UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A

(RULE 14a-101)

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No.    )

 

 

Notice of Annual Meeting

of Stockholders

and Proxy Statement

 

 

*The 20222024 Annual Meeting will be a virtual meeting conducted solely online and can be attended by visiting www.virtualshareholdermeeting.com/NVST2022. A list of stockholders entitled to vote at the 2022 Annual Meeting will be accessible to stockholders during the meeting on the meeting website.NVST2024.

Items of Business:

2. To ratify the selection of Ernst & Young LLP as Envista’s independent registered public accounting firm for the year ending December 31, 2022.2024.

3. To approve on an advisory basis Envista’s named executive officer compensation.

4. To approve a proposal to amend our Second Amended and Restated Certificate of Incorporation to include an officer exculpation provision.

5. To consider and act upon such other business as may properly come before the meeting or any adjournment thereof.

YOUR VOTE IS IMPORTANT. PLEASE SUBMIT YOUR PROXY OR VOTING INSTRUCTIONS AT YOUR EARLIEST CONVENIENCE, WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING.

Most stockholders have a choice of voting over the Internet, by telephone or by using a traditional proxy card or voting instruction form. Please refer to the attached proxy materials or the information forwarded by your bank, broker or other holder of record to see which voting methods are available to you.

IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE STOCKHOLDER MEETING TO BE HELD ON MAY 24, 2022:21, 2024:

April 13, 20228, 2024

To assist you in reviewing the proposals to be acted upon at our 20222024 Annual Meeting, below is summary information regarding the meeting. For more information about these topics, please review the complete Proxy Statement. This Proxy Statement and proxy card are first being sent to our stockholders on or about April 13, 2022.8, 2024.

* See Appendix A for a reconciliation of GAAP to non-GAAP measures. Core Sales Growth and Adjusted Diluted EPS as reported inAll financial metrics relate to our Financial Highlights are for continuing operations only, and do not include sales from the divested KaVo Treatment Unit and Instruments business (the “Divestiture”). Our measures under our 2021 Incentive Compensation Plan as described in further detail under “Compensation Discussion and Analysis” are consolidated and include both continuing and discontinued operations, as the Compensation Committee did not contemplate the Divestiture at the time it set the 2021 performance targets.except for cash flows measures.

Our success depends on our ability to attract, develop and retain a talented employee base. We aspire to help our employees thrive both personally and professionally. As part of these efforts, we strive to embody our core values, offer a competitive compensation and benefits program, foster aan inclusive community where everyone feels included, respected and engaged, and provide ample professional development opportunities.

Compensation and Benefits Program

Diversity and Inclusion

Learning and Development Opportunities

We aim to empower our employees to thrive in their current roles, as well as to support employees’ aspirationaspirations to move into different roles. We have a promote-from-within culture with opportunities across our operating companies. We periodically assess succession planning for certain key positions and review our workforce to identify high potential employees for future growth and development. We support our employees through a multitude of training and development programs, including training on our EBS tools through our Envista Business System University, individual development plans (which encourages our employees to take charge of their learning and growth opportunities and provides access to hundreds of online courses)opportunities), job rotations, and various management trainings. We also have several programs focused on early career development, including internship programs and our six-year General Management Development Program. This commitment to our employees’ professional development reflects both our Continuous Improvement and Leadership core values.

Employee Engagement

Safe Work Environment

We value the safety of our employees and have leveragedin 2023, we updated our technological resourcesbi-annual EHS Risk Assessment tool to institute work-from-home arrangements for most of our employees in response to the COVID-19 pandemic. At our manufacturing sites and office locations where employees are required to work on-site, we have implemented significant procedures to help ensure the health and safety of our workforce, that have included daily health and temperature screenings, mandatory face masks, social distancing guidelines, contact tracing, staggered shifts and frequent disinfection processes. Environmentalincrease environmental health and safety (“EHS”) results and engagement. EHS significant sites, such as manufacturing, distribution, research and development sites and large offices, are supported through a combination of on-site and remote EHS professionals. Incident reporting and investigation, auditing, and corporate oversight provide for a collaborative and transparent environment to address and minimize potential gaps.

From the start, establishing Envista as a company that setshas sought to set a high standard of performance on environmental, social, and governance (“ESG”) measures has been a priority.measures. Our sustainability efforts are led by our senior management and overseen by our Nominating and Governance Committee, along with our Board of Directors. We launchedreleased our Inauguralthird annual Sustainability Report in June 2021. The reportNovember 2023 (the “2022 Sustainability Report”). It is designed to provide better transparency regarding our ESG efforts, and it can be found on our public website at https://www.envistaco.com/sustainability. We encourage you to read the report2022 Sustainability Report for information regarding our ESG initiatives, including our five areas of sustainability priorities:

Highlights from the report2022 Sustainability Report include:

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* Denotes less than 1% of the outstanding Common Stock on March 30, 202225, 2024

As of the Annual Meeting, our Board is fully declassified and all directors are elected annually. At the Annual Meeting, stockholders will be asked to elect each of the current Class III director nominees identified belowAmir Aghdaei, Wendy Carruthers, Kieran Gallahue, Scott Huennekens, Barbara Hulit, Vivek Jain, Daniel Raskas, and Christine Tsingos (who have been recommended by the Nominating and Governance Committee, nominated by the Board and currently serve as Class III Directorsdirectors of Envista) to serve until the 20232025 Annual Meeting of Stockholders and until his or her successor is duly elected and qualified.

We have set forth below information as of March 30, 202225, 2024 relating to each nominee for election as director, and each director continuing in office, including: his or her principal occupation and any board memberships at other public companies during the past five years; the other experience, qualifications, attributes or skills that led the Board to conclude that he or she should continue to serve as a director of Envista; the year in which he or she became a director; and age. Please see “Corporate Governance – Director Nomination Process” for a further discussion of the Board’s process for nominating Board candidates. Each of the nominees has consented to serve if elected. In the event a nominee declines or is unable to serve, the proxies may be voted in the discretion of the proxy holders for a substitute nominee designated by the Board, or the Board may reduce the number of directors to be elected. We know of no reason why this will occur.

Vivek Jain has served as CEO and Chairman of the Board of ICU Medical, Inc., a global medical technology company specializing in infusion therapy, since February 2014.  Prior to this role, Mr. Jain served at CareFusion Corporation, a global medical technology company, as President of Procedural Solutions from 2011 to February 2014 and as President, Medical Technologies and Services from September 2009 until 2011. Before joining CareFusion Corporation, Mr. Jain served as the Executive Vice President-Strategy and Corporate Development of Cardinal Health, Inc., a health care services company, from June 2007 until August 2009. Mr. Jain served as Senior Vice President, Business Development and M&A for the Philips Medical Systems business of Koninklijke Philips Electronics N.V., an electronics company, from 2006 to August 2007. Mr. Jain served as an investment banker at J.P. Morgan Securities, Inc., an investment banking firm, from 1994 to 2006. Mr. Jain’s last position with J.P. Morgan was as Co-Head of Global Healthcare Investment Banking from 2002 to 2006. Mr. Jain brings to Envista significant CEO and Chairman experience at a public company and a deep background in the medical technology and healthcare fields, which are areas of particular value to our Board.

Christine Tsingos served as Executive Vice President and Chief Financial Officer at Bio-Rad Laboratories, Inc., a manufacturer of life science research and clinical diagnostics products, from 2002 to May 2019. Ms. Tsingos is also currently a member of the Board of Directors of each of Onto Innovation Inc. (formerly Nanometrics Incorporated), Varex Imaging Corporation and Telesis Bio Inc. (formerly Codex DNA, Inc. Inc).

Our Board of Directors recognizes that enhancing and protecting long-term value for our stockholders requires a robust framework of corporate governance that serves the best interests of all our stockholders.

As part of its ongoing commitment to good corporate governance, our Board of Directors has codified its corporate governance practices into a set of Corporate Governance Guidelines and adopted written charters for each of the Audit Committee, the Compensation Committee, and the Nominating and Governance Committee, and the Finance Committee of the Board. The Board of Directors has also adopted for the Company our Code of Conduct that includes, among others, a code of business conduct and ethics for directors, officers (including our principal executive officer, principal financial officer and principal accounting officer) and employees. The Corporate Governance Guidelines, Audit Committee Charter, Compensation Committee Charter, Nominating and Governance Committee Charter, and Code of Conduct referenced above are each available in the “Investors – Governance” section of our website at http://www.envistaco.com.

The Board has separated the positions of Chairperson and CEO because it believes that the separation of the positions best enables the Board to ensure that our businesses, risks, opportunities and affairs are managed effectively and in the best interests of our stockholders.

The entire Board selects its Chairperson, and our Board has selected Scott Huennekens, an independent director, as its Chairperson in light of Mr. Huennekens’ independence and his deep experience and knowledge with corporate governance, board management, stockholder engagement, risk management and extensive background in the medical device field.

As the independent Chairperson of the Board, Mr. Huennekens leads the activities of the Board, including:

In the event that the Chairperson of the Board is not an independent director, the Corporate Governance Guidelines provide that the independent directors, upon recommendation from the Nominating and Governance Committee, will select by majority vote an independent director to serve as the Lead Independent Director with the authority to:

The Board’s non-management directors meet in executive session following the Board’s regularly-scheduled meetings, with the executive sessions chaired by the independent Chairperson.meetings. In addition, the independent directors meet as a group in executive session at least once a year. The executive sessions of non-management directors and the executive sessions of independent directors are each chaired by the independent Chairperson.

Our management has day-to-day responsibility for assessing and managing our risk exposure and the Board and its committees oversee those efforts, with particular emphasis on the most significant risks facing us. Each committee reports to the full Board on a regular basis, including as appropriate with respect to the committee’s risk oversight activities. Since risk issues often overlap, committees from time to time request that the full Board discuss particular risks.

In determining to separate the position of the CEO and the Chairperson, and in determining the appointment of the Chairperson of the Board and the Chairs of the Committees, the Board and the Nominating and Governance Committee considered the implementation of a governance structure and appointment of chairpersons with appropriate and relevant risk management experience that would enable the Company to efficiently and effectively assess and oversee its risks.

Enterprise Risk Oversight by the Board

The Board oversees the Company’s risk management processes directly and through its committees. In general, the Board oversees the management of risks inherent in the operation of the Company’s businesses, the implementation of its strategic plan, its acquisition and capital allocation program, its capital structure and liquidity and its organizational structure, and also oversees the Company’s risk assessment and risk management policies. In addition, at least on an annual basis or more frequently as deemed appropriate by the Board, the Board reviews with senior leaders of the Company, the Company’s enterprise risk management, with particular focus on the enterprise risks and opportunities with the greatest impact and highest probability. Furthermore, at least on an annual basis or more frequently as deemed appropriate by the Board, the Board reviews with the General Counsel our insurance policies, including our D&O insurance policy, general liability policy, and our cyber liability insurance policy.

Portfolio and Operating Segment Risk Oversight by the Board

At each Board meeting, the Board oversees the Company’s performance and execution against the strategic goals for the Company’s operating segments, overall portfolio, and innovation, including overseeing the corresponding management of risks and opportunities. Furthermore, the Finance Committee meets with management to assess acquisition and other corporate development strategies as appropriate.

Human Capital Oversight by the Board

The Board is actively engaged in overseeing the Company’s people and culture strategy and reviews human capital matters at each quarterly meeting, including periodic updates on succession planning, leadership development, talent acquisition and retention, diversity and inclusion, employee engagement, total rewards, and culture of the Company, among other topics. The Compensation Committee oversees our executive and equity compensation programs. We evaluate and manage risks relating to our human capital strategy as part of our enterprise risk management program. See page 43 for more information on our human capital resources and culture.

Cybersecurity Risk Oversight

The Board has delegated to the Audit Committee the responsibility of exercising oversight with respect to the Company’s cybersecurity risk management and risk controls. Consistent with such delegation, our Vice President,Chief Information TechnologyOfficer provides periodic reports to the Audit Committee regarding the Company’s cybersecurity program, including the Company’s information risk management and oversight, security education and training, and cyber threat detection and response processes.processes, and relevant internal and industry cybersecurity attacks. The Board also receives a report out on cybersecurity issues and governance at least annually, with periodic updates as needed. We evaluate and manage risks relating to cybersecurity as part of our enterprise risk management program. We perform an annual assessment across the Company to identify and review potential risks. Risks are prioritized based on threat models to improve cybersecurity throughout the Company.

To date, no attempted cyber-attackcyberattack or other attempted intrusion on our information technology networks has resulted in a material adverse impact on our business strategy, results of operations, or financial results, or in any penalties or settlements.condition. In the event an attack or other intrusion were to be successful, we have a response team of internal and external resources engaged and prepared to respond. We also maintain cyber liability insurance to help mitigate potential liabilities resulting from cyber issues.

Sustainability Risk Oversight

The Board has delegated to the Nominating and Governance Committee the responsibility of exercising oversight with respect to the Company’s sustainability strategy and reporting. Consistent with such delegation, management provides quarterlyperiodic reports and updates to the Nominating and Governance Committee regarding the Company’s sustainability program and strategies, including the corresponding risks and opportunities, goals, progress, stockholder engagement and disclosure. Additionally, the Audit Committee oversees the internal controls for the Company’s sustainability reporting. We evaluate and manage risks relating to sustainability issues, including climate-related risks, as part of our enterprise risk management program. See page 54 for further discussion on our Sustainability program.

Enterprise Risk Management Committee

The Company’s Enterprise Risk Management (“ERM”) Committee (consisting of members of senior management) leads the Company’s enterprise risk management program. The ERM Committee inventories, assesses and prioritizes the most significant risks facing the Company as well as related mitigation efforts. The ERM Committee periodically updates the Audit Committee on its processes and reports its findings to the Board at least once a year.

The Board has determined that Mses. Carruthers Hulit and Tsingos and Messrs. Gallahue, Huennekens, Jain, and JainRaskas are independent directors under the applicable rules of the NYSE. Mr. Huennekens serves as independent Chairperson of the Board.

The Board assesses on a regular basis, and at least annually, the independence of directors and, based on the recommendation of the Nominating and Governance Committee, makes a determination as to which members are independent.

The Audit Committee is governed by a charter that complies with the rules of the NYSE. A copy of the Audit Committee Charter is available on the “Investors – Governance” section of our website.

The Audit Committee relies on the expertise and knowledge of management, the internal auditor, and the independent auditor in carrying out its oversight responsibilities. Management is responsible for the preparation, presentation, and integrity of our financial statements, accounting and financial reporting principles, internal control over financial reporting, and disclosure controls and procedures designed to ensure compliance with accounting standards, applicable laws, and regulations. Management is also responsible for objectively reviewing and evaluating the adequacy, effectiveness, and quality of our system of internal control over financial reporting. Our independent auditor, Ernst & Young LLP, is responsible for performing an independent audit of our financial statements and expressing an opinion on the conformity of those financial statements with accounting principles generally accepted in the United States.

The Audit Committee also prepares a report of the Audit Committee as required by the SEC to be included in this Proxy Statement. The Audit Committee typically meets in executive session, without the presence of management, at each regularly scheduled meeting, and reports to the Board on its actions and recommendations at each regularly scheduled Board meeting.

At the May 2021 Board meeting, the Board made a determination that the service of Ms. Tsingos on the audit committee of a fourth public company (including the Company) would not impair her ability to effectively serve on the Company’s Audit Committee. The Board reaffirmedhas reviewed this determination at its February 2022 Board meetingservice on an annual basis thereafter and will review annually.determined that it does not impair Ms. Tsingos’ ability to serve on the Company’s Audit Committee.

The Compensation Committee is governed by a charter that complies with the rules of the NYSE. A copy of the Compensation Committee Charter is available on the “Investors – Governance” section of our website. Each member of the Compensation Committee is an “outside director” for purposes of Section 162(m) of the Internal Revenue Code (“Section 162(m)”), a “non-employee director” for purposes of Rule 16b-3 under the Exchange Act and, based on the determination of the Board, independent under the NYSE listing standards and under Rule 10C-1 under the Exchange Act. The Committee typically meets in executive session, without the presence of management, at its regularly scheduled meetings. Under the terms of its charter, the Compensation Committee has the authority to form, and delegate authority to, such standing and ad-hoc subcommittees as it determines necessary or desirable. The Compensation Committee Charter also provides that, to the extent permitted by applicable law and the provisions of a given equity-based plan, and consistent with the requirements of applicable law and such equity-based plan, the Compensation Committee may delegate to one or more executive officers of the Company, or a sub-committee of the Compensation Committee formed for such purpose, the power to make grants and awards (other than grants and awards to any Company director or any officer subject to Section 16 of the Exchange Act) pursuant to such equity-based plan to employees of the Company or any subsidiary of the Company.

Our human resources and legal departments also assist the Committee Chair in scheduling and setting the agendas for the Committee’s meetings, prepare meeting materials and provide the Committee with data relating to executive compensation as requested by the Committee.

The Nominating and Governance Committee is governed by a charter that complies with the rules of the NYSE. A copy of the Nominating and Governance Committee Charter is available on the “Investors – Governance” section of our website. The Board has determined that each member of the Nominating and Governance Committee is independent within the meaning of the NYSE listing standards. The Nominating and Governance Committee typically meets in executive session, without the presence of management, at each regularly scheduled meeting, and reports to the Board on its actions and recommendations at each regularly scheduled Board meeting.

The Nominating and Governance Committee recommends to the Board director candidates for nomination and election at the annual meeting of stockholders and, in the event of vacancies between annual meetings, for appointment to fill such

The Nominating and Governance Committee annually reviews with the Board the skills, knowledge, experience, background and attributes required of Board nominees, considering current Board composition and the Company’s circumstances. In making its recommendations to our Board, the Nominating and Governance Committee considers the required standards and qualifications noted above, as well as, among others, the following skills, knowledge, experience, background and attributes:

The Nominating and Governance Committee takes into account a candidate’s ability to contribute to the diversity of perspective and analysis from the Board and, as such, believes it is important to consider attributes such as race, ethnicity, gender, age, education, cultural experience, and professional experience in evaluating candidates who may be able to contribute to the diverse perspective and practical insight of the Board as a whole. Although diversity is an important factor in assessing candidates as director nominees, neither the Board nor the Nominating and Governance Committee has a formal diversity policy. Furthermore, the Board does not make any particular weighting of diversity or any other characteristic in evaluating nominees and directors.

In addition to Mr. Aghdaei, our current executive officers include Patrik Eriksson, Jean-Claude “JC” Kyrillos,Robert Befidi, Eric Conley, Stephen Keller, Mark E. Nance, and Mischa M. Reis and Howard H. Yu.Reis. Information concerning our executive officers, other than Mr. Aghdaei, whose information can be found under “Proposal 1 — Election of Directors” above, follows.

Under our written Related Person Transactions Policy adopted by the Board, the Nominating and Governance Committee of the Board is required to review and, if appropriate, approve all related person transactions prior to consummation whenever practicable. If advance approval of a related person transaction is not practicable under the circumstances or if our management becomes aware of a related person transaction that has not been previously approved or ratified, the transaction is submitted to the Nominating and Governance Committee at its next meeting. The Nominating and Governance Committee is required to review and consider all relevant information available to it about each related person transaction, and a transaction is considered approved or ratified under the policy if the Nominating and Governance Committee authorizes it according to the terms of the policy after full disclosure of the related person’s interests in the transaction. Related person transactions of an ongoing nature are reviewed annually by the Nominating and Governance Committee. The definition of “related person transactions” for purposes of the policy covers the transactions that are required to be disclosed under Item 404(a) of Regulation S-K promulgated under the Securities Act of 1933, as amended.

There were no transactions between the Company and any officer, director or nominee for director, or any affiliate of or person related to any of them, since January 1, 2021,2023, of the type or amount required to be disclosed under the applicable SEC rules.Item 404(a) of Regulation S-K.

This Compensation Discussion and Analysis (“CD&A”) describes our executive compensation philosophy and the pay programs provided to our Named Executive Officers (“NEOs”) for 2021.2023.