESG programs and practices that is significant to PPG. As a result of this review, the Board in 2021 revised our Corporate Governance Guidelines and the charters of each committee to more clearly specify the ESG programs and practices overseen by the Board and each of its committees. The Nominating and Governance Committee actively monitors the changing ESG landscape and recommends changes to PPG’s governance programs and practices.
The Board’s long-standing Sustainability and Innovation Committee (formerly known as the Technology and Environment Committee) oversees and receives regular updates on the Company’s environment, health, safety, product stewardship and sustainability initiatives, including the Company’s sustainability goals and progress toward our goals. In connection with its review of our ESG oversight program, the Board selected the Sustainability and Innovation Committee as the committee with responsibility for reviewing the risks and opportunities to PPG of the effects of climate change.
PPG recognizes the importance of corporate culture and diversity, equity and inclusion efforts to our success. The Board has been focused on employee engagement and provided its guidance in connection with the formulation and introduction of The PPG Way. Since the introduction of The PPG Way, the Board has received regular updates on our engagement progress. The Board has also endorsed our recent diversity, equity and inclusion actions, including hiring an executive level Global Head of Diversity, Equity and Inclusion, reporting of our diversity, equity and inclusion programs, achievements and statistics and the PPG Industries Foundation’s commitment to organizations focusing on social justice. In 2021, the Board repositioned the Officers-Directors Compensation Committee as the Human Capital Management and Compensation Committee and expanded its responsibilities to include oversight of our human capital strategies in the areas of culture and purpose, employee engagement, development and pay equity.
Our aim is to bring color and brightness to communities around the world. The PPG Industries Foundation is the primary vehicle for our U.S. community engagement efforts. The PPG Industries Foundation distributes over $6 million in donations annually and manages our COLORFUL COMMUNITIES® program. The Board has oversight responsibility for the PPG Industries Foundation and also receives updates on PPG’s other community engagement and global giving initiatives.
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| 2023 Proxy Statement 25 |
PPG engages in the political process when we believe that doing so will serve the best interests of the Company and our stakeholders. We support public policies that contribute to the achievement of our long-term growth. The Nominating and Governance Committee has been assigned responsibility to oversee our government affairs activities and to receive periodic reports regarding the activities of our Government Affairs team. More information about PPG’s political activities, including PPG’s Political Contributions and Activities Policy and political spending reports, are available on our Government Affairs website at http://corporate.ppg.com/Our-Company/Government-Affairs.aspx.
Each Board committee will report its activities in these areas back to the full Board of Directors.
At the management level, day-to-day implementation of our ESG initiatives is led by our Vice President, Global Sustainability, a new position created in 2021 to coordinate PPG’s ESG and sustainability programs and to communicate our ESG progress with our customers, shareholders and other stakeholders. The Vice President, Global Sustainability works with PPG’s Sustainability Committee, a committee of management consisting of senior corporate executives, to establish and monitor our sustainability goals, policies, programs and procedures that incorporate sustainability into our business practices, including resource management, climate change impacts, innovation, communications, community engagement, procurement, manufacturing and employee wellness.
Board Oversight of PPG’s Strategy
PPG’s Board is actively engaged in developing and overseeing the execution of our strategy, including major business and organizational initiatives, capital allocation priorities and potential business development opportunities. Throughout the year, the Board applies its experience in manufacturing, global business, science and technology and marketing to oversee the execution of our strategy and capital allocation and works with senior management to guide our strategy. At its October meeting, the Board devotes one full day to reviewing and formulating our strategy. At each Board meeting and during our annual strategy session, directors engage with PPG’s senior leadership in robust discussions about the Company’s overall strategy, priorities for its businesses and long-term growth opportunities.
The Board’s Role in Risk Management
Management | Our management team, led by the Enterprise Risk Committee, is responsible for the day-to-day management of risk. | Board of Directors | |||||
Our Board has broad oversight responsibility for our risk-management programs. While the Audit Committee has primary responsibility for overseeing our enterprise risk assessment and management process, our entire Board is actively involved in overseeing risk management for the Company by engaging in periodic discussions with Company officers and other employees as the Board may deem appropriate. We believe that the leadership structure of our Board supports the Board’s effective oversight of the Company’s risk management. | |||||||
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Audit Committee Focuses on risks inherent in our accounting, financial reporting, legal and regulatory compliance, cybersecurity, data privacy and internal controls. | | Sustainability and Innovation Committee Considers risks related to our environment, health, safety, product stewardship, climate change and our sustainability programs. Reviews our approach to innovation, science and technology. | | Human Capital Management and Compensation Committee Considers the risks that may be implicated by our executive compensation and human capital management programs. |
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26 2023 Proxy Statement | |
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Special Role of Audit Committee: ● In accordance with New York Stock Exchange
● The Audit Committee is includes the feedback from the Company’s officers and key managers. The Audit Committee, |
PPG’s Enterprise Risk Committee (“ERC”), a committee of management, has overall management responsibility for PPG’s enterprise risk management processes. The membership of the ERC includes the Executive Committee of the Company and the Director, Corporate Audit Services. Its responsibilities include:
● | developing and |
● | identifying and monitoring the |
● | monitoring PPG’s risk management capabilities and |
● | reviewing the |
● | reviewing and assessing the effectiveness of PPG’s |
The ERC provides updates on its key activities and PPG’s enterprise risk management programs and risk posture to the Board or its committees, as appropriate.
Executive Succession Planning
One of the Board’s primary responsibilities is to oversee the development of appropriate executive-level talent to successfully execute PPG’s strategy. Management succession is regularly discussed by the Board with the Executive Chairman, the President and Chief Executive Officer and PPG’s Vice President and Chief Human Resources Officer. The Board reviews candidates for all executive officer positions to confirm that qualified successor-candidates are available for all key positions and that development plans are being utilized to strengthen the skills and qualifications of successor-candidates. At least annually, as required by our Corporate Governance Guidelines, and typically more often, the Board’s discusses Chief Executive Officer succession planning. The current Chief Executive Officer provides the Board with recommendations for and evaluations of potential Chief Executive Officer successors and reviews with the Board development plans for these successors. Directors engage with potential Chief Executive Officer and senior management talent at Board and committee meetings and in less formal settings to enable directors to personally interact with candidates. The Board reviews management succession in the ordinary course of business as well as contingency planning in the event of an emergency or unanticipated event.
Corporate Governance Guidelines, Board Self-Evaluation and Board Orientation
The Board has adopted Corporate Governance Guidelines. These guidelines are revised from time to time to better address particular needs as they change over time. The Board revised the Corporate Governance Guidelines in 2021 to clarify the ESG responsibilities of the Board of Directors. The Corporate Governance Guidelines may be accessed from the Corporate Governance section of our website at investor.ppg.com.
The Board annually evaluates its own performance and that of its standing committees. The evaluation process is coordinated by the Nominating and Governance Committee and has three parts: committee self-assessments, full Board evaluations and evaluations of the individual directors in the class whose term is expiring at the next annual meeting. The committee self-assessments consider whether and how well each committee has performed the responsibilities listed in its charter. The full Board evaluations consider the committee self-assessments as well as the quality of the Board’s meeting agendas, materials and discussions. All assessments and evaluations focus on both strengths and opportunities for improvement and are shared with the Board.
The Board has a program for orienting new directors which includes presentations from members of senior management regarding our operations, technologies, governance, finances, compensation programs and other topics of interest to our new directors. The Company also provides for continuing education for all directors, including the reimbursement of expenses for continuing education.
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| 2023 Proxy Statement 27 |
Director Resignation Policy
Our Bylaws provide that if an incumbent director is not elected by majority vote in an “uncontested election” (where the number of nominees does not exceed the number of directors to be elected), the director must offer to tender their resignation to our Board of Directors. The Nominating and Governance Committee would then make a recommendation to the Board whether to accept or reject the resignation, or whether other action should be taken. The Board will act on the Nominating and Governance Committee’s recommendation and publicly disclose its decision and the rationale behind it within 90 days from the date the election results are certified. The director who tenders their resignation will not participate in the Board’s decision with respect to their resignation. The election of directors that will be held at the 2023 Annual Meeting is an uncontested election.
Review and Approval or Ratification of Transactions with Related Persons
The Board and its Nominating and Governance Committee have adopted written policies and procedures relating to approval or ratification of “Related Person Transactions.” Under these policies and procedures, the Nominating and Governance Committee (or its chair, under some circumstances) reviews the relevant facts of all proposed Related Person Transactions and either approves or disapproves of the Related Person Transaction, by taking into account, among other factors it deems appropriate:
● | the
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● | the |
● | the availability of other sources for comparable products or services; |
● | the terms of the
No director may participate in any consideration or approval of a Related Person Transaction with respect to which they or any of their immediate family members is the Related Person. Related Person Transactions are approved only if they are determined to be in, or not inconsistent with, the best interests of PPG and its shareholders. If a Related Person Transaction that has not been previously approved or previously ratified is discovered, the Nominating and Governance Committee, or its chair, will promptly consider all of the relevant facts. In addition, the committee generally reviews all ongoing Related Person Transactions on an annual basis to determine whether to continue, modify or terminate the Related Person Transaction. Under our policies and procedures, a “Related Person Transaction” is generally a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which PPG was, is or will be a participant and the amount involved exceeds $120,000, and in which any Related Person had, has or will have a direct or indirect material interest. A “Related Person” is generally any person who is, or at any time since the beginning of PPG’s last fiscal year was, (i) a director or executive officer of PPG or a nominee to become a director of PPG; (ii) any person who is known to be the beneficial owner of more than 5% of any class of PPG’s voting securities; or (iii) any immediate family member of any of the foregoing persons.
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| Retired Chairman of the Board
| Freeport-McMoRan Inc. Linde plc | √ | 2005 |
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Melanie L. Healey | 61 | Former Group President, North America of The Procter & Gamble Company | Hilton Worldwide Holdings Inc. Target Corporation Verizon Communications Inc. | √ | 2016 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Timothy M. Knavish | 57 | President and
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Guillermo Novo | 60 | Chairman and Chief Executive Officer of Ashland Inc. | None | √ | 2021 |
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Audit Committee | Human Capital Management and |
Hugh Grant | 64 | Retired Chairman of the Board and Chief Executive Officer of Monsanto Company | Freeport-McMoRan Inc. Linde plc | √ | 2005 |
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Melanie L. Healey | 61 | Former Group President, North America of The Procter & Gamble Company | Hilton Worldwide Holdings Inc. Target Corporation Verizon Communications Inc. | √ | 2016 | |||||||||||
Timothy M. Knavish | 57 | President and Chief Executive Officer of PPG Industries, Inc. | None | | 2022 | None | ||||||||||
Guillermo Novo | 60 | Chairman and Chief Executive Officer of Ashland Inc. | None | √ | 2021 |
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Audit Committee | Human Capital Management and Compensation Committee | Nominating and Governance Committee | Sustainability and Innovation Committee |
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| 2023 Proxy Statement 5 |
Governance Highlights
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Independence | 10 of 12 directors are independent | |
All Board committee members are independent | ||
Independent directors regularly meet without management present | ||
Strong independent Lead Director with clearly defined duties that are publicly disclosed | ||
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Accountability | Majority voting in uncontested elections | |
Annual Board and committee self-evaluations | ||
Board oversight of Company strategy | ||
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Shareholder | No dual class structure; each shareholder gets one vote per share | |
Proxy access right with market terms | ||
Extensive shareholder engagement | ||
No poison pill | ||
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Financial Highlights
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NET SALES | | | ADJUSTED EARNINGS PER DILUTED SHARE* | | | OPERATING CASH FLOW | |||
| Up 5% | | | | $6.05 | | | | ~$1 Billion |
*From continuing operations. See reconciliation in Appendix A
Executive Compensation Highlights
Executive compensation is based on our pay-for-performance philosophy, which emphasizes executive performance measures that correlate closely with the achievement of both shorter-term performance objectives and longer-term shareholder value creation.
Compensation Component | Overview | Objectives |
Base Salary | Fixed compensation that is established annually | Maintain parity with the competitive market for executives in comparable positions |
Annual Incentive Awards | Variable compensation that is based on Company, business, and individual performance | Incentivize executive officers to achieve our short-term performance objectives |
Long-Term, Equity-Based Incentives | Variable compensation that is based solely on Company performance | Retain our executive officers, align their financial interests with the interests of shareholders, and incentivize achievement of our long-term strategic goals |
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6 2023 Proxy Statement | |
EXECUTIVE TARGET PAY MIX
Executive compensation is based on our pay-for-performance philosophy, which emphasizes executive performance measures that correlate closely with the achievement of both shorter-term performance objectives and longer-term shareholder value creation. To this end, a substantial portion of our executives’ annual and long-term compensation is performance-based, with the payment being contingent on the achievement of performance goals.
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Chief Executive Officer Pay Mix | Average Other Named Executive Officer Pay Mix | |
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CHOOSE ELECTRONIC DELIVERY
We encourage PPG shareholders to voluntarily elect to receive future proxy and annual report materials electronically to help contribute to our sustainability efforts. If you are a registered shareholder, please visit www.cesvote.com for instructions. Beneficial shareholders can opt for e-delivery at www.proxyvote.com or by contacting their stockbroker or other nominee.
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| Combined with your adoption of Electronic Delivery of Proxy Materials, and the elimination of approximately 74,336 sets of proxy materials, we can ideally reduce the impact on the environment by: | | ||||
| using approximately 151 fewer tons of wood, or 906 fewer trees (14.1 acres of forest) | | saving approximately 810,000 gallons of water, or the equivalent of filling approximately 37 swimming pools | | ||
| using approximately 965 million fewer BTUs, or the equivalent of the amount of energy used by 1,150 residential refrigerators for one full year | | using approximately 680,000 fewer pounds of greenhouse gases, including CO2, or the equivalent of 61.8 automobiles running for one year | | ||
| eliminating approximately 44,600 pounds of solid waste | | reducing hazardous air pollutants by approximately 60.4 pounds | | ||
| Environmental impact estimates were calculated using the Environmental Paper Network Paper Calculator. For more information visit www.papercalculator.org. | | ||||
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| 2023 Proxy Statement 7 |
SUSTAINABILITY, CULTURE AND HUMAN RIGHTS
Our Culture |
At PPG, we aim to champion all employees, empowering them to be their authentic selves and allowing everyone to reach their full potential. In 2022, we achieved several key milestones, including:
● | Launched our inaugural Diversity, Equity & Inclusion Report. |
● | Earned a score of 100 on the 2022 DISABILITY EQUALITY INDEX®. |
● | Formally scaled a global recruiting process for non-frontline roles by using labor market data to build diverse candidate slates for recruitment. |
● | Launched a new leadership competency model, The PPG Way to Lead, to connect our behaviors to our values, providing clarity and consistency for what great leadership looks like at PPG. |
● | Created a safe forum for conversations and storytelling around bias, discrimination and inclusion at a personal level by launching our Listen & Learn sessions. |
● | Our eight Employee Resource Networks (“ERNs”) have grown to more than 7,550 members and are active in more than 60 countries. Through 2022, there were more than 22,000 participants in more than 30 ERN-sponsored events. |
● | Expanded our Employee Assistance Program to include all global employees, ensuring access to a variety of tools and resources to manage the many facets of wellness. |
Our Communities |
At PPG, our community engagement supports our purpose to protect and beautify the world. Our efforts are focused on education, employee engagement and community sustainability, three areas that represent an intersection of our business strengths and our ability to create positive impacts across our communities, all while integrating and upholding our values of diversity, equity and inclusion. Our global giving totaled more than $16.2 million in 2022, supporting hundreds of community organizations worldwide.
Within education, we seek to build the next generation of diverse and innovative leaders in science, technology, engineering and mathematics (“STEM”) through programs such as Girls in Tech initiative in Sumaré, Brazil, Centrum JongerenCommunicatie Chemie (C3) in Uithoorn, the Netherlands and X-Bots Robotics in Anaheim, California. In 2022, we invested $9.2 million in advancing STEM education, reaching 70% progress toward our commitment to invest $20 million by 2025 to advance racial equity in the U.S. by funding educational pathways for Black communities and people of color.
Our community sustainability investments deliver community transformations through colorful spaces, support essential needs (particularly in times of disaster), and provide opportunities to thrive in the communities where we operate. We activate the time and talent of our employees to make a difference in our local communities. Our COLORFUL COMMUNITIES® program brings together PPG volunteers, PPG products and financial support to provide a fresh coat of paint and rejuvenation to community spaces. We completed 87 projects around the world in 2022, including 36 school makeovers as part of the program’s New Paint for a New Start campaign.
Our Environment |
At PPG, we are committed to using resources efficiently, developing industry-leading sustainable solutions, and prioritizing decarbonization to protect the world for current and future generations.
In 2022, we continued to advance our sustainability strategy, committed to the Science Based Target initiative and submitted Scope 1, 2 and 3 GHG emissions reduction targets for 2030 to the organization for validation. PPG will announce our 2030 sustainability goals in 2023. We also finalized our global sustainability organization, embedding
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8 2023 Proxy Statement | |
sustainability business partners who work with customers to innovate solutions that enable our customers’ sustainability ambitions.
Our sustainable paints, coatings and specialty materials create value and deliver sustainability benefits to our customers, suppliers and a variety of stakeholders. In 2022, we launched several sustainable offerings. One example is PPG INNOVEL® PRO, an internal beverage can coating that does not contain bisphenol-A (BPA) or bisphenol starting substances, and provides enhanced application, leading to less waste for infinitely recyclable aluminum beverage cans. PPG Innovel PRO earned a Cradle to Cradle Certified Material Health Certificate™ at the Platinum level. We have also initiated supplier collaborations to identify more sustainable raw material solutions for our products.
Minimizing the environmental footprint of our operations is an ongoing focus, and our locations are guided by our 2025 sustainability goals. One example of our efforts to introduce more sustainable operations is our Adrian, Michigan, automotive adhesives and sealants manufacturing facility, which entered into a 1.5 megawatt (MW) agreement with Constellation that will help PPG purchase the clean, renewable energy equivalent to the annual electricity use of the facility.
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2022 Achievements | ||||||
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Sustainably Advantaged Products | | | Energy Use | | | Greenhouse Gas |
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39% | | | ⇩8% | | | ⇩16% |
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39% of sales from products and processes with improved sustainability, allowing customers to reduce their environmental impact | | | 8% of reduction in energy use from our 2017 baseline | | | 16% reduction in greenhouse gas emissions from our 2017 baseline |
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Water Withdrawal | | | Spill and Release | | | Waste Efficiency |
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⇩11% | | | ⇩20% | | | ⇩ 21% |
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11% reduction in water withdrawn from our 2017 baseline | | | 20% reduction in PPG’s spill and release rate from our 2017 baseline | | | 21% reduction in the quantity of waste disposed from our 2017 baseline |
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Human Rights | |
We respect the dignity and human rights of all people. As stated in our Global Code of Ethics, available at www.ppg.com, we comply with all laws pertaining to freedom of association, privacy, collective bargaining, immigration, working time, and wages and hours in our operations throughout the world. We also uphold laws prohibiting forced, compulsory and child labor, human trafficking and employment discrimination. We are committed to valuing differences among us in experience, perspective, background, race, age, national origin, religion, sex, sexual orientation, gender identity and/or expression, culture, interests, geography and style. We strive for a collaborative environment in which everyone is embraced for their differences and has an equal chance to succeed. We base employment decisions on job qualifications and merit, which include education, experience, skills, ability and performance. We give equal employment opportunity to – and will not discriminate against – individuals on the basis of any status protected by applicable laws.
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| 2023 Proxy Statement 9 |
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Recognition
PPG’s leadership and progress in key environmental, social and governance (“ESG”) areas has been recognized by reputable external organizations. Our recent awards include:
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EcoVadisTM | | | Human Rights Campaign Foundation | | | Forbes |
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Gold Rating – better than 94% of companies surveyed | | | Perfect Score on 2022 | | | America’s Best Large Employers |
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JUST Capital | | | FTSE4Good® Index Series | | | Newsweek |
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America’s Most JUST Companies 2023 | | | Listed for fourth consecutive | | | List of America’s Most Responsible Companies |
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Disability Equality Index® | | | R&D Magazine’s R&D 100 Awards | | | Forbes |
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Best Place to Work for Disability Inclusion | | | COPPER ARMORTM and Comex VINIMEX® TOTAL antiviral and antibacterial paints | | | America’s Best Employers for Veterans |
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Learn More You can learn more about PPG by visiting our website at www.ppg.com and PPG’s Sustainability Report website at www.sustainability.ppg.com, which highlights the Company’s sustainability achievements and progress against key ESG initiatives. In May, our latest ESG Report will be available with updates on the progress we made in 2022. |
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10 2023 Proxy Statement | |
DIVERSITY OF OUR DIRECTORS
We value boardroom diversity as integral to effective corporate governance. We believe that board diversity – gender, race, age, insight, background and professional experience – is a necessity that improves the quality of decision-making and strategic vision, and represents the kind of company we aspire to be. Our Board of Directors is representative of a diverse group of industries, geographies, cultural backgrounds, ethnic backgrounds, viewpoints and ages. The Nominating and Governance Committee seeks to find director candidates who have demonstrated executive leadership ability and who are representative of the broad scope of shareholder interests by identifying candidates from varied industries having diverse cultural or ethnic backgrounds, viewpoints and ages. The Nominating and Governance Committee believes that the current members of the Board provide this diversity. Below are self-identified diversity characteristics of our directors.
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| Gender | International Origin | Hispanic or | White / | American | Asian | Black or |
ANGEL | M | | | √ | | | |
GRANT | M | √ | | √ | | | |
HEALEY | F | √ | √ | √ | | | |
HEMINGER | M | | | √ | | | |
KNAVISH | M | | | √ | | | |
LAMACH | M | | | √ | | | |
LIGOCKI | F | | | √ | | | |
MCGARRY | M | | | √ | | | |
NALLY | M | | | √ | | | |
NOVO | M | | √ | | | | |
RICHENHAGEN | M | √ | | √ | | | |
SMITH | F | | | √ | √ | | |
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Independence | | | Board Tenure | | | Age |
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10 out of 12 directors are independent | | | Diversity of Board Tenure | | | Mandatory Retirement |
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Board Refreshment | | | Female Committee Chairs |
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9 out of 12 directors have been elected since the end of 2014 | | | 2 out of 4 committees |
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| 2023 Proxy Statement 11 |
Since the end of 2012, the average age of our directors has decreased from 64 to 62 and our average director tenure has decreased from approximately 10 years to approximately seven years. Although our average director tenure has fallen with the addition of new directors, the Board believes that it is important to have longer-serving directors on the Board who have an intimate knowledge of our operations and our corporate philosophy. These longer-serving directors have also guided PPG through the peaks and troughs of the business cycle and can share this experience with our newer directors.
SKILLS, EXPERTISE AND EXPERIENCE OF OUR DIRECTORS
The table below lists some of the key skills, experience and expertise possessed by our directors. The skills listed below are those that are valued by our Board in guiding PPG, a global manufacturer and retailer of high technology paints, coatings and specialty materials for industrial and consumer markets, with operations in approximately 70 countries and approximately $17.7 billion in sales, and in overseeing our strategy for future growth. A checkmark indicates a specific area of focus or expertise on which the Board particularly relies. The biographies of our directors include more information about our directors’ relevant skills, experience and qualifications.
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| Leadership | Finance | Manufacturing | Global | Mergers & Acquisitions | Environment | Retail / | Technology |
Stephen | √ | √ | √ | √ | √ | √ | √ | √ |
Hugh Grant | √ | √ | | √ | √ | √ | √ | √ |
Melanie | √ | √ | √ | √ | | | √ | |
Gary | √ | √ | √ | √ | √ | | √ | |
Timothy | √ | √ | √ | √ | √ | √ | | √ |
Michael | √ | √ | √ | √ | √ | √ | | √ |
Kathleen | √ | √ | √ | √ | √ | √ | √ | √ |
Michael | √ | √ | √ | √ | √ | √ | √ | √ |
Michael | √ | √ | √ | √ | | √ | √ | |
Guillermo Novo | √ | √ | √ | √ | √ | √ | √ | √ |
Martin | √ | √ | √ | √ | √ | | √ | |
Catherine | √ | √ | √ | √ | √ | | √ | |
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12 2023 Proxy Statement | |
PROPOSAL 1: Election of Directorsto Serve in a Class Whose Term Expires in 2025
Five directors are nominated for election to a class that will serve until the 2025 Annual Meeting of Shareholders and until their successors have been duly elected and qualified, or their earlier retirement or resignation. It is intended that the shares represented by each proxy will be voted, in the discretion of the proxies, FOR the nominees for directors set forth below, each of whom is an incumbent, or for any substitute nominee or nominees designated by our Board of Directors in the event any nominee or nominees become unavailable for election. In the event that an incumbent director receives a greater number of votes against their election than votes for such election, they are required to tender their resignation for consideration by the Nominating and Governance Committee of the Board of Directors in accordance with our Bylaws, as under “Director Resignation Policy.” The principal occupations of, and certain other information regarding, the nominees and our continuing directors are set forth below. In addition, information about each director’s specific experience, attributes and skills that led the Board to the conclusion that each of the directors is highly qualified to serve as a member of the Board is set forth below.
The Board believes that each of the Company’s directors is highly qualified to serve as a member of the Board. Each of our directors has contributed to the mix of skills, core competencies and qualifications of the Board. Our directors are highly educated and have diverse backgrounds and talents and extensive track records of success in what we believe are highly relevant positions with some of the most admired organizations in the world. Many of our directors also benefit from an intimate knowledge of our operations and corporate philosophy. The Board believes that each director’s service as the chair, chief executive officer, chief operating officer, president, chief financial officer or group president of a well-respected company has provided the directors with skills that are important to serving on our Board. The Board has also considered the fact that all of our directors have worked for, or served on the boards of directors of, a variety of companies in a wide range of industries. Specifically, the Board has noted that our directors have skills that, among others, have made them particularly suited to serve as a director of PPG, a global manufacturer and retailer of high technology paints, coatings and specialty materials for industrial and consumer markets, with operations in approximately 70 countries and approximately $17.7 billion in sales. The Board believes that through their varying backgrounds, our directors bring a wealth of experiences, new ideas and solutions to our Board.
On October 20, 2022, the Board of Directors elected Timothy M. Knavish as a director of PPG, effective that day, and assigned him to the class of directors who are standing for election at the 2023 Annual Meeting. The Board assigned Mr. Knavish to the class of directors who are standing for election at the 2023 Annual Meeting as a matter of good corporate governance to bring him before the Company’s shareholders at the next annual meeting after his election to the Board.
PPG’s Articles of Incorporation currently provide that the Board shall be divided into three classes as nearly equal in number as possible. At the 2022 Annual Meeting, PPG’s shareholders voted in favor of a Board-sponsored proposal to declassify the Board of Directors. On May 13, 2022, PPG’s Articles of Incorporation were amended to provide that all directors will be elected annually beginning at the 2025 Annual Meeting. The directors to be elected at the 2023 Annual Meeting will be elected to serve a two-year term. The directors to be elected at the 2024 Annual Meeting will be elected to serve a one-year term. At the 2025 Annual Meeting and at each meeting of shareholders thereafter, all directors will be elected annually.
Vote Required
Each director nominee who receives a majority of the votes cast (the number of shares voted “for” the director must exceed 50% of the votes cast with respect to that director) at the Annual Meeting will be elected as a director.
THE BOARD RECOMMENDS THAT SHAREHOLDERS VOTE FOR THE ELECTION |
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| 2023 Proxy Statement 13 |
A Tribute to Steven A. Davis | ||
PPG director Steven A. Davis unexpectedly passed away on July 10, 2022 at the age of 64. Mr. Davis was elected as a director of PPG in 2019 and served on the Audit, Sustainability and Innovation and Nominating and Governance Committees during his tenure. Steve was a respected and trusted member of PPG's Board and our global family. His invaluable expertise and leadership had a dynamic impact on our organization. His involvement also extended deep into our organization through our Black Employee Network and other employee resource networks. Steve also participated in a variety of events and global webcasts involving our employees. His passion to help others grow and succeed made a positive impact throughout our organization and went well beyond his Board role. Earlier in 2022, Davis was included in the 16th Annual Directorship 100™ list of the nation's “Most Influential Corporate Directors and Governance Experts" by The National Association of Corporate Directors. The list recognized the most influential peer-nominated leaders in the boardroom and corporate governance community. Mr. Davis served as Chairman and Chief Executive Officer of Bob Evans Farms from 2006 to 2015. He also held a variety of leadership positions in the restaurant and consumer packaged goods industries, including President of Yum! Brands' Long John Silver's and A&W All-American Food Restaurants and other senior executive and operational positions at Yum! Brands and at Kraft General Foods. At the time of his passing, he served on the boards of directors of Albertsons Companies, Inc., American Eagle Outfitters, Inc., and Marathon Petroleum Corporation. He previously served on the boards of CenturyLink, Inc., Legacy Acquisition Corp., the Sonic Corp and Walgreens Boots Alliance. He also served on the International Board of Directors of the Juvenile Diabetes Research Foundation. | ||
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Nominees to Serve in a Class Whose Term Expires in 2025
The following directors, except Mr. Knavish who was elected to the Board in October 2022, were elected in 2020 for a three-year term expiring at the 2023 Annual Meeting. Under PPG’s amended Articles of Incorporation, at this Annual Meeting these directors will be elected for a two-year term expiring at the 2025 Annual Meeting.
4 | | -performance surface coatings, since October 31, 2018 upon the closing of the combination of Praxair, Inc. with Linde AG to form Linde plc. He served as Chairman of the Board, President and Chief Executive Officer of Praxair, Inc. from 2007 until October 31, 2018. Mr. Angel served as President and Chief Operating Officer of Praxair, Inc. from March to December 2006 and as Executive Vice President of Praxair, Inc. from 2001 to 2006. Prior to joining Praxair, Inc., Mr. Angel spent 22 years in a variety of management positions with General Electric Company. |
Stephen F. Angel | ||
Age: 67 Chairman of the Board of Linde plc | Professional Experience: Mr. Angel has been a Director of PPG since 2010. He has been Chairman of the Board of Linde plc, a global producer and distributor of atmospheric and process gases and high-performance surface coatings, since March 1, 2022. Mr. Angel served as Chief Executive Officer and a director of Linde plc from October 31, 2018 upon the closing of the combination of Praxair, Inc. with Linde AG to form Linde plc until February 28, 2022. He served as Chairman of the Board, President and Chief Executive Officer of Praxair, Inc. from 2007 until October 31, 2018. Mr. Angel served as President and Chief Operating Officer of Praxair, Inc. from March through December 2006 and as Executive Vice President of Praxair, Inc. from 2001 to 2006. Prior to joining Praxair, Inc., Mr. Angel spent 22 years in a variety of management positions with General Electric Company.Mr. Angel is also a director of General Electric Company. | |
Qualifications: Mr. Angel has diverse managerial and operational experience within the manufacturing industry. As the former Chief Executive Officer of Linde plc and a former senior operating executive at General Electric, Mr. Angel understands the challenges faced by a global manufacturer of diversified products, and his experience provides the Board with insight into sales and marketing and operational matters. |
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14 2023 Proxy Statement | |
| | -off of the company in 2002. |
Hugh Grant | ||
Age: 64 Retired Chairman of the Board and Chief Executive Officer of Monsanto Company | Professional Experience: Mr. Grant has been a Director of PPG since 2005. Mr. Grant retired as Chairman of the Board and Chief Executive Officer of Monsanto Company, a global provider of technology-based solutions and agricultural products that improve farm productivity and food quality, on June 7, 2018 upon the closing of the merger of Monsanto Company and Bayer AG. Mr. Grant served as Chairman of the Board and Chief Executive Officer of Monsanto Company from 2003 until June 7, 2018. He previously served as Executive Vice President and Chief Operating Officer of Monsanto Company at the time of an initial public offering in 2000 and remained in that position for the subsequent spin-off of the company in 2002. Mr. Grant is also a director of Freeport-McMoRan Inc. and Linde plc. | |
Qualifications: Mr. Grant has an extensive background in the global agricultural technology industry, having served in various positions at Monsanto Company, where he was the Chairman of the Board and Chief Executive Officer. Mr. Grant brings to the Board significant leadership, corporate governance, managerial and operational expertise gained from years of experience leading the operations of a large multinational company. |
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Melanie L. Healey | ||
Age: 61 Former Group President, North America of The Procter & Gamble Company | Professional Experience: Ms. Healey has been a Director of PPG since 2016. She served as Group President at Procter & Gamble, one of the world’s leading providers of branded consumer packaged goods, from 2007 to 2015, serving as President and Advisor to the Chairman and Chief Executive Officer from January to June 2015; as Group President, North America from 2009 to 2015; and as Group President, Global Feminine and Health Care from 2007 to 2009. She previously served as President, Global Feminine Care and Adult Care Business from 2005 to 2007 and as Vice President and General Manager, Feminine Care North America from 2001 to 2005. Ms. Healey joined Procter & Gamble in 1990. She has more than 30 years of experience in the consumer goods industry having previously held positions with S. C. Johnson & Son, Inc. and Johnson & Johnson. Ms. Healey is also a director of Hilton Worldwide Holdings Inc., Verizon Communications Inc. and Target Corporation. Target Corporation has announced that Ms. Healey will not stand for re-election at Target's 2023 annual meeting of shareholders, which is expected to take place in June 2023. She will continue to serve as a director of Target until her current term on the board expires at Target’s 2023 annual meeting of shareholders. | |
Qualifications: Ms. Healey has extensive experience in the consumer goods industry with three multinational companies. She has a thorough understanding of strategy, branding, consumer marketing and international operations, including 18 years working outside the United States. Ms. Healey brings to the Board significant marketing, brand building, managerial and international expertise gained from years of experience marketing consumer products to customers worldwide. |
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| 2023 Proxy Statement 15 |
Timothy M. Knavish | ||
Age: 57 President and Chief Executive Officer of PPG Industries, Inc. | Professional Experience: Mr. Knavish has been a Director of PPG since October 2022. He has served as the President and Chief Executive Officer of PPG since January 1, 2023. Mr. Knavish served as Chief Operating Officer from March 1, 2022 to December 31, 2022. Mr. Knavish previously served as Executive Vice President from October 2019 through February 2022, Senior Vice President, Architectural Coatings and President, PPG Europe, Middle East and Africa from January 2019 through September 2019, Senior Vice President, Industrial Coatings from October 2017 through December 2018, Senior Vice President, Automotive Coatings from March 2016 through September 2017, Vice President, Protective and Marine Coatings from August 2012 through February 2016 and Vice President, Automotive Coatings, Americas from March 2010 through July 2012. Mr. Knavish joined PPG in 1987. | |
Qualifications: Mr. Knavish has been an employee of PPG for over 35 years and has served in executive level positions at PPG since 2010, providing him with significant knowledge of the coatings industry. He has been a highly successful leader of businesses in both PPG’s Industrial Coatings and Performance Coatings segments, serving in a variety of key business and functional leadership roles in the United States, Europe and the Asia Pacific region. Mr. Knavish has been integral to PPG’s recent acquisition strategy, having led the acquisitions and integrations of Tikkurila Oyj, expanding PPG’s leading European position into Scandinavia, and Ennis-Flint to form PPG’s traffic solutions business. Mr. Knavish also has led PPG’s efforts to enhance PPG’s sales capabilities and digital offerings. |
Guillermo Novo | ||
Age: 60 Chairman and Chief Executive Officer of Ashland Inc. | Professional Experience: Mr. Novo has been a Director of PPG since 2021. He has been Chairman and Chief Executive Officer of Ashland Inc. (formerly known as Ashland Global Holdings Inc.), a leading, global manufacturer of specialty materials for customers in a wide range of consumer and industrial markets, including architectural coatings, construction, energy, food and beverage, nutraceuticals, personal care and pharmaceuticals, since December 31, 2019. Prior to becoming Chairman and Chief Executive Officer, Mr. Novo was an independent director of Ashland, joining the board in May 2019. Mr. Novo served as the President and Chief Executive Officer and a director of Versum Materials, Inc. from 2016 until its sale in 2019. Previously, Mr. Novo served as Executive Vice President, Materials Technologies of Air Products and Chemicals, Inc. from 2014 to 2016, leading the spin-off of Versum Materials from Air Products and Chemicals. He joined Air Products and Chemicals in 2012 as Senior Vice President, Electronics, Performance Materials, Strategy and Technology. Prior to joining Air Products and Chemicals, Mr. Novo was employed by the Dow Chemical Company where he most recently served as Group Vice President, Dow Coating Materials. He began his career in 1986 with Rohm and Haas Company (which merged with Dow in 2009) and held a variety of commercial, marketing, and general management positions, living in South America, the United States and Asia. In 1998, Mr. Novo was named a Vice President at Rohm and Haas, and in 2006 he became a corporate officer and one of five group executives on the corporate leadership team responsible for driving the overall strategy for the company. Mr. Novo served as a director of Versum Materials, Inc. from 2016 to 2019 and as a director of Bemis Company, Inc. from 2018 to 2019 when Bemis was acquired by Amcor plc. | |
Qualifications: Mr. Novo’s over 30 years in the specialty chemicals and specialty materials industry brings to the Board extensive understanding of our business, including the perspective of a strategic raw material supplier to the specialty chemicals industry. He also has significant experience and knowledge in the areas of business strategy, mergers and acquisitions in the chemicals industry, global business operations, manufacturing and corporate governance. |
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16 2023 Proxy Statement | |
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Continuing Directors—Term Expires in 2024
The following directors were elected in 2021 for a three-year term expiring at the 2024 Annual Meeting. Under PPG’s amended Articles of Incorporation, at the 2024 Annual Meeting these directors will be elected for a one-year term expiring at the 2025 Annual Meeting.
Michael W. Lamach | ||
Age: 59 Retired Executive Chair and Chief Executive Officer of Trane Technologies plc | Professional Experience: Mr. Lamach has been a Director of PPG since 2015. He served as Executive Chair of Trane Technologies plc, a global leader in climate control and climate-focused innovations for buildings, homes and transportation, from July 1, 2021 until his retirement on December 31, 2021. Previously, Mr. Lamach served as Chairman and Chief Executive Officer of Trane Technologies from its separation from Ingersoll-Rand plc in February 2020 to July 1, 2021. Mr. Lamach served in several roles with Ingersoll-Rand, including Chairman and Chief Executive Officer from June 2010 to February 2020, Director from February 2010 to February 2020, President and Chief Executive Officer from February 2010 to June 2010; President and Chief Operating Officer from February 2009 to February 2010; President of Trane Commercial Systems from June 2008 to February 2009; and President of the Security Technologies Sector from February 2004 to June 2008. Prior to joining Ingersoll-Rand, Mr. Lamach spent 17 years in a variety of management positions with Johnson Controls. Mr. Lamach is also a director of Nucor Corporation. He served as a director of Iron Mountain, Inc. from 2007 to 2015 and as Chair of the Board of the National Association of Manufacturers. | |
Qualifications: During his career, Mr. Lamach led a number of businesses serving different end-use markets, including automotive components, controls, security systems and HVAC systems. As former Chairman and Chief Executive Officer of Trane Technologies plc and previously of Ingersoll-Rand plc, he brings to the Board experience leading global companies that sell a diverse range of products and services to both industrial and consumer customers. Mr. Lamach’s past service as the Chair of the Board of the National Association of Manufacturers provides him with keen insight into the challenges facing manufacturers. |
Martin H. Richenhagen | ||
Age: 70 Retired Chairman, President and Chief Executive Officer of AGCO Corporation | Professional Experience: Mr. Richenhagen has been a Director of PPG since 2007. He served as Chairman, President and Chief Executive Officer of AGCO Corporation, an agricultural equipment manufacturer from 2006 through December 2020. From 2004 to 2006, he served as President and Chief Executive Officer of AGCO. From 2003 to 2004, Mr. Richenhagen was Executive Vice President of Forbo International SA, a Swiss flooring materials company. From 1998 to 2003, he was with CLAAS KgaA MbH, a German-based manufacturer of agricultural and forest machinery, serving as Group President from 2000 until 2003. Mr. Richenhagen is also a director of Linde plc, Daimler Truck Holding AG and Chair of the Board of Axios Sustainable Growth Acquisition Corporation. Mr. Richenhagen was a director of Praxair, Inc. from 2015 until the closing of its combination with Linde AG in October 2018 to form Linde plc. | |
Qualifications: Mr. Richenhagen led global manufacturing companies for many years. As Chairman, President and Chief Executive Officer of AGCO Corporation, he led a global manufacturer of agricultural equipment with dealers and distributors in more than 140 countries worldwide. Mr. Richenhagen brings considerable international business experience to the Board, having served as a senior executive at multinational companies located in Europe and the United States. |
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| 2023 Proxy Statement 17 |
Catherine R. Smith | ||
Age: 59 Chief Financial and Administrative Officer of Bright Health Group, Inc. | Professional Experience: Ms. Smith has been a Director of PPG since 2019. She has been Chief Financial and Administrative Officer of Bright Health Group, Inc., a diversified, consumer-focused healthcare company providing a broad range of benefits and services to consumers and care providers in local markets throughout the United States, since January 2020. Prior to joining Bright Health, Ms. Smith was Executive Vice President and Chief Financial Officer of Target Corporation, a customer-centric, omnichannel retailer with approximately 2,000 stores in the United States, from September 2015 to November 2019. From February to December 2014, Ms. Smith was Executive Vice President and Chief Financial Officer of Express Scripts Holding Company, a Fortune 20 company and the United States’ largest pharmacy benefit manager, leaving the company in March 2015. Prior to Express Scripts, Ms. Smith held Chief Financial Officer positions at Walmart International, GameStop Corp., Centex Corp. and others. Ms. Smith is also a director of Baxter International Inc. | |
Qualifications: Ms. Smith has significant expertise gained from years of leading the complex finance organizations of some of the largest companies in the United States. Her experience in financial reporting, accounting and internal controls brings valuable expertise to the Board. In addition, Ms. Smith has extensive experience leading retail companies with a national and international footprint similar to that of PPG. |
Continuing Directors—Term Expires in 2025
The following directors were elected in 2022 for a three-year term expiring at the 2025 Annual Meeting. Under PPG���s amended Articles of Incorporation, at the 2025 Annual Meeting these directors will be elected for a one-year term expiring at the 2026 Annual Meeting.
consolidated master limited partnerships formed by Marathon Petroleum Corporation. | ||
Gary R. Heminger | ||
Age: 69 Retired Chairman and Chief Executive Officer of Marathon Petroleum Corporation | Professional Experience: Mr. Heminger has been a Director of PPG since 2017. Mr. Heminger retired as Chairman and Chief Executive Officer of Marathon Petroleum Corporation in April 2020. He became Chief Executive Officer of Marathon Petroleum in 2011 and became Chairman of the Board in 2016. Marathon Petroleum is one of the largest independent petroleum product refining, marketing, retail and pipeline transportation companies in the United States. Mr. Heminger spent over 45 years in a variety of leadership, financial and marketing positions with Marathon Petroleum. From 2011 to 2017, he served as President and Chief Executive Officer of Marathon Petroleum Corporation, and from 2001 to 2011, Mr. Heminger served as both Executive Vice President – Downstream, Marathon Oil Corporation and as President of Marathon Petroleum Company LLC. Previously, he served as Executive Vice President, Supply, Transportation and Marketing for Marathon Ashland Petroleum from January to September 2001; as Senior Vice President, Business Development from 1999 to January 2001; and as Vice President, Business Development from 1998 to 1999. From 2012 to April 2020, Mr. Heminger also served as Chairman of the Board and Chief Executive Officer of MPLX GP LLC, a wholly owned, indirect subsidiary of Marathon Petroleum and the general partner of MPLX LP, a consolidated master limited partnership formed to own and operate midstream energy infrastructure assets. Mr. Heminger is also a director of Fifth Third Bancorp. | |
Qualifications:Mr. Heminger has significant leadership and financial expertise gained from years of service at a large petroleum product refining, transport, marketing and retail company. His over 40 years of experience leading a complex manufacturing and marketing business provides useful guidance in managing PPG’s complex organization with many of the same challenges and opportunities as faced by PPG. Mr. Heminger also brings to the Board marketing and retail expertise gained from overseeing Marathon Petroleum Corporation’s former network of gasoline retail locations and convenience stores. |
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| , and from 2012 to 2014 she was an operating partner at Kleiner Perkins Caufield & Byers, a top venture capital firm. From 2010 to 2012, Ms. Ligocki was President and Chief Executive Officer and a director of Next Autoworks, a start-up automobile manufacturer. From 2008 to 2010, she served as principal at Pine Lake Partners, a consultancy for start-up companies, and from 2008 to 2009 she was President and Chief Executive Officer of start-up Mexican automobile manufacturer and retailer, GS Motors, owned by Grupo Salinas, a Mexican conglomerate. From 2003 to 2007, Ms. Ligocki was Chief Executive Officer of Tower Automotive, a Fortune 1000 automotive supplier. Her previous experience includes executive leadership positions in global operations at Ford Motor Company and United Technologies Corporation as well as various leadership roles at General Motors Corporation. Ms. Ligocki is also a director of Lear Corporation and Carpenter Technology Corporation and served as a director of Ashland Inc. from 2004 to 2014. | |
Kathleen A. Ligocki | ||
Age: 66 Former Chief Executive Officer of Agility Fuel Solutions, LLC | Professional Experience: Ms. Ligocki has been a Director of PPG since 2020. Ms. Ligocki served as Chief Executive Officer of Agility Fuel Solutions, LLC, a leading manufacturer of natural gas solutions for medium and heavy-duty vehicles in North America, from 2015 to 2019. From 2014 to 2015, she was President and Chief Executive Officer and a director of start-up company, Harvest Power, Inc., a leading organic waste management company in North America, and from 2012 to 2014 she was an operating partner at Kleiner Perkins Caufield & Byers, a top venture capital firm. From 2010 to 2012, Ms. Ligocki was President and Chief Executive Officer and a director of Next Autoworks, a start-up automobile manufacturer. From 2008 to 2010, she served as principal at Pine Lake Partners, a consultancy for start-up companies, and from 2008 to 2009 she was President and Chief Executive Officer of start-up Mexican automobile manufacturer and retailer, GS Motors, owned by Grupo Salinas, a Mexican conglomerate. From 2003 to 2007, Ms. Ligocki was Chief Executive Officer of Tower Automotive, a Fortune 1000 automotive supplier. Her previous experience includes executive leadership positions in global operations at Ford Motor Company and United Technologies Corporation as well as various leadership roles at General Motors Corporation. Ms. Ligocki is also a director of Carpenter Technology Corporation and Lear Corporation. She served as a director of Qell Acquisition Corp. from October 2020 to December 2021 and as a director of Ashland Inc. from 2004 to 2014. | |
Qualifications: Ms. Ligocki has diverse senior leadership experience in the automotive and transportation industry, a key customer for PPG’s products. As the chief executive officer of several start-up and early stage companies, she brings to the Board significant understanding of the importance of innovation and the process of bringing new ideas to market. Ms. Ligocki also has substantial experience managing the manufacturing and operations of multinational companies. |
Michael H. McGarry | ||
Age: 65 Executive Chairman and former Chairman and Chief Executive Officer of PPG Industries, Inc. | Professional Experience: Mr. McGarry has been a Director of PPG since 2015. Mr. McGarry became Executive Chairman of PPG on January 1, 2023. He served as Chairman and Chief Executive Officer of PPG from September 1, 2016 to December 31, 2022. Previously, he served as President and Chief Executive Officer from September 1, 2015 to September 1, 2016, President and Chief Operating Officer from March 2015 until September 1, 2015 and Chief Operating Officer from August 2014 until March 2015. Mr. McGarry has also served as Executive Vice President from 2012 until 2014; Senior Vice President, Commodity Chemicals from 2008 until 2012; Vice President, Coatings, Europe, and Managing Director, PPG Europe from 2006 until 2008; and Vice President, Chlor-Alkali and Derivatives from 2004 to 2006. He joined PPG in 1981. Mr. McGarry is also a director of United States Steel Corporation and Shin-Etsu Chemical Co. Ltd. and served as a director of Axiall Corporation from 2013 through August 2016. He also served as Chairman of the American Coatings Association. | |
Qualifications: Mr. McGarry has been an employee of PPG for over 40 years and has served in executive level positions at PPG since 2004, providing him with a nearly unparalleled knowledge of the coatings industry. He has served in a variety of key business and functional leadership roles in the United States, Europe and Asia. Mr. McGarry has been at the forefront of PPG’s portfolio transformation, having led: the acquisition of SigmaKalon; the separation of PPG’s former commodity chemicals business; the acquisition and integration of AkzoNobel’s North American architectural coatings business; the acquisition of Consorcio Comex, S.A. de C.V.; and the dispositions of PPG’s flat glass and fiber glass businesses. Mr. McGarry also has extensive product stewardship, manufacturing and logistics experience gained through years of working in PPG’s former commodity chemicals business. |
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| 2023 Proxy Statement 19 |
Michael T. Nally | ||
Age: 47 Chief Executive Officer and Director of Generate Biomedicines, Inc. and CEO-partner of Flagship Pioneering | Professional Experience: Mr. Nally has been a Director of PPG since 2021. He has been Chief Executive Officer of Generate Biomedicines, Inc., a company that uses machine learning algorithms to design biological compounds to combat disease, since March 31, 2021. Previously, Mr. Nally was Executive Vice President and Chief Marketing Officer of Merck & Co., Inc., a leading, global health care company that delivers innovative health solutions through prescription medicines, vaccines, biologic therapies and animal health products, from January 2019 to March 31, 2021. Mr. Nally led Merck’s human health business and was responsible for developing Merck’s growth strategy and commercialization model. From September 2016 to January 2019, Mr. Nally served as President, Global Vaccines and delivered significant business growth and a dramatic increase in the reach and public health impact of pediatric, adolescent and adult vaccines. He served as Managing Director, United Kingdom and Ireland from January 2014 through August 2016. Previously, Mr. Nally served in key management positions in strategic initiatives, commercial operations, business development and investor relations after joining Merck in 2003. | |
Qualifications: Mr. Nally’s leadership experience in the pharmaceutical industry brings to the Board extensive understanding of the research and development process and the importance of product innovation to growth. He also has valuable experience commercializing new technologies and marketing products to consumers. Mr. Nally also has experience managing significant global businesses for a multinational company. |
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20 2023 Proxy Statement | |
CORPORATE GOVERNANCE
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Our Governance Highlights | ||||
√ | 10 of 12 directors are independent | | √ | Board oversight of Company strategy |
√ | All Board committee members are independent | | √ | Annual Board and committee self-evaluations |
√ | Majority voting in uncontested elections | | √ | Extensive shareholder engagement |
√ | No dual class structure; each shareholder gets one vote per share | | √ | Independent directors regularly meet without management present |
√ | Proxy access right with market terms | | √ | No poison pill |
√ | Strong independent Lead Director with clearly defined duties that are publicly disclosed | | | |
BOARD OF DIRECTORS | ||||
Chairman: Michael H. McGarry | | Board’s Emphasis on Strategy PPG’s Board is actively engaged in developing our strategy and overseeing its execution, including major business and organizational initiatives, capital allocation priorities and potential business development opportunities. The Board devotes at least one full day each year to reviewing and formulating our strategy. Throughout the year, the Board uses its experience in manufacturing, global business, science and technology, and marketing to oversee the execution of our strategy and capital allocation and works with senior management to guide our strategy. | ||
Independent Lead Director:Hugh Grant | | | ||
Meetings: 8 | | |||
10 of 12 PPG Directors are Independent | | |||
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√Our independent directors meet separately, without any management present, at each meeting of the Board. | | |||
√Each of the Board’s standing committees regularly meets without members of management present. | | |||
√Management succession is regularly discussed by the Board with Mr. McGarry, Mr. Knavish and PPG’s Vice President and Chief Human Resources Officer. | | |||
√The Lead Director presides over the independent director sessions at each meeting and facilitates communications and serves as a liaison between the independent directors, the Executive Chairman and the Chief Executive Officer. | | | ||
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99% | | The average attendance at meetings of the Board and committees during 2022 was 99%, and no incumbent director attended less than 75% of the total number of meetings of the Board and committees on which such director served. PPG does not have a formal policy requiring attendance at the annual meeting of shareholders; however, all directors serving at the time of the 2022 Annual Meeting of Shareholders attended the meeting. |
Board Composition, Refreshment and Diversity
PPG’s business, property and affairs are managed under the direction of the Board of Directors. The Board is currently comprised of 12 members, divided into three classes. Terms of the classes are staggered, with one class standing for election each year. At the Company’s 2022 Annual Meeting, shareholders approved a Board-sponsored proposal to amend PPG’s Articles of Incorporation to provide for the annual election of all directors. Pursuant to PPG’s amended Articles of Incorporation, all directors will be elected annually beginning at PPG’s 2025 Annual Meeting. The Board is elected by our shareholders to oversee management of the Company in the long-term interests of all shareholders. The Board also considers the interests of other stakeholders, which include customers, employees, retirees, suppliers, the communities we serve and the environment. The Board strives to ensure that PPG conducts business in accordance with the highest standards of ethics and integrity.
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| 2023 Proxy Statement 21 |
The Board seeks to maintain an appropriate balance of directors with varying tenure, diversity and skills. The Nominating and Governance Committee continually evaluates potential director candidates with the goal of finding directors whose skills complement the skills of PPG’s current directors, who add to the expertise of the Board as a whole and who have experience to contribute insight into our strategy. Using a skills matrix that includes the experience and skills of our current directors and keeping in mind the skills that the Board believes would add to the capabilities and knowledge of our Board, the Nominating and Governance Committee regularly reviews the skills and experience of our directors and potential director candidates. More information about the skills and experience of our directors can be found in the matrix on page 12 and within the biographies of our directors beginning on page 14.
Our Corporate Governance Guidelines require that any director who has attained the age of 72 retire at the next annual meeting following the director's 72nd birthday. Nine new directors have joined the Board since the end of 2014. Since the end of 2012, the average age of our directors has decreased from 64 to 62 and our average director tenure has decreased from approximately 10 years to approximately seven years. Although our average tenure has fallen with the addition of new directors, the Board believes that it is important to have longer-serving directors on the Board who have an intimate knowledge of our operations and our corporate philosophy. These longer-serving directors have also guided PPG through the peaks and troughs of the business cycle and can share this experience with our newer directors.
The Nominating and Governance Committee does not a have formal policy with regard to the consideration of diversity in identifying director candidates. However, we endeavor to have a Board representing diverse experience at policy-making levels in business, government, education and technology, and in areas that are relevant to the Company’s global activities. The Nominating and Governance Committee seeks to find director candidates who have demonstrated executive leadership ability and who are representative of the broad scope of shareholder interests by identifying candidates from varied industries having diverse cultural or ethnic backgrounds, viewpoints and ages. The Nominating and Governance Committee believes that the current members of the Board provide this diversity as discussed more specifically on page 11.
Director Independence
In accordance with the rules of the New York Stock Exchange, the Board affirmatively determines the independence of each director and nominee for election or appointment as a director in accordance with the categorical guidelines it has adopted, which include all objective standards of independence set forth in the exchange listing standards. Based on these standards, at its meeting held on February 16, 2023, the Board determined that each of the following non-employee directors is independent and has no material relationship with PPG, except as a director and shareholder:
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Stephen F. Angel | Kathleen A. Ligocki | ||||||
Hugh Grant | Michael T. Nally | ||||||
Melanie L. Healey | Guillermo Novo | ||||||
Gary R. Heminger | Martin H. Richenhagen | ||||||
Michael W. Lamach
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Catherine R. Smith
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In addition, based on such standards, the Board affirmatively determined that Michael H. McGarry and Timothy M. Knavish are not independent because they are officers of PPG. The categorical independence standards adopted by the Board are contained in the Corporate Governance Guidelines, which may be accessed from the Corporate Governance section of our website at investor.ppg.com.
Board Leadership Structure
We believe our Board leadership structure provides the appropriate balance of independent directors and management directors. Throughout 2022, we had a traditional board leadership structure under which Mr. McGarry served as our Chairman of the Board and Chief Executive Officer. Beginning on January 1, 2023, Mr. McGarry became PPG’s Executive Chairman and Mr. Knavish became PPG’s President and Chief Executive Officer. Having a combined position of Chairman and Chief Executive Officer or an Executive Chairman is only one element of our leadership structure, which also includes an independent Lead Director and active, independent non-employee directors. We currently have 10 non-employee directors, each of whom is independent. Our Board has four standing committees, each of which is comprised solely of independent directors with an independent committee chair. The Board has determined that the appropriate structure for the Board at this time is for Mr. McGarry, our former Chief Executive Officer, to serve as Executive Chairman of the Board, while also providing for the counterbalance of a strong independent Lead Director role, fully independent Board committees, and other good governance practices.
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22 2023 Proxy Statement | |
The Board believes that Mr. McGarry is the best person to serve as Chairman because he is the director most familiar with our business and industry and the director most capable of identifying strategic priorities, communicating these to the Board and executing our business strategy. The Board believes Mr. McGarry’s service as Executive Chairman creates a highly effective bridge between the Board and management and provides the leadership to execute our business strategy and create shareholder value. In addition, having Mr. McGarry continue to serve as Executive Chairman demonstrates to our employees, suppliers, customers, shareholders and other stakeholders that PPG has undertaken a thoughtful and measured leadership transition. Mr. McGarry’s Board leadership will allow for the continued, orderly transition of the Chief Executive Officer role to Mr. Knavish and will allow Mr. McGarry to continue to mentor Mr. Knavish as he begins his tenure as PPG’s Chief Executive Officer. Having Mr. McGarry serve as Executive Chairman also provides the Board time to consider the best Board leadership approach for PPG after Mr. McGarry retires based on the Company’s current circumstances.
Our Board consists of directors with significant leadership skills, as discussed above. All of our independent directors have served as the chairman, chief executive officer, president, chief financial officer or group president of other companies. Accordingly, we believe that our independent directors have demonstrated leadership in large enterprises and are well versed in board processes and that having directors with significant leadership skills benefits our Company and our shareholders.
In accordance with our Bylaws and our Corporate Governance Guidelines, the Chairman is responsible for chairing Board meetings and setting the agenda for these meetings. Each director also may suggest items for inclusion on the agenda and may raise at any Board meeting subjects that are not on the agenda for that meeting. As required by our Corporate Governance Guidelines, our independent directors meet separately, without management present, at each meeting of the Board. In addition, each of the Board’s standing committees regularly meets without members of management present.
The Board has designated the chair of the Nominating and Governance Committee to serve as the Lead Director. In their discretion, the independent directors may select another independent director to serve as the Lead Director. Aside from chairing meetings of the independent directors, the Lead Director:
● | presides at all meetings where the Chairman is not present; |
● | facilitates communications and serves as a liaison between the independent directors, the Executive Chairman and the Chief Executive Officer; |
● | has the power to call meetings of the independent directors; |
● | communicates to the Executive Chairman and the Chief Executive Officer any suggestions, views or concerns expressed by the independent directors and consults with the Executive Chairman and the Chief Executive Officer about the concerns of the Board; |
● | advises the Executive Chairman and the Chief Executive Officer as to the information necessary or appropriate for the independent directors to effectively and responsibly perform their duties and provides feedback on the quality, quantity and timeliness of information submitted by management; |
● | approves Board meeting agendas and other types of information sent to the Board; |
● | approves meeting schedules to assure that there is sufficient time for discussion of all agenda items; |
● | is available for consultation and direct communication with major shareholders as appropriate; |
● | participates in the identification and evaluation of director candidates and facilitates director development; |
● | acts as a resource and advisor to the Executive Chairman and the Chief Executive Officer; |
● | unless otherwise directed by the Board, serves as the independent directors’ representative in extraordinary matters such as significant corporate transactions and crisis situations; |
● | recommends to the Board the formation and membership of ad-hoc committees of the Board to oversee extraordinary matters such as significant corporate transactions and crisis situations; |
● | authorizes the retention of outside advisors and consultants who report directly to the Board on Board-wide issues; |
● | actively participates in the Board’s review of acquisition opportunities and the management succession process; and |
● | performs such other duties as the Board may from time to time designate. |
As part of its annual self-evaluation process, the Board, at least annually, evaluates our leadership structure to ensure that it provides the optimal structure for PPG. We believe that having a director with day-to-day oversight of Company
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| 2023 Proxy Statement 23 |
operations, coupled with experienced independent directors who have appointed a Lead Director and four wholly-independent board committees, is the appropriate leadership structure for PPG.
Shareholder Engagement
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Through engagement with our shareholders, the Board and our senior management team are provided with feedback on a variety of topics, including: ● strategic and financial performance ● operations ● corporate governance ● executive compensation ● Board composition ● sustainability ● diversity, equity and inclusion | | | | | ||||||
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| | | Percentage of our outstanding shares held by active, institutional investors with whom we met in 2022. | | | Percentage of our outstanding shares held by institutional investors with whom we held governance-focused meetings in 2022. | ||||
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These constructive engagements enable the Board and management to evaluate and assess our Company from different perspectives and viewpoints. Our Lead Director, Hugh Grant, participated in a number of these governance-focused meetings. The key themes of feedback received during our engagement meetings as well as efforts we are taking in consideration of the feedback we received were shared with the Board. These initiatives help to ensure that the Board is apprised of key trends and topics being considered by our shareholders. A general outline of our approach to shareholder engagement can be found below. | ||||||||||
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Before the Annual Meeting of Shareholders | At the Annual Meeting of Shareholders | After the Annual Meeting of Shareholders | ||||||||
● We reach out to investors to discuss key issues facing our Company and industry ● Together, the Board and senior management discuss shareholder feedback and determine if additional actions are required ● Management institutes changes as appropriate | | Our shareholders: ● elect eligible nominees to join the Board of Directors ● vote on executive compensation ● vote on the ratification of our auditors ● potentially vote on other proposals brought by management or by our shareholders | | ● We tabulate and review the voting results ● Together, the Board and senior management discuss the results and determine what additional actions are appropriate ● We prepare our agenda for further shareholder engagement |
The Board’s Role in ESG
Our Board is actively engaged in our ESG programs and initiatives. Our ESG approach is grounded in our vision of delivering lasting value for stakeholders and customers by operating with integrity, working safely, respecting the contributions of our people, preserving the environment and supporting the communities where we operate. Our ESG
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oversight structure is designed to effectively govern and manage the ESG risks and opportunities that are integral to our business strategy, and Board oversight of significant ESG matters is incorporated into its oversight of our business and our strategy. Significant ESG risks are reviewed and evaluated by the Board and its committees as part of their ongoing risk oversight of our Company.
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Framework for Board oversight of ESG | | Environmental | Social | Governance | | ||||||
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| | Sustainability and | PPG Board | Nominating and | | | |||||
| Employee health and safety Environmental programs Product stewardship Remediation activities Sustainability programs and performance Climate change risks and opportunities | | Corporate governance oversight Recommending new directors and executive officers Government affairs and political activities Shareholder engagement ESG program governance | | | ||||||
| | ESG strategy Succession planning Diversity, equity and inclusion Community engagement and | | | | ||||||
| | Human Capital Management | | Audit Committee | | | | ||||
| Culture and purpose Employee engagement Employee development Executive compensation Pay equity | | Enterprise risk management Cybersecurity Data privacy | | |
In 2021, the Board conducted a comprehensive review of its oversight of the Company’s ESG programs and practices to ensure that the Board or one of its committees has oversight responsibility for each of the ESG programs and practices that is significant to PPG. As a result of this review, the Board in 2021 revised our Corporate Governance Guidelines and the charters of each committee to more clearly specify the ESG programs and practices overseen by the Board and each of its committees. The Nominating and Governance Committee actively monitors the changing ESG landscape and recommends changes to PPG’s governance programs and practices.
The Board’s long-standing Sustainability and Innovation Committee (formerly known as the Technology and Environment Committee) oversees and receives regular updates on the Company’s environment, health, safety, product stewardship and sustainability initiatives, including the Company’s sustainability goals and progress toward our goals. In connection with its review of our ESG oversight program, the Board selected the Sustainability and Innovation Committee as the committee with responsibility for reviewing the risks and opportunities to PPG of the effects of climate change.
PPG recognizes the importance of corporate culture and diversity, equity and inclusion efforts to our success. The Board has been focused on employee engagement and provided its guidance in connection with the formulation and introduction of The PPG Way. Since the introduction of The PPG Way, the Board has received regular updates on our engagement progress. The Board has also endorsed our recent diversity, equity and inclusion actions, including hiring an executive level Global Head of Diversity, Equity and Inclusion, reporting of our diversity, equity and inclusion programs, achievements and statistics and the PPG Industries Foundation’s commitment to organizations focusing on social justice. In 2021, the Board repositioned the Officers-Directors Compensation Committee as the Human Capital Management and Compensation Committee and expanded its responsibilities to include oversight of our human capital strategies in the areas of culture and purpose, employee engagement, development and pay equity.
Our aim is to bring color and brightness to communities around the world. The PPG Industries Foundation is the primary vehicle for our U.S. community engagement efforts. The PPG Industries Foundation distributes over $6 million in donations annually and manages our COLORFUL COMMUNITIES® program. The Board has oversight responsibility for the PPG Industries Foundation and also receives updates on PPG’s other community engagement and global giving initiatives.
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| 2023 Proxy Statement 25 |
PPG engages in the political process when we believe that doing so will serve the best interests of the Company and our stakeholders. We support public policies that contribute to the achievement of our long-term growth. The Nominating and Governance Committee has been assigned responsibility to oversee our government affairs activities and to receive periodic reports regarding the activities of our Government Affairs team. More information about PPG’s political activities, including PPG’s Political Contributions and Activities Policy and political spending reports, are available on our Government Affairs website at http://corporate.ppg.com/Our-Company/Government-Affairs.aspx.
Each Board committee will report its activities in these areas back to the full Board of Directors.
At the management level, day-to-day implementation of our ESG initiatives is led by our Vice President, Global Sustainability, a new position created in 2021 to coordinate PPG’s ESG and sustainability programs and to communicate our ESG progress with our customers, shareholders and other stakeholders. The Vice President, Global Sustainability works with PPG’s Sustainability Committee, a committee of management consisting of senior corporate executives, to establish and monitor our sustainability goals, policies, programs and procedures that incorporate sustainability into our business practices, including resource management, climate change impacts, innovation, communications, community engagement, procurement, manufacturing and employee wellness.
Board Oversight of PPG’s Strategy
PPG’s Board is actively engaged in developing and overseeing the execution of our strategy, including major business and organizational initiatives, capital allocation priorities and potential business development opportunities. Throughout the year, the Board applies its experience in manufacturing, global business, science and technology and marketing to oversee the execution of our strategy and capital allocation and works with senior management to guide our strategy. At its October meeting, the Board devotes one full day to reviewing and formulating our strategy. At each Board meeting and during our annual strategy session, directors engage with PPG’s senior leadership in robust discussions about the Company’s overall strategy, priorities for its businesses and long-term growth opportunities.
The Board’s Role in Risk Management
Management | Our management team, led by the Enterprise Risk Committee, is responsible for the day-to-day management of risk. | Board of Directors | |||||
Our Board has broad oversight responsibility for our risk-management programs. While the Audit Committee has primary responsibility for overseeing our enterprise risk assessment and management process, our entire Board is actively involved in overseeing risk management for the Company by engaging in periodic discussions with Company officers and other employees as the Board may deem appropriate. We believe that the leadership structure of our Board supports the Board’s effective oversight of the Company’s risk management. | |||||||
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Audit Committee Focuses on risks inherent in our accounting, financial reporting, legal and regulatory compliance, cybersecurity, data privacy and internal controls. | | Sustainability and Innovation Committee Considers risks related to our environment, health, safety, product stewardship, climate change and our sustainability programs. Reviews our approach to innovation, science and technology. | | Human Capital Management and Compensation Committee Considers the risks that may be implicated by our executive compensation and human capital management programs. |
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● ● |
Special Role of Audit Committee: ● In accordance with New York Stock Exchange requirements, our Audit Committee charter provides that the Audit Committee is responsible for overseeing our risk management process. ● The Audit Committee is updated on a regular basis on relevant and significant risk areas. This includes periodic updates from certain officers of the Company and a formal annual update by the Director, Corporate Audit Services (the leader of PPG’s internal audit function). The annual update provides a comprehensive review of PPG’s enterprise risks and includes the feedback from the Company’s officers and key managers. The Audit Committee, in turn, reports to the full Board. |
PPG’s Enterprise Risk Committee (“ERC”), a committee of management, has overall management responsibility for PPG’s enterprise risk management processes. The membership of the ERC includes the Executive Committee of the Company and the Director, Corporate Audit Services. Its responsibilities include:
● | developing and fostering PPG’s risk management culture; |
● | identifying and monitoring the risks to PPG; |
● | monitoring PPG’s risk management capabilities and crisis preparedness and recovery plans; |
● | reviewing the steps management has taken to monitor and control major risk exposures, including the Company’s risk assessment and risk management policies; and |
● | reviewing and assessing the effectiveness of PPG’s enterprise-wide risk assessment processes. |
The ERC provides updates on its key activities and PPG’s enterprise risk management programs and risk posture to the Board or its committees, as appropriate.
Executive Succession Planning
One of the Board’s primary responsibilities is to oversee the development of appropriate executive-level talent to successfully execute PPG’s strategy. Management succession is regularly discussed by the Board with the Executive Chairman, the President and Chief Executive Officer and PPG’s Vice President and Chief Human Resources Officer. The Board reviews candidates for all executive officer positions to confirm that qualified successor-candidates are available for all key positions and that development plans are being utilized to strengthen the skills and qualifications of successor-candidates. At least annually, as required by our Corporate Governance Guidelines, and typically more often, the Board’s discusses Chief Executive Officer succession planning. The current Chief Executive Officer provides the Board with recommendations for and evaluations of potential Chief Executive Officer successors and reviews with the Board development plans for these successors. Directors engage with potential Chief Executive Officer and senior management talent at Board and committee meetings and in less formal settings to enable directors to personally interact with candidates. The Board reviews management succession in the ordinary course of business as well as contingency planning in the event of an emergency or unanticipated event.
Corporate Governance Guidelines, Board Self-Evaluation and Board Orientation
The Board has adopted Corporate Governance Guidelines. These guidelines are revised from time to time to better address particular needs as they change over time. The Board revised the Corporate Governance Guidelines in 2021 to clarify the ESG responsibilities of the Board of Directors. The Corporate Governance Guidelines may be accessed from the Corporate Governance section of our website at investor.ppg.com.
The Board annually evaluates its own performance and that of its standing committees. The evaluation process is coordinated by the Nominating and Governance Committee and has three parts: committee self-assessments, full Board evaluations and evaluations of the individual directors in the class whose term is expiring at the next annual meeting. The committee self-assessments consider whether and how well each committee has performed the responsibilities listed in its charter. The full Board evaluations consider the committee self-assessments as well as the quality of the Board’s meeting agendas, materials and discussions. All assessments and evaluations focus on both strengths and opportunities for improvement and are shared with the Board.
The Board has a program for orienting new directors which includes presentations from members of senior management regarding our operations, technologies, governance, finances, compensation programs and other topics of interest to our new directors. The Company also provides for continuing education for all directors, including the reimbursement of expenses for continuing education.
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Director Resignation Policy
Our Bylaws provide that if an incumbent director is not elected by majority vote in an “uncontested election” (where the number of nominees does not exceed the number of directors to be elected), the director must offer to tender their resignation to our Board of Directors. The Nominating and Governance Committee would then make a recommendation to the Board whether to accept or reject the resignation, or whether other action should be taken. The Board will act on the Nominating and Governance Committee’s recommendation and publicly disclose its decision and the rationale behind it within 90 days from the date the election results are certified. The director who tenders their resignation will not participate in the Board’s decision with respect to their resignation. The election of directors that will be held at the 2023 Annual Meeting is an uncontested election.
Review and Approval or Ratification of Transactions with Related Persons
The Board and its Nominating and Governance Committee have adopted written policies and procedures relating to approval or ratification of “Related Person Transactions.” Under these policies and procedures, the Nominating and Governance Committee (or its chair, under some circumstances) reviews the relevant facts of all proposed Related Person Transactions and either approves or disapproves of the Related Person Transaction, by taking into account, among other factors it deems appropriate:
● | the benefits to PPG of the transaction; |
● | the impact on a director’s independence, in the event the “Related Person” is a director or an immediate family member of a director or an entity in which a director is a partner, shareholder or executive officer; |
● | the availability of other sources for comparable products or services; |
● | the terms of the transaction; and |
● | the terms available to unrelated third parties or to employees generally. |
No director may participate in any consideration or approval of a Related Person Transaction with respect to which they or any of their immediate family members is the Related Person. Related Person Transactions are approved only if they are determined to be in, or not inconsistent with, the best interests of PPG and its shareholders.
If a Related Person Transaction that has not been previously approved or previously ratified is discovered, the Nominating and Governance Committee, or its chair, will promptly consider all of the relevant facts. In addition, the committee generally reviews all ongoing Related Person Transactions on an annual basis to determine whether to continue, modify or terminate the Related Person Transaction.
Under our policies and procedures, a “Related Person Transaction” is generally a transaction, arrangement or relationship (or any series of similar transactions, arrangements or relationships) in which PPG was, is or will be a participant and the amount involved exceeds $120,000, and in which any Related Person had, has or will have a direct or indirect material interest. A “Related Person” is generally any person who is, or at any time since the beginning of PPG’s last fiscal year was, (i) a director or executive officer of PPG or a nominee to become a director of PPG; (ii) any person who is known to be the beneficial owner of more than 5% of any class of PPG’s voting securities; or (iii) any immediate family member of any of the foregoing persons.
Certain Relationships and Related Transactions
As discussed above, the Nominating and Governance Committee is charged with reviewing potential conflicts of interest and all Related Person Transactions. PPG and its subsidiaries purchase products and services from and/or sell products and services to companies of which certain of the directors and/or executive officers of PPG are directors and/or executive officers. During 2022, PPG entered into the following transactions with Related Persons that are required to be reported under the rules of the Securities and Exchange Commission:
Stephen F. Angel, a director of PPG, is Chairman of the Board of Linde plc. During 2022, PPG and its subsidiaries purchased approximately $3.5 million of industrial gases from Linde plc.
Guillermo Novo, a director of PPG, is Chairman and Chief Executive Officer of Ashland Inc. During 2022, PPG and its subsidiaries purchased approximately $36.1 million of products and services from Ashland Inc.
The Nominating and Governance Committee does not consider the amounts involved in such transactions material. Such purchases from and sales to each company involved less than 2% of the consolidated gross revenues for 2022 of each of the purchaser and the seller and all of such transactions were in the ordinary course of business.
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Board Committees
The Board currently has four standing committees: Audit Committee, Nominating and Governance Committee, Human Capital Management and Compensation Committee and Sustainability and Innovation Committee. The current composition of each Board committee is indicated below. The charter of each Board committee is available on the Corporate Governance section of our website at investor.ppg.com.
AUDIT COMMITTEE | | Primary Role of this Committee: The primary role of the Audit Committee is to oversee and review on behalf of the Board of Directors PPG’s processes to provide for the reliability and integrity of the Company’s financial reporting, including the Company’s disclosure practices, risk management processes and internal controls. | |
Meetings: 5 | | ||
Chair: Catherine R. Smith | |||
Other Members: | | ||
● Gary R. Heminger | | ||
●Kathleen A. Ligocki | |||
| ● Michael T. Nally | | |
| ● Guillermo Novo | | |
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Key Responsibilities: | | | |
●oversees our independent auditors and internal auditors | |||
●reviews audits, annual and quarterly financial statements and accounting and financial controls | |||
●appoints our independent registered public accounting firm | |||
●assists the Board in oversight of our compliance with legal and regulatory requirements | |||
●oversees the risk management process, including cybersecurity and data privacy | |||
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The Audit Committee is comprised entirely of directors who are independent under the standards adopted by the Board, the listing standards of the New York Stock Exchange and the applicable rules of the Securities and Exchange Commission. The committee’s charter, which may be accessed on the Corporate Governance section of our website at investor.ppg.com, describes the composition, purposes and responsibilities of the committee. Among other things, the charter provides that the committee will be comprised of independent, non-employee directors. The functions of the committee are primarily to review with our independent auditors and our internal auditors their respective reports and recommendations concerning audit findings and the scope of and plans for their future audit programs and to review audits, annual and quarterly financial statements and accounting and financial controls. The committee also appoints our independent registered public accounting firm, oversees our internal audit department, assists the Board in oversight of our compliance with legal and regulatory requirements related to financial reporting matters and oversees the risk management process. The Board has determined that each member of the committee is “financially literate” in accordance with the applicable rules of the New York Stock Exchange. In addition, the Board has determined that all of the members of the committee, including Ms. Smith, the chair of the committee, are “audit committee financial experts” in accordance with the applicable rules of the Securities and Exchange Commission. |
Audit Committee Report to Shareholders
The primary role of the Audit Committee is to oversee and review on behalf of the Board of Directors PPG’s processes to provide for the reliability and integrity of the Company’s financial reporting, including the Company’s disclosure practices, risk management processes and internal controls. The Audit Committee operates under a written charter adopted by the Board of Directors.
The Audit Committee is responsible for the appointment of the independent registered public accounting firm and PPG’s lead internal auditor, the Director of Corporate Audit Services. In addition, the Audit Committee led the appointment and retention of PricewaterhouseCoopers LLP as PPG’s independent registered public accounting firm for 2022. For the work performed on the 2022 audit, the Audit Committee discussed and evaluated PricewaterhouseCoopers’ performance, which included an evaluation by the Company’s management of PricewaterhouseCoopers’ performance. The Audit Committee is responsible for the compensation of the independent registered public accounting firm and has reviewed and approved in advance all services performed by PricewaterhouseCoopers.
The Audit Committee discussed with, and received regular status reports from, the Director of Corporate Audit Services and PricewaterhouseCoopers on the overall scope and plans for their audits, their plans for evaluating the effectiveness
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of PPG’s internal control over financial reporting and the coordination of efforts between them. The Audit Committee reviewed and discussed the key risk factors used in developing PPG’s internal audit and PricewaterhouseCoopers’ audit plans. The Audit Committee also reviewed with the Company’s management PPG’s risk management practices and an assessment of significant risks.
The Audit Committee met separately with the Vice President and Controller, the Director, Corporate Audit Services and PricewaterhouseCoopers, with and without management present, to discuss the results of their examinations, their audits of PPG’s financial statements and internal control over financial reporting and the overall quality of PPG’s financial reporting. The Audit Committee also met separately with the Company’s Senior Vice President and Chief Financial Officer and with the Company’s Senior Vice President and General Counsel. The Audit Committee annually reviews its performance and receives feedback on its performance from the Company’s management and PricewaterhouseCoopers, when appropriate.
The Company’s management is responsible for the preparation and accuracy of PPG’s financial statements. The Company is also responsible for establishing and maintaining adequate internal control over financial reporting. In 2022, PPG’s independent registered public accounting firm, PricewaterhouseCoopers, was responsible for auditing the consolidated financial statements and expressing an opinion as to their conformity with generally accepted accounting principles, as well as expressing an opinion on the effectiveness of PPG’s internal control over financial reporting.
In carrying out its responsibilities, the Audit Committee discussed and reviewed with the Company’s management the process to assemble the financial statements, including the Company’s internal controls and procedures designed to ensure compliance with accounting standards and applicable laws and regulations.
The Audit Committee reviewed and discussed the audited consolidated financial statements as of and for the year ended December 31, 2022 and management’s report on internal control over financial reporting with management and with PricewaterhouseCoopers. The Audit Committee also discussed with PricewaterhouseCoopers the matters required by the applicable requirements of the Public Company Accounting Oversight Board and the Securities and Exchange Commission.
The Audit Committee has received the written independence disclosures and letter from PricewaterhouseCoopers required by applicable requirements of the Public Company Accounting Oversight Board regarding the independent registered public accounting firm’s communications with the Audit Committee concerning independence and has discussed with PricewaterhouseCoopers its independence. In addition, the Audit Committee considered whether PricewaterhouseCoopers’ provision of non-audit services to PPG is compatible with maintaining its independence.
Based upon these reviews and discussions, the Audit Committee recommended to the Board that the audited financial statements be included in the Annual Report on Form 10-K for the year ended December 31, 2022 for filing with the Securities and Exchange Commission.
The Audit Committee:
Gary R. Heminger
Kathlen A. Ligocki
Michael T. Nally
Guillermo Novo
Catherine R. Smith (Chair)
Notwithstanding anything to the contrary set forth in any of our previous filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, that incorporate future filings, including this Proxy Statement, in whole or in part, the foregoing Audit Committee Report to Shareholders shall not be incorporated by reference into any such filings.
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NOMINATING AND GOVERNANCE COMMITTEE | | Primary Role of this Committee: The primary role of the Nominating and Governance Committee is to oversee PPG’s corporate governance framework and the composition of PPG’s Board of Directors and the Board’s committees. | |
Meetings: 6 | | ||
Chair: Hugh Grant | |||
Other Members: | | ||
● Stephen F. Angel | | ||
| ● Melanie L. Healey | | |
● Gary R. Heminger | |||
● Michael W. Lamach | |||
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Key Responsibilities: | | | |
●reviews the Company’s corporate governance framework, including all significant governance policies and procedures | |||
●identifies and recommends nominees to stand for election as directors at each annual meeting of shareholders and recommends nominees to fill any vacancies on the Board or executive management team | |||
●recommends actions to be taken regarding the structure, organization and functioning of the Board, including membership of the Board’s committees | |||
●develops corporate governance guidelines, including the process and criteria to be used in evaluating the performance of the Board | |||
●reviews the Company’s policies and practices regarding government affairs, public policy advocacy, and political spending and activities | |||
●reviews the Company’s environmental, social and governance programs and practices | |||
●reviews the performance of the Board | |||
●reviews the performance of the committees of the Board and the adequacy of the committees’ charters | |||
The Nominating and Governance Committee is comprised entirely of directors who are independent under the standards adopted by the Board and the listing standards of the New York Stock Exchange. The committee’s charter, which may be accessed on the Corporate Governance section of our website at investor.ppg.com, describes the composition, purposes and responsibilities of the committee. Among other things, the charter provides that the committee recommends to the Board actions to be taken regarding the structure, organization and functioning of the Board, and the persons to serve as members of the standing committees of, and other committees appointed by, the Board. The charter gives the committee the responsibility to develop and recommend corporate governance guidelines to the Board, to recommend to the Board the process and criteria to be used in evaluating the performance of the Board and to oversee the evaluation of the Board. |
Director Candidates
The Nominating and Governance Committee considers recommendations of potential director candidates from current directors, management and shareholders. The Nominating and Governance Committee also has authority to retain and terminate search firms to assist in identifying director candidates. From time to time, search firms have been paid a fee to identify candidates.
Director Candidate Attributes
In evaluating director candidates, the committee looks for candidates having the skills that the Board believes would add to the capabilities and knowledge of our Board, including the skills and attributes set forth below:
● | age shall be considered only in terms of experience of the candidate, seeking candidates who have broad experience in business, finance, leadership, technology, strategy, sustainability, government affairs or law; |
● | candidates for director should have knowledge of the global operations of industrial and retail businesses such as those of PPG; |
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● | candidates for director should be cognizant of PPG’s societal responsibilities in conducting its operations; |
● | each candidate should have sufficient time available to be a meaningful participant in Board affairs. Candidates should not be considered if there is either a legal impediment to service or a foreseeable conflict of interest which might materially hamper full and objective participation in all matters considered by the Board of Directors; |
● | absent unforeseen health problems, each candidate should be able to serve as director for a sufficient period of time to make a meaningful contribution to the Board’s guidance of PPG’s affairs; and |
● | the Board will be comprised of a majority of independent directors. |
In applying these criteria, the committee seeks to establish a Board that, when taken as a whole, should:
● | be representative of the broad scope of shareholder interests, without orientation to any particular constituencies; |
● | challenge management, in a constructive way, to reach PPG’s goals and objectives; |
● | be sensitive to the diversity of PPG’s shareholders, associates, operations and other stakeholder interests; |
● | be comprised principally of active or retired senior executives of publicly held corporations or financial institutions, with consideration given to those individuals who are scientifically-oriented, educators and government officials having corporate experience, whenever the needs of PPG indicate such membership would be appropriate; |
● | include directors of varying ages, but whose overriding credentials reflect maturity, experience, insight and prominence in the community; and |
● | be small enough to promote open and meaningful boardroom discussion, but large enough to staff the necessary Board committees. |
Shareholder Recommendations or Nominations for Director and Proxy Access
The Nominating and Governance Committee considers recommendations of potential candidates from shareholders. Candidates recommended by shareholders are evaluated against the same criteria used to evaluate all candidates. Shareholders wishing to recommend or nominate a nominee for director should send their recommendation or nomination to the corporate secretary at PPG Industries, Inc., One PPG Place, Pittsburgh, Pennsylvania 15272.
PPG’s Bylaws provide for “proxy access.” Proxy access is a process that allows an eligible shareholder or a group of eligible shareholders to nominate director candidates to appear in PPG’s proxy materials. Proxy access is available to shareholders or groups consisting of no more than 20 shareholders that have held at least 3% of PPG’s outstanding stock for at least three years and who have met the other requirements set forth in Article I of PPG’s Bylaws. A shareholder recommendation or nomination of a director candidate must be submitted by the deadlines and with the information and written representations that are described in Article I of our Bylaws. Director nominations submitted pursuant to PPG’s proxy access Bylaw for consideration at the 2024 Annual Meeting of shareholders must be received by PPG no earlier than October 11, 2023 and no later than November 10, 2023. A copy of PPG’s Bylaws may be accessed on the Corporate Governance section of our website at investor.ppg.com.
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HUMAN CAPITAL MANAGEMENT AND COMPENSATION COMMITTEE | | Primary Role of this Committee: The primary role of the Human Capital Management and Compensation Committee is to oversee the compensation of PPG’s executive officers and directors, to set objectives for incentive-based compensation for our executive officers and to oversee the Company’s human capital management strategies. | |
Meetings: 5 | | ||
Chair: Stephen F. Angel | |||
Other Members: | | ||
● Hugh Grant | | ||
● Michael W. Lamach | |||
●Guillermo Novo | |||
| ● Martin H. Richenhagen | | |
Key Responsibilities: | | | |
●approves and administers our compensation plans applicable to our directors and executive officers and establishes their compensation and benefits | |||
●reviews and approves the goals and objectives relative to the Chief Executive Officer’s compensation and evaluates the Chief Executive Officer’s performance in light of these goals ●reviews and approves the Company’s executive incentive compensation plans and equity compensation plans ●reviews and recommends to the Board the compensation of the Board of Directors ●reviews tally sheets that set forth the Company’s total compensation obligations to our senior executives under various scenarios, including retirement, voluntary and involuntary termination and termination in connection with a change in control of PPG ●reviews the Company’s human capital management strategies in the areas of culture and purpose, employee engagement, development and pay equity | |||
The Human Capital Management and Compensation Committee is comprised entirely of directors who are independent under the standards adopted by the Board and the listing standards of the New York Stock Exchange. The committee’s charter, which may be accessed on the Corporate Governance section of our website at investor.ppg.com, describes the composition, purposes and responsibilities of the committee. Among other things, the charter provides that the committee will be comprised of independent, non-employee directors. The committee approves, adopts, administers, interprets, amends, suspends and terminates our compensation plans applicable to, and establishes the compensation and benefits of, all of our directors and executive officers. Recommendations regarding compensation of other officers are made by our Chief Executive Officer. The conclusions reached and recommendations based on these reviews, including with respect to salary adjustments and annual award amounts, are presented to the committee. The committee can exercise its discretion in modifying any recommended adjustments or awards to executives. Committee meetings are regularly attended by our Executive Chairman, Chief Executive Officer and Vice President and Chief Human Resources Officer, as well as a representative of the outside compensation consulting firm retained by the committee, FW Cook. At each meeting, the committee meets in executive session. The committee’s chair reports the committee’s recommendations on executive compensation to the Board. The human resources department supports the committee in its duties, along with the Company’s Compensation and Employee Benefits Committee, a committee comprised of members of senior management that may be delegated authority to fulfill certain administrative duties regarding our compensation programs. The committee has authority under its charter to retain, approve fees for and terminate advisors, consultants and agents as it deems necessary to assist in the fulfillment of its responsibilities. |
Independent Compensation Consultant to the Human Capital Management and Compensation Committee
The committee engaged FW Cook to advise the committee on all matters related to executive officer and director compensation. Specifically, FW Cook provides relevant market data, current updates regarding trends in executive and director compensation, and advice on program design, specific compensation recommendations for the Executive Chairman and the Chief Executive Officer and on the recommendations being made by management for executives other than the Executive Chairman and the Chief Executive Officer. The committee meets independently with its consultant at each regularly scheduled meeting. All of the services that the compensation consultant performs for
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PPG are performed at the request of the committee, are related to executive and director compensation and are in support of decision making by the committee.
In 2022, the committee considered the independence of FW Cook in light of Securities and Exchange Commission rules and New York Stock Exchange listing standards. The committee requested and received a letter from FW Cook addressing FW Cook’s and the senior advisor involved in the engagement’s independence, including the following factors: (1) other services provided to us by FW Cook; (2) fees paid by us as a percentage of FW Cook’s total revenue; (3) policies or procedures maintained by FW Cook that are designed to prevent a conflict of interest; (4) any business or personal relationships between the senior advisor and a member of the committee; (5) any Company stock owned by FW Cook or the senior advisor; and (6) any business or personal relationships between our executive officers and FW Cook or the senior advisor. The committee discussed these considerations and concluded that the work performed by FW Cook and FW Cook’s senior advisor involved in the engagement did not raise any conflict of interest.
Human Capital Management and Compensation Committee Report to Shareholders
We have reviewed and discussed the Compensation Discussion and Analysis section of this Proxy Statement with management. Based on our review and discussion with management, we have recommended to the Board of Directors that the Compensation Discussion and Analysis be included in this Proxy Statement and incorporated in the Annual Report on Form 10-K for the year ended December 31, 2022.
Human Capital Management and Compensation Committee:
Stephen F. Angel (Chair)
Hugh Grant
Michael W. Lamach
Guillermo Novo
Martin H. Richenhagen
Notwithstanding anything to the contrary set forth in any of our previous filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, that incorporate future filings, including this Proxy Statement, in whole or in part, the foregoing Human Capital Management and Compensation Committee Report to Shareholders shall not be incorporated by reference into any such filings.
Compensation Program Design Mitigates Risk
In 2022, the Company’s management undertook a review of all of PPG’s compensation programs to identify any inherent material risks to PPG created by these programs. Based on the results of this review, we concluded that the design of our compensation programs does not encourage our employees to take unnecessary or excessive risks that could harm the long-term value of PPG. For more information about this review and the features of our compensation program that mitigate risk, see “Compensation Discussion and Analysis—Compensation Program Design Mitigates Risk.”
Compensation Committee Interlocks and Insider Participation
No member of the Human Capital Management and Compensation Committee was at any time during 2022 an officer or employee of PPG or any of our subsidiaries nor is any such person a former officer of PPG or any of our subsidiaries. In addition, no “Human Capital Management and Compensation Committee interlocks” existed during 2022. For information concerning Related Person Transactions involving members of the Human Capital Management and Compensation Committee, see “Corporate Governance—Certain Relationships and Related Transactions.”
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SUSTAINABILITY AND INNOVATION COMMITTEE | | Primary Role of this Committee: The primary role of the Sustainability and Innovation Committee is to review and provide oversight of programs, initiatives and activities of PPG in the areas of environment, health, safety, technology and sustainability. | |
Meetings: 3 | | ||
Chair: Melanie L. Healey | |||
Other Members: | | ||
● Kathleen A. Ligocki | | ||
●Michael T. Nally | |||
| ● Martin H. Richenhagen | | |
| ● Catherine R. Smith | | |
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Key Responsibilities: | | | |
●reviews with management the Company’s approach to innovation, science and technology, including the Company’s processes, capabilities and plans in relation to its corporate strategies and goals in these areas | |||
●reviews with management the current status, plans, risks and emerging trends related to the Company’s environment, health, safety, product stewardship and remediation programsthat can have a material impact on the Company | |||
●oversees the Company’s sustainability principles, practices and programs and monitors the Company’s performance against its sustainability goals, including the risks and opportunities to the Company of climate change | |||
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The Sustainability and Innovation Committee is comprised entirely of directors who are independent under the standards adopted by the Board. The committee’s charter, which may be accessed on the Corporate Governance section of our website at
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Codes of Ethics
Our Global Code of Ethics is applicable to all directors, officers and employees worldwide. The Global Code of Ethics, which was revised, updated and reformatted to make it more user friendly in 2022, embodies our principles and practices relating to the ethical conduct of our business and our long-standing commitment to honesty, fair dealing and compliance with all laws affecting our business. We also have a Code of Ethics for Senior Financial Officers that is applicable to our principal executive officer, principal financial officer, principal accounting officer, controller and persons performing similar functions. The Global Code of Ethics and Code of Ethics for Senior Financial Officers are available on the Corporate Governance section of our website at investor.ppg.com. In addition, we intend to post on our website all disclosures that are required by law, the Securities and Exchange Commission’s Form 8-K rules or the New York Stock Exchange listing standards concerning any amendments to, or waivers from, any provision of our codes.
The Board has established a means for employees, customers, suppliers, shareholders or other interested parties to submit confidential and anonymous reports of suspected or actual violations of our Global Code of Ethics. Any employee, shareholder or other interested party can call the PPG Ethics HELPLINE toll-free to submit a report. In North America, this number is (800) 461-9330. This number is operational 24 hours a day, seven days a week. PPG Ethics HELPLINE numbers for other regions may be found on the Ethics page of our website at www.ppg.com/ethics.
Communications with the Board
Shareholders and other interested parties may send communications to the Board, the independent directors (individually or as a group) or the Lead Director in writing by sending them in care of our corporate secretary at PPG Industries, Inc., One PPG Place, Pittsburgh, Pennsylvania 15272. All communications received will be opened by the corporate secretary for the sole purpose of determining whether the contents represent a message to directors. Communications deemed by the corporate secretary to be frivolous or otherwise inappropriate for the Board’s consideration will not be forwarded. The corporate secretary will maintain a log of all such communications. Communications of an urgent nature are promptly reported to the Board. Communications to directors may also be forwarded within PPG for review by a subject matter expert.
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COMPENSATION OF DIRECTORS
Overview
The compensation program for our directors who are not also officers of PPG, to whom we refer as non-employee directors, is reviewed annually by the Human Capital Management and Compensation Committee to ensure that the program remains competitive. As a part of the Human Capital Management and Compensation Committee’s review, the types and levels of compensation offered to our non-employee directors are compared with those provided by a select group of comparable companies. Target total annual compensation for our directors is set at or near the market median using a comparator group of companies. The companies comprising this comparator group are used for review of the executive officer compensation program as well. The comparator group used in 2021 to set 2022 compensation was:
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3M Company | Eaton Corporation plc | International Paper Company | Textron Inc. |
Air Products and Chemicals, Inc. | Ecolab Inc. | Johnson Controls International Plc | The Goodyear Tire & Rubber Company |
Celanese Corporation | Emerson Electric Co. | Linde Plc | The Sherwin-Williams Company |
Dow, Inc. | Honeywell International Inc. | Parker-Hannifin Corporation | Trane Technologies Plc |
DuPont de Nemours, Inc. | Howmet Aerospace Inc. | Rockwell Automation, Inc. | |
Eastman Chemical Company | Illinois Tool Works Inc. | Stanley Black & Decker, Inc. | |
Taking into consideration the size of PPG relative to this comparator group and advice from FW Cook, the Human Capital Management and Compensation Committee reports its recommendations to the Board for approval. The Human Capital Management and Compensation Committee does not determine director compensation, but only makes recommendations to the Board. Changes to the non-employee directors’ compensation program generally become effective as of the year following adoption.
Directors Compensation (2022)
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| | FEES EARNED OR | | | | | | | | | | ||||
| | PAID IN CASH ($)(1) | | | | | | | | | | ||||
| | | | | COMMITTEE | | | | | | | | | | |
| | ANNUAL | | CHAIRPERSON | | STOCK | | ALL OTHER | | | | ||||
NAME | | RETAINER | | FEES | | AWARDS ($)(2) | | COMPENSATION ($)(3) | | TOTAL ($) | |||||
S. F. Angel |
| $ | 135,000 |
| $ | 20,000 |
| $ | 165,047 |
| $ | 10,000 |
| $ | 330,047 |
S. A. Davis(4) | | $ | 67,500 | | $ | — | | $ | 165,047 | | $ | — | | $ | 232,547 |
J. V. Faraci(5) | | $ | — | | $ | — | | $ | — | | $ | 10,000 | | $ | 10,000 |
H. Grant | | $ | 135,000 | | $ | 55,000 | | $ | 165,047 | | $ | 20,000 | | $ | 375,047 |
M. L. Healey | | $ | 135,000 | | $ | 15,000 | | $ | 165,047 | | $ | — | | $ | 315,047 |
G. R. Heminger | | $ | 135,000 | | $ | — | | $ | 165,047 | | $ | 10,000 | | $ | 310,047 |
M. W. Lamach | | $ | 135,000 | | $ | — | | $ | 165,047 | | $ | — | | $ | 300,047 |
K. A. Ligocki | | $ | 135,000 | | $ | — | | $ | 165,047 | | $ | 5,000 | | $ | 305,047 |
M. T. Nally | | $ | 135,000 | | $ | — | | $ | 165,047 | | $ | — | | $ | 300,047 |
G. Novo | | $ | 135,000 | | $ | — | | $ | 165,047 | | $ | — | | $ | 300,047 |
M. H. Richenhagen | | $ | 135,000 | | $ | — | | $ | 165,047 | | $ | — | | $ | 300,047 |
C. R. Smith | | $ | 135,000 | | $ | 25,000 | | $ | 165,047 | | $ | — | | $ | 325,047 |
(1) | Fees include an annual cash retainer of $135,000, plus an additional cash retainer for each committee chair and for the Lead Director. For 2022, the annual retainer for service as a committee chair or as the Lead Director was as follows: $35,000 for the Lead Director; $25,000 for the chair of the Audit Committee; $20,000 for the chair of each of the Nominating and Governance Committee and the Human Capital Management and Compensation Committee; and $15,000 for the chair of the Sustainability and Innovation Committee. |
(2) | In April 2022, each director, other than Mr. Faraci, received 1,232 time-based restricted stock units, or TBRSUs. The TBRSUs will vest on April 19, 2023, and the grant date fair value of each RSU grant was $133.97. Dollar values represent |
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36 2023 Proxy Statement | |
the grant date fair value calculated in |
(3) | Amounts in this column reflect donations made by the PPG Industries |
(4) | Mr. Davis died on July 10, 2022. This director received $67,500 for his prorated cash retainer. No cash retainer was paid to him or his estate after his death. Mr. Davis’s estate will receive his full equity retainer upon vesting on April 19, 2023. |
(5) | Mr. Faraci retired from the PPG Board of Directors effective April 21, 2022. As such, this director received no annual retainer or committee chair retainer for the
Annual Retainer For Additional Retainers for Committee Chairs and the Lead Director In addition to the annual retainer for each
Insurance Coverage We pay the premiums to provide each of our
Deferred Compensation A
after the director leaves the Board. All amounts held in a director’s account under the Deferred Compensation Plan are credited as hypothetical shares of our stock, or what we refer to as common stock equivalents, the number of which is determined by dividing the dollar amount of the deferral by the closing stock price of PPG common stock on the New York Stock Exchange on the date of the deferral. Common stock equivalents earn dividend equivalents (that are converted into additional common stock equivalents) when dividends are declared on PPG common stock, but do not
carry voting rights or other rights afforded to a holder of PPG common stock. Each
Stock Ownership We established stock ownership guidelines for all
COMPENSATION DISCUSSION AND ANALYSIS ROADMAP
Executive Compensation Best Practices The Human Capital Management and Compensation Committee’s decision making reflects the following core governance principles and practices that we employ to promote our overall compensation objectives and to align executive compensation with the interests of our shareholders:
COMPENSATION DISCUSSION AND ANALYSIS
The Company’s
The following charts contain adjusted earnings per diluted share from continuing operations, net sales and adjusted net income from continuing operations as used for determining the compensation
*2019 Adjusted Earnings Per Diluted Share includes $0.16 for the year-over-year impact of foreign currency translation. **Beginning in 2021, the Company reports adjusted net income and adjusted earnings per diluted share excluding amortization expense relating to intangible assets from completed acquisitions. Adjusted earnings per diluted share for 2020 has been recast to exclude acquisition-related amortization expense. ***Beginning with the Adjusted earnings per diluted share from continuing operations and adjusted net income from continuing operations are not recognized financial measures determined in accordance with U.S. generally accepted accounting principles (U.S. GAAP) and should not be considered a substitute for earnings per diluted share or net income or other financial measures as computed in accordance with U.S. GAAP. PPG’s management considers this information useful in providing insight into the Company’s ongoing performance
In keeping with our pay-for-performance philosophy, a substantial portion of our executives’ annual and
Compensation Philosophy and Objectives PPG’s philosophy in establishing compensation policies for our executive officers is to align compensation with our strategic objectives, while concurrently providing competitive compensation that enables us to attract and retain
Annual Compensation Programs Our executive officers receive two forms of annual compensation—base salary and annual incentive awards—which together constitute an executive’s total annual compensation. Our executive officers also receive long-term incentives which together with total annual compensation constitute an executive’s total direct compensation. Please note that “total annual To determine market value, the
For purposes of establishing the
The comparator group used in 2021 to set 2022 compensation was:
Our comparator group is intended to be representative of the market in which we compete most directly for executive talent. The selection of companies comprising our comparator group is based on similarity in revenue size, lines of business, participation in global markets and market capitalization. The peer group is constructed to target PPG near the median of the composite ranking of the financial and operating metrics of the companies in the comparator group. The We target the median levels of compensation to derive our market value by adjusting this compensation data to reflect differences in company revenues using regression analysis. The In addition, the
The
The charts below illustrate the allocation of the principal compensation components for our named executive officers for
Compensation Program Design Mitigates Risk Annually, PPG management undertakes a review of
of our compensation programs and practices that mitigate risk include, among other things: (i) incentive plans that are appropriately weighted between short-term and long-term performance and cash and equity; (ii) long-term incentives that consist of a mix of stock options, performance-based restricted stock units and total shareholder return contingent shares, which provides for a balanced mix of performance measures; (iii) ranges of performance and multiple performance targets are utilized to determine incentive compensation payouts, rather than a single performance target that provides an “all or nothing” basis for compensation; (iv) maximum payouts are in place in our incentive compensation programs to limit excessive payments; (v) determination of incentive compensation payouts is subject to managerial approval and/or Human Capital Management and Compensation Committee discretion; and (vi) our executive officers are subject to a recoupment policy in the event of a financial restatement affecting their incentive compensation payout. In addition, the following design elements of our compensation program mitigate potential risks.
Financial Restatement It is our policy that we will, to the extent permitted by governing law, seek recoupment of incentive compensation paid to any executive officer where:
In each such instance, we will, to the extent practicable, seek to recover the amount by which the individual executive officer’s incentive compensation for the relevant period exceeded
PPG Stock Ownership Requirements The Human Capital Management and Compensation Committee also believes that it is in the best interests of shareholders for our officers to own a significant amount of PPG common stock, thereby aligning their interests with the interests of shareholders. Accordingly, in 2003 the Human Capital Management Compensation Committee implemented stock ownership requirements applicable to all of our officers based on a
Ownership for
been subject to the policy for more than five years at their current requirement level and have not met the ownership requirement, 100% of the vested shares delivered from the Prohibition on Hedging and PPG officers and
Equity awards may be granted by either the Human Capital Management and Compensation Committee or its delegate. The Human Capital Management and Compensation Committee only delegates authority to grant equity awards to employees who are not executive officers, and only in aggregate amounts not exceeding amounts approved by the Human Capital Management and Compensation Committee. The Board generally does not grant equity awards, although the Human Capital Management and Compensation Committee regularly reports its activity, including approval of grants, to the Board. Timing of Grants. Equity awards are granted in February
Change In Control Agreements We have agreements in place with each of the executive officers named in the Summary Compensation Table
Section 162(m) of the Internal Revenue Code limits the deductibility of compensation in excess of $1 million paid to any one of our named executive
compensation programs
Principal Components of Executive Compensation The principal components of our executive compensation
Mix of Compensation Components Executive compensation is based on our pay-for-performance philosophy, which emphasizes executive performance measures that correlate closely with the achievement of both shorter-term performance objectives and longer-term shareholder value creation. To this end, a substantial portion of our executives’ annual and long-term compensation is performance-based, with the payment being contingent on the achievement of performance goals. The portion of compensation that is performance-based increases with the executive’s level of responsibility. We use performance- based compensation for more senior positions because these roles have greater leadership responsibility and influence on the performance of the Annual Compensation Our annual compensation policies reflect our pay-for-performance philosophy. We set target total annual compensation for our executive officers to Base Salary. Based on the Human Capital Management and Compensation Committee’s review of the
Ms. Liebert resigned from the Company, effective September 16, 2022. On October 19, 2022, Mr. McGarry was appointed Executive Chairman and Mr. Knavish was appointed President and Chief Executive Officer, each effective January 1, 2023.
Annual Incentive Awards. In February 2022, the Human Capital Management and Compensation Committee established annual incentive
For many years, PPG has been committed to sustainability. Recognizing the importance of sustainability and its ability to drive innovation in Beginning in 2022, our executive officers have ESG goals included in the individual performance component of their annual incentive award. Each executive officer has a specific DE&I goal and a sustainability or governance goal that is aligned with the Company’s strategies and targets. The potential payout of the Company performance component of the annual incentive is based on a pre-determined schedule recommended by management and approved by the In assessing Company performance against objectives, the Human Capital Management and Compensation Committee considers reported results against the approved target objectives, taking into consideration whether significant uncontrollable and unforeseen events or economic obstacles or more favorable circumstances impacted the Company’s results. The assessment of Company performance determines the percentage of the target award that will be awarded to each executive for the Company performance component of the annual incentive award. For 2022, as described below, the Human Capital Management and Compensation Committee exercised discretion and approved certain non-operating adjustments to the
In February 2022, the Human Capital Management and
diluted share from continuing operations of $8.35, adjusted cash flow from operating activities of $2,679 million, price increase of 7.65% and sales volume growth of 3.75% were achieved. For 2022, the Human Capital Management and Compensation Committee approved the actual Company performance component for incentive awards based on adjusted earnings per diluted share from continuing operations of $6.22, adjusted cash flow from operating activities of $1,059 million, price increase of 11.20% and sales volume growth of - 3.60%. The earnings per diluted share performance component included adjustments of $0.90 for impairment and other related charges associated with the Company’s wind down of its Russian operations, $0.53 for acquisition-related amortization expense, $0.24 for business restructuring-related costs, net, and $0.05 for transaction-related costs. Beginning with the calculation of the 2022 annual incentive award, one half of the earnings impact (positive or negative) of foreign currency translation versus plan will be applied as an Adjusted earnings per diluted share from continuing operations of $6.22, adjusted cash flow from operating activities of $1,059 million, price increase of 11.20% and sales volume growth of -3.60% resulted in a payout of 45% of target for the Approved 2022 Performance Components
The personal performance component of the annual incentive is based on measures of individual performance relevant to the particular individual’s job responsibilities. The personal performance assessments of our Executive Chairman and President and Chief Executive Officer are determined by the Human Capital Management and Compensation
Committee with input from the other non-management members of the Board. The personal performance of each other executive officer is determined by our Executive Chairman and President and Chief Executive Officer. The following factors were considered in assessing the personal performance of the executive officers named in the Summary Compensation Table for 2022 against individual objectives: Under Mr. McGarry’s leadership, the Company delivered record net sales despite the global COVID-19 pandemic, ongoing raw material, labor and transportation availability challenges, and geopolitical events, all of which significantly impacted the Company’s 2022 performance and businesses. Organic sales were higher by 8%, including higher selling prices of about 11%. Record total net sales for 2022 were approximately $17.7 billion, up 5% compared to 2021. The Company’s 2022 full-year reported net income from continuing operations was $1.0 billion, or $4.33 per diluted share versus $1.4 billion, or $5.93 per diluted share, in 2021. Full year 2022 adjusted earnings per diluted share from continuing operations decreased 11% year-over-year to $6.05 compared with $6.77 in 2021. Adjusted net income from continuing operations for 2022 was $1.4 billion, versus $1.6 billion in 2021. Acquisition-related sales contributed 3% to net sales growth as the Company benefited from four strategic acquisitions that were completed in 2021. Foreign currency translation was unfavorable for the year and impacted net sales by about 5%. During 2022, severe cost inflation, supply disruptions, geopolitical issues in Europe and continuing impacts from the pandemic significantly impacted net sales and earnings. There was partial recovery in the end-use markets that were impacted by mobility restrictions in 2020 and 2021, such as automotive original equipment manufacturer, automotive refinish coatings and aerospace coatings businesses, but all three remained below 2019 global demand levels. Demand was mixed by geographic region. Raw material cost inflation trended higher for most of the year, finishing the fourth quarter about 35% above fourth quarter 2019 levels. New 2030 corporate sustainability operational and sales targets were developed, reviewed and approved. Science-Based Targets (“SBT”) were submitted to the SBT Initiative in September 2022, with validation expected in 2023. Once the targets are validated, new 2030 ESG targets will be published. In 2022, PPG delivered mixed performance improvements for its sustainability goals versus 2021, but the waste and sustainable product metrics remain aligned to 2025 targets. PPG achieved its overall goal of increasing year-over-year representation of our targeted demographics. The Company also promoted an inclusive culture as demonstrated through the increase in enterprise-wide employee resource network and diversity, equity and inclusion capability building and training participation. Finally, employee engagement increased for the seventh year in a row. Considering overall 2022 business performance, these efforts generated results lower than our overall expectations. Mr. Knavish began 2022 leading PPG’s global architectural coatings business. He also oversaw the automotive refinish coatings business, the traffic solutions business and the Latin America region. With his appointment to Chief Operating Officer in March 2022, Mr. Knavish assumed leadership responsibility for all of the Company’s remaining businesses, operating regions and for the information technology, environment, health and safety (“EH&S”), and procurement functions. In the U.S. and Canada, demand in the residential and commercial construction markets was strong at the beginning of the year but softened as the year progressed. Architectural coatings – Europe, Middle East and Africa organic sales were flat compared to prior year as selling price increases were offset by lower sales volumes. Architectural coatings – Americas and Asia Pacific organic sales increased a mid-single-digit percentage during the year primarily due to selling price increases that more than offset lower sales volumes. In aggregate, organic sales for the Company’s other business units increased primarily due to higher selling prices which were partially offset by lower sales volumes and unfavorable foreign currency translation. PPG’s spill and release and injury and illness rates did not meet target for 2022. Mr. Knavish served as the executive sponsor of the Black Employee Network. He effectively performed as a member of the Executive Committee, positively influencing the results of the Company. Considering overall 2022 business performance, these efforts generated results lower than our overall expectations. Mr. Morales led the finance organization. In 2022, the Company generated approximately $1.0 billion of cash from operations, which is lower than 2021 primarily due to a larger increase in working capital in 2022 compared to the prior year, which reflects the impact of higher raw material costs on inventories and higher selling prices on trade receivables. Operating working capital as a percentage of sales increased over 2021. The Company made solid progress in the second half of 2022 lowering inventories on a sequential basis. As the year progressed, year-over-year segment margins improved and operating working capital decreased. He led the Company’s efforts to contain costs, delivering about $110 million from restructuring actions and acquisition-related synergies, and to return capital to our shareholders through $190 million of share repurchases and approximately $570 million of dividends. Mr. Morales was the executive sponsor of our Abilities First Employee Resource Network. Mr. Morales performed effectively as a member of the Executive Committee, positively influencing the results of the Company. Considering overall 2022 business performance, these efforts generated results lower than our overall expectations. Ms. Foulkes led the legal organization. She has expertly managed litigation, compliance and environmental concerns globally for the Company. In addition, she to effectively managed the complexities associated with the war in Ukraine. She was the executive sponsor of our Lesbian, Gay, Bi-sexual, Transgender, Queer (LGBTQ+) Employee Resource Network. Engagement scores for the Law Department were among the highest in the Company. Ms. Foulkes performed
effectively as a member of the Executive Committee, positively influencing the results of the Company. While Ms. Foulkes provided strong leadership to the legal function to manage the complexities associated with the war in Ukraine. However, overall 2022 business results were lower than our expectations.
Business unit short-term performance objectives and their assessment are specific to each particular business and are based on earnings before taxes and interest, working capital reduction, price increase and sales volume growth. The For 2022, we assessed the performance of 12 defined businesses against the criteria discussed above. Actual payouts of the business performance component ranged from 20% to 130% of target. The business performance component payout for our executive officer named in the Summary Compensation Table who has primarily business unit responsibility, Mr. Vadlamannati, is Mr. Vadlamannati’s business performance component was a result of The level of achievement of corporate and personal performance objectives for 2022 for Messrs. McGarry, Knavish and Morales and Ms. Foulkes corresponded to Due to Ms. Liebert’s departure from the Annual incentive awards are payable in cash, except that
Long-Term Incentive Compensation Our Human Capital Management and Compensation Committee believes that long-term incentive compensation is an important component of our program because it has the effect of retaining executives, aligning executives’ financial interests with the interests of shareholders and incentivizing achievement of PPG’s long-term strategic goals. Payment of long-term incentive awards is based solely on Company performance. Grants are targeted at levels that approximate market value for comparable positions, utilizing the same compensation data used for setting total annual compensation. Each February, the Human Capital Management and Compensation Committee reviews and approves equity-based compensation for that year to be granted to executive officers. Three types of long-term incentive awards are granted annually to executive officers:
The number of stock options, TSR shares and PBRSUs granted to executive officers is intended to represent an estimated potential value that, when combined with total annual compensation, as discussed above, will approximate the market value of total annual and long-term compensation paid to executives in our comparator group and in a cross-section of general industrial companies represented in nationally-recognized executive compensation surveys. These types of long-term incentive awards were selected to provide a program that focuses on different aspects of long-term performance: stock price appreciation, total return to shareholders and earnings per share growth and cash flow return on capital. The estimated potential value of the awards granted to each executive officer is delivered equally through each instrument, so that approximately one-third of the value of the total award is in stock options, one-third is in performance-based RSUs, and one-third is in TSR shares. The Human Capital Management and Compensation Committee selected equal distribution to emphasize its view that each of the three equity-based vehicles serves a particular purpose and is equally important in supporting our long-term compensation strategy. Stock Options. Stock options provide our executive officers with the opportunity to purchase and maintain an equity interest in PPG and to share in the appreciation of the value of our stock. All stock options granted to executive officers in 2022 were granted from our shareholder-approved Omnibus Incentive Plan. Some features of our stock option program include:
We continue to use stock options as a long-term incentive because stock options focus the management team on delivering levels of company financial performance over a longer term that contribute to shareholder value. For additional information concerning the timing of grants of stock options, see “Our Policies with Respect to the Granting of Equity Awards.” In February 2022, the following stock options were awarded to each of the executive officers named in the Summary Compensation Table: Mr. McGarry, 91,266; Mr. Knavish, 25,554; Mr. Morales, TSR Shares. TSR shares represent a contingent share grant that is made at the
If minimum performance is not achieved, no payment is made with respect to the TSR share grant. If performance is above target, payment may exceed the original number of contingent TSR shares awarded. Target performance is set at the 50th percentile rank. The minimum and maximum number of shares that may be issued upon settlement of a TSR share grant ranges from 0% to 200% of the original number of contingent TSR shares awarded. Dividend equivalents are awarded at the end of the performance period, based on the actual number of shares earned and paid to an executive. TSR shares are intended to reward executives only when we provide a greater long-term return to shareholders relative to a percentage of the comparison set of companies, which is consistent with our pay-for-performance compensation philosophy. In February 2022, the following TSR shares were awarded to each of the executive officers named in the Summary Compensation Table: Mr. McGarry, 21,949; Mr. Knavish, 6,146; Mr. Morales, 6,585; Ms. Liebert, 4,060; Ms. Foulkes, 2,634; and Mr. Vadlamannati, 2,195. Such awards are consistent with our program to distribute long-term incentive awards equally among three different equity-based vehicles, as discussed above under “Long-Term Incentive Compensation.” The performance period for the TSR shares granted in 2020 ended on December 31, 2022. PPG’s total shareholder return was measured against that of the S&P 500 (as described above) over the three-year period ending December 31, 2022. PPG’s ranking on this performance measure was at the 28th percentile, resulting in payouts at 0.0% of target. If the payouts were distributed, the payout would have been 50% in shares of PPG common stock and 50% in cash with the cash payment calculated based on the average PPG stock closing price during the month of December 2022. Payouts to the executive officers named in the Summary Compensation Table for the 2020 TSR grants were: Mr. McGarry, 0 shares and $0; Mr. Knavish, 0 shares and $0; Mr. Morales, 0 shares and $0; Ms. Foulkes, 0 shares and $0; and Mr. Vadlamannati, 0 shares and $0. Such share payouts, which vested in December 2022, are reflected in the Option Exercises and Stock Vested table. Upon Ms. Liebert’s departure from the Company in September 2022, she forfeited her TSR shares. Performance-based RSUs. Performance-based RSUs, or PBRSUs, represent a contingent share grant that is made at the beginning of a three-calendar-year performance period and vests on the last day of the performance period. If we achieve certain pre-determined performance thresholds, payment is settled in shares of PPG common stock in the February immediately after the end of the three-year performance period. The performance criteria for each year in the three-year performance period were growth in adjusted earnings per diluted share and 11% cash flow return on capital, taking into account the same adjustment categories utilized by the Human Capital Management and Compensation Committee in determining adjusted earnings per diluted share for purposes of annual incentive awards (see “Annual Incentive Awards” above). The adjusted earnings per diluted share growth portion of the PBRSU awards will utilize a linear payment scale that will be calculated annually as shown below:
Achievement of 10% growth in adjusted earnings per diluted share is required to receive 100% of the original share grant. A payout scale is not applied to the cash flow return on capital goal, which requires achievement of 11% for this goal to be met each year. Performance against the adjusted earnings per diluted share goal and the cash flow return on capital goal are calculated annually, and the annual payout for each goal is weighted equally over the three-year period. If minimum performance is not achieved, no shares are issued with respect to the grant. If performance is above target, the number of shares issued may exceed the original number of contingent shares awarded. The minimum and maximum number of shares that may be issued upon settlement of a PBRSU award ranges from 0% to 200% of the original number of contingent shares awarded, depending on the goals attained during the three-year period. No dividend equivalents are awarded on performance-based RSUs. By including performance-based RSUs in the long-term incentive mix, executives are rewarded when financial performance objectives are achieved over an extended period of time. Summarized below are the material provisions of the performance-based RSUs:
In February 2022, the following PBRSUs were awarded to each of the executive officers named in the Summary Compensation Table: Mr. McGarry, 23,111; Mr. Knavish, 6,471; Mr. Morales, 6,933; Ms. Liebert, 4,276; Ms. Foulkes, 2,773; and Mr. Vadlamannati, 2,311. Such awards are consistent with our program to distribute long-term incentive awards equally among three different equity-based vehicles, as discussed above under “Long-Term Incentive Compensation.” The performance period for the PBRSUs granted in 2020 ended on December 31, 2022. For the 2020 grants, the payout was at 100% of target. Specifically, the results were as follows: PBRSU Performance Measures for 2020-2022 Performance Period
The Company made share payouts to the executive officers named in the Summary Compensation Table for the 2020 PBRSU grants as follows: Mr. McGarry, 24,351; Mr. Knavish, 4,132; Mr. Morales, 5,903; Ms. Foulkes, 2,361; and
Mr. Vadlamannati, 2,657. Such payouts, which vested in December 2022, are reflected in the Option Exercises and Stock Vested table. Upon Ms. Liebert’s departure from the Company in September 2022, she forfeited her PBRSUs. Perquisites and Other Benefits In addition to the annual and long-term compensation described above, executive officers named in the Summary Compensation Table receive certain perquisites and other benefits. Such perquisites may include financial counseling services and limited personal use of PPG’s corporate aircraft. At the direction of the Human Capital Management and Compensation Committee, in 2011 executive officer perquisites were reviewed and reduced. Effective January 1, 2012, personal club memberships were discontinued. Other benefits for our executive officers may include Company matching contributions under our Deferred Compensation Plan. These perquisites and other benefits are provided to increase the availability of the executives to focus on the business of the enterprise or because we believe they are important to our ability to attract and retain top-quality executive talent. The costs to PPG associated with providing these benefits for executive officers named in the Summary Compensation Table are reflected in the “All Other Compensation” column of the Summary Compensation Table and in the All Other Compensation Table. We also provide other benefits, such as medical, dental and life insurance and disability coverage, to each executive named in the Summary Compensation Table under our benefit plans, which are also provided to most eligible U.S.-based salaried employees. In addition, all of our U.S.-based executive officers are eligible to participate in the PPG Industries Foundation Matching Gift Program, which encourages charitable donations by all of our U.S. employees by matching their contributions to eligible institutions. Contributions of up to a total of $10,000 per year, in most cases, may be matched under the program. The match amount was increased to $20,000 for 2022 in support of PPG’s and the PPG Industries Foundation’s commitment to assist in ongoing relief and recovery efforts for affected communities during the Ukrainian refugees humanitarian crisis. Most charitable organizations are eligible for the Matching Gifts Program, with a few exceptions. The value of these benefits is not included in the Summary Compensation Table because such benefits are made available on a Company-wide basis to most U.S. salaried employees. We also provide vacation and other paid holidays to all employees, including the executive officers named in the Summary Compensation Table, which are comparable to those provided at other large companies. Deferred Compensation Opportunities and Retirement Plans Another aspect of our executive compensation program is our Deferred Compensation Plan. The plan is a voluntary, non-tax qualified, unfunded, deferred compensation plan available to all U.S.-based executive officers and other participants in our management incentive plans to enable them to save for retirement by deferring a portion of their current compensation. The plan also provides eligible employees with supplemental contributions equal to the contributions they would have received under our Employee Savings Plan, but for certain limitations under the Internal Revenue Code. Under the plan, compensation may be deferred until death, disability, retirement or termination or, in the case of the cash portion of certain incentive awards, other earlier specified dates the participants may select. Deferred amounts (other than the PPG common stock portion of deferred incentive awards, which must be invested in PPG stock) are credited to an investment account that earns a return based on the investment options chosen by the participant. The value of a participant’s investment account is based on the value of the investments selected. Benefits are paid out of our general assets. For certain longer-serving, U.S.-based, salaried employees, we maintain both a tax-qualified defined benefit pension plan and a non-qualified defined benefit pension plan. Substantially all employees in the U.S., including our executive officers, participate in the PPG Industries Employee Savings Plan. For additional information concerning our Deferred Compensation Plan, pension plans and the PPG Industries Employee Savings Plan, see “Pension Benefits” and “PPG Industries Employee Savings Plan and Deferred Compensation Plan” and the accompanying Pension Benefits Table and Non-Qualified Deferred Compensation Table.
The Board believes that PPG’s executive compensation program aligns the interests of our executives with those of our shareholders. Our executive compensation is based on our pay for performance philosophy, which emphasizes executive performance measures that correlate closely with the achievement of both shorter term performance
objectives and longer term shareholder value creation. At the 2022 Annual Meeting, we held a shareholder advisory vote on the compensation of our named executive officers, commonly referred to as a say-on-pay vote. Our shareholders overwhelmingly approved the compensation of our named executive officers, with approximately 95% of shareholder votes cast in favor of our 2022 say-on-pay resolution. Following its review of this vote, the Human Capital Management and Compensation Committee recommended to the full Board that we retain our general approach to executive compensation, with an emphasis on short-term and long-term incentive compensation that rewards our executive officers when they deliver value for our shareholders. Consistent with this philosophy:
COMPENSATION OF EXECUTIVE OFFICERS Summary Compensation Table
All Other Compensation Table (2022)
Grants of Plan Based Awards (2022)
U—PBRSUs. Estimated future payouts relate to the performance period of T—TSR shares. Estimated future payouts relate to the performance period of
Outstanding Equity Awards at Fiscal
U—PBRSUs. For additional information concerning the material terms of these PBRSU grants, see pages T—TSR shares. For additional information concerning the material terms of these TSR grants, see
Option Exercises and Stock Vested
Pension Benefits For certain Pension Benefits
The values reflected in the “Present Value of Accumulated Benefit” column of the Pension Benefits Table are equal to the actuarial present value of each officer’s accrued benefit under the applicable plan as of December 31, The benefit payable under Retirement Plan C is a function of the participant’s Retirement Plan C contains the following material terms:
The
The PPG Industries Employee Savings Plan (the “Savings Plan”) covers substantially all employees in the U.S. All of the executive officers named in the Summary Compensation Table participate in the Savings Plan. The Company makes matching contributions to the Savings Plan, at management’s discretion, based upon participants’ savings, subject to certain limitations. For most participants,
compensation. Employees can contribute from 1% to 50% of eligible plan compensation to the Savings Plan, subject to certain Plan or legal limits that may apply. Employees are always 100% vested in any money employees contribute or the Company contributes to the Savings Plan as a matching contribution.
In the U.S., we maintain the Deferred Compensation Plan to allow participants, including each of the
The table below shows the Deferred Compensation Plan’s current investment options and their respective annual rate of return for the year ended December 31,
The amount owed to executive officers under the Deferred Compensation Plan is an unfunded and unsecured general obligation of PPG. An executive officer receives a distribution of the balance in
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE IN CONTROL The tables below reflect the amount of compensation to each of our currently serving executive officers named in the Summary Compensation Table in the event of termination of such executive’s employment under certain circumstances. The amounts shown assume that such termination was effective as of December 31, For purposes of calculating the estimated potential payments to our officers under the Potential Payments and Benefits Upon Termination The first column of each table below sets forth the payments to which the officer would be entitled, other than accrued but unpaid base salary and any benefits payable or provided under
Change in Control
Potential Payments and Benefits Upon Termination Following, or in Connection with, a Change in Control of PPG We have entered into change in control agreements with our executive officers named in the Summary Compensation Table Termination For Cause or Other Than For Good Reason. Under the change in control agreements, in the event of an officer’s termination of employment by PPG for cause or by the officer other than for good reason during the Termination Without Cause or For Good Reason. If PPG terminates the officer’s employment (other than for cause, death or disability) or the officer terminates
following a change in control, and upon certain terminations prior to a change in control or in connection with or in anticipation of a change in control, the officer is generally entitled to receive the following payments and benefits:
The table below sets forth the amounts each executive officer named in the Summary Compensation Table would be entitled to receive, other than accrued but unpaid base salary and any benefits payable or provided under For purposes of calculating the estimated potential payment to such executive officers with respect to the Pension Differential under the change in control agreements, as reflected in the table below, we have used the same actuarial factors and assumptions used for financial statement reporting purposes and set forth under Note Termination During the Definitions. For purposes of the agreements, the terms set forth below generally have the meanings described below. “Change in Control” generally includes the occurrence of any of the following events or circumstances:
“Cause” generally means (i) the willful and continued failure of the officer to perform “Good reason” generally means (i) the assignment of duties inconsistent with the officer’s position, authority, duties or responsibilities in effect at the time of the change in control, or any other action resulting in a diminution in such position, authority, duties or responsibilities, other than isolated and inadvertent action not taken in bad faith that is remedied promptly; (ii) failure to provide the employment compensation and benefits required under the change in control agreement, other than an isolated and inadvertent failure not occurring in bad faith that is remedied promptly; or (iii) a relocation or substantial change in the officer’s workplace or the company’s requiring the officer to travel on company business to a substantially greater extent than required immediately prior to the change in control. Changes to Form of Change in Control Agreement. The Key revisions
In include:
Change in Control
Equity Acceleration In the event of a change in control of PPG, the Company stock plans and award agreements
Change in Control
Our median employee’s Please keep in mind that under
PAY VERSUS PERFORMANCE Securities and Exchange Commission rules adopted in 2022 pursuant to the Dodd-Frank Act require most companies with publicly traded stock in the United States to describe the relationship between compensation actually paid (“CAP”) to their named executive officers, as calculated in accordance with the Securities and Exchange Commission's rules, and the Company’s performance represented by total shareholder return (“TSR”), net income and a Company-selected financial performance measure. To determine the executive compensation that is “actually paid” for the principal executive officer (“PEO”) and non-PEO named executive officers (“non-PEO NEOs”) in a given year, companies are required to make certain adjustments to the total executive compensation reported in the summary compensation table (“SCT”) (see page 58) for pension and equity awards that are calculated in accordance with U.S. GAAP.
The Pay Versus Performance table below presents this information for PPG. The significant reduction in the compensation actually paid for 2022 is due to (a) the Company’s stock price at December 31, 2022 versus December 31, 2021 and (b) the Company’s TSR share payout percentage for the three performance periods outstanding at December 31, 2022 compared to the fair value of these awards when granted. The TSR shares for the 2020-2022 performance period reflect a payout of 0.0%. The TSR shares for the 2021-2023 performance period reflect an estimated payout of 0.0%. The TSR shares for the 2022-2024 performance period reflect an estimated payout of 54.6%. Pay Versus Performance Table (2020-2022)
A reconciliation of PEO SCT total compensation to CAP is provided in the following table. PEO SCT Total Compensation to CAP Reconciliation (2020-2022)
A reconciliation of average non-PEO SCT total compensation to CAP is provided in the following table. Average Non-PEO NEOs SCT Total Compensation to CAP Reconciliation (2020-2022)
The three items listed below represent the most important financial performance measures used by PPG to link compensation actually paid to our named executive officers for 2022 to the Company’s performance:
Please see “Annual Compensation” and “Long-Term Incentive Compensation” on pages 48 through 56 for a description of how these metrics are used in our executive compensation program. As shown in the chart below, the Company’s TSR performance for the immediately preceding three years was aligned with the companies included in the peer group, and when the six-year TSR is compared to peers, the Company has outperformed the peers. The peer group consists of: 3M Co., Akzo Nobel N.V., Axalta Coatings Systems Ltd., Dow, Inc., Dupont de Nemours, Inc., Eastman Chemical Co., Masco Corp., RPM International Inc., and The Sherwin-Williams Co.
As shown in the chart below, the PEO’s and the Non-PEO NEOs’ CAP amounts are aligned with the Company’s TSR. This is primarily due to the Company’s use of equity incentives, which are tied directly to stock price in addition to the Company’s financial performance. As shown in the chart below, the Company’s CAP is aligned with the Company's net income. The Company does not use net income to determine compensation levels or incentive plan payouts.
The chart below which compares the PEO’s and the other non-PEO NEOs’ CAP to PPG’s company-selected measure, adjusted earnings per diluted share, indicates that there is a very strong relationship between adjusted earnings per diluted share and CAP. This is primarily due to the Company's use of equity incentives, which are tied directly to stock price and earnings growth in addition to the Company's financial performance.
PROPOSAL 2: Advisory Vote on Approval of the Compensation of the Named Executive Officers
We encourage shareholders to review the section of this Proxy Statement relating to executive compensation on pages
The following charts contain adjusted
*2019 Adjusted Earnings Per Diluted Share includes $0.16 for the year-over-year impact of foreign currency translation. **Beginning in 2021, the Company reports adjusted net income and adjusted earnings per diluted share excluding amortization expense relating to intangible assets from completed acquisitions. Adjusted earnings per diluted share for 2020 has been recast to exclude acquisition-related amortization expense.***Beginning with the calculation of the 2022 annual incentive award, adjusted net income from continuing operating as used for determining compensation excludes one half of the full year earnings impact of foreign currency translation versus the Company’s 2022 plan. As such, 2022 adjusted earnings per diluted share includes a benefit of $0.17 representing one half of the effect of foreign currency translation versus plan. Adjusted
from continuing operations to reported
Accordingly, you are asked to vote on the following resolution: RESOLVED: The Board strongly endorses the Company’s executive compensation program and recommends that the shareholders vote in favor of the following resolution: that the shareholders approve the compensation of the Company’s named executive officers as described in this Proxy Statement on pages Because the vote is advisory, it will not be binding upon the Board or the Vote Required Adoption of the resolution approving the compensation of the Company’s named executive officers will require the affirmative vote of more than
PROPOSAL 3: Advisory Vote on the Frequency of Future Advisory Votes on Executive Compensation
In 2017, the Company last asked its shareholders to recommend the frequency of future say-on-pay votes. At that time, the Board recommended and shareholders agreed that PPG should hold a say-on-pay vote annually. In keeping with that recommendation, the Company has held a say-on-pay vote annually. Since 2023 marks the sixth year since the last shareholder recommendation, the Company is required to ask its shareholders again to recommend the frequency of future say-on-pay votes. As it did in 2011 and 2017, the Board has determined that an advisory vote on executive compensation every year is the best approach for the
The proxy card provides shareholders with the opportunity to choose one of four options (holding the vote every one, two or three years, or abstaining) and, therefore, shareholders will not be voting to approve or disapprove the Board's recommendation but to convey their recommendation to the Board as to how frequently the Company should hold future advisory votes on executive compensation. Although this advisory vote regarding the frequency of say-on-pay votes is non-binding on the Board, the Board and the Vote Required The frequency of
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Service Fees Paid to the Independent Registered Public Accounting Firm
The Audit Committee The
PROPOSAL 4:Ratification of Independent Registered Public Accounting Firm The Audit Committee of the Board of Directors has appointed PricewaterhouseCoopers LLP as our independent registered public accounting firm for It is intended that the shares represented by each proxy will be voted, in the discretion of the persons appointed as proxies, FOR the ratification. If the selection of PricewaterhouseCoopers LLP is not ratified, the Audit Committee will reconsider the appointment of the Company’s independent registered public accounting firm. Even if the selection of PricewaterhouseCoopers LLP is ratified by our shareholders, the Audit Committee in its discretion could decide to terminate the engagement of PricewaterhouseCoopers LLP and engage another firm if the committee determines such action to be necessary or desirable. Vote Required The ratification of PricewaterhouseCoopers LLP as our independent registered public accounting firm for
PROPOSAL 5:Shareholder Proposal for an Independent Board Chair The AFL-CIO Equity Reserve Funds, the owner of 66,248 shares of PPG stock, has advised us that it intends to present the shareholder proposal below for action at the Annual Meeting. The shareholder proposal and the supporting statement are presented exactly as received from the proponent in accordance with the rules of the Securities and Exchange Commission, and we disclaim any responsibility for their content. Shareholder Proposal RESOLVED: Shareholders of PPG Industries, Inc. (the “Company”) urge the Board of Directors (the “Board”) to adopt a policy to require that the Chair of the Board (the “Chair”) shall be an independent director who has not previously served as an executive officer of the Company. This policy shall apply prospectively so as not to violate any contractual obligations, with amendments to the Company's governing documents as needed. The policy should also specify the process for selecting a new independent Chair if the current Chair ceases to be independent between annual meetings of shareholders. Compliance with the policy may be excused if no independent director is available and willing to be Chair. SUPPORTING STATEMENT We believe that an independent Chair will enhance the independent leadership of the Board. In our opinion, the Board’s oversight of management can be diminished when the Board Chair is not an independent director. We favor having an independent Board Chair to provide a more robust oversight of risk including of environmental, social, and governance issues. Independent board chain have become more common in recent years. In 2021, 37 percent of S&P 500 boards were chaired by an independent director, compared to 21 percent a decade ago.1 Our Company has announced that Michael McGarry intends to retire as Executive Chairman of the Company on October 1, 2023. Prior to Tim Knavish’s appointment as Company CEO, Mr. McGarry had served as Chair and CEO since 2016. In our view, this leadership transition provides the opportunity for the Board to appoint an independent director as Chair. We note that Mr. McGarry joined the Company in 1981 and Mr. Knavish joined the Company in 1987. While this long service with the Company is commendable, we believe that having an independent director serve as Chair will bring a valuable outside perspective to Board deliberations. According to Institutional Shareholder Services, “boards with independent leadership (either via an independent Chair or a Lead Director) are more likely to be more diverse, have more balance tenure, are more responsive to shareholders, while their CEO pay levels are less likely to be excessive relative to peers.”2 According to Glass Lewis, “shareholders are better served when the board is led by an independent chairman who we believe is better able to oversee the executives of the Company and set a pro-shareholder agenda without management conflicts that exist when the CEO or other executive also serves as a chairman.”3 For these reasons, we urge shareholders to vote FOR this resolution. Board of Directors’ Statement in Opposition to the Shareholder Proposal PPG’s Board believes that the interests of its shareholders are best served when the Board has the flexibility to determine PPG’s leadership structure. Under the Company's Corporate Governance Guidelines, the Board has the authority to determine whether the positions of Chair of the Board and Chief Executive Officer should be held by the same or different persons. The shareholder proposal seeks to mandate one rigid leadership structure for all circumstances and would therefore prevent our directors from determining the most appropriate leadership structure for PPG’s Board at any given time. The Board believes that the Company and its shareholders are best served when the Board holds the ability to determine its own leadership structure. At the Company’s 2021 Annual Meeting, a similar shareholder proposal requiring the appointment of an independent Chair was not approved by the Company’s shareholders. The Board has determined that the appropriate structure for the Board at this time is for Mr. McGarry, our former Chief Executive Officer, to serve as Executive Chairman of the Board, while also providing for the counterbalance of a strong 1Spencer Stuart, 2021 U.S. Spencer Stuart Board Index, 2021, https://www.spencerstuart.com//media/2021/october/ssbi2021/us-spencer-stuart-board-index-2021.pdf 2Institutional Shareholder Services, Independent Board Leadership Matters: Evidence from Governance Practices, November 9, 2018, https://www.issgovernance.com/library/indcpcndent-board-leadership-matters/ 3Glass Lewis, In-Depth: Independent Board Chairman, March 2016, https://www.g]asslewis.com/wpcontent/uploads/2016/03/2016-In-Depth-Report-INDEPENDENT-BOARD-CHAIRMAN.pdf.
independent Lead Director, fully independent Board committees, and other good governance practices as described below and elsewhere in this Proxy Statement. The Board believes that Mr. McGarry is the best person to serve as Chairman because he is the director most familiar with our business and industry and the director most capable of identifying strategic priorities, communicating these to the Board and executing our business strategy. The Board believes Mr. McGarry’s service as Executive Chairman creates a highly effective bridge between the Board and management and provides the leadership to execute our business strategy and create shareholder value. In addition, having Mr. McGarry continue to serve as Executive Chairman demonstrates to our employees, suppliers, customers, shareholders and other stakeholders that PPG has undertaken a thoughtful and measured leadership transition. Mr. McGarry’s Board leadership will allow for the continued, orderly transition of the Chief Executive Officer role to Mr. Knavish and will allow Mr. McGarry to continue to mentor Mr. Knavish as he begins his tenure as PPG’s Chief Executive Officer. Having Mr. McGarry serve as Executive Chairman also provides the Board time to consider the best Board leadership approach for PPG after Mr. McGarry retires based on the Company’s current circumstances. This flexibility would not be possible in the future if the shareholder proposal is approved. At least annually, the Board reexamines our corporate governance policies and Board leadership structure to ensure that it provides the optimal structure for PPG given the circumstances at the time. While the Board has believed that the combined role of the Chair and Chief Executive Officer strikes an appropriate balance that does not constrain independent oversight of the Company, the Board recognizes that in the future there may be circumstances under which an independent Board Chair would be appropriate. PPG’s Board has implemented robust governance structures and practices that provide for accountability, strong independent leadership, and effective independent oversight of the Company.
Through these responsibilities, the Lead Director provides independent oversight of management and meaningful coordination between our Executive Chairman and our independent directors.
Because of these strong governance structures, the Board does not believe that a policy mandating an independent Chair is necessary to achieve effective independent leadership and management oversight. It is instructive that over 60% of S&P 500 companies do not require an independent chair of the board as required by the shareholder proposal. According to the Spencer Stuart U.S. Board Index 2021, only 36% of S&P 500 companies have an independent chair of the board (available at https://www.spencerstuart.com/research-and-insight/us-board-index). The Board believes that having the flexibility to appoint a single leader for the Company, coupled with an independent Lead Director with significant responsibilities, makes it unnecessary to have an absolute requirement that the Chair be an independent director. PPG’s Board believes that an independent Chair is not required to oversee PPG’s environmental, social and governance (“ESG”) risks. In its supporting statement, the proponent states, “We favor having an independent Board Chair to provide a more robust oversight of risk including of environmental, social, and governance issues.” Like the proponent, the Board of Directors recognizes the importance of independent oversight of the Company’s ESG programs and risks. The Board is actively engaged in PPG’s ESG programs and initiatives, and significant ESG risks are reviewed and evaluated by the Board and its committees as part of its ongoing oversight of the Company’s risk management. In 2021, the Board conducted a comprehensive review of its oversight of the Company’s ESG programs and practices to ensure that the Board or one of its committees has oversight responsibility for each of the ESG programs and practices that is significant to PPG. As a result of this review, the Board in 2021 revised our Corporate Governance Guidelines and the charters of each committee to more clearly specify the ESG programs and practices overseen by the Board and each of its committees. For more information about how the Board oversees PPG’s ESG programs, see “Corporate Governance—The Board’s Role in ESG.” Given the strong independent Board oversight of the Executive Chairman, the Chief Executive Officer and management and the Company’s robust corporate governance structures, including an empowered and effective independent Lead Director and effective Board oversight of PPG’s ESG efforts, the Board does not believe that a fixed policy requiring an independent Chair is in the best interests of PPG’s shareholders. Vote Required Adoption of the shareholder proposal requesting the Board of Directors to adopt a policy to require that the Chair of the Board shall be an independent director who has not previously served as an executive officer of the Company will require the affirmative vote of more than one half of the shares present, either in person or by proxy, and entitled to vote and voting (excluding abstentions) at the Annual Meeting.
EQUITY COMPENSATION PLAN INFORMATION The following table provides information as of December 31,
Beneficial Ownership Tables As of the close of business on the record date, February
The following table sets forth all shares of PPG common stock beneficially owned, as of February
When and where is the Annual Meeting? The Annual Meeting will be held on Thursday, April Why am I receiving these proxy materials? In connection with the solicitation of proxies by our Board of Directors to be voted at the If your shares were registered directly in your name with our transfer agent, Computershare Investor Services, as of the close of business on February If your shares were held in the name of a bank, brokerage account or other nominee as of the close of business on February What is included in these materials? These proxy materials include:
If you received printed versions of these materials by mail, these materials also include the proxy card or vote instruction form for the Annual Meeting. Why did I receive a notice in the mail regarding the Internet availability of proxy materials instead of printed proxy materials? In accordance with the rules of the Securities and Exchange Commission, instead of mailing a printed copy of our proxy materials to our shareholders, we have elected to furnish these materials by providing access to these documents over the Internet. Accordingly, on or about March What does it mean if I receive more than one set of proxy materials? It means you have multiple accounts at the transfer agent or with banks, brokers or other nominees. If you received more than one Notice of Internet Availability, you may need to enter separate electronic control voting numbers when voting by the Internet to ensure that all of your shares have been voted. If you received more than one proxy card or vote instruction form, please complete and provide your voting instructions for all proxy cards and vote instruction forms that you receive. How can I get electronic access to the proxy materials? The Notice of Internet Availability provides you with instructions regarding how to (1) view our proxy materials for the Annual Meeting on the Internet; (2) vote your shares after you have viewed our proxy materials; and (3) request a printed copy of the proxy materials. Our proxy materials are also available online at investor.ppg.com.
What am I voting on? You are voting on
What are the Board’s recommendations on how I should vote my shares? The Board of Directors recommends that you vote your shares as follows:
What are my choices when voting?
What vote is needed for the proposals to be adopted? As of the record date, February
How do I vote? You may vote your shares by any one of the following methods:
If you vote by the Internet or by telephone, you do not need to send in a proxy card or vote instruction form. The deadline for Internet and telephone voting will be 11:59 p.m., Eastern Time, on April What happens if I do not give specific voting instructions? The Board of Directors is asking for your proxy. Giving us your proxy means that you authorize us to vote your shares at the Annual Meeting in the manner you direct. If you (1) choose the “submit your vote” option without voting on each individual proposal when voting on the Internet or by telephone or (2) if you are a shareholder of record and sign and return a proxy card without giving specific voting instructions, then your shares will be voted in the manner recommended by our Board on all matters presented in this Proxy Statement. If your shares are held by a broker, bank or other nominee, the broker, bank or nominee will ask you how you want to vote your shares. If you give the broker, bank or nominee instructions, your shares will be voted as you direct. If you do not give instructions, your broker, bank or nominee may vote your shares in its discretion for the ratification of the appointment of PricewaterhouseCoopers LLP as our independent registered public accounting firm for How can I change or revoke my vote after I have voted? You have the right to change your vote or revoke your proxy before it is exercised at the Annual Meeting. You may vote again on a later date on the Internet or by telephone (only your latest Internet or telephone proxy submitted prior to the Annual Meeting will be counted), by signing and returning a new proxy card or vote instruction form with a later date, or by attending the virtual Annual Meeting and voting
How will shares in employee benefit plans be voted? This Proxy Statement is being used to solicit voting instructions from you with respect to shares of PPG common stock that you own, but which are held by the trustees of a retirement or savings plan for the benefit of you and other plan participants. Shares held in the benefit plans that are entitled to vote will be voted by the trustees pursuant to your instructions. Shares held in any employee benefit plan that you are entitled to vote, but do not vote, will not be voted by the trustees. You must instruct the trustees to vote your shares by utilizing one of the voting methods described above.
Who will count and certify the votes? Representatives of Corporate Election Services and the staff of our corporate secretary and Investor Relations offices will count the votes and certify the election results. The results will be publicly filed with the Securities and Exchange Commission on a Form How can I attend the virtual Annual Meeting?
Shareholders of PPG as of the close of business on February 17, 2023, the record date, or those that hold a valid proxy for the meeting, are entitled to participate in and ask questions at the Annual Meeting. All shareholders wishing to attend the virtual Annual Meeting must pre-register no later than 5:00 p.m., Eastern Time, on April 19, 2023. Registered Shareholders Shareholders of record as of the record date may register to participate in the Annual Meeting Beneficial Shareholders Shareholders whose shares are
Listen-Only, Live Webcast A listen-only, live webcast of the virtual Annual Meeting will also be available to all shareholders and guests who do not pre-register at https://www.cesonlineservices.com/ppg23_vm. Pre-registration is required to vote and submit questions during the meeting. We encourage you How can I ask questions at the virtual Annual Meeting? We will have a question and answer session during the Annual Meeting. To ask a question during the Annual Meeting, you must
Investor Relations website at
How do I obtain a copy of materials related to corporate governance? Our Corporate Governance Guidelines, charters of each standing committee of our Board of Directors, Global Code of Ethics, Code of Ethics for Senior Financial Officers and other materials related to our corporate governance are published on the Corporate Governance section of our website at Who is soliciting my vote and what are the solicitation expenses? This solicitation is being made on behalf of our Board of Directors, but may also be made without additional compensation by our directors, officers or employees by telephone, facsimile, How can I submit a proposal for consideration at the To be considered for the Any shareholder whose proposal is not included in our
19, 2024. How can I recommend someone as a candidate for director? A shareholder who wishes to recommend or nominate a candidate for director of PPG may write to the To be effective for consideration at the
Householding Information PPG and some banks, brokers and other nominees are participating in the practice of “householding” proxy materials. This means that shareholders who share the same address may not receive separate copies of proxy materials, unless we have received instructions to the contrary. If, at any time, you no longer wish to participate in householding and would prefer to receive a separate set of the proxy materials, or if you are receiving multiple copies of the proxy materials and wish to receive only one, please notify your bank, broker or other nominee if your shares are held in a brokerage account or us if you hold registered shares. We will promptly deliver an additional copy of the proxy materials to you, without charge, if you write to Investor Relations at PPG Industries, Inc., One PPG Place, Other Matters So far as is known, no matters other than those described herein are expected to come before the Annual Meeting. It is intended, however, that the proxies solicited hereby will be voted on any other matters that may properly come before the Annual Meeting, or any adjournment thereof, in the discretion of the person or persons voting such proxies unless the shareholder has indicated on the proxy card that the shares represented thereby are not to be voted on such other matters. Pittsburgh, Pennsylvania March
RECONCILIATION OF PPG believes Net income from continuing operations (attributable to PPG) and earnings per share
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