UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
SCHEDULE
(RULE 14a-101)
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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☐ | Preliminary Proxy Statement | |
☐ | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) | |
☒ | Definitive Proxy Statement | |
☐ | Definitive Additional Materials | |
☐ | Soliciting Material under §240.14a-12 |
VERIZON COMMUNICATIONS INC.
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box)all boxes that apply):
☒ | No fee | |||
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☐ | Fee paid previously with preliminary | |||
☐ | Fee computed on table in exhibit required by Item 25(b) per Exchange Act | |||
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Sustainability at Verizon Verizon gives people the ability to do more through technology, investments and actions designed to educate the 21st century workforce and promote environmental sustainability. SUSTAINABLE DEVELOPMENT We are taking action in support of the United Nations' Sustainable Development Goals: Improving Global Resource Efficiency Reducing Environmental Impact: Verizon is committed to delivering a lasting, positive impact on the environment by cutting our own carbon intensity - the amount of carbon our business emits divided by the terabytes of data we transport over our networks - in half over the 2016 baseline by 2025. Weve also working towards sourcing renewable energy equivalent to 50% of our total electricity usage by 2025. Supporting Carbon Abatement: Verizons products and services - ranging from high speed internet that allows people to work remotely, smart grids that increase the efficiency of our power system, to telematics that improve fleet routing - help our customers use less energy, and therefore create fewer greenhouse gas emissions. Reducing Waste and Supporting Recycling We continue to work to reduce the environmental impact of our products through: Managing the materials we use in making them Reducing packaging volume Recycling, refurbishing and/or reusing our products, including the responsible management of out of service lead batteries Providing recycling information on product labels, and supporting public recycling Verizon received an on the Carbon Disclosure Projects 2018 evaluation and is ranked in CDPs Leadership scoring band. CDP runs a global voluntary disclosure system by which companies and cities disclose their environmental impacts to inform marketplace decision-making. Verizon chairs the Global e-Sustainability Initiative a consortium of ICT companies that collaborate to develop and share resources for achieving social and environmental sustainability through technology.Sustainability at Verizon Verizon gives people the ability to do more through technology, investments and actions designed to educate the 21st century workforce and promote environmental sustainability. SUSTAINABLE DEVELOPMENT We are taking action in support of the United Nations' Sustainable Development Goals: Improving Global Resource Efficiency Reducing Environmental Impact: Verizon is committed to delivering a lasting, positive impact on the environment by cutting our own carbon intensity - the amount of carbon our business emits divided by the terabytes of data we transport over our networks - in half over the 2016 baseline by 2025. Weve also working towards sourcing renewable energy equivalent to 50% of our total electricity usage by 2025. Supporting Carbon Abatement: Verizons products and services - ranging from high speed internet that allows people to work remotely, smart grids that increase the efficiency of our power system, to telematics that improve fleet routing - help our customers use less energy, and therefore create fewer greenhouse gas emissions. Reducing Waste and Supporting Recycling We continue to work to reduce the environmental impact of our products through: Managing the materials we use in making them Reducing packaging volume Recycling, refurbishing and/or reusing our products, including the responsible management of out of service lead batteries Providing recycling information on product labels, and supporting public recycling Verizon received an on the Carbon Disclosure Projects 2018 evaluation and is ranked in CDPs Leadership scoring band. CDP runs a global voluntary disclosure system by which companies and cities disclose their environmental impacts to inform marketplace decision-making. Verizon chairs the Global e-Sustainability Initiative a consortium of ICT companies that collaborate to develop and share resources for achieving social and environmental sustainability through technology. Supporting Quality Education Through the Verizon Innovation Learning initiative, we provide free technology, free internet access and hands-on immersive curricula in science, technology, engineering and math to students in need.
Q & A with our CEO
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How would you describe Verizon’s performance in 2018?
2018 was an outstanding year for Verizon, and I am proud of the team we have built and the foundation we have laid for 2019 and beyond. We finished 2018 by delivering solid financial and operational performance, and my conversations with our investors and analysts have been very positive. We remain confident in our vision.
2018 was a year that will be entered into the history books as the year that 5G became available to the consumer public, and Verizon was the first in the world to bring it to market. We launched 5G Home in Houston, Sacramento, Los Angeles, and Indianapolis in the fall and will be rolling out more cities in 2019. 5G promises to be the foundational technology of the Fourth Industrial Revolution, fundamentally transforming our world in ways that we can’t even imagine yet. 5G Home is helping us perfect our market offerings, receive feedback from customers, and dominate the conversation about this revolutionary technology as we prepare to offer it more widely and for mobile access in 2019.
2018 was also exciting for me personally as I transitioned to the role of CEO, and I can’t thank Lowell enough for being a great mentor and friend and for setting us up for a strong future. We are building on this seamless transition
and reorganizing the company into three business groups with three strong leaders at the helm: Ronan Dunne for Consumer, Tami Erwin for Business, and Guru Gowrappan for Media. We will assume this structure in Q2 of 2019, capitalizing on the success of 2018. This is the perfect foundation for Verizon 2.0, the next generation of our company.
Can you expand on the Verizon 2.0 strategy and the new direction in which you are taking the Company?
Verizon 2.0 is all about building on what made Verizon the best company in our industry and taking us to the next level. When I announced this to our employees, the V Team, I committed that the company was going to focus on very tangible goals in Verizon 2.0. These are improving customer satisfaction; continuing to be first in 5G and Intelligent Edge Network architecture; growing our Network-as-a-Service solutions; growing our services with Verizon Media and Verizon Connect; inviting our strategic partners to play a larger role in our ecosystem; and creating an inspiring work environment that embraces change and encourages curiosity and strategic risk taking.
This new direction is part of a strategic shift to focus on what makes Verizon the best in our industry: our
unrelenting focus on enabling our customers to do the amazing things they do every day with our networks and products. The wireless and wireline industries are at a crossroads, and our competitors are going in different directions to differentiate themselves. We don’t need to do that. We have the best networks, the best products, and are best positioned to help usher in the Fourth Industrial Revolution on 5G. Verizon 2.0 will help us to be prepared to capitalize on our inherent advantages.
What do you see as Verizon’s social and economic purpose? How do sustainability initiatives help achieve that purpose?
I believe, and I feel our customers and V Teamers believe, that Verizon must be a model for social global stewardship. It is difficult for one person to impact the world, but as a company with over 140,000 creative, passionate employees and millions of valued customers around the world, we have an opportunity to make our mark on issues that matter and to try to take the world in a better direction. Our company’s very purpose is to connect people and enable their creativity and vision. We believe we can help bring people together across cultures and continents to solve important problems.
Verizon is taking this responsibility seriously, and we will continue to strive to lift up people and voices with less opportunity through the work of our Foundation as well as in our everyday activities. For example, since access to the Internet and reliable communications services are essential to economic and educational success, we are in a unique position to help the next generation of students be better equipped for the future. Our Verizon Innovative Learning initiative delivers free technology, free access and innovative learning programs to under-resourced schools and students across America.
Our sustainability initiatives are another example of our conviction. Protecting our planet and its citizens must be integrated into everything we do, not just because our impact can be significant but also because it is the right thing to do. We have a responsibility to think about the world we live in as we are bringing our networks and products to market, and I want our company to be a leader in sustainability.
What kind of culture are you working to create at Verizon as the new CEO?
Culture is everything to me. When people love what they do and the place they work, their best ideas come to life to improve our organization, our services, and our world. I want people to be encouraged to take risks, to try new things, and to be willing to fail—and that comes from a strong culture. I travel around the world and try to meet with employees everywhere I go. I will stop by a Verizon store and ask our team what they want from their company, and they often tell me the same things. They want to be able to try new things and experiment to make their jobs and the customer experience better. They want leadership that understands that there is no one size fits all and that what works in one location may not work in another. And most importantly, they tell me that they want opportunity to shape their careers and to remain part of this exciting company’s journey as we all work together to change the world.
Encouraging that culture and the leadership that it requires is my number one internal priority. I want both new and experienced leaders to support their people and to expand their expertise by trying new things, and I want employees to know that we have their backs. And we will give it 100% effort and attention. That too is culture, and I see it as imperative to our company’s success.
Notice of Annual
Meeting of Shareholders
How to Votevote
Online | Phone |
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Shareholders as of the close of business on March 14, 2022, the record date, may vote at the meeting.
If you are a registered shareholder or Verizon savings plan participant, you may vote online at www.envisionreports.com/vz, by telephone or by mailing a proxy card. You may also vote in person at the annual meeting. If you hold your shares through a bank, broker or other institution, you will receive a voting instruction form that explains the various ways you can vote. We encourage you to vote your shares as soon as possible.
Advance registration is required to attend the meeting in person. Admission, voting and additional meeting information can be found beginning on page 66 of the proxy statement.
March 28, 2022
By Order of the Board of Directors,
William L. Horton, Jr.
Senior Vice President, Deputy General Counsel
and Corporate Secretary
Verizon Communications Inc.
1095 Avenue of the Americas
New York, New York 10036
Important Notice Regarding Availability of Proxy Materials for Verizon’s Shareholder Meeting to be Held on May 12, 2022
The 2022 Proxy Statement and 2021 Annual Report on Form 10-K are available at www.edocumentview.com/vz.
We are making the proxy materials first available on or about March 28, 2022.
Date and time
Thursday, May 12, 2022
8:45 AM, local time
Place
Marriott Dallas Las Colinas
223 West Las Colinas Boulevard
Irving, Texas 75039
Items of business
Elect the 11 Directors identified in the accompanying proxy statement
Approve, on an advisory basis, Verizon’s executive compensation
Ratify the appointment of the independent registered public accounting firm
Act on the shareholder proposals described in the proxy statement that are properly presented at the meeting
Consider any other business that is properly brought before the meeting
To our shareholders:
A message from Hans Vestberg, our Chair & CEO, and Clarence Otis, Jr., our Lead Director
Verizon’s corporate purpose to create the networks that move the world forward has never felt so vital. As technology becomes even more integral to our lives, Verizon’s networks are paving the way for a connected future that will allow us to reimagine what is possible for our customers and the communities we serve. Our priority is to execute on our Network-as-a-Service strategy and leverage our fiber infrastructure, spectrum breadth and depth, and technology expertise to carry our leadership in 4G into the 5G era. As this transformation takes place, our Board expects management to be proactive in considering our impacts on our key stakeholders – our shareholders, employees, customers and society – to shield against risk, unlock potential, produce a more engaged workforce and confer a competitive advantage in shareholder returns over the long term. It is incumbent on our Board to challenge Verizon to deliver on its strategy while living up to its corporate purpose. As such, it is critical that our Board has the right mix of skills, expertise, perspectives, experience and vision to oversee the execution of our strategy during this period of transformational change. We consider factors such as the importance of diversity, age, tenure and the size of the Board. Importantly, as we build our Board we seek to create a boardroom culture where difficult issues can be openly confronted, opposing opinions are valued and where there is trust. In 2021, we brought on two new Directors: Laxman Narasimhan, who has a track record in developing purpose-led brands, as well as extensive experience in consumer services and strategy, and Carol Tomé, who brings to the Board deep experience running a logistics-focused, capital intensive business through times of unprecedented demand, as well as extensive financial and risk management expertise. | As technology integral to our lives,
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Delivering on our corporate purpose and capitalizing on the opportunity ahead requires more than the best technology; it requires a strong V Team. A top priority for our Board is overseeing the company’s efforts to create a diverse, equitable and inclusive culture and develop a workforce with skills for the future. We believe investing in employees gives Verizon a powerful competitive edge. In addition to receiving regular briefings on employee engagement and workforce development initiatives, as a Board, we feel it is important to connect directly with employees. Our Directors participate in employee town halls, leadership forums and company-wide webcasts covering a range of topics from career development to current business and societal issues.
As a global community, we are facing some of the greatest challenges of our lifetime. Our Board is focused on steering the company through these challenges, supporting Verizon to engage on the societal issues that have a direct impact on our business, employees and the communities we serve, and continuing to build a resilient enterprise prepared to drive and power the interconnected future.
We believe we are laying the foundation for long-term success.
Sincerely,
Hans Vestberg Chairman and Chief Executive Officer | Clarence Otis, Jr. Independent Lead Director |
Verizon 2022 Proxy Statement
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proposals | Additional information |
This summary highlights information contained elsewhere in thisthe proxy statement. This summarystatement and does not contain all of the information you should consider, soconsider. We encourage you shouldto read the entire proxy statement before voting. For information regarding Verizon’s 20182021 performance, please reviewread Verizon’s 20182021 Annual Report to Shareholders.on Form 10-K.
Our purpose |
Adhering to our corporate purpose can produce more engaged employees and a better sense of how to serve our customers. It can also result in a broader social license to operate. This not only shields us against risk—it confers a competitive advantage in shareholder returns over the long term. – Clarence Otis, Jr., Independent Lead Director, 2021 annual shareholder outreach video, www.verizon.com/about/investors/corporate-governance |
Meeting information Date and time May 12, 2022 at 8:45 AM, local time Place Marriott Dallas Las Colinas, 223 West Las Colinas Boulevard, Irving, Texas Record date March 14, 2022 Admission and voting information can be found beginning on page 66. You will need to register in advance to attend the meeting in person. |
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Verizon 2022 Proxy Statement
Proxy | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Agenda and voting recommendations
Item 1: Election of Directors The Board of Directors recommends that you vote FOR the election of the Board’s nominees. | ||
The Board’s nominees are all proven leaders with a strong sense of integrity and respect for differing viewpoints. As a group they bring a mix of backgrounds, perspectives, skills, experiences and Environmental, Social and Governance (ESG) expertise that contributes to a well-rounded Board uniquely positioned to effectively oversee Verizon’s strategy and businesses. Additional information about the Director candidates and their respective qualifications begins on page 1. |
Our nominees’ skills and experience
10 | Consumer/B2B/retail | |
3 | Cybersecurity | |
9 | Financial expertise | |
3 | Marketing | |
4 | Regulatory/public policy | |
11 | Risk management | |
11 | Strategic planning | |
4 | Technology | |
3 | Telecommunications |
Board diversity*
Board tenure and age*
6.4
years
average
tenure
63
years old
average
age
* As of March 28, 2022. See Appendix A for the Board diversity disclosure required by Nasdaq Rule 5606.
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Verizon 2022 Proxy Statement
Proxy | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Our nominees at a glance
Committee membership*
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Name | Audit | Corporate Governance and Policy | Finance | Human Resources | Key skills and experience |
| Shellye Archambeau | |||||||||||||||
Former Chief Executive Officer,
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Marketing Risk management Technology | ||||||||||||||||
President and CEO, Austin Investment Advisors Independent | 🌑 | Cybersecurity | Financial Strategic planning | |||||||||||||
Co-Chief Executive Officer, Bridgewater Associates, LP
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🌑 | Financial expertise Regulatory/public policy Strategic planning |
Former Group President, The Procter & Gamble Company
| 🌑 | 🌑 | Consumer/B2B/retail Marketing Strategic planning | |||||||||||
Laxman Narasimhan Chief Executive Officer, Reckitt Benckiser Group Plc
| 🌑 | Consumer/B2B/retail Risk management Strategic planning | ||||||||||||
Clarence Otis, Jr. Former Chairman and CEO, Darden Restaurants, Inc.
| 🌑 | 🌑 | Consumer/B2B/retail Financial expertise Risk management | |||||||||||
Daniel Schulman President and CEO, PayPal Holdings, Inc.
| Cybersecurity Strategic planning Technology | |||||||||||||
Rodney Slater Partner, Squire Patton Boggs LLP Independent | 🌑 | 🌑 | Regulatory/public policy Risk management Strategic planning | |||||||||||
Carol Tomé Chief Executive Officer, United Parcel Service, Inc. Independent | 🌑 | Consumer/B2B/retail Financial expertise Strategic planning | ||||||||||||
Hans Vestberg Chairman and
Verizon Communications Inc. | Strategic planning Technology Telecommunications | |||||||||||||
Gregory Weaver Former Chairman and CEO, Deloitte & Touche LLP Independent | 🌑 | Financial expertise Risk management Strategic planning |
*Committee memberships are as of March 28, 2022. Committee Chair Audit Committee Financial Expert
Verizon 2019 Proxy Statement i
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Verizon 2022 Proxy Statement
Proxy | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Proxy SummaryGovernance highlights
Corporate Governance Highlights
Corporate Governance HighlightsOur Board has adopted robust governance structures and practices to enhance our independent oversight, effectiveness and accountability to shareholders.
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• Strong independent Lead Director with clearly delineated duties • Regular executive sessions of independent Directors | ||
Board effectiveness |
• Orientation program for new Directors and continuing education for all Directors • Limits on other public board service • Annual Board and committee assessments • Average tenure goal for independent Directors
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Accountability to shareholders |
• Shareholder right to call special meetings • Proxy access right with market terms • No poison pill, and shareholder • No dual-class shares or voting right restrictions • Robust stock ownership requirements for • Proactive year-round shareholder engagement program
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2021 |
• Elected two independent Directors, Mr. Laxman Narasimhan, CEO of Reckitt Benckiser Group Plc; and Ms. Carol Tomé, CEO of United Parcel Service, Inc. • Announced two approved science-based emissions reduction targets and reported Scope 3 emissions from our value chain • Published downloadable ESG data index with 3 years of metrics • Issued updated TCFD Report with a physical risk scenario analysis • Expanded workforce profile disclosures to include diversity by business unit and pay band • Issued a third US$1 billion green bond • Updated Green Financing Framework to include underwriter selection criteria related to diversity and U.N. Sustainable Development Goals • Launched Verizon
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Verizon 2022 Proxy Statement
| Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Item 2: Advisory vote to approve executive compensation
this proposal.
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iiVerizon 2019 Proxy Statement
Proxy Summary
Executive Compensation Program Highlights
Executive Compensation Program Highlightscompensation program highlights
Our executive compensation program reflects Verizon’s commitment to industry-leading compensation and governance practices. The program is discussed in detail in the Compensation Discussion and Analysis beginning on page 29.23.
Compensation strategy | ||||
• Align executives’ and shareholders’ interests • Attract, retain and motivate high-performing executives | ||||
Pay-for-performance essentials | • • Defined benefit pension and supplemental executive retirement benefits frozen over 15 years ago • | |||
Best practice highlights | • Shareholder approval policy for severance benefits • No cash severance benefits for the CEO
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• Significant executive share ownership requirements | ||||
• Clawback policies | ||||
• Anti-hedging policy | ||||
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2018 Compensation
The summary below shows the 20182021 compensation for each of our named executive officers, as required to be reported in the Summary Compensation table pursuant to U.S. Securities and Exchange Commission (SEC) rules. Please see the notes accompanying the Summary Compensation table beginning on page 5240 for more information.
Name and Principal Position | Salary $ | Bonus $ | Stock Awards $ | Option Awards $ | Non-Equity Incentive Plan Compensation $ | Change in Pension Value and Nonqualified Deferred Earnings $ | All Other Compensation $ | Total $ | ||||||||||||||||||||||||
Hans Vestberg* | 1,235,385 | 1,000,000 | 16,600,082 | 0 | 2,752,250 | 0 | 618,369 | 22,206,086 | ||||||||||||||||||||||||
Chairman and Chief Executive
Officer | ||||||||||||||||||||||||||||||||
Matthew Ellis | 792,307 | 0 | 4,800,020 | 0 | 1,308,000 | 0 | 160,349 | 7,060,676 | ||||||||||||||||||||||||
Executive Vice President
and Chief Financial Officer | ||||||||||||||||||||||||||||||||
K. Guru Gowrappan** | 603,448 | 1,999,998 | 8,695,827 | 0 | 1,020,000 | 0 | 433,665 | 12,752,938 | ||||||||||||||||||||||||
Executive Vice President and CEO – Verizon Media Group
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Marc Reed | 821,154 | 0 | 4,950,064 | 0 | 1,348,875 | 0 | 232,377 | 7,352,470 | ||||||||||||||||||||||||
Executive Vice President and
Chief Administrative Officer | ||||||||||||||||||||||||||||||||
Ronan Dunne | 846,154 | 0 | 4,250,008 | 0 | 1,389,750 | 0 | 228,214 | 6,714,126 | ||||||||||||||||||||||||
Executive Vice President and
President – Verizon Consumer Group | ||||||||||||||||||||||||||||||||
Lowell McAdam* | 1,661,538 | 0 | 12,000,050 | 0 | 4,360,000 | 0 | 616,279 | 18,637,867 | ||||||||||||||||||||||||
Former Chairman and Chief
Executive Officer | ||||||||||||||||||||||||||||||||
John Stratton*** | 1,260,962 | 0 | 6,600,052 | 0 | 1,798,500 | 0 | 5,987,338 | 15,646,852 | ||||||||||||||||||||||||
Former Executive Vice President and President – Global Operations
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Timothy Armstrong** | 1,193,750 | 0 | 3,150,081 | 0 | 1,680,000 | 0 | 6,465,111 | 12,488,942 | ||||||||||||||||||||||||
Former Executive Vice President and President and CEO – Oath
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Name and principal position | Salary ($) | Bonus ($) | Stock awards ($) | Option awards ($) | Non-equity incentive plan compensation ($) | Change in pension value and nonqualified deferred compensation earnings ($) | All other compensation ($) | Total ($) | ||||||||||||||||||||||||
Hans Vestberg Chairman and Chief Executive Officer | 1,500,000 | 0 | 14,500,057 | 0 | 3,825,000 | 0 | 517,814 | 20,342,871 | ||||||||||||||||||||||||
Matthew Ellis Executive Vice President and Chief Financial Officer | 950,000 | 0 | 6,525,007 | 0 | 1,453,500 | 0 | 183,382 | 9,111,889 | ||||||||||||||||||||||||
Ronan Dunne* Executive Vice President and Group CEO – Verizon Consumer | 1,050,000 | 0 | 8,000,073 | 0 | 1,496,250 | 0 | 245,727 | 10,792,050 | ||||||||||||||||||||||||
Tami Erwin Executive Vice President and Group CEO – Verizon Business | 950,000 | 0 | 6,525,007 | 0 | 1,184,942 | 0 | 208,530 | 8,868,479 | ||||||||||||||||||||||||
Kyle Malady** Executive Vice President | 850,000 | 0 | 5,250,065 | 0 | 1,402,500 | 166 | 171,971 | 7,674,702 | ||||||||||||||||||||||||
K. Guru Gowrappan*** Former Executive Vice President and Group CEO – Verizon Media | 588,462 | 3,000,000 | 6,250,033 | 0 | 0 | 0 | 125,947 | 9,964,442 |
* | Mr. |
** | Mr. |
*** | Mr. |
Verizon 2019 Proxy Statement iiiv
Verizon 2022 Proxy Summary
Board Diversity and Experience
The Verizon Board embodies a range of viewpoints, backgrounds and expertise because we believethat diversity is a critical element of a well-functioning board.
Board Diversity and Experience*
Current/Former CEO Public Board Service Accounting/Finance Risk Management Strategic Planning Operational Technology/IT/Telecoms Consumer/Customer Experience Women Hispanic/African American
Board Tenure*
Statement
| Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Average Tenure: 7.7 years Median Tenure: 6.8 years Average Age* 62 1 50-55 years 3 56-60 years 5 61-65 years 3 66-72 years
ivVerizon 2019 Proxy Statement
Proxy Summary
Agenda and Voting Recommendations
Agenda and Voting Recommendations
Item
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The Board of Directors recommends that you voteFOR ratification.
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Committee Membership* | ||||||||||||||||||||||
Name | Age* | Director Since | Primary Occupation | Independent | Audit | Corporate Governance and Policy | Finance | Human Resources | ||||||||||||||
Shellye L. Archambeau | 56 | 2013 |
Former Chief Executive Officer, MetricStream, Inc. | |||||||||||||||||||
Mark T. Bertolini | 62 | 2015 | Former Chairman and Chief Executive Officer, Aetna Inc. | |||||||||||||||||||
Vittorio Colao | 57 | — | Former Chief Executive, Vodafone Group Plc | |||||||||||||||||||
Melanie L. Healey | 57 | 2011 | Former Group President of The Procter & Gamble Company | |||||||||||||||||||
Clarence Otis, Jr. Lead Director | 62 | 2006 | Former Chairman and Chief Executive Officer, Darden Restaurants, Inc. | |||||||||||||||||||
Daniel H. Schulman | 61 | 2018 | President and Chief Executive Officer, PayPal Holdings, Inc. | |||||||||||||||||||
Rodney E. Slater | 64 | 2010 | Partner, Squire Patton Boggs LLP | |||||||||||||||||||
Kathryn A. Tesija | 56 | 2012 | Former Executive Vice President and Chief Merchandising and Supply Chain Officer, Target Corporation | |||||||||||||||||||
Hans Vestberg Chairman | 53 | 2018 | Chairman and Chief Executive Officer, Verizon Communications Inc. | |||||||||||||||||||
Gregory G. Weaver | 67 | 2015 | Former Chairman and Chief Executive Officer, Deloitte & Touche LLP |
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Verizon 2019 Proxy Statement v
Proxy Summary
Agenda and Voting Recommendations
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We are asking shareholders to ratify the Audit Committee’s appointment of Ernst & Young LLP as Verizon’s independent registered public accounting firm for |
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The Board of Directors recommends that you vote
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In accordance with SEC rules, we have included in this proxy statement proposals submitted by shareholders for consideration. The proposals can be found beginning on page 58. |
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Verizon 2022 Proxy Statement
We are mailing this proxy statement to our shareholders beginning on March 18, 2019. It is also available online atwww.edocumentview.com/vz or, if you are a registered holder, atwww.envisionreports.com/vz. Our Board of Directors is soliciting proxies in connection with the 2019 Annual Meeting of Shareholders and encourages you to read this proxy statement and vote your shares promptly.
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Our approach to Board and Principles of Good Governancecomposition
We believe that good governance starts with an independent, effective and diverse Board leadership.Board. Our Board is one of Verizon’s most critical strategic assets. As such, the composition of the Board evolves along with our strategic needs for the future. We believe we are more likely to achieve sustainable growth in shareholder value when our Board has the right mix of skills, expertise and tenure. In carrying out its responsibilities, the Board abides by certain guiding principles with regard to its own composition and most essential duties – principles our shareholders have expressed to us that they believe are fundamental to our Company’s success.
Diversity. A board with a diverse set of viewpoints, backgrounds and expertise is best positioned to provide broad perspectives to our management team as it assesses the challenges and opportunities impacting our business. A diverse board is more likely to consider a broader range of possibilities and help management achieve better outcomes. Diversity is one critical element of board composition that Verizon has focused on over the years in our refreshment and succession planning processes, as well as in our Board leadership structure. Women compriseone-third of our current Board.
Strategy and risk oversight. We recognize that our shareholders rely on our Directors to oversee Verizon’s strategy for realizing opportunities and mitigating risks. As management navigates a rapidly changing competitive landscape, it is the Board’s duty to ensure that management is executing on the Company’s strategic plan, addressing emerging challenges and disruptions, and promoting innovation. At the same time, Directors must satisfy themselves that the risk management policies and procedures designed and implemented by management are consistent with the Company’s strategy and risk appetite, that these policies and procedures are functioning as intended, and that necessary steps are taken to create a culture of risk-aware decision making throughout the organization. Through its oversight role, the Board sends a message to management that risk management is not an impediment to the conduct of business, but is instead an integral component of strategy, culture and business operations.
Engagement.Our Board welcomes the opportunity to develop an understanding of shareholder perspectives on our Company and to foster long-term relationships with our shareholders. Our Directors understand that our investors want to hear from them on their thinking on a range of topics not just limited to the shareholder proposals we receive during proxy season. In 2018, our Board discussed with shareholders long-term strategy oversight, CEO succession, sustainability and corporate responsibility, Board composition and refreshment, the relationship between our compensation program and our long-term strategy, and transparency into Board practices and priorities.
Verizon 2019 Proxy Statement 1
Governance
Governance Framework
The Board conducts its oversight responsibilities through four standing committees: Audit, Corporate Governance and Policy, Finance, and Human Resources. Each committee has a written charter that defines its specific responsibilities. The committees are discussed beginning on page 16.
The Corporate Governance and Policy Committee ensuresis strategic and purposeful in its approach to refreshment and succession planning. Key factors the Committee considers when nominating Directors include:
Skills and experience – Verizon’s strategy is to extend our network leadership through continued innovation, grow our core business and provide our customers with best-in-class experiences, while maintaining the balanced capital allocation approach and financial discipline that our investors expect of us. In light of the membership, structure, policiesCompany’s strategy and practicesexpected future business needs, the Committee has identified the skills and experience in the table below as important to be represented on the Board as a whole.
• Consumer/B2B/retail • Cybersecurity • Financial expertise | • Marketing • Regulatory/public policy • Risk management | • Strategic planning • Technology • Telecommunications |
Diversity – The Committee recognizes that a diverse set of viewpoints and practical experiences enhances the effectiveness of our Board in assessing the challenges and its committees promoteopportunities impacting our business and helping management achieve better outcomes. In evaluating candidates, the effective exerciseCommittee considers how a candidate’s particular background, experience, qualifications, attributes and skills may complement, supplement or duplicate those of other prospective candidates. The Committee seeks a diverse group of candidates who possess the requisite judgment, background, skill, expertise and time, as well as diversity with respect to race, ethnicity and gender, to strengthen and increase the diversity, breadth of skills and qualifications of the Board’s role inBoard. See Appendix A for the governanceBoard diversity disclosure required by Nasdaq Rule 5606.
Age and tenure – The Committee believes it is important to bring new perspective and talents to the Board on a regular basis. Verizon does not have term limits for Directors because the Board recognizes that Directors who have served on the Board for an extended period can provide valuable insight into Verizon’s operations and future based on their experience with, and understanding of, Verizon.Verizon’s history, policies and objectives. As an alternative to term limits, the Board seeks to maintain an average tenure of nine years or less for its independent Directors. In addition, ourto encourage new viewpoints on the Board, the Board seeks to add at least one new Director every two years on average. Under the Corporate Governance Guidelines, provide a framework forDirector must retire from the Board the day before the annual meeting of shareholders that follows his or her 72nd birthday.
Board size – The Committee periodically evaluates whether to change the size of the Board based on the Board’s operationsneeds and address key governance practices.the availability of qualified candidates.
Board dynamics – The Corporate Governance and Policy Committee monitors best practices and developments in corporate governance, considers the views of Verizon’s shareholders, and periodically recommends changeseach Director candidate’s individual contribution or potential contribution to the Board’s policiesBoard as a whole and practices, including the Guidelines.strives to maintain one hundred percent active and collaborative participation.
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Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
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Based on the Committee’s recommendation, the Board has determined that all of the non-employee Director candidates meet the independence requirements of applicable law, the NYSE, Nasdaq and Verizon’s Corporate Governance Guidelines: Ms. Archambeau, Ms. Austin, Mr. Bertolini, Ms. Healey, Mr. Narasimhan, Mr. Otis, Mr. Schulman, Mr. Slater, Ms. Tomé and Mr. Weaver. The Board also determined that Mr. Vittorio Colao, who served as a Director until February 13, 2021, was independent. Additionally, the Board has determined that each member of the Audit Committee and the Human Resources Committee meets the additional, heightened independence criteria applicable to such committee members under the applicable NYSE and Nasdaq rules. The employers of Mr. Bertolini, Mr. Narasimhan, Mr. Schulman and Ms. Tomé each made payments to Verizon for telecommunications services during 2021. In addition, during 2021 Verizon made payments to Mr. Bertolini’s employer for fees relating to investment of pension plan assets, to Mr. Schulman’s employer for processing fees relating to payments to and from our customers in connection with Verizon services and wireless devices, and to Ms. Tomé’s employer for shipping services. Applying the independence standards above, the Board considered the foregoing payments and determined that these The Corporate Governance and Policy Committee considers and recommends candidates for our Board. The Committee reviews all nominations submitted to Verizon, including individuals recommended by shareholders, Directors or members of management. The Committee also retains executive search firms from time to time to help identify and evaluate potential candidates. Any shareholder who wishes to recommend a Director candidate to the Committee for its consideration should write to the Assistant Corporate Secretary at the address given under “Contacting A recommendation for a Director candidate should include the candidate’s name, biographical data and a description of the candidate’s qualifications in light of the requirements described below. If we make any material changes to the Committee’s procedure for considering and nominating candidates, we will file a report with the SEC and post the information on the Corporate Governance section of our website at www.verizon.com/about/investors/corporate-governance. |
We are committed to operating with the highest level of integrity, responsibility and accountability. To that end, we have adopted a Code of Conduct that applies to all employees, including the CEO, the Chief Financial Officer and the Controller. The Code of Conduct describes each employee’s responsibility to conduct business with the highest ethical standards and provides guidance about preventing, reporting and remediating potential compliance violations in key areas. Directors are expected to act in the spirit of the Code of Conduct, and to comply with the specific ethical provisions of the Corporate Governance Guidelines. Our Board is strongly predisposed not to waive any of these business conduct and ethics provisions for executive officers or Directors. In the unlikely event of a waiver, we will promptly disclose the Board’s action on our website.
The Board has adopted the Related Person Transaction Policy that is included in the Guidelines. The Corporate Governance and Policy Committee reviews transactions between Verizon and any of our Directors or executive officers or members of their immediate families to determine if any participants have a material interest in the transaction. If the Committee determines that a material interest exists, based on the facts and circumstances of each case, the Committee may approve, disapprove, ratify or cancel the transaction or recommend another course of action. Any Committee members who are involved in a transaction under review do not participate in the Committee’s deliberations.
From time to time Verizon has employees who are related to our executive officers or Directors. Mr. McAdam, who served as CEO until August 1, 2018 and as Executive Chairman from that time until December 31, 2018, has a child who is employed by a Verizon subsidiary and earned approximately $144,000 in 2018. Mr. Stratton, who served as Executive Vice President and President – Global Operations until June 7, 2018 and as Executive Vice President from that time until December 31, 2018, has a child who is employed by a Verizon subsidiary and earned approximately $245,000 in 2018, and anin-law who is employed by a Verizon subsidiary and earned approximately $209,000 in 2018. In each case, the amount of compensation earned was comparable to that of other employees in similar positions. These employees also participate in Verizon’s welfare and benefit plans that are made available to all employees.
2Verizon 2019 Proxy Statement
Governance
Corporate Responsibility and Board Oversight
| What ESG skills and
• business ethics and compliance; • corporate • cybersecurity, data security and privacy; • diversity, equity and inclusion; • environmental sustainability, • governance; • network reliability and • regulatory and
• talent development. |
Diversity and Inclusion
At Verizon, we understand that our success as a company is grounded in a respect for and encouragement of diverse viewpoints. In order to connect people across the world, we know we need to tap into the diversity of thoughts, capabilities, background and cultures among our team members, suppliers and customers. We are committed to diversity and equality in all areas of our business, including hiring and compensation. Since Verizon was founded, ourHuman Resources Committee has included adiversity target as one of theperformance measures for employees’ short-term incentive awards. As a company, we believe in pay equity. Toward that end, we have adopted aPay Equity Commitment that can be found on our website atwww.verizon.com/about/our-company/company-policies. As part of this commitment, Verizon pledges to identify and promote best practices in compensation, hiring, promotion and career development; to develop strategies to reduce unconscious bias; and to make hiring, promotion and compensation decisions that promote pay equity.
Verizon 2019 Proxy Statement 32
Governance
Corporate Responsibility and Board OversightVerizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Human Rights
Support for universal human rights has long been and will continue to be a core value and a significant part of the way in which Verizon conducts business. In 2009, Verizon committed to respecting human rights as defined in foundational instruments such as the Universal Declaration of Human Rights. Our commitments to human rights are formally expressed in ourCredo, ourCode of Conduct, ourHuman Rights Policyand our Supplier Code of Conduct. Verizon strives to create an environment of respect, integrity and fairness for our employees and customers wherever we do business, and we expect our business partners to operate the same way. Verizon’s Human Rights Policy is consistent with the spirit and intent of widely recognized international human rights principles, including those enshrined in the Universal Declaration of Human Rights. Our Supplier Code of Conduct mandates that our partners and suppliers, both locally and globally, conduct their operations not only in compliance with applicable laws but in an ethically responsible manner. Verizon’s Board of Directors oversees our policies relating to human rights as well as ethical issues with regard to our suppliers.
In order to support our efforts to operate in accordance with these standards, Verizon has launched a Business & Human Rights Program. This Program, which is based on an initiative created ten years ago at Yahoo prior to our acquisition of that company, strives to systematically embed human rights considerations into responsible business decision-making processes across the company. Critically, this work is informed by engagement with external networks and experts from around the globe.
Environmental
At every level of Verizon — from the way we operate our business to how we develop our products and services to how we pay our employees — we work to minimize our environmental impact. We measure our progress bytracking our carbon intensity — the amount of carbon our business emits divided by the terabytes of data we transport over our networks. Our current goal is to reduce our carbon intensity by 50% over the 2016 baseline by 2025, even as we grow our business. We intend to accomplish this through network upgrades and investing in renewable sources of energy. We now generate over 22 megawatts ofgreen energy in the United States every year, and our goal is to implement an additional 24 MW of green energy aton-site locations by 2025. We are working towards sourcing renewable energy equivalent to 50% of our total electricity usage by 2025. Verizon is one of the few companies in our peer group that includes asustainability target as one of the performance measures for management employees’ short-term incentive compensation awards. TheHuman Resources Committee has used a sustainability metric for compensation purposes since 2014.
4Verizon 2019 Proxy Statement
Verizon’s Directors are elected annually for a term of one year. We believe annual elections are consistent with good corporate governance because they foster director accountability and increase shareholder confidence. Verizon’s bylaws require Directors to be elected by a majority of the votes cast in an uncontested election.
The Corporate Governance and Policy Committee considers and recommends candidates for our Board. The Committee reviews all nominations submitted to Verizon, including individuals recommended by shareholders, Directors or members of management. The Committee also retains executive search firms from time to time to help identify and evaluate potential candidates.
Any shareholder who wishes to recommend a Director candidate to the Committee for its consideration should write to the Assistant Corporate Secretary at the address given under “Contacting Verizon.” A recommendation for a Director candidate should include the candidate’s name, biographical data and a description of the candidate’s qualifications in light of the requirements described below. If we make any material changes to the Committee’s procedure for considering and nominating candidates, we will file a report with the SEC and post the information on the Corporate Governance section of our website atwww.verizon.com/about/investors.
The Committee specifically reviews the qualifications of each candidate for election orre-election. For incumbent Directors, this review includes the Director’s understandingparticipation in and contributions to the activities of Verizon’s businessesthe Board, the Director’s independence and the environment within which Verizon operates,past meeting attendance and participation at meetings,whether the Director’s skills and independence.expertise continue to align with Verizon’s long-term business strategy. After the Committee evaluates all candidates for Director, it presents its recommendation to the Board. The Committee also discusses with the Board any candidates who were considered by the Committee but not recommended for election orre-election.
Before they are nominated, each candidate for election and each incumbent Director standing forre-election must consent to stand for election orre-election and provide certain representations required under Verizon’s bylaws. Each candidate who is standing for election must also submit an irrevocable resignation, which will only become effective if (i) our Board or any Committee determines that any of the required representations were untrue in any material respect or that the candidate breached any obligation under Verizon’s bylaws or (ii) the candidate does not receive a majority of the votes cast at the annual meeting of shareholders and the independent members of our Board decide to accept the resignation. Any decision about a resignation following an incumbent Director’s failure to obtain a majority of the votes cast will be disclosed within 90 days after the election results are certified.
Shareholders wishing to nominate a Director should follow the procedures set forth in Verizon’s bylaws and summarized beginning on page 87.69.
Director Criteria, Qualificationscriteria, qualifications and Experienceexperience
To be eligible for consideration, any proposed candidate must:
Be ethicalPossess exemplary ethics and integrity
Have proven judgment and competence
Have professional skills and experience in dealingthat align with a large, multi-faceted organization or in dealing with complex problems thatthe needs of Verizon’s long-term business strategy and complement the background and experience already represented on ourthe Board and that meet Verizon’s needs
Verizon 2019 Proxy Statement 5
Item 1: Election of Directors
Director Criteria, Qualifications and Experience
Have demonstrated the ability to act independently and be willing to represent the long-term interests of all shareholders and not just those of a particular philosophyconstituency or constituencyperspective
Be willing and able to devote sufficient time to fulfill responsibilities to Verizon and our shareholders
Our Board’s commitment to refreshment and succession planning is at the core of its ability to maintain independence of thought and action. Key factors the Committee considers when nominating Directors and refreshing the Board include:
Diversity – The Committee recognizes that a diverse set of viewpoints and practical experiences enhances the effectiveness of our Board. In evaluating candidates, the Committee considers how a candidate’s particular background, experience, qualifications, attributes and skills may complement, supplement or duplicate those of other prospective candidates.
Experience – The Committee strives to maintain a Board with a wide range of leadership experience and skills relevant to Verizon’s strategic vision.
Age and tenure – Under the Corporate Governance Guidelines, a Director must retire from the Board the day before the annual meeting of shareholders that follows his or her 72nd birthday. The Committee also considers the tenure of each incumbent Director and the average tenure of the Board in an effort to maintain a Board that balances the fresh perspective and ideas of newer Directors with the deep insight into the Company that longer tenured Directors have developed.
Board size – The Committee periodically evaluates whether to change the size of the Board based on the Board’s needs and the availability of qualified candidates.
Board dynamics – The Committee considers each Director candidate’s individual contribution or potential contribution to the Board as a whole and strives to maintain one hundred percent active and collaborative participation.
Board Diversity and Experience*
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9 Current / Former CEO 11 Operational 11 Strategic Planning 5 Hispanic / African American 6 Risk Management 4 Women 5 Accounting / Finance 8 Consumer / Customer Experience 12 Public Board Service 4 Technology / IT / Telecoms
6Verizon 2019 Proxy Statement
Item 1: Election of Directors
Independence
Board Tenure*
Average Tenure: 7.7 years Median Tenure: 6.8 years Average Age* 62 1 50-55 years 3 56-60 years 5 61-65 years 3 66-72 years
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Verizon’s Corporate Governance Guidelines establish standardsDirectors are elected annually for evaluating Director independencea term of one year. We believe annual elections are consistent with good corporate governance because they foster director accountability and increase shareholder confidence. Verizon’s bylaws require thatDirectors to be elected by a substantial majority of the Directors be independent. The Board determines the independence of each Director under NYSE and Nasdaq governance standards, as well as the more stringent standards includedvotes cast in the Guidelines. These standards identify the types of relationships that, if material, could impair independence, and fix monetary thresholds at which the relationships are considered to be material. The Guidelines are available on the Corporate Governance section of our website atwww.verizon.com/about/investors. The Corporate Governance and Policy Committee conducts an annual review of any relevant business relationships that each Director may have with Verizon and reports its findings to the full Board. Based on the Committee’s recommendation, the Board has determined that all of thenon-employee Director candidates are independent: Ms. Archambeau, Mr. Bertolini, Mr. Colao, Ms. Healey, Mr. Otis, Mr. Schulman, Mr. Slater, Ms. Tesija and Mr. Weaver. The Board also determined that Mr. Carrión and Ms. Keeth, who are not standing for re-election, Dr. Kley, who served as a Director until May 3, 2018, and Mr. Wasson, who served as a Director until October 1, 2018, were independent.
The employers or former employers of Mr. Bertolini, Mr. Schulman and Mr. Slater all made payments to Verizon for telecommunications services and solutions during 2018. In addition, Verizon made payments to Mr. Schulman’s employer for processing fees relating to payments to and from our customers in connection with Verizon Wireless services and devices, and to Mr. Bertolini’s former employer under an administrative services contract for employee healthcare benefits. Applying the independence standards above, the Board considered the foregoing payments and determined that these general business transactions and relationships are not material and did not impair the ability of the applicable Directors to act independently.
Verizon 2019 Proxy Statement 7
Item 1: Election of Directors
Nominees for Election
uncontested election.
Our Board has nominated the 1011 candidates below for election as Directors. Except forDirectors, all of whom currently serve as Directors of Verizon. In June 2021, the Board elected Mr. Colao, whoNarasimhan as an independent Director, effective July 1, 2021; he was recommended by an executive search firm retained by the Corporate Governance and Policy Committee. In August 2021, the Board elected Ms. Tomé as an independent Director, effective September 1, 2021; she was known to the Company as a result of his tenureher prior service on the Verizon Wireless Board of Representatives, all of the candidates currently serve as Directors of Verizon. Mr. Schulman was appointed to the Board in September 2018 as an independent Director and was identified by an executive search firm retained by the Company. After completing the evaluation process described above, the Corporate Governance and Policy Committee and our Board concluded that these candidates should be nominated for election orre-election, as the case may be. We describe their respective experience, qualifications, attributes and skills below. The Committee and the Board assessed these factors in light of Verizon’s strategy and businesses, which provide a broad array of communications, information and entertainment products and services to individuals, businesses, governments and wholesale customers in the United States and around the world.2020.
Each candidate has consented to stand for election, and we do not anticipate that any candidate will be unavailable to serve. If any candidate were to become unavailable before the election, the proxy committee could vote the shares it represents for a substitute named by the Board.
Each candidate has submitted an irrevocable, conditional letter of resignation that our Board will consider if that candidate fails to receive a majority of the votes cast.
Biographical information for each Director nominee follows. We have included career highlights and the key skills and experience that we believe each Director nominee brings to our Board, as well as their other public board directorships. All of our nominees bring more qualifications to the Board than those highlighted in their biographies, and these are reflected in the aggregate Board composition statistics provided in the Proxy Summary. When deciding to re-nominate these Directors, the Corporate Governance and Policy Committee and the Board considered each Director’s individual qualifications, as well as the aggregate of skills and experience represented on the Board, in light of the Company’s strategy and expected future business needs.
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The Board of Directors recommends that you voteFOR the election of
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8Verizon 2019 Proxy Statement3
Item 1: Election of Directors
Nominees for Election
Verizon 2022 Proxy Statement
summary | Governance | Executive compensation | matters | Stock ownership | Shareholder proposals | Additional information |
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Age: 59 Committees: Audit Corporate Governance and Policy (Chair) | Independent Director since: 2020 Age: 61 Committees: Audit Finance |
Key skills and experience: • • Marketing: Served as Chief • Risk management: Acquired significant expertise with integrated enterprise risk management, regulatory compliance functions and quality, vendor and audit management software solutions across a wide array of industries during her tenure at MetricStream, as well as through service on the audit committees of Verizon, Okta and Arbitron. • Technology: Gained valuable experience developing and marketing emerging technology applications and solutions, including internet infrastructure, cloud-based and identity security services, business software platforms, e-commerce and digital media. Career highlights: • MetricStream Inc., a leading provider of governance, risk, compliance and quality management ¡ Chief Executive Officer (2002-2018) • Executive Positions at Loudcloud, Inc., NorthPoint Communications, Blockbuster Inc. and IBM (domestic and international) (1984-2002) Other public company boards: Nordstrom, Inc. (since 2015) Okta, Inc. (since 2018) Roper Technologies, Inc. (since 2018) | Key skills and experience: • Leadership: Seasoned leader who served as • Cybersecurity: Acquired significant cybersecurity experience through her extensive management and • Financial expertise: Developed a comprehensive background in finance and
Career highlights: • President and Chief Executive Officer of Austin Investment Advisors, a private investment and consulting firm (2003-present) • President and Chief Executive Officer of Move Networks, Inc., an IP-based television delivery service (2009-2010) • President and Chief Operating Officer of DIRECTV, Inc., a digital television entertainment service (2001-2003) • Chief Financial Officer and Various Executive Positions at Hughes Electronics Corporation (1993-2001) • Audit Partner and Various Audit Positions at Deloitte & Touche LLP (1983-1993) Other
Abbott Laboratories Inc. (since 2000)*
Freshworks Inc. (since September 2021) Teledyne Technologies Target Corporation (2002-2020) Ericsson (2008-2016) * Ms. Austin will not stand for re-election to the Abbott Laboratories Board of Directors at the end of her current term expiring at the April 29, 2022 annual shareholders meeting. |
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Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Mark Bertolini
| Melanie Healey | |||||||||
Age: 65 Committees: Finance (Chair) Human Resources | Independent Director since: 2011 Age: 60 Committees: Corporate Governance and Policy Human Resources | |||||||||
Key skills and experience: • • Financial expertise: Developed deep financial and risk management expertise in his executive roles at Aetna and as a Board member of MassMutual Life Insurance Company, a leading life insurance mutual company. Following his service on the • Regulatory/public policy: A national health care thought leader with extensive regulatory and public policy experience. Successfully navigated changes in the health insurance marketplace resulting from the Affordable Care Act and led Aetna through antitrust reviews of various acquisitions and proposed acquisitions. • Strategic planning: Led Aetna through a period of strategic and regulatory transformation and domestic and international growth through strategic acquisitions and dispositions, culminating in the $78 billion acquisition of Aetna by CVS completed in 2018. Career highlights: • Co-Chief Executive Officer of Bridgewater Associates, LP, a global investment management firm (January 2022-present) • Aetna Inc., a multi-national, Fortune 100 diversified healthcare benefits ¡ Chairman ¡ Chief Executive Officer (2010-2018) ¡ President ¡ Other Executive • Executive Positions at Cigna, NYLCare Health Plans and SelectCare, Inc.
CVS Health Corporation (2018-2020) | Key skills and experience: • Leadership: Accomplished, consumer-focused executive with substantial global experience and a track record of delivering growth, driving operational improvements and launching successful product innovations over a 33-year career at 3 global iconic consumer product brand companies, including leading a global business for 6 years. • Consumer/B2B/retail: Gained deep and valuable branding, distribution and operating experience with consumer wellness products on a global scale over a long career at 3 different multi-national organizations in the consumer goods industry (Procter & Gamble, Johnson & Johnson and S.C. Johnson & Sons). Continues to focus on the consumer/retailing sector through service on the Target board of directors and on a globally recognized consumer and B2B brand through service on the board of Hilton, which has over 6,000 properties in over 100 countries and territories. • Marketing: Brings a multi-cultural and multi-national perspective acquired from working 18 years internationally to corporate strategy with respect to brand building, new product and commercial innovation and the consumer experience, as well as experience with managing large and complex marketing budgets. • Strategic planning: As Group President of North America at Procter & Gamble, oversaw multi-year strategic planning for the largest division of the company, with over $32 billion in annual sales, and reversed a decline in sales after assuming that role. Career highlights: • The Procter & Gamble Company, a leading provider of branded consumer packaged goods ¡ Group President (2007-2015) ¡ Other Executive Positions (1990-2015) • Johnson & Johnson (1986-1990) • S.C. Johnson & Sons (1983-1986) Other public company boards: Hilton Worldwide Holdings Inc. (since 2017) PPG Industries, Inc. (since 2016) Target Corporation (since 2015) |
Verizon 2019 Proxy Statement 95
Item 1: Election of Directors
Nominees for Election
Verizon 2022 Proxy Statement
Proxy summary |
| Executive compensation | Audit matters |
| Shareholder proposals | Additional information |
| Clarence Otis, Jr. (Lead Director) | |||||||||
Independent Director since:
Age:
Committees: Audit Corporate Governance and Policy |
Independent Director since: 2006
Audit Finance Human Resources | |||||||||
Key skills and experience: • Leadership: Insightful and strategic leader with • Consumer/B2B/retail: Provides valuable experience
• Risk management: Developed significant risk management experience, including supply chain risk management experience, while piloting Reckitt Benckiser through the supply chain disruptions of the
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10Verizon 2019 Proxy Statement
Item 1: Election of Directors
Nominees for Election
• Strategic planning: Articulated corporate purpose and drove strategic change while transitioning into the leadership role at Reckitt Benckiser during the COVID-19 pandemic. Eliminated complexity and simplified operations in order to remain agile and manage surging demand for certain consumer products during the pandemic.
• Chief Executive Officer of Reckitt Benckiser Group Plc, a global consumer-goods company (2019-present) • PepsiCo, Inc., a leading global food and beverage company ¡ Global Chief Commercial Officer (2019) ¡ Chief Executive Officer, Latin America, Europe and Sub-Saharan Africa (2017-2019) ¡ Other Executive Positions (2012-2017) • McKinsey & Company (1993-2012) Other public company boards: Reckitt Benckiser Group Plc (since 2019) | ||||||||
• Consumer/B2B/retail: Brings deep and valuable insights into consumer services and retail operations gleaned from • Financial expertise: Gained substantial financial expertise through, among other roles, investment banking positions of • Risk management: Acquired significant expertise with financial risk assessment and enterprise risk management during his career in investment banking and at Darden, as well as through his many years of service on the Federal Reserve Bank of Atlanta Board, the Audit Committees of VF Corporation and Verizon, the Investment & Capital Markets Committee of Travelers and as a
• Darden Restaurants,
¡ Chief Executive Officer (2004-2014) ¡ Other Executive Positions (1995-2014) • Director of
• Investment banker and lawyer specializing in securities and finance Other The Travelers Companies, Inc. (since 2017) VF Corporation (since 2004) MFS Mutual Funds complex (since 2017) |
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Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Daniel Schulman
| Rodney Slater | |||||||||
Independent Director since: 2018
Age:
Committees: Human Resources (Chair) | Independent Director since: 2010
Committees: Corporate Governance and Policy Human Resources | |||||||||
Key skills and experience: • • Cybersecurity: Gained extensive cybersecurity and risk management experience as a director of Symantec Corporation, a global leader in cybersecurity, for nearly 20 years, including serving as the independent chairman for 6 years. • Strategic planning: Spearheaded innovation and growth at start-ups and established companies, including Priceline, where he grew annual revenues from $20 million to nearly $1 billion over two years, Virgin Mobile USA, where he successfully built a pre-paid cellphone business, American Express, where he expanded global mobile and online payment services, and PayPal, where he has achieved significant revenue growth and stock price appreciation. • Technology: Acquired significant expertise in mobile technology and digital innovation over a long career spanning the telecommunications, financial technology and e-commerce industries. Career highlights: • PayPal Holdings, Inc., a leading online payments ¡ President and ¡ President andCEO-Designee • Group President of the Enterprise Group at American Express Company • President of the Prepaid Group at Sprint Nextel Corporation • Founding CEO of Virgin Mobile USA, Inc. • President and CEO of Priceline Group, Inc. • Various Executive Positions, including President of the Consumer Markets
PayPal Holdings, Inc. (since 2015) Symantec Corporation (2000-2019) FLEX LTD. (2009-2018) | Key skills and experience:
• Leadership: Nationally recognized for innovative infrastructure development and forging strategic public and private partnerships. As U.S. Secretary of Transportation, oversaw national transportation policy, spearheaded several historic legislative measures, including record funding for surface transportation investment and aviation safety and security, promoted intermodal transportation systems and led effort to significantly expand high speed rail network. • Regulatory/public policy: Brings a strategic, collaborative and result-oriented approach to oversight of regulatory and public policy issues developed over his long and accomplished career in both the public and private sectors. • Risk management: Globally recognized advisor for reputational risk management, corporate compliance and emergency preparedness, having served as an independent monitor/advisor for Toyota, Takata and Fiat Chrysler as these companies worked through safety issues, and coordinated the Federal Highway Administration’s response to several major natural disasters. • Strategic planning: Implemented a visionary strategic plan for the U.S. Department of Transportation to expand its focus on safety, mobility and access, economic development and trade, the environment and national security. Developed an innovative financing and contracting program at the Federal Highway Administration that produced significant operational and cost efficiencies. Career highlights: • Partner, Squire Patton Boggs LLP, a law firm (2001 to present) • U.S. Secretary of Transportation (1997-2001) • Administrator, Federal Highway Administration (1993-1997) • Various policy positions with the State of Arkansas Other public company boards: EVgo Inc. (since July 2021) Stagwell Inc. (since August 2021) Kansas City Southern (2001-2019) Transurban Group (2009-2018) |
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Item 1: Election of Directors
Nominees for ElectionVerizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Carol Tomé | Hans Vestberg (Chairman) | |||||||||
Independent Director since: 2021 Age: 65 Committees: Finance | Director since: 2018 Age: 56 | |||||||||
Key skills and experience: • Leadership: After being appointed CEO of UPS in June 2020, led the company through an unprecedented surge in demand for services, while improving competitiveness and reducing bureaucracy. Demonstrated strong financial leadership as CFO for over 18 years at Home Depot, with responsibility for all corporate finance matters including financial reporting, financial planning and analysis, financial operations, internal audit, investor relations and tax. Led strategic business development during a critical time for Home Depot, as well as the IT and security function. • Consumer/B2B/retail: Proven track record in growing and innovating at both consumer and B2B businesses with large geographic footprints and employee bases. Reinvigorated Home Depot’s consumer business while navigating the Great Recession and housing crisis. Championed Home Depot’s initiative designed to grow the B2B side of its business. • Financial expertise: Gained extensive and deep corporate finance expertise during her tenure at Home Depot and during her service on the Board of the Federal Reserve Bank of Atlanta, where she served as both Vice-Chair and Chair of the Board. • Strategic planning: As CEO of UPS, navigated the immense challenges and opportunities of the delivery and logistics business during the COVID-19 pandemic. Played a pivotal role in strategic business development at Home Depot as it transformed into one of the world’s largest retailers – during her tenure as CFO, Home Depot doubled sales to over $108 billion and generated a 450% increase in shareholder value. Career highlights: • Chief Executive Officer of United Parcel Service, Inc., the world’s largest package delivery company and a premier provider of global supply chain management solutions (2020-present) • The Home Depot, Inc., one of the world’s largest home improvement retailers o Executive Vice President – Corporate Services and Chief Financial Officer (2007-2019) o Chief Financial Officer (2001-2007) o Other Executive Positions (1995-2001) • Federal Reserve Bank of Atlanta o Director (2008-2013) Other public company boards: United Parcel Service, Inc. (since 2003) Cisco Systems, Inc. (2019-2020) Certain Fidelity Mutual Funds (2017) | Key skills and experience: • Leadership: Driving Verizon’s leadership position in the deployment of 5G technology and multi-access edge computing in the U.S. Built an industry-leading telecommunications software and services organization at Ericsson, one of the world’s largest telecommunications companies. Member of the Board of the United Nations Foundation that actively works with the U.N.’s Sustainable Development Goals. • Strategic planning: Implemented bold and innovative strategic changes, including Verizon 2.0, the transformation of Verizon’s operating model to a customer-focused business served by industry-leading networks, as well as Ericsson’s successful diversification into the software and services business from its traditional hardware-centric business. • Technology: Gained significant expertise in mobile technology and telecommunications network architecture as Verizon’s Chief Technology Officer and over his 25-year career at Ericsson. • Telecommunications: Brings to the Board extensive operational and strategic experience and a deep understanding of the challenges and opportunities presented in the evolving global telecommunications landscape, as well as in-depth knowledge of Verizon’s businesses. Career highlights: • Verizon Communications Inc. ¡ Chairman (2019 to present) and Chief Executive Officer (2018 to present) ¡ Executive Vice President, President – Global Networks and Chief Technology Officer (2017-2018) • Ericsson ¡ President and Chief Executive Officer (2010-2016) ¡ Chief Financial Officer (2007-2009) ¡ Other executive positions throughout the global operations Other public company boards: BlackRock, Inc. (since May 2021) Hexagon AB (2017-2018) |
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Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Gregory Weaver | ||||||||||
Independent Director since: 2015 Age: 70 Committees: Audit (Chair) Finance | ||||||||||
Key skills and experience: • Leadership: Twice elected by fellow partners to serve as Chairman and CEO of Deloitte & Touche LLP’s audit and enterprise risk services practice in the U.S., overseeing all operations, regulatory interaction and quality control for all audit and risk consulting clients. Led the firm through significant change in the accounting industry resulting from the passage of the Sarbanes-Oxley Act. • Financial expertise: Gained comprehensive public accounting experience at the highest level and substantial financial expertise over his 40 year career at Deloitte & Touche and as the lead audit partner for several of its largest clients, as well as through serving as a Trustee of the Goldman Sachs Trust. • Risk management: Developed a deep understanding of vertical and horizontal risk exposures – within companies and across industries – through providing enterprise risk services. Also led Deloitte & Touche through assessments of its own audit risk exposures. • Strategic planning: As a member of Deloitte’s Board of Directors and numerous management committees, helped shape strategic organizational priorities and relationships with regulators. Career highlights: • Deloitte & Touche LLP, the accounting, auditing and risk advisory subsidiary of Deloitte LLP ¡ Chairman and Chief Executive Officer (2001-2005 and 2012-2014) ¡ Member, Deloitte LLP Board of Directors (2006-2012) Other public company boards: Goldman Sachs Trust (since 2015) |
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Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
12Verizon 2019 Proxy Statement
Item 1: Election of Directors
Nominees for Election
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Verizon 2019 Proxy Statement 13
Verizon’s governance framework provides the Board with the flexibility to select the appropriate Board leadership structure for the Company. In making this leadership structure determination, the Board considers many factors, including the specific needs of the business and the long-term interests of our shareholders. We have historically combined the roles of Chairman and Chief Executive Officer, and our Board has been satisfied that a combined Chairman and CEO structure has served our shareowners well over time.
In June 2018, the Board elected Mr. Vestberg to succeed Mr. McAdam as CEO effective August 1, 2018, and appointed him to the Verizon Board. In order to facilitate an orderly succession plan, Mr. McAdam was appointed to continue to lead the Board as a non-independent Chairman. Given the dynamic and competitive environment in which Verizon operates, the Board believes that Verizon and our shareholders are best served by a Chairman who has broad and deep knowledge of our industry and the vision, energy and experience to position Verizon as the leader of transformational change in the communications ecosystem. Based on these considerations, when Mr. McAdam informed the Board of his decision to not stand for re-election, the Board determined that Mr. Vestberg was best qualified to serve in the role of Chairman.
To maintain an appropriate level of independent checks and balances in its governance, and consistent with the Corporate Governance Guidelines, the independent members of the Board have elected an independent Lead Director who has the
All Directors play an active role in overseeing Verizon’s business at both the Board and committee level. Every Director
The Board believes that shareholders are best served by this current leadership structure because it features an independent Lead Director who provides independent and objective oversight and who can express the Board’s positions in a forthright manner, as well as independent Directors who are fully involved in the Board’s operations and decision making. | ||||
Clarence Otis, Jr. Lead Director
Role of the Lead Director • Promotes a strong Board culture, including encouraging and facilitating active participation of all Directors • Approves the agenda, schedule and materials for all Board meetings, in consultation with the Chairman • Is available to advise the committee chairs in fulfilling their designated responsibilities • Acts as principal liaison with the Chairman
• Chairs executive sessions, including those held to evaluate the CEO’s performance and compensation
• Chairs any meeting of the Board if the Chairman is not present
• Calls Board meetings and executive sessions as needed
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• Oversees the process for CEO succession planning along with the Human Resources Committee
• Acts as a primary point of contact for Board communication with major shareholders and other key | ||||
Limiting service on other boards
Based on the evolving role of directors and the need to devote sufficient time to fulfill their responsibilities effectively, the Board Meetingshas adopted a policy that a Director who is an executive officer of a public company should serve on no more than two public company boards, and Executive Sessionsother Directors should serve on no more than four public company boards.
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Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Board meetings and executive sessions
In 2018,2021, our Board of Directors held nine11 meetings, including seven6 regularly scheduled meetings and two5 special meetings. Our Board met in virtual-only format, as well as in hybrid format, with safety measures in place for those attending in person, allowing for in-person interaction while retaining the flexibility to adapt to continually evolving COVID-19 pandemic circumstances and protocols in 2021.
No incumbent Director attended fewer than 75% percent of the total number of meetings of our Board and the committees to which the Director was assigned.assigned in 2021. Directors standing forre-election are expected to attend the annual meeting of shareholders. In 2018,2021, all nine Directors standing for re-election attended the annual meeting.meeting, which was conducted in a virtual-only format.
The Corporate Governance Guidelines require the independent Directors to meet in executive session without any members of management present at least twice a year to review and evaluate the performance of the Board and to evaluate the performance and approve the compensation of the CEO. In practice, our Board typically meets in executive session during each regular Board meeting.
14Verizon 2019 Proxy Statement
Board and Committees
Annual Board and Committee Assessments
Annual Board and Committee Assessments
Our Board conducts an annual assessment aimed at enhancing its effectiveness. As part of the assessment, each Director completes a written questionnaire that is designed to gather suggestions for improving Board effectiveness and to solicit feedback on a range of issues, including Board operations, Board and committee structure and dynamics, the flow of information from management, and agenda topics. In addition, the Lead Director conducts individual interviews with each of the independent Directors to discuss these topics. The feedback received from the questionnaires and interviews is discussed during an evaluation session.
Each of the four standing committees also conducts its own annual assessment, which includes a written questionnaire and evaluation session. Evaluation sessions are led by the committee chairs and generally include a review of the committee charter, the annual agenda, and the committee’s overall effectiveness.
In addition to these annual assessments, the Board evaluates and modifies its oversight of Verizon’s operations on an ongoing basis. During their executive sessions, the independent Directors consider agenda topics that they believe deserve additional focus and raise new topics to be addressed in future meetings.
The Corporate Governance and Policy Committee annually appraises the framework for our Board and committee assessment processes.
The 2018 Board Assessment Process Questionnaire Written questionnaires for the Board and each committee solicit Director feedback on an unattributed basis One-on-One Discussions Candid, one-on-one discussions between the Lead Director and each independent Director elicit further color on the Director's observations and suggestions Private Sessions of Directors Closed session discussions of the Board assessment are facilitated by our Lead Director, and committee assessment discussions are facilitated by the independent committee chairs Reporting A summary of the assessment results are provided to the Board Feedback Incorporated Policies and practices are updated as appropriate per the self-assessment observations and suggestions Ongoing Director suggestions for improvements to the assessment questionnaire and process are incorporated the following year
Verizon 2019 Proxy Statement 15
Board and Committees
Board Committees
Our Board of Directors has established four standing committees: the Audit Committee, the Corporate Governance and Policy Committee, the Finance Committee, and the Human Resources Committee. Each committee has a written charter that defines its specific responsibilities. The chair of each committee approves the agenda and materials for each meeting. Each committee has the authority to retain independent advisors to assist it in carrying out its responsibilities.
Our committee meetings are not held concurrently, which enables our Directors to sit on multiple committees. Our newly appointed Directors also attend all committee meetings for a period prior to being appointed to any particular committee, which gives them a broad-based introduction to the Company and allows them to understand the inner workings of all committees.
Where to find more information
You can find information about Verizon’s Directors, Board committees and a video from our Lead Director on the Corporate Governance section of our website at www.verizon.com/about/investors/corporate-governance. You can also access Verizon’s Corporate Governance Guidelines, Code of Conduct and other corporate governance materials, including Verizon’s certificate of incorporation, bylaws, committee charters and policies at that site. You can request copies of these materials from the Assistant Corporate Secretary at the address given under “Contacting us.”
In addition, you can access all of Verizon’s ESG reporting, including our ESG Report, TCFD Report, Transparency Reports, Political Engagement Reports and EEO-1 Report, as well as key company policies, through our ESG Resources Hub at www.verizon.com/about/investors/reporting.
Beyond the boardroom
Engagement outside of Board meetings provides our Directors with additional insight into our business and our industry, and gives them valuable perspectives on the performance of our Company, the Board, our CEO and other members of senior management, and on the Company’s strategic direction.
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Verizon 2022 Proxy Statement
Proxy summary |
| Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Audit Committee
Key
• Assess and discuss with management Verizon’s significant business risk exposures (including those related to cybersecurity, data privacy, data security and bribery and corruption) and oversee management’s programs and policies to monitor, assess and manage such exposures
• Assess Verizon’s overall control environment, including controls related to financial reporting, disclosure, compliance and significant financial and business risks
• Appoint, approve fees for, and oversee the work of the independent registered public accounting firm
• Oversee financial reporting and disclosure matters
• Oversee Verizon’s internal audit function
• Assess Verizon’s compliance processes and programs
• Review the Chief Compliance Officer’s annual report regarding anti-corruption compliance, compliance with significant regulatory obligations, export controls, and data protection
• Assess policies and procedures for executive officer expense accounts and perquisites, including the use of corporate assets
• Assess procedures for handling complaints relating to accounting, internal accounting controls or auditing matters
The Board has determined that each of Ms. Archambeau, Ms. | Members
Shellye Archambeau Roxanne Austin Laxman Narasimhan Clarence Otis, Jr. 2021 meetings 11 | |||
Corporate Governance and Policy Committee
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16Verizon 2019 Proxy Statement
Board and Committees
Board Committees
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• Evaluate the structure and practices of our Board and its committees, including size, composition, independence and operations
• Recommend changes to our Board’s policies or practices or the Corporate Governance Guidelines
• Identify and evaluate the qualifications of Director candidates
• Recommend Directors to serve as members of each committee and as committee chairs
• Review potential related person transactions
• Facilitate the annual assessment of the performance of the Board and its committees
• • Oversee Verizon’s position and engagement on important public policy issues, including those relating to political contributions, lobbying activities, and human rights, that may affect our business and reputation
social impact initiatives, including philanthropic activities | Members* Shellye Archambeau (Chair) Melanie Healey Laxman Narasimhan Rodney Slater * Vittorio Colao served on the Committee until February 13, 2021. 2021 meetings 6 | ||||||||
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Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Finance Committee
Key responsibilities and activities • Monitor Verizon’s capital needs and financing arrangements and ability to access the capital markets • Monitor expenditures under the annual capital plan approved by our Board • Review Verizon’s policies and strategies for managing currency, interest rate, renewable energy and counterparty exposures • Review and approve Verizon’s derivatives policy and monitor the use of derivatives, including our renewable power purchase agreement strategy • Review Verizon’s insurance and self-insurance programs • Oversee the investment of pension assets and the funding of pension and other postretirement benefit obligations |
Mark Bertolini (Chair)
Clarence Otis, Jr.
Carol Tomé Gregory Weaver
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2021 meetings
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Human Resources Committee
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Verizon 2019 Proxy Statement 17
Board and Committees
Board Committees
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Key
• Oversee the development of Verizon’s executive compensation program and policies
• Approve corporate goals relevant to the CEO’s compensation
• Evaluate the CEO’s performance and recommend his compensation to the Board
• Review and approve compensation and benefits for selected senior managers
• Consult with the CEO on talent development
• Oversee succession planning and assignments to key leadership positions
• Oversee human capital management, including with respect to employee diversity, equity and inclusion, talent acquisition, retention and development, employee engagement, pay equity and corporate culture • Review and make determinations under Verizon’s clawback policies
• Review the impact of Verizon’s executive compensation policies and practices, and the performance metrics underlying the compensation program, on Verizon’s risk profile
• Review and recommendnon-employee Director compensation |
Mark Bertolini Melanie Healey Clarence Otis, Jr. Rodney Slater 2021 meetings 7 | ||||||||
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Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Board and committee assessments
Our Board conducts a comprehensive annual assessment to enhance the effectiveness of the Board and its committees and to continue to reflect evolving best practices in their processes. While the assessment process is generally led by the Lead Director, the Board periodically engages a third-party consulting firm to bring an outside perspective to the process. As part of this robust assessment, each Director completes a detailed written questionnaire designed to elicit suggestions for improving Board and committee effectiveness and feedback on a range of issues, including Board leadership, culture, purpose and strategy, composition and structure and risk management. In addition, the Lead Director or the third-party consulting firm conducts individual interviews with each of the independent Directors to discuss these topics, among others. The Board discusses the feedback received from the questionnaires and interviews during an evaluation session facilitated by the Lead Director. The evaluation for 2021 was conducted by the Lead Director and concluded that the Board and its committees are operating effectively. The recommendations to further enhance Board effectiveness, which we addressed, include continued focus on strategic oversight, including 5G measures of success, as well as the development of Verizon’s next generation of leaders.
In addition to annual assessments, the Board evaluates and modifies its oversight of Verizon’s operations on an ongoing basis. During their executive sessions, the independent Directors consider agenda topics that they believe deserve additional focus and raise new topics to be addressed in future meetings.
The Corporate Governance and Policy Committee annually appraises the framework for our Board and committee assessment processes.
Board and committee assessment process | ||||||||||||||||||||
Feedback solicited Online questionnaire on |
| One-on-one Candid, one-on-one discussions between the Lead Director and Directors to elicit additional feedback | Reporting back A summary of the assessment results provided to the Board | Closed session discussion Closed session discussion of the assessment results facilitated by the Lead Director | Feedback Policies and practices updated as appropriate to address any suggestions or enhancements per the assessment | |||||||||||||||
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Director orientation and continuing education
18Verizon 2019 Proxy StatementWe provide our Directors with comprehensive orientation and education programs to promote a deep understanding of issues affecting our business and industry, help Directors stay current and knowledgeable about the Company’s business and its competitive and technology landscape, and support Directors in performing their oversight duties.
New Director orientation. When a new Director joins the Board, we conduct an orientation program that includes, among other things, a review of the Company’s purpose, business strategy and operations, technology, financial condition, legal and regulatory framework and other relevant topics.
Director continuing education. We support current Directors in their ongoing learning by providing continuing education opportunities and programs. These programs include presentations by thought leaders and industry experts, formal education sessions, meetings with management subject matter experts, participation in industry forums and site visits.
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Board and Committees
Risk OversightVerizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
RoleAll of our Directors have deep experience and expertise in strategic planning and execution. The Board engages Verizon’s senior leaders in robust discussions about strategic goals and challenges them to execute on the strategic plan, address emerging challenges and disruptions, and promote innovation. In addition to an annual strategy retreat, strategy is allocated substantial time on the agenda for each regular Board meeting. During these reviews, the Board engages with senior management regarding the competitive landscape, operational objectives and challenges and regulatory developments.
While senior management has primary responsibility for managing risk,business risks, our Board of Directors is responsible for risk oversight. The Board works with senior management to develop a comprehensive view of Verizon’s key short- and long-term business risks. Verizon has a formalized business risk management reporting process that is designed to provide visibility to the Board about critical risks and risk mitigation strategies. Through its oversight role, the Board sends a message to management that risk management is not an impediment to the conduct of business, but is instead an integral component of strategy, culture and business operations.
The Board of Directors oversees the management of risks inherent in the operation of Verizon’s businesses and the implementation of its strategic plan by using several different levels of review. The Board addresses the primary risks associated with Verizon’s business units and corporate functions in its operations reviews of those units and functions. In addition,Further, the Board reviews the risks associated with Verizon’s strategic plan throughout the year.
Role of the Committees
EachIn addition, each of our Board committees oversees the management of risks that fall within that committee’s areas of responsibility. In performing this function, each committee has full access to management and may engage advisors.
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Verizon 2019 Proxy Statement 19
Enterprise risk management program. The Audit Committee oversees the operations of Verizon’s enterprise risk management program, which identifies the primary risks to Verizon’s business, including risks related to cybersecurity, data privacy and security, and the Company’s supply chain. The Audit Committee periodically monitors and evaluates the primary risks associated with particular business units and functions. As part of Verizon’s annual enterprise risk assessment process, the Audit Committee reviews key business risks with the Chief Financial Officer and the Senior Vice President of Internal Audit. These risks inform Board and CommitteesAudit Committee discussion topics throughout the year.
Risk OversightIn addition, the Audit Committee works with Verizon’s Senior Vice President of Internal Audit, who helps identify, evaluate and implement risk management controls and methodologies to address identified risks and who functionally reports directly to the Committee. The Committee routinely meets privately with representatives from the independent registered public accounting firm, the Senior Vice President of Internal Audit, and the Chief Administrative, Legal and Public Policy Officer.
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20Verizon 2019 Proxy Statement
Board and Committees
Risk Oversight
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As our operating footprint expands, so does our responsibility to consider the impacts of our products and operations on society. New technologies and new markets present considerable opportunities, but also create new risks. Companies in our industry and beyond are facing challenges that have impacted their reputations and brought adverse attention and action by consumers, regulators, and shareholders. The Board is mindful of not only how the technologies we build will provide positive experiences for our customers, but also how they could otherwise have unintended consequences. In order to ensure that Verizon is doing everything possible to anticipate and plan for reputational risk, theCorporate Governance and Policy Committee oversees the Company’s handling of business and reputational risks relating to Verizon’s position and engagement on important public policy issues, including political contributions, lobbying activities, corporate social responsibility and sustainability, as well as individual events and incidents that may affect the Company’s reputation.
Strategic Crisis Management.crisis management. In order to position Verizon leadership and the Board to respond to strategic risks and protect Verizon’s core assets in a potential crisis, the Company recently refined itsmaintains a Strategic Crisis Management Program.Program. The Program defines clear roles and responsibilities in dealing with various potential crises and outlines a process to make decisions and implement appropriate actions on a timely basis. Through the Program, the VerizonStrategic Crisis Leadership Team is positioned to assume executive ownership of strategic crisis events through drills and scenario-based training. The Program also includes employee crisis awareness training in order to ensure thatencourage employees across the Company are prepared to quickly identify and report circumstances or events that could develop into a strategic crisis so that our leadership team can take appropriate steps in response. In addition, Verizon’s Board maintains aBoard Crisis Response Plan,, which is a structured plan to be used in connection with any crisis that could have a significant strategic impact on the Company’s brand, reputation, finances or legal, political or regulatory position—position – providing a framework for ensuring appropriate Board oversight and assessment of the response to a crisis, while allowing the necessary flexibility to address the different types of crises that might arise.
Financial risk and capital allocation. The Finance Committee assists our Board in its oversight of financial risk management. In performing this function, the Finance Committee monitors Verizon’s capital needs and financing plans and oversees the strategy for managing risks related to currency, interest rate and renewable energy exposures. The Finance Committee reviews and approves the Company’s derivatives policy and monitors the use of derivatives. The Finance Committee also reviews Verizon’s pension and other postretirement benefit obligations, as well as its insurance and self-insurance programs.
15
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Oversight of CurrentESG strategy and risks
Our Board recognizes that operating responsibly – minimizing the environmental impact of our operations, protecting the privacy of our customers’ information and respecting human rights by creating an environment of respect, integrity and fairness for our employees and customers wherever we do business – is fundamental to the long-term success of our Company. The Corporate Governance and Policy IssuesCommittee oversees corporate responsibility and sustainability. Verizon has a Chief ESG Officer dedicated to enhancing the Company’s sustainability reporting and stakeholder engagement on environmental, social and governance issues that align with Verizon’s core business strategy. The Chief ESG Officer heads a cross-functional team that focuses on strategic areas including governance, reporting, human rights, environmental sustainability and digital trust and safety and also oversees Verizon’s efforts to deliver on its ESG commitments. The Chief ESG Officer regularly provides the Corporate Reputation.Each year,Governance and Policy Committee with updates on the Company’s ESG priorities, commitments and reporting.
Environmental sustainability and climate. To address climate-related risks, Verizon is upgrading and hardening our infrastructure to be prepared for a changing climate, improving energy efficiency across our networks and facilities, making substantial investments in renewable energy and developing solutions to help our customers to reduce their carbon footprints. We have announced science-based emissions reduction targets for our Scope 1, 2 and 3 emissions and have set ambitious goals to source or generate renewable energy equivalent to 50% of our total annual electricity consumption by 2025 and to achieve net zero operational emissions (Scope 1 and 2) by 2035. The Executive Climate Oversight Committee, composed of Verizon’s Executive Vice President of Public PolicyChief Financial, Chief Administrative, Chief ESG and General CounselChief Sustainability Officers, monitors Verizon’s progress on these initiatives and commitments and recommends changes or enhancements to our climate strategy. Representatives from the Strategy, Network, Fleet, Global Real Estate, Treasury, Sustainability and ESG organizations report to the committee on climate-related issues and initiatives that fall within their responsibilities. The Chief ESG Officer periodically updates the Corporate Governance and Policy Committee on the issues considered by the committee, the Company’s progress in meeting its climate-related commitments, and any significant developments relating to the Company’s strategy for managing climate-related risks.
Each committee of the Board oversees the management of the specific risks related to our environmental sustainability strategy and the transition to a low carbon economy that fall under the committee’s area of responsibility:
Audit Committee: Environmental and climate-related risks discussed during annual business risk reviews with the Audit Committee include operational and financial risks relating to energy management and our renewable energy and carbon neutral commitments, maintaining network reliability during catastrophic and weather-related events, and the impacts of possible laws or regulations that seek to mitigate climate change.
Corporate Governance and Policy Committee: The Corporate Governance and Policy Committee oversees Verizon’s progress on meeting our environmental sustainability commitments.
Finance Committee: The Finance Committee oversees the strategy for managing risks related to Verizon’s renewable energy exposure through renewable energy purchase agreements, as well as the Company’s green financing strategy.
Human Resources Committee: To motivate management to be good stewards of our planet and reduce the environmental impact of our operations, the Human Resources Committee has included a carbon intensity reduction target as one of the performance measures in the Short-Term Incentive Plan (Short-Term Plan) since 2014.
Data privacy and cybersecurity. Protecting the privacy of our customers’ information and the security of our systems and networks has long been and will continue to be a priority at Verizon. The Board is committed to maintaining strong and meaningful privacy and security protections for our customers’ information. The Audit Committee has primary responsibility for overseeing Verizon’s risk management programs relating to data protection and privacy and cybersecurity. The Audit Committee also monitors Verizon’s compliance in the areas of data protection and privacy.
Data protection and privacy. Verizon has technical, administrative and physical safeguards in place to help protect against unauthorized access to, use or disclosure of customer information and data we collect and store. Verizon has a dedicated Chief Privacy Officer whose team advises the business on privacy risks and assesses the effectiveness of privacy controls. The Chief Privacy Officer annually briefs the Audit Committee on data privacy risks and mitigating actions.
Cybersecurity. To more effectively address the cybersecurity threats posed today, Verizon has a dedicated Chief Information Security Officer whose team is responsible for leading enterprise-wide information security strategy, policy, standards, architecture and processes. Verizon’s comprehensive information security program includes, among other aspects, vulnerability management, antivirus and malware protection, file integrity monitoring, encryption and access control. The Chief Information Security Officer leads an annual review and discussion with the full Board dedicated to Verizon’s cyber risks and threats and cyber protections and provides updates throughout the year, as warranted.
16
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Responsible business. Verizon’s Responsible Business Council, chaired by the CEO and composed of members of the senior leadership team, oversees the integration of responsible practices as a core operating principle. At least annually, the Chief Corporate Social Responsibility Officer reports to the Board on the Council’s activities and Verizon’s community and social impact initiatives.
Current policy issues and corporate reputation. Companies in our industry and beyond are facing challenges that have impacted their reputations and brought adverse attention and action by consumers, regulators, and shareholders. The Corporate Governance and Policy Committee has primary responsibility for overseeing the Company’s handling of business and reputational risks relating to Verizon’s position and engagement on important public policy issues, as well as individual events and incidents that may affect the Company’s reputation. Each year, Verizon’s Chief Administrative, Legal and Public Policy Officer updates the Committee on the current policy issues facing the Company that may generate publicity and impact corporate reputation.reputation. Through this annual briefing, the Committee reviews and discusses with management the most pressing known reputational issues and the Company’s policyposition on each issue, as well as the processes in place to anticipate potential developments in each of the identified areas and to quickly respond to any such developments in a timely manner. Outside the regular meeting cycle, management makes sure that the Board is informed of current developments that may pose reputational risks to the industry or the Company.
Political activities and lobbying. Verizon adheres to the highest ethical standards when engaging in any political activity. Our political activity, including lobbying, is overseen by the Corporate Governance and Policy Committee, which receives a comprehensive briefing from the Chief Administrative, Legal and Public Policy Officer on these activities at least annually. Moreover, Verizon’s political activity is subject to robust internal controls. The Code of Conduct requires that all lobbying activities on behalf of Verizon be authorized by public policy or legal personnel. Corporate policy and training materials provide guidance to employees regarding legal requirements in connection with lobbying activities.
Verizon understands that transparency regarding our political activity is critical to maintaining the trust of our stakeholders. We publish a political engagement report on our corporate website that is updated twice a year that lists all political action committee contributions and corporate political contributions. Our report also discloses our Public Policy organization’s memberships in trade associations and issue advocacy organizations for which our support exceeds $50,000 annually. Verizon supports these organizations for a number of reasons, including to reflect our interest in the community, to acquire valuable industry and market expertise, and to support specific strategic policy and business goals and interests. These groups often have a diversity of members, interests and viewpoints that do not necessarily reflect Verizon’s beliefs or priorities and we may not always agree with all of the positions of each organization or its members. When we disagree with a position of an organization we support, we communicate our concerns through the senior executives who interact with these organizations. Verizon also takes these differences under consideration when determining whether support of an organization is, on balance, in the best interests of the Company and its stakeholders.
Human rights. As expressed in its Human Rights Statement, Verizon is committed to operating with respect for internationally recognized human rights. We have a dedicated Business and Human Rights Program that works to embed human rights considerations into responsible business decision-making processes across the Company. Our human rights efforts are overseen by the Corporate Governance and Policy Committee.
Anti-corruption. Verizon has a robust anticorruption program to comply with applicable anticorruption rules, including the Foreign Corrupt Practices Act and the U.K. Bribery Act. As part of this program, the Audit Committee receives annual reports summarizing the Company’s continued compliance with applicable anticorruption rules. Every two years, we review and assess our anti-corruption program with the goal of finding areas for improvement. This process is done under the direction of our Chief Compliance Officer, who reports the findings to the Audit Committee.
Oversight of human capital management
Oversight of human capital management, including culture and employee engagement, diversity, equity and inclusion and talent acquisition and development, historically has been conducted by the full Board, as well as the Human Resources Committee. In 2021, the Board amended the Human Resources Committee Charter to expressly delegate to the Committee oversight responsibilities in relation to human capital management.
Culture and employee engagement. Our Board views our employees as one of Verizon’s most critical assets and regularly receives briefings from the CEO on initiatives to strengthen our company culture and encourage employee engagement. The CEO reviews with the Board the results of the “Pulse” surveys completed by employees across the Company. Periodically, our Directors attend employee town halls and participate in leadership forums with employees.
Verizon 2019 Proxy Statement 2117
Board and Committees
Management Succession Planning and DevelopmentVerizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Management Diversity, equity and inclusion. Verizon is committed to creating a collaborative, inclusive, equitable and diverse environment – within Verizon, with our customers and among our business partners and suppliers. The Board views this commitment as a business imperative and a competitive advantage. To promote diversity in our workforce and encourage the contribution of diverse business partners to our success, the Human Resources Committee has included diversity targets as performance measures in the Short-Term Plan for over 20 years. The Chief Human Resources Officer reviews diversity representation and initiatives with the Committee at least annually.
Succession Planningplanning and Developmenttalent development.
Verizon’s Our Board of Directors recognizes that one of its most important duties is to ensurepromote continuity in ourVerizon’s senior leadership by overseeing the development of executive talent and planning for the efficient succession of the CEO. Our Board has delegated primary oversight responsibility for succession planning to the Human Resources Committee, which oversees assignments to key leadership positions. The Human Resources Committee reports on its activities to the full Board, which addresses succession planning during executive sessions that typically occur in connection with each regularly scheduled meeting.
To ensure thatalign the succession planning and management development process supports and enhanceswith Verizon’s strategic objectives, the Board and Human Resources Committee regularly consult with the CEO on Verizon’s organizational needs and competitive challenges, the potential of key managers, and plans for future developments and emergency situations. As part of this process, the Board and the Human Resources Committee also seek input from the Chief AdministrativeHuman Resources Officer, as well as advice on related compensation issues from the Human Resources Committee’s independent compensation consultant.
Our Board generally conducts anin-depth review of senior leader development and succession planning at least oncetwice a year. Led by the CEO and the Chief AdministrativeHuman Resources Officer, this review addresses Verizon’s management development initiatives, assesses senior management resources, and identifies individuals who should be considered as potential future senior executives.
Our goal is to develop well-rounded, experienced and experienceddiverse senior leaders. High potential executives are challenged regularly with additional responsibilities, new positions or promotions to expose them to our diverse operations. These individuals are often positioned to interact more frequently with the Board, both in full Board meetings and in less formal settings and small groups, so the Directors can get to know and assess them.
In 2018,Employee health and safety. Verizon saw the culmination of a deliberate and comprehensive succession planning process conducted by the Board over the course of multiple years when Mr. Vestberg stepped into the role of CEO. Throughout the process, the Board focused on the strategic direction of the business and the vision for where the Company needed to be in five to ten years to form the basis of a talent profile and selection criteria for the next CEO. This comprehensive process underpins the Board’s confidence that Mr. Vestberg has the right character, skills and global perspective to drive transformational change and lead the Company into the future. In addition, throughout the CEO succession planning process, the Board was actively focused on ensuring the smooth CEO transition criticalis committed to maintaining a well-functioning company while buildingsafe workplace and environmentally responsible work practices, and we expect our suppliers to share that commitment. At least annually, the Chief Human Resources Officer briefs the Human Resources Committee on the Company’s health and safety protocols, incidents involving employees and suppliers, and actions that management is taking to limit these risks.
Compensation risk. The Human Resources Committee considers the impact of our executive compensation program and the incentives created by compensation awards on Verizon’s overall risk profile. It also oversees management’s annual assessment of compensation risk arising from Verizon’s compensation policies and practices. This annual assessment is conducted by members of management including the Senior Vice President of Internal Audit and the Corporate Secretary. The assessment includes a track recordreview of performance. In order to implement this successful transition, the Board appointed Mr. McAdam to remain as a non-independent Chairman, positioning him to provide leadership continuityfeatures and characteristics of Verizon’s compensation policies and programs, the performance metrics under the Short- and Long-Term Incentive Plans and the process for calculating and approving adjustments that are part of the plan, as well as advicethe approval processes for compensation programs and guidancerelated payouts. The assessment also reviews governance oversight at the Committee and Board level, Code of Conduct provisions and mandatory training programs that reinforce policies that mitigate risk, and performance metrics and measurement periods that are aligned with Verizon’s business strategy.
Based on management’s review, Verizon has concluded that our compensation policies and procedures are not reasonably likely to Mr. Vestberghave a material adverse effect on Verizon because they are appropriately structured and discourage employees from taking excessive risks.
Business conduct and ethics. We are committed to operating with the highest level of integrity, responsibility and accountability. To that end, we have adopted a Code of Conduct that applies to all employees, including the CEO, the Chief Financial Officer and the Board during a transition period.Controller. The Code of Conduct describes each employee’s responsibility to conduct business with the highest ethical standards and provides guidance about preventing, reporting and remediating potential compliance violations in key areas. Verizon thoroughly investigates all claims of misconduct. Various types of cases are reported to the Chief Compliance Officer, who discusses the most serious Code violations with the Audit Committee at least annually.
22Verizon 2019 Proxy Statement18
Board and Committees
Shareholder EngagementVerizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Directors are expected to act in the spirit of the Code of Conduct, and to comply with the specific ethical provisions of the Corporate Governance Guidelines. Our Board is strongly predisposed not to waive any of these business conduct and ethics provisions for executive officers or Directors. In the unlikely event of a waiver, we will promptly disclose the Board’s action on our website.
Related person transactions. The Board has adopted the Related Person Transaction Policy that is included in the Guidelines. The Corporate Governance and Policy Committee reviews transactions between Verizon and any of our Directors or executive officers or members of their immediate families to determine if any participants have a material interest in the transaction. If the Committee determines that a material interest exists, based on the facts and circumstances of each case, the Committee may approve, disapprove, ratify or cancel the transaction or recommend another course of action. Any Committee members who are involved in a transaction under review do not participate in the Committee’s deliberations. During 2021, there were no related person transactions required to be disclosed in this proxy statement.
Shareholder EngagementOur approach to shareholder engagement
We believe that a robust shareholder outreach program is an essential component of maintaining our strong corporate governance practices. Ongoing communication with our shareholdersinvestors helps theour Board and senior management gaingather useful feedback on a wide range of subjects and understand the issues that matter most totopics. In our shareholders. Verizon views accountability to shareholders as both a mark of good governance and a critical component of our success. In 2018, management and our Directors metdiscussions with our shareholders and engaged in discussionsinvestors, we seek their input on a variety of issues, including Board oversightcorporate governance, compensation and ESG topics that may impact our business or reputation. We strive for a collaborative approach with investors to solicit and understand a variety of Company strategy; CEO succession;perspectives. These engagements include the leadership structureparticipation of the Board; Board compositionour independent Lead Director, Clarence Otis, Jr., or other Directors, when requested and refreshment; sustainabilityappropriate. Shareholder feedback is regularly summarized and corporate responsibility; and the relationship betweenshared with our compensation program and our long-term strategy.Board.
In 2021, topics covered in engagement included:
Environmental • Climate change – net zero emission plan • Device and e-waste recycling • Network reliability and resilience | Social • Cybersecurity • Digital inclusion • Human capital, including diversity, equity and inclusion • Supply chain | Governance • Board diversity and skills • Business ethics • Executive compensation • Human rights • Political engagement | Disclosure • SASB industry standard • TCFD, including scenario analyses • Human capital metrics • ESG data index |
In addition to our regular shareholder engagement, in 2021, our Chief Financial Officer and our Corporate Secretary participated in calls with key investors to discuss our growth strategy and its relationship to our Board composition and refreshment plans. Our Chief Financial Officer also hosted a special engagement event focused on climate featuring senior leaders from the Network, Supply Chain, Treasury and ESG organizations for our 50 largest investors.
Also in 2021, our Lead Director, Clarence Otis, Jr., discussed corporate purpose, decisions about when to speak on social issues, Board oversight of human capital management, and Board composition and refreshment in a video on the Corporate Governance section of our website at www.verizon.com/about/investors/corporate-governance.
Verizon’s dedicated ESG team focuses on stakeholder engagement and decision-useful reporting in strategic areas including governance, human rights, environmental sustainability and digital trust and safety and also oversees Verizon’s efforts to deliver on its ESG commitments. Over the past two years, in response to feedback from our investors, we have aligned our ESG reporting with the Sustainability Accounting Standards Board standards for the telecommunications industry and the recommendations of the Task Force on Climate-Related Financial Disclosures. We strive to make it easy for shareholders to learn about our positions and progress on the issues that matter to them. To that end, we have created an ESG Resources Hub on our Investor Relations website at www.verizon.com/about/investors/reporting that houses all of our ESG reporting and policies.
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Verizon 2022 Proxy Statement
summary |
Governance | compensation | matters | Stock ownership | Shareholder proposals | Additional information |
The information learned in these discussions serves as the foundation for our policies and informs our business strategy on an ongoing basis.
2021 annual ESG reporting cycle
Communicating with our Directors
Our Board of Directors believes that communication with shareholders and other interested parties is an important part of the governance process, and has adopted the following procedure to facilitate this communication.
How to Contactcontact the Board
Any shareholder or interested party may communicate directly with our Board, any committee of our Board, any individual Director (including the Lead Director and the committee chairs) or thenon-employee Directors as a group, by writing to:
Verizon Communications Inc.
Shellye Archambeau
Roxanne Austin
Independent Director since: 2013
Age: 59
Committees:
Audit
Corporate Governance and Policy (Chair)
Independent Director since: 2020
Age: 61
Committees:
Audit
Finance
Key skills and experience: • Leadership: Highly regarded and accomplished executive with over 30 years of experience building and scaling consumer and B2B businesses in the technology industry. As CEO of MetricStream, led the company’s transformation into a leader in Governance, Risk and Compliance solutions. • Marketing: Served as Chief Marketing Officer at two public companies (Loudcloud and NorthPoint Communications), leading the design and implementation of all sales and marketing strategies and driving revenue growth. As President of Blockbuster.com, launched the entertainment retailer’s first online presence. • Risk management: Acquired significant expertise with integrated enterprise risk management, regulatory compliance functions and quality, vendor and audit management software solutions across a wide array of industries during her tenure at MetricStream, as well as through service on the audit committees of Verizon, Okta and Arbitron. • Technology: Gained valuable experience developing and marketing emerging technology applications and solutions, including internet infrastructure, cloud-based and identity security services, business software platforms, e-commerce and digital media. Career highlights: • MetricStream Inc., a leading provider of governance, risk, compliance and quality management ¡ Chief Executive Officer (2002-2018) • Executive Positions at Loudcloud, Inc., NorthPoint Communications, Blockbuster Inc. and IBM (domestic and international) (1984-2002) Other public company boards: Nordstrom, Inc. (since 2015) Okta, Inc. (since 2018) Roper Technologies, Inc. (since 2018) | Key skills and experience: • Leadership: Seasoned leader who served as CEO of Move Networks, President and COO of DIRECTV, and CFO of Hughes Electronics. Named 2018 Director of the Year – Corporate Leadership and Service by the Forum for Corporate Directors and one of the most influential directors in the board room by the National Association of Corporate Directors in 2013. Serves as co-chair of the annual Corporate Governance Conference at Northwestern’s Kellogg School of Management. • Cybersecurity: Acquired significant cybersecurity experience through her extensive management and operating roles in a range of technology industries, including service as a director of CrowdStrike, a leader in cloud-delivered endpoint protection. • Financial expertise: Developed a comprehensive background in finance and accounting as a public company audit committee member, CFO of Hughes Electronics and a partner at Deloitte & Touche LLP. Chairs the U.S. Mid-Market Advisory Committee of EQT Partners. • Strategic planning: Oversaw a dramatic turnaround of the business within one year of her arrival at DIRECTV, with cash flow increasing from negative $400 million annually to cash flow positive by $400 million, and revenue increasing by 40%. Overhauled customer service at DIRECTV, resulting in the company winning J.D. Power’s award ranking #1 in customer satisfaction. Career highlights: • President and Chief Executive Officer of Austin Investment Advisors, a private investment and consulting firm (2003-present) • President and Chief Executive Officer of Move Networks, Inc., an IP-based television delivery service (2009-2010) • President and Chief Operating Officer of DIRECTV, Inc., a digital television entertainment service (2001-2003) • Chief Financial Officer and Various Executive Positions at Hughes Electronics Corporation (1993-2001) • Audit Partner and Various Audit Positions at Deloitte & Touche LLP (1983-1993) Other public company boards: Abbott Laboratories Inc. (since 2000)* AbbVie, Inc. (since 2013) CrowdStrike Holdings, Inc. (since 2018) Freshworks Inc. (since September 2021) Teledyne Technologies Incorporated (2006-April 2021) Target Corporation (2002-2020) Ericsson (2008-2016) * Ms. Austin will not stand for re-election to the Abbott Laboratories Board of Directors at the end of her current term expiring at the April 29, 2022 annual shareholders meeting. |
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Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Mark Bertolini
| Melanie Healey | |||||||||
Independent Director Age: 65 Committees: Finance (Chair) Human Resources | Independent Director
Age: 60 Committees: Corporate Governance and Policy Human Resources | |||||||||
Key skills and experience: • Leadership: Recognized as an accessible, forward-thinking and solutions-oriented leader. Transformed Aetna from a traditional health insurance company to a consumer-oriented health care company focused on delivering holistic integrated care to local communities and serving over 46 million people. • Financial expertise: Developed deep financial and risk management expertise in his executive roles at Aetna and as a • Regulatory/public policy: A national health care thought leader with extensive regulatory and public policy experience. Successfully navigated changes in the health insurance marketplace resulting from the Affordable Care Act and led Aetna through antitrust reviews of various acquisitions and proposed acquisitions. • Strategic planning: Led Aetna through a period of strategic and regulatory transformation and domestic and international growth through strategic acquisitions and dispositions, culminating in the $78 billion acquisition of Aetna by CVS completed in 2018. Career highlights: • Co-Chief Executive Officer of Bridgewater Associates, LP, a global investment management firm (January 2022-present) • Aetna Inc., a multi-national, Fortune 100 diversified healthcare benefits company ¡ Chairman (2011-2018) ¡ Chief Executive Officer (2010-2018) ¡ President (2007-2010) ¡ Other Executive Positions (2003-2007) • Executive Positions at Cigna, NYLCare Health Plans and SelectCare, Inc. Other public company boards: CVS Health Corporation (2018-2020) | Key skills and experience: • Leadership: Accomplished, consumer-focused executive with substantial global experience and a track record of delivering growth, driving operational improvements and launching successful product innovations over a 33-year career at 3 global iconic consumer product brand companies, including leading a global business for 6 years. • Consumer/B2B/retail: Gained deep and valuable branding, distribution and operating experience with consumer wellness products on a global scale over a long career at 3 different multi-national organizations in the consumer goods industry (Procter & Gamble, Johnson & Johnson and S.C. Johnson & Sons). Continues to focus on the consumer/retailing sector through service on the Target board of directors and on a globally recognized consumer and B2B brand through service on the board of Hilton, which has over 6,000 properties in over 100 countries and territories. • Marketing: Brings a multi-cultural and multi-national perspective acquired from working 18 years internationally to corporate strategy with respect to brand building, new product and commercial innovation and the consumer experience, as
• Strategic planning: As Group President of North America at Procter & Gamble, oversaw multi-year strategic planning for the largest division of the
Career highlights: • The Procter & Gamble Company, a leading provider of branded consumer packaged goods ¡ Group President (2007-2015) ¡ Other Executive Positions (1990-2015) • Johnson & Johnson (1986-1990) • S.C. Johnson & Sons (1983-1986) Other public company boards: Hilton Worldwide Holdings Inc. (since 2017) PPG Industries, Inc. (since 2016) Target Corporation (since 2015) |
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Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Laxman Narasimhan | Clarence Otis, Jr. (Lead Director) | |||||||||
Independent Director since: 2021 Age: 54 Committees: Audit Corporate Governance and Policy | Independent Director since: 2006 Age: 65 Committees: Audit Finance Human Resources | |||||||||
Key skills and experience: • Leadership: Insightful and strategic leader with wide experience across the consumer goods sector and a proven track record in developing purpose-led brands, including as chief executive of Reckitt Benckiser Group Plc, a FTSE 12 listed British multinational global consumer health, hygiene and nutrition company. Credited with improving sales and profit while managing approximately $18 billion in revenue at businesses across 100 countries and 125,000 employees as CEO of PepsiCo’s Latin America, Europe and Sub-Saharan Africa operations. • Consumer/B2B/retail: Provides valuable experience and thought leadership in complex global consumer-facing businesses as a result of a career approaching 30 years in the space. Prior to joining Reckitt Benckiser and PepsiCo, spent 19 years at McKinsey & Company, focusing on its consumer, retail and technology practices in the United States, Asia and India. • Risk management: Developed significant risk management experience, including supply chain risk management experience, while piloting Reckitt Benckiser through the supply chain disruptions of the COVID-19 pandemic. • Strategic planning: Articulated corporate purpose and drove strategic change while transitioning into the leadership role at Reckitt Benckiser during the COVID-19 pandemic. Eliminated complexity and simplified operations in order to remain agile and manage surging demand for certain consumer products during the pandemic. Career highlights: • Chief Executive Officer of Reckitt Benckiser Group Plc, a global consumer-goods company (2019-present) • PepsiCo, Inc., a leading global food and beverage company ¡ Global Chief Commercial Officer (2019) ¡ Chief Executive Officer, Latin America, Europe and Sub-Saharan Africa (2017-2019) ¡ Other Executive Positions (2012-2017) • McKinsey & Company (1993-2012) Other public company boards: Reckitt Benckiser Group Plc (since 2019) | Key skills and experience: • Leadership: Led Darden Restaurants, Inc., the largest company-owned and operated full-service restaurant company in the world, as CEO for 10 years, achieving sales growth of over 75% during the period. Known as a purpose-driven and values-based leader, with Darden being recognized by Fortune magazine for four consecutive years during his tenure as one of its 100 Best Companies to Work For. • Consumer/B2B/retail: Brings deep and valuable insights into consumer services and retail operations gleaned from his experience leading a Fortune 500 company that owned well-known national consumer brands including Olive Garden, LongHorn Steakhouse, Red Lobster and Capital Grille. Further consumer and retail expertise through board position at VF Corporation, which owns well-known national brands including Timberland and North Face. • Financial expertise: Gained substantial financial expertise through, among other roles, investment banking positions of increasing seniority over 12 years, the CFO role at Darden, serving as a Director of the Federal Reserve Bank of Atlanta and as trustee or director of mutual funds pursuing a wide array of investment strategies. • Risk management: Acquired significant expertise with financial risk assessment and enterprise risk management during his career in investment banking and at Darden, as well as through his many years of service on the Federal Reserve Bank of Atlanta Board, the Audit Committees of VF Corporation and Verizon, the Investment & Capital Markets Committee of Travelers and as a Trustee of 138 funds within the MFS Mutual Fund complex. Career highlights: • Darden Restaurants, Inc. ¡ Chairman (2005-2014) ¡ Chief Executive Officer (2004-2014) ¡ Other Executive Positions (1995-2014) • Director of the Federal Reserve Bank of Atlanta (2010-2015) • Investment banker and lawyer specializing in securities and finance Other public company boards: The Travelers Companies, Inc. (since 2017) VF Corporation (since 2004) MFS Mutual Funds complex (since 2017) |
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Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Daniel Schulman | Rodney Slater | |||||||||
Independent Director since: 2018 Age: 64 Committees: Human Resources (Chair) | Independent Director since: 2010 Age: 67 Committees: Corporate Governance and Policy Human Resources | |||||||||
Key skills and experience: • Leadership: Successful and dynamic leader in the fiercely competitive technology and e-commerce space with a proven track record of creating shareholder value through innovation and a focus on values at numerous companies, including PayPal, which has approximately 415 million active accounts across more than 200 markets, Priceline, and Virgin Mobile USA. • Cybersecurity: Gained extensive cybersecurity and risk management experience as a director of Symantec Corporation, a global leader in cybersecurity, for nearly 20 years, including serving as the independent chairman for 6 years. • Strategic planning: Spearheaded innovation and growth at start-ups and established companies, including Priceline, where he grew annual revenues from $20 million to nearly $1 billion over two years, Virgin Mobile USA, where he successfully built a pre-paid cellphone business, American Express, where he expanded global mobile and online payment services, and PayPal, where he has achieved significant revenue growth and stock price appreciation. • Technology: Acquired significant expertise in mobile technology and digital innovation over a long career spanning the telecommunications, financial technology and e-commerce industries. Career highlights: • PayPal Holdings, Inc., a leading online payments company ¡ President and Chief Executive Officer (2015-present) ¡ President and CEO-Designee (2014-2015) • Group President of the Enterprise Group at American Express Company (2010-2014) • President of the Prepaid Group at Sprint Nextel Corporation (2009-2010) • Founding CEO of Virgin Mobile USA, Inc. (2001-2009) • President and CEO of Priceline Group, Inc. • Various Executive Positions, including President of the Consumer Markets Division, at AT&T, Inc. Other public company boards: PayPal Holdings, Inc. (since 2015) Symantec Corporation (2000-2019) FLEX LTD. (2009-2018) | Key skills and experience: • Leadership: Nationally recognized for innovative infrastructure development and forging strategic public and private partnerships. As U.S. Secretary of Transportation, oversaw national transportation policy, spearheaded several historic legislative measures, including record funding for surface transportation investment and aviation safety and security, promoted intermodal transportation systems and led effort to significantly expand high speed rail network. • Regulatory/public policy: Brings a strategic, collaborative and result-oriented approach to oversight of regulatory and public policy issues developed over his long and accomplished career in both the public and private sectors. • Risk management: Globally recognized advisor for reputational risk management, corporate compliance and emergency preparedness, having served as an independent monitor/advisor for Toyota, Takata and Fiat Chrysler as these companies worked through safety issues, and coordinated the Federal Highway Administration’s response to several major natural disasters. • Strategic planning: Implemented a visionary strategic plan for the U.S. Department of Transportation to expand its focus on safety, mobility and access, economic development and trade, the environment and national security. Developed an innovative financing and contracting program at the Federal Highway Administration that produced significant operational and cost efficiencies. Career highlights: • Partner, Squire Patton Boggs LLP, a law firm (2001 to present) • U.S. Secretary of Transportation (1997-2001) • Administrator, Federal Highway Administration (1993-1997) • Various policy positions with the State of Arkansas Other public company boards: EVgo Inc. (since July 2021) Stagwell Inc. (since August 2021) Kansas City Southern (2001-2019) Transurban Group (2009-2018) |
7
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Carol Tomé | Hans Vestberg (Chairman) | |||||||||
Independent Director since: 2021 Age: 65 Committees: Finance | Director since: 2018 Age: 56 | |||||||||
Key skills and experience: • Leadership: After being appointed CEO of UPS in June 2020, led the company through an unprecedented surge in demand for services, while improving competitiveness and reducing bureaucracy. Demonstrated strong financial leadership as CFO for over 18 years at Home Depot, with responsibility for all corporate finance matters including financial reporting, financial planning and analysis, financial operations, internal audit, investor relations and tax. Led strategic business development during a critical time for Home Depot, as well as the IT and security function. • Consumer/B2B/retail: Proven track record in growing and innovating at both consumer and B2B businesses with large geographic footprints and employee bases. Reinvigorated Home Depot’s consumer business while navigating the Great Recession and housing crisis. Championed Home Depot’s initiative designed to grow the B2B side of its business. • Financial expertise: Gained extensive and deep corporate finance expertise during her tenure at Home Depot and during her service on the Board of the Federal Reserve Bank of Atlanta, where she served as both Vice-Chair and Chair of the Board. • Strategic planning: As CEO of UPS, navigated the immense challenges and opportunities of the delivery and logistics business during the COVID-19 pandemic. Played a pivotal role in strategic business development at Home Depot as it transformed into one of the world’s largest retailers – during her tenure as CFO, Home Depot doubled sales to over $108 billion and generated a 450% increase in shareholder value. Career highlights: • Chief Executive Officer of United Parcel Service, Inc., the world’s largest package delivery company and a premier provider of global supply chain management solutions (2020-present) • The Home Depot, Inc., one of the world’s largest home improvement retailers o Executive Vice President – Corporate Services and Chief Financial Officer (2007-2019) o Chief Financial Officer (2001-2007) o Other Executive Positions (1995-2001) • Federal Reserve Bank of Atlanta o Director (2008-2013) Other public company boards: United Parcel Service, Inc. (since 2003) Cisco Systems, Inc. (2019-2020) Certain Fidelity Mutual Funds (2017) | Key skills and experience: • Leadership: Driving Verizon’s • Strategic planning: Implemented bold and innovative strategic changes, including Verizon 2.0, the transformation of Verizon’s operating model to a customer-focused business served by industry-leading networks, as well as Ericsson’s successful diversification into the software and services business from its traditional hardware-centric business. • Technology: Gained significant expertise in mobile technology and telecommunications network architecture as Verizon’s Chief Technology Officer and over his 25-year career at Ericsson. • Telecommunications: Brings to the Board extensive operational and strategic experience and a deep understanding of the challenges and opportunities presented in the evolving global telecommunications landscape, as well as in-depth knowledge of Verizon’s businesses. Career highlights: • Verizon Communications Inc. ¡ Chairman (2019 to present) and Chief Executive Officer (2018 to present) ¡ Executive Vice President, President – Global Networks and Chief Technology Officer (2017-2018) • Ericsson ¡ President and Chief Executive Officer (2010-2016) ¡ Chief Financial Officer (2007-2009) ¡ Other executive positions throughout the global operations Other public company boards: BlackRock, Inc. (since May 2021) Hexagon AB (2017-2018) |
8
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Gregory Weaver | ||||||||||
Independent Director since: 2015 Age: 70 Committees: Audit (Chair) Finance | ||||||||||
Key skills and experience: • Leadership: Twice elected by fellow partners to serve as Chairman and CEO of Deloitte & Touche LLP’s audit and enterprise risk services practice in the U.S., overseeing all • Financial expertise: Gained comprehensive public accounting experience at the highest level and substantial financial expertise over his 40 year career at Deloitte & Touche and as the lead audit partner for several of its largest clients, as well as through serving as a Trustee of the Goldman Sachs Trust. • Risk management: Developed a deep understanding of vertical and horizontal risk exposures – within companies and across industries – through providing enterprise risk services. Also led Deloitte & Touche through assessments of its own audit risk exposures. • Strategic planning: As a member of Deloitte’s Board of Directors and Career highlights: • Deloitte & Touche LLP, the accounting, auditing and risk advisory subsidiary of Deloitte LLP ¡ Chairman and Chief Executive Officer (2001-2005 and 2012-2014) ¡ Member, Deloitte LLP Board Other public company boards: Goldman Sachs Trust (since 2015) |
9
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Limiting service on other boards
Based on the evolving role of directors and the need to devote sufficient time to fulfill their responsibilities effectively, the Board has adopted a policy that a Director who is an executive officer of a public company should serve on no more than two public company boards, and other Directors should serve on no more than four public company boards.
10
Verizon 2022 Proxy Statement
Proxy summary |
| Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Board meetings and executive sessions
In 2021, our Board of Directors held 11 meetings, including 6 regularly scheduled meetings and 5 special meetings. Our Board met in virtual-only format, as well as in hybrid format, with safety measures in place for those attending in person, allowing for in-person interaction while retaining the flexibility to adapt to continually evolving COVID-19 pandemic circumstances and protocols in 2021.
No incumbent Director attended fewer than 75% of the total number of meetings of our Board and the committees to which the Director was assigned in 2021. Directors standing for re-election are expected to attend the annual meeting of shareholders. In 2021, all nine Directors standing for re-election attended the annual meeting, which was conducted in a virtual-only format.
The Corporate Governance Guidelines require the independent Directors to meet in executive session without any members of management present at least twice a year to review and evaluate the performance of the Board and to evaluate the performance and approve the compensation of the CEO. In practice, our Board typically meets in executive session during each regular Board meeting.
Our Board of Directors has established four standing committees: the Audit Committee, the Corporate Governance and Policy Committee, the Finance Committee, and the Human Resources Committee. Each committee has a written charter that defines its specific responsibilities. The chair of each committee approves the agenda and materials for each meeting. Each committee has the authority to retain independent advisors to assist it in carrying out its responsibilities.
Our committee meetings are not held concurrently, which enables our Directors to sit on multiple committees. Our newly appointed Directors also attend all committee meetings for a period prior to being appointed to any particular committee, which gives them a broad-based introduction to the Company and allows them to understand the inner workings of all committees.
Where to find more information
You can find information about Verizon’s Directors, Board committees and a video from our Lead Director on the Corporate Governance section of our website at www.verizon.com/about/investors/corporate-governance. You can also access Verizon’s Corporate Governance Guidelines, Code of Conduct and other corporate governance materials, including Verizon’s certificate of incorporation, bylaws, committee charters and policies at that site. You can request copies of these materials from the Assistant Corporate Secretary at the address given under “Contacting us.”
In addition, you can access all of Verizon’s ESG reporting, including our ESG Report, TCFD Report, Transparency Reports, Political Engagement Reports and EEO-1 Report, as well as key company policies, through our ESG Resources Hub at www.verizon.com/about/investors/reporting.
Beyond the boardroom
Engagement outside of Board meetings provides our Directors with additional insight into our business and our industry, and gives them valuable perspectives on the performance of our Company, the Board, our CEO and other members of senior management, and on the Company’s strategic direction.
11
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Audit Committee
12
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Finance Committee
Key responsibilities and activities • Monitor Verizon’s capital needs and financing arrangements and ability to access the • Monitor expenditures under the annual capital plan approved by our Board • Review Verizon’s policies and strategies for
• Review Verizon’s insurance and self-insurance programs • Oversee the investment of pension assets and the funding of pension and other postretirement benefit obligations | Members* Mark Bertolini (Chair) Roxanne Austin Clarence Otis, Jr. Carol Tomé Gregory Weaver * Vittorio Colao served on the Committee until February 13, 2021. 2021 meetings 6 | |||
Human Resources Committee | ||||
Key responsibilities and activities • Oversee the development of Verizon’s executive compensation program and policies • Approve corporate goals relevant to the CEO’s compensation • Evaluate the CEO’s performance and recommend his compensation to the Board • Review and approve compensation and benefits for selected senior managers • Consult with the CEO on talent development • Oversee succession planning and assignments to key leadership positions • Oversee human capital management, including with respect to employee diversity, equity and inclusion, talent acquisition, retention and development, employee engagement, pay equity and corporate culture • Review and make determinations under Verizon’s clawback policies • Review the impact of Verizon’s executive compensation policies and practices, and the performance metrics underlying the compensation program, on Verizon’s risk profile • Review and recommend non-employee Director compensation | Members Daniel Schulman (Chair) Mark Bertolini Melanie Healey Clarence Otis, Jr. Rodney Slater 2021 meetings 7 | |||
13
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Board and committee assessments
Our Board conducts a comprehensive annual assessment to enhance the effectiveness of the Board and its committees and to continue to reflect evolving best practices in their processes. While the assessment process is generally led by the Lead Director, the Board periodically engages a third-party consulting firm to bring an outside perspective to the process. As part of this robust assessment, each Director completes a detailed written questionnaire designed to elicit suggestions for improving Board and committee effectiveness and feedback on a range of issues, including Board leadership, culture, purpose and strategy, composition and structure and risk management. In addition, the Lead Director or the third-party consulting firm conducts individual interviews with each of the independent Directors to discuss these topics, among others. The Board discusses the feedback received from the questionnaires and interviews during an evaluation session facilitated by the Lead Director. The evaluation for 2021 was conducted by the Lead Director and concluded that the Board and its committees are operating effectively. The recommendations to further enhance Board effectiveness, which we addressed, include continued focus on strategic oversight, including 5G measures of success, as well as the development of Verizon’s next generation of leaders.
In addition to annual assessments, the Board evaluates and modifies its oversight of Verizon’s operations on an ongoing basis. During their executive sessions, the independent Directors consider agenda topics that they believe deserve additional focus and raise new topics to be addressed in future meetings.
The Corporate Governance and Policy Committee annually appraises the framework for our Board and committee assessment processes.
Board and committee assessment process | ||||||||||||||||||||
Feedback solicited Online questionnaire on a range of topics relating to enhancing Board effectiveness | One-on-one Candid, one-on-one discussions between the Lead Director and Directors to elicit additional feedback | Reporting back A summary of the assessment results provided to the Board | Closed session discussion Closed session discussion of the assessment results facilitated by the Lead Director | Feedback Policies and practices updated as appropriate to address any suggestions or enhancements per the assessment | ||||||||||||||||
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Director orientation and continuing education
We provide our Directors with comprehensive orientation and education programs to promote a deep understanding of issues affecting our business and industry, help Directors stay current and knowledgeable about the Company’s business and its competitive and technology landscape, and support Directors in performing their oversight duties.
New Director orientation. When a new Director joins the Board, we conduct an orientation program that includes, among other things, a review of the Company’s purpose, business strategy and operations, technology, financial condition, legal and regulatory framework and other relevant topics.
Director continuing education. We support current Directors in their ongoing learning by providing continuing education opportunities and programs. These programs include presentations by thought leaders and industry experts, formal education sessions, meetings with management subject matter experts, participation in industry forums and site visits.
14
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
All of our Directors have deep experience and expertise in strategic planning and execution. The Board engages Verizon’s senior leaders in robust discussions about strategic goals and challenges them to execute on the strategic plan, address emerging challenges and disruptions, and promote innovation. In addition to an annual strategy retreat, strategy is allocated substantial time on the agenda for each regular Board meeting. During these reviews, the Board engages with senior management regarding the competitive landscape, operational objectives and challenges and regulatory developments.
While senior management has primary responsibility for managing business risks, our Board of Directors is responsible for risk oversight. The Board works with senior management to develop a comprehensive view of Verizon’s key short- and long-term business risks. Verizon has a formalized business risk management reporting process that is designed to provide visibility to the Board about critical risks and risk mitigation strategies. Through its oversight role, the Board sends a message to management that risk management is not an impediment to the conduct of business, but is instead an integral component of strategy, culture and business operations.
The Board of Directors oversees the management of risks inherent in the operation of Verizon’s businesses and the implementation of its strategic plan by using several different levels of review. The Board addresses the primary risks associated with Verizon’s business units and corporate functions in its operations reviews of those units and functions. Further, the Board reviews the risks associated with Verizon’s strategic plan throughout the year.
In addition, each of our Board committees oversees the management of risks that fall within that committee’s areas of responsibility. In performing this function, each committee has full access to management and may engage advisors.
Enterprise risk management program. The Audit Committee oversees the operations of Verizon’s enterprise risk management program, which identifies the primary risks to Verizon’s business, including risks related to cybersecurity, data privacy and security, and the Company’s supply chain. The Audit Committee periodically monitors and evaluates the primary risks associated with particular business units and functions. As part of Verizon’s annual enterprise risk assessment process, the Audit Committee reviews key business risks with the Chief Financial Officer and the Senior Vice President of Internal Audit. These risks inform Board and Audit Committee discussion topics throughout the year.
In addition, the Audit Committee works with Verizon’s Senior Vice President of Internal Audit, who helps identify, evaluate and implement risk management controls and methodologies to address identified risks and who functionally reports directly to the Committee. The Committee routinely meets privately with representatives from the independent registered public accounting firm, the Senior Vice President of Internal Audit, and the Chief Administrative, Legal and Public Policy Officer.
Strategic crisis management. In order to position Verizon leadership and the Board to respond to strategic risks and protect Verizon’s core assets in a potential crisis, the Company maintains a Strategic Crisis Management Program. The Program defines clear roles and responsibilities in dealing with various potential crises and outlines a process to make decisions and implement appropriate actions on a timely basis. Through the Program, the Verizon Strategic Crisis Leadership Team is positioned to assume executive ownership of strategic crisis events through drills and scenario-based training. The Program also includes employee crisis awareness training in order to encourage employees across the Company to quickly identify and report circumstances or events that could develop into a strategic crisis so that our leadership team can take appropriate steps in response. In addition, Verizon’s Board maintains a Board Crisis Response Plan, which is a structured plan to be used in connection with any crisis that could have a significant strategic impact on the Company’s brand, reputation, finances or legal, political or regulatory position – providing a framework for appropriate Board oversight and assessment of the response to a crisis, while allowing the necessary flexibility to address the different types of crises that might arise.
Financial risk and capital allocation. The Finance Committee assists our Board in its oversight of financial risk management. In performing this function, the Finance Committee monitors Verizon’s capital needs and financing plans and oversees the strategy for managing risks related to currency, interest rate and renewable energy exposures. The Finance Committee reviews and approves the Company’s derivatives policy and monitors the use of derivatives. The Finance Committee also reviews Verizon’s pension and other postretirement benefit obligations, as well as its insurance and self-insurance programs.
15
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Oversight of ESG strategy and risks
Our Board recognizes that operating responsibly – minimizing the environmental impact of our operations, protecting the privacy of our customers’ information and respecting human rights by creating an environment of respect, integrity and fairness for our employees and customers wherever we do business – is fundamental to the long-term success of our Company. The Corporate Governance and Policy Committee oversees corporate responsibility and sustainability. Verizon has a Chief ESG Officer dedicated to enhancing the Company’s sustainability reporting and stakeholder engagement on environmental, social and governance issues that align with Verizon’s core business strategy. The Chief ESG Officer heads a cross-functional team that focuses on strategic areas including governance, reporting, human rights, environmental sustainability and digital trust and safety and also oversees Verizon’s efforts to deliver on its ESG commitments. The Chief ESG Officer regularly provides the Corporate Governance and Policy Committee with updates on the Company’s ESG priorities, commitments and reporting.
Environmental sustainability and climate. To address climate-related risks, Verizon is upgrading and hardening our infrastructure to be prepared for a changing climate, improving energy efficiency across our networks and facilities, making substantial investments in renewable energy and developing solutions to help our customers to reduce their carbon footprints. We have announced science-based emissions reduction targets for our Scope 1, 2 and 3 emissions and have set ambitious goals to source or generate renewable energy equivalent to 50% of our total annual electricity consumption by 2025 and to achieve net zero operational emissions (Scope 1 and 2) by 2035. The Executive Climate Oversight Committee, composed of Verizon’s Chief Financial, Chief Administrative, Chief ESG and Chief Sustainability Officers, monitors Verizon’s progress on these initiatives and commitments and recommends changes or enhancements to our climate strategy. Representatives from the Strategy, Network, Fleet, Global Real Estate, Treasury, Sustainability and ESG organizations report to the committee on climate-related issues and initiatives that fall within their responsibilities. The Chief ESG Officer periodically updates the Corporate Governance and Policy Committee on the issues considered by the committee, the Company’s progress in meeting its climate-related commitments, and any significant developments relating to the Company’s strategy for managing climate-related risks.
Each committee of the Board oversees the management of the specific risks related to our environmental sustainability strategy and the transition to a low carbon economy that fall under the committee’s area of responsibility:
Audit Committee: Environmental and climate-related risks discussed during annual business risk reviews with the Audit Committee include operational and financial risks relating to energy management and our renewable energy and carbon neutral commitments, maintaining network reliability during catastrophic and weather-related events, and the impacts of possible laws or regulations that seek to mitigate climate change.
Corporate Governance and Policy Committee: The Corporate Governance and Policy Committee oversees Verizon’s progress on meeting our environmental sustainability commitments.
Finance Committee: The Finance Committee oversees the strategy for managing risks related to Verizon’s renewable energy exposure through renewable energy purchase agreements, as well as the Company’s green financing strategy.
Human Resources Committee: To motivate management to be good stewards of our planet and reduce the environmental impact of our operations, the Human Resources Committee has included a carbon intensity reduction target as one of the performance measures in the Short-Term Incentive Plan (Short-Term Plan) since 2014.
Data privacy and cybersecurity. Protecting the privacy of our customers’ information and the security of our systems and networks has long been and will continue to be a priority at Verizon. The Board is committed to maintaining strong and meaningful privacy and security protections for our customers’ information. The Audit Committee has primary responsibility for overseeing Verizon’s risk management programs relating to data protection and privacy and cybersecurity. The Audit Committee also monitors Verizon’s compliance in the areas of data protection and privacy.
Data protection and privacy. Verizon has technical, administrative and physical safeguards in place to help protect against unauthorized access to, use or disclosure of customer information and data we collect and store. Verizon has a dedicated Chief Privacy Officer whose team advises the business on privacy risks and assesses the effectiveness of privacy controls. The Chief Privacy Officer annually briefs the Audit Committee on data privacy risks and mitigating actions.
Cybersecurity. To more effectively address the cybersecurity threats posed today, Verizon has a dedicated Chief Information Security Officer whose team is responsible for leading enterprise-wide information security strategy, policy, standards, architecture and processes. Verizon’s comprehensive information security program includes, among other aspects, vulnerability management, antivirus and malware protection, file integrity monitoring, encryption and access control. The Chief Information Security Officer leads an annual review and discussion with the full Board dedicated to Verizon’s cyber risks and threats and cyber protections and provides updates throughout the year, as warranted.
16
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Responsible business. Verizon’s Responsible Business Council, chaired by the CEO and composed of members of the senior leadership team, oversees the integration of responsible practices as a core operating principle. At least annually, the Chief Corporate Social Responsibility Officer reports to the Board on the Council’s activities and Verizon’s community and social impact initiatives.
Current policy issues and corporate reputation. Companies in our industry and beyond are facing challenges that have impacted their reputations and brought adverse attention and action by consumers, regulators, and shareholders. The Corporate Governance and Policy Committee has primary responsibility for overseeing the Company’s handling of business and reputational risks relating to Verizon’s position and engagement on important public policy issues, as well as individual events and incidents that may affect the Company’s reputation. Each year, Verizon’s Chief Administrative, Legal and Public Policy Officer updates the Committee on the current policy issues facing the Company that may generate publicity and impact corporate reputation. Through this annual briefing, the Committee reviews and discusses with management the most pressing known reputational issues and the Company’s position on each issue, as well as the processes in place to anticipate potential developments in each of the identified areas and to quickly respond to any such developments in a timely manner. Outside the regular meeting cycle, management makes sure that the Board is informed of current developments that may pose reputational risks to the industry or the Company.
Political activities and lobbying. Verizon adheres to the highest ethical standards when engaging in any political activity. Our political activity, including lobbying, is overseen by the Corporate Governance and Policy Committee, which receives a comprehensive briefing from the Chief Administrative, Legal and Public Policy Officer on these activities at least annually. Moreover, Verizon’s political activity is subject to robust internal controls. The Code of Conduct requires that all lobbying activities on behalf of Verizon be authorized by public policy or legal personnel. Corporate policy and training materials provide guidance to employees regarding legal requirements in connection with lobbying activities.
Verizon understands that transparency regarding our political activity is critical to maintaining the trust of our stakeholders. We publish a political engagement report on our corporate website that is updated twice a year that lists all political action committee contributions and corporate political contributions. Our report also discloses our Public Policy organization’s memberships in trade associations and issue advocacy organizations for which our support exceeds $50,000 annually. Verizon supports these organizations for a number of reasons, including to reflect our interest in the community, to acquire valuable industry and market expertise, and to support specific strategic policy and business goals and interests. These groups often have a diversity of members, interests and viewpoints that do not necessarily reflect Verizon’s beliefs or priorities and we may not always agree with all of the positions of each organization or its members. When we disagree with a position of an organization we support, we communicate our concerns through the senior executives who interact with these organizations. Verizon also takes these differences under consideration when determining whether support of an organization is, on balance, in the best interests of the Company and its stakeholders.
Human rights. As expressed in its Human Rights Statement, Verizon is committed to operating with respect for internationally recognized human rights. We have a dedicated Business and Human Rights Program that works to embed human rights considerations into responsible business decision-making processes across the Company. Our human rights efforts are overseen by the Corporate Governance and Policy Committee.
Anti-corruption. Verizon has a robust anticorruption program to comply with applicable anticorruption rules, including the Foreign Corrupt Practices Act and the U.K. Bribery Act. As part of this program, the Audit Committee receives annual reports summarizing the Company’s continued compliance with applicable anticorruption rules. Every two years, we review and assess our anti-corruption program with the goal of finding areas for improvement. This process is done under the direction of our Chief Compliance Officer, who reports the findings to the Audit Committee.
Oversight of human capital management
Oversight of human capital management, including culture and employee engagement, diversity, equity and inclusion and talent acquisition and development, historically has been conducted by the full Board, as well as the Human Resources Committee. In 2021, the Board amended the Human Resources Committee Charter to expressly delegate to the Committee oversight responsibilities in relation to human capital management.
Culture and employee engagement. Our Board views our employees as one of Verizon’s most critical assets and regularly receives briefings from the CEO on initiatives to strengthen our company culture and encourage employee engagement. The CEO reviews with the Board the results of the “Pulse” surveys completed by employees across the Company. Periodically, our Directors attend employee town halls and participate in leadership forums with employees.
17
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Diversity, equity and inclusion. Verizon is committed to creating a collaborative, inclusive, equitable and diverse environment – within Verizon, with our customers and among our business partners and suppliers. The Board views this commitment as a business imperative and a competitive advantage. To promote diversity in our workforce and encourage the contribution of diverse business partners to our success, the Human Resources Committee has included diversity targets as performance measures in the Short-Term Plan for over 20 years. The Chief Human Resources Officer reviews diversity representation and initiatives with the Committee at least annually.
Succession planning and talent development. Our Board recognizes that one of its most important duties is to promote continuity in Verizon’s senior leadership by overseeing the development of executive talent and planning for the efficient succession of the CEO. Our Board has delegated primary oversight responsibility for succession planning to the Human Resources Committee, which oversees assignments to key leadership positions. The Human Resources Committee reports on its activities to the full Board, which addresses succession planning during executive sessions that typically occur in connection with each regularly scheduled meeting.
To align the succession planning and management development process with Verizon’s strategic objectives, the Board and Human Resources Committee regularly consult with the CEO on Verizon’s organizational needs and competitive challenges, the potential of key managers, and plans for future developments and emergency situations. As part of this process, the Board and the Human Resources Committee also seek input from the Chief Human Resources Officer, as well as advice on related compensation issues from the Human Resources Committee’s independent compensation consultant.
Our Board generally conducts an in-depth review of senior leader development and succession planning at least twice a year. Led by the CEO and the Chief Human Resources Officer, this review addresses Verizon’s management development initiatives, assesses senior management resources, and identifies individuals who should be considered as potential future senior executives.
Our goal is to develop well-rounded, experienced and diverse senior leaders. High potential executives are challenged regularly with additional responsibilities, new positions or promotions to expose them to our diverse operations. These individuals are often positioned to interact more frequently with the Board, both in full Board meetings and in less formal settings and small groups, so the Directors can get to know and assess them.
Employee health and safety. Verizon is committed to maintaining a safe workplace and environmentally responsible work practices, and we expect our suppliers to share that commitment. At least annually, the Chief Human Resources Officer briefs the Human Resources Committee on the Company’s health and safety protocols, incidents involving employees and suppliers, and actions that management is taking to limit these risks.
Compensation risk. The Human Resources Committee considers the impact of our executive compensation program and the incentives created by compensation awards on Verizon’s overall risk profile. It also oversees management’s annual assessment of compensation risk arising from Verizon’s compensation policies and practices. This annual assessment is conducted by members of management including the Senior Vice President of Internal Audit and the Corporate Secretary. The assessment includes a review of the features and characteristics of Verizon’s compensation policies and programs, the performance metrics under the Short- and Long-Term Incentive Plans and the process for calculating and approving adjustments that are part of the plan, as well as the approval processes for compensation programs and related payouts. The assessment also reviews governance oversight at the Committee and Board level, Code of Conduct provisions and mandatory training programs that reinforce policies that mitigate risk, and performance metrics and measurement periods that are aligned with Verizon’s business strategy.
Based on management’s review, Verizon has concluded that our compensation policies and procedures are not reasonably likely to have a material adverse effect on Verizon because they are appropriately structured and discourage employees from taking excessive risks.
Business conduct and ethics. We are committed to operating with the highest level of integrity, responsibility and accountability. To that end, we have adopted a Code of Conduct that applies to all employees, including the CEO, the Chief Financial Officer and the Controller. The Code of Conduct describes each employee’s responsibility to conduct business with the highest ethical standards and provides guidance about preventing, reporting and remediating potential compliance violations in key areas. Verizon thoroughly investigates all claims of misconduct. Various types of cases are reported to the Chief Compliance Officer, who discusses the most serious Code violations with the Audit Committee at least annually.
18
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Directors are expected to act in the spirit of the Code of Conduct, and to comply with the specific ethical provisions of the Corporate Governance Guidelines. Our Board is strongly predisposed not to waive any of these business conduct and ethics provisions for executive officers or Directors. In the unlikely event of a waiver, we will promptly disclose the Board’s action on our website.
Related person transactions. The Board has adopted the Related Person Transaction Policy that is included in the Guidelines. The Corporate Governance and Policy Committee reviews transactions between Verizon and any of our Directors or executive officers or members of their immediate families to determine if any participants have a material interest in the transaction. If the Committee determines that a material interest exists, based on the facts and circumstances of each case, the Committee may approve, disapprove, ratify or cancel the transaction or recommend another course of action. Any Committee members who are involved in a transaction under review do not participate in the Committee’s deliberations. During 2021, there were no related person transactions required to be disclosed in this proxy statement.
Our approach to shareholder engagement
We believe that a robust shareholder outreach program is an essential component of maintaining our strong corporate governance practices. Ongoing communication with our investors helps our Board and senior management gather useful feedback on a wide range of topics. In our discussions with investors, we seek their input on a variety of corporate governance, compensation and ESG topics that may impact our business or reputation. We strive for a collaborative approach with investors to solicit and understand a variety of perspectives. These engagements include the participation of our independent Lead Director, Clarence Otis, Jr., or other Directors, when requested and appropriate. Shareholder feedback is regularly summarized and shared with our Board.
In 2021, topics covered in engagement included:
Environmental • Climate change – net zero emission plan • Device and e-waste recycling • Network reliability and resilience | Social • Cybersecurity • Digital inclusion • Human capital, including diversity, equity and inclusion • Supply chain | Governance • Board diversity and skills • Business ethics • Executive compensation • Human rights • Political engagement | Disclosure • SASB industry standard • TCFD, including scenario analyses • Human capital metrics • ESG data index |
In addition to our regular shareholder engagement, in 2021, our Chief Financial Officer and our Corporate Secretary participated in calls with key investors to discuss our growth strategy and its relationship to our Board composition and refreshment plans. Our Chief Financial Officer also hosted a special engagement event focused on climate featuring senior leaders from the Network, Supply Chain, Treasury and ESG organizations for our 50 largest investors.
Also in 2021, our Lead Director, Clarence Otis, Jr., discussed corporate purpose, decisions about when to speak on social issues, Board oversight of human capital management, and Board composition and refreshment in a video on the Corporate Governance section of our website at www.verizon.com/about/investors/corporate-governance.
Verizon’s dedicated ESG team focuses on stakeholder engagement and decision-useful reporting in strategic areas including governance, human rights, environmental sustainability and digital trust and safety and also oversees Verizon’s efforts to deliver on its ESG commitments. Over the past two years, in response to feedback from our investors, we have aligned our ESG reporting with the Sustainability Accounting Standards Board standards for the telecommunications industry and the recommendations of the Task Force on Climate-Related Financial Disclosures. We strive to make it easy for shareholders to learn about our positions and progress on the issues that matter to them. To that end, we have created an ESG Resources Hub on our Investor Relations website at www.verizon.com/about/investors/reporting that houses all of our ESG reporting and policies.
19
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
2021 annual ESG reporting cycle
Communicating with our Directors
Our Board of Directors believes that communication with shareholders and other interested parties is an important part of the governance process, and has adopted the following procedure to facilitate this communication.
How to contact the Board
Any shareholder or interested party may communicate directly with our Board, any committee of our Board, any individual Director (including the Lead Director and the committee chairs) or the non-employee Directors as a group, by writing to:
Verizon Communications Inc.
Shellye Archambeau
M. Frances Keeth
Roxanne Austin
Independent Director since: 2013
Age: 59
Committees:
Audit
Corporate Governance and Policy (Chair)
Independent Director since: 2020
Age: 61
Committees:
Audit
Finance
Key skills and experience: • Leadership: Highly regarded and accomplished executive with over 30 years of experience building and scaling consumer and B2B businesses in the technology industry. As CEO of MetricStream, led the company’s transformation into a leader in Governance, Risk and Compliance solutions. • Marketing: Served as Chief Marketing Officer at two public companies (Loudcloud and NorthPoint Communications), leading the design and implementation of all sales and marketing strategies and driving revenue growth. As President of Blockbuster.com, launched the entertainment retailer’s first online presence. • Risk management: Acquired significant expertise with integrated enterprise risk management, regulatory compliance functions and quality, vendor and audit management software solutions across a wide array of industries during her tenure at MetricStream, as well as through service on the audit committees of Verizon, Okta and Arbitron. • Technology: Gained valuable experience developing and marketing emerging technology applications and solutions, including internet infrastructure, cloud-based and identity security services, business software platforms, e-commerce and digital media. Career highlights: • MetricStream Inc., a leading provider of governance, risk, compliance and quality management ¡ Chief Executive Officer (2002-2018) • Executive Positions at Loudcloud, Inc., NorthPoint Communications, Blockbuster Inc. and IBM (domestic and international) (1984-2002) Other public company boards: Nordstrom, Inc. (since 2015) Okta, Inc. (since 2018) Roper Technologies, Inc. (since 2018) | Key skills and experience: • Leadership: Seasoned leader who served as CEO of Move Networks, President and COO of DIRECTV, and CFO of Hughes Electronics. Named 2018 Director of the Year – Corporate Leadership and Service by the Forum for Corporate Directors and one of the most influential directors in the board room by the National Association of Corporate Directors in 2013. Serves as co-chair of the annual Corporate Governance Conference at Northwestern’s Kellogg School of Management. • Cybersecurity: Acquired significant cybersecurity experience through her extensive management and operating roles in a range of technology industries, including service as a director of CrowdStrike, a leader in cloud-delivered endpoint protection. • Financial expertise: Developed a comprehensive background in finance and accounting as a public company audit committee member, CFO of Hughes Electronics and a partner at Deloitte & Touche LLP. Chairs the U.S. Mid-Market Advisory Committee of EQT Partners. • Strategic planning: Oversaw a dramatic turnaround of the business within one year of her arrival at DIRECTV, with cash flow increasing from negative $400 million annually to cash flow positive by $400 million, and revenue increasing by 40%. Overhauled customer service at DIRECTV, resulting in the company winning J.D. Power’s award ranking #1 in customer satisfaction. Career highlights: • President and Chief Executive Officer of Austin Investment Advisors, a private investment and consulting firm (2003-present) • President and Chief Executive Officer of Move Networks, Inc., an IP-based television delivery service (2009-2010) • President and Chief Operating Officer of DIRECTV, Inc., a digital television entertainment service (2001-2003) • Chief Financial Officer and Various Executive Positions at Hughes Electronics Corporation (1993-2001) • Audit Partner and Various Audit Positions at Deloitte & Touche LLP (1983-1993) Other public company boards: Abbott Laboratories Inc. (since 2000)* AbbVie, Inc. (since 2013) CrowdStrike Holdings, Inc. (since 2018) Freshworks Inc. (since September 2021) Teledyne Technologies Incorporated (2006-April 2021) Target Corporation (2002-2020) Ericsson (2008-2016) * Ms. Austin will not stand for re-election to the Abbott Laboratories Board of Directors at the end of her current term expiring at the April 29, 2022 annual shareholders meeting. |
4
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Mark Bertolini | Melanie Healey | |||||||||
Independent Director since: 2015 Age: 65 Committees: Finance (Chair) Human Resources | Independent Director since: 2011 Age: 60 Committees: Corporate Governance and Policy Human Resources | |||||||||
Key skills and experience: • Leadership: Recognized as an accessible, forward-thinking and solutions-oriented leader. Transformed Aetna from a traditional health insurance company to a consumer-oriented health care company focused on delivering holistic integrated care to local communities and serving over 46 million people. • Financial expertise: Developed deep financial and risk management expertise in his executive roles at Aetna and as a Board member of MassMutual Life Insurance Company, a leading life insurance mutual company. Following his service on the Board of Bridgewater Associates, the world’s largest hedge fund, named Co-Chief Executive Officer of Bridgewater in 2022. • Regulatory/public policy: A national health care thought leader with extensive regulatory and public policy experience. Successfully navigated changes in the health insurance marketplace resulting from the Affordable Care Act and led Aetna through antitrust reviews of various acquisitions and proposed acquisitions. • Strategic planning: Led Aetna through a period of strategic and regulatory transformation and domestic and international growth through strategic acquisitions and dispositions, culminating in the $78 billion acquisition of Aetna by CVS completed in 2018. Career highlights: • Co-Chief Executive Officer of Bridgewater Associates, LP, a global investment management firm (January 2022-present) • Aetna Inc., a multi-national, Fortune 100 diversified healthcare benefits company ¡ Chairman (2011-2018) ¡ Chief Executive Officer (2010-2018) ¡ President (2007-2010) ¡ Other Executive Positions (2003-2007) • Executive Positions at Cigna, NYLCare Health Plans and SelectCare, Inc. Other public company boards: CVS Health Corporation (2018-2020) | Key skills and experience: • Leadership: Accomplished, consumer-focused executive with substantial global experience and a track record of delivering growth, driving operational improvements and launching successful product innovations over a 33-year career at 3 global iconic consumer product brand companies, including leading a global business for 6 years. • Consumer/B2B/retail: Gained deep and valuable branding, distribution and operating experience with consumer wellness products on a global scale over a long career at 3 different multi-national organizations in the consumer goods industry (Procter & Gamble, Johnson & Johnson and S.C. Johnson & Sons). Continues to focus on the consumer/retailing sector through service on the Target board of directors and on a globally recognized consumer and B2B brand through service on the board of Hilton, which has over 6,000 properties in over 100 countries and territories. • Marketing: Brings a multi-cultural and multi-national perspective acquired from working 18 years internationally to corporate strategy with respect to brand building, new product and commercial innovation and the consumer experience, as well as experience with managing large and complex marketing budgets. • Strategic planning: As Group President of North America at Procter & Gamble, oversaw multi-year strategic planning for the largest division of the company, with over $32 billion in annual sales, and reversed a decline in sales after assuming that role. Career highlights: • The Procter & Gamble Company, a leading provider of branded consumer packaged goods ¡ Group President (2007-2015) ¡ Other Executive Positions (1990-2015) • Johnson & Johnson (1986-1990) • S.C. Johnson & Sons (1983-1986) Other public company boards: Hilton Worldwide Holdings Inc. (since 2017) PPG Industries, Inc. (since 2016) Target Corporation (since 2015) |
5
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Laxman Narasimhan | Clarence Otis, Jr. (Lead Director)
| |||||||||
| Independent Director since: 2021
Committees: Audit Corporate Governance and Policy | Independent Director since: 2006
Committees: Audit Finance Human Resources | ||||||||
Key skills and experience: • Leadership: Insightful and strategic leader with wide experience across the consumer goods sector and a proven track record in developing purpose-led brands, including as chief executive of Reckitt Benckiser Group Plc, a FTSE 12 listed British multinational global consumer health, hygiene and nutrition company. Credited with improving sales and profit while managing approximately $18 billion in revenue at businesses across 100 countries and 125,000 employees as CEO of PepsiCo’s Latin America, Europe and Sub-Saharan Africa operations. • Consumer/B2B/retail: Provides valuable experience and thought leadership in complex global consumer-facing businesses as a result of a career approaching 30 years in the space. Prior to joining Reckitt Benckiser and PepsiCo, spent 19 years at McKinsey & Company, focusing on its consumer, retail and technology practices in the United States, Asia and India. • Risk management: Developed significant risk management experience, including supply chain risk management experience, while piloting Reckitt Benckiser through the supply chain disruptions of the COVID-19 pandemic. • Strategic planning: Articulated corporate purpose and drove strategic change while transitioning into the leadership role at Reckitt Benckiser during the COVID-19 pandemic. Eliminated complexity and simplified operations in order to remain agile and manage surging demand for certain consumer products during the pandemic. Career highlights: • Chief Executive Officer of Reckitt Benckiser Group Plc, a global consumer-goods company (2019-present) • PepsiCo, Inc., a leading global food and beverage company
¡ Chief Executive Officer, Latin America, Europe and ¡ Other Executive Positions (2012-2017) • McKinsey & Company (1993-2012) Other public company boards: Reckitt Benckiser Group Plc (since 2019) | Key skills and experience: • Leadership: Led Darden Restaurants, Inc., the largest company-owned and operated full-service restaurant company in the world, as CEO for 10 years, achieving sales growth of over 75% during the period. Known as a purpose-driven and values-based leader, with Darden being recognized by Fortune magazine for four consecutive years during his tenure as one of its 100 Best Companies to Work For. • Consumer/B2B/retail: Brings deep and valuable insights into consumer services and retail operations gleaned from his experience leading a Fortune 500 company that owned well-known national consumer brands including Olive Garden, LongHorn Steakhouse, Red Lobster and Capital Grille. Further consumer and retail expertise through board position at VF Corporation, which owns well-known national brands including Timberland and North Face. • Financial expertise: Gained substantial financial expertise through, among other roles, investment banking positions of increasing seniority over 12 years, the CFO role at Darden, serving as a Director of the Federal Reserve Bank of Atlanta and as trustee or director of mutual funds pursuing a wide array of investment strategies. • Risk management: Acquired significant expertise with financial risk assessment and enterprise risk management during his career in investment banking and at Darden, as well as through his many years of service on the Federal Reserve Bank of Atlanta Board, the Audit Committees of VF Corporation and Verizon, the Investment & Capital Markets Committee of Travelers and as a Trustee of 138 funds within the MFS Mutual Fund complex. Career highlights: • Darden Restaurants, Inc. ¡ Chairman (2005-2014) ¡ Chief Executive Officer (2004-2014) ¡ Other Executive Positions (1995-2014) • Director of the Federal Reserve Bank of Atlanta (2010-2015) • Investment banker and lawyer specializing in securities and finance Other public company boards: The Travelers Companies, Inc. (since 2017) VF Corporation (since 2004) MFS Mutual Funds complex (since 2017) |
6
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Daniel Schulman | Rodney Slater | |||||||||
Independent Director since: 2018 Age: 64 Committees: Human Resources | Independent Director since: 2010 Age: 67 Committees: Corporate Governance and Policy Human Resources | |||||||||
Key skills and experience: • Leadership: Successful and dynamic leader in the fiercely competitive technology and e-commerce space with a proven track record of creating shareholder value through innovation and a focus on values at numerous companies, including PayPal, which has approximately 415 million active accounts across more than 200 markets, Priceline, and Virgin Mobile USA. • Cybersecurity: Gained extensive cybersecurity and risk management experience as a director of Symantec Corporation, a global leader in cybersecurity, for nearly 20 years, including serving as the independent chairman for 6 years. • Strategic planning: Spearheaded innovation and growth at start-ups and established companies, including Priceline, where he grew annual revenues from $20 million to nearly $1 billion over two years, Virgin Mobile USA, where he successfully built a pre-paid cellphone business, American Express, where he expanded global mobile and online payment services, and PayPal, where he has achieved significant revenue growth and stock price appreciation. • Technology: Acquired significant expertise in mobile technology and digital innovation over a long career spanning the telecommunications, financial technology and e-commerce industries. Career highlights: • PayPal Holdings, Inc., a leading online payments company ¡ President and Chief Executive Officer (2015-present) ¡ President and CEO-Designee (2014-2015) • Group President of the Enterprise Group at American Express Company (2010-2014) • President of the Prepaid Group at Sprint Nextel Corporation (2009-2010) • Founding CEO of Virgin Mobile USA, Inc. (2001-2009) • President and CEO of Priceline Group, Inc. • Various Executive Positions, including President of the Consumer Markets Division, at AT&T, Inc. Other public company boards: PayPal Holdings, Inc. (since 2015) Symantec Corporation (2000-2019) FLEX LTD. (2009-2018) | Key skills and experience: • Leadership: Nationally recognized for innovative infrastructure development and forging strategic public and private partnerships. As U.S. Secretary of Transportation, oversaw national transportation policy, spearheaded several historic legislative measures, including record funding for surface transportation investment and aviation safety and security, promoted intermodal transportation systems and led effort to significantly expand high speed rail network. • Regulatory/public policy: Brings a strategic, collaborative and result-oriented approach to oversight of regulatory and public policy issues developed over his long and accomplished career in both the public and private sectors. • Risk management: Globally recognized advisor for reputational risk management, corporate compliance and emergency preparedness, having served as an independent monitor/advisor for Toyota, Takata and Fiat Chrysler as these companies worked through safety issues, and coordinated the Federal Highway Administration’s response to several major natural disasters. • Strategic planning: Implemented a visionary strategic plan for the U.S. Department of Transportation to expand its focus on safety, mobility and access, economic development and trade, the environment and national security. Developed an innovative financing and contracting program at the Federal Highway Administration that produced significant operational and cost efficiencies. Career highlights: • Partner, Squire Patton Boggs LLP, a law firm (2001 to present) • U.S. Secretary of Transportation (1997-2001) • Administrator, Federal Highway Administration (1993-1997) • Various policy positions with the State of Arkansas Other public company boards: EVgo Inc. (since July 2021) Stagwell Inc. (since August 2021) Kansas City Southern (2001-2019) Transurban Group (2009-2018) |
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Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Carol Tomé | Hans Vestberg (Chairman) | |||||||||
Independent Director since: 2021 Age: 65 Committees: Finance | Director since: 2018 Age: 56 | |||||||||
Key skills and experience: • Leadership: After being appointed CEO of UPS in June 2020, led the company through an unprecedented surge in demand for services, while improving competitiveness and reducing bureaucracy. Demonstrated strong financial leadership as CFO for over 18 years at Home Depot, with responsibility for all corporate finance matters including financial reporting, financial planning and analysis, financial operations, internal audit, investor relations and tax. Led strategic business development during a critical time for Home Depot, as well as the IT and security function. • Consumer/B2B/retail: Proven track record in growing and innovating at both consumer and B2B businesses with large geographic footprints and employee bases. Reinvigorated Home Depot’s consumer business while navigating the Great Recession and housing crisis. Championed Home Depot’s initiative designed to grow the B2B side of its business. • Financial expertise: Gained extensive and deep corporate finance expertise during her tenure at Home Depot and during her service on the Board of the Federal Reserve Bank of Atlanta, where she served as both Vice-Chair and Chair of the Board. • Strategic planning: As CEO of UPS, navigated the immense challenges and opportunities of the delivery and logistics business during the COVID-19 pandemic. Played a pivotal role in strategic business development at Home Depot as it transformed into one of the world’s largest retailers – during her tenure as CFO, Home Depot doubled sales to over $108 billion and generated a 450% increase in shareholder value. Career highlights: • Chief Executive Officer of United Parcel Service, Inc., the world’s largest package delivery company and a premier provider of global supply chain management solutions (2020-present) • The Home Depot, Inc., one of the world’s largest home improvement retailers o Executive Vice President – Corporate Services and Chief Financial Officer (2007-2019) o Chief Financial Officer (2001-2007) o Other Executive Positions (1995-2001) • Federal Reserve Bank of Atlanta o Director (2008-2013) Other public company boards: United Parcel Service, Inc. (since 2003) Cisco Systems, Inc. (2019-2020) Certain Fidelity Mutual Funds (2017) | Key skills and experience: • Leadership: Driving Verizon’s leadership position in the deployment of 5G technology and multi-access edge computing in the U.S. Built an industry-leading telecommunications software and services organization at Ericsson, one of the world’s largest telecommunications companies. Member of the Board of • Strategic planning: Implemented bold and • Technology: Gained significant expertise in mobile technology and telecommunications network architecture as Verizon’s Chief Technology Officer and over his 25-year career at Ericsson. • Telecommunications: Brings to the Board extensive operational and strategic experience and a deep understanding of the
Career highlights:
• Ericsson ¡ President and Chief Executive Officer (2010-2016) ¡ Chief Financial Officer (2007-2009) ¡ Other executive positions throughout the global operations Other public company boards: BlackRock, Inc. (since May 2021) Hexagon AB (2017-2018) |
8
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Gregory Weaver | ||||||||||
Independent Director since: 2015
Committees: Audit (Chair) Finance | ||||||||||
Key skills and experience: • Leadership: Twice elected by fellow partners to serve as • Financial expertise: Gained comprehensive public accounting experience at the highest level and substantial financial expertise over his 40 year career at Deloitte & Touche and as the lead audit partner for several of its largest clients, as well as through serving as a Trustee of the Goldman Sachs Trust. • Risk management: Developed a deep understanding of vertical and horizontal risk exposures – within companies and across industries – through providing enterprise risk services. Also led Deloitte & Touche through assessments of its own audit risk exposures. • Strategic planning: As a member of Deloitte’s Board of Directors and numerous management committees, helped shape strategic organizational priorities and relationships with regulators. Career highlights: • Deloitte & Touche LLP, the accounting, auditing and risk advisory subsidiary of Deloitte LLP ¡ Chairman and Chief Executive Officer (2001-2005 and 2012-2014) ¡ Member, Deloitte LLP Board of Directors (2006-2012) Other public company boards: Goldman Sachs Trust (since 2015) |
9
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
The membership, structure, policies and practices of our Board and its committees promote the effective exercise of the Board’s role in the governance of Verizon. In addition, our Corporate Governance Guidelines provide a framework for the Board’s operations and address key governance practices. The Corporate Governance and Policy Committee monitors best practices and developments in corporate governance, considers the views of Verizon’s shareholders, and periodically recommends changes to the Board’s policies and practices, including the Guidelines. Verizon’s governance framework provides the Board with the flexibility to select the appropriate Board leadership structure for the Company. In making this leadership structure determination, the Board considers many factors, including the specific needs of the business and the long-term interests of our shareholders. Given the dynamic and competitive environment in which Verizon operates, the Board believes that Verizon and our shareholders are best served by a Chairman who has broad and deep knowledge of our industry and the vision, energy and experience to position Verizon as the leader of transformational change in the communications ecosystem. Based on these considerations, the Board has determined that, at this time, our CEO, Hans Vestberg, is the Director best qualified to serve in the role of Chairman. To maintain an appropriate level of independent checks and balances in its governance, and consistent with the Corporate Governance Guidelines, the independent members of the Board have elected an independent Lead Director who has the responsibilities described under “Role of the Lead Director.” Clarence Otis, Jr. currently serves as Lead Director. The Lead Director and our Chairman and CEO meet and speak with each other regularly about the Company’s strategy and operations and the functioning of the Board. In addition, any shareholder or interested party may communicate directly with the Lead Director. All Directors play an active role in overseeing Verizon’s business at both the Board and committee level. Every Director is given the agenda for each Board meeting in advance and can request changes. In addition, all Directors have unrestricted access to the Chairman and the senior leadership team at all times. The Board believes that shareholders are best served by this current leadership structure because it features an independent Lead Director who provides independent and objective oversight and who can express the Board’s positions in a forthright manner, as well as independent Directors who are fully involved in the Board’s operations and decision making. | Clarence Otis, Jr. Lead Director Role of the Lead Director • Promotes a strong Board culture, including encouraging and facilitating active participation of all Directors • Approves the agenda, schedule and materials for all Board meetings, in consultation with the Chairman • Is available to advise the committee chairs in fulfilling their designated responsibilities • Acts as principal liaison with the Chairman • Chairs executive sessions, including those held to evaluate the CEO’s performance and compensation • Chairs any meeting of the Board if the Chairman is not present • Calls Board meetings and executive sessions as needed • Leads the Board’s annual self-evaluation • Oversees the process for CEO succession planning along with the Human Resources Committee • Acts as a primary point of contact for Board communication with major shareholders and other key stakeholders, as appropriate |
Limiting service on other boards
Based on the evolving role of directors and the need to devote sufficient time to fulfill their responsibilities effectively, the Board has adopted a policy that a Director who is an executive officer of a public company should serve on no more than two public company boards, and other Directors should serve on no more than four public company boards.
10
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Board meetings and executive sessions
In 2021, our Board of Directors held 11 meetings, including 6 regularly scheduled meetings and 5 special meetings. Our Board met in virtual-only format, as well as in hybrid format, with safety measures in place for those attending in person, allowing for in-person interaction while retaining the flexibility to adapt to continually evolving COVID-19 pandemic circumstances and protocols in 2021.
No incumbent Director attended fewer than 75% of the total number of meetings of our Board and the committees to which the Director was assigned in 2021. Directors standing for re-election are expected to attend the annual meeting of shareholders. In 2021, all nine Directors standing for re-election attended the annual meeting, which was conducted in a virtual-only format.
The Corporate Governance Guidelines require the independent Directors to meet in executive session without any members of management present at least twice a year to review and evaluate the performance of the Board and to evaluate the performance and approve the compensation of the CEO. In practice, our Board typically meets in executive session during each regular Board meeting.
Our Board of Directors has established four standing committees: the Audit Committee, the Corporate Governance and Policy Committee, the Finance Committee, and the Human Resources Committee. Each committee has a written charter that defines its specific responsibilities. The chair of each committee approves the agenda and materials for each meeting. Each committee has the authority to retain independent advisors to assist it in carrying out its responsibilities.
Our committee meetings are not held concurrently, which enables our Directors to sit on multiple committees. Our newly appointed Directors also attend all committee meetings for a period prior to being appointed to any particular committee, which gives them a broad-based introduction to the Company and allows them to understand the inner workings of all committees.
Where to find more information
You can find information about Verizon’s Directors, Board committees and a video from our Lead Director on the Corporate Governance section of our website at www.verizon.com/about/investors/corporate-governance. You can also access Verizon’s Corporate Governance Guidelines, Code of Conduct and other corporate governance materials, including Verizon’s certificate of incorporation, bylaws, committee charters and policies at that site. You can request copies of these materials from the Assistant Corporate Secretary at the address given under “Contacting us.”
In addition, you can access all of Verizon’s ESG reporting, including our ESG Report, TCFD Report, Transparency Reports, Political Engagement Reports and EEO-1 Report, as well as key company policies, through our ESG Resources Hub at www.verizon.com/about/investors/reporting.
Beyond the boardroom
Engagement outside of Board meetings provides our Directors with additional insight into our business and our industry, and gives them valuable perspectives on the performance of our Company, the Board, our CEO and other members of senior management, and on the Company’s strategic direction.
11
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Audit Committee
Key responsibilities and activities • Assess and discuss with management Verizon’s significant business risk exposures (including those related to cybersecurity, data privacy, data security and bribery and corruption) and oversee management’s programs and policies to monitor, assess and manage such exposures • Assess Verizon’s overall control environment, including controls related to financial reporting, disclosure, compliance and significant financial and business risks • Appoint, approve fees for, and oversee the work of the independent registered public accounting firm • Oversee financial reporting and disclosure matters • Oversee Verizon’s internal audit function • Assess Verizon’s compliance processes and programs • Review the Chief Compliance Officer’s annual report regarding anti-corruption compliance, compliance with significant regulatory obligations, export controls, and data protection • Assess policies and procedures for executive officer expense accounts and perquisites, including the use of corporate assets • Assess procedures for handling complaints relating to accounting, internal accounting controls or auditing matters The Board has determined that each of Ms. Archambeau, Ms. Austin, Mr. Narasimhan, Mr. Otis and Mr. Weaver is an audit committee financial expert. | Members Gregory Weaver (Chair) Shellye Archambeau Roxanne Austin Laxman Narasimhan Clarence Otis, Jr. 2021 meetings 11 | |||
Corporate Governance and Policy Committee | ||||
Key responsibilities and activities • Evaluate the structure and practices of our Board and its committees, including size, composition, independence and operations • Recommend changes to our Board’s policies or practices or the Corporate Governance Guidelines • Identify and evaluate the qualifications of Director candidates • Recommend Directors to serve as members of each committee and as committee chairs • Review potential related person transactions • Facilitate the annual assessment of the performance of the Board and its committees • Serve as hub for oversight of ESG, including ESG commitments, reporting and engagement, corporate responsibility and sustainability • Oversee Verizon’s position and engagement on important public policy issues, including those relating to political contributions, lobbying activities, and human rights, that may affect our business and reputation • Review the activities of Verizon’s community and social impact initiatives, including philanthropic activities | Members* Shellye Archambeau (Chair) Melanie Healey Laxman Narasimhan Rodney Slater * Vittorio Colao served on the Committee until February 13, 2021. 2021 meetings 6 | |||
12
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Finance Committee
Key responsibilities and activities • Monitor Verizon’s capital needs and financing arrangements and ability to access the capital markets • Monitor expenditures under the annual capital plan approved by our Board • Review Verizon’s policies and strategies for managing currency, interest rate, renewable energy and counterparty exposures • Review and approve Verizon’s derivatives policy and monitor the use of derivatives, including our renewable power purchase agreement strategy • Review Verizon’s insurance and self-insurance programs • Oversee the investment of pension assets and the funding of pension and other postretirement benefit obligations | Members* Mark Bertolini (Chair) Roxanne Austin Clarence Otis, Jr. Carol Tomé Gregory Weaver * Vittorio Colao served on the Committee until February 13, 2021. 2021 meetings 6 | |||
Human Resources Committee | ||||
Key responsibilities and activities • Oversee the development of Verizon’s executive compensation program and policies • Approve corporate goals relevant to the CEO’s compensation • Evaluate the CEO’s performance and recommend his compensation to the Board • Review and approve compensation and benefits for selected senior managers • Consult with the CEO on talent development • Oversee succession planning and assignments to key leadership positions • Oversee human capital management, including with respect to employee diversity, equity and inclusion, talent acquisition, retention and development, employee engagement, pay equity and corporate culture • Review and make determinations under Verizon’s clawback policies • Review the impact of Verizon’s executive compensation policies and practices, and the performance metrics underlying the compensation program, on Verizon’s risk profile • Review and recommend non-employee Director compensation | Members Daniel Schulman (Chair) Mark Bertolini Melanie Healey Clarence Otis, Jr. Rodney Slater 2021 meetings 7 | |||
13
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Board and committee assessments
Our Board conducts a comprehensive annual assessment to enhance the effectiveness of the Board and its committees and to continue to reflect evolving best practices in their processes. While the assessment process is generally led by the Lead Director, the Board periodically engages a third-party consulting firm to bring an outside perspective to the process. As part of this robust assessment, each Director completes a detailed written questionnaire designed to elicit suggestions for improving Board and committee effectiveness and feedback on a range of issues, including Board leadership, culture, purpose and strategy, composition and structure and risk management. In addition, the Lead Director or the third-party consulting firm conducts individual interviews with each of the independent Directors to discuss these topics, among others. The Board discusses the feedback received from the questionnaires and interviews during an evaluation session facilitated by the Lead Director. The evaluation for 2021 was conducted by the Lead Director and concluded that the Board and its committees are operating effectively. The recommendations to further enhance Board effectiveness, which we addressed, include continued focus on strategic oversight, including 5G measures of success, as well as the development of Verizon’s next generation of leaders.
In addition to annual assessments, the Board evaluates and modifies its oversight of Verizon’s operations on an ongoing basis. During their executive sessions, the independent Directors consider agenda topics that they believe deserve additional focus and raise new topics to be addressed in future meetings.
The Corporate Governance and Policy Committee annually appraises the framework for our Board and committee assessment processes.
Board and committee assessment process | ||||||||||||||||||||
Feedback solicited Online questionnaire on a range of topics relating to enhancing Board effectiveness | One-on-one Candid, one-on-one discussions between the Lead Director and Directors to elicit additional feedback | Reporting back A summary of the assessment results provided to the Board | Closed session discussion Closed session discussion of the assessment results facilitated by the Lead Director | Feedback Policies and practices updated as appropriate to address any suggestions or enhancements per the assessment | ||||||||||||||||
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Director orientation and continuing education
We provide our Directors with comprehensive orientation and education programs to promote a deep understanding of issues affecting our business and industry, help Directors stay current and knowledgeable about the Company’s business and its competitive and technology landscape, and support Directors in performing their oversight duties.
New Director orientation. When a new Director joins the Board, we conduct an orientation program that includes, among other things, a review of the Company’s purpose, business strategy and operations, technology, financial condition, legal and regulatory framework and other relevant topics.
Director continuing education. We support current Directors in their ongoing learning by providing continuing education opportunities and programs. These programs include presentations by thought leaders and industry experts, formal education sessions, meetings with management subject matter experts, participation in industry forums and site visits.
14
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
All of our Directors have deep experience and expertise in strategic planning and execution. The Board engages Verizon’s senior leaders in robust discussions about strategic goals and challenges them to execute on the strategic plan, address emerging challenges and disruptions, and promote innovation. In addition to an annual strategy retreat, strategy is allocated substantial time on the agenda for each regular Board meeting. During these reviews, the Board engages with senior management regarding the competitive landscape, operational objectives and challenges and regulatory developments.
While senior management has primary responsibility for managing business risks, our Board of Directors is responsible for risk oversight. The Board works with senior management to develop a comprehensive view of Verizon’s key short- and long-term business risks. Verizon has a formalized business risk management reporting process that is designed to provide visibility to the Board about critical risks and risk mitigation strategies. Through its oversight role, the Board sends a message to management that risk management is not an impediment to the conduct of business, but is instead an integral component of strategy, culture and business operations.
The Board of Directors oversees the management of risks inherent in the operation of Verizon’s businesses and the implementation of its strategic plan by using several different levels of review. The Board addresses the primary risks associated with Verizon’s business units and corporate functions in its operations reviews of those units and functions. Further, the Board reviews the risks associated with Verizon’s strategic plan throughout the year.
In addition, each of our Board committees oversees the management of risks that fall within that committee’s areas of responsibility. In performing this function, each committee has full access to management and may engage advisors.
Enterprise risk management program. The Audit Committee oversees the operations of Verizon’s enterprise risk management program, which identifies the primary risks to Verizon’s business, including risks related to cybersecurity, data privacy and security, and the Company’s supply chain. The Audit Committee periodically monitors and evaluates the primary risks associated with particular business units and functions. As part of Verizon’s annual enterprise risk assessment process, the Audit Committee reviews key business risks with the Chief Financial Officer and the Senior Vice President of Internal Audit. These risks inform Board and Audit Committee discussion topics throughout the year.
In addition, the Audit Committee works with Verizon’s Senior Vice President of Internal Audit, who helps identify, evaluate and implement risk management controls and methodologies to address identified risks and who functionally reports directly to the Committee. The Committee routinely meets privately with representatives from the independent registered public accounting firm, the Senior Vice President of Internal Audit, and the Chief Administrative, Legal and Public Policy Officer.
Strategic crisis management. In order to position Verizon leadership and the Board to respond to strategic risks and protect Verizon’s core assets in a potential crisis, the Company maintains a Strategic Crisis Management Program. The Program defines clear roles and responsibilities in dealing with various potential crises and outlines a process to make decisions and implement appropriate actions on a timely basis. Through the Program, the Verizon Strategic Crisis Leadership Team is positioned to assume executive ownership of strategic crisis events through drills and scenario-based training. The Program also includes employee crisis awareness training in order to encourage employees across the Company to quickly identify and report circumstances or events that could develop into a strategic crisis so that our leadership team can take appropriate steps in response. In addition, Verizon’s Board maintains a Board Crisis Response Plan, which is a structured plan to be used in connection with any crisis that could have a significant strategic impact on the Company’s brand, reputation, finances or legal, political or regulatory position – providing a framework for appropriate Board oversight and assessment of the response to a crisis, while allowing the necessary flexibility to address the different types of crises that might arise.
Financial risk and capital allocation. The Finance Committee assists our Board in its oversight of financial risk management. In performing this function, the Finance Committee monitors Verizon’s capital needs and financing plans and oversees the strategy for managing risks related to currency, interest rate and renewable energy exposures. The Finance Committee reviews and approves the Company’s derivatives policy and monitors the use of derivatives. The Finance Committee also reviews Verizon’s pension and other postretirement benefit obligations, as well as its insurance and self-insurance programs.
15
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Oversight of ESG strategy and risks
Our Board recognizes that operating responsibly – minimizing the environmental impact of our operations, protecting the privacy of our customers’ information and respecting human rights by creating an environment of respect, integrity and fairness for our employees and customers wherever we do business – is fundamental to the long-term success of our Company. The Corporate Governance and Policy Committee oversees corporate responsibility and sustainability. Verizon has a Chief ESG Officer dedicated to enhancing the Company’s sustainability reporting and stakeholder engagement on environmental, social and governance issues that align with Verizon’s core business strategy. The Chief ESG Officer heads a cross-functional team that focuses on strategic areas including governance, reporting, human rights, environmental sustainability and digital trust and safety and also oversees Verizon’s efforts to deliver on its ESG commitments. The Chief ESG Officer regularly provides the Corporate Governance and Policy Committee with updates on the Company’s ESG priorities, commitments and reporting.
Environmental sustainability and climate. To address climate-related risks, Verizon is upgrading and hardening our infrastructure to be prepared for a changing climate, improving energy efficiency across our networks and facilities, making substantial investments in renewable energy and developing solutions to help our customers to reduce their carbon footprints. We have announced science-based emissions reduction targets for our Scope 1, 2 and 3 emissions and have set ambitious goals to source or generate renewable energy equivalent to 50% of our total annual electricity consumption by 2025 and to achieve net zero operational emissions (Scope 1 and 2) by 2035. The Executive Climate Oversight Committee, composed of Verizon’s Chief Financial, Chief Administrative, Chief ESG and Chief Sustainability Officers, monitors Verizon’s progress on these initiatives and commitments and recommends changes or enhancements to our climate strategy. Representatives from the Strategy, Network, Fleet, Global Real Estate, Treasury, Sustainability and ESG organizations report to the committee on climate-related issues and initiatives that fall within their responsibilities. The Chief ESG Officer periodically updates the Corporate Governance and Policy Committee on the issues considered by the committee, the Company’s progress in meeting its climate-related commitments, and any significant developments relating to the Company’s strategy for managing climate-related risks.
Each committee of the Board oversees the management of the specific risks related to our environmental sustainability strategy and the transition to a low carbon economy that fall under the committee’s area of responsibility:
Audit Committee: Environmental and climate-related risks discussed during annual business risk reviews with the Audit Committee include operational and financial risks relating to energy management and our renewable energy and carbon neutral commitments, maintaining network reliability during catastrophic and weather-related events, and the impacts of possible laws or regulations that seek to mitigate climate change.
Corporate Governance and Policy Committee: The Corporate Governance and Policy Committee oversees Verizon’s progress on meeting our environmental sustainability commitments.
Finance Committee: The Finance Committee oversees the strategy for managing risks related to Verizon’s renewable energy exposure through renewable energy purchase agreements, as well as the Company’s green financing strategy.
Human Resources Committee: To motivate management to be good stewards of our planet and reduce the environmental impact of our operations, the Human Resources Committee has included a carbon intensity reduction target as one of the performance measures in the Short-Term Incentive Plan (Short-Term Plan) since 2014.
Data privacy and cybersecurity. Protecting the privacy of our customers’ information and the security of our systems and networks has long been and will continue to be a priority at Verizon. The Board is committed to maintaining strong and meaningful privacy and security protections for our customers’ information. The Audit Committee has primary responsibility for overseeing Verizon’s risk management programs relating to data protection and privacy and cybersecurity. The Audit Committee also monitors Verizon’s compliance in the areas of data protection and privacy.
Data protection and privacy. Verizon has technical, administrative and physical safeguards in place to help protect against unauthorized access to, use or disclosure of customer information and data we collect and store. Verizon has a dedicated Chief Privacy Officer whose team advises the business on privacy risks and assesses the effectiveness of privacy controls. The Chief Privacy Officer annually briefs the Audit Committee on data privacy risks and mitigating actions.
Cybersecurity. To more effectively address the cybersecurity threats posed today, Verizon has a dedicated Chief Information Security Officer whose team is responsible for leading enterprise-wide information security strategy, policy, standards, architecture and processes. Verizon’s comprehensive information security program includes, among other aspects, vulnerability management, antivirus and malware protection, file integrity monitoring, encryption and access control. The Chief Information Security Officer leads an annual review and discussion with the full Board dedicated to Verizon’s cyber risks and threats and cyber protections and provides updates throughout the year, as warranted.
16
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Responsible business. Verizon’s Responsible Business Council, chaired by the CEO and composed of members of the senior leadership team, oversees the integration of responsible practices as a core operating principle. At least annually, the Chief Corporate Social Responsibility Officer reports to the Board on the Council’s activities and Verizon’s community and social impact initiatives.
Current policy issues and corporate reputation. Companies in our industry and beyond are facing challenges that have impacted their reputations and brought adverse attention and action by consumers, regulators, and shareholders. The Corporate Governance and Policy Committee has primary responsibility for overseeing the Company’s handling of business and reputational risks relating to Verizon’s position and engagement on important public policy issues, as well as individual events and incidents that may affect the Company’s reputation. Each year, Verizon’s Chief Administrative, Legal and Public Policy Officer updates the Committee on the current policy issues facing the Company that may generate publicity and impact corporate reputation. Through this annual briefing, the Committee reviews and discusses with management the most pressing known reputational issues and the Company’s position on each issue, as well as the processes in place to anticipate potential developments in each of the identified areas and to quickly respond to any such developments in a timely manner. Outside the regular meeting cycle, management makes sure that the Board is informed of current developments that may pose reputational risks to the industry or the Company.
Political activities and lobbying. Verizon adheres to the highest ethical standards when engaging in any political activity. Our political activity, including lobbying, is overseen by the Corporate Governance and Policy Committee, which receives a comprehensive briefing from the Chief Administrative, Legal and Public Policy Officer on these activities at least annually. Moreover, Verizon’s political activity is subject to robust internal controls. The Code of Conduct requires that all lobbying activities on behalf of Verizon be authorized by public policy or legal personnel. Corporate policy and training materials provide guidance to employees regarding legal requirements in connection with lobbying activities.
Verizon understands that transparency regarding our political activity is critical to maintaining the trust of our stakeholders. We publish a political engagement report on our corporate website that is updated twice a year that lists all political action committee contributions and corporate political contributions. Our report also discloses our Public Policy organization’s memberships in trade associations and issue advocacy organizations for which our support exceeds $50,000 annually. Verizon supports these organizations for a number of reasons, including to reflect our interest in the community, to acquire valuable industry and market expertise, and to support specific strategic policy and business goals and interests. These groups often have a diversity of members, interests and viewpoints that do not necessarily reflect Verizon’s beliefs or priorities and we may not always agree with all of the positions of each organization or its members. When we disagree with a position of an organization we support, we communicate our concerns through the senior executives who interact with these organizations. Verizon also takes these differences under consideration when determining whether support of an organization is, on balance, in the best interests of the Company and its stakeholders.
Human rights. As expressed in its Human Rights Statement, Verizon is committed to operating with respect for internationally recognized human rights. We have a dedicated Business and Human Rights Program that works to embed human rights considerations into responsible business decision-making processes across the Company. Our human rights efforts are overseen by the Corporate Governance and Policy Committee.
Anti-corruption. Verizon has a robust anticorruption program to comply with applicable anticorruption rules, including the Foreign Corrupt Practices Act and the U.K. Bribery Act. As part of this program, the Audit Committee receives annual reports summarizing the Company’s continued compliance with applicable anticorruption rules. Every two years, we review and assess our anti-corruption program with the goal of finding areas for improvement. This process is done under the direction of our Chief Compliance Officer, who reports the findings to the Audit Committee.
Oversight of human capital management
Oversight of human capital management, including culture and employee engagement, diversity, equity and inclusion and talent acquisition and development, historically has been conducted by the full Board, as well as the Human Resources Committee. In 2021, the Board amended the Human Resources Committee Charter to expressly delegate to the Committee oversight responsibilities in relation to human capital management.
Culture and employee engagement. Our Board views our employees as one of Verizon’s most critical assets and regularly receives briefings from the CEO on initiatives to strengthen our company culture and encourage employee engagement. The CEO reviews with the Board the results of the “Pulse” surveys completed by employees across the Company. Periodically, our Directors attend employee town halls and participate in leadership forums with employees.
17
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Diversity, equity and inclusion. Verizon is committed to creating a collaborative, inclusive, equitable and diverse environment – within Verizon, with our customers and among our business partners and suppliers. The Board views this commitment as a business imperative and a competitive advantage. To promote diversity in our workforce and encourage the contribution of diverse business partners to our success, the Human Resources Committee has included diversity targets as performance measures in the Short-Term Plan for over 20 years. The Chief Human Resources Officer reviews diversity representation and initiatives with the Committee at least annually.
Succession planning and talent development. Our Board recognizes that one of its most important duties is to promote continuity in Verizon’s senior leadership by overseeing the development of executive talent and planning for the efficient succession of the CEO. Our Board has delegated primary oversight responsibility for succession planning to the Human Resources Committee, which oversees assignments to key leadership positions. The Human Resources Committee reports on its activities to the full Board, which addresses succession planning during executive sessions that typically occur in connection with each regularly scheduled meeting.
To align the succession planning and management development process with Verizon’s strategic objectives, the Board and Human Resources Committee regularly consult with the CEO on Verizon’s organizational needs and competitive challenges, the potential of key managers, and plans for future developments and emergency situations. As part of this process, the Board and the Human Resources Committee also seek input from the Chief Human Resources Officer, as well as advice on related compensation issues from the Human Resources Committee’s independent compensation consultant.
Our Board generally conducts an in-depth review of senior leader development and succession planning at least twice a year. Led by the CEO and the Chief Human Resources Officer, this review addresses Verizon’s management development initiatives, assesses senior management resources, and identifies individuals who should be considered as potential future senior executives.
Our goal is to develop well-rounded, experienced and diverse senior leaders. High potential executives are challenged regularly with additional responsibilities, new positions or promotions to expose them to our diverse operations. These individuals are often positioned to interact more frequently with the Board, both in full Board meetings and in less formal settings and small groups, so the Directors can get to know and assess them.
Employee health and safety. Verizon is committed to maintaining a safe workplace and environmentally responsible work practices, and we expect our suppliers to share that commitment. At least annually, the Chief Human Resources Officer briefs the Human Resources Committee on the Company’s health and safety protocols, incidents involving employees and suppliers, and actions that management is taking to limit these risks.
Compensation risk. The Human Resources Committee considers the impact of our executive compensation program and the incentives created by compensation awards on Verizon’s overall risk profile. It also oversees management’s annual assessment of compensation risk arising from Verizon’s compensation policies and practices. This annual assessment is conducted by members of management including the Senior Vice President of Internal Audit and the Corporate Secretary. The assessment includes a review of the features and characteristics of Verizon’s compensation policies and programs, the performance metrics under the Short- and Long-Term Incentive Plans and the process for calculating and approving adjustments that are part of the plan, as well as the approval processes for compensation programs and related payouts. The assessment also reviews governance oversight at the Committee and Board level, Code of Conduct provisions and mandatory training programs that reinforce policies that mitigate risk, and performance metrics and measurement periods that are aligned with Verizon’s business strategy.
Based on management’s review, Verizon has concluded that our compensation policies and procedures are not reasonably likely to have a material adverse effect on Verizon because they are appropriately structured and discourage employees from taking excessive risks.
Business conduct and ethics. We are committed to operating with the highest level of integrity, responsibility and accountability. To that end, we have adopted a Code of Conduct that applies to all employees, including the CEO, the Chief Financial Officer and the Controller. The Code of Conduct describes each employee’s responsibility to conduct business with the highest ethical standards and provides guidance about preventing, reporting and remediating potential compliance violations in key areas. Verizon thoroughly investigates all claims of misconduct. Various types of cases are reported to the Chief Compliance Officer, who discusses the most serious Code violations with the Audit Committee at least annually.
18
Verizon 2022 Proxy Statement
Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Directors are expected to act in the spirit of the Code of Conduct, and to comply with the specific ethical provisions of the Corporate Governance Guidelines. Our Board is strongly predisposed not to waive any of these business conduct and ethics provisions for executive officers or Directors. In the unlikely event of a waiver, we will promptly disclose the Board’s action on our website.
Related person transactions. The Board has adopted the Related Person Transaction Policy that is included in the Guidelines. The Corporate Governance and Policy Committee reviews transactions between Verizon and any of our Directors or executive officers or members of their immediate families to determine if any participants have a material interest in the transaction. If the Committee determines that a material interest exists, based on the facts and circumstances of each case, the Committee may approve, disapprove, ratify or cancel the transaction or recommend another course of action. Any Committee members who are involved in a transaction under review do not participate in the Committee’s deliberations. During 2021, there were no related person transactions required to be disclosed in this proxy statement.
Our approach to shareholder engagement
We believe that a robust shareholder outreach program is an essential component of maintaining our strong corporate governance practices. Ongoing communication with our investors helps our Board and senior management gather useful feedback on a wide range of topics. In our discussions with investors, we seek their input on a variety of corporate governance, compensation and ESG topics that may impact our business or reputation. We strive for a collaborative approach with investors to solicit and understand a variety of perspectives. These engagements include the participation of our independent Lead Director, Clarence Otis, Jr., or other Directors, when requested and appropriate. Shareholder feedback is regularly summarized and shared with our Board.
In 2021, topics covered in engagement included:
Environmental • Climate change – net zero emission plan • Device and e-waste recycling • Network reliability and resilience | Social • Cybersecurity • Digital inclusion • Human capital, including diversity, equity and inclusion • Supply chain | Governance • Board diversity and skills • Business ethics • Executive compensation • Human rights • Political engagement | Disclosure • SASB industry standard • TCFD, including scenario analyses • Human capital metrics • ESG data index |
In addition to our regular shareholder engagement, in 2021, our Chief Financial Officer and our Corporate Secretary participated in calls with key investors to discuss our growth strategy and its relationship to our Board composition and refreshment plans. Our Chief Financial Officer also hosted a special engagement event focused on climate featuring senior leaders from the Network, Supply Chain, Treasury and ESG organizations for our 50 largest investors.
Also in 2021, our Lead Director, Clarence Otis, Jr., discussed corporate purpose, decisions about when to speak on social issues, Board oversight of human capital management, and Board composition and refreshment in a video on the Corporate Governance section of our website at www.verizon.com/about/investors/corporate-governance.
Verizon’s dedicated ESG team focuses on stakeholder engagement and decision-useful reporting in strategic areas including governance, human rights, environmental sustainability and digital trust and safety and also oversees Verizon’s efforts to deliver on its ESG commitments. Over the past two years, in response to feedback from our investors, we have aligned our ESG reporting with the Sustainability Accounting Standards Board standards for the telecommunications industry and the recommendations of the Task Force on Climate-Related Financial Disclosures. We strive to make it easy for shareholders to learn about our positions and progress on the issues that matter to them. To that end, we have created an ESG Resources Hub on our Investor Relations website at www.verizon.com/about/investors/reporting that houses all of our ESG reporting and policies.
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Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
2021 annual ESG reporting cycle
Communicating with our Directors
Our Board of Directors believes that communication with shareholders and other interested parties is an important part of the governance process, and has adopted the following procedure to facilitate this communication.
How to contact the Board
Any shareholder or interested party may communicate directly with our Board, any committee of our Board, any individual Director (including the Lead Director and the committee chairs) or the non-employee Directors as a group, by writing to:
Verizon Communications Inc.
Board of Directors
(or committee name, individual Director, Lead
Director, committee chair or non-employee
Directors as a group, as appropriate)
1095 Avenue of the Americas
New York, New York 10036
Verizon’s Corporate Secretary reviews all correspondence addressed to our Directors and periodically provides the Board with copies of all communications that deal with the functions of our Board or its committees, or that otherwise require Board attention. Typically the Corporate Secretary will not forward communications that are of a personal nature or are unrelated to the duties and responsibilities of our Board, including business solicitations or advertisements, mass mailings, job-related inquiries, or other unsuitable communications. All communications involving substantive accounting or auditing matters are forwarded to the Chair of the Audit Committee.
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Proxy summary | Governance | Executive compensation | Audit matters | Stock ownership | Shareholder proposals | Additional information |
Non-employee Director compensation
The Human Resources Committee, in consultation with its independent compensation consultant, reviews and recommends non-employee Director compensation. In 2021, each non-employee Director of Verizon was entitled to an annual cash payment of $125,000. The Chairs of the Corporate Governance and Policy Committee and the Finance Committee were entitled to receive an additional annual cash payment of $20,000, and the Chairs of the Audit Committee and the Human Resources Committee were entitled to receive an additional annual cash payment of $30,000. The Lead Director was entitled to an additional annual cash payment of $50,000. Directors who served in each of these roles for less than a full year received a portion of the annual payment commensurate with their service.
In 2021, each non-employee Director also received a grant of Verizon share equivalents valued at $175,000 on the grant date. No meeting fees were paid if a non-employee Director attended a Board or committee meeting on the day before or the day of a regularly scheduled Board meeting. Each non-employee Director who attended a Board or committee meeting held on any other date received a meeting fee of $2,000.
Each non-employee Director who joins our Board receives a one-time grant of 3,000 Verizon share equivalents valued at the closing price on the date the new Director joins our Board. Ms. Tomé did not receive such a grant upon joining the Board in 2021, because she previously received one in connection with her prior service on the Board in 2020.
All share equivalents that non-employee Directors receive are automatically credited to the Director’s deferred compensation account under the Verizon Executive Deferral Plan, which is referred to as the Deferral Plan, and invested in a hypothetical Verizon stock fund. Amounts in a Director’s deferred compensation account are paid in a cash lump sum in the year following the year the Director leaves our Board.
Non-employee Directors may choose to defer all or part of their annual cash payment and meeting fees (if any) under the Deferral Plan. They may elect to invest these amounts in the hypothetical investment options available to participants in Verizon’s Management Savings Plan or in a hypothetical cash account that earns a return rate equal to the long-term, high-grade corporate bond yield average as published by Moody’s Investor Services.
The non-employee Directors are eligible to participate in the Verizon Foundation Matching Gifts Program. Under this program, which is open to all Verizon employees, the Foundation matches up to $5,000 per year of charitable contributions to accredited colleges and universities, $1,000 per year of charitable contributions to any non-profit with 501(c)(3) status, and $1,000 per year of charitable donations to designated disaster relief campaigns.
Non-employee Director compensation in 2021
Name (a) | Fees earned or paid in cash1 ($) (b) | Stock awards2 ($) (c) | Option awards ($) (d) | Non-equity incentive plan compensation ($) (e) | Change in pension value and nonqualified deferred compensation earnings ($) (f) | All other compensation ($) (g) | Total ($) (h) | |||||||||||||||||||||
Shellye Archambeau* | 161,000 | 175,000 | 0 | 0 | 0 | 0 | 336,000 | |||||||||||||||||||||
Roxanne Austin | 145,000 | 175,000 | 0 | 0 | 0 | 0 | 320,000 | |||||||||||||||||||||
Mark Bertolini* | 157,000 | 175,000 | 0 | 0 | 0 | 0 | 332,000 | |||||||||||||||||||||
Vittorio Colao+ | 33,250 | 0 | 0 | 0 | 0 | 0 | 33,250 | |||||||||||||||||||||
Melanie Healey | 133,000 | 175,000 | 0 | 0 | 0 | 0 | 308,000 | |||||||||||||||||||||
Laxman Narasimhan | 62,500 | 256,370 | 0 | 0 | 0 | 0 | 318,870 | |||||||||||||||||||||
Clarence Otis, Jr.** | 195,000 | 175,000 | 0 | 0 | 0 | 0 | 370,000 | |||||||||||||||||||||
Daniel Schulman* | 161,000 | 175,000 | 0 | 0 | 0 | 0 | 336,000 | |||||||||||||||||||||
Rodney Slater | 133,000 | 175,000 | 0 | 0 | 0 | 0 | 308,000 | |||||||||||||||||||||
Carol Tomé | 43,667 | 58,333 | 0 | 0 | 0 | 0 | 102,000 | |||||||||||||||||||||
Gregory Weaver* | 175,000 | 175,000 | 0 | 0 | 0 | 0 | 350,000 |
* | Denotes a chair of a standing committee during 2021. |
** | Mr. Otis served as Lead Director during 2021. |
+ | Mr. Colao served on the Board until February 13, 2021. |
1 | This column includes all fees earned in 2021, whether the fee was paid in 2021 or deferred. |
2 | For each non-employee Director, this column reflects the grant date fair value of the non-employee Director’s 2021 annual stock award and, for Mr. Narasimhan, the one-time grant he |
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Verizon 2022 Proxy Statement
Proxy summary | Governance |
| Audit matters | Stock ownership | Shareholder proposals | Additional information |
compensation
Item 2: Advisory vote to approve executive compensation
Shareholders have strongly supported Verizon’s executive compensation program since our first annual advisory vote on the matter in 2009. We are asking you to vote in favor of the following non-binding resolution:
“Resolved, that the shareholders approve, on an advisory basis, the compensation of the named executive officers, as disclosed in Verizon’s proxy statement for the 2022 Annual Meeting of Shareholders pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, the Compensation Tables and the related narrative discussion.”
The structure of our executive compensation program for 2021 is similar to prior years, with updates to address changes in our business unit structure and strategic emphasis. Our Board recommends a vote FOR this resolution because the Board believes our program effectively:
Encourages strong short-term and long-term performance;
Aligns the executives’ long-term interests with those of our shareholders; and
Retains high-performing executives.
In the Compensation Discussion and Analysis and Compensation Tables beginning on page 23, we provide a detailed description of our executive compensation program, including our philosophy, the elements of our program and the compensation of our named executive officers. We encourage you to read these sections before deciding how to vote on this proposal.
This advisory resolution, commonly known as a “say-on-pay” resolution, is not binding on our Board of Directors. Nevertheless, the Board and the Human Resources Committee value shareholder feedback received through this annual say-on-pay vote and our direct investor outreach program. The voting results and direct shareholder input are carefully reviewed and considered and are an important part of the process for evaluating our executive compensation program.
The Board of |
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summary | Governance |
| Audit matters | Stock ownership | Shareholder proposals | Additional information |
Compensation discussion and analysis
* | Mr. |
** |
Roles and responsibilities Human Resources Committee. The Human Resources Committee of the Board of Directors oversees the design and implementation of the compensation program for our named executive officers, as well as Verizon’s management succession planning, talent development and human capital management initiatives, including with respect to employee diversity, equity and inclusion and pay equity. The CEO’s compensation is determined by the independent members of the Board after receiving the Committee’s recommendation. References to the Committee in this Compensation Discussion and Analysis with respect to the CEO’s compensation reflect that process. Management. The Committee may consult with the Chief Human Resources Officer about the design, administration and operation of the compensation program. The Committee has delegated administrative responsibility for implementing its decisions on compensation and benefits matters to the Chief Human Resources Officer, who reports to the Committee on the actions taken under this delegation. The Committee seeks the CEO’s views on whether the existing compensation policies and practices continue to support Verizon’s business and performance objectives, utilize appropriate performance targets, and appropriately reward the contributions of the other named executive officers. While the Committee values the CEO’s insight, ultimately the Committee makes an independent determination on all matters related to the compensation of the named executive officers. Independent compensation consultant. The Committee has the sole authority to retain and terminate a compensation consultant and to approve all terms of the engagement, including fees. The Committee retained Semler Brossy as its compensation consultant (Consultant). The Consultant advises the Committee on all matters related to the compensation of our named executive officers and our non-employee Directors. The Consultant’s advisory services include providing current benchmarking data for our peer group and other relevant market data in our industry and helping the Committee interpret this data, as well as data provided by the Company. The Consultant participates in all Committee meetings and confers regularly with the Committee in executive session at those meetings. Committee policy prohibits the Consultant from doing any work for the Company during its engagement, and the Consultant did not perform work for the Company in 2021. The Committee made assessments of the Consultant under SEC rules and NYSE and Nasdaq listing standards and concluded that the Consultant was independent, and that its work in 2021 for the Committee did not raise any conflicts of interest. Shareholder feedback on compensation Our Board, the Human Resources Committee and our management team value shareholder perspectives on our executive compensation program. Management and Directors engage with our institutional shareholders in meetings and calls throughout the year. Topics of discussion typically include the Committee’s choice of performance measures for awards issued under our Short- and Long-Term Incentive Plans, the relationship between the performance measures and our long-term strategy, the payout terms of equity awards, compensation recoupment policies and shareholder proposals, and our long-standing practice of including quantitative ESG performance measures in our Short-Term Plan. In addition to this direct feedback, as part of the Committee’s annual review of the executive compensation program, the Committee considers the outcome of Verizon’s annual shareholder advisory vote on executive compensation – the “say-on-pay.” At our Annual Meeting 23 Verizon 2022 Proxy Statement
in May 2021, the compensation of our named executive officers was approved by approximately 92% of votes cast. Based on the perspective obtained from discussions with our long-term shareholders, the results of our 2021 say-on-pay vote, and the history of strong shareholder support in prior say-on-pay votes, the Committee believes our shareholders continue to strongly support Verizon’s executive compensation program. Best practices in executive compensation and governance Our compensation program reflects our commitment to industry-leading standards for compensation design and governance. The Human Resources Committee regularly reviews best practices in executive compensation and governance and revises our policies and practices when appropriate. The following table highlights some features of our executive compensation program that demonstrate the rigor of our policies.
24 Verizon 2022 Proxy Statement
Benchmarking total compensation opportunity The Committee evaluates whether the compensation opportunities for our executives are appropriate and competitive by comparing each named executive officer’s total compensation opportunity – which represents the sum of the executive’s base salary and target award amounts under the Short-Term Plan and the Long-Term Plan – to the total compensation opportunities for executives in comparable positions at peer companies, referencing the 50th percentile when making this comparison. A named executive officer’s total compensation opportunity may be higher or lower depending upon the executive’s tenure and overall level of responsibility. The peer groups utilized for compensation benchmarking are reviewed each year. For 2021 compensation decisions, the Committee utilized a peer group that consisted of the companies in the Dow Jones Industrial (Dow) Average (other than Verizon) with at least $50 billion in annual revenue, plus Verizon’s four largest industry competitors (AT&T, Charter Communications, Comcast and T-Mobile US) and four large market-cap technology companies (Alphabet, Amazon, Meta Platforms and Netflix) that are not included in the Dow. The inclusion of the four additional technology companies in the peer group for 2021 compensation decisions represented a change to the peer group used for 2020 compensation decisions, which was comprised of the companies (other than Verizon) in the Dow with at least $50 billion in annual revenue, plus Verizon’s five largest industry competitors that were not included in the Dow (AT&T, Charter Communications, Comcast, Sprint Corporation and T-Mobile US). The Committee determined that increasing an emphasis on technology companies in our peer group would better reflect the companies we compete with for executive talent, while maintaining a robust number of peer companies for comparison purposes and providing clarity and transparency for shareholders. Below are the companies included in the Company’s peer group for 2021 compensation purposes.
Compensation objectives and elements of compensation Compensation objectives Verizon’s executive compensation program supports the creation of shareholder value by pursuing four key objectives: Attract and retain high-performing executives with the leadership abilities and experience necessary to drive our customer-focused transformation of the digital market, within an enterprise of our scale, breadth and complexity; Pay for superior results and sustainable growth by rewarding the achievement of challenging short- and long-term performance goals designed to build shareholder value; Drive performance and create shareholder value by emphasizing variable, at-risk compensation with an appropriate balance of short-term and long-term objectives that align executive and shareholder interests; and Manage risk through oversight and compensation design features, policies and practices that strike an appropriate balance between risk and reward. 25 Verizon 2022 Proxy Statement
Elements and mix of compensation to emphasize long-term performance The Committee determines the appropriate balance between fixed and variable pay elements, short- and long-term pay elements, and cash and equity-based pay elements when setting total compensation opportunities at competitive levels.
The Committee believes that a substantial majority of each named executive officer’s total compensation opportunity should be variable and at risk in order to emphasize a performance-based culture. Moreover, since the annual Long-Term Plan awards feature three-year award cycles, with awards consisting of PSUs subject to both performance-based and time-based vesting requirements and RSUs subject to time-based vesting requirements, we reward sustained performance and also encourage high-performing executives to remain with Verizon. The following chart illustrates the approximate allocation of the named executive officers’ 2021 total compensation opportunity between variable, performance-based elements and fixed pay. 2021 total compensation pay mix In establishing the mix of incentive pay for the named executive officers, the Committee balances the importance of meeting Verizon’s short-term business goals with the need to create shareholder value over the longer term. The Committee also considered market data with respect to the mix of annual cash and long-term equity components for similarly situated executives among the peer group. Based on its review, the Committee established long-term target compensation opportunities at levels more than double the annual base salary and short-term incentive target compensation opportunities of the named executive officers. Performance target setting The Committee takes a holistic approach to establishing performance targets under our incentive plans and ensuring that they are aligned with Verizon’s short- and long-term strategic goals. In establishing performance targets, the Committee recognizes the importance of achieving an appropriate balance between rewarding executives for strong performance over both the short- and long-term and establishing realistic goals that continue to motivate and retain executives. As a result, our Short-Term and Long-Term Plans provide for measurable, rigorous performance targets that are attainable, but challenge executives to drive business results that generate shareholder value. In setting the performance targets, the Committee considered the following factors: Verizon’s short- and long-term strategy; 26 Verizon 2022 Proxy Statement
Economic, industry and competitive environments; The creation of shareholder value; The achievement level against performance targets in the prior year; Financial analysts’ consensus estimates for the performance measures over future performance cycles; The correlation among the performance measures and considerations of how Verizon’s operational performance will affect each measure differently; and With regard to the ESG metrics in the Short-Term Plan, Verizon’s commitments to reduce its environmental impact and promote diversity in its workforce and among its business partners. 2021 annual base salary To determine an executive’s base salary, the Committee, with assistance from the Consultant, considers the pay practices of the peer group for comparable positions; the executive’s experience, tenure, scope of responsibility and performance; internal pay alignment; continuity planning and management development considerations; and for newly-hired executives, the Committee also considers the compensation required to attract the executive to the Company. There is no specific weighting applied to any of these factors in setting annual salaries, and the process ultimately relies on the subjective exercise of the Committee’s judgment. Taking into account these considerations, the Committee approved 2021 base salary increases of 5% for Mr. Dunne, 11.76% for Ms. Erwin and 6.25% for Mr. Malady. Messrs. Vestberg, Ellis and Gowrappan did not receive a base salary increase in 2021. 2021 short-term incentive compensation The Verizon Short-Term Plan motivates executives to achieve challenging short-term performance targets in order to provide the foundation for future growth. Each year, the Committee establishes the potential value of the awards under the Short-Term Plan, as well as the performance targets required to achieve these awards. The Committee set the values of the 2021 Short-Term Plan award opportunities as a percentage of an executive’s base salary based on both the scope of the executive’s responsibilities and the competitive pay practices of the peer group used for benchmarking our executives’ total compensation opportunity. The Short-Term Plan award opportunities at the threshold, target and maximum levels for each of the named executive officers are shown in the grants of plan-based awards table on page 42. For the named executive officers, target award opportunities, expressed as a percentage of base salary, did not change for 2021. However, the dollar value of the 2021 target award opportunity for Mr. Dunne, Ms. Erwin and Mr. Malady increased from 2020 as a result of the base salary increases described above. The following table shows the 2021 Short-Term Plan target award opportunity for each of the named executive officers. 2021 Short-Term Plan target award opportunity
Annual performance measures In February 2021, the Committee established the performance measures and targets for the 2021 Short-Term Plan. The Committee established financial, operational and ESG performance measures and targets at the Verizon corporate level, based on Verizon’s consolidated results, that apply to all executives under the plan and established additional financial and operational performance measures and targets and qualitative leading indicators that applied to executives in each of the Company’s operating units – the Business Group, Consumer Group, Global Network and Technology (GN&T) Group and Media Group. The Short-Term Plan award opportunity for Messrs. Vestberg and Ellis was determined solely by the 27 Verizon 2022 Proxy Statement
Company’s achievement against the Verizon corporate performance measures. Fifty-percent of the Short-Term Plan opportunity for Mr. Dunne, Ms. Erwin and Mr. Malady was determined by the Company’s achievement against the Verizon corporate performance measures, and 50% was determined by the achievement of the financial and operational performance measures and qualitative leading indicators established for the respective unit that each leads. For each performance measure, the Committee set a target that challenges executives to drive business results that generate shareholder value. Verizon’s performance with respect to these applicable measures determines the amount of the short-term incentive awards earned by the named executive officers. Mr. Gowrappan was not eligible to receive a Short-Term Plan award from Verizon for 2021 as a result of his separation from Verizon and continued employment with the Media Group business upon the sale of the Media Group business to affiliates of Apollo in September 2021 (Media Group Sale). The 2021 performance measures, along with the weighting ascribed to each, are shown below as a percentage of the total Short-Term Plan award opportunity at target level performance. The Committee believes that these performance measures are appropriate to motivate Verizon’s executives to achieve outstanding short-term results and, at the same time, help establish the foundation for long-term value for shareholders. The 2021 measures and related targets approved by the Committee are described in detail below. The Committee did not make any modifications to the 2021 measures and targets due to COVID-19. 2021 Short-Term Plan performance measures and weightings 28 Verizon 2022 Proxy Statement
Adjusted operating income is a measure that reflects operating profitability because it indicates how much profit we generate after subtracting operating expenses, including depreciation and amortization and the other costs of running the business, from total revenue. The Committee views this as an important indicator of how well our management is growing revenue while managing operating costs. Adjusted operating income excludes the effect of special items, which provides more comparable financial results from period to period. Service and other revenue is a measure that reflects the extent to which we have been successful in attracting and retaining customers, penetrating key markets with our products and services and creating high-quality growth. The Committee views this measure as an important indicator of Verizon’s growth and success in realizing its strategic initiatives. The Committee selected this measure for the 2021 Short-Term Plan, rather than total revenue, which was utilized as a performance measure for the 2020 Short-Term Plan, because service and other revenue better reflects our generation of profitable revenue from attracting and retaining customers and penetrating key markets with our products and services and excludes revenue from
Cash flow from operations is a measure of the cash generated from our ongoing, regular business activities and is used to fund expansion and modernization of our networks, service and repay external financing, pay dividends and invest in new businesses and spectrum. The Committee selected this measure for the 2021 Short-Term Plan, rather than free cash flow, which was utilized as a performance measure for the 2020 Short-Term Plan, because cash flow from operations is not reduced by capital expenditures. In making this selection, the Committee considered the Company’s strategic imperative to quickly deploy the C-Band spectrum it was acquiring in 2021 and determined that this measure would be better aligned with and further the Company’s strategy, because it would not disincentivize management from making additional capital expenditures to more quickly put the C-Band spectrum into service, if a faster roll-out could be achieved. ESG metrics relating to diversity and sustainability reinforce our corporate purpose to “create the networks that move the world forward.” As a large, multinational company with a highly diverse customer and employee base, we know that our operations are strengthened when we leverage the diversity of thought and cultures of our workforce and business partners. We are also committed to reducing the environmental impact of our operations because we believe that it is important for us to be good stewards of our planet while we continue to serve our customers. Therefore, the Committee utilizes diversity and sustainability metrics and targets that measure the percentage of our U.S.-based workforce that is comprised of women and minorities (workforce diversity), the amount of our overall annual supplier spend with diverse firms (diverse supplier spend) and the percentage by which we reduce our carbon intensity – the amount of carbon our business emits divided by the terabytes of data we transport over our networks – as compared to the prior year (carbon intensity reduction). For the unit-level performance measures, in addition to the Verizon corporate performance measures which make up 50% of the award opportunity for unit leaders, the Committee selected unit-level adjusted operating income and service and other revenue for the Consumer Group and Business Group and a network expense performance measure for the GN&T Group to further focus the unit-level leaders on driving their individual unit’s contribution to Verizon’s overall profitability and growth. The Committee also selected qualitative leading indicators for the Consumer Group and Business Group to focus unit leaders on annual strategic initiatives designed around the 5G strategy and other objectives that lay the groundwork for our long-term growth and, for the GN&T Group, to focus GN&T leaders on maintaining network leadership while building for the future. At the end of the year, the CEO assesses the extent to which each unit has delivered on the leading indicators and will make a recommendation to the Committee on the level of attainment. 29 Verizon 2022 Proxy Statement
2021 adjusted company results1 The Short-Term Plan provides for performance measures to be adjusted to exclude the impact of certain types of events not contemplated at the time the performance measures were set, such as significant transactions, changes in legal or regulatory policy and other special items. In determining Verizon corporate performance against the performance measures, the Committee made adjustments to service and other revenue and adjusted operating income for impacts associated with strategic transactions in 2021, adjustments to adjusted operating income and cash flow from operations for impacts related to the 2021 acquisition of C-Band spectrum through the Federal Communications Commission’s Auction 107 (C-Band Acquisition) and adjustments to workforce diversity for the impacts related to the Media Group Sale. For the Consumer Group, the Committee made adjustments to service and other revenue and adjusted operating income for strategic transactions in 2021, and adjustments to adjusted operating income for impacts associated with the C-Band Acquisition and intercompany expenses. For the Business Group, the Committee made adjustments to adjusted operating income for intercompany expenses, and for the GN&T Group, the Committee made adjustments to network expenses for impacts associated with the C-Band Acquisition. The Committee did not make any modifications to the 2021 targets or results due to COVID-19.
30 Verizon 2022 Proxy Statement
31 Verizon 2022 Proxy Statement
2021 Short-Term Plan awards Based on its assessment of Verizon’s performance against the Verizon corporate measures and targets set forth above, the Committee approved a payout percentage for Verizon corporate of 102%. For each of the three operating units – Consumer Group, Business Group and GN&T Group – the Committee considered both the level of performance with respect to each unit’s performance measures set forth above and took into consideration the CEO’s assessment of each unit’s level of achievement of the respective leading indicators, and for GN&T Group network performance, to determine the payout percentage for the operating unit. Based on its assessment, the Committee approved a payout percentage for the Consumer Group of 95%, the Business Group of 92% and the GN&T Group of 110%. The following table shows the actual Short-Term Plan award earned by each named executive officer other than Mr. Gowrappan based on the payout percentages detailed above. Mr. Gowrappan was not eligible to receive a Short-Term Plan award from Verizon as result of Mr. Gowrappan’s separation from Verizon and continued employment with the Media Group business upon the sale of the Media Group business in September 2021.
Long-term incentive compensation The Long-Term Plan is intended to align executives’ and shareholders’ interests and to reward participants for creating long-term shareholder value. Annual Long-Term Plan awards are made in 60% PSUs and 40% RSUs. The value of each PSU or RSU is equal to the value of one share of Verizon common stock. The Committee assumes each executive will earn 100% of the PSUs and RSUs awarded for purposes of determining the total compensation opportunity. PSUs and RSUs accrue dividend equivalents that are deemed to be reinvested in PSUs and RSUs, respectively. These dividend equivalents are paid when, and only to the extent that, the related PSUs and RSUs are actually earned. PSUs are earned over a three-year performance cycle, with cliff vesting at the end of the three-year period. The Committee believes that a three-year performance cycle is appropriate for the PSU awards because a multi-year performance cycle measures the effectiveness of management’s execution of long-term strategies and the effect on shareholder value. RSUs vest ratably over three years (as opposed to a single, longer cliff vesting schedule), which aligns with market practice and enables us to continue to attract and retain key executive talent. The number of PSUs actually earned and paid is determined based upon Verizon’s achievement of pre-established performance targets over the three-year performance cycle, and the ultimate value of each PSU is based on the closing price of Verizon’s common stock on the last trading day of the performance cycle. Because the value of PSUs is linked to both stock price and performance targets, PSUs provide a strong incentive to executives to deliver value to Verizon’s shareholders. RSUs also provide a performance link as the value of the award depends on Verizon’s stock price. Both PSUs and RSUs provide a retention incentive by requiring the executive to remain employed with Verizon through the end of the applicable vesting period, subject to certain qualifying separations. The 2021 PSUs and RSUs are payable in shares of Verizon stock. 2021 Long-Term Plan award opportunities The Committee set the annual target long-term incentive award levels to create an appropriate total compensation opportunity for these officers in light of the Committee’s reference of the 50th percentile for comparable executives within the peer group and the compensation mix considerations described above, and taking into account market practices for each individual’s role and responsibilities, the individual’s performance, the strategic impact of the individual’s role and internal pay alignment. The 2021 target award opportunity for the named executive officers was allocated between PSUs and RSUs as noted above, and the target award opportunity allocated to each type of award was converted into a target number of units using the closing price of Verizon’s common stock on the grant date. 32 Verizon 2022 Proxy Statement
The following table shows the target value of the 2021 Long-Term Plan awards granted to the named executive officers. 2021 Long-Term Plan target award opportunity
Consistent with past practice, each of the named executive officers received 60% of his or her 2021 Long-Term Plan award in the form of PSUs and 40% in the form of RSUs, which the Committee believes incentivizes our executives to focus on our long-term operational goals and to deliver superior total shareholder return (TSR) performance, as well as encourages retention among our highly-qualified team. Fifty-percent of the 2021 PSUs is eligible to vest based on Verizon’s cumulative adjusted EPS and fifty-percent is eligible to vest based on Verizon’s cumulative free cash flow. The number of PSUs that will ultimately vest may be decreased or increased by up to 25% depending on Verizon’s TSR position at the end of the three year period compared with the companies in the S&P 100 as constituted on the date the awards were granted. Terms of 2021 PSU awards Adjusted earnings per share metric Fifty-percent of the 2021 PSUs will vest based on Verizon’s cumulative adjusted earnings per share (EPS PSUs). The percentage of the EPS PSUs awarded for the 2021-2023 performance cycle that will vest is based on the extent to which Verizon’s cumulative adjusted EPS over the performance cycle meets or exceeds the cumulative adjusted EPS performance levels set by the Committee at the beginning of the performance cycle. Adjusted EPS is defined as Verizon’s cumulative earnings per share over the three-year performance period, adjusted to exclude the impact of special items, including the benefit of any repurchases of Verizon’s common stock under a share buyback program, and is subject to adjustment to eliminate the financial impact of significant transactions, changes in legal or regulatory policy and other extraordinary items. The cumulative adjusted EPS target for the 2021-2023 performance cycle was set at a level reflective of our three-year strategic plan, which the Committee believes is attainable, but challenging in light of the business environment. The number of EPS PSUs that will vest ranges from 0%, if actual performance is below the threshold level, to 200%, if actual performance is at or above the maximum cumulative EPS level. The number of EPS PSUs that will vest in-between identified performance levels is determined by linear interpolation between vesting percentage levels. 33 Verizon 2022 Proxy Statement
Free cash flow metric Fifty-percent of the 2021 PSUs will vest based on Verizon’s cumulative free cash flow (FCF PSUs). The percentage of the FCF PSUs awarded for the 2021-2023 performance cycle that will vest is based on the extent to which Verizon’s cumulative free cash flow over the performance cycle meets or exceeds the cumulative free cash flow performance levels set by the Committee at the beginning of the performance cycle. Free cash flow is calculated by subtracting capital expenditures from the total of cash flow from operations and is subject to adjustment to eliminate the financial impact of significant transactions, changes in legal or regulatory policy and other extraordinary items. The cumulative free cash flow target for the 2021-2023 performance cycle was set at a level reflective of our three-year strategic plan, which the Committee believes is attainable, but challenging in light of the business environment. The number of FCF PSUs that will vest ranges from 0%, if actual performance is below the threshold level, to 200%, if actual performance is at or above the maximum cumulative free cash flow level. The number of FCF PSUs that will vest in-between identified performance levels is determined by linear interpolation between vesting percentage levels. Total shareholder return modifier After the Committee determines the extent to which the EPS PSU and FCF PSU performance measures have been achieved, the number of PSUs that will ultimately vest may be increased or decreased by up to 25% depending on Verizon’s TSR position compared with the companies in the S&P 100 as constituted on the date the awards were granted. If Verizon ranks at or above the 75th percentile, the PSU vesting percentage will be increased by 25% (up to a maximum payout of 200%). If Verizon ranks at or below the 25th percentile, the PSU vesting percentage will be decreased by 25%. If Verizon ranks at the median, there will be no change to the PSU vesting percentage, and for ranks in between the 25th and 75th percentile, the multiplier will be determined by linear interpolation between the levels.
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