(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
(Amendment No. )
☒ | 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 240.14a-12 | |
PAYMENT OF FILING FEE
☒ | No fee required. | |||
☐ | Fee paid previously with preliminary materials. | |||
☐ | Fee computed on table 0-11. | |||
PRELIMINARY PROXY STATEMENT—SUBJECT TO COMPLETION
| 320 Park Avenue, 29th Floor New York, NY 10022 (212) 277-7100 |
Dear Stockholder,
2022 was a year marked by disruption and transformation. At EXL, we viewed this as an opportunity. We developed innovative solutions to harness our clients’ data and gain a competitive advantage. Their successes led to our success.
Our headline earnings numbers tell part of the story. In 2022, we generated strong growth across both Analytics and Digital Operations and Solutions. Our 2022 revenue was 1.41 billion, representing growth of 26% over 2021. We also grew adjusted EPS to $6.02, up 25% from $4.83 in 2021.
Our achievements in 2022 are rooted in our unique data-driven capabilities to improve our clients’ operations through digital solutions, enable better decision-making through advanced analytics, and embed intelligence in their workflows through machine learning, AI and automation. Every business today is being challenged to do more with less while customer expectations for speed, personalization and seamless integration continue to expand. EXL harnesses the power of data to help our clients meet those challenges. These data-driven efforts help our clients react faster, reduce costs and build stronger customer experiences. Going forward, we believe this strategy will continue to grow the success of our clients and our success.
Our ability to execute this strategy is a testament to our talented and steadily growing team of more than 45,400 people, as well as our culture of learning, diversity and experience. Our employees’ creativity and dedication allow EXL to meet market demand and keep pace with our clients’ evolving requirements. In 2022, our employees continued to enhance their expertise, collectively investing more than 509,000 hours in developing their professional skills, functional and leadership capabilities and domain expertise. We achieved more than 8,000 specializations across key areas, such as cloud, analytics and artificial intelligence solution architecture, among others.
This year’s Proxy Statement continues to highlight progress on our environmental, social and governance (ESG) efforts, which we view as integral to our corporate strategy. In 2022, we made strides toward our transition to sustainable energy and gave back to more than 14,000 people in our communities around the world through volunteering in our signature community engagement initiatives, Skills to Win and Education as a Foundation. We also helped our clients make their businesses more sustainable through the use of cloud services, digital operations and solutions resulting in paper reduction and analytics to meet compliance and risk objectives. We continuously improve on our corporate governance – in 2022, by allocating formal oversight over ESG-related controls and disclosures to our Audit Committee, and by carrying through our board refreshment philosophy to promote the diversity of backgrounds, skills and professional experience among our directors necessary to oversee our evolving corporate strategy, while continuing to hold regular conversations with our stockholders on governance-related topics through our stockholder engagement program. We are proud of this progress, and the external recognitions we received for these efforts, including for the second year as one of America’s Most Responsible Companies by Newsweek and Statista, Inc., and for the second year as one of Barron’s 100 Most Sustainable Companies and a Gold rating from EcoVadis. You can read more about our commitment to ESG issues on our website, in our Sustainability Report and in the “Sustainability” section of this Proxy Statement.
| 2 | / | EXL 2023 Proxy Statement |
PRELIMINARY PROXY STATEMENT
SUBJECT TO COMPLETION
320 Park Avenue, 29th Floor
New York, New York 10022
(212) 277-7100
April 26, 2019
Dear Stockholder:
Finally, we would like to thank Anne Minto and Clyde Ostler who will be retiring from our board of directors following our 2023 Annual Meeting of Stockholders. Anne served on EXL’s board for 10 years and Clyde has been on our board since 2007. Both have played key roles in guiding our company to its current position. We would also like to welcome Andreas Fibig, a seasoned global executive with a strong record of innovation across industries and geographies, who joined EXL’s board as an independent director in January 2023, and is standing for reelection at the 2023 Annual Meeting of Stockholders.
On behalf of the board of directors of ExlService Holdings, Inc., we are pleased to invite you to the 20192023 Annual Meeting of Stockholders, which will be held on June 17, 2019 in New York, New York.
The20, 2023. We look forward to sharing more about our Company at the Annual Meeting. We encourage you to carefully read the attached 2023 Annual Meeting will begin with discussion and voting on the matters set forth on the accompanying Notice of the Annual MeetingStockholders and Proxy Statement, followed by discussion of other businesswhich contains important information about the matters properly brought beforeto be voted upon and instructions on how you can vote your shares.
Your vote is important to us. Please vote as soon as possible whether or not you plan to participate in the Annual Meeting.
Pursuant to rules promulgated by the Securities and Exchange Commission, we are providing access to our proxy materials over the Internet. On or about April 26, 2019, we will mail a Notice of Internet Availability of Proxy Materials (the “Internet Notice”) to each of our stockholders of record and beneficial owners at the close of business on April 18, 2019, the record date for the Annual Meeting. On the date of mailing of the Internet Notice, all stockholders and beneficial owners will have the ability to access all of the proxy materials on a website referred to in the Internet Notice. These proxy materials will be available free of charge.
Even if you choose to attend the Annual Meeting in person, you are encouraged to review the proxy materials and vote your shares in advance of the meeting by Internet or phone. The Internet Notice will contain instructions to allow you to request copies of the proxy materials to be sent to you by mail. Any proxy materials sent to you will include a proxy card that you may use to cast your vote by completing, signing and returning the proxy card by mail (or voting instruction form, if you hold shares through a broker). Your vote is extremely important, and we appreciate you taking the time to vote promptly. If you attend the Annual Meeting, you may withdraw your proxy should you wish to vote in person.
The board of directors and management look forward to seeing youyour attendance at the Annual Meeting.
Sincerely,
 |  | |
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| Vikram Pandit Chairman | Rohit Kapoor Vice Chairman and CEO |
| EXL 2023 Proxy Statement | / | 3 |
NOTICE OF 2019 ANNUAL MEETING OF STOCKHOLDERS
Notice of 2023 Annual Meeting of Stockholders
Dear Stockholder:
You are cordially invited to the 20192023 Annual Meeting of Stockholders of ExlService Holdings, Inc., a Delaware corporation (the “Company”). The Annual Meeting will be held at the New York offices of the Company, 320 Park Avenue, 29th Floor, New York, New York 10022 on June 17, 2019 at 8:30 AM, Eastern Time,, for the purposes of voting on the following matters:
| 1. |
| the election of |
the ratification of the appointment of Deloitte & Touche LLP as the independent registered public accounting firm of the Company for fiscal year |
the approval, on a non-binding advisory basis, of the compensation of the named executive officers of the Company; |
| 4. | the determination, on a non-binding advisory basis, of how frequently the stockholders should hold a non-binding advisory vote to approve the compensation of the named executive officers of the Company; |
| 5. | the approval of an amendment to our Amended and Restated Certificate of Incorporation to effect a 5-for-1 “forward” stock split with a corresponding increase in the authorized number of shares of our common stock; |
| 6. | the approval of an amendment to our Amended and Restated Certificate of Incorporation to allow for the removal of directors with or without cause by the affirmative vote of holders of a majority of the total outstanding shares of common stock; and |
| 7. | the transaction of such other business as may properly come before the Annual Meeting or any adjournment or postponement thereof. |
We will hold our Annual Meeting in virtual format only, via live audio webcast (rather than at any physical location) on June 20, 2023 at 8:30 AM, Eastern Time. Our virtual meeting platform will allow for full participation as if you were attending physically. You or your proxyholder may participate, vote, and examine our stockholder list at the Annual Meeting by visiting www.virtualshareholdermeeting.com/EXLS2023 and using your 16-digit control number.
If you are a stockholder of record at the close of business on April 18, 2019,21, 2023, the record date for the Annual Meeting, you are entitled to vote at the Annual Meeting. A list of stockholders as of the record date will be available for examination for any purpose germane to the Annual Meeting, during ordinary business hours, at the Company’s executive offices at 320 Park Avenue, 29th Floor, New York, New York 10022, for a period of 10 days prior to the date of the Annual Meeting and at the Annual Meeting itself. If our corporate headquarters are closed during the 10 days prior to the Annual Meeting, you may send a written request to the Corporate Secretary at our corporate headquarters, and we will arrange a method for you to inspect the list. The list of stockholders will also be available during the Annual Meeting at www.virtualshareholdermeeting.com/EXLS2023.
Please note that there are identification, verification of ownership and otherthe technical requirements for in-personvirtual attendance at the Annual Meeting, as described in the enclosed Proxy Statement beginning on page 11128 under the heading “Information Concerning Voting“Annual Meeting Q&A.”
Pursuant to rules promulgated by the Securities and Solicitation.”Exchange Commission, we are providing access to our proxy materials over the Internet. On or about April 28, 2023, we will mail a Notice of Internet Availability of Proxy Materials (the “Internet Notice”) to each of our stockholders of record and beneficial owners at the close of business on the record date. On the date of mailing of the
| 4 | / | EXL 2023 Proxy Statement |
Internet Notice, all stockholders and beneficial owners will have the ability to access all of the proxy materials on a website referred to in the Internet Notice. These proxy materials will be available free of charge.
Whether or not you expect to attend the Annual Meeting, in person, the Company encourages you to promptly vote and submit your proxy (i) by (i) Internet (by following the instructions provided in the Internet Notice), (ii) by phone (by following the instructions provided in the Internet Notice) or (iii) by requesting that proxy materials be sent to you by mail that will include a proxy card that you can use to vote by completing, signing, dating and returning the proxy card in the prepaid postage envelope provided. Voting by proxy will not deprive you of the right to attend the Annual Meeting or to vote your shares in person.shares. You can revoke a proxy at any time before it is exercised by voting in person at the Annual Meeting, by delivering a subsequent proxy or by notifying the inspector of elections in writing of such revocation prior to the Annual Meeting. YOUR SHARES CANNOT BE VOTED UNLESS YOU EITHER (I) VOTE BY USING THE INTERNET, (II) VOTE BY PHONE, (III) REQUEST PROXY MATERIALS BE SENT TO YOU BY MAIL AND THEN USE THE PROXY CARD PROVIDED BY MAIL TO CAST YOUR VOTE BY COMPLETING, SIGNING AND RETURNING THE PROXY CARD BY MAIL OR (IV) ATTEND THE ANNUAL MEETING AND VOTE IN PERSON.VOTE.
By Order of the Board of Directors
 | |
Ajay Ayyappan
Executive Vice President, General Counsel and Corporate Secretary
New York, New York
April 26, 201928, 2023
TABLE OF CONTENTS
| EXL 2023 Proxy Statement | / | 5 |
2023 Proxy Statement
Table of contents
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| 86 | ||||
| 87 | ||||
| 6 | / | EXL 2023 Proxy Statement |
PROXY STATEMENT
2019 PROXY STATEMENT SUMMARY2023 Proxy Statement summary
Summary2023 Proxy Statement summary
Summary
Below is a summary of selected keyselect components of this proxy statement,Proxy Statement, including information regarding this year’s stockholder meeting, nominees for our board of directors, summary of our business, performance highlights and selective executive compensation information. This summary does not contain all of the information that you should consider prior to submitting your proxy, and you should review the entire proxy statementProxy Statement and our Annual Report on Form 10-K for the fiscal year ended December 31, 20182022 (the “2018“2022 Form 10-K”). We refer to the fiscal year ended December 31, 2022 as “fiscal year 2022,” “fiscal 2022,” and “2022.”
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Meeting Agenda, Voting Mattersagenda, voting matters and Recommendationsrecommendations*
| Board vote recommendation | ||||
1. Election of directors |  | FORthe election of (pg. 115) | ||
Required vote: Affirmative vote of | ||||
2. Ratification of appointment of | | FOR(pg. 117) | ||
Required vote: Affirmative vote of a majority of shares present in person or represented by proxy and entitled to vote | ||||
3. Advisory (non-binding)Say-on-Pay vote to approve executive compensation | | FOR(pg. 119) | ||
Required vote: Affirmative vote of a majority of shares present in person or represented by proxy and entitled to vote | ||||
4. Advisory (non-binding)Say-on-Frequency vote on the frequency of the |  | EVERY YEAR(pg. 121) | ||
Required vote: The option receiving the | ||||
5. Charter amendment to effect a 5-for-1 “forward” stock split with a corresponding increase in the authorized number of shares of our common stock | | FOR(pg. 122) | ||
Required vote: Affirmative vote of a majority of the | ||||
6. Charter amendment to allow removal of directors with or without cause by the affirmative vote of holders of a majority of the | | FOR(pg. 125) | ||
Required vote: Affirmative vote of at least 66 2/3% of the | ||||
* Virtual attendance at our Annual Meeting will constitute presence in person for purposes of | ||||
Annual meeting information | ||||
| Time and date: | |||
| 8:30 AM (Eastern Time) June 20, 2023 | ||||
| Record date: | |||
| April 21, 2023 | ||||
| Place: | |||
| Virtual format only via live audio webcast | ||||
| Voting: | |||
Stockholders as of the | ||||
Board and Corporate Governance Highlights
(Based on current board profile and practices)
| ||||
| Internet (pre-meeting): | |||
| www.proxyvote.com | ||||
| Mail: | |||
Follow instructions on the
| ||||
| Phone: | |||
| Call the number listed on the Internet notice | ||||
| Electronically: | |||
| Attend the Annual Meeting and vote electronically | ||||
If you are the beneficial owner of shares held in the name of a brokerage, bank, trust or other nominee as a custodian (also referred to as shares held in “street name”), your broker, bank, trustee or nominee will provide you with materials and instructions for voting your shares. See page 129 for additional details.
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| EXL 2023 Proxy Statement |
| 7 |
2023 Proxy Statement summary
Our business
We are a leading data analytics and digital operations and solutions company that partners with clients to improve business outcomes and unlock growth. By bringing together deep domain expertise with robust data, powerful analytics, cloud, artificial intelligence (“AI”) and machine learning (“ML”), we create agile, scalable solutions and execute complex operations for the world’s leading corporations in industries including insurance, healthcare, banking and financial services, media, and retail, among others. Focused on driving faster decision making and transforming operating models, EXL was founded on the core values of innovation, collaboration, excellence, integrity and respect. Headquartered in New York, our team is over 45,400 strong, with more than 50 offices spanning six continents.
| Company 3 year performance | ||||||||||||||||||||||||
| Revenue (Year-over-year growth %) | ||||||||||||||||||||||||
| Revenue by segment information ($ in millions) | 2020 YOY% | 2021 YOY% | 2022 YOY% | |||||||||||||||||||||
Insurance | $341.8 | -1.3% | $382.0 | 11.8% | $448.7 | 17.5% | ||||||||||||||||||
Healthcare | 101.2 | 4.0% | 112.4 | 10.9% | 97.4 | -13.4% | ||||||||||||||||||
Emerging Business | 152.7 | -19.7% | 167.2 | 9.5% | 218.6 | 30.7% | ||||||||||||||||||
Analytics | 362.7 | 1.5% | 460.7 | 27.0% | 647.3 | 40.5% | ||||||||||||||||||
Consolidated | $958.4 | -3.3% | $1,112.3 | 17.1% | $1,412.0 | 25.8% | ||||||||||||||||||
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2023 Proxy Statement summary
| EXL 2023 Proxy Statement | / | 9 |
2023 Proxy Statement summary
| 10 | / | EXL 2023 Proxy Statement |
2023 Proxy Statement summary
Total stockholder return
The graphs below compare our 1-year, 3-year and 5-year cumulative total stockholder return (“TSR”) as of December 31, 2022 with the median TSR for companies comprising Nasdaq, S&P 600 and our peer group.
| 3-Year TSR
| 5-Year TSR
|
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| EXL 2023 Proxy Statement | / | 11 |
2023 Proxy Statement summary
Corporate governance highlights
The following information is based on our board profile immediately following our Annual Meeting (assuming the election of our seven director nominees), and reflects current board practices.
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/ | EXL 2023 Proxy Statement |
2023 Proxy Statement summary
| EXL 2023 Proxy Statement | / | 13 |
2023 Proxy Statement summary
Nominees for election as directors
| Name | Director since | Business Experience* | Committee membership | ||||
 |
Vikram Pandit Chairman |  2018 | Chairman and | Compensation and Talent Management Committee; Nominating and Governance Committee | |||
 |
Rohit Kapoor Vice Chairman |  2002 | |||||
Co-founded the Company in | None | ||||||
| January 2023 | Former Chairman and | Audit Committee; Nominating and Governance Committee | ||||
Som Mittal | December 2013 | Former Chairman and President of NASSCOM; various corporate leadership roles in the IT industry including at Wipro, Compaq, | Compensation and Talent Management Committee; Nominating and Governance Committee | ||||
Kristy Pipes | January 2021 | Former Chief Financial Officer of Deloitte Consulting; various leadership roles in the financial services industry, including at Transamerica Life Companies and First Interstate Bank of California | Audit Committee (Chair); Compensation and Talent Management Committee | ||||
Nitin Sahney | January 2016 | Founder and Chief Executive Officer of Pharmacord, LLC; former President and CEO of Omnicare Inc. | Nominating and Governance Committee (Chair); Audit Committee | ||||
Jaynie Studenmund
| September 2018 | Former Chief Operating Officer of Overture Services, Inc.; | Compensation and | Talent Management Committee (Chair); Audit Committee | |||
* A complete list of each nominee’s business experience and directorships is listed below beginning on page 20. | |||||||
| 14 | / | EXL 2023 Proxy Statement |
2023 Proxy Statement summary
Director nominees - skills matrix
 |  |  |  |  |  |  |  |  |  |  |  | |||||||||||||
| Finance and accounting | Executive leadership | Public company governance | Analytics | Human capital management | Digital operations and solutions | Marketing | Global experience | Risk oversight and management | Information and cyber security | ESG | Mergers acquisitions | |||||||||||||
Vikram Pandit | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ||||||||||||||||
Rohit Kapoor | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ||||||||||||||
Andreas Fibig | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | |||||||||||||||||
Som Mittal | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | |||||||||||||||
Kristy Pipes | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ||||||||||||||||
Nitin Sahney | ✓ | ✓ | ✓ | ✓ | ||||||||||||||||||||
Jaynie Studenmund | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | ✓ | |||||||||||||
Board statistics*
Board tenure
| Gender diversity
| Age distribution
|
Board independence
| Racial and ethnic diversity
|
*A complete list Following our Annual Meeting, assuming election of each nominee’s business experience and directorships is listed below on page 17.all nominees
| EXL 2023 Proxy Statement | / | 15 |
2023 Proxy Statement summary
Our Business purpose and core values
We are an operations management and analytics company
Sustainability
At EXL, we believe that helps businesses enhance revenue growth and improve profitability. Using proprietary platforms, methodologies and our full range of digital capabilities,there is always a better way; we look deeper, find it, and make it happen. This purpose informs our corporate culture, which, in turn, is rooted in our five core values. In line with our purpose, values and culture, we are committed to help companies transform their businesses, functionsfinding a better way through sustainability initiatives that are key to our long-term strategy and operations, to help them deliver better customer experiencebenefit our stockholders, clients, employees and business outcomes, while managing risk and compliance. We servecommunities. See “Sustainability” beginning on page 48 below for more details on our customersrecent accomplishments in the insurance, healthcare, travel, transportation and logistics, banking and financial services and utilities industries, among others. Headquartered in New York, we have approximately 29,100 professionals in locations throughout the United States, Europe, Asia (primarily India and the Philippines), Latin America, Australia and South Africa.sustainability.
Performance Highlights for 2018
Company 3 Year Performance Revenue and Segment Information ($ in millions) | ||||||||
| Revenue (Year-over-year growth %) | ||||||||
| 2016 | YOY% | 2017 | YOY% | 2018 | YOY% | |||
| Insurance Segment | $206.3 | 3.2% | $234.8 | 13.8% | $258.1 | 9.9% | ||
| Healthcare Segment | 68.7 | 24.4% | 77.0 | 12.2% | 84.4 | 9.6% | ||
| Travel, Transportation and Logistics Segment | 69.4 | 11.4% | 71.0 | 2.3% | 70.2 | -1.0% | ||
| Finance and Accounting Segment | 79.4 | 1.2% | 86.5 | 9.0% | 97.9 | 13.2% | ||
| All Other | 96.5 | -12.7% | 83.1 | -13.9% | 87.2 | 4.8% | ||
| Analytics Segment | 165.7 | 35.7% | 209.9 | 26.7% | 285.3 | 35.9% | ||
| Consolidated | $686.0 | 9.1% | $762.3 | 11.1% | $883.1 | 15.8% | ||
We improved our annual revenues from $762.3 million in fiscal year 2017 to $883.1 million in fiscal year 2018, and also achieved numerous other successes, including the acquisition of a healthcare analytics company and a $150 million strategic investment in our Company by The Orogen Group. For more information regarding these and other business highlights, please see page 35 below and the 2018 Form 10-K.
The graphs below compare our 1-year, 3-year and 5-year total stockholder return (“TSR”) with that of the companies comprising Nasdaq, S&P 500 and our peer group. As shown in the table, our 3-year TSR outperformed all but one of our market benchmarks while our 5-year TSR outperformed all of our market benchmarks.
(1) Cumulative growth rate as of December 31, 2018.
(2) Peer group TSR data excludes Convergys Corporation, which was acquired in October 2018, and DST Systems, which was acquired in April 2018.
2018 Compensation Highlights
| 16 | / | EXL 2023 Proxy Statement |
2023 Proxy Statement summary
2022 Compensation highlights
Named Executive Officers
| Name | Title | |
Rohit Kapoor | Vice Chairman and CEO | |
Maurizio Nicolelli | Executive Vice President and CFO | |
Vikas Bhalla | Executive Vice President and | |
Vivek Jetley | Executive Vice President and Business Head, Analytics | |
Ankor Rai | Executive Vice President and Chief | |
2022 Standard annual compensation
| 2018 Standard Annual Compensation | |||||
| Compensation Component | Rohit Kapoor | Vishal Chhibbar | Pavan Bagai | Nagaraja Srivatsan | Nalin Miglani |
| Salary | $720,000 | $437,671 | $301,448 | $441,370 | $440,137 |
| Non-Equity Incentive Plan Compensation | 532,748 | 173,210 | 133,946 | 172,987 | 164,579 |
| Equity Awards | 3,791,277 | 928,709 | 1,339,363 | 753,076 | 809,936 |
| Other Compensation(1) | 61,484 | 11,465 | 74,407 | 8,640 | 8,640 |
| Total | $5,105,509 | $1,551,056 | $1,849,164 | $1,376,073 | $1,423,292 |
| Compensation component | Rohit Kapoor | Maurizio Nicolelli | Vikas Bhalla(3) | Vivek Jetley | Ankor Rai | |||||||||||||||
| Salary | $766,384 | $483,822 | $265,432 | $440,164 | $420,082 | |||||||||||||||
| Non-equity incentive plan compensation | 1,829,887 | 554,929 | 357,340 | 525,488 | 481,822 | |||||||||||||||
| Equity awards (1) | 8,356,213 | 1,810,865 | 1,964,960 | 1,862,689 | 1,553,192 | |||||||||||||||
| Other compensation (2) | 58,423 | 9,654 | 38,432 | 9,654 | 9,654 | |||||||||||||||
| Total | $11,010,906 | $2,859,270 | $2,626,165 | $2,837,996 | $2,464,750 | |||||||||||||||
(1) Equity award values reflect equity grants in 2022 based on the grant date fair value of awards in accordance with FASB ASC Topic 718.
(2) For each named executive officer, this category includes, if applicable, his perquisites and personal benefits, hiring bonus, changes in pension value, Company-paid life insurance premiums and Company contributions to our 401(k) plan. A detailed discussion of the compensation components for each named executive officer for fiscal year 2022 is provided in the “Summary compensation table for fiscal year 2022” beginning on page 87.
(3) Mr. Bhalla is based in Delhi, India. Certain of his compensation components, as described herein, are paid in Indian rupees (INR), and are converted for comparison purposes at 82.72 INR to 1 U.S. Dollar (USD), which was the exchange rate on December 30, 2022.
On an annual basis, we submit to our stockholders a vote to approve, on a non-binding advisory basis, the compensation of our named executive officers as described in this proxy statement.Proxy Statement. We refer to this vote as “say-on-pay”“say-on-pay”. Please refer to our Compensation Discussion and Analysis, startingbeginning on page 3563 for a complete description of our 20182022 compensation program.
Below are a few highlights of our executive compensation:
Compensation philosophy: Our executive compensation philosophy is focused on pay-for-performance and is designed to reflect appropriate governance practices aligned with the needs of |
| EXL 2023 Proxy Statement | / | 17 |
2023 Proxy Statement summary
| • | 99% Say-on-Pay approval of 2021 compensation: At our |
Annual |
| – | Company-wide metrics (75%)—Revenue and adjusted operating profit |
| – |
Individual |
Long-term equity incentive program: We also continued our equity incentive program, which includes granting a balanced mix of time-vested restricted stock units and performance-based restricted stock units. The performance-based restricted stock units were comprised |
2022 performance: We delivered the following revenue and |
| – | Annual |
| – | Equity |
| 18 | / | EXL 2023 Proxy Statement |
2023 Proxy Statement summary
Compensation Mix:mix
Vice Chairman & CEO compensation mix | NEO (Excluding Vice Chairman & CEO) | |
| ||
 | 
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Auditor Matters
As a matter of good corporate practice, we are seeking your ratification of Deloitte & Touche LLP as our independent registered public accounting firm for fiscal year 2019. The following sets forth fees of Deloitte & Touche LLP, who served as our independent registered public accounting firm for fiscal year 2018.
2018 (in thousands) | ||
| Audit Fees | $ | 1,425 |
| Audit-Related Fees | — | |
| Tax Fees | 523 | |
| All Other Fees | 54 | |
| Total | $ | 2,002 |
For more information on our auditors, including individual components of 2018 audit fees and our change in auditors, see page 82.
INFORMATION CONCERNING VOTING AND SOLICITATION
This Proxy Statement is being furnished to you in connection with the solicitation by the board of directors of ExlService Holdings, Inc., a Delaware corporation (“us,” “we,” “our” or the “Company”), of proxies to be used at our 2019 Annual Meeting of Stockholders (the “Annual Meeting”) to be held at the New York offices of the Company, 320 Park Avenue, 29th Floor, New York, New York, 10022 on June 17, 2019, at 8:30 AM, Eastern Time, and any adjournments or postponements thereof.
In accordance with rules and regulations adopted by the Securities and Exchange Commission (the “SEC”), instead of mailing a printed copy of our proxy materials to each stockholder of record, the Company furnishes proxy materials via the Internet. If you received a Notice of Internet Availability of Proxy Materials (the “Internet Notice”) by mail, you will not receive a printed copy of our proxy materials other than as described herein. Instead, the Internet Notice will instruct you as to how you may access and review all of the important information contained in the proxy materials. The Internet Notice also instructs you as to how you may submit your proxy over the Internet or by phone. If you received an Internet Notice by mail and would like to receive a printed copy of our proxy materials, you should follow the instructions for requesting proxy materials included in the Internet Notice.
It is anticipated that the Internet Notice will be sent to stockholders on or about April 26, 2019. This proxy statement and the form of proxy relating to the Annual Meeting will be made available via the Internet to stockholders on or prior to the date that the Internet Notice is first sent.
Who Can Vote
Only stockholders who own shares of our common stock at the close of business on April 18, 2019, the record date for the Annual Meeting, can vote at the Annual Meeting. As of the close of business on April 18, 2019, the record date, we had [___________] shares of common stock outstanding and entitled to vote. Each holder of common stock is entitled to one vote for each share held as of the record date for the Annual Meeting. There is no cumulative voting in the election of directors.
How You Can Vote
If your shares are registered directly in your name with Computershare Trust Company, N.A., our transfer agent (which means you are a “stockholder of record”), you can vote your proxy by (i) Internet, (ii) by phone or (iii) by requesting that proxy materials be sent to you by mail that will include a proxy card that you can use to vote by completing, signing, dating and returning the proxy card in the prepaid postage envelope provided. Please refer to the specific instructions set forth in the Internet Notice. You will not be able to vote your shares unless you use one of the methods above to designate a proxy or by attending the Annual Meeting.
If you are the beneficial owner of shares held in the name of a brokerage, bank, trust or other nominee as a custodian (also referred to as shares held in “street name”), your broker, bank, trustee or nominee will provide you with materials and instructions for voting your shares. In addition to voting by mail, a number of banks and brokerage firms participate in a program provided through Broadridge Financial Solutions, Inc. (“Broadridge”) that offers telephone and Internet voting options. Votes submitted by telephone or by using the Internet through Broadridge’s program must be received by 11:59 p.m. Eastern Time, on June 16, 2019.
Voting at the Annual Meeting
Voting by Internet, phone or mail will not limit your right to vote at the Annual Meeting if you decide to attend in person. Our board of directors recommends that you vote by Internet, phone or mail as it is not practical for most stockholders to attend the Annual Meeting. If you are a “stockholder of record,” you may vote your shares in person at the Annual Meeting. If you hold your shares in “street name,” you must obtain a proxy from your broker, bank, trustee or nominee giving you the right to vote the shares at the Annual Meeting or your vote at the Annual Meeting will not be counted.
Revocation of Proxies
You can revoke your proxy at any time before it is exercised in any of the following ways:
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Required Vote; Effect of Abstentions and Broker Non-Votes
Quorum
A quorum, which is a majority of the issued and outstanding shares of our common stock as of April 18, 2019, must be present, in person or by proxy, to conduct business at the Annual Meeting. A quorum is calculated based on the number of shares represented by the stockholders attending the Annual Meeting in person and by their proxy holders. If you indicate an abstention as your voting preference for all matters to be acted upon at the Annual Meeting, your shares will be counted toward a quorum but they will not be voted on any matter.
Proposal 1: Amendment of the Amended and Restated Certificate of Incorporation to Effect a Phased Declassification of the Board of Directors over the Next Three Years
We are seeking approval of an amendment of Section 6 of our Amended and Restated Certificate of Incorporation to declassify the board over a three-year phase out period (see page 78 below), which when completed will allow for the election of all directors on an annual basis. This requires the affirmative vote of the holders of at least 66 2/3% of the voting power of the then-outstanding shares of the Company, voting together as a single class. For purposes of the vote on Proposal 1, abstentions and broker non-votes (as described below) will have the effect of a vote against Proposal 1.
Proposal 2: Election of Directors
Under our Fourth Amended and Restated By-Laws (our “by-laws”), directors who are standing for election at the Annual Meeting will be elected by the affirmative vote of a majority of votes cast (meaning the number of shares voted “for” a nominee must exceed the number of shares voted “against” such nominee) by stockholders in person or represented by proxy and entitled to vote at the Annual Meeting. If any incumbent nominee for director receives a greater number of votes “against” his or her election than votes “for” such election, our by-laws provide that such person shall tender to the board of directors his or her resignation as a director. You may cast your vote in favor of electing all of the nominees as directors, against one or more nominees, or abstain from voting your shares. For purposes of the vote on Proposal 2, abstentions and broker non-votes will have no effect on the results of the vote.
Other Proposals
The ratification of the appointment of our independent registered public accounting firm, the advisory (non-binding) approval of the compensation of our named executive officers and each other item to be acted upon at the Annual Meeting will require the affirmative vote of a majority of shares present in person or represented by proxy and entitled to vote at the Annual Meeting. You may cast your vote in favor of or against these proposals or you may abstain from voting your shares. For purposes of the vote on Proposals 3 (ratification of the appointment of our independent registered public accounting firm), 4 (advisory (non-binding) vote on executive compensation), or such other items properly presented and to be acted upon at the Annual Meeting, abstentions will have the effect of a vote against these proposals. Broker non-votes will have the effect of a vote against Proposal 4, but because Proposal 3 is a “routine” proposal where brokers have discretionary authority to vote in the absence of instruction, there will be no broker non-votes.
If you submit your proxy, but do not mark your voting preference, the proxy holders will vote your shares (i) FOR the amendment of the amended and restated certificate of incorporation, (ii) FOR the election of the Class I nominees for director, (iii) FOR the ratification of the appointment of our independent registered public accounting firm, (iv) FOR the approval on an advisory (non-binding) basis of the compensation of our named executive officers, and (v) as described below, in the judgment of the proxy holder on any other matters properly presented at the Annual Meeting.
Shares Held in “Street Name” by a Broker
If you are the beneficial owner of shares held in “street name” by a broker, then your broker, as the record holder of the shares, must vote those shares in accordance with your instructions. If you fail to provide instructions to your broker, under the New York Stock Exchange rules (which apply to brokers even though our shares are listed on the NASDAQ Stock Market), your broker will not be authorized to exercise its discretion and vote your shares on “non-routine” proposals, including the election of directors and approval on an advisory (non-binding) basis of the compensation of our named executive officers. As a result, a “broker non-vote” occurs. However, without your instructions, your broker would have discretionary authority to vote your shares only with respect to “routine” proposals, which at the Annual Meeting is the ratification of the appointment of our independent registered public accounting firm.
Other Matters to Be Acted Upon at the Meeting
Our board of directors presently is not aware of any matters, other than those specifically stated in the Notice of Annual Meeting, which are to be presented for action at the Annual Meeting. If any matter other than those described in this proxy statement is presented at the Annual Meeting on which a vote may properly be taken, the shares represented by proxies will be voted in accordance with the judgment of the person or persons voting those shares.
Adjournments and Postponements
Any action on the itemsOur board of business described above may be considered at the Annual Meeting at the time and on the date specified above or at any time and date to which the Annual Meeting may be properly adjourned or postponed.
Solicitation of Proxies
We will pay the cost of printing and mailing proxy materials and posting them on the Internet. Upon request, we will reimburse brokers, dealers, banks and trustees, or their nominees, for reasonable expenses incurred by them in forwarding proxy materials to beneficial owners of shares of our common stock.
Internet Availability of Proxy Materials
Our Notice of Annual Meeting, proxy statement and form of proxy card are each available atwww.proxyvote.com. You may access these materials and provide your proxy by following the instructions provided in the Internet Notice.
Important
Please promptly vote and submit your proxy by (i) Internet (by following the instructions provided in the Internet Notice), (ii) by phone (by following the instructions provided in the Internet Notice) or (iii) by requesting that proxy materials be sent to you by mail that will include a proxy card that you can use to vote by completing, signing, dating and returning the proxy card in the prepaid postage envelope provided. This will not limit your right to attend or vote at the Annual Meeting. All Annual Meeting attendees may be asked to present valid, government-issued photo identification (federal, state or local), such as a driver’s license or passport, and proof of beneficial ownership if you hold your shares through a broker, bank, trust or other nominee (or a proxy signed by a stockholder of record delegating voting authority to the attendee), before entering the Annual Meeting. Attendees will be required to sign in, and may be subject to security inspections. Video and audio recording devices and other electronic devices will not be permitted at the Annual Meeting.
If you have any further questions about voting your shares or attending the Annual Meeting, please call our Investor Relations Department at (212) 624-5913.
directors
Our board of directors currently consists of tennine directors divided into three classes, with each(including our seven director serving a three-year termnominees, and one class being elected at each year’s annual meeting of stockholders.* The current compositiontwo of our directors who currently serve on the board, of directors is as follows:but will not stand for reelection) with diverse experience, including in analytics, digital operations and solutions, client industries, information and cybersecurity, human capital management, ESG, and finance and accounting, among others.
From left: Clyde Ostler* (Independent Director), Nitin Sahney (Independent Director and Nominating and Governance Committee Chair), Kristy Pipes (Independent Director and Audit Committee Chair), Rohit Kapoor (Vice Chairman and CEO), Jaynie Studenmund (Independent Director and Compensation and Talent Management Committee Chair), Andreas Fibig (Independent Director), Vikram Pandit (Independent Chairman), Som Mittal (Independent Director), Anne Minto* (Independent Director)
* Not standing for reelection
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| EXL 2023 Proxy Statement |
Our board of directors
Board diversity matrix
2023 Board diversity matrix (as of April 28, 2023)*
Total number of directors: | 9 | |||
| Female | Male | |||
| Part I: Gender identity | ||||
Directors | 3 | 6 | ||
| Part II: Demographic background | ||||
Asian | — | 4 | ||
White (other than Middle Eastern) | 3 | 2 | ||
* Subject to approval by the Company’s stockholders of Proposal 1Includes our nine current directors, including our seven nominees for election at the Annual Meeting, theMeeting.
2022 Board diversity matrix (as of April 28, 2022)
Total number of directors: | 9 | |||
| Female | Male | |||
| Part I: Gender identity | ||||
Directors | 3 | 6 | ||
| Part II: Demographic background | ||||
Asian | — | 4 | ||
White (other than Middle Eastern) | 3 | 2 | ||
| EXL 2023 Proxy Statement | / | 21 |
Our board of directors will be declassified and elected annually over a three-year phase-out period.
**Mr. Pandit was appointed to the board as a Class III director under the terms of an Investment Agreement as described on page 16 below.
2019 Nominees
Director nominees for election at the Annual Meeting
Upon the recommendation of our Nominating and Governance Committee, we are pleased to propose seven of our three (3) existing Class I directors as nominees for re-electionelection as directors at the Annual Meeting. As previously disclosed, two of our current directors, Ms. Minto and Mr. Ostler, will not be standing for re-election at the Annual Meeting; the remaining seven directors are our director nominees at the Annual Meeting.
If Proposal 1 is approved by the Company’s stockholders,upon the filing of the amendment to the certificate of incorporation set forth on Appendix A attached hereto, the classificationThe following tables provide a summary of our board composition by age, gender, tenure and independence immediately after our Annual Meeting (assuming the election of all nominees).
| Age distribution | Gender diversity | Board tenure | Board independence | |||
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Our nominees for re-election as directors will be phased out over the next three Annual Meetings of Stockholders, such that directors will be elected annually. Accordingly, (i) at the Annual Meeting each of the Class I director nominees elected by our stockholders will be elected to hold office for a term of one year, or until their successors are duly elected and qualified in accordance with our by-laws, (ii) at the 2020 Annual Meeting of Stockholders, each of the Class I and Class II director nominees elected by our stockholders will be elected to hold office for a term of one year, or until their successors are duly elected and qualified in accordance with our by-laws, and (iii) at the 2021 Annual Meeting of Stockholders, each of Class I, Class II and Class III director nominees elected by our stockholders will be elected to hold office for a term of one year, or until their successors are duly elected and qualified in accordance with our by-laws, and thereafter the classification of the board of directors will terminate in its entirety. As such, if elected, each of the Class I director nominees will serve a term or one year on our board of directors, until our 2020 Annual Meeting of Stockholders or until their successors are duly elected and qualified in accordance with our by-laws.as follows:
If Proposal 1 is not approved by the Company’s stockholders, and if elected, each of the Class I director nominees will serve a term of three years on our board of directors, until our 2022 Annual Meeting of Stockholders or until their successors are duly elected and qualified in accordance with our by-laws.
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and Independent Director | |||||
| Rohit Kapoor Vice Chairman and CEO and Director | |||||
| Andreas Fibig Independent Director |
| Som Mittal Independent Director | |||
| Kristy Pipes Independent Director and Chair of the Audit Committee |
| Nitin Sahney Independent Director and Chair of the Nominating and Governance Committee | |||
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| Jaynie Studenmund Independent Director and Chair of the Compensation and Talent Management Committee | |||||
We believe that our director nominees and continuing directors, individually and together as a whole, possess the requisite skills, experience and qualifications necessary to maintain an effective board to serve the best interests of the Company and its stockholders.stockholders described below under “Director qualifications” (see pages 34-35).
| 22 | / | EXL 2023 Proxy Statement |
Director QualificationsOur board of directors
The board of directors considers it paramount to achieving excellence in corporate governance to assemble a board of directors that, taken together, has the skills, qualifications, experience and attributes appropriate for functioning as the board of directors of our Company and working productively with management. The Nominating and Governance Committeename, age (as of the Board is responsible for recommending nominees that are qualified and that bring a diverse setdate of skills and qualifications to oversee the Company effectively.
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The Nominating and Governance Committee has not formally established any minimum qualifications for director candidates. However, in light of our business, the primary areas of experience, qualifications and attributes typically sought by the Nominating and Governance Committee in director candidates include, but are not limited to, the following primary areas:
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We note that, in addition to satisfying these general qualifications considered by the Nominating and Governance Committee in connection with a director nomination, Vikram S. Pandit was appointed to the Board on October 4, 2018 as a Class III director pursuant to the terms of an Investment Agreement, dated as of October 1, 2018 (the “Investment Agreement”)this Proxy Statement), between the Company and Orogen Echo LLC, an affiliate of The Orogen Group LLC (the “Purchaser”). The Investment Agreement was entered into in connection with our issuance to the Purchaser of $150,000,000 in aggregate principal amount of 3.50% Convertible Senior Notes due October 1, 2024 (the “notes”). For so long as the Purchaser has the right to nominate a director to the Board under the Investment Agreement, we have, subject to the terms of the Investment Agreement, agreed to include such person in our slate of nominees for election to our board of directors at each of our annual meetings of stockholders at which directors are to be elected, and to use our reasonable best efforts to cause the election of such person to our board of directors. The Purchaser’s right to nominate a director will terminate if Purchaser and its affiliates beneficially own less than 50% of the number of shares of our common stock deemed beneficially owned by the Purchaser and its affiliates immediately following the issuance of the notes (which, for purposes of the Investment Agreement, includes shares of our common stock issuable upon conversion of the notes).
Board of Directors
The names, ages and principal occupations (which have continued for at least the past five years unless otherwise indicated)occupation and other information, including the specific experience, qualifications, attributes or skills that led to the conclusion that such person should serve as a director of the Company, with respect to each of the nominees and continuing directors are set forth below. There are no family relationships among any of our directors or executive officers.
Class I Directors (Terms ExpiringNominees for election at the Annual Meeting)Meeting - Biographical information
Vikram S. Pandit Director since October 2018 | Chairman of the Board since 2022 | Independent |
| Age: 66 — is Chairman and Chief Executive Officer of The Orogen Group, which makes significant long-term strategic investments in financial services companies and related businesses. Mr. Pandit’s business experience and directorships are detailed below. The Company has concluded, based in part on Mr. Pandit’s more than 30 years of experience in the financial services industry, including his experience as Chief Executive Officer, and a member of the board of directors, of Citigroup Inc. (NYSE: C), that Mr. Pandit should serve as a director. Committees: • Compensation and Talent Management (from March 2023); Nominating and Governance • Audit* (through February 2023) Business experience • Chairman and Chief Executive Officer, The Orogen Group LLC (July 2016 - present) • Chairman, TGG Group (February 2014 - June 2016) • Chief Executive Officer, Citigroup Inc. (December 2007 - October 2012) Public directorships during past five years • ��Director and member of the nominating and governance and finance committees, Virtusa Corporation (NASDAQ: VRTU) (2017 - 2021) • Lead Independent Director, chair of the human resources and compensation committee and member of the corporate governance and nominating committee, former member of the audit committee, Bombardier Inc. (TSX: BBD) (2014 - 2021) Other relevant experience • Director, Citigroup Inc. (December 2007 - October 2012) • Director, Fair Square Financial Holdings (2017 - 2021) • Director, Westcor Land Title Insurance Company (2020 - present) • Chairman, JM Financial Credit Solutions Ltd. (2014 - present) • Member of the Board of Overseers of Columbia Business School • Member of the Board of Visitors of Columbia School of Engineering and Applied Science | |||||
| SKILLS | ||||||
| Finance and accounting | |||||
| Executive leadership (within the last 5 years) | |||||
| Public company governance | |||||
| Analytics | |||||
| Human capital management | |||||
| Digital operations and solutions | |||||
| Global experience | |||||
| Mergers and acquisitions | |||||
* Audit committee financial expert under applicable SEC rules and regulations
| EXL 2023 Proxy Statement | / | 23 |
Our board of directors
Rohit Kapoor Director since November 2002 | Vice Chairman and CEO since April 2012 | Non-independent |
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| Age: | |||||
Committees:N/A |
Business Experience
Business experience at the Company
•Vice Chairman and CEO (2012 |
•President and CEO (2008 |
•Various senior leadership roles, including CFO and COO (2000 |
Other Business Experience
Other business experience •Business head, Deutsche Bank, a financial services provider |
| (1999 - 2000) •Various capacities at Bank of America in the United States and Asia, including India |
Public Directorships during Past Five Years(1991 - 1999)
Public directorships during past five years • Lead independent director, director and member of the audit committee, CA Technologies, Inc. (NASDAQ: CA), a software services company Other relevant experience • Member, Board of Directors, American India Foundation (AIF) • Member, Board of Directors, Pratham (Tristate Chapter) | ||||
SKILLS | ||||
| Finance and accounting | |||
| Executive leadership (within the last 5 years) | |||
| Public company governance | |||
| Analytics | |||
| Human capital management | |||
| Digital operations and solutions | |||
| Marketing | |||
| Global experience | |||
| Risk oversight and management | |||
| Mergers and acquisitions | |||
Other Relevant Experience
| 24 | / | EXL 2023 Proxy Statement |
Our board of directors
Andreas Fibig Director since | Independent |
 | ||||||
| Age: Committees: • Audit Committee; Nominating and Governance Committee Business experience • Chairman and Chief Executive Officer, International Flavors & Fragrances, Inc., a food ingredients, beverage, scent, healthcare and biosciences company (2014 - 2022) • President and Chairman of the Board of Management, Bayer Healthcare Pharmaceuticals, LLC a global pharmaceutical company (2008 - 2014) • Senior Vice President/General Manager and various leadership positions, Pfizer, Inc., a multinational pharmaceutical and biotechnology company (2000 - 2008)) Public directorships during past five years • Director, International Flavors & Fragrances, Inc. (2011 - 2022, Chairman from 2014 - 2022) • Independent director and member of the • Independent director and member of the audit committee and finance and risk policy committee, Bunge Limited (NYSE: BG), a global agribusiness and food company (2016 - 2018) Other relevant experience • Director, Indigo Agriculture, an agricultural technology company (2022 - present) • Director, EvodiaBio, a bioindustrial aroma company (2022 - present) | |||||
SKILLS | ||||||
| Executive leadership (within the last 5 years) | |||||
| Public company governance | |||||
| Human capital management | |||||
| Marketing | |||||
| Global experience | |||||
| ESG | |||||
| Mergers and acquisitions | |||||
| EXL 2023 Proxy Statement | / | 25 |
Our board of directors
Som Mittal Director since December 2013 | Independent |
| Age: 71 — has held various corporate leadership roles in the IT industry since 1989 and also has extensive experience in the engineering and automotive sectors. His business experience and directorships are detailed below. The Company has concluded, based in part on Mr. Mittal’s business experience as President of NASSCOM, his knowledge of the global outsourcing industry and his expertise in corporate sustainability and responsibility, that Mr. Mittal should serve as a director. Committees: • Compensation and Talent Management, Nominating and Governance Business experience • Chairman and President, NASSCOM, a trade body for the IT and business process management industries in India (2008 - 2014) • Prior leadership roles at Wipro, Digital, Compaq and HP • Prior executive roles at Larsen and Toubro, Escorts and Denso Public directorships during past five years • Director, Sasken Technologies Limited (NSE: SASKEN), a telecommunications company (2022 - present) • Director and member of clinical quality and innovation committee, Apollo Hospitals Enterprise Limited (NSE: APOLLOHOSP), a healthcare services provider (2021 - present) • Director and chairman of audit committee, Sheela Foam Ltd. (NSE: SFL), a manufacturing company (2016 - present) • Director and member of audit and risk management committee, Cyient Ltd. (NSE: CYIENT), an engineering design services company (2014 - 2022) • Director and chairman of customer service committee and IT strategy committee, member of nomination and remuneration committee and other committees, Axis Bank, Ltd. (NSE: Axis), a financial services company (2011 - 2019) Other directorships • Director, Tata SIA Airlines, Ltd., an Indian airline joint venture between TATA and Singapore Airlines with Indian and international operations (2015 - present) • Non executive Independent Director and Chairman, Vodafone India Services India Pvt Ltd., an Indian shared services company that is wholly owned, operated and controlled by Vodafone Group Plc (“Vodafone”) and provides information technology and networks services, among others, to Vodafone (2020 - present) Other relevant experience • Former member, Board of Governors, Indian Institute of Corporate Affairs • Former Committee Member, Indian Prime Minister’s National e-Governance Program • Member of the governing body of Axis Bank Foundation, a non-profit organization, and member of board of governors of academic institutions | |||||
| SKILLS | ||||||
| Finance and accounting | |||||
| Executive leadership | |||||
| Public company governance | |||||
| Human capital management | |||||
| Digital operations and solutions | |||||
| Global experience | |||||
| Risk oversight and management | |||||
| Information and cybersecurity | |||||
| ESG | |||||
| 26 | / | EXL 2023 Proxy Statement |
Our board of directors
Kristy Pipes Director since January 2021 | Independent |
| Age: 64 — is a leader in the professional services industry. Ms. | |||||
Committees: • Audit (Chair)*; Compensation |
Business Experience
Business experience • Chief Financial Officer, member of the |
• Vice President and Manager, Finance Division, Transamerica Life Companies (1997 - 1999) • Senior Vice President and Chief of Staff for the President and CEO, among other senior management Public directorships during past five years • Director and |
Public Directorships During the Past Five Years
•Director • Director and chair of the audit committee, and member of the Other relevant experience • Director and chair of the audit committee, and member of the nominating, governance, and sustainability committee, Savers, Inc., one of the world’s largest thrift retailers | ||||
SKILLS | ||||
| Finance and accounting | |||
| Executive leadership (within the last 5 years) | |||
| Public company governance | |||
| Analytics | |||
| Human capital management | |||
| Global experience | |||
| Risk oversight and management | |||
| Information and cybersecurity | |||
Other Relevant Experience
* Audit committee financial expert under applicable SEC rules and regulations.
| EXL 2023 Proxy Statement | / | 27 |
Our board of directors
Nitin Sahney Director since January 2016 | Independent | |||
| Age: 60 — Is a leader in the healthcare industry with over 25 years of experience across all areas of healthcare. Mr. Sahney’s business experience and directorships are detailed below. The Company has concluded, based in part on Mr. Sahney’s experience as CEO of PharmaCord and Omnicare, Inc. and his expertise in the healthcare industry garnered from more than two decades of experience, that Mr. Sahney should serve as a director. Committees: • Nominating and Governance (Chair); Audit* Business experience • Founder, Member-Manager and Chief Executive Officer, PharmaCord, LLC, a company that helps biopharma manufacturers address product access hurdles (2016 - present) • Operating Advisor, Clayton Dubilier & Rice Funds, a private equity firm (2016 - 2017) • President and CEO (2014 - 2015) and President and COO (2012 - 2014) of Omnicare Inc., a former New York Stock Exchange-listed Fortune 500 company in the long-term care and specialty care industries • Manager of a healthcare investment fund (2008 - 2010) • Founder and CEO of RxCrossroads, a specialty pharmaceutical company (2001 - 2007) • Prior leadership positions with Cardinal Healthcare, a global healthcare services and products company Public directorships during past five years • Director and member of the audit committee and the nominating and governance committee, Option Care Health, Inc. (NASDAQ: OPCH) (2019 - present) Other relevant experience • Member of the Board of Trustees, University of | |||
| SKILLS Finance and | |||
| Executive leadership (within the last 5 years) | |||
| Public company governance | |||
| Mergers and acquisitions | |||
* Audit committee financial expert under the applicable SEC rules and regulations
| 28 | / | EXL 2023 Proxy Statement |
Our board of directors
Jaynie M. Director since September 2018 | ||||
Independent | ||||
| Age: | |||
Committees: • Compensation and Talent Management (Chair), |
Business Experience
Business experience •Chief Operating Officer, Overture Services, a pioneer in paid search and search engine marketing |
| (2001 - 2004) •President & Chief Operating Officer, PayMyBills, the leading consumer bill payment and presentment company (1999 |
•Previously for over two decades served as Executive Vice President and Head of Consumer |
Public Directorships During the Past Five YearsCalifornia following the era of bank consolidation.
• Management Consultant, Booz, Allen & Hamilton Public directorships during past five years •Director and |
•Director and member of the contracts committee, audit committee and nomination and governance committee, Western Asset Management |
| (2004 - present) • Director and chair of the compensation committee and member of the nominating and governance committee, CoreLogic, Inc. (NYSE: CLGX) until its acquisition in 2021 (2012 - 2021) •Director, compensation committee chair and member of the compliance committee, Pinnacle Entertainment (Nasdaq: PNK) until its acquisition in 2018 (2012 |
Other relevant experience • Member of the National Association of Corporate Directors (“NACD”) Directorship 100, 2021, as one of the top public company directors in the U.S.; Named to Women Inc.’s 2019 Most Influential Corporate Directors listing • Board chair emeritus and life trustee, Huntington Health, an affiliate of Cedars Sinai Health • Trustee and board member, and member of the finance, audit |
Other Relevant Experience
SKILLS |
| Finance and accounting | |
| Executive leadership | |
| Public company governance | |
| Analytics | |
| Human capital management | |
| Digital operations and solutions | |
| Marketing | |
| Global experience | |
| Risk oversight and management | |
| ESG | |
| Mergers and acquisitions | |
*Audit committee financial expert under applicable SEC rules and regulations.
Class II Directors (Terms Expiring in 2020)
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Business Experience
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Public Directorships During Past Five Years
Other Directorships
Other Relevant Experience
*Audit committee financial expert under applicable SEC rules and regulations.
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Business Experience
Public Directorships During Past Five Years
Other Directorships
Other Relevant Experience
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Business Experience
Public Directorships During the Past Five Years
Other Directorships
*Audit committee financial expert under applicable SEC rules and regulations.
Class III Directors (Terms Expiring in 2021)
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Business Experience
Public Directorships during Past Five Years
Other Directorships
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Business Experience
Public Directorships During the Past Five Years
Other Relevant Experience
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Business Experience
Other Relevant Experience
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Business Experience
Public Directorships during Past Five Years
Other Directorships
Other Relevant Experience
CORPORATE GOVERNANCECorporate governance
Corporate governance
Director Independence
independence
In determining director independence, the board of directors considered the transactions and relationships set forth below under “Certain Relationships and Related Person Transactions—Related Party Transactions.” Transactions” and routine service arrangements between the Company and Westcor Land Title Insurance Company (“Westcor”). During 2022, one of our directors, Mr. Pandit, served as a non-executive director and, through his ownership in The Orogen Group (see below for information on Mr. Pandit’s relationship with The Orogen Group), owned an immaterial indirect equity interest, in Westcor. Mr. Pandit is not, and was not during 2022, a partner, controlling shareholder or executive officer of Westcor.
Based on its review of all applicable relationships, our board of directors has determined that all of the members on our board of directors, other than Mr. Kapoor, meet the independence requirements of the Nasdaq Stock Market and federal securities laws.
Meeting Attendanceattendance
OurWe expect our directors are expected to attend all board of directors meetings and meetings of committees on which they serve. Directors areWe also expectedexpect our directors to spend sufficient time and meet as frequently as necessary to discharge their responsibilities properly. Each member of our board of directors attended at least 75% of the aggregate meetings of our board of directors and the committees on which they served during 2018. It is our policy that all of our directors standing for election should attend our Annual Meetings of Stockholders absent exceptional cause. All
Incumbent director meeting attendance
Board and committee meetings in 2022
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| Board meetings | Audit Committee meetings | Compensation and Talent Management Committee meetings | Nominating and Governance Committee meetings | |||||||||||||||
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Corporate governance
Corporate governance framework
The board is responsible for providing governance and oversight over the effectiveness of policy and decision-making with respect to the persons who were membersstrategy, operations and management of EXL, in order to enhance our financial performance and stockholder value over the board of directors atlong term.
Our board’s commitment to strong corporate governance is informed by the timefive core values of our 2018 Annual Meeting of Stockholders attended such meeting.corporate culture: innovation, respect, integrity, excellence and collaboration. Our board seeks to maintain best practices in corporate governance by reviewing and updating our governance policies, as appropriate, at least annually, and provides oversight over our risk management and strategic planning as relates to our growth, human capital management, and environmental, social and governance matters, each as discussed further below.
Our Corporate Governance Guidelines and other governance policies, including our committee charters and Code of Conduct and Ethics, codify our corporate governance framework. | ||||||||
The Corporate Governance Guidelines address Board responsibilities and conduct, director qualifications and membership matters, director orientation and continuing education, Board and committee meetings, and share ownership by non-management directors, among other topics. | Our Code of Conduct and Ethics is applicable to our directors, officers and fully and part-time employees, and anyone who works on EXL’s behalf, including suppliers, subcontractors and partners, and details how they should conduct themselves when dealing with fellow employees, clients, suppliers, partners, competitors and the general public. Our Code of Conduct and Ethics is reviewed annually by the Audit Committee and audited periodically as part of our compliance and legal audits. Our personnel receives periodic training on the Code. We encourage our employees to speak up and raise concerns promptly about any situation that they believe may violate our Code of Conduct and Ethics or the law and we are committed to responding promptly to any concerns. Our Corporate Governance Guidelines, committee charters, and other corporate governance policies are all available on our website at https://ir.exlservice.com/corporate-governance. | |||||||
Our committee charters specifically set out the authority and responsibilities of the Committees of the board. | ||||||||
| EXL 2023 Proxy Statement |
| 31 |
Board Leadership StructureCorporate governance
OurBeyond the board of directors is currently led by Garen K. Staglin, our Chairman, and Rohit Kapoor, our Vice Chairman and CEO.room
Director onboarding | ||||||||||
| All new directors participate in an orientation program shortly after their election or appointment, which is overseen by the Nominating and Governance Committee. New directors | |||||||||
| | participate in site visits and presentations by senior management. By the end of orientation, our new directors are familiar with our: • strategic and business plans • significant financial, accounting and risk management • compliance programs, and • corporate governance framework. | |||||||||
Employee and stockholder engagement | ||||||||||
| Our directors are generally invited to visit any EXL office and have complete and open access to our management and employees. | |||||||||
| | They also take part in EXL company initiatives in which they can engage with our employees, stakeholders and community members directly. • In March 2023, together with our employee volunteers •Mr. Pandit participated in our 2022-2023 stockholder | |||||||||
Director continuing education | ||||||||
| We encourage our board members to participate in director continuing education (“DCE”): • We provide reimbursements for participation in DCE courses | |||||||
• We maintain a subscription for our directors with the National Association of Corporate Directors (“NACD”) and our directors actively take part in NACD offerings. For example, Ms. Studenmund is on an NACD Southern California special committee that meets regularly to discuss compensation committee matters • We provide regular updates to our directors on corporate governance and ESG matters, executive compensation developments and trends, accounting standards changes, risk management matters and other legal and other topics of interest from a variety of internal and external sources. Our directors are active DCE participants: For example, in 2022, Ms. Pipes: • attended the annual KPMG Board Leadership Conference, • participated in over 50 hours of courses and trainings on cybersecurity and ESG, among other topics, and • received an NACD Cybersecurity certification following her participation in the NACD’s course on Cybersecurity led by Carnegie Mellon University. Certain of our directors are also involved in industry-level governance matters. For example: • Mr. Mittal is the former president and chairman of the National Association of Software and Service Companies (“NASSCOM”), an Indian trade association and governance group focused on the information technology and business process outsourcing industry, in which we, and many of our U.S. peer companies with operations in India, are members. He advises NASSCOM on best practices for corporate governance and is currently assisting NASSCOM in the development of data privacy legislation in India. | ||||||||
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Anne Minto Independent director | Kristy Pipes Independent director | Rohit Kapoor Vice Chairman and CEO | Vikram Pandit Independent Chairman | Som Mittal Independent director | Jaynie Studenmund Independent director |
| 32 | / | EXL 2023 Proxy Statement |
Corporate governance
Board leadership structure
Vikram Pandit Independent Chairman |
Rohit Kapoor Vice Chairman | Our board of directors is currently led by Vikram Pandit, our Chairman, and Rohit Kapoor, our Vice Chairman and CEO. Our Fifth Amended and Restated By-laws (our “By-laws”) provide that our Chairman or, in the absence of our Chairman, our Lead Director (if there is a Lead Director serving at such time), or in the absence of both our Chairman and Lead Director, our CEO, calls meetings of our board of directors to order and acts as the chair for those board meetings. In the absence of our Chairman, our Lead Director (if there is a Lead Director serving at such time), and our CEO, a majority of our directors present may elect as chair of the meeting any director present. Independent directors meet at least quarterly in executive session without any management | ||
| directors or members of the Company’s management present. Our Corporate Governance Guidelines provide that in the absence of our Chairman, our Lead Director (if there is a Lead Director serving at such time) or, in the absence of the Lead Director, a director chosen by the directors meeting in executive session, presides at all executive sessions. | ||||
Our by-laws provide that our Chairman or, in the absence of our Chairman, our Lead Director (if there is a Lead Director serving at such time), or in the absence of both our Chairman and Lead Director, our CEO, shall call meetings of our board of directors to order and shall act as the chairman thereof. In the absence of our Chairman, our Lead Director (if there is a Lead Director serving at such time), and our CEO, a majority of our directors present may elect as chairman of the meeting any director present. Independent directors meet at least quarterly in executive session without any management directors or members of the Company’s management present. The Lead Director or, in the absence of the Lead Director, a director chosen by the directors meeting in executive session, presides at all executive sessions.
Consolidating the Vice Chairman and CEO positions allows our CEO to contribute his experience and perspective regarding management and leadership of the Company towards the goals of improved corporate governance and greater management accountability. In addition, the presence of our Chairman ensures that the board can retain sufficient delineation of responsibilities, such that our Chairman and our Vice Chairman and CEO may each successfully and effectively perform and discharge their respective duties and, as a corollary, enhance our prospects for success. As a result, the Company will benefit from the ability to integrate the collective leadership and corporate governance experience of our Chairman and our Vice Chairman and CEO, while retaining the ability to facilitate the functioning of the board of directors independently of our management and to focus on our commitment to corporate governance.
For the foregoing reasons, our board of directors has determined that its leadership structure is appropriate and in the best interests of our stockholders at this time.
| EXL 2023 Proxy Statement | / | 33 |
Majority Voting in Director Elections
Corporate governance
Under our by-laws,Director qualifications, refreshment and evaluations
Director qualifications
Key skills and attributes we look for in board nominees
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The board of directors who are standingconsiders it paramount to achieving excellence in corporate governance to assemble a board of directors that, taken together, has the breadth of skills, qualifications, experience and attributes appropriate for election in an uncontested election are elected by the affirmative vote of a majority of votes cast (meaning the number of shares voted “for” a nominee must exceed the number of shares voted “against” such nominee) in person or represented by proxy and entitled to vote at the meeting. If any incumbent nominee for director in an uncontested election receives a greater number of votes “against” his or her election than votes “for” such election, our by-laws provide that such person shall tender tofunctioning as the board of directors his or her resignation asof our Company and working productively with management. The Nominating and Governance Committee of the board is responsible for recommending nominees who are qualified and bring a director. (In contested elections,diverse set of skills and qualifications to oversee the Company effectively.
The Nominating and Governance Committee has not formally established any
minimum qualifications for director candidates, but pursuant to our Corporate
Governance Guidelines, our board of directors will be electedseeks members from diverse
professional and personal backgrounds who combine a broad spectrum of experience
and expertise with a reputation for integrity. The Nominating and Governance
Committee assesses each director candidate’s independence, diversity (including age,
ethnicity, race and gender, among others), skills and experience in the context of the needs of the board of directors. The Nominating
and Governance Committee considers a number of factors in selecting director candidates, including, among others: ethical standards
and integrity; independence; diversity of professional and personal backgrounds; skills and experience; other public company
directorships; and financial literacy and expertise; communication skills; and ability and willingness to comply with Company policies
and procedures.
In light of our business, the primary areas of experience, qualifications and attributes typically sought and put forward by the affirmative voteNominating and Governance Committee in director candidates include, but are not limited to, the following:
| Executive leadership Experience holding significant leadership positions, including as a CEO or head of a significant business, to help us drive business strategy, growth and performance. | |||
| Finance and accounting Experience with finance, accounting or financial reporting processes, to help drive financial performance. | |||
| Global companies Experience working outside of the United States or with multinational companies, to help facilitate our global expansion. |
| 34 | / | EXL 2023 Proxy Statement |
Corporate governance
| Board experience Understanding of public company board of director and fiduciary duties, to help provide perspective on corporate governance best practices and related matters. | |||
| Digital operations and solutions Experience with digital operations and solutions, artificial intelligence and machine learning, and other key technologies that are central to our business. | |||
| Client and industry knowledge Experience with our key client industries, including insurance, healthcare, banking and financial services, finance/accounting, and our other capabilities, to help deepen our knowledge of our key industry verticals and markets in which we do business. | |||
| Risk oversight/management Experience assessing and overseeing the overall risk profile of multinational public companies. | |||
| Human capital management Experience in management and development of human capital, including management of a large workforce, diversity and inclusion, talent development, workplace health and safety, compensation and other human capital issues. | |||
| Diverse backgrounds We seek directors with diverse professional and personal backgrounds and perspectives to promote the values of diversity and inclusion from the top and to provide perspective from varying viewpoints. | |||
| Experience in ESG matters Experience in managing ESG matters, incorporating them into business and strategy and associated risks. | |||
| Information and cybersecurity Experience in information and cybersecurity matters, best practices and associated risks. | |||
| Mergers and acquisitions Experience in mergers and acquisitions as a component of business development and strategy. | |||
 | Marketing Experience in marketing and branding of multinational companies. |
| EXL 2023 Proxy Statement | / | 35 |
Corporate governance
Refreshment
Our Nominating and Governance Committee regularly considers the size and composition of our board (and its committees) on a continual basis with an aim toward creating a balanced board with extensive experience and institutional knowledge, and fresh perspective and insight. Considerations include whether the composition of the board of directors (and its committees) includes sufficient diversity and independent skill sets and background as appropriate for our immediate and long-term strategic needs. These considerations are also informed by discussions with our investors through stockholder engagement. In terms of diversity, our board, following the Annual Meeting will be 29% diverse in terms of gender and 57% diverse in terms of ethnic/racial diversity. In considering board composition, our Nominating and Governance Committee also considers the length of tenure of the directors as a whole. Following the Annual Meeting (assuming the election of all nominees), we will have the following balance of tenures: | Board refreshment | |||||
ADDITIONS | EXITS | |||||
2023 Andreas Fibig |
2022 Garen Staglin | |||||
2023 Anne Minto Clyde Ostler | ||||||
While the Company does not maintain term limits, our Corporate Governance Guidelines provide that the expectations for new directors is a maximum term of a pluralityten years. Each of votes cast in person or represented by proxyour director nominees, other than our Vice Chairman and entitled to voteCEO, has served on the board for less than ten years as of the date of this Proxy Statement. The board actively manages board refreshment and succession planning at the Annual Meeting.) An uncontested election meansboard and committee level. For example, the board generally expects that each member serve on two committees, and that each committee chair serve for a maximum of five years. The board expects that over the next few years, the committee and board composition will continue to change due to rotation and retirement. The Nominating and Governance Committee will identify successors based on the goal of maintaining the board’s overall balance of experience and perspective. A recommendation regarding board (and committee) composition is shared with the full board of directors on an election in which the number of nominees for director is not greater than the number to be elected.annual basis.
| 36 | / | EXL 2023 Proxy Statement |
CommitteesCorporate governance
Board refreshment process
| EXL 2023 Proxy Statement | / | 37 |
Corporate governance
Committee rotation
We rotate committee and committee chair assignments based on the current composition of the board. Recent rotations include the following:
* Former director
Board evaluations
We consider the continued effectiveness of the board and its committees as critical to our long-term success and stockholder value. The board evaluates its performance and the performance of it committees and each director on an annual basis through the following process:
| 38 | / | EXL 2023 Proxy Statement |
Corporate governance
Succession planning
Our board of directors is responsible for developing and annually reassessing succession plans for our CEO and other key executive officers of the Company, and preparing contingency plans for interim CEO succession in the event of an unexpected occurrence for board review. We actively plan for the succession of our executive officers (including those who are retiring or departing from the Company), and regularly consider our strong pipeline of internal and external candidates.
Committees
Our board of directors currently has three standing committees: the Audit Committee, the Compensation and Talent Management Committee and the Nominating and Governance Committee. As discussed above, our board of directors has determined that each member of the Audit, Compensation and Talent Management and Nominating and Governance Committees meets the independence and experience requirements of the Nasdaq Stock Market and federal securities laws. Copies of our committee charters can be found on the Investor Relations page of our website at: https://ir.exlservice.com/corporate-governance. Information on our website referred to in this Proxy Statement does not constitute a part of this Proxy Statement.
The following table sets forth the current chairs and members of each standing committee of the board of directors. As an executive director, Mr. Kapoor does not serve on any board committee.
Audit | Compensation and | Nominating and | ||||
Kristy Pipes* |  |  | ||||
Andreas Fibig | | | ||||
Clyde Ostler** | | | ||||
Nitin Sahney* | | | ||||
Jaynie Studenmund* | | | ||||
Vikram Pandit (Chairman) | | | ||||
Anne Minto* | | | ||||
Som Mittal | | | ||||
| Chair | | Member |
*Not standing for re-election
*Audit Committee and the Compensation Committee.Financial Expert
| EXL 2023 Proxy Statement | / | 39 |
Corporate governance
Audit Committee.
Committee
Our Audit Committee oversees and assists our board of directors in fulfilling its oversight responsibilities with respect to our accounting and financial reporting processes, including the integrity of the financial statements and other financial information provided by us to our stockholders, the public, stock exchanges and others; our compliance with legal and regulatory requirements; our independent registered public accounting firm’s qualifications and independence; the audit of our financial statements; the performance of our internal audit function and independent registered public accounting firm; and the Company’s cyber securitycybersecurity program and cyber strategy-related risks.risks; business continuity and disaster recovery planning; and ESG-related disclosure, processes and controls. Our Audit Committee’s risk oversight is discussed below beginning on page 43. Our Audit Committee charter permits the committee to form and delegate authority to subcommittees when appropriate, provided that the subcommittees are composed entirely of directors who satisfy the applicable requirement of federal securities laws as well as independence requirements of the Nasdaq Stock Market.
Our Audit Committee has direct responsibility for the appointment, compensation, retention (including termination) and oversight of our independent registered public accounting firm, and our independent registered public accounting firm reports directly to our Audit Committee. Our Audit Committee also reviews and approves specified related-party transactions as required by the rules of the Nasdaq Stock Market, and oversees the Company’s cyber securitycybersecurity program and cyber strategy-related risks. The Audit Committee was established in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934 (the “Exchange Act”).Our Audit Committee annually reviews and assesses the adequacy of the Audit Committee charter and its own performance. A copy of our Audit Committee charter can be found on our website at www.exlservice.com. Information on our website referred to in this proxy statement does not constitute a part of this proxy statement.
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The members of our Audit Committee are appointed by our board of directors. All members of our Audit Committee must also be recommended by our Nominating and Governance Committee.
Audit Committee profile | ||
Kristy Pipes, Chair* Andreas Fibig Clyde Ostler* Nitin Sahney* Jaynie Studenmund* |
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• Accounting and financial reporting processes • Our independent registered public accounting firm’s appointment and independence • The audit of our financial statements and internal audit function • Other key areas including cybersecurity, ESG disclosures, processes and controls, litigation, business continuity and disaster recovery, compliance and regulatory enforcement matters | ||
*Audit committee financial expert under applicable SEC rules and regulations | ||
7 committee meetings in 2022 | ||
| 40 | / | EXL 2023 Proxy Statement |
Corporate governance
Compensation and Talent Management Committee
Our Compensation and Talent Management Committee reviews and recommends policies relating to compensation and benefits of our directors, officers and employees and is responsible for approving the compensation of our Vice Chairman and CEO and other executive officers, as well as our employee benefit policies, programs and administration. Our Compensation and Talent Management Committee reviews, evaluates and makes recommendations to our board of directors has determinedwith respect to our incentive compensation plans and equity-based plans and administers the issuance of awards under our equity incentive plans. Our Compensation and Talent Management Committee also provides oversight with respect to human capital management matters, including diversity, equity and inclusion, and talent and leadership engagement, development, and training and, in 2022, changed its name from Compensation Committee to Compensation and Talent Management Committee to reflect these responsibilities. Our Compensation and Talent Management Committee charter permits the committee to form and delegate authority to subcommittees when appropriate, provided that allthe subcommittees are composed entirely of directors who satisfy the members of the Audit Committee meet theapplicable independence and experience requirements of the Nasdaq Stock MarketMarket.
Our Compensation and Talent Management Committee charter also permits the federal securities lawscommittee to retain advisors, consultants or other professionals to assist the Compensation and Talent Management Committee to evaluate director, Vice Chairman and CEO or other senior executive compensation and to carry out its duties. For 2022, our Compensation and Talent Management Committee retained the services of Farient Advisors LLC (“Farient”), a qualified and independent compensation consultant, to aid the Compensation and Talent Management Committee in performing its review of executive compensation including executive compensation benchmarking and peer group analysis. Our Compensation and Talent Management Committee annually reviews and assesses the adequacy of the Compensation and Talent Management Committee charter and its own performance. Additional information regarding our Compensation and Talent Management Committee’s processes and procedures for audit committee membership.considering executive compensation are addressed in the Compensation Discussion and Analysis below.
Compensation and Talent Management Committee profile | ||
Jaynie Studenmund, Chair Anne Minto Som Mittal Clyde Ostler Vikram Pandit Kristy Pipes |
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• Overall compensation risk management, including recommending incentive compensation plans • Retention of advisors or other compensation consultants • Oversight of human capital management matters, including diversity, equity and inclusion • No interlocks or insider participation | ||
5 committee meetings in 2022 | ||
The members of our Compensation and Talent Management Committee are appointed by our board of directors. All new members of our Compensation and Talent Management Committee must be recommended by our Nominating and Governance Committee.
During 2022, none of our executive officers served as a member of the board of directors or Compensation and Talent Management Committee of (or similar) any entity that has one or more executive officers who serve on our board of directors or Compensation and Talent Management Committee.
| EXL 2023 Proxy Statement | / | 41 |
Corporate governance
Nominating and Governance Committee
Our Nominating and Governance Committee is responsible for: (i) identifying and recommending candidates for election to our board of directors using selection criteria approved by our board of directors, reviewing composition of the board and committee membership and overseeing board refreshment and director compensation and benefits matters, (ii) developing and recommending to our board of directors Corporate Governance Guidelines, that are applicableincluding independence standards, and other board procedures or corporate governance policies, as well as any changes to us, andsuch guidelines, procedures or policies or to any of our organizational documents; (iii) overseeing our board of director and management evaluations. A copy ofevaluations and our director education program, and (iv) overseeing our ESG goals, policies and practices. Our Nominating and Governance Committee charter can be found on our website at www.exlservice.com.
Our Nominatingpermits the committee to form and Governance Committee has a policy, reflected in such committee’s charter,delegate authority to subcommittees when appropriate, provided that the subcommittees are composed entirely of considering director candidates recommended by our stockholders. Candidate recommendations should be sent to our Nominating and Governance Committee, c/o ExlService Holdings, Inc., 320 Park Avenue, 29th Floor, New York, New York 10022, Attention: Corporate Secretary. Our Nominating and Governance Committee evaluates all candidates indirectors who satisfy the same manner regardlessapplicable independence requirements of the source of the recommendation. Our Nominating and Governance Committee, in making its selection of director candidates, considers the appropriate skills and personal characteristics required in the light of the then-current makeup of our board of directors and in the context of our perceived needs at the time. The Nominating and Governance Committee considers a number of factors in selecting director candidates, including, among others, ethical standards and integrity; independence; diversity of professional and personal backgrounds; skills and experience; other public company directorships; and financial literacy and expertise; communication skills; and ability and willingness to comply with Company policies and procedures.Nasdaq Stock Market.
Nominating and Governance Committee profile | ||
Nitin Sahney, Chair Andreas Fibig Anne Minto Som Mittal Vikram Pandit |
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• Reviewing composition of the board, overseeing board refreshment and identifying and recommending board candidates • Developing and recommending governance practices, including our Corporate Governance Guidelines • Overseeing board evaluations • Overseeing our ESG goals, policies and practices | ||
5 committee meetings in 2022 | ||
Our Nominating and Governance Committee reviews written and oral information provided by and about candidates and considers any additional criteria it feels is appropriate to ensure that all director nominees possess appropriate skills and experience to serve as a member of our board of directors.
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Although our Nominating and Governance Committee does not have a formal policy with regard to diversity of board members, pursuant to our Corporate Governance Guidelines, our board of directors seeks members from diverse professional and personal backgrounds who combine a broad spectrum of experience and expertise with a reputation for integrity. This assessment includes an individual’s independence, as well as consideration of diversity, age, skills and experience in the context of the needs of the board of directors. Our Nominating and Governance Committee reviews and makes recommendations regarding the composition of our board of directors in order to ensure that the board has an appropriate breadth of expertise and its membership consists of persons with sufficiently diverse and independent skill sets and backgrounds. The Nominating and Governance Committee also oversees our director onboarding and training program, which provides new directors with training regarding the Company’s policies and procedures and specific requirements that may be needed based on the director’s committee memberships.
In addition, the Nominating and Governance Committee oversees and reviews the Company’s ESG goals, policies and programs and the Company’s corporate governance policies and practices regularly. Our Nominating and Governance Committee is responsible for reviewing and assessing the adequacy of our organizational documents, and recommending any changes, as well as annually reviewsreviewing and assessesassessing the adequacy of the Nominating and Governance Committee charter and its own performance.
The members of our Nominating and Governance Committee are appointed by our board of directors. Our board of directors has determined that all of the members of the Nominating and Governance Committee meet the independence requirements of the Nasdaq Stock Market and federal securities laws.
| 42 | / | EXL 2023 Proxy Statement |
Compensation Committee.
Our Compensation Committee reviews and recommends policies relating to compensation and benefits of our directors, officers and employees and is responsible for approving the compensation of our Vice Chairman and CEO and other executive officers. Our Compensation Committee also reviews, evaluates and makes recommendations to our board of directors with respect to our incentive compensation plans and equity-based plans and administers the issuance of awards under our equity incentive plans. Our Compensation Committee charter permits the committee to form and delegate authority to subcommittees when appropriate, provided that the subcommittees are composed entirely of directors who satisfy the applicable independence requirements of the Nasdaq Stock Market. Any such subcommittee must have a published committee charter.Corporate governance
Our Compensation Committee charter also permits theBoard and committee to retain advisors, consultants or other professionals to assist the Compensation Committee to evaluate director, Vice Chairman and CEO or other senior executive compensation and to carry out its duties. For 2018, our Compensation Committee retained the servicesoversight of Frederick W. Cook & Co., Inc. (“FW Cook”), a qualified and independent compensation consultant, to aid the Compensation Committee in performing its review of executive compensation including executive compensation benchmarking and peer group analysis. Our Compensation Committee annually reviews and assesses the adequacy of the Compensation Committee charter and its own performance. Additional information regarding our Compensation Committee’s processes and procedures for considering executive compensation are addressed in the Compensation Discussion and Analysis below. A copy of our Compensation Committee charter can be found on our website at www.exlservice.com.risk management
| Full board oversight | ||||||||
| Our board of directors is ultimately responsible for overseeing EXL’s risk management activities as a whole. | ||||||||
Our management is responsible for development of our risk management framework and methodological guidelines. Management is responsible for our day-to-day risks, and, because we are exposed to financial risks in multiple areas of our business, day-to-day risk management activities and processes are performed by multiple members of our senior and other management. | Our management assists the board in identifying strategic and operating risks that could affect the achievement of our business goals and objectives, assessing the likelihood and potential impact of these risks and proposing courses of action to mitigate and/or respond to these risks. | |||||||
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Audit Committee Responsible for primary oversight of our risk management, financial and cybersecurity risk and reporting internal and external audit controls and regulatory requirements. Reviews and discusses with management our enterprise risk assessment, major financial risk and cybersecurity exposures and the steps management has taken to monitor, control and manage such exposures, including our risk management guidelines and policies. Reviews and discusses with other board committees our environmental, social and governance programs and related matters. |
| Nominating and Governance Responsible for risk relating to environmental, social and governance matters, conflicts of interest, and oversight of corporate governance policies and practices as a risk- steps management-related measure. | Compensation and Talent Responsible for executive and employee compensation and retention-related risk, as well as other human capital management-related risk. |
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| EXL 2023 Proxy Statement | / | 43 |
The members of our Compensation Committee are appointed by our board of directors. All new members of our Compensation Committee must be recommended by our Nominating and Governance Committee. Our board of directors has determined that all members of the Compensation Committee meet the independence requirements of the Nasdaq Stock Market and federal securities laws for compensation committee membership.Corporate governance
Risk OversightCybersecurity risk management
Our board of directors provides risk oversight. Our management assistsGiven the board in identifying strategic and operating risks that could affect the achievementnature of our business, goalsEXL is highly focused on maintaining a robust and objectives, assessing the likelihoodcomprehensive program that identifies and potential impactmanages a broad range of thesecybersecurity and data privacy, referred to collectively herein as “cybersecurity,” risks and proposing courses of action to mitigate and/or respond to these risks. These risks are reviewed and discussed periodically with the full board of directors as part of the business and operating review.
Our management is responsible for managementon behalf of our day-to-day risks,clients and because we are exposed to financial risks in multiple areastheir customers, as well as our employees, contractors and any relevant third parties. Cybersecurity is managed by our cross-functional cybersecurity apex body, the Management Security, Continuity and Privacy Forum, which is comprised of representatives from our management, business day-to-day risk management activitiesunit heads, and processes are performed by multiple members of our seniortechnology and other management.information security leadership teams. Our board of directors primarily relies on the Audit Committee forhas primary oversight of our risk management and cyber security risk. The Audit Committee regularly reviewsreceives regular briefings throughout the year on all identified and discusses with management our major financial riskpossible cybersecurity-related risks, vulnerabilities and cyber security exposuresstrategic policies and the steps management has taken to monitor, control and manage such exposures, including our risk assessment and risk management guidelines and policies. In addition, our management maintains, as part of our disclosure controls and procedures, a separate disclosure committee that, as part of its review of our quarterly and annual reports, helps facilitate understanding by the Audit Committee and our full board of directors of new or changing risks affecting us. Oncepractices frommanagement. At least once a year, the fullour board receives a report from management on the Company’s readiness and capability to prevent,reduce the risk of, detect and respond to a cyber-attack.
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Our cybersecurity team consists of privacy attorneys, qualified technical cybersecurity professionals and business continuity specialists. We also periodically engage third-party experts to review and assess our cybersecurity governance and management. In addition, we maintain Risk Appetite Guidelines that describe certain categories2022, our Board and management completed cybersecurity tabletop exercises to further our preparedness in the event of risk and qualitative and quantitative thresholds considered by the Companya need to be consistent with its strategic objectives. These guidelines are designed to serve asaddress a reference in assessing and implementing strategy, and to be actionable by management such that they are meaningful from an operational perspective.variety of cybersecurity threat scenarios.
Compensation Committee Interlocks and Insider Participation
For more details on our cybersecurity program, see “Sustainability – Cybersecurity at EXL” on page 54.
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Ms. Kerr, Ms. Minto, Mr. Mittal, Mr. Ostler, Mr. Staglin and Ms. Studenmund are the members of our Compensation Committee.Corporate governance
During 2018, none of our executive officers served as a member of the board of directors or compensation committee of any entity that has one or more executive officers who serve on our board of directors or Compensation Committee.
Other Directorships
The Board maintains a practice whereby our directors disclose to the Board any offers to be a director of any other organization, which is then evaluated by the Board for potential businessEnvironmental, social and other conflicts.
Code of Conduct and Ethics; Corporate Governance Guidelines
governance (“ESG”) risk management
Our board reviews and receives regular reports on ESG and sustainability risks, including those relating to ESG disclosures, employee safety, environmental-related efforts, human capital management matters, and corporate governance trends and best practices. In 2022, we continued to implement further controls, processes and frameworks for the collection and disclosure of directors has adoptedESG-related data. We also receive third-party limited assurance of certain indicators contained within our Sustainability Report from a Code of Conduct and Ethics that is applicable to our directors, officers and employees and which outlines the high ethical standards that we support and details how our directors, officers and employees should conduct themselves when dealing with fellow employees, clients, suppliers, competitors and the general public. Our Code of Conduct and Ethics is reviewed annually by the Audit Committee. A copyBig 4 accounting firm affiliate.
Each of our Codeboard Committees is involved in oversight over ESG-related risks as relate to matters within their purview as follows:
The full board is regularly briefed on the matters overseen by each Committee.
We maintain a management-level ESG steering committee, which is responsible for setting our sustainability/ESG strategy and risk management, keeping our management and board up-to-date on ESG-related developments, overseeing our internal and external disclosure on ESG matters, and providing implementation support across our Company. The ESG steering committee works in close coordination with the board, and provides the board with advice and assistance in its oversight of ConductESG risks and Ethics can be foundother matters. For more details on our ESG and sustainability-related efforts, see “Sustainability” on page 48.
| EXL 2023 Proxy Statement | / | 45 |
Corporate governance
Stockholder engagement In 2022 and continuing into early 2023, we continued our formal governance-focused stockholder outreach program. The scope of our outreach and engagement is shown in the graphic to the right of this paragraph. Given our frequent engagement and the maturity of our stockholder outreach program, a number of our stockholders that we engaged with in prior years elected to defer meeting to a future year. EXL was represented by our management and members of our legal and investor relations teams at these meetings, and one meeting was led by Mr. Pandit, our Independent Board Chairman. We discussed the following topics: | Stockholder Engagement 2022-23
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EXL also regularly interacts and shares information with our stockholders through our quarterly earnings calls, investor meetings, SEC filings and publications on our website, at www.exlservice.com.among others. The feedback received from our stockholders is shared with and reviewed by our board, which is used to inform and focus our decisions relating to our governance and sustainability practices and to improve our disclosure.
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Our board of directors has also adopted a set of Corporate Governance Guidelines to assist our board of directors in the exercise of its responsibilities. The Corporate Governance Guidelines reflect the commitment of our board of directors to monitor the effectiveness of policy and decision-making, both at the board and senior management levels, and to enhance stockholder value over the long term. A copy of our Corporate Governance Guidelines can be found on our website at www.exlservice.com.governance
Communications with the Board
board
Stockholders interested in contacting our board of directors, our Chairman or any individual director are invited to do so by writing to:
Board of Directors of ExlService Holdings, Inc.
c/o Corporate Secretary
ExlService Holdings, Inc.
320 Park Avenue, 29th Floor
New York, New York 10022
All other stockholder communications addressed to our board of directors will be referred to our Chairman and tracked by our Corporate Secretary. Stockholder communications specifically addressed to a particular director will be referred to that director.
Complaints and concerns relating to our accounting, internal accounting controls or auditing matters should be communicated to our Audit Committee, which consists solely of non-employee directors. Any such communication may be anonymous and may be reported to our Audit Committee through our General Counsel by writing to:
Audit Committee of the Board of Directors
ExlService Holdings, Inc.
320 Park Avenue, 29th Floor
New York, New York 10022
Attn: General Counsel
All such concerns will be reviewed under Audit Committee direction and oversight by our General Counsel, our Head of Internal Audit or such other persons as our Audit Committee determines to be appropriate. Confidentiality will be maintained to the fullest extent possible, consistent with the need to conduct an adequate review. Prompt and appropriate corrective action will be taken when and as warranted in the judgment of our Audit Committee. We prepare periodic summary reports of all such communications for our Audit Committee.
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Section 16(a) Beneficial Ownership Reporting ComplianceSustainability
Section 16(a)Sustainability
In line with our mission of looking deeper to find a better way for our clients, at EXL we are committed to doing our part as a global citizen to build a better future by operating in a responsible and sustainable manner. We believe that by integrating sustainable practices into our business model, working towards positive social change, and providing transparent reporting on those practices and our progress, we are a stronger and more resilient organization, best able to deliver long-term value to our stockholders while promoting and developing our business, people, communities and the Exchange Act requiresworld around us. We refer to these activities as “sustainability” and “environmental, social and governance” or “ESG” throughout this Proxy Statement.
Recent activities
In 2022 and continuing into 2023, we took a number of steps to continue improving our executive officers and directors, and persons who own more than 10% of a registered class of our equity securities, to file reports of ownership on Forms 3, 4 and 5 with the SEC. Officers and directors are required to furnish us with copies of all Forms 3, 4 and 5 they file. Based solely on a review of the reports furnished to us, or written representations from reporting persons that all reportable transaction were reported, the Company’s officers, directors and greater than ten percent owners timely filed all reports they were required to file under Section 16(a) with respect to transactions during fiscal year 2018, except for the following Form 4s that were filed subsequent to the due date on account of administrative error: one report (one transaction) for each of Messrs. Staglin, Kapoor, Bagai, Bhalla, Chhibbar, Miglani and Srivatsan and one report (one transaction) for each of Mr. Rembert de Villa and Ms. Nancy Saltzman, each a former officer of the Company.
OUR EXECUTIVE OFFICERSsustainability program. These recent activities include:
| 1
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| Formally allocating oversight responsibilities to our board committees over ESG-related matters in late 2021 and early 2022, which are described on pages 40-42SA of this Proxy Statement, and, in 2022, adopting the name Compensation and Talent Management Committee, to reflect the committee’s oversight over human capital management matters | |||||||
| 2 | Taking new actions in environmental stewardship, including: • transitioning certain of our delivery centers in India and the UK to 100% green energy and installing rooftop solar facilities in three of our delivery centers in India, among other green actions • achieving ISO 14001:2015 certification in all of our locations worldwide, meeting international standards for effective environmental management systems | |||||||||
| 3 | Demonstrating our commitment to providing transparency and meaningful disclosure on ESG-related information, including through: • continuing to update our Sustainability page on our website, which highlights all of our relevant sustainability-related policies, reports, certifications and awards, targets and activities, available at www.exlservice.com/about/sustainability • publishing our third Annual Sustainability Report developed in accordance with the Global Reporting Initiative (GRI) Standards: Core Option and aligned to the Sustainability Accounting Standards Board (SASB) Software and IT Services Standard (2018), available on the Sustainability page of our website with assurance from a Big 4 accounting firm affiliate • developing and adopting further controls, processes and frameworks around ESG data collection and reporting • launching a Company-wide internal ESG amplification campaign aimed at driving employee support and participation in our ESG efforts | |||||||||
| 4 | Launching a new Company-wide community engagement focus in 2022 that aims to bring science and technology skills, with a particular emphasis on coding, to women, girls and non-binary people in the communities in which we operate, in partnership with various non-profit organizations in India, the Philippines, South Africa, the United Kingdom and the United States, in addition to our existing education and skill building initiatives | |||||||||
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Sustainability
Community Engagement
EXL is focused on assisting the members of the communities in which we live and work to develop market-relevant skills. We provide programming on skills development for adults and children within our communities: | ||||||||||||||||
Skills to Win Initiative | Education as a Foundation Initiative | |||||||||||||||
Skills to Win focuses on equipping people in our communities with the skills that the market demands. We provide training on employability skills for back-office roles, finance and accounting, and data and analytics and digital capabilities, all coupled with life and workplace skills. By virtue of our online delivery of a portion of our programming, were able to scale the Skills to Win Initiative, reaching more than three times as many beneficiaries in 2022 than we reached in the prior year. Skills to Win is opening new doors for employment and earnings for participants in the United States, the Philippines, India, United Kingdom and South Africa. Over the past five years, we have continued to evolve this initiative to reflect new and emerging skills and strengthen the portfolio of courses offered. In 2022, we created a new focus area for our Skills to Win Initiative to target bringing STEM skills- and in particular, coding skills- to girls, women and non-binary people in our communities in India, the Philippines, South Africa, the United Kingdom and the United States through partnerships with organizations and institutions in each of those locations. | Education as a Foundation provides school-aged children with a foundation in data and analytics skills, as well as extracurricular activities such as art, music, fitness, and languages, all of which will enable them to position themselves as future leaders. We use a blend of online and offline learning platforms, and have expanded the role of our students’ parents as co-educators, and added a new focus in our content on the physical and mental wellbeing of our students and their families. Like our Skills to Win Initiative, in 2022, we were able to continue to scale this program, in part as a result of our use of a hybrid in-classroom and virtual format, to reach more than four times as many students than we had in the prior year. | |||||||||||||||
In 2022, we brought this program to more than 3,400 people in our communities across the globe. | In 2022, we brought this program to more than 11,000 students worldwide. | |||||||||||||||
Our employees are an integral part of our community strategy, sharing their skills and experience working on advanced digital technologies through volunteering. We also support our employees’ charitable efforts by enabling payroll giving with company matching and recognizing social impact through individual, geography and business unit awards. Our use of virtual volunteering has made participation in our community engagement programming even easier for our employees, and has enabled us to reach more people through our programming.
We are also involved in fundraising initiatives. In 2022, we hosted an employee fundraiser and also routed a portion of our community engagement funding toward supporting the humanitarian aid and relief efforts in Ukraine. In 2023, we hosted an employee fundraiser to provide meals to individuals affected by the February 2023 earthquake in Turkey and Syria.
We regularly seek to increase engagement across our organization in our community initiatives. We hold an annual awards ceremony to recognize our employee volunteers for their contributions. In early 2023, we hosted geography-specific trainings for certain of our employees who we appointed to be our local “CSR champions.” Our CSR champions will assist us in driving interest and participation across our employee base in our community engagement programming.
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Sustainability
Protecting our planet At EXL, we prioritize environmental stewardship and endeavor to minimize the environmental impact of our operations. We focus on conserving energy, minimizing waste, reducing water and one-time plastics use and developing efficient infrastructure and operations, all in order to reduce our environmental footprint across our global operations. We provide information relating to greenhouse gas emissions and climate impact in our Sustainability Report. We have participated in the CDP’s Climate Change disclosure program since 2018 and are working to reduce our emissions. Given that our energy consumption is primarily from our office facilities, we have taken measures to improve energy efficiency including, for example, an enterprise-level retrofit program to transform existing delivery centers into highly efficient buildings with smart automation, using technology such as modular power supplies to conserve energy and optimizing our use of real estate. We adopted a hybrid in-person and remote work operating model, which will help us to reduce greenhouse gas emissions by decreasing commuting- related travel. For more information on efforts toward protecting our planet, please refer to our Sustainability Report, available on our website at www.exlservice.com/about/sustainability. We expect to report our 2022 progress toward these efforts in our 2022 Annual Sustainability Report to be published during 2023. Human rights and sustainable supply chain Human rights Our Human Rights Policy details our commitment to human rights and our zero tolerance policy with respect to workplace harassment and discrimination and preventing forced labor and trafficking and other abuses. Sustainable supply chain In order to ensure that our suppliers’ business conduct aligns with our expectations, we collect background information from our new suppliers on their policies and performance relating to economic and environmental matters, and human rights, data privacy, product safety and working conditions. We require our suppliers to adhere to our Supplier Standards of Conduct, which set out commitments relating to creating |  |
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Sustainability
a more sustainable and responsible world through addressing human rights, labor rights and environmental issues, and ask suppliers to attest to their compliance. We generally maintain the right to review our suppliers’ practices at onboarding and in the future.
We seek to procure our materials from local suppliers, to the extent feasible.
Our supplier diversity programs encourage the engagement of suppliers of diverse backgrounds, including, without limitation, suppliers owned by people belonging to minority groups, women, the LGBTQ+ community, and veterans, specially-abled people, and small business enterprises.
Supporting and developing our people
Our people are our primary assets. The world we work and live in is full of diversity and powered by innovation. We believe success in such a world will come through an environment that embraces diversity of thought and experience. In line with our core values, one of our principal priorities is promoting talent development, while creating an inclusive work environment that permits us to leverage our employees’ diversity to deliver exceptional results for our clients. We have an active employee relations function, which is overseen by our Compensation and Talent Management Committee, that regularly communicates with and seeks to understand our employees in order to swiftly respond to specific needs and concerns as they arise. We regularly conduct employee surveys to monitor our employee satisfaction and engagement, as further described below and employ people analytics in our talent management processes to optimize our delivery of our talent acquisition and development strategy. On an annual basis, our Compensation and Talent Management Committee previews, and then our full board reviews, a comprehensive human capital strategic review prepared by management.
Headquartered in New York, we are made up of over 45,400 professionals, with more than 50 offices spanning six continents.
EXL locations
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Sustainability
Diversity, equity and inclusion
Diversity, equity and inclusion (“DEI”) is a focus at EXL, as we believe that our employees’ diversity of thought and experience are key to our ability to innovate on a global scale, in line with our long-term corporate strategy. Our DEI program is led by our human resources leadership team, together with our Diversity and Inclusion Council, and is ultimately overseen by our board. Our Diversity and Inclusion Council consists of a global, diverse mix of leaders, provides inputs to the design of our diversity, equity and inclusion program to bring in diverse perspectives, collaborates with external partners for customization inputs, conducts periodic reviews of the progress of our program and provides execution leadership for specific initiatives. The following are select DEI statistics* as of December 31, 2022:
| 41% | 20% | 22% | 51% | 61% | ||||
| Gender Diversity Company-wide | Gender Diversity Company-wide Vice President and Up | Gender Diversity Senior Management | Racial and Ethnic Diversity U.S. Employees | Racial and Ethnic Diversity Senior Management | ||||
*Senior Management includes members of our Executive Committee and Operating Committee. U.S. Employees includes diversity data as self-reported by employees.
Our DEI program is designed around three pillars: capability development, communication and recruitment. Key features of our DEI program are as follows:
| We seek to improve diversity and inclusion through offering a blend of in-person workshops, virtual sessions, and e-learning programs. |
| We are committed to hiring a diverse workforce and to improving diversity in our senior leadership, and include diversity equity, and inclusion among the guiding principles in our talent acquisition, training and retention practices. | |
We expect to drive greater diversity within our workforce through a combination of promotion within our organization and external hiring, accounting for any attrition of existing employees. |
| Pay equity is an important tenet of our long-term strategy. We completed a pay equity study in 2021 through a third-party consultant to review pay variations among our employees, and identify whether any gaps exist that are attributable to factors that are contrary to our mission of Company-wide pay equity, including gender or racial/ethnic group. Our assessments did not reveal any systematic pay inequity. |
| We have several Company-wide initiatives aimed at promoting diversity, equity and inclusion and leadership opportunities for our diverse employees, including several initiatives that are focused specifically on supporting and developing women at EXL: | |
•Managing Unconscious Bias training, Company-wide employee training to bring awareness to and address unconscious bias in the workplace to create a more inclusive workplace; mandatory Anti-Harassment trainings for employees in India and the United States | ||
•Executive Women VP Development Program, a nine-month leadership development program offered to all of our women vice presidents in 2022 that includes virtual courses and workshops on executive leadership offered through Cornell University’s eCornell platform, coaching and mentoring for strategic leadership capability development and leadership conversations between participants and our executive and operating committee members on DEI issues | ||
•Employee Resource Groups, focus groups of select employee communities aimed at supporting diverse groups and interests within the Company | ||
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Sustainability
•Diversity and Inclusion Springboard – Make your Mark, a six-month certification program for women at the mid- to senior-level for personal and professional advancement that is offered annually | ||
•“Super Mom,” a program to improve retention and engagement of new mothers through employee-friendly parental leave policies, flexible / reduced working hours for pre- and post-maternity, reorientation after long leave, extended leave, nursing stations and employee care, among others | ||
•WE (Women at EXL), a platform with initiatives such as Employee Resource Groups, a mentoring program (WE NURTURE), inner circles, women back to work, web chat series and face-to-face talks | ||
• In 2022, we launched The Umbrella Project, a celebration of inclusion alongside our LGBTQ+ colleagues, communities and allies worldwide | ||
Talent recruitment, development and retention
Talent-first mindset | Integrated talent management framework | Active role for senior leadership | Continuous employee development | |||
| We view talent as a differentiator for our Company’s competitive advantage and, under the leadership of our board of directors and senior executives, are committed to a talent-first mindset. | We maintain an integrated talent management framework, employing active collaboration between our recruitment, capability development and human resource functions. | Our senior leadership team and board of directors play a critical role in defining our talent priorities to align with our strategic vision for each of our business units, as well as with our clients’ priorities. | We focus on continuously developing our employees through our rigorous promotion standards, client and industry-specific training and competitive compensation packages that include incentive-based compensation. | |||
We consider EXL to be a “learning” company, and promote a strong self-learning culture. We have institutionalized a comprehensive set of practices, processes and programs to create an active learning culture and to proactively build market-relevant talent within our Company in four stages:
| • | Prejoining: Assessments, development on online learning platforms |
| • | Onboarding: Company orientation, trainings and informal team meetings |
| • | Job readiness: Education on client processes, tools and technologies, communication effectiveness and cultural sensitivity |
| • | Ongoing development: Continued formal learning activities, on the job, supervisor feedback and coaching, regular talent reviews and talent inventory succession, leadership training to identify and develop new leaders |
Our capability development framework is focused on developing our employees’ digital and domain expertise and leadership as a means to develop our talent internally. We do this through our learning academies, and through partnerships with industry organizations, institutes, business schools and consulting firms. In 2021 and into 2022, we launched a new learning management system, reNew, that permits our employees to engage in self-directed learning by participating in collaborative trainings that are personalized to their interests and positions and are delivered virtually from any location, at any time. In 2022, we also launched a learning marketplace that provides employees with regularly updated best-in-class digital trainings and certifications.
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Sustainability
Academies
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Sustainability
2022 Training
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Sustainability
Employee engagement and communication
We consider communication and engagement with our more than 45,400 employees distributed throughout more than 50 offices worldwide to be important to our ability to promote our ONE EXL culture that prioritizes inclusivity and collaboration, especially following our adoption of a hybrid operating model with our employees working remotely and in-office. We continued to rely on, and improve, our digital communication and collaboration platforms and multi-channel approach to keeping our employees informed that we built out beginning in 2020 during the COVID-19 pandemic. In particular, we engage with our employees through:
Benefits
| Paid leave for new parents | |
| Excused days of absence | |
| Generous vacation policy | |
| Paid holidays | |
| Employee assistance program providing confidential counseling services | |
Our employees also participate in our success:
| Annual or monthly incentives: 100% of our employees are eligible to receive | |
| 401K plans with Company match: 100% of our U.S. employees are eligible to enroll within three months of their employment at EXL | |
| ESPP: Our employees in the U.S., the U.K. and India are invited to participate in our employee stock purchase plan, which was approved by our stockholders in our 2022 annual meeting | |
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Sustainability
Employee health, safety and wellbeing
Because our people are so important to us, we have always viewed employee health, safety and wellbeing as one of our top commitments. We periodically provide trainings on health and safety to our employees, suppliers and partners. In 2022, approximately 99% of our employees completed our health and safety training e-module. We also conduct a risk assessment every six months with the aim of minimizing risk in the workplace. We have received a number of recognitions and awards for our efforts in employee health and safety, detailed below under “Achievements, certifications and awards” on page 59. We also have a number of initiatives to promote our employees’ wellbeing:
Cybersecurity at EXL
We are committed to protecting the confidentiality, integrity, availability and privacy of the information assets of our clients and their customers, as well as our employees, vendors and any other third parties, that are shared with us and for which we are responsible and have developed robust information security and cybersecurity and data privacy controls, safeguards and enabling measures in accordance with applicable laws, regulations and information security standards.
We have implemented and maintain, and regularly improve upon, tools and capabilities to identify, protect, detect, respond and recover from cyber threats, incidents and attacks; reduce vulnerabilities; and minimize the impact from cyber incidents. We have
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Sustainability
an established culture of compliance around cybersecurity matters, and have a strong governance program built upon and supported by policies and processes, tools and technologies, and regular knowledge and awareness training. Each of our employees receives regular knowledge and awareness training on risk mitigation and management and controls and procedures relating to information security, cybersecurity and data privacy.
We comply with and/or are certified in the following standards:
ISO 27001:2013 Global Information Security Standard – Company-wide | PCI DSS 3.2.1 Credit Card and Payment Industry Certification – India, Philippines and South Africa operations | SOX 404 / SSAE 16, SOC 1 and SOC 2 – Company-wide | Hitrust Certification – healthcare operations | ISO 22301 Business Resiliency Certification – India, Philippines and South Africa operations |
For more information on our cybersecurity risk management, please see “Cybersecurity risk management” on page 44. For more information on our information security and data privacy procedures, please refer to our Sustainability Report, which is available on our website at www.exlservice.com/corporate-sustainability.
Responsible artificial intelligence
We seek to ensure that our use of artificial intelligence (“AI”) in our business and operations is ethical and trustworthy. We emphasize data integrity as key to eliminate bias in the application of AI. We have a global AI Governance Policy and framework, and a cross-functional AI Governance Committee that oversees and governs our use of AI, with the overall aim of vetting and minimizing potential unethical or unlawful biases in AI processes. Pursuant to our AI Governance Policy, for each deployment of AI, our business teams are guided by our AI bias principles and, in many cases, include a risk assessment exercise. Applicable employees also participate in trainings to identify and reduce bias in AI.
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Sustainability
Achievements, certifications and awards
Health and safety management system, and 75% of our delivery centers as of December 31, 2022, are certified to ISO 45001:2018, meeting international standards for occupational health and safety | ||||
All of our delivery centers worldwide are ISO 14001:2015 certified, meeting international standards for effective environmental management systems. |
Reporting pursuant to SASB Software | Participant United Nations Global Compact |
Participant in the CDP’s Climate Change disclosure program with respect to GHG emissions and climate change data |
 | | | ||||||||||
Safety Excellence Award for Women’s Safety 2021 and 2022, and for Fire Safety 2022 | 100 Most Sustainable Companies 2022 and 2023 | Safest Workplace Award 2021 and 2022 | ||||||||||
| International Institute of Safety & Security Management (IISM) Global Conclave | Barron’s | World Safety Forum | ||||||||||
| | | ||||||||||
| Environmental Stewardship | International Safety Award | Most Trusted Companies | ||||||||||
| Award 2022 | 2022 | 2022 and 2023 | ||||||||||
| World Safety Forum | British Safety Council | Newsweek | ||||||||||
| ||||||||||||
Gold Medal—2022 | ||||||||||||
EcoVadis | ||||||||||||
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Sustainability
Environmental, social and governance matters and pay-for-performance at EXL
A portion of our CEO’s total compensation is tied to the achievement of specific performance goals relating to ESG matters. For more information, see “Detailed review of compensation components – Annual incentives – Determination of individual performance measure achievement” on page 79.
Sustainability oversight
For more information on our oversight of sustainability and ESG-related matters and risks, see “Environmental, social and governance risk management” on page 45.
Learn more about sustainability and environmental, social and governance matters at EXL
Please visit www.exlservice.com/about/sustainability to learn more about our efforts toward sustainability and the impacts we are making on our communities and the environment. Information on our website referred to in this Proxy Statement does not constitute a part of this Proxy Statement.
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Our executive officers
Our executive officers
| Rohit Kapoor | (age 58) |Vice Chairman and CEO | See section entitled “Our | |
| Ajay Ayyappan | Mr. Ayyappan has served as our Executive Vice President, General Counsel and Corporate Secretary since February 2023. He previously served as our Senior Vice President, General Counsel and Corporate Secretary | ||
| Vikas Bhalla | (age 51) |Executive Vice President and Business Head, | Mr. Bhalla has served as our Executive Vice President and Business Head, | |
| Vivek Jetley (age 48) |Executive Vice President and | Business Head, Analytics Mr. | ||
| Narasimha Kini (age | 54) |Executive Vice President and | Business Head, Emerging Business Mr. | |
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Our executive officers
| Anita Mahon (age | 54) |Executive Vice President and | Ms. Mahon has served as our Executive Vice President and Business Head, Healthcare since May 2022, and previously served as our Executive Vice President and Chief Growth Officer (March 2020 to May 2022). Prior to joining us, Ms. Mahon served as Vice President, Data, Strategy & Portfolio Officer at IBM Watson Health, a business unit focused on developing cognitive and data-driven technologies to advance health. Ms. Mahon joined IBM in | |
| Maurizio Nicolelli (age 54) |Executive Vice President and Chief Financial Officer Mr. | |||
| Ankor Rai (age 47) |Executive Vice President and Chief Digital Officer Mr. Rai has served as our Executive Vice President and Chief Digital Officer from October 2021 until his resignation in April 2023. He previously served in several leadership roles with us, including as the global co-head of | |||
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EXECUTIVE COMPENSATIONExecutive compensation
Executive compensation
Compensation Discussion and Analysis
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Executive compensation
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Potential payments upon termination or change in control at fiscal 2022 year-end | 95 | |||
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Executive compensation
Named Executive Officers
As determined in accordance with SEC rules, our “namednamed executive officers”officers (“NEOs”) for 20182022 are:
| Rohit Kapoor, our Vice Chairman and |
| Maurizio Nicolelli, our Executive Vice President and | |
| Vikas Bhalla, our Executive Vice President and | |
| Vivek Jetley, our Executive Vice President and Business Head, Analytics | |
| Ankor Rai, our Executive Vice President and Chief | |
Executive summary
Select 2022 financial and business highlights
Our annual revenues increased 25.8% from $1.12 billion in fiscal year 2021 to $1.41 billion in fiscal year 2022. Analytics revenue increased 40.5% and digital operations and solutions revenue increased 15.6%.
We improved our net income attributable to stockholders by 24.6% from $114.8 million to $143.0 million.
Our diluted EPS increased from $3.35 to $4.23, an increase of 26.1%.
We added approximately 8,000 employees to our global workforce, mainly in our delivery centers.
In 2022, the Company returned capital to stockholders by repurchasing $68.5 million of shares. The Company’s board of directors authorized a $300 million common stock repurchase program beginning January 1, 2022.
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Executive Summarycompensation
2018 Financial Highlights
We improved our annual revenues from $762.3 million in fiscal year 2017 to $883.1 million in fiscal year 2018 (an increase of over 15%), completed one acquisition and closed a strategic $150 million convertible notes investment from The Orogen Group. In addition, we increased our global footprint with the opening of three delivery centers, won 50 new clients, received numerous awards and industry recognitions and launched a global version of our analytics-driven subrogation platform Subrosource™ to derive additional recoveries, which has been deployed across Europe, UK, Europe and Asia.
Our Compensation Committee paid bonuses as a result of our achievement of 97.7% of our revenue target and 88.2% of our adjusted profits before tax (“Adjusted PBT”) target, and based on achievement of individual and other performance measures as described below.
Total Stockholder Return
stockholder return
The following graphs below compare our 1-year, 3-year and 5-year cumulative total stockholder return (“TSR”) as of December 31, 2022, with thatthe median TSR of the companies comprising Nasdaq, S&P 500600 and our peer group. As shown in the table, our 1-Year, 3-Year and 5-YearTSR outperformed all but one of our market benchmarks.
1-Year TSR
| 3-Year TSR
| 5-Year TSR
|
Our people are our primary assets, and they continue to be recognized across the industry.
As in prior years, we continued to receive numerous industry recognitions and awards, including:
Customer’s Choice in Gartner®Peer |
Analytics Service Providers
Acquisitions, Finance and Equity Transactions
Leader in Everest Group |
Awards and Industry Recognition
Healthcare Analytics Service Providers PEAK Matrix® Assessments
Clients and Operations
Leader in Gartner®Magic Quadrant™ for Finance and |
Leader in all four categories in the |
Leader in Everest Group Digital Platform & Augmentation Suite in Insurance BPS PEAK Matrix® Assessment |
Luminary in Celent New Business and |
| – | Leader in Everest Group Property & Casualty Insurance BPS PEAK Matrix® |
| – | Leader in all three categories in the ISG Provider Lens™ for Insurance Services: P&C Insurance BPO Services, Life & Retirement Insurance BPO Services and Life & Retirement TPA Services |
| – | Best in KLAS 2022 for Risk Adjustment |
| – | Best in Class in the Aité Matrix: Payment Integrity in Healthcare |
| – | Leader in Everest Group Healthcare Payer Operations PEAK Matrix® Assessment 2022 |
Clients and operations
In 2022, we won 59 new clients, adding to the 58 new clients we won in 2021.
In the past year, revenue from our top 20 clients grew by 18.4%, with 16 of those clients contracting for our services and solutions in both analytics and digital operations and solutions.
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Executive compensation
Summary of Key Compensation Considerationskey compensation considerations & Decisionsdecisions in 2018
2022
The following highlights the Compensation and Talent Management Committee’s key considerations and compensation decisions in 20182022 and with respect to performance for 2018.2022 for our NEOs.
Items | Considerations and | |
| Say on Pay Approval | Over 99% of our stockholders approved, on a non-binding basis (excluding broker non-votes), of our compensation of our | |
| Base Salaries | Base salaries | |
| Annual | We based our annual | |
| Equity Incentives | This was the third and final performance year for the performance-based restricted stock units | |
Pay-for-performance
Our executive compensation philosophy is focused on pay-for-performance. In this regard, we link a significant portion of each NEO’s total compensation to the achievement of specified performance goals. This variable compensation is “at-risk” and rewards performance and contributions to both short- and long-term financial performance.
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Executive compensation
Key Corporate Governance FeaturesAs illustrated by the following charts, the majority of compensation that may be earned by our named executive officers is tied to the achievement of financial performance metrics (annual incentive awards and PRSUs) or fluctuates with the underlying value of our common stock (RSUs).
| Vice Chairman & CEO | NEO compensation mix | |
| compensation mix | (Excluding Vice Chairman & CEO) | |
 |  | |
*Base salary also includes other compensation
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Executive compensation
Executive compensation program, practices and policies
Our compensation programs, practices and policies are reviewed and re-evaluated periodically regularly and are subject to change from time to time.time in line with market best practices, including alignment of pay with performance. Our executive compensation philosophy is aligned with our core values, focused on pay for performancepay-for-performance and is designed to reflect appropriate governance practices aligned with the needs of our business. Listed below are some of the Company’s more significant practices and policies that were in effect during fiscal 2018,year 2022, which were adopted to drive performance and to align our executives’ interests with those of our stockholders.
What we do |
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| Align our executive pay with performance: We link a significant portion of each NEO’s total compensation to the achievement of specific performance
Variable compensation is |
| No option repricing: We prohibit option repricing without stockholder approval. | |||
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| No option backdating or discounting: We prohibit option backdating and discounting. | |||
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| No excessive overhang or dilution: We do not have excessive overhang or dilution from equity grants. | |||
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Executive compensation
| Maintain an | and consultant:Compensation decisions for our NEOs are approved by a Compensation and Talent Management Committee composed of non-employee independent directors.
Our Compensation and Talent Management Committee is advised by an independent consultant who reports directly to the Compensation and Talent Management Committee | ||||
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Limited perquisites:We provide our named executive officers with only limited perquisites and personal benefits that serve an important business purpose in addition to the regular benefits offered to all employees.
We consider the perquisites and personal benefits that we offer to our executives in India to be customary benefits which allow us to remain competitive for top talent. | |||||||
| Mitigate risks: The mix and design of our compensation programs serves to mitigate operational, financial, legal, regulatory, strategic and reputational risks. |
| No | tax gross-ups:We do not provide | |||
| Maintain a clawback policy: We maintain a compensation recovery policy that allows the Company to recover compensation (including cash and/or |
| No hedging: We maintain a policy | ||||
| Maintain a robust stock ownership policy: We maintain a stock ownership policy that requires our CEO to maintain aggregate stock ownership equal to at least six times his base salary and vested stock ownership equal to at least three times his base salary, and that, effective as of January 1, 2022, requires the other members of our executive committee to maintain vested stock ownership equal to at least two times their respective base salaries. Covered executives have three years from
As of December 31, 2022, all covered executives and directors were in compliance with the stock ownership policy. |
| No pledging: Under our policy mentioned above, Reporting Persons (as defined above) are only permitted to pledge shares of our stock that exceed those required to be owned under our Stock Ownership Policy described above. | ||||
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Executive compensation
Overview of Compensation Policiescompensation policies and Philosophies
philosophies
We believe that theour long-term success of companies that provide outsourcing, transformation and analytics services globally is linked to theirour ability to recruit, train, motivate and retain employees at every level. There is significant competitive pressure in our industry for qualified managers with a track record of achievement. It is critical that we recruit, train, motivate and retain highly talented individuals at all levels of the organization who are committed to our core values of innovation, collaboration, excellence, integrity and mutual respect. We believe that our executive compensation programs are integral to achieving this end.
Our Compensation and Talent Management Committee bases its executive compensation programs on the following objectives, which guide us in establishing all of our compensation programs:
Compensation should be based on | |
responsibility | |
Our top-tier compensation in return for top-tier individual and company lower tier compensation for individual performance and/or our performance that falls short of | |
Pay-for-performance and retention must be motivation and employees. |
Compensation based onresponsibility and performance
Compensation should balance long-term and short-term |
Equity-based compensation should be higher for persons with higher levels of responsibility and greater influence on long-term |
Compensation should balancelong-term and short-termobjectives
To enable us to attract and retain top talent, compensation should reflect the value of the job in the marketplace. |
Compensation programs should be easy to understand. |
Compensation should be uniformly across the objectives and performance metrics. |
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Compensation programs should beeasy to understandExecutive compensation
Compensation process: roles and responsibilities
Our Compensation Committee’s Processes
Our Compensationand Talent Management Committee has established a number of processes to assist it in ensuring that our executive compensation programs are achieving their objectives. Among thoseOur Compensation and Talent Management Committee, our management and our independent compensation consultant are the following:each engaged in these processes, as described in greater detail below.
Company performance – Compensation and Talent Management Committee | Establishment of At the beginning of each year, or the end of the Assessment of At the end of the |
Individual performance | The evaluation of an individual’s performance determines a portion of the payouts |
Assessment of Vice Chairman and CEO performance For Assessment of performance for all other NEOs and executive officers For all other NEOs and executive officers, Mr. Kapoor makes a performance assessment and compensation recommendation Our |
Other matters relevant to compensation decisions |
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(1) Convergys Corporation was acquired by SYNNEX Corporation in October 2018.
(2) DST Systems was acquired by SS&C Technologies in April 2018.
The compensation data for our peer group is compiled directly by FW Cook, the independent consultant to the Compensation Committee. The peer group compensation data was supplemented by global general industry and industry-specific survey data. The data from the surveys was scaled to our size by FW Cook based on revenues or corresponding revenue ranges as provided by the surveys. Management separately engaged Aon Consulting for the limited purpose of providing a survey of compensation data (the parameters of which were not prepared by Aon Consulting) for individuals in our global general industry holding analogous positions to our executive officers. While the Compensation Committee reviewed and considered the data provided by these surveys, it did not consider or review the compensation paid to executives at the component companies included within such surveys and did not use this information or any other data as a definitive benchmark to set executive compensation for fiscal year 2018.
Our Compensation Committee uses the compensation data to obtain a general understanding of current market practices, so it can design our executive compensation program to be competitive. Market data is not used exclusively, but rather as a point of reference to draw comparisons and distinctions. The Compensation Committee also takes into account an executive officer’s job responsibilities, performance, qualifications and skills in determining individual compensation levels.
Our Compensation |
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Executive compensation
Independent compensation consultant | For 2022, the Compensation • reviewing our executive pay philosophy • collecting and evaluating external market data regarding executive compensation and performance, • selecting peer group companies, • reviewing the • advising the Compensation and Talent Management Committee on developing trends and best practices in executive • advising the Compensation and Talent Management Committee on incentive plan In addition, Farient advises our Nominating and Corporate Governance Committee regarding director compensation. Other than performing these consulting services, | |||||
Peer market data Compensation and Talent Management Committee and independent compensation consultants | We review peer compensation data on an annual basis in order to set compensation for each following year. At the time compensation decisions were made for our senior executive officers in 2022, our Compensation and Talent Management Committee reviewed publicly available compensation data. In partnership with our independent compensation consultant, we have established a list of criteria to assess the relevance of different companies to be included in our compensation peer group. The criteria by which we select our peers includes companies that are in similar industries as us, have similar business models as us (operating in similar markets, requiring similar executive talent skills and subject to similar market forces), and are within a revenue range of around half our revenues to four times our revenues. The following chart shows the companies that make up our peer group as well as the respective industries and revenues of each: | |||||
| Company | Industry | Revenue ($MM, USD) | ||||
| EPAM Systems, Inc. | IT Consulting and Other Services | $4,825 | ||||
| Genpact Limited | Data Processing and Outsourced Services | $4,371 | ||||
| Splunk Inc. | Application Software | $3,654 | ||||
| Verisk Analytics, Inc. | Research and Consulting Services | $2,497 | ||||
| TTEC Holdings, Inc. | Data Processing and Outsourced Services | $2,444 | ||||
| Teradata Corporation | Systems Software | $1,795 | ||||
| ExlService Holdings, Inc. | Data Processing and Outsourced Services | $1,412 | ||||
| Fair Isaac Corporation | Application Software | $1,377 | ||||
| WNS (Holdings) Limited | Data Processing and Outsourced Services | $1,110 | ||||
| CSG Systems International, Inc. | Data Processing and Outsourced Services | $1,090 | ||||
| MultiPlan Corporation | Health Care Technology | $1,080 | ||||
| Perficient, Inc. | IT Consulting and Other Services | $ 905 | ||||
| Guidewire Software, Inc. | Application Software | $ 813 | ||||
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Executive compensation
We use a separate peer group for measuring performance under our PRSUs, as described under “Compensation—Fiscal year 2022 awards.” Management also used compensation survey data from Aon Consulting, comprising companies within our global industry with whom we compete for talent. While the Compensation and Talent Management Committee reviewed and considered the data provided by these surveys, it did not consider or review the compensation paid to executives at the component companies included within such surveys and did not use this information or any other data as a definitive benchmark to set executive compensation for fiscal year 2022. Our Compensation and Talent Management Committee reviews compensation information provided by Farient and other third-party data in order to evaluate each executive’s base pay, annual incentives and equity incentives when changes in compensation are considered. Compensation decisions are designed to promote our fundamental business objectives and strategy. Our Compensation and Talent Management Committee uses the compensation data to obtain a general understanding of current market practices, so it can design our executive compensation program to be competitive. Market data is not used exclusively, but rather as a point of reference to draw comparisons and distinctions. | ||||||
Components of Executive Compensationexecutive compensation for 2018
2022
For 2018,2022, the compensation of executive officers consisted of the following five primary components:
Compensation component | Description | Objectives | ||
Base | Fixed compensation that is reviewed annually and is based on performance, experience, responsibilities, skill set and market value. |
Provide a base level of compensation that corresponds to the job function performed.
Attract, retain, reward and motivate qualified and experienced executives. | ||
Annual |
“At-risk” compensation earned based on performance measured against pre-established annual goals.
75% of each NEO’s award is tied to | Incentivize executives to achieve annual goals that ultimately contribute to long-term company growth and stockholder return. | ||
Long-term incentives |
“At-risk” compensation in the form of restricted stock unit awards whose value fluctuates according to stockholder value.
40% of the award vests based on continued service.
60% vests based on achievement of revenue and total stockholder return goals. In addition, for 2022, certain executives had the ability to receive share matching awards, as described in greater detail below. |
Align executive interests with those of stockholders.
Reward continuous service with the company.
Incentivize executives to achieve goals that drive company performance over the long-term. |
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Executive compensation
Compensation component | Description | Objectives | ||
Other | Broad-based benefits provided to company employees (e.g., health and group insurance), a retirement savings plan and other personal benefits where appropriate. | Provide a total compensation package that is competitive with the marketplace and addresses unique needs, especially for overseas executives. | ||
Severance and |
Protect executives during potentially tumultuous corporate transaction.
Provide reduced post-employment compensation upon other involuntary terminations. |
Allow executives to focus on generating stockholder value during a change in control transaction.
Provide market-competitive post-employment compensation recognizing executives likely require more time to find subsequent employment. |
Compensation Mix
Consistent with our compensation philosophy, our compensation program balances base salary, short-term incentive and long-term incentive opportunities provided to our executive officers. The following charts illustrate the mixDetailed review of target compensation components for the Vice Chairman and CEO and the other named executive officers during the 2018 fiscal year.
As illustrated by the charts below, the majority of compensation that may be earned by our named executive officers is tied to the achievement of financial performance metrics (annual performance bonuses and PRSUs) or fluctuates with the underlying value of our common stock (RSUs).
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Detailed Review of Compensation Components
Base Salarysalary
As discussed above, we provide our executive officers fixed compensation commensurate with their performance, experience, responsibilities, skill set and market value. This attracts and retains an appropriate caliber of talent for the position and provides a base wage that is not subject to our performance risk. In setting base salaries for 2018,2022, our Compensation and Talent Management Committee considered:
| Individual | The degree to which the executive met and exceeded expectations. | |
| Market | ||
| Overall | Senior employees should have a greater portion of their compensation tied to increasing stockholder value. | |
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Executive compensation
Upon completing its review, and as shown in the table below, and considering base salaries were held constant for 2017, the Compensation and Talent Management Committee determined that it was appropriate to increase the base salarysalaries for eachall of our named executive officers, effective as of October 1, 2022. Noting that, as of that date, it had been one and a half years since any base salary increase for Mr. Bhalla and Mr. Jetley and almost three years since any base salary increase for Mr. Nicolelli, the Compensation and Talent Management Committee determined that base salary increases were warranted in recognitionorder to align more closely to the median of theirthe market, including in light of the internal promotion of certain of our NEOs, Mr. Jetley and Mr. Rai, within the last several years, and account for individual contributionsperformance. In addition, Mr. Jetley’s base salary increase recognizes the significant growth in Analytics over the past year, and Mr. Rai’s recognizes the importance of the Company’s performance.digital strategy. The fixed compensation paid toamount for Mr. Bagai is paid in Indian Rupees but we have included the percentage increase with respect to his fixed compensation in U.S. dollars. Further, this amountBhalla covers not only base salary, for Mr. Bagai, but also amounts available as a travel allowance, an automobile allowance, a housing allowance, a medical allowance and a cash supplementary allowance, consistent with compensation practices in India.
Name | 2017 Base Salary / | 2018 Base Salary / |
% Increase / | ||||
| Rohit Kapoor | $ | 620,000 | $ | 720,000(2) | 16.13% | ||
| Vishal Chhibbar | 400,000 | 450,000 | 12.50% | ||||
| Pavan Bagai | 360,106(1) | 407,077(3) | 13.04% | ||||
| Nagaraja Srivatsan | 415,000 | 450,000 | 8.43% | ||||
| Nalin Miglani | 410,000 | 450,000 | 9.76% | ||||
Name | 2021 Base salary / | 2022 Base salary / | % | |||||||||
| Rohit Kapoor | 750,000 | 815,000 | 8.67 | % | ||||||||
| Maurizio Nicolelli | 475,000 | 510,000 | 7.37 | % | ||||||||
| Vikas Bhalla | INR 24,500,000(1) | INR 27,900,000(2) | 13.88 | % | ||||||||
Vivek Jetley | 420,000 | 500,000 | 19.05 | % | ||||||||
Ankor Rai | 410,000 | 450,000 | 9.76 | % | ||||||||
(1) Equivalent to $329,611, converted at 74.33 INR to 1 USD, which was the exchange rate on December 31, 2021.
Incentive Bonus(2) Equivalent to $337,282, converted at 82.72 INR to 1 USD, which was the exchange rate on December 30, 2022.
Annual incentives
We have established an annual incentive bonus program in order to align our executive officers’ goals with our performance targets for the current year and to encourage meaningful contributions to our future financial performance. Our Compensation and Talent Management Committee approved the framework of our annual incentive bonus program in December 2017late 2021 for the year 2018 for bonusesawards payable in respect of 20182022 performance. Under the program, bonusannual incentive award target amounts, expressed as a percentage of base salary or annual fixed compensation, are established for participants at the beginning of each year unless their employment agreements contain different terms. Funding of potential bonusannual incentive award payouts for the year are determined by our financial results for the year relative to predetermined performance measures and our assessment of each named executive officer’s performance relative to his predetermined individual performance goals. If our performance falls short of target, our aggregate funding of the annual cash bonus incentive pool declines. If we do not achieve a minimum threshold for the established financial performance objectives, then the bonusannual incentive pool is not funded for that particular objective. Although the Compensation and Talent Management Committee has not historically done so, except in 2020 in light of the unanticipated impact of the COVID-19 pandemic, it has the discretion under the 2018 Plan to adjust an award payout from the amount yielded by the formula at the end of the performance period.period for reasons such as the effect of changes in laws or regulatory rules, acquisitions or divestitures, extraordinary accounting items, foreign exchange gains or losses, and/or any specific unusual or non-recurring events. The Compensation and Talent Management Committee did not use any discretion for the 2022 annual incentive awards.
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Executive compensation
Our Compensation and Talent Management Committee considered the following when establishing the awards for 2018:2022:
Annual incentive award targets
Annual incentive award targets were established based on job responsibilities and comparable market data. Our objective was to set targets such that total annual cash compensation was within the broad middle range of market data and a substantial portion of that compensation was linked to our performance. Consistent with our executive compensation policy, individuals with greater job responsibilities had a greater proportion of their total compensation tied to our performance. During 2022, our Compensation and Talent Management Committee established the following annual incentive award targets (expressed as a percentage of base salary or annual fixed compensation) as well as maximum targets for each named executive officer.
Name
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| Rohit Kapoor | 150% of base salary | 300% of base salary | ||
| Maurizio Nicolelli | 75% of base salary | 150% of base salary | ||
| Vikas Bhalla | 75% of annual fixed compensation | 150% of annual fixed compensation | ||
| Vivek Jetley | 75% of base salary | 150% of base salary | ||
| Ankor Rai | 75% of base salary | 150% of base salary | ||
Performance measures
Name | Company-Wide | Individual | Business Line or Other |
| Rohit Kapoor | 65% | 15% | 20% |
| Vishal Chhibbar | 60% | 20% | 20% |
| Pavan Bagai | 65% | 15% | 20% |
| Nagaraja Srivatsan | 60% | 20% | 20% |
| Nalin Miglani | 60% | 20% | 20% |
Our executives were eligible to earn annual incentives with 75% of the award based on their achievement of Company-wide performance metrics and the remaining 25% of the award based on individual performance. The Company-wide portion of 2022 annual incentives was based 50% in part on the Company’s revenue goal, and 50% in part on the Company’s adjusted operating profit margin (AOPM) for all employees, including our named executive officers, whose annual incentives are linked to Company-wide financial performance.
In 2018,2022, the Compensation and Talent Management Committee continued to set the business line and other CompanyCompany-wide performance goals, as well as the individual performance goals described above, for all named executive officers to ensure the executives were properly focused on both the Company’s Adjusted PBT and revenue goals, aggregate of business units’ performance on revenue and Adjusted PBTAOPM goals, andas well as other areas of performance that are unique to their positions within the organization. We decided to move away from basing our annual bonus in part on Adjusted EPSThe Compensation and instead, to base it in part on Adjusted PBT targets because of the uncertain effect of proposed U.S. tax reforms on the Company and the Adjusted EPS calculation. Adjusted PBT, by its nature, is a measure that is unaffected by the then-current year’s taxation. The CompensationTalent Management Committee believes achievement of these performance metrics will drive our business and, in turn, lead to increased stockholder value.
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Executive compensation
Determination of financial performance achievement
For 2022, our Compensation and Talent Management Committee established a revenue target of $1.33 billion (which was 18.8% higher than our actual revenue for the prior year and 23.4% higher than our prior year’s target performance) and an AOPM target of $247.37 million (which was 18.7% higher than our actual for the prior year and 38.3% higher than our prior year’s target). As shown below, the portion of annual incentive award payments that were subject to these financial performance measures could have ranged from zero to 200% of the target depending on the achievement of the performance goals.
Performance targets: revenue ($1.33 billion); and AOPM ($247.37 million) | ||
% of | % of target | |
Above 110% | 200% | |
At 100% | 100% | |
At 90% | 10% | |
Less than 90% | 0% | |
Adjusted PBT Goals | Revenue Goals | |||
| % of Adjusted PBT Achieved Compared to Target Goal | % of Target Portion Funded | % of Revenues Achieved Compared to Target Goal | % of Target Portion Funded | |
| Less than 90% | 0% | Less than 90% | 0% | |
| At 90% | 25% | At 90% | 25% | |
| From 90% to 100% | Linear interpolation from 25% to 100% | From 90% to 100% | Linear interpolation from 25% to 100% | |
| At 100% | 100% | At 100% | 100% | |
| From 100% to 110% | Linear interpolation from 100% to 200% | From 100% to 110% | Linear interpolation from 100% to 200% | |
| Above 110% | 200% | Above 110% | 200% | |
Linear interpolation for performance between discrete points
In 2018, our Compensation Committee established an Adjusted PBT target of $141.3 million and a revenue target of $867.0 million. Based on our performance during the 20182022 fiscal year, we achieved 88.2% of our Adjusted PBT target, and 97.7%107.66% of our revenue target.
The bonus pooltarget (resulting in funding for employees whose bonuses are tied to the performance of specific business lines is determined by targets established for such businesses by176.63%) and 101.45% of our Compensation Committee.AOPM target (resulting in funding of 114.51%), which yielded a weighted funding of 145.57%.
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Executive compensation
Determination of individual performance measure achievement
Our named executive officers earn a portion of their annual incentive awards based on the achievement of individual performance measures designed to balance the named executive officers’ efforts between the achievement of near-term objectives that improve specific processes or performance metrics and long-term objectives that increase the Company’s value, economic impact, and sustained stockholder returns. For more information on the process for determining individual performance measure achievement, please see “Compensation process: roles and responsibilities” on page 72. Below is a summary of each named executive officer’s individual performance measures, as well as a summary of each named executive officer’s achievements in light of the designated performance measures:
Named Executive Officer | 2022 Individual | 2022 Individual performance achievement | ||
Rohit Kapoor | • Drive profitability with sustained momentum • Execute on EXL’s digital and analytics strategy • Strengthen talent acquisition and development and company culture, including focus on diversity, equity and inclusion strategies • Ensure agile decisioning and strengthen enterprise risk management • Continue to advance ESG program | • Led growth resulting in 2022 revenues of • Established company-wide data-led mission as relates to digital and analytics solutions • Continued focus on talent acquisition and strong progress on building diverse and expanded leadership and key digital and data-related capabilities • Continued to strengthen overall risk culture • Progressed on ESG matters as outlined in EXL’s third Annual Sustainability Report | ||
Maurizio Nicolelli | • Provide effective leadership to finance team • Enhance profitability • Execute on long-term tax strategy | • Led the finance team and the technology and LIFE functions effectively with strong business partnering and by nurturing One EXL mindset • Drove strong profitability across business units • Drove long-term tax strategy resulting in current benefits and a pathway to future benefits | ||
Vikas Bhalla | • Drive profitability for Insurance • Create and implement innovative data and analytics solutions for Insurance clients • Grow Insurance profitability | • Drove Insurance revenue (including portion of • Developed and • Drove strong Insurance business profitability | ||
Vivek Jetley | • Drive profitability and • Build EXL’s data management and | • Facilitated high revenue growth • Created significant foundational capabilities in data management and cloud enablement areas | ||
Ankor Rai | • Drive digital implementation • Execute on EXL’s digital strategy | • Executed successful digital implementations across business units and clients • Developed and amplified EXL’s data led approach to digital strategy both internally and externally | ||
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Executive compensation
The table below sets out the 2022 annual incentive awards paid to our named executive officers (paid in March 2023):
| Name | 2022 Actual incentive | |
Rohit Kapoor | 1,829,887 | |
Maurizio Nicolelli | 554,929 | |
Vikas Bhalla | 357,340 | |
Vivek Jetley | 525,488 | |
Ankor Rai | 481,822 | |
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| (1) | The exchange rate used for the |
Long-Term Equity IncentivesLong-term equity incentives
The Compensation and Talent Management Committee continues to believe thatbelieves long-term equity awards provide employees with the incentive to stay with us for longer periods of time, which in turn provides us with greater stability as we grow. These incentives foster the long-term perspective necessary for continued success in our business because the value of the awards is directly linked to long-term performance of our stock price, performance, and they ensure that our executive officers are properly focused on stockholder value.
Moreover, the Compensation and Talent Management Committee favors restricted stock unit awards asbecause these awards offer executives the opportunity to receive shares of our common stock on or shortly following the date that the restrictions lapse. Such awards serve both to reward and retain executives because value is linked to the price of our stock on the date that the restriction lapses, and the executive must generally remain in employmentemployed by the Company through the date that the restrictions lapse. RestrictedFor these reasons, restricted stock unit awards provide a significant degree of alignment ofbetween the interests betweenof our executives and stockholders.
The Compensation and Talent Management Committee also believes that the mix between Time-Vested RSUs and Performance-Vested RSUs provides an appropriate balance between incentivizing our executives to continue their employment with the Company and to ensureensuring they are focused on generating long-term financial performance and generatingsustained stockholder value, which, will enable them to realizein turn, results in additional compensation.
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Finally, restricted stock units are potentially less dilutive to stockholders’ equity than stock options because restricted stock awards are full value awards, and our Compensation Committee can award fewer shares than an equivalent value of stock options.
Executive compensation
Compensation
Fiscal Year 2018 Awards
year 2022 awards
Under our equity compensation program, our executive officers received restricted stock units under the 2015 Amendment and Restatement of the 2006 Omnibus Award Plan (the “2015 Plan”). Subsequent awards were made pursuant to the 2018 Omnibus Incentive Plan approved by the Company’s stockholders at the annual meeting of stockholders held in June 2018.2018 (the “2018 Plan”). We awarded restricted stock units to nearly all of our named executive officers in the portionsproportions shown below. In 2021, in response to the COVID-19 pandemic, we temporarily revised our long-term equity incentive program for 2021 only to remove the revenue performance metric. Therefore, in 2022, we reinstated the revenue performance metric and returned to our pre-2021 practice of awarding performance-based restricted stock units with a portion subject to revenue-based performance metrics and a separate portion subject to TSR-based performance metrics. In addition, we adjusted the overall weighting of our restricted stock units to change the total percentage of PRSUs from 50% to 60% to further increase the percentage of incentive compensation tied to performance.
| 40% | + | 36% | + | 24% | = | Total | ||||||
Time-vested RSUs | Relative TSR-linked PRSUs | Revenue-linked PRSUs | LTI award | |||||||||
The table below shows the amount of Time-Vested and Performance-Vested RSUs our Compensation and Talent Management Committee awarded our named executive officers in 2022. In general, the Compensation and Talent Management Committee believes that the size of the award granted to an executive officer should increase based on the executive officer’s level of responsibility within the Company.
| Name | Annual Time-Vested RSUs | Relative TSR-Linked PRSUs | Revenue-Linked PRSUs | |||||||||
Rohit Kapoor | 25,164 | 22,647 | 15,099 | |||||||||
Maurizio Nicolelli | 3,884 | 3,495 | 2,331 | |||||||||
Vikas Bhalla | 4,348 | 3,913 | 2,609 | |||||||||
Vivek Jetley | 4,040 | 3,636 | 2,424 | |||||||||
Ankor Rai | 3,108 | 2,797 | 1,865 | |||||||||
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Executive compensation
The “Time-Vested RSUs” will vest in increments of 25% on each of the first four anniversaries of the grant date, subject to continuous service with the Company through the applicable vesting date.
| – | The Compensation and Talent Management Committee believes these Time-Vested RSUs provide an important role in promoting retention of our executive officers. |
The “Performance-Vested” portion of the 2022 RSUs (“PRSUs”) are split into two types that each vest based on separate performance measures as follows:
| – | Revenue-Linked PRSUs: |
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| Revenue target achievement | Percentage of Revenue-Linked PRSUs earned | |
110% or more | 200% | |
At 100% | 100% | |
90% | 25% | |
| – | Relative TSR-Linked PRSUs: The remaining |
The percentage of Relative TSR-Linked PRSUs earned will be determined based on straight-line interpolation to the extent the Company’s TSR falls in between the 20th and 80th percentiles, as per the chart below:
TSR Peer Group Percentile | Percentage of Relative TSR-Linked PRSUs Earned |
| 80.0 or more | 200% |
| 65.0 | 150% |
| 50.0 | 100% |
| 35.0 | 50% |
| 20.0 or less | 0% |
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Executive compensation
The percentage of Relative TSR-Linked PRSUs earned will be determined based on straight-line interpolation to the extent the Company’s TSR falls in between the 20th and 80th percentiles, as per the chart below: |
| TSR peer group percentile | Percentage of Relative TSR-Linked PRSUs earned | |
80.0 or more | 200% | |
65.0 | 150% | |
50.0 | 100% | |
35.0 | 50% | |
20.0 or less | 0% | |
| – | The Compensation and Talent Management Committee believes the PRSUs focus our executives on key drivers of our Company’s business that will ultimately lead to creation of additional stockholder value. |
In 2022, we also adopted a Share Matching Program (“SMP”) under the 2018 Plan to promote long-term ownership and alignment of executive and stockholder interest. The SMP generally entitles a participant to one restricted stock unit for every share of Company common stock newly acquired and held by the participant during a specified acquisition period, up to a pre-established maximum of $500,000. For purposes of the match, “newly acquired shares” includes the employee’s first quarter 2022 open market purchases of our common stock, and/or, to the extent elected by the employee, the after-tax value of equity vesting in the first quarter 2022, in an amount between $100,000 to $500,000 per such employee. In general, as long as a participant continues to hold his or her newly acquired shares and remains employed with the Company, the associated restricted stock units received will cliff vest in two installments with one-third vesting on the second anniversary of the grant date and the remaining two-thirds vesting on the third anniversary of the grant date. In addition, each award agreement requires the executive to hold any shares of Company stock acquired under the SMP for a period of two years following the applicable settlement date. Accordingly, participation in the SMP ties the executive’s compensation to the Company’s stock performance for a total of five years. The SMP is designed to encourage key executives to acquire a larger equity ownership interest (up to an additional $1 million of stock value that effectively must be held for five years) in the Company, thereby further aligning the interests of these key executives with the interest of stockholders.
The table belowEach of the NEOs, other than Mr. Kapoor, received a share matching award of 4,177 restricted stock units in 2022 as a result of his acquisition of shares that qualified under the SMP as newly acquired. Those NEOs took full advantage of this program and participated near the maximum limit, which shows our NEOs’ long-term commitment to the Company.
Finally, our modified executive stock ownership policy, which went into effect in 2022, doubles the amount of Time-Vested and Performance-Vested RSUs our Compensation Committee awarded our named executive officers in 2018. In general, the Compensation Committee believesCompany equity that the size of the award granted to aneach executive officer should increase basedother than the CEO is expected to maintain (see “Maintain a robust stock ownership policy” on thepage 70), which serves to further align executive officer’s level of responsibility within the Company.and stockholder interests.
Name | Time Vested RSUs | Revenue-Linked PRSUs | Relative TSR-Linked PRSUs |
| Rohit Kapoor | 30,005 | 15,003 | 15,002 |
| Vishal Chhibbar | 7,350 | 3,675 | 3,675 |
| Pavan Bagai | 10,600 | 5,300 | 5,300 |
| Nagaraja Srivatsan | 5,960 | 2,980 | 2,980 |
| Nalin Miglani | 6,410 | 3,205 | 3,205 |
| EXL 2023 Proxy Statement | / | 83 |
Executive compensation
Payout of Awards Grantedawards granted in Prior Fiscal Years
prior fiscal years
This was the third and final performance year for the 20162020 performance-based restricted stock units. We achieved 90.52%101.6% of the revenue target for the revenue-linked restricted stock units resulting in 5.24%100% of target funding of those grants. The Company’s TSR performance was at the 40th97.6 percentile amongstamong its peer group, resulting in the executives earning 68.25%200% of the 20162020 relative TSR-linked restricted stock units pursuant to the terms of the original grant. No adjustments were made to the 2020 performance-based restricted stock units or the associated performance targets to account for the impact of the COVID-19 pandemic in the 2020, 2021 and 2022 fiscal years.
Benefits and Perquisites
perquisites
We offer employee benefits coverage in order to:
provide our global workforce with a reasonable level of financial support in the event of illness or injury; and |
provide market-competitive benefits that enhance productivity and job satisfaction through programs that focus on work/life balance.
The benefits available for all U.S. employees include customary medical and dental coverage, disability insurance and life insurance. In addition, our 401(k) plan provides a reasonable level of retirement income reflecting employees’ careers with us. A number of our U.S. employees, including our U.S.-based named executive officers, participate in these plans. The cost of employee benefits is partially borne by our employees, including our named executive officers. Our named executive officerofficers in India, Mr. Bagai,Bhalla, is eligible to participate in the Company’s pension benefit, health and welfare and fringe benefit plans otherwise available to executive employees in India.
We generally do not provide significant perquisites or personal benefits to executive officers other than our Vice Chairman and CEO and our executive officers in India. Our Vice Chairman and CEO is provided a limited number of perquisites which we believe are reasonable and consistent with market trends, which are intended to be part of a competitive overall compensation program. A discussion of the benefits provided to our Vice Chairman and CEO is provided under “Employment Agreements”agreements” beginning on page 56.90.
Risk and Compensation Policies
compensation policies
Our Compensation and Talent Management Committee has taken into account its discussions with management and FW CookFarient regarding our compensation practices and has concluded that any risks arising from our compensation policies and practices are not reasonably likely to have a material adverse effect on the Company. This conclusion was based on the features of our compensation programs, practices and policies set forth under “Key Corporate Governance Features”“Executive compensation program, practices and policies” on page 37.69.
Severance and Change-in-Control Benefits
change-in-control benefits
Each named executive officer, including Mr. Bhalla and Mr. Jetley as of April 2022, is party to an employment agreement or letter that sets forth the terms of his or her employment, including compensation, which was negotiated through arms’-length contract negotiations. Under these employment agreements or letters, we are obligated to pay severance or other enhanced benefits upon
| 84 | / | EXL 2023 Proxy Statement |
Executive compensation
termination of their employment. A discussion of the severance and other enhanced benefits provided to our named executive officers is provided under “Potential Paymentspayments upon Terminationtermination or Changechange in Controlcontrol at Fiscal 2018 Year-End”fiscal 2022 year-end” beginning on page 51.
95.
We have provided change-in-control severance protection for some of our executive officers, including our named executive officers. Our Compensation and Talent Management Committee believes that such protection is intended to preserve employee morale and productivity and encourage retention in the face of the disruptive impact of an actual or rumored change in control. In addition, for executive officers, the program is intended to align executive officers’ and stockholders’ interests by enabling executive officers to consider corporate transactions that are in the best interests of our stockholders and other constituents without undue concern over whether the transactions may jeopardize the executive officers’ own employment.
Senior executive officers, including our named executive officers, have enhanced levels of benefits based on their job level, seniority and probable loss of employment after a change in control. We also consider it likely that it will take more time for senior executive officers to find new employment.
Looking Forward to 2019
For fiscal 2019, we generally continued the annual bonus program and our long-term equity incentives for fiscal 2018, subject, of course, to new performance goals. As mentioned previously, the Adjusted PBT target was in place for determining a portion of the annual incentive awards in 2018 due to the uncertain effect of U.S. tax reformDeductibility cap on the Company. Since the enactment of the Tax Cuts and Jobs Act of 2017 on December 22, 2017, the Compensation Committee determined to return to the Adjusted EPS target for that portion of the 2019 annual incentive awards.
Deductibility Cap on Executive Compensation
The Tax Cuts and Jobs Act of 2017 significantly altered our ability to deduct for federal income tax purposesexecutive compensation paid to certain of our executives. Prior to its passage, Section 162(m) of the Code limited our ability to deduct compensation paid to our named executive officers (other than our chief financial officer) in excess of $1 million per year, unless the compensation was “performance-based”, as described in the regulations under Code Section 162(m). In general, the Tax Cuts and Jobs Act of 2017 eliminated the exception from Code Section 162(m)’s deduction limits for performance-based compensation, clarified that chief executive officers are covered by the deduction limitation, and made certain other changes, including providing for transition relief for written binding contracts in effect on November 2, 2017.
As in the past, our Compensation and Talent Management Committee expects to continue to take into consideration the tax deductibility of compensation, but reserves the right to authorize payments that may not be deductible if it believes that the payments are appropriate and consistent with our compensation philosophy.
Despite the changes made tolimited availability of Code Section 162(m) outlined above,performance-based compensation exceptions following the Tax Cuts and Jobs Act of 2017, our Compensation and Talent Management Committee does not anticipate a shift away from variable or performance-based compensation payable to our named executive officers. Similarly, we do not expect to apply less rigor in the process by which we establish performance goals or evaluate performance against pre-established goals with respect to compensation paid to our named executive officers.
| EXL 2023 Proxy Statement | / | 85 |
Compensation Committee ReportExecutive compensation
Compensation and Talent Management Committee Report
The Compensation and Talent Management Committee of the board of directors of ExlService Holdings, Inc. has reviewed and discussed the Compensation Discussion and Analysis with our management and, based on such review and discussion, has recommended to the board of directors of ExlService Holdings, Inc. that the Compensation Discussion and Analysis be included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2018,2022, and our proxy statementProxy Statement relating to the Annual Meeting.
Compensation and Talent Management Committee
COMPENSATION COMMITTEE
Ms. Jaynie M. Studenmund (Chair)
Ms. Anne Minto (Chair)
Ms. Deborah Kerr
Mr. Som Mittal
Mr. Clyde W. Ostler
Mr. Garen K. StaglinVikram Pandit
Ms. Jaynie M. StudenmundKristy Pipes
| 86 | / | EXL 2023 Proxy Statement |
Summary Compensation Table for Fiscal Year 2018Executive compensation
Summary compensation table for fiscal year 2022
The following table sets forth information for compensation earned in fiscal years 2016, 20172020, 2021 and 20182022 by our named executive officers:
Name and principal position | Year | Salary ($) | Bonus ($) | Stock awards ($)(2) | Non-equity incentive plan ($)(3) | Change in pension value and nonqualified deferred compensation earnings ($)(4) | All other compensation ($) | Total ($) | ||||||||||||||||||||||||||||||
Rohit Kapoor |
| 2022 |
|
| 766,384 |
|
|
|
|
| — |
|
| 8,356,213 |
|
| 1,829,887 |
|
| — |
|
| 58,423 |
| (5) |
| 11,010,906 |
| ||||||||||
Vice Chairman & CEO |
| 2021 |
|
| 742,603 |
|
|
|
|
| — |
|
| 7,209,918 |
|
| 2,050,000 |
|
| — |
|
| 31,068 |
|
|
| 10,033,589 | |||||||||||
| 2020 |
|
| 599,016 |
|
|
|
|
| — |
|
| 5,701,209 |
|
| 810,000 |
|
| — |
|
| 31,041 |
|
|
| 7,141,267 | ||||||||||||
Maurizio Nicolelli |
| 2022 |
|
| 483,822 |
|
|
|
|
| — |
|
| 1,810,865 |
|
| 554.929 |
|
|
|
|
| 9,654 |
| (6) |
| 2,859,270 |
| ||||||||||
Executive Vice President and CFO |
| 2021 |
|
| 475,000 |
|
|
|
|
| 100,000 |
|
| 2,220,441 |
|
| 640,498 |
|
| — |
|
| 9,204 |
|
|
| 3,445,143 | |||||||||||
| 2020 |
|
| 384,283 |
|
|
|
|
| 125,000 |
|
| 1,166,955 |
|
| 243,097 |
|
| — |
|
| 8,970 |
|
|
| 1,928,305 | ||||||||||||
Vikas Bhalla |
| 2022 |
|
| 265,432 |
|
| (1) |
|
| — |
|
| 1,964,960 |
|
| 357,340 |
|
| 20,200 |
|
| 18,233 |
| (7) |
| 2,626,165 |
| ||||||||||
Executive Vice President and Business Head, Insurance |
| 2021 |
|
| 276,716 |
|
|
|
|
| — |
|
| 2,711,454 |
|
| 444,718 |
|
| 16,865 |
|
| 19,034 |
|
|
| 3,468,787 | |||||||||||
| 2020 |
|
| 229,016 |
|
|
|
|
| — |
|
| 1,399,048 |
|
| 169,370 |
|
| 5,067 |
|
| 37,962 |
|
|
| 1,840,463 | ||||||||||||
Vivek Jetley |
| 2022 |
|
| 440,164 |
|
|
|
|
| — |
|
| 1,862,689 |
|
| 525,488 |
|
| — |
|
| 9,654 |
| (8) |
| 2,837,996 |
| ||||||||||
Executive Vice President and Business Head, Analytics |
| 2021 |
|
| 415,068 |
|
|
|
|
| — |
|
| 2,429,371 |
|
| 586,146 |
|
| — |
|
| 9,204 |
|
|
| 3,439,789 | |||||||||||
| 2020 |
|
| — |
|
|
|
|
| — |
|
| — |
|
| — |
|
| — |
|
| — |
|
|
| — |
| |||||||||||
Ankor Rai |
| 2022 |
|
| 420,082 |
|
|
|
|
| — |
|
| 1,553,192 |
|
| 481,822 |
|
| — |
|
| 9,654 |
| (9) |
| 2,464,750 |
| ||||||||||
Executive Vice President and Chief Digital Officer |
| 2021 |
|
| — |
|
|
|
|
| — |
|
| — |
|
| — |
|
| — |
|
| — |
|
|
| — |
| ||||||||||
| 2020 |
|
| — |
|
|
|
|
| — |
|
| — |
|
| — |
|
| — |
|
| — |
|
|
| — |
| |||||||||||
(1) The amount set forth in the “Salary” column for Mr. Bhalla includes $107,259 of base salary, $95,608 of a cash supplementary allowance, $35,496 of housing allowance (which Mr. Bhalla elected to receive instead in cash), $8,935 of travel allowance (which Mr. Bhalla elected to receive instead in cash), and $18,134 of a special car allowance (which Mr. Bhalla elected to receive instead in cash).
(2) Amounts reflect the grant date fair value of awards in accordance with FASB ASC Topic 718, recognized for financial statement reporting purposes for the fiscal years ended December 31, 2020, 2021 and 2022). Assumptions used in the calculation of these amounts are included (i) for 2022, in footnotes 2 and 23 to the audited financial statements for the fiscal year ended December 31, 2022, included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 23, 2023; (ii) for 2021, in footnotes 2 and 22 to the audited financial statements for the fiscal year ended December 31, 2021, included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 24, 2022; and (iii) for 2020, in footnotes 2 and 23 to the audited financial statements for the fiscal year ended December 31, 2020, included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 25, 2021. With respect to stock awards granted in 2022, the table below sets forth the value attributable to performance restricted stock units valued at target achievement. Performance restricted stock units granted in 2022 may pay out up to 200% of the target award, which would have amounted to the grant date fair values listed as the maximum total grant date fair value for each named executive officer in the table below.
| Name | Total grant date fair value ($) | Maximum total grant date fair value ($) | ||
Rohit Kapoor | 5,337,037 | 10,674,073 | ||
Maurizio Nicolelli | 823,740 | 1,647,480 | ||
Vikas Bhalla | 922,165 | 1,844,329 | ||
Vivek Jetley | 856,848 | 1,713,695 | ||
Ankor Rai | 659,172 | 1,318,343 | ||
|
|
|
|
|
|
|
|
| ||||
| EXL 2023 Proxy Statement | / | 87 |
Executive compensation
Name | Target Total Grant Date Fair Value ($) | Maximum Total Grant Date Fair Value ($) |
| Rohit Kapoor | 1,973,574 | 3,947,147 |
| Vishal Chhibbar | 483,446 | 966,893 |
| Pavan Bagai | 697,215 | 1,394,430 |
| Nagaraja Srivatsan | 392,019 | 784,038 |
| Nalin Miglani | 421,618 | 843,236 |
(3) Reflects the annual incentive awards earned in respect of 2022 and paid in 2023. For details on our annual incentive program, see “Compensation Discussion and Analysis—Annual incentives” beginning on page 76.
(4) Reflects the present value of accruals under the Gratuity Plan for Indian employees. Information regarding our Gratuity Plan (including the assumptions used to calculate these amounts) may be found under “Pension benefits for fiscal year 2022” beginning on page 95.
(5) Amount for Mr. Kapoor includes the travel allowance ($43,336) provided for under his employment agreement, to be used for once-a-year business class airfare for himself and his family between the United States and India, costs associated with use of an automobile and driver ($2,021), car lease rental ($3,412), contribution to our 401(k) plan ($9,150), and Company-paid life insurance premiums ($504). In addition, certain travel expenses for Mr. Kapoor’s spouse to accompany him on business trips were provided at no incremental cost to the Company.
(6) Amount for Mr. Nicolelli includes contribution to our 401(k) plan ($9,150) and Company-paid Life Insurance premiums ($504).
(7) Amount for Mr. Bhalla includes contributions to the Employees’ Provident Fund Scheme (a statutorily required defined contribution program for Indian employees) ($12,871), costs associated with use of an automobile and driver in India ($4,860), and home internet and telephone charges ($502).
(8) Amount for Mr. Jetley includes contributions to 401(k) plan ($9,150) and Company-paid Life Insurance premiums ($504).
(9) Amount for Mr. Rai includes contributions to 401(k) plan ($9,150) and Company-paid Life Insurance premiums ($504).
Unless otherwise specified, U.S. dollar figures in this proxy statementProxy Statement have been converted from Indian rupees at a rate of 69.7782.72 Indian rupees to $1.00, the Indian rupee to U.S. dollar exchange rate in effect as of December 31, 2018.30, 2022. Some of the information in the Summary Compensation Tables for fiscal years 20162021 and 20172020 was converted using the exchange rates in effect as set forth below:
Fiscal Year | Rate | Exchange Rate of INR per US$1 |
| 2017 | December 31, 2017 | 63.87 |
| 2016 | December 31, 2016 | 67.94 |
| Fiscal year | Rate | Exchange rate of INR per US$1 | ||||
| 2021 | December 31, 2021 | 74.33 | ||||
2020 | December 31, 2020 | 73.065 | ||||
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Executive compensation
Grants of Plan-Based Awards Tableplan-based awards table for Fiscal Year 2018
fiscal year 2022
The following table sets forth information concerning grants of stock and option awards and non-equity incentive plan awards granted to our named executive officers during fiscal year 2018:2022:
Estimated Future Payouts | Estimated Future Payouts | All Other Stock Awards: Number of Shares of | Grant Date Fair Value of Stock | |||||||||
Name | Grant | Threshold | Target | Maximum | Threshold | Target | Maximum | Stock or | and Option | |||
| Rohit Kapoor | 1,080,000 | 2,160,000 | ||||||||||
| 2/22/2018 | 15,003 | (2) | 30,006 | 908,882 | ||||||||
| 2/22/2018 | 15,002 | (3) | 30,004 | 1,064,692 | ||||||||
| 2/22/2018 | 30,005 | (4) | 1,817,703 | |||||||||
| Vishal Chhibbar | 313,459 | 626,918 | ||||||||||
| 2/22/2018 | 3,675 | (2) | 7,350 | 222,632 | ||||||||
| 2/22/2018 | 3,675 | (3) | 7,350 | 260,815 | ||||||||
| 2/22/2018 | 7,350 | (4) | 445,263 | |||||||||
| Pavan Bagai | 271,538 | 543,076 | ||||||||||
| 2/22/2018 | 5,300 | (2) | 10,600 | 321,074 | ||||||||
| 2/22/2018 | 5,300 | (3) | 10,600 | 376,141 | ||||||||
| 2/22/2018 | 10,600 | (4) | 642,148 | |||||||||
| Nagaraja Srivatsan | 331,027 | 662,055 | ||||||||||
| 2/22/2018 | 2,980 | (2) | 5,960 | 180,528 | ||||||||
| 2/22/2018 | 2,980 | (3) | 5,960 | 211,491 | ||||||||
| 2/22/2018 | 5,960 | (4) | 361,057 | |||||||||
| Nalin Miglani | 314,938 | 629,877 | ||||||||||
| 2/22/2018 | 3,205 | (2) | 6,410 | 194,159 | ||||||||
| 2/22/2018 | 3,205 | (3) | 6,410 | 227,459 | ||||||||
| 2/22/2018 | 6,410 | (4) | 388,318 | |||||||||
| Name | Grant date |
Estimated future payouts under non-equity incentive plan awards(1) | Estimated future payouts under equity incentive plan awards | All other number of shares of stock or units (#) | Grant Date Fair Value of Stock and Option Awards(6) ($) | |||||||||||||||||||||||||||||||
Threshold ($) | Target ($) | Maximum ($) | Threshold (#) | Target (#) | Maximum (#) | |||||||||||||||||||||||||||||||
Rohit Kapoor | 1,149,575 | 3,448,726 | ||||||||||||||||||||||||||||||||||
| 2/16/2022 | 25,164 | (4) | 3,019,177 | |||||||||||||||||||||||||||||||||
| 2/16/2022 | 15,099 | (2) | 30,198 | 1,811,578 | ||||||||||||||||||||||||||||||||
| 2/16/2022 | 22,647 | (3) | 45,294 | 3,525,458 | ||||||||||||||||||||||||||||||||
Maurizio Nicolelli | 362,866 | 544,300 | ||||||||||||||||||||||||||||||||||
| 2/16/2022 | 3,884 | (4) | 466,002 | |||||||||||||||||||||||||||||||||
| 3/31/2022 | 4,177 | (5) | 521,123 | |||||||||||||||||||||||||||||||||
| 2/16/2022 | 2,331 | (2) | 4,662 | 279,673 | ||||||||||||||||||||||||||||||||
| 2/16/2022 | 3,495 | (3) | 6,990 | 544,067 | ||||||||||||||||||||||||||||||||
Vikas Bhalla | 229,905 | 344,857 | ||||||||||||||||||||||||||||||||||
| 2/16/2022 | 4,348 | (4) | 521,673 | |||||||||||||||||||||||||||||||||
| 3/31/2022 | 4,177 | (5) | 521,123 | |||||||||||||||||||||||||||||||||
| 2/16/2022 | 2,609 | (2) | 5,218 | 313,028 | ||||||||||||||||||||||||||||||||
| 2/16/2022 | 3,913 | (3) | 7,826 | 609,137 | ||||||||||||||||||||||||||||||||
Vivek Jetley | 330,123 | 495,185 | ||||||||||||||||||||||||||||||||||
| 2/16/2022 | 4,040 | (4) | 484,719 | |||||||||||||||||||||||||||||||||
| 3/31/2022 | 4,177 | (5) | 521,123 | |||||||||||||||||||||||||||||||||
| 2/16/2022 | 2,424 | (2) | 4,848 | 290,832 | ||||||||||||||||||||||||||||||||
| 2/16/2022 | 3,636 | (3) | 7,272 | 566,016 | ||||||||||||||||||||||||||||||||
Ankor Rai | 315,062 | 472,592 | ||||||||||||||||||||||||||||||||||
| 2/16/2022 | 3,108 | (4) | 372,898 | |||||||||||||||||||||||||||||||||
| 3/31/2022 | 4,177 | (5) | 521,123 | |||||||||||||||||||||||||||||||||
| 2/16/2022 | 1,865 | (2) | 3,730 | 223,763 | ||||||||||||||||||||||||||||||||
| 2/16/2022 | 2,797 | (3) | 5,594 | 435,409 | ||||||||||||||||||||||||||||||||
(1) These amounts reflect the target and maximum annual incentive awards set for 2022. For details of our annual incentive program, see “Compensation Discussion and Analysis – Annual incentives” beginning on page 80.
(2) Represents annual awards of Revenue-Linked PRSUs granted under the 2018 Plan, subject to the vesting set forth in footnote 7.
(3) Represents annual awards of Relative TSR-Linked PRSUs granted under the 2018 Plan, subject to the vesting set forth in footnote 7.
(4) Represents annual awards of time-vested restricted stock units granted to all named executive officers under the 2018 Plan, subject to the vesting set forth in footnote 7.
(5) Represents the share matching awards granted under the 2018 Plan pursuant to the SMP and subject to the vesting set forth in footnote 7.
(6) The grant date fair value reflects valuation based on the grant date of awards in accordance with FASB ASC Topic 718.
| EXL 2023 Proxy Statement |
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| 89 |
Executive compensation
(7) The vesting schedules of the stock grants mentioned in the table below are as follows for each named executive officer (subject to continued employment through each applicable vesting date):
|
|
|
2/16/2022 | Relative TSR-Linked PRSUs: 100% vesting on 12/31/ | |
2/ | Revenue-Linked PRSUs: 100% vesting on 12/31/ | |
2/ | Time-Vested Restricted Stock Units: Vesting over 4 | |
3/31/2022 | Share Matching Restricted Stock Units: Vesting over 3 Years – 1/3 on the second anniversary and 2/3 on the third anniversary of the grant date | |
Employment Agreements
agreements
In addition to the terms described below, the employment and severance agreements for each of our named executive officers include severance, termination and/or noncompetition provisions, which are described below under “Potential Paymentspayments upon Terminationtermination or Changechange in Controlcontrol at Fiscal 2018 Year-End”fiscal 2022 year-end” beginning on page 61.95. In 2022, we entered into employment agreements with Messrs. Bhalla and Jetley.
Rohit Kapoor
Mr. Kapoor serves as our Vice Chairman and CEO, and is based at our executive offices in New York, New York. Our engagement of Mr. Kapoor has been under the terms of employment agreements for over 1315 years. On September 19, 2017, weEffective as of August 3, 2020, the Company entered into ana second amended and restated employment agreement with Mr. Kapoor that became effective on January 1, 2018. That employment agreement(the “Kapoor Agreement”). The Kapoor Agreement provides for an initialemployment term from January 1, 2018that extends until December 31, 2020, and automatically renews for successive one-year periods unless terminated with 120 days prior’ notice.
Salary, Bonus and Equity.Mr. Kapoor’s termination or resignation.
Salary, bonus and equity
The Kapoor Agreement provides for a base salary increased to $720,000, effective April 1, 2018.of $750,000. Mr. Kapoor’s base salary can be increased at our sole discretion and cannot be decreased unless a Company-wide decrease in pay is implemented. Mr. Kapoor can earn an annual cash bonus, with a target of 150% of base salary and a maximum payout of 300%no greater than 310% of base salary, based upon the attainment of performance criteria determined by our Compensation and Talent Management Committee. Mr. Kapoor remains eligible to receive equity-based awards annually during the term, in amounts and forms determined by the Compensation and Talent Management Committee but with vesting terms no less favorable than ratable vesting over four years from the date of grant.his direct reports.
Personal benefits
Personal Benefits.We provide Mr. Kapoor with certain personal benefits, including certain club memberships, home office supplies, term life insurance policy (with a face value of $500,000), once-a-year business class airfare between the United States and India for the
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Executive compensation
executive and his family, up to $12,000$30,000 for personal tax and estate planning expenses, up to $1,400$2,067 per month car allowance, up to $12,000 per year for expenses associated with maintaining an automobile in India (including cost of a driver), personal security for the executive and his family while in India, reimbursement for first-class business travel, and a per diem allowance for certain trips. In addition, his employment agreement entitles him to certain other benefits in the event he is relocated to India, but which are not applicable currently as he maintains a U.S. residency.
Mr. Kapoor’s employment agreement also includes severance, termination and noncompetition provisions, which are described below under “Potential Paymentspayments upon Terminationtermination or Changechange in Controlcontrol at Fiscal 2018 Year-End”fiscal 2022 year-end” beginning on page 61.95.
Vishal ChhibbarMaurizio Nicolelli
Mr. ChhibbarNicolelli serves as our Executive Vice President and CFO and was based in India until December 31, 2015. We entered into an employment agreement with him, effective January 1, 2016 which will continue throughout Mr. Chhibbar’s employment with the Company.
Salary, Bonus and Equity. Mr. Chhibbar’s base salary was increased to $450,000, effective April 1, 2018. Mr. Chhibbar’s base salary will be reviewed at least annually and may be increased at the discretion of the Board. In addition, under his agreement, Mr. Chhibbar can earn an annual cash bonus, with a target of 75% of base salary and a maximum of 150% of base salary, based upon the attainment of performance criteria determined by our Compensation Committee. Mr. Chhibbar is also eligible, subject to performance and other conditions, to receive annual equity awards at the discretion of the Compensation Committee. Mr. Chhibbar was entitled to receive $100,000 in connection with his relocation from India to New York, New York in 2016.
Mr. Chhibbar’s employment agreement also includes severance, termination and noncompetition provisions which are described below under “Potential Payments upon Termination or Change in Control at Fiscal 2018 Year-End” beginning on page 61.
Pavan Bagai
Mr. Bagai serves as our President and Chief Operating Officer, and is based in India. We entered into an employment agreement with him, effective July 31, 2002 and a severance letter, effective March 15, 2011, each of which will continue throughout Mr. Bagai’s employment with the Company.
Salary, Bonus and Equity.Mr. Bagai’s annual fixed compensation, measured in U.S. dollars rather than his home currency of Indian rupees (using an exchange rate of63.87 INR to 1 USD, which was the exchange rate on December 31, 2017), was increased to $404,077 effective April 1, 2018. Mr. Bagai’s annual fixed compensation includes base salary, as well as amounts available as a leave travel allowance, a housing allowance, an automobile allowance, a medical allowance and a cash supplementary allowance. In addition, Mr. Bagai can earn an annual cash bonus, with a target of 75% of annual fixed compensation and a maximum of 150% of annual fixed compensation, based upon the attainment of performance criteria determined by our Compensation Committee. Mr. Bagai is also eligible, subject to performance and other conditions, to receive annual equity awards at the discretion of the Compensation Committee.
Mr. Bagai’s agreements also includes severance, termination and noncompetition provisions which are described below under “Potential Payments upon Termination or Change in Control at Fiscal 2018 Year-End” beginning on page 61.
Nagaraja Srivatsan
Mr. Srivatsan serves as our Executive Vice President and Chief Growth Officer, and is based at our executive offices in New York, New York. We entered into an employment agreement with him, effective December 10, 2016,February 3, 2020, which will continue throughout Mr. Srivatsan’sNicolelli’s employment with the Company. In connection with his appointment, Mr. Nicolelli received a joining bonus of $225,000, payable in two installments, and an initial grant of restricted stock units of the Company’s common stock with a fair market value of $425,000, which will vest in four equal, annual installments beginning on the first anniversary of the grant date.
Salary, bonus and equity
| Mr. Nicolelli’s base salary was set at $475,000 upon his hire in 2020 and is subject to review on an annual basis. In addition, Mr. Nicolelli can earn an annual cash bonus, with a target of 75% of base salary, based upon the attainment of performance criteria determined by our Compensation and Talent Management Committee. Mr. Nicolelli is also eligible, subject to performance and other conditions, to receive annual equity awards at the discretion of the Compensation and Talent Management Committee. |
Mr. Nicolelli’s agreement also includes severance, termination and noncompetition provisions, which are described below under “Potential payments upon termination or change in control at fiscal 2022 year-end” beginning on page 95.
Vikas Bhalla
Mr. Bhalla serves as our Executive Vice President and Business Head, Insurance, and is based in Delhi, India. We entered into an employment agreement with him, effective April 28, 2001 and a severance letter, effective March 15, 2011. In April 2022, we entered into an employment agreement with Mr. Bhalla that supersedes his prior agreements, and will continue throughout Mr. Bhalla’s employment with the Company.
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Executive compensation
Salary, Bonusbonus and Equity.equity
| Under his prior agreement, Mr. Bhalla’s annual fixed compensation, measured in his home currency of Indian rupees, was set at 1,659,382 Indian rupees when his employment agreement was first executed in 2001 and subject to review on an annual basis. Under his current agreement, the annual fixed compensation is set at 24,500,000 Indian Rupees and remains subject to review on an annual basis. Mr. Bhalla’s annual fixed compensation includes base salary, as well as amounts available as a leave travel allowance, a housing allowance, an automobile allowance, a medical allowance and a cash supplementary allowance. In addition, Mr. Bhalla can earn an annual cash bonus, with a target of 75% of annual fixed compensation, based upon the attainment of performance criteria determined by our Compensation and Talent Management Committee. Mr. Bhalla is also eligible, subject to performance and other conditions, to receive annual equity awards at the discretion of the Compensation and Talent Management Committee. |
Mr. Srivatsan’sBhalla’s agreements also includes severance, termination and noncompetition provisions, which are described below under “Potential payments upon termination or change in control at fiscal 2022 year-end” beginning on page 95.
Vivek Jetley
Mr. Jetley serves as our Executive Vice President and Business Head, Analytics, and is based at our executive offices in New York, New York. We entered into an employment agreement with him in April 2022, which will continue throughout Mr. Jetley’s employment with the Company.
Salary, bonus and equity
Mr. Jetley’s base salary increasedwas set at $420,000 and is subject to $450,000, effective April 1, 2018. Mr. Srivatsan’s base salary will be reviewed at least annually and may be increased at the discretion of the Board.review on an annual basis. In addition, under his agreement, Mr. SrivatsanJetley can earn an annual cash bonus, with a target of 75% of base salary, and a maximum of 150% of base salary, based upon the attainment of performance criteria determined by our Compensation and Talent Management Committee. Mr. SrivatsanJetley is also eligible, subject to performance and other conditions, to receive annual equity awards at the discretion of the Compensation Committee. Mr. Srivatsan’s employment agreement provided for: (i) an initial equity award of 18,000 restricted stock units in 2017 that vest according to the schedule described below under “Outstanding Equity Awards at Fiscal 2018 Year-End” beginning on page 59 and (ii) a one-time joining bonus in 2017 of $200,000.
Talent Management Committee.
Mr. Srivatsan’s employmentJetley’s agreement also includes severance, termination and noncompetition provisions, which are described below under “Potential Paymentspayments upon Terminationtermination or Changechange in Controlcontrol at Fiscal 2018 Year-End”fiscal 2022 year-end” beginning on page 61.95.
Nalin MiglaniAnkor Rai
Mr. Miglani servesRai served from October 2021 through April 2023 as our Executive Vice President and Chief Human ResourcesDigital Officer and iswas based at our executive offices in New York, New York. We entered into an employment agreement with him, effective DecemberNovember 1, 2014,2021, which will continuecontinued throughout Mr. Miglani’sRai’s employment with the Company.
Salary, Bonusbonus and Equity. Mr. Miglani’s base salary increased to $450,000, effective April 1, 2018 and may be further increased from time to time by our Board. While employed, Mr. Miglani can earn an annual cash bonus, with a target of 75% of base salary and a maximum of 150% of base salary, based upon attainment of performance criteria determined by our Compensation Committee. Mr. Miglani is also eligible, subject to performance and other conditions, to receive annual equity awards at the discretion of the Compensation Committee. Mr. Miglani’s employment agreement provided for: (i) an initial equity award of 20,000 restricted stock units that will vest according to the schedule described below under “Outstanding Equity Awards at Fiscal 2018 Year-End” beginning on page 59 and (ii) a one-time joining bonus of $200,000 half of which was paid on the commencement of his employment and the other half paid in March 2015, based on his continued service with the Company. Mr. Miglani received $100,000 in connection with his relocation from Amsterdam to New York in 2014.
| Mr. Rai’s base salary was set at $410,000 when his employment agreement was first executed in November 2021 and was subject to review on an annual basis. In addition, Mr. Rai could earn an annual cash bonus, with a target of 75% of base salary, based upon the attainment of performance criteria determined by our Compensation and Talent Management Committee. Mr. Rai was also eligible, subject to performance and other conditions, to receive annual equity awards at the discretion of the Compensation and Talent Management Committee. |
Mr. Miglani’s employment agreementRai’s agreements also includesincluded severance, termination and noncompetition provisions, which are described below under “Potential Paymentspayments upon Terminationtermination or Changechange in Controlcontrol at Fiscal 2018 Year-End”fiscal 2022 year-end” beginning on page 61.
Outstanding Equity Awards at Fiscal 2018 Year-End
The following table sets forth the equity awards we have made to our named executive officers that were outstanding as of December 31, 2018:
Option Awards | Stock Awards | ||||||||
Name | Option / | Number of | Number of | Option | Option | Number | Market | Equity | Equity |
| Rohit | 2/7/2012 | 47,500 | — | 24.77 | 2/7/2022 | ||||
| Kapoor | 2/26/2015 | 9,375(a) | 493,313 | ||||||
| 2/24/2016 | 18,750(a) | 986,625 | |||||||
| 2/23/2017 | 23,917(a) | 1,258,513 | |||||||
| 2/23/2017 | 31,890(c) | 1,678,052 | |||||||
| 2/23/2017 | 31,888(d) | 1,677,947 | |||||||
| 2/22/2018 | 30,005(a) | 1,578,863 | |||||||
| 2/22/2018 | 15,003(e) | 789,458 | |||||||
| 2/22/2018 | 15,002(e) | 789,405 | |||||||
| Vishal | 6/1/2009 | 33,000 | — | 9.59 | 6/1/2019 | ||||
| Chhibbar | 2/26/2015 | 3,000(b) | 157,860 | ||||||
| 2/24/2016 | 3,500(a) | 184,170 | |||||||
| 2/23/2017 | 5,457(a) | 287,147 | |||||||
| 2/23/2017 | 7,276(c) | 382,863 | |||||||
| 2/23/2017 | 7,274(d) | 382,758 | |||||||
| 2/22/2018 | 7,350(a) | 386,757 | |||||||
| 2/22/2018 | 3,675(e) | 193,379 | |||||||
| 2/22/2018 | 3,675(e) | 193,379 | |||||||
| Pavan | 2/26/2015 | 5,000(b) | 263,100 | ||||||
| Bagai | 2/24/2016 | 6,250(a) | 328,875 | ||||||
| 2/23/2017 | 8,625(a) | 453,848 | |||||||
| 2/23/2017 | 11,500(c) | 605,130 | |||||||
| 2/23/2017 | 11,500(d) | 605,130 | |||||||
| 2/22/2018 | 10,600(a) | 557,772 | |||||||
| 2/22/2018 | 5,300(e) | 278,886 | |||||||
| 2/22/2018 | 5,300(e) | 278,886 | |||||||
| Nagaraja | 12/15/2016 | 9,000(a) | 473,580 | ||||||
| Srivatsan | 2/23/2017 | 4,950(a) | 260,469 | ||||||
| 2/23/2017 | 6,600(c) | 347,292 | |||||||
| 2/23/2017 | 6,600(d) | 347,292 | |||||||
| 2/22/2018 | 5,960(a) | 313,615 | |||||||
| 2/22/2018 | 2,980(e) | 156,808 | |||||||
| 2/22/2018 | 2,980(e) | 156,808 | |||||||
| Nalin | 2/26/2015 | 2,400(b) | 126,288 | ||||||
| Miglani | 2/24/2016 | 3,000(a) | 157,860 | ||||||
| 2/23/2017 | 5,363(a) | 282,201 | |||||||
| 2/23/2017 | 7,150(c) | 376,233 | |||||||
| 2/23/2017 | 7,150(d) | 376,233 | |||||||
| 2/22/2018 | 6.410(a) | 337,294 | |||||||
| 2/22/2018 | 3,205(e) | 168,647 | |||||||
| 2/22/2018 | 3,205(e) | 168,647 | |||||||
95.
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Executive compensation
Outstanding equity awards at fiscal 2022 year-end
| Name | Stock award grant date | Number of shares or units of stock that (#)(1) | Market value of shares or units of stock that have | Equity incentive plan awards: number of unearned shares, units or other rights that have not vested (#)(3) | Equity incentive plan awards: market or payout value of unearned shares, | |||||||||||||||
Rohit Kapoor | ||||||||||||||||||||
| 2/20/2019 | 7,228 | 1,224,640 | ||||||||||||||||||
| 2/20/2020 | 11,760 | 1,992,497 | ||||||||||||||||||
| 2/17/2021 | 26,550 | 4,498,367 | ||||||||||||||||||
| 2/17/2021 | 70,800(a) | 11,995,644 | ||||||||||||||||||
| 2/16/2022 | 25,164 | 4,263,537 | ||||||||||||||||||
| 2/16/2022 | 15,099(b) | 2,558,224 | ||||||||||||||||||
| 2/16/2022 | 22,647(c) | 3,837,081 | ||||||||||||||||||
Maurizio Nicolelli | 2/3/2020 | 2,949 | 499,649 | |||||||||||||||||
| 2/19/2020 | 2,183 | 369,866 | ||||||||||||||||||
| 2/17/2021 | 5,190 | 879,342 | ||||||||||||||||||
| 2/17/2021 | 13,840(a) | 2,344,911 | ||||||||||||||||||
| 9/1/2021 | 8,121(2) | 1,375,941 | ||||||||||||||||||
| 2/16/2022 | 3,884 | 658,066 | ||||||||||||||||||
| 2/16/2022 | 2,331(b) | 394,941 | ||||||||||||||||||
| 2/16/2022 | 3,495(c) | 592,158 | ||||||||||||||||||
| 3/31/2022 | 4,177(2) | 707,709 | ||||||||||||||||||
Vikas Bhalla | 2/20/2019 | 1,708 | 289,386 | |||||||||||||||||
| 2/19/2020 | 4,150 | 703,135 | ||||||||||||||||||
| 2/17/2021 | 5,505 | 932,712 | ||||||||||||||||||
| 2/17/2021 | 14,680(a) | 2,487,232 | ||||||||||||||||||
| 9/1/2021 | 12,181(2) | 2,063,827 | ||||||||||||||||||
| 2/16/2022 | 4,348 | 736,682 | ||||||||||||||||||
| 2/16/2022 | 2,609(b) | 442,043 | ||||||||||||||||||
| 2/16/2022 | 3,913(c) | 662,980 | ||||||||||||||||||
| 3/31/2022 | 4,177(2) | 707,709 | ||||||||||||||||||
Vivek Jetley | 2/20/2019 | 723 | 122,498 | |||||||||||||||||
| 2/19/2020 | 2,183 | 369,866 | ||||||||||||||||||
| 2/17/2021 | 4,467 | 756,844 | ||||||||||||||||||
| 2/17/2021 | 11,910(a) | 2,017,911 | ||||||||||||||||||
| 9/1/2021 | 12,181(2) | 2,063,827 | ||||||||||||||||||
| 2/16/2022 | 4,040 | 684,497 | ||||||||||||||||||
| 2/16/2022 | 2,424(b) | 410,698 | ||||||||||||||||||
| 2/16/2022 | 3,636(c) | 616,047 | ||||||||||||||||||
| 3/31/2022 | 4,177(2) | 707,709 | ||||||||||||||||||
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Executive compensation
| Name | Stock award grant date | Number of shares or units of stock that (#)(1) | Market value of shares or units of stock that have | Equity incentive plan awards: number of unearned shares, units or other rights that have not vested (#)(3) | Equity incentive plan awards: market or payout value of unearned shares, | |||||||||||||||
Ankor Rai | 2/20/2019 | 672 | 113,857 | |||||||||||||||||
| 2/19/2020 | 1,680 | 284,642 | ||||||||||||||||||
| 2/17/2021 | 2,880 | 487,958 | ||||||||||||||||||
| 2/17/2021 | 7,680(a) | 1,301,222 | ||||||||||||||||||
| 9/1/2021 | 12,181(2) | 2,063,827 | ||||||||||||||||||
| 2/16/2022 | 3,108 | 526,588 | ||||||||||||||||||
| 2/16/2022 | 1,865(b) | 315,987 | ||||||||||||||||||
| 2/16/2022 | 2,797(c) | 473,896 | ||||||||||||||||||
| 3/31/2022 | 4,177(2) | 707,709 | ||||||||||||||||||
(1) Unless otherwise noted, this column represents annual restricted stock unit awards that vest and convert to shares in accordance with the following schedule (subject to continued employment through each applicable vesting date): 25% of the restricted stock units vest on each of the first, second, third and fourth anniversaries of the grant date.
(2) These restricted stock unit awards vest and convert to shares in accordance with the following schedule (subject to continued employment through each applicable vesting date): 1/3 of the restricted stock units vest on the second anniversary of the grant date with the remaining 2/3 vesting on the third anniversary of the grant date.
(3) The performance restricted stock unit awards in this table vest and convert to shares in accordance with the following schedules (subject to continued employment through the applicable vesting date and achievement of applicable performance goals):
(a) 100% of the restricted stock units vest on December 31, 2023. This amount represents the 2021 Relative TSR-Linked PRSUs and reflects maximum performance.
(b) 100% of the restricted stock units vest on December 31, 2024. This amount represents the 2022 Revenue-Linked PRSUs and reflects target performance.
(c) 100% of the restricted stock units vest on December 31, 2024. This amount represents the 2022 Relative TSR-Linked PRSUs and reflects target performance.
(4) The price used in determining the market values set forth in this table is $169.43, which was the closing price of our stock on December 30, 2022.
Option Exercisesexercises and Stock Vested During Fiscal Year 2018
stock vested during fiscal year 2022
The following table provides additional information about the value realized by our named executive officers on option award exercises and stock award vesting during fiscal year 2018:2022:
Option Awards | Stock Awards | |||
Name | Number of Shares | Value Realized | Number of Shares | Value Realized on |
| Rohit Kapoor | — | — | 49,877 | 2,960,150 |
| Vishal Chhibbar | 9,000 | 470,850 | 11,190 | 663,948 |
| Pavan Bagai | — | — | 18,944 | 1,123,512 |
| Nagaraja Srivatsan | — | — | 6,150 | 347,969 |
| Nalin Miglani | — | — | 15,292 | 900,960 |
| Option awards | Stock awards | |||||||
| Name | Number of shares acquired on exercise | Value realized on ($) | Number of shares acquired on vesting | Value realized on ($) | ||||
Rohit Kapoor | — | — | 93,449 | 14,288,566 | ||||
Maurizio Nicolelli | — | — | 10,843 | 1,624,495 | ||||
Vikas Bhalla | — | — | 19,731 | 2,957,319 | ||||
Vivek Jetley | — | — | 15,005 | 2,314,952 | ||||
Ankor Rai | — | — | 12,615 | 1,955,042 | ||||
| 94 | / | EXL 2023 Proxy Statement |
Executive compensation
Pension Benefits For Fiscal Year 2018
benefits for fiscal year 2022
The following table discloses the present value of accumulated pension benefits payable to each of the named executive officers andofficers.
| Name | Plan name | Number of years credited service (#)(1) | Present value of accumulated benefit ($) | Payments during last fiscal year ($) | ||||
Vikas Bhalla | Gratuity Plan for Indian Employees(2) | 22 | 124,859 | — | ||||
(1) Consists of the number of years of service credited to each named executive under the Gratuity Plan for Indian Employees as of December 31, 2018:2022, for the purpose of determining benefit service under the Gratuity Plan. Credited service is determined based on the completed years of continuous employment (rounded to the nearest whole number of years) with the Company since the executive’s date of hire.
Name | Plan Name | Number of Years | Present Value | Payments During |
| Pavan Bagai | Gratuity Plan for Indian Employees(2) | 16 | 100,330 |
(2) Liabilities with regard to the Gratuity Plan is determined by actuarial valuation using the projected unit credit method. Under this method, we determine our liability based upon the discounted value of salary increases until the date of separation arising from retirement, death, resignation or other termination of services. Critical assumptions used in measuring the plan expense and projected liability under the projected unit credit method include the discount rate, expected return on assets and the expected increase in the compensation rates. Details regarding the assumptions used in the calculation of these amounts are included in footnote 20 to the audited financial statements for the fiscal year ended December 31, 2022, included in the 2022 Form 10-K.
We are required to provide all Indian employees with benefits under the Gratuity Plan, a defined benefit pension plan in India. Distributions from the Gratuity Plan are made in a single lump sum following retirement from the Company. An executive’s benefit under the Gratuity Plan is determined at any time as the executive’s annual base salary (determined based on the executive’s most recent monthly base salary) divided by 26, multiplied by 15, and the product multiplied by the executive’s completed years of continuous service with the Company. An executive has a vested and nonforfeitable right to payment of his accrued Gratuity Plan benefit only after five years of service. The present value of Mr. Bagai’sBhalla’s accumulated benefits has been determined based on his monthly basic salary ratesrate in effect on December 31, 2018,2022, which iswas approximately $10,869.
$9,837.
Potential Paymentspayments upon Terminationtermination or Changechange in Controlcontrol at Fiscal 2018 Year-End
fiscal 2022 year-end
The following tables summarize the amounts payable to each named executive officer upon a change in control or termination of his employment with us on December 31, 2018.2022. In calculating potential payments for purposes of this disclosure, we have quantified our equity-based payments using the closing stock price on December 31, 2018,30, 2022, which was $52.62. Certain defined$169.43. Some of the capitalized terms used in the employment agreements for our named executive officers are defined followingin the description of Mr. Miglani’s potential payments.section entitled “Certain defined terms” on page 102.
Rohit Kapoor
Cash Severance.severance
If Mr. Kapoor’s employment were terminated by us without “cause” or by the executive for “good reason” or by “retirement” (in each case, as described below) on December 31, 2018,2022, he would have been entitled to cash severance consisting of:
Strategic insight and broad business perspective
