DEF 14A 1 d101835ddef14a.htm DEFINITIVE PROXY STATEMENT Definitive Proxy Statement
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE

SECURITIES EXCHANGE ACT OF 1934

 

 

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x   Definitive Proxy Statement
¨   Definitive Additional Materials
¨   Soliciting Material Pursuant to § 240.14a-12

MetLife, Inc.

(Name of Registrant as Specified In Its Charter)

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LOGO

MetLife, Inc.

200 Park Avenue, New York, NY 10166

April 26, 2016

Dear Shareholder:

You are invited to attend MetLife, Inc.’s 2016 annual meeting of shareholders, which will be held on Tuesday, June 14, 2016 beginning at 11:30 a.m., Eastern Time, at 1095 Avenue of the Americas, New York, New York.

At the meeting you will vote on a number of important matters described in the attached Proxy Statement. You will also act on such other matters as may properly come before the meeting.

The vote of every shareholder is important. You can ensure that your shares will be represented and voted at the meeting by voting online or by telephone or by signing and returning a proxy card. Detailed instructions on how to vote on the Internet or by telephone may be found in the attached Proxy Statement on page 2. If you received printed proxy materials and choose to vote by mail, you may use the postage-paid, pre-addressed envelope provided with the materials.

Sincerely yours,

LOGO

Steven A. Kandarian

Chairman of the Board,

President and Chief Executive Officer


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LOGO

MetLife, Inc.

200 Park Avenue, New York, NY 10166

 

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

The 2016 annual meeting of the shareholders of MetLife, Inc. will be held at 1095 Avenue of the Americas, New York, New York on Tuesday, June 14, 2016 at 11:30 a.m., Eastern Time. At the meeting, shareholders will consider and vote on the following matters:

  1. the election of 12 Directors, each for a one-year term;  
  2. an advisory (nonbinding) vote on an exclusive forum By-Law;  
  3. the ratification of the appointment of Deloitte & Touche LLP as MetLife, Inc.’s independent auditor for 2016;  
  4. an advisory (non-binding) vote to approve the compensation paid to MetLife, Inc.’s Named Executive Officers;  
  5. a shareholder proposal regarding independent Chairman, if properly presented at the meeting;  
  6. a shareholder proposal regarding action by written consent, if properly presented at the meeting; and  
  7. such other matters as may properly come before the meeting.  

Information about the matters to be acted upon at the meeting is contained in the accompanying Proxy Statement.

Shareholders of record of MetLife, Inc. common stock at the close of business on April 19, 2016 will be entitled to vote at the meeting or any adjournment or postponement thereof.

By Order of the Board of Directors,

 

LOGO

Timothy J. Ring

Senior Vice President and Secretary

New York, New York

April 26, 2016

 

 

Important Notice Regarding the Availability of Proxy Materials for the

Shareholder Meeting to be Held on June 14, 2016

The accompanying Proxy Statement, the MetLife, Inc. 2015 Annual Report to Shareholders, the Chairman’s Letter, and directions to the location of the 2016 annual meeting of shareholders are available at http://investor.metlife.com by selecting the appropriate link under “Related Links.”


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PROXY STATEMENT

 

This Proxy Statement contains information about the 2016 annual meeting of shareholders (Annual Meeting) of MetLife, Inc. (MetLife or the Company). We are providing proxy materials to solicit proxies on behalf of the MetLife Board of Directors. We are sending certain of our shareholders a Notice of Internet Availability of Proxy Materials (Notice) on or about April 26, 2016. The Notice includes instructions on how to access our Proxy Statement, 2015 Annual Report, and Chairman’s Letter online. Shareholders who have previously requested a printed or electronic copy of the proxy materials will continue to receive such a copy of the proxy materials, which will be sent on or about April 26, 2016. Please see “Accessing your proxy materials” on page 99 for additional information.

 

 

 

PROXY SUMMARY

     2   
PROPOSAL 1 – Election of Directors for a
One-Year Term Ending at the 2017 Annual
Meeting of Shareholders
     11   

Director Nominees

     11   

Corporate Governance

     24   

Director Compensation in 2015

     34   

PROPOSAL 2 – Advisory Vote on Exclusive
Forum By-Law

     37   
PROPOSAL 3 – Ratification of Appointment of the Independent Auditor      38   

Independent Auditor’s Fees for 2015 and 2014

     39   

Audit Committee Report

     39   
PROPOSAL 4 – Advisory Vote to Approve the Compensation Paid to the Company’s Named Executive Officers      41   

Compensation Committee Report

     41   

Compensation Discussion and Analysis

     42   

Summary Compensation Table

     69   

Grants of Plan-Based Awards in 2015

     75   
Outstanding Equity Awards at 2015 Fiscal Year-End      77   

Option Exercises and Stock Vested in 2015

     80   

Pension Benefits at 2015 Fiscal Year-End

     82   
Nonqualified Deferred Compensation at 2015 Fiscal Year-End      85   
Potential Payments upon Termination or
Change-in-Control at 2015 Fiscal Year-End
     90   

 

Cover image:

MetLife’s principal executive

offices, 200 Park Avenue in

New York City.

 

 

 

 

MetLife 2016 Proxy Statement    

 

 

 

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LOGO     

      Proxy Summary

 

PROXY SUMMARY

 

This summary provides highlights of information contained elsewhere in this Proxy Statement and does not contain all of the information that you should consider. Please read the entire Proxy Statement carefully before voting.

 

 

Voting Your Shares

 

Record date

      April 19, 2016
 

Voting

      Shareholders as of the record date are entitled to vote. Each share of MetLife common stock (a Share) is entitled to one vote for each Director nominee and one vote for each of the other proposals.

Your vote is important. Shareholders of record may vote their Shares in person at the Annual Meeting or by using any of the following methods. Beneficial owners whose Shares are held at a brokerage firm or by a bank or other nominee should follow the voting instructions received from such nominee. Participants in retirement and savings plans should refer to voting instructions on page 100.

 

             
LOGO        LOGO        LOGO
Internet        Telephone        Mail

www.investorvote.com/MET no later than

11:59 p.m. Eastern Time, June 13, 2016.

      

1-800-652-8683 until 11:59 p.m.,

Eastern Time, June 13, 2016.

      

Complete, sign and return your proxy card by
mail (if you received printed copies of the proxy

materials) so that it is received by MetLife c/o

Computershare prior to the Annual Meeting.

             

Proposals for Your Vote

 

                                             
    Proposal          

 

Directors’ Recommendation

 

                  Vote Required                  

 

Page
    Reference    

 

   
                     
 

Proposal 1

Election of 12 Directors to one-year terms

      FOR each nominee       Majority of Shares voted       11  
 

Proposal 2

Advisory vote on exclusive forum By-Law

      FOR      

Majority of Shares voted

      37  
 

Proposal 3

Ratification of appointment of Deloitte & Touche LLP
as MetLife’s independent auditor for 2016

      FOR       Majority of Shares voted       38  
 

Proposal 4

Advisory vote to approve compensation paid to the Named Executive Officers

      FOR       Majority of Shares voted       41  
 

Proposal 5

Shareholder proposal regarding independent Chairman

      AGAINST       Majority of Shares voted       105  
 

Proposal 6

Shareholder proposal regarding action by written consent

      AGAINST       Majority of Shares voted       107  
                                             

 

 

 

 

 

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    MetLife 2016 Proxy Statement

 


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Proxy Summary      

 

     LOGO

 

Company Performance

The Company has taken, and continues to take, numerous actions to maximize shareholder value:

•  Bold moves to accelerate value

•  Enterprise-wide focus on Free Cash Flow

•  Material increase in capital return to shareholders

Bold Moves to Accelerate Value

In 2015, the Company took action to accelerate value.

MetLife’s Accelerating Value initiative entails a strategic focus on customers, competitors and markets, and cash. The Company is committed to fully analyzing the cash and capital characteristics of the business at a granular level and taking action based on that analysis in order to maximize shareholder value over time.

Informed by its strategy and the regulatory environment:

•  the Company is planning to separate a substantial portion of its U.S. Retail segment, producing capital relief; and

•  the Company has reached agreement to divest the captive agency distribution channel, which will generate savings.

As a result, any new, separate U.S. Retail company would have the opportunity to compete more effectively and generate stronger returns for shareholders, benefiting from greater focus, more flexibility, and a reduced compliance and capital burden.

In addition, the Company’s efforts, beginning in 2015, persuaded a U.S. District Court to rescind the Financial Stability Oversight Council’s (FSOC) designation of MetLife as a Systematically Important Financial Institution. This result is consistent with the Company’s view that its business model does not pose a threat to the financial stability of the United States. The FSOC has filed an appeal of the District Court ruling.

 

 

MetLife 2016 Proxy Statement    

 

 

 

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LOGO     

      Proxy Summary

 

Focus on Free Cash Flow

MetLife’s level of Free Cash Flow generation is the most important business metric in determining the Company’s ability to return capital to shareholders. Over time, the performance of life insurance stocks has become more closely correlated with the ratio of Free Cash Flow to Operating Earnings. Growing Free Cash Flow by investing capital at attractive risk-adjusted returns will be the surest way to maximize shareholder value over time. That is why Free Cash Flow generation has become an enterprise-wide imperative at MetLife and has informed all of our major business decisions and will continue to do so in the months and years ahead.

(The following performance measures are not calculated based on accounting principles generally accepted in the United States of America (GAAP). They should be read in conjunction with Appendix A to this Proxy Statement, which includes non-GAAP financial information, definitions, and/or reconciliations to the most directly comparable measures that are based on GAAP.)

 

Free Cash Flow as a Percentage of Operating Earnings

LOGO

 

 

 

 

 

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    MetLife 2016 Proxy Statement

 


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Proxy Summary      

 

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Capital Return to Shareholders

MetLife’s philosophy is that excess capital belongs to shareholders. The Company’s total shareholder distributions are part of its prudent capital management strategy.

(The following performance measures are not calculated based on GAAP. They should be read in conjunction with Appendix A to this Proxy Statement, which includes non-GAAP financial information, definitions, and/or reconciliations to the most directly comparable measures that are based on GAAP.)

 

Total Shareholder Distributions1 ($ in billions)

 

LOGO

 

 

MetLife 2016 Proxy Statement    

 

 

 

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LOGO     

      Proxy Summary

 

Executive Pay for Performance

The Company maintained its pay for performance practices in 2015. Most of the Company’s Executive Officers’ Total Compensation for 2015 performance was variable and depended on performance. In addition, the Compensation Committee allocated a greater portion of variable compensation to stock-based long-term incentives than to annual cash incentives. These long-term incentives align executive and shareholder interests and encourage future contributions to performance. Ultimately, the value of long-term incentives depends on future Company performance and stock price performance.

 

Chief Executive Officer Compensation

for 2015 Performance

LOGO

Other Executive Group Members’

Compensation for 2015 Performance as a Whole

 

LOGO

 

For more information, see the Compensation Discussion and Analysis beginning on page 42.

 

 

 

 

 

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    MetLife 2016 Proxy Statement

 


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Proxy Summary      

 

     LOGO

 

Track Record of Best Practices in Corporate Governance

The Company has a proven track record of best practices in corporate governance.

 

                          
            
 

Independent Lead Director

 

         ü

 

 
 

Independent Board Committees

 

         ü

 

 
 

World-Class, Experienced Board

 

         ü

 

 
 

Annually Elected Directors

 

         ü

 

 
 

Comprehensive Annual Board and Committee Assessment Process

 

         ü

 

 
 

Majority Vote Standard

 

         ü

 

 
 

No “Poison Pill”

 

         ü

 

 
 

Publicly Disclosed Political Contributions

 

         ü

 

 
 

Share Ownership Guidelines for Executives and Directors

 

         ü

 

 
 

Policy Prohibiting Hedging or Pledging Company Securities

 

         ü

 

 
 

Performance-Based Compensation Recoupment Policy

 

         ü

 

 
 

Shareholder Proxy Access

 

         ü

 

 
 

Shareholder Right to Call Special Meeting

 

         ü             

 

 

Say-on-Pay Vote Results

 

    2015       98%  
    2014       97%  
    2013       93%  

Shareholder feedback, including the outcome of say-on-pay vote results, continues to inform compensation decisions.

Board Oversight of Risk Management

The Company’s Board of Directors has active and robust practices in oversight of risk management:

 

  Finance and Risk Committee oversees assessment, management, and mitigation of material risks, as well as capital and liquidity management practices.

 

  Other committees also have significant risk management oversight:

 

  ü Audit: legal and regulatory compliance and internal controls;

 

  ü Governance and Corporate Responsibility: ethics, compliance programs and sales practices;

 

  ü Investment: investment portfolio risks; and

 

  ü Compensation: compensation plan risks, e.g. avoiding incentives to take excessive risk.

 

 

MetLife 2016 Proxy Statement    

 

 

 

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LOGO     

      Proxy Summary

 

Director Nominees

The Company has highly-qualified, independent leaders on its Board of Directors.

 

                  
 

Board  

Independence  

    

 

  Independent Lead Director

 

  11 of 12 directors are independent

 

  All Board committees composed entirely of Independent Directors (except Executive Committee)

 
        
                

 

 

Leadership  

Experience  

    

 

  Directors include current or former chief executive officers, chief operating officers, chief financial officers, presidents, and directors of other world-class public companies, including American Express, Campbell Soup Company, Gillette, Kellogg, NYSE, and Pfizer

 

  10 of 11 Independent Directors have served on other public company boards

 
        
                

 

 

Financial Services and  

Investment Experience  

    

 

  Board comprised of directors with current and former leadership positions at leading financial institutions, including American Express, Carlyle Group, Citigroup, and Visa

 
        
                

 

 

Ongoing Board  

Refreshment and Diversity  

    

 

  4 new directors since 2013

 

  Directors come from various industries and bring diverse experience

 

  One-third of directors, including the Lead Director who is also Chair of the Governance and Corporate Responsibility Committee, are women

 
                  

 

 

 

 

 

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    MetLife 2016 Proxy Statement

 


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Proxy Summary      

 

     LOGO

 

The following table provides summary information about each Director nominee.

 

                                                                                                         
                                           

Current Committee Membership

 

   
    Nominee        

 

Experience and

Qualifications Highlights

 

         

 

Independent

 

          Audit           Compensation           Executive           Finance and Risk           Governance and
  Corporate Responsibility  
          Investment    
                                             
 

Cheryl W. Grisé

Lead Director

Former Executive Vice President,

Northeast Utilities

     

- Corporate Governance

- Executive Leadership

- Global Business Experience

- Business Operations

      Û       Û       Û       Û             CHAIR        
               
 

Carlos M. Gutierrez

Co-Chair, The Albright Stonebridge Group

     

- Executive Leadership

- Global Business Experience

- Business Operations

- Government Service

- Public Policy

- Civic Leadership

 

      Û                               Û       Û  
               
 

R. Glenn Hubbard, Ph.D.

Dean and Russell L. Carson

Professor of Economics and Finance, Graduate School of Business, Columbia University

     

- Public Policy

- Academic Experience

- Investments

- Civic Leadership

- Executive Leadership

 

      Û                   Û       Û             CHAIR  
               
 

Steven A. Kandarian

Chairman of the Board, President and Chief Executive Officer, MetLife, Inc.

     

- Knowledge of MetLife’s

  Business and Operations

- Executive Leadership

- Global Business Experience

- Business Operations

 

                        CHAIR                    
               
 

Alfred F. Kelly, Jr.

President and Chief Executive Officer, Intersection

     

- Executive Leadership

- Global Business Experience

- Business Operations

 

      Û       Û       Û       Û       CHAIR              
               
 

Edward J. Kelly, III

Former Chairman, Institutional Clients Group, Citigroup Inc.

     

- Executive Leadership

- Global Business Experience

- Financial Expertise

- Business Operations

 

      Û       Û                   Û              
                                                                                                         

 

 

MetLife 2016 Proxy Statement    

 

 

 

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LOGO     

      Proxy Summary

 

 

                                                                                                                 
                                                  

Current Committee Membership

 

       
        Nominee          

 

Experience and

Qualifications Highlights

 

           

 

Independent  

 

          Audit           Compensation           Executive           Finance and Risk           Governance and
  Corporate Responsibility  
          Investment        
                                                   

 

               
   

William E. Kennard

Former U.S. Ambassador to the European Union

     

- Government Service

- Public Policy

- Global Business Experience

- Business Operations

- Investments

- Corporate Governance

 

      Û                         Û             Û    
               
   

James M. Kilts

Founding Partner, Centerview Capital

     

- Executive Leadership

- Global Business Experience

- Business Operations

- Investments

 

      Û             CHAIR       Û                   Û    
               
   

Catherine R. Kinney

Former President and Co-Chief Operating Officer, New York Stock Exchange, Inc.

     

- Corporate Governance

- Executive Leadership

- Global Business Experience

- Business Operations

 

      Û       Û                   Û                
               
   

Denise M. Morrison

President and Chief Executive Officer, Campbell Soup Company

     

- Executive Leadership

- Global Business Experience

- Business Operations

- Civic Leadership

 

      Û             Û                   Û          
               
   

Kenton J. Sicchitano

Former Global Managing Director, PricewaterhouseCoopers LLP

     

- Accounting / Auditing

- Tax and Financial Advisory

- Executive Leadership

- Global Business Experience

- Risk Management

 

      Û       CHAIR       Û       Û       Û                
               
   

Lulu C. Wang

Founder and Chief Executive Officer, Tupelo Capital Management LLC

     

- Investments

- Executive Leadership

- Global Business Experience

- Business Operations

- Civic Leadership

 

      Û                               Û       Û    
                                                                                                                 

 

 

 

 

 

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    MetLife 2016 Proxy Statement

 


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PROPOSAL 1 — Election of Directors for a One-Year Term Ending at the 2017 Annual Meeting of Shareholders

       

 

     LOGO

 

PROPOSAL 1 — ELECTION OF DIRECTORS FOR A ONE-YEAR TERM ENDING AT THE 2017 ANNUAL MEETING OF SHAREHOLDERS

 

 

LOGO        The Board of Directors recommends that you vote FOR the election of each of the Director nominees.

 

Director Nominees

The Company’s success and long-term value depend on the judgment, initiative, and efforts of its Directors. As a Board, these individuals oversee MetLife’s business policies and strategies. They also oversee the Chief Executive Officer and the other most senior executives of the Company (Executive Officers or Executive Group) in their management of the Company’s business.

The Board of Directors currently has 12 members. Each of the Director nominees is currently serving as a Director of MetLife and has agreed to continue to serve if elected. The Board of Directors has no reason to believe that any nominee would be unable to serve if elected; however, if for any reason a nominee should become unable to serve at or before the Annual Meeting,

the Board could reduce the size of the Board or nominate a replacement candidate for election. If you granted a proxy to vote your Shares, the individuals who have your proxy could use their discretion to vote for a replacement candidate nominated by the Board. The proxies will not have authority to vote for a greater number of nominees than the number of nominees named on the proxy card.

Each of the Director nominees is also currently serving as a director of Metropolitan Life Insurance Company (MLIC), a direct, wholly-owned subsidiary of MetLife with a class of securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended (the Exchange Act), in connection with the issuance of certain insurance products. The common stock of MLIC is not publicly traded.

 

 

 

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LOGO     

      Director Nominees

 

 

     LOGO     

 

 

Cheryl W. Grisé

age 63, Former Executive Vice President, Northeast Utilities

 

 

Lead Director

Director since 2004

Ms. Grisé’s experience as the chief executive officer of a major enterprise subject to complex regulations has provided her with a substantive understanding of the challenges of managing a highly regulated company such as MetLife. With her executive experience and her experience as a general counsel and corporate secretary, Ms. Grisé brings a unique perspective on the Board’s responsibility for overseeing the management of a regulated enterprise and with respect to the effective functioning of the Company’s corporate governance structures.

 

 

LOGO Professional Highlights:

 

  Northeast Utilities, a public utility holding company engaged in the distribution of electricity and natural gas (1980 – 2007)
    Executive Vice President (December 2005 – July 2007)
    Chief Executive Officer of principal operating subsidiaries (September 2002 – January 2007)
    President, Utility Group, Northeast Utilities Service Company (May 2001 – January 2007)
    President, Utility Group (May 2001 – December 2005)
    Senior Vice President, Secretary and General Counsel (1998 – 2001)

LOGO Other Professional and Leadership Experience:

 

  Trustee Emeritus, University of Connecticut Foundation
  Senior Fellow, American Leadership Forum
  Other public company directorships: PulteGroup, Inc.; ICF International
  Prior public company directorships (past five years): Pall Corporation

LOGO Education:

 

  B.A., University of North Carolina at Chapel Hill
  J.D., Thomas Jefferson School of Law
  Executive Management Program, Yale University School of Organization and Management
 

 

 

 

 

 

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    MetLife 2016 Proxy Statement

 


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Director Nominees      

 

     LOGO

 

 

     LOGO     

 

 

Carlos M. Gutierrez

age 62, Co-Chair, The Albright Stonebridge Group

 

 

Director since 2013

As Chairman and Chief Executive Officer of Kellogg, Secretary Gutierrez gained deep insight into the complex challenges of guiding a large enterprise in a competitive global economy. As Secretary of Commerce, he worked with government and business leaders to promote America’s economic interests. Secretary Gutierrez’s unique mix of experience gives him a valuable perspective and ability to oversee management’s efforts to grow and develop MetLife’s global business and its interactions with domestic and foreign governments and regulators.

 

 

LOGO Professional Highlights:

 

  The Albright Stonebridge Group, a consulting firm (April 2013 – present)
    Co-Chair (February 2014 – Present)
    Vice Chair (April 2013 – February 2014)
  Vice Chairman, Institutional Client Group, Citigroup Inc., a financial services corporation (January 2011 – February 2013)
  Chairman and Founding Consultant of Global Political Strategies, a division of APCO Worldwide, Inc., a consulting firm (2010 – 2011)
  Secretary of Commerce of the United States (February 2005 –January 2009)
  Kellogg Company, a manufacturer of packaged food products (1975 – 2005)
    Chairman and Chief Executive Officer (2003 – 2005)
    Chairman, President and Chief Executive Officer (2000 – 2003)
    President and Chief Executive Officer (1999 – 2000)
    President and Chief Operating Officer (1998 – 1999)

LOGO Other Professional and Leadership Experience:

 

  Chairman, Republicans for Immigration Reform, a political action committee
  Member, Board of Directors, U.S.-Mexico Foundation
  Chairman, Board of Trustees, Meridian International Center
  Co-founder, TheDream.US
  National Member, Board of Trustees, University of Miami
  Member, Board of Directors, Viridis Learning, Inc.
  Co-Chair, Regional Migration Study Group
  Other public company directorships: Occidental Petroleum Corporation; Time Warner, Inc.

LOGO Education:

 

  Instituto Tecnologico y de Estudios Superiores de Monterrey, Business Administration Studies
 

 

 

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R. Glenn Hubbard, Ph.D.

age 57, Dean and Russell L. Carson Professor of Economics and Finance, Graduate School of Business, Columbia University

 

 

Director since 2007

As an economic policy advisor to the highest levels of government and financial regulatory bodies, Dr. Hubbard has an unparalleled understanding of global economic conditions and emergent regulations and economic policies. This expertise contributes to the Board’s understanding of how shifting economic conditions and developing regulations and economic policies may impact MetLife’s investments, businesses, and operations worldwide.

 

 

LOGO Professional Highlights:

 

  Columbia University
    Dean, Graduate School of Business (2004 – Present)
    Russell L. Carson Professor of Economics and Finance, Graduate School of Business (1994 – Present)
    Professor of Economics, Faculty of Arts and Sciences (1997 – Present)
  Co-Chair, Committee on Capital Markets Regulation, an independent nonprofit research organization (2006 – Present)
  Chairman, President’s Council of Economic Advisers, an agency within the Executive Office of the President of the United States (2001 – 2003)
  Chairman of the Economic Policy Committee, Organization for Economic Cooperation and Development, an international economic and trade organization (2001 – 2003)
  Deputy Assistant Secretary for Tax Policy, United States Department of the Treasury (1991 – 1993)

LOGO Other Professional and Leadership Experience:

 

  Member of numerous professional and civic organizations, including:
    Economic Advisory Panel, Federal Reserve Bank of New York
    Council on Foreign Relations
    Advisory Board of the National Center on Addiction and Substance Abuse
  Other public company directorships: Automatic Data Processing, Inc.; BlackRock Closed-End Funds
  Prior public company directorships (past five years): KKR Financial Holdings LLC

LOGO Education:

 

  B.A. and B.S., University of Central Florida
  Ph.D. and A.M., Harvard University
 

 

 

 

 

 

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Steven A. Kandarian

age 64, Chairman of the Board, President and Chief Executive Officer, MetLife, Inc.

 

 

Director since 2011

Mr. Kandarian’s leadership and financial acumen, as well as his experience with the Company, including as President and Chief Executive Officer and his earlier responsibilities for Investments, Global Brand and Marketing Services, and enterprise-wide corporate strategy, have provided him with a deep understanding of the Company’s businesses and global operations and the Company’s strategic direction and leadership selection.

 

 

LOGO Professional Highlights:

 

  MetLife, Inc.
    Chairman of the Board (January 2012 – Present)
    President and Chief Executive Officer (May 2011 – Present)
    Executive Vice President and Chief Investment Officer (April 2005 – April 2011)
  Executive Director, Pension Benefit Guaranty Corporation, a United States government agency (2001 – 2004)
  Founder and Managing Partner, Orion Partners, LP, a private equity firm (1993 – 2001)
  Founder and President, Eagle Capital Holdings, where Mr. Kandarian formed a private merchant bank to sponsor equity investments in small and mid-sized businesses (1990 – 1993)
  Managing Director, Lee Capital Holdings, a private equity firm (1984 – 1990)
  Mr. Kandarian began his career at Rotan Mosle, Inc., an investment bank

LOGO Other Professional and Leadership Experience:

 

  Member of:
    Board of Directors, Damon Runyon Cancer Research Foundation
    Board of Directors, Lincoln Center for the Performing Arts
    Board of Directors, Partnership for New York City
    Business Council
    Business Roundtable
    Financial Services Forum
  Vice Chairman, Insurance Regulatory Committee of the Institute of International Finance (IIF)

LOGO Education:

 

  B.A., Clark University
  J.D., Georgetown University Law Center
  M.B.A., Harvard Business School
 

 

 

MetLife 2016 Proxy Statement    

 

 

 

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Alfred F. Kelly, Jr.

age 57, President and Chief Executive Officer, Intersection

 

 

Director since 2009

Through his roles as a senior executive of a global financial services business and as the head of information systems of the White House, Mr. Kelly brings significant experience in risk management and mitigation, marketing, information technology and data management, as well as a sophisticated understanding of the considerations of shareholder value creation. These experiences and expertise are important to the Board’s oversight of the Company’s design and approach to risk management.

 

 

LOGO Professional Highlights:

 

  President and Chief Executive Officer, Intersection, a digital technology and media company (March 2016 – Present)
  Management Advisor, TowerBrook Capital Partners L.P., an investment management firm (April 2015 – February 2016)
  Chairman, 2015 Papal Visit to New York City (January 2015 – November 2015)
  Chairman of the Board, President and Chief Executive Officer, NY/NJ Super Bowl Host Company, a nonprofit fundraising and planning organization (April 2011 – August 2014)
  American Express Company, a financial services corporation
    President (July 2007 – April 2010), responsible for global consumer businesses, including consumer and small business cards, customer service, global banking, prepaid products, consumer travel, and risk and information management
    Group President (2005 – 2007), responsible for several key businesses, including U.S. consumer and small business cards, U.S. customer service, and risk management
  Head of Information Systems, White House (1985 – 1987), with oversight of the information processing functions for several government agencies that comprise the Executive Office of the President

LOGO Other Professional and Leadership Experience:

 

  Chairman, Board of Directors, School of the Holy Child
  Vice Chairman, Wall Street Charity Golf Classic (benefits the Cystic Fibrosis Foundation)
  Member, Boards of Trustees, of:
    New York-Presbyterian Hospital
    St. Joseph’s Seminary and College
    New York Catholic Foundation
  Other public company directorships: Visa Inc.
  Prior public company directorships (past five years): Affinion Group Holdings, Inc. and its wholly-owned subsidiary, Affinion Group, Inc.

LOGO Education:

 

  B.A. and M.B.A., Iona College
 

 

 

 

 

 

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Edward J. Kelly, III

age 62, Former Chairman, Institutional Clients Group, Citigroup Inc.

 

 

Director since 2015

Mr. Kelly’s extensive leadership experience as an executive in the financial services industry further strengthens the Board’s strong qualifications to oversee the execution of MetLife’s strategies in complex legal and regulatory environments. His experience includes key roles in building a client-centric model and managing the global operations of a major financial institution. Further, Mr. Kelly’s deep knowledge of investments and financial products and services makes him a valuable asset to MetLife and its shareholders.

 

 

LOGO Professional Highlights:

 

  Citigroup Inc., a financial services corporation
    Chairman, Institutional Clients Group (January 2011– July 2014)
    Chairman, Global Banking (April 2010 – January 2011)
    Vice Chairman (July 2009 – March 2010)
    Chief Financial Officer (March 2009 – July 2009)
    Head of Global Banking (September 2008 – March 2009)
    President and Chief Executive Officer, Citi Alternative Investments (March 2008 – August 2008)
    President, Citi Alternative investments (February 2008 –March 2008)
  Managing Director, The Carlyle Group, an asset management firm (July 2007 – January 2008)
  Executive and leadership positions at various organizations, including:
    The PNC Financial Services Group, Inc., a financial services corporation (March 2007 – June 2007)
    Mercantile Bankshares Corporation, a financial services corporation (March 2001 – March 2007)
    J.P. Morgan Chase & Co. (and its predecessor company J.P. Morgan & Co. Incorporated), a financial services corporation (November 1994 – January 2001)
  Partner, Davis Polk & Wardwell LLP, a law firm (January 1988 – October 1994)

LOGO Other Professional and Leadership Experience:

 

  Senior Advisor, Corsair Capital, a private equity firm (October 2014 – Present)
  Member, Board of Directors, Securities Industry and Financial Markets Association, a financial industry trade association (January 2009 – April 2014)
  Member, Board of Directors, Focused Ultrasound Foundation, a non-profit entity (June 2015 – Present)
  Other public company directorships: CSX Corporation; XL Group plc

LOGO Education:

 

  A.B., Princeton University
  J.D., University of Virginia School of Law
 

 

 

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William E. Kennard

age 59, Former U.S. Ambassador to the European Union

 

 

Director since 2013

Mr. Kennard’s career has given him public policy and global investment expertise. As United States Ambassador to the European Union, Mr. Kennard worked to promote transatlantic trade and investment and reduce regulatory barriers to commerce. In his years of public service, Mr. Kennard advanced access of underserved populations to technology. Mr. Kennard’s extensive regulatory and international experience enhances the Board’s ability to oversee MetLife’s strategies.

 

 

LOGO Professional Highlights:

 

  Co-Founder and Non-Executive Chairman, Velocitas Partners LLC, an asset management firm (November 2013 – Present)
  Member of Operating Executive Board, Staple Street Capital, a private equity firm (November 2013 – Present)
  United States Ambassador to the European Union (December 2009 – August 2013)
  Managing Director, The Carlyle Group, an asset management firm (May 2001 – December 2009)
  United States Federal Communications Commission (December 1993 – January 2001)
    Chairman (November 1997 – January 2001)
    General Counsel (December 1993 – November 1997)
  Partner, Verner, Liipfert, Bernhard, McPherson and Hand (now DLA Piper), a law firm (April 1984 – December 1993)

LOGO Other Professional and Leadership Experience:

 

  Member of:
    U.S. Department of State Foreign Policy Advisory Board
    Board of Directors, Center for a New American Security
    Board of Directors, International African American Museum
  Trustee, Yale Corporation
  Other public company directorships: Duke Energy Corporation; AT&T Inc.; Ford Motor Company

LOGO Education:

 

  B.A., Phi Beta Kappa, Stanford University
  J.D., Yale Law School
 

 

 

 

 

 

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James M. Kilts

age 68, Founding Partner, Centerview Capital

 

 

Director since 2005

As a founding partner of a private equity firm and as a senior executive of several major consumer product companies with global sales and operations, Mr. Kilts brings an in-depth understanding of the business challenges and opportunities of diversified global enterprises and the related financial, risk management, talent management, and shareholder value creation considerations. These experiences and knowledge enhance the Board’s ability to oversee the management of MetLife.

 

 

LOGO Professional Highlights:

 

  Founding Partner, Centerview Capital, a private equity firm (October 2006 – Present)
  Vice Chairman, Board of Directors, The Procter & Gamble Company, a consumer products company (October 2005 – October 2006)
  The Gillette Company, a consumer products company
    Chairman of the Board (January 2001 – October 2005)
    Chief Executive Officer (February 2001 – October 2005)
    President (November 2003 – October 2005)
  President and Chief Executive Officer, Nabisco Group Holdings Corp. and Nabisco Inc., manufacturer and marketer of packaged food products (January 1998 – December 2000)
  Executive Vice President, Worldwide Food, Philip Morris, a manufacturer and marketer of packaged food products (1994 – 1997)
  Various positions, Kraft, a manufacturer and marketer of packaged food products (1989 – 1994), including:
    President, Kraft USA and Oscar Mayer
    Senior Vice President, Strategy and Development
    President, Kraft Limited in Canada
    Senior Vice President, Kraft International

LOGO Other Professional and Leadership Experience:

 

  Member of:
    Board of Overseers, Weill Cornell Medical College
    Board of Trustees, Knox College
    Board of Trustees, University of Chicago
    Board of Directors, Cato Institute
  Founder and Member, Steering Committee, Kilts Center for Marketing, University of Chicago Booth School of Business
  Other public company directorships: Pfizer, Inc.; Non-Executive Director of Nielsen Holdings plc
  Prior public company directorships (past five years): MeadWestvaco Corporation

LOGO Education:

 

  B.A., Knox College
  M.B.A., University of Chicago
 

 

 

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Catherine R. Kinney

age 64, Former President and Co-Chief Operating Officer, New York Stock Exchange, Inc.

 

 

Director since 2009

Ms. Kinney’s experience as a senior executive and chief operating officer of a multinational, regulated entity, her key role in transforming the New York Stock Exchange (NYSE) to a publicly held company, and her leadership in developing and establishing the NYSE corporate governance standards for its listed companies (including MetLife) demonstrate her knowledge of and experience with issues of corporate development, transformation and governance. These qualities are relevant to ensuring that the Board establishes and maintains effective governance structures appropriate for a global provider of insurance and financial products and services.

 

 

LOGO Professional Highlights:

 

  NYSE Euronext, a provider of financial services including securities exchange and clearing operations
    Served in Paris, France, with responsibility for overseeing the global listing program, marketing and branding (July 2007 – March 2009)
    President and Co-Chief Operating Officer, New York Stock Exchange, Inc. (merged with Euronext in 2008 to form NYSE Euronext) (2002 – 2008)
    Ms. Kinney joined the New York Stock Exchange in 1974 and held management positions in several divisions, with responsibility for all client relationships (1996 – 2007), trading floor operations and technology (1987 – 1996), and regulation (2002 – 2004)

LOGO Other Professional and Leadership Experience:

 

  Chair, Board of Trustees, Catholic Charities of the Archdiocese of New York
  Member of:
    Board of Directors, Sharegift USA
    Economic Club of New York
  Other public company directorships: NetSuite, Inc.; MSCI Inc.; QTS Realty Trust, Inc.

LOGO Education:

 

  B.A., magna cum laude, Iona College
  Advanced Management Program, Harvard Graduate School of Business
  Honorary Degrees: Georgetown University; Fordham University; Rosemont College
 

 

 

 

 

 

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Denise M. Morrison

age 62, President and Chief Executive Officer, Campbell Soup Company

 

 

Director since 2014

Ms. Morrison has a long and distinguished track record of building strong businesses and growing iconic brands. Her experience as chief executive officer of a global company provides her with a strong understanding of the key strategic challenges and opportunities of running a large, complex business, including financial management, operations, risk management, talent management and succession planning. Ms. Morrison’s strong commitment to corporate social responsibility and civic engagement make her a valuable resource for MetLife and its shareholders.

 

 

LOGO Professional Highlights:

 

  Campbell Soup Company, a food and beverage company (2003 – Present)
    President and Chief Executive Officer (August 2011 – Present)
    Executive Vice President and Chief Operating Officer (October 2010 – July 2011)
    President, North America Soup, Sauces and Beverages (October 2007 – September 2010)
    President, Campbell USA (June 2005 – September 2007)
    President, Global Sales and Chief Customer Officer (April 2003 – May 2005)
  Kraft Foods, Inc., a food and beverage company (1995 – 2003)
    Various leadership roles, including: Executive Vice President and General Manager, Kraft Snacks (2001 – 2003); Executive Vice President and General Manager, Kraft Confections (2001); Senior Vice President and General Manager, Nabisco Down the Street (2000); Senior Vice President, Nabisco Sales and Integrated Logistics (1998 – 2000)
  Various senior marketing and sales positions, Nestlé USA, Inc., a food and beverage company (1984 – 1995)
  Various trade and business development positions, PepsiCo, Inc., a food and beverage company (1982 – 1984)
  The Procter & Gamble Company, a consumer products company (1975 – 1982)

LOGO Other Professional and Leadership Experience:

 

  Member of President Barack Obama’s Export Council
  Member, Boards of Directors, of:
    Consumer Goods Forum (Co-Chair)
    Catalyst, Inc., a nonprofit organization that strives to expand opportunities for women in business
    Grocery Manufacturers Association
  Other public company directorships: Campbell Soup Company
  Prior public company directorships (past five years): The Goodyear Tire & Rubber Company

LOGO Education:

 

  B.S., Boston College
 

 

 

MetLife 2016 Proxy Statement    

 

 

 

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Kenton J. Sicchitano

age 71, Former Global Managing Director, PricewaterhouseCoopers LLP

 

 

Director since 2003

Mr. Sicchitano’s experience as a managing partner in a global advisory services firm has provided him with an understanding of the challenges and opportunities of managing a global business enterprise. His leadership roles in that firm’s Audit/Assurance, Business Advisory, and Tax Services groups have given him broad knowledge of and experience in accounting and tax issues that are valuable to the Board’s oversight of the management of MetLife, a global insurance and financial services firm.

 

 

LOGO Professional Highlights:

 

  PricewaterhouseCoopers LLP, a provider of audit and assurance, tax and consulting services (1970 – 2001)
    Mr. Sicchitano joined Price Waterhouse LLP, a predecessor firm of PricewaterhouseCoopers LLP, in 1970, becoming a Partner in 1979. He held a variety of global leadership positions, including Global Managing Partner of Audit and Business Advisory Services and Global Managing Partner responsible for Audit and Business Advisory, Tax and Legal, and Financial Advisory Services.

LOGO Other Professional and Leadership Experience:

 

  Mr. Sicchitano has in the past served as:
    Director and Chair of the Finance Committee, New England Deaconess Hospital
    Trustee, New England Aquarium
    President, Harvard Business School Association of Boston
    Director, Harvard Alumni Association and Harvard Business School Alumni Association
  Other public company directorships: PerkinElmer, Inc.; Analog Devices, Inc.

LOGO Education:

 

  B.A., Harvard College
  M.B.A., Harvard Business School
 

 

 

 

 

 

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Lulu C. Wang

age 71, Founder and Chief Executive Officer, Tupelo Capital Management LLC

 

 

Director since 2008

Ms. Wang’s extensive experience in investment management and financial services, her knowledge and understanding of global capital markets, particularly in Asia, and her service on the boards and investment committees of major educational and civic organizations have given her a perspective that is particularly relevant to the Board’s oversight of the management of the Company and its investments, as well as a deep understanding of the importance of MetLife’s and MetLife Foundation’s contributions to community institutions.

 

 

LOGO Professional Highlights:

 

  Founder and Chief Executive Officer, Tupelo Capital Management LLC, an investment management firm (1997 – Present)
  Director and Executive Vice President, Jennison Associates Capital Corporation, an investment management firm (1988 – 1997)
  Senior Vice President and Managing Director, Equitable Capital Management, an investment management firm (1978 – 1988)

LOGO Other Professional and Leadership Experience:

 

  Consulting Director, New York Community Trust
  Member of:
    Board of Overseers, Columbia Business School
    Board of Trustees, Metropolitan Museum of Art
    Board of Trustees, Rockefeller University
    Board of Trustees, Asia Society
  Trustee Emerita, Wellesley College
  Trustee Emerita, WNYC Public Radio

LOGO Education:

 

  B.A., Wellesley College
  M.B.A., Columbia Business School
 

 

 

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      Corporate Governance

 

Corporate Governance

The Board of Directors recognizes the importance of effective corporate governance in fulfilling its responsibilities to shareholders. This section describes some of MetLife’s key governance practices.

Corporate Governance Guidelines

The Board of Directors has adopted Corporate Governance Guidelines that set forth the Board’s policies on a number of governance-related matters, including:

 

  Director qualification standards, independence requirements and responsibilities;

 

  the identification of candidates for Board positions;

 

  management succession;

 

  Director access to management and outside advisors, including certain restrictions on the retention by Directors of an outside advisor that is otherwise engaged by the Company for another purpose;

 

  Director compensation;

 

  Director Share ownership guidelines;

 

  the appointment of a Lead Director by the Independent Directors;

 

  Director orientation and continuing education; and

 

  Annual evaluation of the Board’s performance.

The Corporate Governance Guidelines and the Company’s By-Laws provide for a majority voting standard in uncontested Director elections.

The Corporate Governance Guidelines provide that no Director may stand for election as a Board member after he or she reaches the age of 72, and that a Director may continue to serve until the annual meeting coincident with or immediately following his or her 72nd birthday. In addition, each Director must offer to resign from the Board upon a change or discontinuance of his or her principal occupation or business responsibilities.

A printable version of the Corporate Governance Guidelines is available on MetLife’s website at www.metlife.com/corporategovernance under the link “Corporate Governance Guidelines.”

Board and Committee Information

Composition and Independence of the Board of Directors. The Board currently consists of 12 Directors, 11 of whom are both Non-Management Directors and Independent Directors. A Non-Management Director is a Director who is not an officer of the Company or of any entity in a consolidated group with the Company. An Independent Director is a Non-Management Director who the Board of Directors has affirmatively determined has no material relationships with the Company or any of its consolidated subsidiaries and is independent within the meaning of the NYSE Corporate Governance Standards. An Independent Director for Audit and Compensation Committee purposes meets additional requirements under the NYSE Corporate Governance Standards and Rules 10A-3 and 10C-1, as applicable, under the Exchange Act.

The Board of Directors has adopted categorical standards to assist it in making determinations regarding Director independence. None of the relationships between the Independent Directors and MetLife is material, as provided by the Company’s categorical standards. The categorical standards are included in the Corporate Governance Guidelines of the Company, which are available on MetLife’s website at www.metlife.com/corporategovernance at the link “Corporate Governance Guidelines.”

The Board has affirmatively determined that all of the Directors, other than Steven A. Kandarian, the Company’s Chairman of the Board, President and Chief Executive Officer, are Independent Directors. The Board affirmatively determined in 2015 that Gen. John M. Keane, who served as Director during portions of 2015, was an Independent Director.

Board Leadership Structure. The Board of Directors believes that the best and most effective leadership structure for MetLife and its shareholders at this time is to have the Company’s Chief Executive Officer serve as Chairman of the Board, and an independent Director serve as Lead Director empowered with significant governance responsibilities.

Mr. Kandarian, as the Company’s Chief Executive Officer, is responsible for setting the Company’s strategic business direction, executing its strategic plans and managing its operations. Through his experience as Chief Executive Officer, and before that as Chief Investment Officer with oversight of MetLife’s enterprise-wide corporate strategy, Mr. Kandarian has

 

 

 

 

 

 

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gained a deep knowledge and understanding of the Company’s business, opportunities and challenges, and the capabilities and talents of the senior leadership team. Mr. Kandarian brings this knowledge and understanding to bear in the performance of his responsibilities as Chairman of the Board, by helping to guide the Board’s oversight on key business, strategic and risk matters for the Company and its shareholders. This insight is particularly important as the Company faces unique and extensive regulatory challenges and undertakes significant strategic initiatives, including the separation of a substantial portion of its U.S. Retail insurance business.

Having an executive Chairman of the Board helps ensure that the Directors receive appropriate information about the Company’s businesses and operations and have direct access to senior management. This approach strengthens the Directors’ oversight of the Company and their performance as Directors of a complex, highly regulated, global enterprise.

Cheryl W. Grisé is the Company’s Lead Director. Pursuant to the Corporate Governance Guidelines, the responsibilities of the Lead Director include:

 

  Presiding over meetings of the Board of Directors at which the Chairman of the Board is not present, including executive sessions of the independent Directors;

 

  Presiding over discussions of the Board of Directors when the topic presents a conflict (or potential conflict) for the Chairman of the Board;

 

  Calling meetings of the independent Directors, as necessary;

 

  Providing input on Board and Board Committee meeting agendas;

 

  Conferring with the Chairman of the Board on matters of importance that may require action or oversight by the Board, ensuring the Board focuses on key issues and tasks facing the Company;

 

  Facilitating communication and serving as a liaison between the Chairman of the Board and the independent Directors;

 

  Providing guidance to the Chairman of the Board regarding the ongoing development of Directors;

 

  Participating in the Compensation Committee’s annual performance evaluation of the Chairman of the Board and the Chief Executive Officer;
  Participating in any Chief Executive Officer succession planning;

 

  Together with the Chairman of the Board, ensuring the efficient and effective performance and functioning of the Board;

 

  In the event of the incapacity of the Chairman of the Board and Chief Executive Officer, overseeing the process for calling a special meeting to determine the action to be taken under the circumstances; and

 

  Being available, if requested by shareholders, when appropriate, for consultation and direct communication.

The Independent Directors elected Ms. Grisé to serve as Lead Director on the strength of her leadership qualities, deep knowledge of public company governance, and her experience as chief executive of a complex, highly regulated corporation. As Lead Director, she draws on these skills and experiences in working with the Chairman of the Board to set the Board’s agenda. She also brings a strong and independent voice to the boardroom to effectively lead the Independent Directors as they challenge management, consult on development of the Company’s strategy, and support the long-term success of the Company for its shareholders.

In addition, each of the Board Committees (with the exception of the Executive Committee) is chaired by an Independent Director with demonstrated expertise in the responsibilities of that Committee and strong leadership skills. Each of the Committees is also composed entirely of Independent Directors.

The successful partnership between the executive Chairman of the Board, independent Lead Director, Committee Chairs and other Independent Directors provides the Company with strong leadership and effective independent oversight of the Company and management. This demonstrates to the Board that this leadership structure is in the best interests of the Company and its shareholders at this time.

Executive Sessions of Independent Directors. At each regularly scheduled meeting of the Board of Directors, the Independent Directors of the Company meet in executive session without management present. The Lead Director presides at the executive sessions of the Independent Directors.

 

 

 

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Director Nomination Process. Nominations for election as Director at the Company’s annual meetings may be made either by the Board or by a shareholder or shareholders in compliance with the requirements of the Company’s By-Laws, as described below.

Nominations by the Board. The Company’s Board nominates Director nominees upon the recommendation of the Governance and Corporate Responsibility Committee. Potential Director nominees are identified by the Governance and Corporate Responsibility Committee and the Board of Directors through a variety of means, including search firms, Board members, Executive Officers and shareholders. Potential Director nominees provide information about their qualifications and participate in interviews conducted by individual Board members. Candidates are evaluated based on the information supplied by the candidates and information obtained from other sources.

In recommending candidates for election as Directors, the Governance and Corporate Responsibility Committee will take into consideration the need for the Board to have a majority of Directors that meet the independence requirements of the New York Stock Exchange Corporate Governance Standards, the ability of candidates to enhance the perspective and experience of the Board as a whole, and any other criteria the Board of Directors establishes from time to time.

Under the Company’s Corporate Governance Guidelines, the following specific, minimum qualifications must be met by any candidate whom the Governance and Corporate Responsibility Committee would recommend for election to the Board of Directors:

 

  Financial Literacy. Such person should be “financially literate,” as such qualification is interpreted by the Company’s Board of Directors in its business judgment.

 

  Leadership Experience. Such person should possess significant leadership experience, such as experience in business, finance, accounting, law, education or government, and shall possess qualities reflecting a proven record of accomplishment and an ability to work with others.

 

  Commitment to the Company’s Values. Such person shall be committed to promoting the financial success of the Company and preserving and enhancing the Company’s reputation as a global leader in business and shall be in agreement with the values of the Company as embodied in its codes of conduct.
  Absence of Conflicting Commitments. Such person should not have commitments that would conflict with the time commitments of a Director of the Company.

 

  Reputation and Integrity. Such person shall be of high repute and recognized integrity, and shall not have been convicted in a criminal proceeding or be named a subject of a pending criminal proceeding (excluding traffic violations and other minor offenses). Such person shall not have been found in a civil proceeding to have violated any federal or state securities or commodities law, and shall not be subject to any court or regulatory order or decree limiting his or her business activity, including in connection with the purchase or sale of any security or commodity.

 

  Other Factors. Such person shall have other characteristics considered appropriate for membership on the Board of Directors, including significant experience and accomplishments, an understanding of marketing and finance, sound business judgment, and an appropriate educational background.

The Governance and Corporate Responsibility Committee will consider shareholder recommendations of candidates for nomination as Director. To be timely, a shareholder recommendation must be submitted to the Governance and Corporate Responsibility Committee, MetLife, Inc., 1095 Avenue of the Americas, New York, NY 10036, Attention: Corporate Secretary, no earlier than 150 calendar days and no later than the close of business on the 120th calendar day prior to the first anniversary of the previous year’s annual meeting. Recommendations for nominations of candidates for election at MetLife’s 2017 annual meeting of shareholders must be received by the Corporate Secretary of MetLife, Inc. no earlier than January 15, 2017 and no later than the close of business on February 14, 2017 or such other date as may be announced by the Company in accordance with the Company’s By-Laws.

The Governance and Corporate Responsibility Committee makes no distinctions in evaluating nominees based on whether or not a nominee is recommended by a shareholder. Shareholders recommending a nominee must satisfy the notification, timeliness, consent and information requirements set forth in the Company’s By-Laws concerning Director nominations by shareholders. Among other things, the shareholder’s recommendation must set forth all the information regarding the recommended candidate that is required to be disclosed in solicitations of proxies for election of Directors pursuant to

 

 

 

 

 

 

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Section 14 of the Exchange Act and related regulations, and must include the recommended candidate’s written consent to being named in the Proxy Statement as a nominee and to serving as a Director if elected. The recommendation must also be accompanied by a completed Stockholder Disclosure Questionnaire. The Company’s By-Laws and the Stockholder Disclosure Questionnaire are available at www.metlife.com/corporategovernance.

Shareholder Proxy Access. In December 2015, the Board of Directors adopted amendments to the Company’s By-Laws to implement shareholder proxy access. Under the By-Laws, a shareholder, or a group of up to 20 shareholders, owning 3% or more of the Company’s outstanding shares of common stock continuously for at least three years, may nominate and include in the Company’s annual meeting proxy materials Director nominees constituting up to the greater of two individuals or 20% of the Board, provided that the shareholders and nominees satisfy the requirements specified in the By-Laws. For further information on procedures governing the submission of shareholder nomination of director nominees, see “Other Information — Information About the Annual Meeting, Proxy Voting, and Other Information — Deadline for submission of shareholder proposals and nominations for the 2017 annual meeting of shareholders” on page 102.

Risk Management Oversight. The Board of Directors oversees management in the design and implementation of the Company’s approach to risk management. For example, the Board oversees management’s development and execution of appropriate business strategies to mitigate the risk that such strategies will fail to generate long-term value for the Company and its shareholders or that such strategies will motivate management to take excessive risks.

The Board of Directors also oversees the development and implementation of processes and procedures to mitigate the risk of failing to ensure the orderly succession of the Chief Executive Officer and the senior executives of the Company. The Board believes that the continuing development of the Company’s managerial leadership is critically important to the Company’s success. The Board, in coordination with the Governance and Corporate Responsibility Committee, periodically reviews the skills, experience, and development plans of the Company’s senior leaders who may ultimately be candidates for senior executive positions. The Directors meet regularly with senior

leaders in the context of Board business, giving them an opportunity to assess the qualifications of these individuals. In addition, the Board plans for executive succession to ensure that the Company will have managerial talent available to replace current executives when that becomes necessary.

The Board of Directors has allocated its oversight of risk management among the Board as a whole and to Committees of the Board, which meet regularly and report back to the full Board. The Committees play significant roles in risk oversight.

The Finance and Risk Committee has broad oversight responsibilities for the Company’s risk management. The Committee oversees the Company’s financial policies and strategies, risk targets and risk positions, capital planning and adequacy, certain capital actions, mergers and acquisitions projects, and other financial matters. Annually, the Committee reviews, and recommends for Board approval, the Company’s Enterprise Risk Appetite Statement, which establishes quantitative and qualitative risk appetite measures and risk exposure considerations and guidelines, and the Company’s Capital Policy and Liquidity Risk Management Policy. The Committee reviews the Company’s assessment and management of material risks, including its performance against applicable policies and procedures and related benchmarks and target metrics. The Committee also receives and reviews the Own Risk and Solvency Assessment report, which summarizes the results of the Company’s analysis of its current and future risks, on an annual basis. The Committee coordinates its oversight with the efforts of the Chief Risk Officer (who oversees and coordinates risk assessment and mitigation enterprise-wide) and other members of management. It also coordinates its oversight of management with the Chairs of the other Board Committees.

The Audit Committee oversees the Company’s compliance with legal and regulatory requirements, reviews the Company’s policies on ethical conduct and periodically discusses the guidelines and policies with respect to the process by which the Company undertakes risk assessment and management. The Audit Committee reviews with management, the internal auditor and the independent auditor, the Company’s system of internal control over financial reporting that is relied upon to provide reasonable assurance of the integrity of the Company’s financial statements.

The Compensation Committee is responsible for reviewing the Company’s compensation practices and overseeing risk

 

 

 

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management with respect to the Company’s compensation arrangements. For example, the Committee designs the Company’s compensation arrangements to avoid creating incentives to take excessive risk. The Chief Risk Officer meets with the Compensation Committee annually to review the Company’s compensation arrangements for this purpose, and on other occasions at the Committee’s request to assist the Committee in its risk management oversight role.

The Governance and Corporate Responsibility Committee, in coordination with the Board, reviews the Company’s proposed succession and development plans for Executive Officers. It reviews the Company’s ethics and compliance programs and its sales practices to mitigate the risk of non-compliance, customer and regulatory complaints and other reputational risks. It also oversees the Company’s goals and strategies concerning legislative and regulatory initiatives that impact the interest of the Company.

The Investment Committee oversees the management and mitigation of risks associated with the investment portfolios of MetLife and of the consolidated MetLife enterprise, including credit risk, portfolio allocation and diversification risk, derivatives risk and counterparty risk.

Throughout the year, the Board and its Committees receive reports from the Chief Risk Officer and other senior management on enterprise risk management and specific risk topics. In particular, the Finance and Risk Committee reviews reports from the Chief Risk Officer and other senior management of the steps taken to measure, monitor and manage risk exposure in the enterprise. At each regularly scheduled meeting of the Finance and Risk Committee, the Chief Risk Officer meets in executive session of the independent Committee members without the Company’s Executive Officers to further discuss enterprise risk management.

For further discussion of the Committees’ responsibilities, see “Board Committees,” “Audit Committee,” “Compensation Committee,” “Finance and Risk Committee,” “Governance and Corporate Responsibility Committee” and “Investment Committee” below.

Board Membership. For information about the current membership of the Board and the Board Committees, see the Proxy Summary on page 9.

Board Meetings and Director Attendance. In 2015, the Board held eight meetings and the Board Committees of MetLife held a total of 42 meetings. Each of the current Directors who served during 2015 attended more than 75% of the aggregate number of meetings of the Board and the Committees on which the Director served.

Board Committees. MetLife’s Board of Directors has designated six standing Board Committees: Audit; Compensation; Executive; Finance and Risk; Governance and Corporate Responsibility; and Investment. All Committees, other than the Executive Committee, are chaired by and consist entirely of Independent Directors. The Committee Chairs review and approve agendas for all meetings of their respective Committees.

The Board of Directors has delegated authority to the Committees to assist the Board in overseeing the management of the Company. The responsibilities of each Committee are defined in its charter and summarized below. The charters for the Audit, the Compensation, and the Governance and Corporate Responsibility Committees incorporate the requirements of the Securities and Exchange Commission (SEC) and the NYSE to the extent applicable. Current, printable versions of these charters are available on MetLife’s website at www.metlife.com/corporategovernance.

Audit Committee. The Audit Committee oversees:

 

  the Company’s accounting and financial reporting processes and the audits of its financial statements;

 

  the adequacy of the Company’s internal control over financial reporting;

 

  the integrity of its financial statements;

 

  the qualifications and independence of the independent auditor;

 

  the appointment, retention, performance and compensation of the independent auditor and the performance of the internal audit function; and

 

  the Company’s compliance with legal and regulatory requirements.

The Audit Committee periodically discusses the Company’s guidelines and policies with respect to the process by which the Company undertakes risk assessment and risk management, including risks relating to MetLife information security systems

 

 

 

 

 

 

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and vendor risk management programs. The Audit Committee meets at least six times a year, and meets regularly in executive session separately with management and with the Company’s internal and external auditors. The Audit Committee met 13 times in 2015. The Audit Committee’s activities during 2015 with respect to the oversight of the independent auditor are described in more detail in “Proposal 3 — Ratification of Appointment of the Independent Auditor” beginning on page 38 and its responsibilities for oversight of risk management are further discussed under “Risk Management Oversight” beginning on page 27. The Audit Committee Charter provides a more detailed description of the role and responsibilities of the Audit Committee.

Independence, Financial Literacy and Audit Committee Financial Experts. All five members of the Audit Committee are Independent Directors who meet the additional independence requirements of the NYSE Corporate Governance Standards and Rule 10A-3 under the Exchange Act and are financially literate, as such qualification is interpreted by the Board of Directors. The Board of Directors has determined that the following two members of the Audit Committee qualify as “audit committee financial experts,” as such term is defined by the SEC: Alfred F. Kelly, Jr. and Edward J. Kelly, III.

Compensation Committee.

The Role and Responsibilities of the Compensation Committee. The Compensation Committee:

 

  assists the Board in fulfilling its responsibility to oversee the development and administration of compensation programs for the Company’s executives and other employees of the MetLife enterprise;

 

  approves the goals and objectives relevant to the Chief Executive Officer’s Total Compensation, evaluates the Chief Executive Officer’s performance in light of such goals and objectives, and endorses, for approval by the Independent Directors, the Chief Executive Officer’s Total Compensation level based on such evaluation;

 

  reviews, and recommends for approval by the Board, the Total Compensation of each person who is an “executive officer” of the Company under the Exchange Act and related regulations or an “officer” of the Company under Section 16 of the Exchange Act and related regulations, as well as the Company’s Chief Risk Officer, including their base salaries, annual incentive compensation, and long-term equity-based incentive compensation;
  oversees the management and mitigation of risks associated with the development and administration of the Company’s compensation programs, including efforts to ensure that the Company’s incentive plans do not encourage or reward excessive risk taking; and

 

  reviews and discusses with management the Compensation Discussion and Analysis to be included in the proxy statement (and incorporated by reference in the Annual Report on Form 10-K), and, based on this review and discussion, (1) recommends to the Board of Directors whether the Compensation Discussion and Analysis should be included in the Proxy Statement, and (2) issues the Compensation Committee Report for inclusion in the Proxy Statement. The 2016 Compensation Committee Report appears on page 41 of this Proxy Statement.

A more detailed description of the role and responsibilities of the Compensation Committee is set forth in the Compensation Committee Charter. Under its charter, the Compensation Committee may delegate to a subcommittee or to the Chief Executive Officer or other officers of the Company any portion of its duties and responsibilities, if it believes such delegation is in the best interests of the Company and the delegation is not prohibited by law, regulation or the NYSE Corporate Governance Standards. Management’s delegated authority does not include granting salary increases or incentive compensation to any Executive Officer, to any officer subject to the reporting requirements under Section 16 of the Exchange Act, or to the Company’s Chief Risk Officer. The Compensation Committee met nine times in 2015.

The Chairs of the Finance and Risk, Governance and Corporate Responsibility, and Audit Committees serve on the Compensation Committee. These Directors bring information and perspective from the work of other committees directly to bear on the Compensation Committee’s decisions. This enhances the Compensation Committee’s execution of its role, including its role in risk management oversight.

The Company’s processes for consideration and determination of executive compensation, and the central role of the Compensation Committee in those processes, are further described in the Compensation Discussion and Analysis beginning on page 42.

 

 

 

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Executive Compensation Advisors. The Compensation Committee has sole authority to retain or obtain the advice of a compensation consultant, independent legal counsel, or other advisor to the committee. It is not required to implement or act consistently with the advice or recommendations of any advisor, but retains discretion to act according to its own judgment. The Compensation Committee may retain or obtain the advice of an advisor only after taking into consideration factors related to that person’s independence from management that it determines are relevant, including each of the factors it is required to take into consideration under the Corporate Governance Standards of the NYSE, unless the retention of the advisor is exempt from this requirement under NYSE rules. The Compensation Committee is responsible for the appointment, compensation, and oversight of any advisor it retains. The Company is obligated to provide appropriate funding for reasonable compensation of any such advisor, as determined by the Compensation Committee.

To assist the Compensation Committee in carrying out its responsibilities, the Compensation Committee retained Meridian Compensation Partners, LLC (Meridian) as its executive compensation consultant. Meridian has provided the Compensation Committee with competitive market compensation data and overall market trends about executive compensation, has advised the Compensation Committee about the overall design and implementation of MetLife’s executive compensation programs, including decisions made under the programs, and has advised the Committee about regulatory, governance and accounting developments that may affect the Company’s executive compensation programs.

The Compensation Committee believes that its compensation consultant must be able to provide it with candid, direct, independent and objective advice. In order to promote the objectivity, independence, and candor of Meridian’s advice:

 

  Meridian reports directly to the Committee about executive compensation matters;

 

  Meridian meets with the Committee in executive sessions that are not attended by any of the Company’s Executive Officers;

 

  Meridian has direct access to the Chair and members of the Committee between meetings; and

 

  the Committee has not directed Meridian to perform its services in any particular manner or under any particular method.

To help ensure that the Committee continues to receive independent and objective advice, the Company’s Corporate Governance Guidelines provide that any consultant retained by the Compensation Committee on executive compensation matters should not be retained to provide any other services to the Company. Meridian did not provide any such other services in 2015.

In addition, Meridian has provided the Compensation Committee with information regarding its relationship with MetLife and Meridian’s independence from management. This included information covering factors the Compensation Committee is required under NYSE rules to take into consideration before selecting an advisor. The Compensation Committee did not find that Meridian’s work raised any conflict of interest.

For information about the key factors that the Compensation Committee considers in determining the compensation of the members of the Executive Group, as well as the role of the Chief Executive Officer and the Executive Vice President and Chief Human Resources Officer in setting such compensation, see the Compensation Discussion and Analysis beginning on page 42. Also see the Compensation Discussion and Analysis for information about compensation paid to the persons listed in the Summary Compensation Table on page 69.

Compensation Committee Interlocks and Insider Participation. No member of the Compensation Committee has ever been an officer or employee of MetLife or any of its subsidiaries. During 2015, no Executive Officer of MetLife served as a director or member of the compensation committee (or other committee serving an equivalent function) of any other entity where one of the executive officers is or has been a Director of MetLife or a member of MetLife’s Compensation Committee.

Executive Committee. The Executive Committee may exercise the powers and authority of the Board of Directors during intervals between meetings of the Board of Directors. The Executive Committee did not meet in 2015.

Finance and Risk Committee. The Finance and Risk Committee oversees the Company’s financial policies and strategies; its capital structure, plans and policies, including capital adequacy, dividend policies and share repurchases; its proposals on certain capital actions and other financial matters; its assessment and management of material risks; and in consultation with the Compensation Committee, the appointment, retention and

 

 

 

 

 

 

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performance of the Chief Risk Officer. The Finance and Risk Committee has in the past engaged and is likely from time to time in the future to engage external consultants to assess the alignment of the Company’s risk models and practices to industry best practices.

Specifically, the Finance and Risk Committee:

 

  reviews the Company’s key financial, risk and business metrics;

 

  reviews and monitors all aspects of the Company’s capital plan, actions and policies (including the guiding principles used to evaluate all proposed capital actions), targets and structure (including the monitoring of capital adequacy and of compliance with the Company’s capital plan);

 

  reviews proposals and reports concerning certain capital actions and other financial matters, consistent with the Company’s capital plan, safety and soundness principles and applicable law; and

 

  reviews policies, practices and procedures regarding risk assessment and management.

The Finance and Risk Committee met seven times in 2015. For further discussion of the Finance and Risk Committee’s responsibilities for oversight of risk management, see “Risk Management Oversight” beginning on page 27.

Governance and Corporate Responsibility Committee. The Governance and Corporate Responsibility Committee assists the Board of Directors in identifying individuals qualified to become members of the Company’s Board, consistent with the criteria established by the Board; proposing candidates to be nominated for election as Directors at annual or special meetings of shareholders or to be elected by the Board to fill any vacancies on the Board; developing and recommending to the Board of Directors corporate governance guidelines applicable to the Company; and reviewing proposed succession plans for the Chief Executive Officer and the Company’s other executive officers, and making recommendations to the Board of Directors with respect to such plans. It also oversees the Company’s compliance responsibilities and activities, including its legislative and regulatory initiatives, sales practices, and ethics and compliance programs, as well as the Company’s policies concerning its corporate citizenship programs.

Each year, the Governance and Corporate Responsibility Committee oversees a robust Board evaluation. The Committee

solicits comments from Directors on the Board’s and its Committees’ performance, including the adequacy of the time allocated to Board and Committee business, the quality of materials provided by management, and the quality of the presentations. Directors are also invited to recommend topics for the Board to consider at future meetings. The Committee reports these results to the full Board. The Board completes its evaluation through a discussion in executive session without any management present.

The Governance and Corporate Responsibility Committee is responsible for reviewing the compensation and benefits of the Company’s non-employee Directors and recommending any changes to the Board. During 2015, Meridian provided the Board with an analysis of the competitiveness of the compensation program for Non-Management Directors, market observations, and relevant compensation trends. For more information on Director Compensation, including the committee’s decision to change the Director compensation program effective in 2016, see “Director Compensation in 2015” on page 34.

The Governance and Corporate Responsibility Committee also oversees the management and mitigation of risks related to failure to comply with required or appropriate corporate governance standards.

The Governance and Corporate Responsibility Committee Charter provides a more detailed description of the role and responsibilities of the Governance and Corporate Responsibility Committee. The Governance and Corporate Responsibility Committee met seven times in 2015.

Investment Committee. The Investment Committee oversees the management of investment activities of MetLife and, on a consolidated basis, of MetLife and all of its direct and indirect subsidiaries. In performing its oversight responsibilities, the Committee reviews reports from the investment officers on (i) the investment activities and performance of the investment portfolios of MetLife and its subsidiaries and (ii) the conformity of investment activities with the Investment Committee’s general authorizations and investment guidelines. The Investment Committee also oversees the management and mitigation of risks associated with the investment portfolios of MetLife and of the consolidated MetLife enterprise. The Investment Committee met six times in 2015.

 

 

 

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Director Share Ownership Guidelines; Hedging and Pledging Prohibited

Each Non-Management Director is expected to achieve a level of ownership equal in value to at least four times the cash component of the annual retainer by December 31 of the year in which the fourth anniversary of election to the Board occurs. As of December 31, 2015, each Non-Management Director who had served beyond the fourth anniversary of election to the Board had met these guidelines.

The Company prohibits Directors and employees, including Executive Group members, from engaging in short sales, hedging, and trading in put and call options, with respect to the Company’s securities. In 2015, the Board of Directors changed Company policy to prohibit Directors and employees, including Executive Group members, from pledging MetLife securities. These policies are intended to prevent a misalignment of interests with Company shareholders or the appearance of such a misalignment.

Director Indemnity Plan

The Company’s By-Laws provide for the Company to indemnify, and advance expenses to, a person who is threatened with litigation or made a party to a legal proceeding because of the person’s service as a Director of the Company. In addition, the Company’s Director Indemnity Plan affirms that a Director’s rights to this indemnification and expense advancement are contract rights. The indemnity plan also provides for expenses to be advanced to former Directors on the same basis as they are advanced to current Directors. Any amendment or repeal of the rights provided under the indemnity plan would be prospective only and would not affect a Director’s rights with respect to events that have already occurred.

Shareholder Right to Call a Special Meeting

In March 2016, the Board of Directors adopted amendments to the Company’s By-Laws that allow shareholders to call a special meeting. Under the By-Laws, shareholders representing ownership of 25% or more of the Company’s outstanding Shares may call a special meeting of the shareholders, provided that the shareholders requesting the meeting satisfy the requirements specified in the By-Laws.

Procedures for Reviewing Related Person Transactions

The Company has established written procedures for the review, approval or ratification of related person transactions. A related person transaction includes certain financial transactions, arrangements or relationships in which the Company is or is proposed to be a participant and in which a Director, Director nominee or Executive Officer of the Company or any of their immediate family members has or will have a material interest. Related person transactions may include:

 

  Legal, investment banking, consulting or management services provided to the Company by a related person or an entity with which the related person is affiliated;

 

  Sales, purchases and leases of real property between the Company and a related person or an entity with which the related person is affiliated;

 

  Material investments by the Company in an entity with which a related person is affiliated;

 

  Contributions by the Company to a civic or charitable organization for which a related person serves as an executive officer; and

 

  Indebtedness or guarantees of indebtedness involving the Company and a related person or an entity with which the related person is affiliated.

Under the procedures, Directors, Director nominees and Executive Officers of the Company are required to report related person transactions in writing to the Company. The Governance and Corporate Responsibility Committee reviews, approves or ratifies related person transactions involving Directors, Director nominees and the Chief Executive Officer or any of their immediate family members. A vote of a majority of disinterested Directors of the Governance and Corporate Responsibility Committee is required to approve or ratify a transaction. The Chief Executive Officer reviews, approves or ratifies related person transactions involving Executive Officers of the Company (other than the Chief Executive Officer) or any of their immediate family members. The Chief Executive Officer may refer any such transaction to the Governance and Corporate Responsibility Committee for review, approval or ratification if he believes that such referral would be appropriate.

The Governance and Corporate Responsibility Committee or the Chief Executive Officer will approve a related person transaction if it is fair and reasonable to the Company and consistent with

 

 

 

 

 

 

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the best interests of the Company, taking into account the business purpose of the transaction, whether the transaction is entered into on an arm’s-length basis on terms fair to the Company, and whether the transaction is consistent with applicable codes of conduct of the Company. If a transaction is not approved or ratified, it may be referred to legal counsel for review and consultation regarding possible further action by the Company. Such action may include terminating the transaction if not yet entered into or, if it is an existing transaction, rescinding the transaction or modifying it in a manner that would allow it to be ratified or approved in accordance with the procedures.

Related Person Transactions

A Company affiliate employs a sibling of Maria R. Morris, Executive Vice President and member of the Executive Group. Ms. Morris’ sibling earned compensation of approximately $400,595 for 2015. The employee is not an Executive Group member and does not report directly to an Executive Group member. The employee participated in compensation and benefit arrangements for 2015 generally applicable to similarly-situated employees. The employee is primarily engaged in sales activity, and the employee’s compensation is significantly driven by sales incentive compensation. The employee’s compensation for 2015 reflected new business sales to group insurance customers, of which the employee produced five times as many sales for 2015 as for the prior year. There were no material changes to the terms of the employee’s sales incentive compensation arrangements from 2014.

Codes of Conduct

Financial Management Code of Professional Conduct. The Company has adopted the MetLife Financial Management Code of Professional Conduct, a “code of ethics” as defined under the rules of the SEC that applies to the Company’s Chief Executive Officer, Chief Financial Officer, Chief Accounting Officer and all professionals in finance and finance-related departments. A current, printable version of the Financial Management Code of Professional Conduct is available on the Company’s website at www.metlife.com/corporategovernance by selecting Corporate Conduct and then the appropriate link under the heading “Codes of Conduct.”

Directors’ Code of Business Conduct and Ethics and Code of Conduct for MetLife Employees. The Company has adopted the Directors’ Code of Business Conduct and Ethics, which is applicable to all members of the Company’s Board of Directors including the Chief Executive Officer, and the Code of Conduct, which applies to all employees of the Company and its affiliates, including the Executive Officers of the Company. Current, printable versions of the Directors’ Code and the Code of Conduct for MetLife employees are available on the Company’s website at www.metlife.com/corporategovernance by selecting Corporate Conduct and then the appropriate link under the heading “Codes of Conduct.”

 

 

 

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Director Compensation in 2015

 

                                                                 
    Name          

 

Fees Earned or
Paid in Cash
($)

 

            Stock
Awards
($)
            All Other
Compensation
($)
           

Total

($)

     
                           
 

Cheryl W. Grisé

        $180,000            $130,023            $1,619            $311,642     
 

Carlos M. Gutierrez

        $130,000            $130,023            $1,619            $261,642     
 

R. Glenn Hubbard

        $155,000            $130,023            $6,619            $291,642     
 

John M. Keane1

        $           0            $           0            $   563            $       563     
 

Alfred F. Kelly, Jr.

        $155,000            $130,023            $6,619            $291,642     
 

Edward J. Kelly, III2

        $152,075            $152,121            $1,487            $305,683     
 

William E. Kennard

        $130,000            $130,023            $6,619            $266,642     
 

James M. Kilts

        $155,000            $130,023            $6,619            $291,642     
 

Catherine R. Kinney

        $130,000            $130,023            $4,119            $264,142     
 

Denise M. Morrison

        $130,000            $130,023            $1,619            $261,642     
 

Kenton J. Sicchitano

        $155,000            $130,023            $6,619            $291,642     
 

Lulu C. Wang

        $130,000            $130,023            $1,619            $261,642     
                                                                 

 

1 Gen. Keane served on the Board of Directors through the Company’s 2015 annual meeting of shareholders, at which time he retired from service.

 

2 Edward J. Kelly, III was appointed to the Board of Directors in 2015 before that year’s Annual Meeting. As a result, the Company paid Mr. Kelly a prorated annual retainer fee in advance for services from his appointment through the 2015 Annual Meeting. Approximately 50% of the retainer, or $22,098, was paid through the grant of 430 Shares at a grant date fair value of per Share of $51.39, the closing price of a Share on the NYSE on the grant date. The rest of the retainer was paid in $22,075 cash. For directors who were members of the Board of Directors in 2014, the retainer fee for the portion of 2015 prior to the 2015 Annual Meeting was paid in 2014.

 

The Non-Management Directors included in the 2015 Director Compensation table, and the following discussion pertaining to the table, are limited to those who served as Directors during 2015.

Fees Earned or Paid in Cash and Stock Awards. The Non-Management Directors’ annual retainer fees are reported under “Fees Earned or Paid in Cash” and “Stock Awards” in the Director Compensation table.

After the Company’s 2015 Annual Meeting, each active Non-Management Director was paid an annual retainer of $260,000 in advance for services through the 2016 Annual Meeting. Approximately 50% of the retainer, or $130,023, was paid through the grant of 2,557 Shares at a grant date fair value per share of $50.85, the closing price of a Share on the NYSE on the

grant date. In each case, the grant date fair value of the stock awards is slightly higher than 50% of the total annual retainer of $260,000 because the number of Shares the Company delivered to the director was rounded up to a whole number of Shares. The rest of the retainer was paid in $130,000 cash.

In addition, the Company paid an annual cash retainer fee of $25,000 in 2015 to each Non-Management Director who served as Chair of a Board Committee (Ms. Grisé, Alfred F. Kelly, Jr., Mr. Kilts, Mr. Sicchitano and Mr. Hubbard). The Company also paid an annual cash retainer of $25,000 in 2015 to its Lead Director (Ms. Grisé).

The MetLife, Inc. 2015 Non-Management Director Stock Compensation Plan (2015 Director Stock Plan), which was

 

 

 

 

 

 

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Director Compensation in 2015       

 

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approved by the Company’s shareholders in 2014, authorized the Company to issue Shares in payment of Director retainer fees. The dollar amounts reported under “Stock Awards” represent the grant date fair value of such Share awards as computed for financial statement reporting purposes in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 718 (ASC 718). The grant date fair value represents the number of Shares granted multiplied by the closing price of the Shares on the NYSE on the grant date. Share awards granted to the Non-Management Directors as part of their annual retainer vest and become deliverable immediately upon their grant. As a result, no Share awards were outstanding for any of the Non-Management Directors as of December 31, 2015. None of the Non-Management Directors had any outstanding and unexercised Stock Options as of December 31, 2015.

The Governance and Corporate Responsibility Committee is responsible for reviewing the compensation and benefits of the Company’s non-employee Directors and recommending any changes to the Board. During 2015, Meridian provided the Board with an analysis of the competitiveness of the compensation program for Non-Management Directors, market observations, and relevant compensation trends. The Committee recommended, and the non-management members of the Board of Directors approved, increases to the amount of the annual retainers paid to Non-Management Directors. The new annual retainer for each Non-Management Director will be $300,000, with half remaining payable in cash and half remaining payable in Shares. The new annual retainer for the Lead Director will be $35,000. The new annual retainer for each Non Management Director who serves as Chair of a Board Committee is reported in the table below.

 

Committee      

 

New Annual

Retainer Rate for Committee Chair

 

Audit Committee

      $40,000

Finance and Risk Committee

      $35,000

Compensation Committee

      $30,000

Governance and Corporate Responsibility Committee

     

 

$25,000

Investment Committee

      $25,000

These changes will be effective as of the 2016 Annual Meeting.

A Non-Management Director may defer the receipt of all or part of his or her fees payable in cash or deliverable in Shares (and any imputed reinvested dividends on those Deferred Shares) until a later date or until after he or she ceases to serve as a Director.

All Other Compensation. The Non-Management Directors’ 2015 benefits, gift programs, and reportable perquisites and other personal benefits are included under “All Other Compensation” in the Director Compensation table.

Life Insurance Programs. MetLife paid $1,584 in premiums for each Non-Management Director who served the entirety of 2015. This provided each with $200,000 of group life insurance coverage during 2015. The Company incurred a pro rata portion of that cost to provide coverage to Mr. Edward J. Kelly, III (a cost of $1,452) and Gen. Keane (a cost of $528), for the portion of 2015 during which each served as a Director.

Business Travel Insurance Program. MetLife provided each Non-Management Director with business travel accident insurance coverage for travel on MetLife business. MetLife’s per Director cost for this coverage in 2015 was $35.

Charitable and Matching Gifts Programs. The MetLife Foundation provided up to $5,000 in matching contributions for each Non-Management Director’s contributions to colleges and universities in 2015 under a matching gift program for employees and Non-Management Directors. The foundation contributed $5,000 to match contributions made by each of Mr. Hubbard, Alfred F. Kelly, Jr., Mr. Kennard, Mr. Kilts, and Mr. Sicchitano in 2015. It also contributed $2,500 to match contributions made by Ms. Kinney in 2015.

In addition, the foundation provided a matching contribution of $5,000, $2,500, and $2,500 for contributions that Mr. Kennard, Ms. Kinney, and Mr. Sicchitano, respectively, made in 2014. Because these contributions related to the directors’ 2014 contributions, they are not reported on the table above. They were not reported in the Company’s 2015 Proxy Statement because the process for matching the contributions did not begin until after that Proxy Statement was filed.

Perquisites and Other Personal Benefits. The Company paid for personal expenses of certain Non-Management Directors or their guests in connection with Company business conferences or other events in 2015. For each Non-Management Director for whom such expenses were paid, the aggregate amount paid by

 

 

 

MetLife 2016 Proxy Statement    

 

 

 

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Table of Contents

 

LOGO     

      Director Compensation in 2015

 

the Company in 2015 was less than $10,000, and as a result is not reported.

Compensation of Mr. Kandarian. Mr. Kandarian was compensated as an employee in 2015, and received no compensation in his capacity as a member of the Board of

Directors. For information about compensation for Mr. Kandarian in 2015, see the Summary Compensation Table on page 69 and the accompanying discussion.

 

 

 

 

 

 

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    MetLife 2016 Proxy Statement

 


Table of Contents
PROPOSAL 2 — Advisory Vote on Exclusive Forum By-Law      

 

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PROPOSAL 2 — ADVISORY VOTE ON EXCLUSIVE FORUM BY-LAW

 

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The Board of Directors recommends that you vote FOR the proposal to advise the Board to adopt a by-law designating Delaware the exclusive forum for certain legal actions.

 

 

MetLife’s Board of Directors reviews the Company’s corporate governance practices on a continuing basis. In light of evolving practices, the Board is asking shareholders for their approval, on a non-binding basis, of a change to the Company’s By-Laws to designate Delaware, as the Company’s state of incorporation, the exclusive forum for certain legal actions.

Specifically, such an addition to the By-Laws would, to the fullest extent permitted by law, designate the Delaware Court of Chancery as the exclusive forum for (1) any derivative action or proceeding brought on behalf of the Company; (2) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Company or its affiliates to the Company or the Company’s shareholders; (3) any action asserting a claim arising pursuant to any provision of the General Corporation Law of the State of Delaware or the Company’s Certificate of Incorporation or By-laws (as either may be amended from time to time); or (4) any action asserting a claim against the Company or any director, officer or other employee of the Company or its affiliates governed by the internal affairs doctrine, that is, generally, matters peculiar to the relationships among or between the Company and its officers, directors, and shareholders. If the Delaware Court of Chancery lacks jurisdiction over the matter, then the action would be heard in a state court located within the State of Delaware or, if no Delaware state court has jurisdiction, the federal district court for the District of Delaware. Anyone who acquires or holds any interest in shares of capital stock of the Company will be deemed to consent to these terms. The potential text of such an addition to the Company’s By-Laws is provided in Appendix C (the Exclusive Forum By-Law).

Without such a By-Law, plaintiffs seeking to bring claims against the Company or its affiliates could use the Company’s diverse operations to bring duplicative suits in multiple jurisdictions. The Exclusive Forum By-Law could help the Company, its affiliates, or their employees, officers, or directors avoid being subject to multiple lawsuits in multiple jurisdictions on the same matter. The Company and its shareholders may thus avoid costly and duplicative litigation and the risk of inconsistent outcomes when two similar cases proceed in different courts.

Plaintiffs in such actions could also choose a forum that may not apply the law of Delaware in the same manner as the Delaware Court of Chancery would be expected to do so. The Exclusive Forum

By-Law could help the Company and its shareholders avoid the risk that Delaware law would be misapplied by a court in another jurisdiction. The Delaware Court of Chancery is widely regarded as the preeminent court for the determination of disputes involving a Delaware corporation’s internal affairs in terms of precedent, experience and focus. That court has experienced jurists who have a deep understanding of Delaware corporate law and the duties of directors, officers, and employees, as well as procedures that can provide relatively quick decisions that can limit the time, cost and uncertainty of protracted litigation for all parties. Delaware’s well-developed body of case law provides shareholders with more certainty about the outcome of intra-corporate disputes.

At the same time, the Exclusive Forum By-Law would give the Company the flexibility to consent to an alternative forum on a case-by-case basis where the Company determines that its interests and those of its shareholders are best served by permitting a dispute to proceed in a forum other than Delaware.

The Board is not asking shareholders to vote to approve an Exclusive Forum By-Law in reaction to any specific litigation. Rather, the Board may consider adopting the Exclusive Forum By-Law to prevent potential future harm to the Company and its shareholders. Although provisions such as the Exclusive Forum By-Law are becoming increasingly common, the Company cannot be sure all courts outside of Delaware will enforce the terms of the Exclusive Forum By-Law and transfer any covered proceeding to the Delaware courts. A by-law such as the Exclusive Forum By-law may limit a shareholder’s ability to bring a claim in a judicial forum that the shareholder finds favorable for certain disputes, and may discourage shareholder lawsuits with respect to such claims.

Following the annual meeting, the Board will consider the results of the shareholder vote, positive or negative, along with other information it determines relevant, and consider what actions to take as a result. Those actions may include the adoption of the Exclusive Forum By-Law.

Accordingly, the Board of Directors recommends that you vote FOR the proposal to advise the Board to adopt a by-law designating Delaware the exclusive forum for certain legal actions.

 

 

 

MetLife 2016 Proxy Statement    

 

 

 

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Table of Contents

 

LOGO     

      PROPOSAL 3 — Ratification of Appointment of the Independent Auditor

 

PROPOSAL 3 — RATIFICATION OF APPOINTMENT OF THE INDEPENDENT AUDITOR

 

LOGO     

The Board of Directors recommends that you vote FOR the ratification of the appointment of Deloitte & Touche LLP as MetLife’s independent auditor for the fiscal year ending December 31, 2016.

 

 

The Audit Committee has appointed Deloitte & Touche LLP (Deloitte) as the Company’s independent auditor for the fiscal year ending December 31, 2016. Deloitte’s long-term knowledge of MetLife and the MetLife group of companies, combined with its insurance industry expertise and global presence, has enabled it to carry out its audits of the Company’s financial statements with effectiveness and efficiency. The members of the Audit Committee believe that the continued retention of Deloitte to serve as the Company’s independent auditor is in the best interests of the Company and its shareholders.

The appointment of Deloitte by the Audit Committee is being presented to the shareholders for ratification. If the shareholders do not ratify the appointment, the Audit Committee will reconsider its decision and may continue to retain Deloitte. If the shareholders ratify the appointment, the Audit Committee continues to have the authority to and may change such appointment at any time during the year. The Audit Committee will make its determination regarding such retention or change in light of the best interests of MetLife and its shareholders.

In considering Deloitte’s appointment, the Audit Committee reviewed the firm’s qualifications and competencies, including the following factors:

 

  Deloitte’s status as a registered public accounting firm with the Public Company Accounting Oversight Board (United States) (PCAOB) as required by the Sarbanes-Oxley Act of 2002 (Sarbanes-Oxley) and the Rules of the PCAOB;

 

  Deloitte’s independence and its processes for maintaining its independence;

 

  the results of the independent review of the firm’s quality control system;

 

  the global reach of the Deloitte network of member firms and its alignment with MetLife’s worldwide business activities;

 

  the key members of the engagement team, including the lead audit partner, for the audit of the Company’s financial statements;

 

  Deloitte’s performance during its engagement for the fiscal year ended December 31, 2015;
  the quality of Deloitte’s communications with the Audit Committee regarding the conduct of the audit, and with management with respect to issues identified in the audit, and the consistency of such communications with applicable auditing standards;

 

  Deloitte’s approach to resolving significant accounting and auditing matters, including consultation with the firm’s national office; and

 

  Deloitte’s reputation for integrity and competence in the fields of accounting and auditing.

Deloitte has served as independent auditor of the Company since 1999, and as auditor of affiliates of the Company for more than 75 years. Under current legal requirements, the lead or concurring auditor partner for the Company may not serve in that role for more than five consecutive fiscal years, and the Audit Committee ensures the regular rotation of the audit engagement team partners as required by law. The Chair of the Audit Committee is actively involved in the selection process for the lead and concurring partners.

The Audit Committee approves Deloitte’s audit and non-audit services in advance as required under Sarbanes-Oxley and SEC rules. Before the commencement of each fiscal year, the Audit Committee appoints the independent auditor to perform audit services that the Company expects to be performed for the fiscal year and appoints the auditor to perform audit-related, tax and other permitted non-audit services. The Audit Committee or a designated member of the Audit Committee to whom authority has been delegated may, from time to time, pre-approve additional audit and non-audit services to be performed by the Company’s independent auditor. Any pre-approval of services between Audit Committee meetings must be reported to the full Audit Committee at its next scheduled meeting.

The Audit Committee is responsible for approving fees for the audit and for any audit-related, tax or other permitted non-audit services. If the audit, audit-related, tax and other permitted non-audit fees for a particular period or service exceed the amounts previously approved, the Audit Committee determines whether or not to approve the additional fees.

 

 

 

 

 

 

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    MetLife 2016 Proxy Statement

 


Table of Contents
Independent Auditor’s Fees for 2015 and 2014      

 

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Representatives of Deloitte will attend the Annual Meeting. They will have an opportunity to make a statement if they desire to do so, and they will be available to respond to appropriate questions.

The Board of Directors recommends that you vote FOR the ratification of the appointment of Deloitte & Touche LLP as MetLife’s independent auditor for the fiscal year ending December 31, 2016.

 

Independent Auditor’s Fees for 2015 and 2014

The table below presents fees for professional services rendered by Deloitte for the audit of the Company’s annual financial statements, audit-related services, tax services and all other services for the years ended December 31, 2015 and 2014. All fees shown in the table were related to services that were approved by the Audit Committee.

The fees that the Company incurs for audit, audit-related, tax and other professional services reflect the complexity and scope of the Company’s operations, including:

 

  operations of the Company’s subsidiaries in multiple, global jurisdictions (approximately 40 during 2015);

 

  the complex, often overlapping regulations to which the Company and its subsidiaries are subject in each of those jurisdictions;

 

  the operating insurance companies’ responsibility for preparing audited financial statements; and

 

  the applicability of SEC reporting requirements to several of the Company’s operating insurance subsidiaries, which are SEC registrants.

 

                                           
   

 

($ in millions)

 

            

 

2015

 

              

 

2014

 

     
                     
 

Audit Fees1

         $ 71.8             $ 71.4     
 

Audit-Related Fees2

        

 

$

 

9.8

 

  

        

 

$

 

7.0

 

  

 
 

Tax Fees3

         $ 4.0             $ 3.1     
 

All Other Fees4

         $ 1.0             $ 0.3     
                                           
1 Fees for services to perform an audit or review in accordance with auditing standards of the PCAOB and services that generally only the Company’s independent auditor can reasonably provide, such as comfort letters, statutory audits, attest services, consents and assistance with and review of documents filed with the SEC. In 2015 Deloitte issued over 250 audit reports.

 

2 Fees for assurance and related services that are traditionally performed by the Company’s independent auditor, such as audit and related services for employee benefit plan audits, due diligence related to mergers, acquisitions and divestitures, accounting consultations and audits in connection with proposed or consummated acquisitions and divestitures, control reviews, attest services not required by statute or regulation, and consultation concerning financial accounting and reporting standards.

 

3 Fees for tax compliance, consultation and planning services. Tax compliance generally involves preparation of original and amended tax returns, claims for refunds and tax payment planning services. Tax consultation and tax planning encompass a diverse range of advisory services, including assistance in connection with tax audits and filing appeals, tax advice related to mergers, acquisitions and divestitures, advice related to employee benefit plans and requests for rulings or technical advice from taxing authorities. In 2015, tax compliance and tax preparation fees total $1.9 million and tax advisory fees total $2.1 million and in 2014, tax compliance and preparation fees total $1.3 million and tax advisory fees total $1.8 million.

 

4 Fees for other types of permitted services, including employee benefit advisory services, risk and other consulting services, financial advisory services and valuation services.

Audit Committee Report

This report is submitted by the Audit Committee of the MetLife, Inc. (MetLife or the Company) Board of Directors. No portion of this Audit Committee Report shall be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended (the Securities Act), or the Securities Exchange Act of 1934, as amended (the Exchange Act), through any general statement incorporating by reference in its entirety the proxy statement in which this Report appears, except to the extent that the Company specifically incorporates this

 

 

 

MetLife 2016 Proxy Statement    

 

 

 

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Table of Contents

 

LOGO     

      Audit Committee Report

 

report or a portion of it by reference. In addition, this report shall not be deemed to be “soliciting material” or to be “filed” under either the Securities Act or the Exchange Act.

The Audit Committee currently consists of five independent Directors who satisfy the audit committee independence standards of the SEC and the NYSE. The Audit Committee, on behalf of the Board, is responsible for overseeing management’s conduct of MetLife’s financial reporting processes and audits of the Company’s financial statements, the adequacy of the Company’s internal control over financial reporting and the appointment, retention, performance and compensation of the Company’s independent auditor. More information on the Audit Committee and its qualifications and responsibilities is included elsewhere in the proxy statement and in the Audit Committee Charter on the Company’s website at www.metlife.com/corporategovernance.

Management is responsible for the preparation of MetLife’s consolidated financial statements and the reporting process. Deloitte & Touche LLP (Deloitte), as MetLife’s independent auditor, is responsible for auditing MetLife’s consolidated financial statements in accordance with auditing standards of the Public Company Accounting Oversight Board (United States) (PCAOB).

Deloitte has discussed with the Audit Committee those matters described in the PCAOB Standard, Communications with Audit Committees (AU 380), Auditing Standard No. 16, and Rule 2-07 of Regulation S-X promulgated by the Securities and Exchange Commission. Deloitte has also provided to the Audit Committee the written disclosures and the letter required by applicable requirements of the PCAOB regarding Deloitte’s communications with the Audit Committee concerning independence, and the Audit Committee has discussed with Deloitte its independence from MetLife.

During 2015, management updated its internal control documentation for changes in internal control and completed its testing and evaluation of MetLife’s system of internal control over financial reporting in response to the requirements set forth in Section 404 of the Sarbanes-Oxley Act of 2002 and related regulations. In doing so, management utilized the criteria established in the Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Audit Committee was kept

apprised of the progress of the evaluation and provided oversight and advice to management during the process. In connection with this oversight, the Audit Committee received updates provided by management and Deloitte at each regularly scheduled Audit Committee meeting and met in executive session separately with the internal and the independent auditor to discuss the results of their examinations, observations and recommendations regarding internal control over financial reporting. The Audit Committee also reviewed the report of management’s assessment of the effectiveness of internal control over financial reporting contained in the Company’s 2015 Annual Report on Form 10-K, which has been filed with the Securities and Exchange Commission (the 2015 Form 10-K). The Audit Committee also reviewed Deloitte’s report regarding its audit of the effectiveness of the Company’s internal control over financial reporting.

The Audit Committee reviewed and discussed with management, and with Deloitte, MetLife’s audited consolidated financial statements for the year ended December 31, 2015 and Deloitte’s Report of Independent Registered Public Accounting Firm dated February 24, 2016 regarding the 2015 audited consolidated financial statements included in the 2015 Form 10-K. The Deloitte report states that MetLife’s 2015 audited consolidated financial statements present fairly, in all material respects, the consolidated financial position of MetLife and its subsidiaries as of December 31, 2015 and 2014 and the results of their operations and cash flows for each of the three years in the period ended December 31, 2015 in conformity with accounting principles generally accepted in the United States of America. In reliance upon the reviews and discussions with management and Deloitte described in this Audit Committee Report, and the Board of Directors’ receipt of the Deloitte report, the Audit Committee recommended to the Board that MetLife’s 2015 audited consolidated financial statements be included in the 2015 Form 10-K.

Respectfully,

Kenton J. Sicchitano, Chair

Cheryl W. Grisé

Alfred F. Kelly, Jr.

Edward J. Kelly, III

Catherine R. Kinney

 

 

 

 

 

 

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    MetLife 2016 Proxy Statement

 


Table of Contents
PROPOSAL 4 — Advisory Vote to Approve the Compensation Paid to the Company’s Named Executive Officers      

 

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PROPOSAL 4 — ADVISORY VOTE TO APPROVE THE COMPENSATION PAID TO THE COMPANY’S NAMED EXECUTIVE OFFICERS

 

 

LOGO

    

The Board of Directors recommends that you vote FOR this proposal: “RESOLVED, that the compensation paid to the Company’s Named Executive Officers, as disclosed pursuant to the compensation disclosure rules of the Securities and Exchange Commission, including the Compensation Discussion and Analysis, compensation tables and narrative discussion, is hereby APPROVED.”

 

 

In accordance with Section 14A of the Exchange Act, this proposal will give shareholders the opportunity to endorse or not endorse the Company’s executive compensation programs and policies and the resulting compensation for the individuals listed in the Summary Compensation Table on page 69 (the Named Executive Officers or NEOs), as described in this Proxy Statement.

The Compensation Committee will take into account the outcome of the vote when considering future compensation arrangements. Because the vote is advisory, the result will not be binding on the Compensation Committee and it will not affect, limit, or augment any existing compensation or awards.

The Board has approved an annual frequency for shareholder votes to approve executive officer compensation. As a result, unless the Board determines otherwise, the next such vote will be held at the Company’s 2017 Annual Meeting. The Company also anticipates that, unless the Board determines otherwise, management will next ask shareholders in 2017 to vote on their preference for the frequency of such votes.

The Compensation Committee and Board of Directors believe that the Company’s compensation programs and policies, and the compensation of the Named Executive Officers, promote the Company’s business objectives with appropriate compensation delivered in appropriate forms. See the Compensation Discussion and Analysis, beginning on page 42. Accordingly, the Board of Directors recommends that you vote FOR this proposal.

Compensation Committee Report

This report is furnished by the Compensation Committee of the MetLife, Inc. (MetLife or the Company) Board of Directors. The Compensation Committee has reviewed and discussed with management the Compensation Discussion and Analysis that is set forth on pages 42 through 68 of the Company’s 2016 Proxy Statement and, based on such review and discussion, the Compensation Committee recommended to the Board of Directors that such Compensation Discussion and Analysis be included in the 2016 Proxy Statement and incorporated by reference in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015.

No portion of this Compensation Committee Report shall be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended (the Securities Act), or the Securities Exchange Act of 1934, as amended (the Exchange Act), through any general statement incorporating by reference in its entirety the proxy statement in which this Report appears, except to the extent that the Company specifically incorporates this report or a portion of it by reference. In addition, this report shall not be deemed to be “soliciting material” or to be “filed” under either the Securities Act or the Exchange Act.

Respectfully,

James M. Kilts, Chair

Cheryl W. Grisé

Alfred F. Kelly, Jr.

Denise M. Morrison

Kenton J. Sicchitano

 

 

 

MetLife 2016 Proxy Statement    

 

 

 

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Table of Contents

 

LOGO     

      Compensation Discussion and Analysis

 

Compensation Discussion and Analysis

The Compensation Discussion and Analysis describes the objectives and policies underlying MetLife’s executive compensation program for the Named Executive Officers and the rest of the Executive Group. It also describes the key factors that the Compensation Committee considered in determining the compensation of the members of the Executive Group.

 

      

LOGO

 

 

How did we perform?

 

    
 

Highlights of 2015 Business Results

  

 

 

 

 

43

 

 

  

 

 
 

Highlights of Executive Performance and Compensation

  

 

 

 

 

46

 

 

  

 

 
      

LOGO

 

 

What are our executive compensation practices?

 

    
 

Key Features of MetLife’s Executive Compensation Program

  

 

 

 

 

48

 

 

  

 

 
 

Compensation Philosophy and Objectives

  

 

 

 

 

49

 

 

  

 

 
 

Overview of Compensation Program

  

 

 

 

 

49

 

 

  

 

 
 

2015 Say-on-Pay Vote and Shareholder Engagement

  

 

 

 

 

49

 

 

  

 

 
      
LOGO  

 

How do we assess performance and determine compensation?

 

    
 

Peer Compensation Comparisons

  

 

 

 

 

51

 

 

  

 

 
 

Components of Compensation and Benefits

  

 

 

 

 

53

 

 

  

 

 
 

Determining Total Compensation for 2015 Performance

  

 

 

 

 

54

 

 

  

 

 
      

LOGO

 

 

How did we compensate our CEO and other NEOs?

 

    
 

Base Salary

  

 

 

 

 

55

 

 

  

 

 
 

Annual Incentive Awards

  

 

 

 

 

55

 

 

  

 

 
 

Stock-Based Long-Term Incentive Awards

  

 

 

 

 

59

 

 

  

 

 
 

Retirement and Other Benefits

  

 

 

 

 

62

 

 

  

 

 
 

Potential Payments

  

 

 

 

 

64

 

 

  

 

 
      

LOGO

 

 

How do we manage risk related to our compensation program?

 

    
 

Risk Management

  

 

 

 

 

66

 

 

  

 

 
 

Executive Share Ownership

  

 

 

 

 

66

 

 

  

 

 
 

Equity Award Timing Practices

  

 

 

 

 

67

 

 

  

 

 
 

Performance-Based Compensation Recoupment Policy

  

 

 

 

 

67

 

 

  

 

 
 

Policies Prohibiting Hedging or Pledging Company Securities

  

 

 

 

 

67

 

 

  

 

 
 

Tax Considerations

  

 

 

 

 

67

 

 

  

 

 
 

Accounting Considerations

  

 

 

 

 

68

 

 

  

 

 

 

 

 

 

 

                 42    

 

 

  

 

 

 

    MetLife 2016 Proxy Statement

 


Table of Contents
Compensation Discussion and Analysis      

 

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LOGO

 

Highlights of 2015 Business Results 

In 2015, under the leadership of Chief Executive Officer Steven A. Kandarian, the Company continued to implement its strategy of refocusing the U.S. business, building the global employee benefits business, growing emerging markets, and driving toward customer centricity and a global brand. Among other achievements, MetLife continued to manage variable annuity sales, increase global voluntary worksite benefits sales, increase Operating Earnings from emerging markets, and increase multinational and expatriate sales.

All of the Company’s major decisions are being informed by the need to generate Free Cash Flow and return capital to shareholders. The Company increased Free Cash Flow proportionate to Operating Earnings and total returns to shareholders in 2015.

MetLife began efforts in 2015 that will lead to bold actions to accelerate value. The Company is planning to separate its U.S. Retail business to produce capital relief. It has also reached an agreement to divest its captive agent channel, which will generate savings. As a result, any new, separate U.S. retail company would have the opportunity to compete more effectively and generate stronger returns for shareholders, benefiting from greater focus, more flexibility, and a reduced compliance and capital burden.

The Compensation Committee’s decisions on the active Named Executive Officers’ compensation for 2015 reflected its view of the Company’s performance and each executive’s performance relative to his goals and other challenges and opportunities that arose in 2015. In granting compensation, it continued to emphasize variable performance-based pay over fixed pay, and allocated higher proportions of incentive compensation to stock-based long-term opportunities than to annual cash awards.

 

 

 

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Table of Contents

 

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      Compensation Discussion and Analysis

 

In 2015, under the leadership of Mr. Kandarian and the Executive Group, the Company achieved the results shown in the following table compared to its Business Plan. The Company’s 2014 results and 2014 Business Plan are included for reference.

(The following performance measures are not calculated based on GAAP. They should be read in conjunction with Appendix A to this Proxy Statement, which includes non-GAAP financial information, definitions and/or reconciliations to the most directly comparable measures that are based on GAAP.)

 

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  LOGO    LOGO  
 

LOGO

 

  

 

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    MetLife 2016 Proxy Statement

 


Table of Contents
Compensation Discussion and Analysis      

 

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1 The 2015 results of Operating Earnings, Operating EPS, Operating ROE, Operating Expense Ratio, Book Value Per Share and Free Cash Flow as a Percentage of Operating Earnings have been adjusted to exclude a non-cash charge of $792 million, net of income tax, related to an uncertain tax position comprised of a $557 million charge included in provision for income tax expense and a $362 million charge ($235 million net of income tax) included in other expenses. This non-cash charge is related to tax years 2000 to 2009 for a wholly-owned U.K. subsidiary, as disclosed by the Company on Form 8-K on September 16, 2015. The charge was the result of the Company’s consideration of court decisions upholding the U.S. Internal Revenue Service’s disallowance of foreign tax credits claimed by corporate entities not affiliated with the Company. Resolution of the Company’s own foreign tax credits awaits filing of (and determinations regarding) refund claims. Unadjusted, these amounts would be $5,484 million, $4.86, 9.7%, 24.1%, $51.15 and 73%, respectively.

 

2 The 2015 Business Plan called for relatively flat Operating Earnings and lower Operating ROE than did the 2014 Business Plan. The Company uses consensus economic assumptions for interest rates and foreign currency exchange rates when setting the Business Plan each year. The consensus interest rates were lower for the 2015 Business Plan then they had been for the 2014 Business Plan, and the consensus strength of the U.S. dollar was higher. Lower interest rates have a negative impact on our interest margins. Those margins, and a strong U.S. dollar, have a negative impact on Operating Earnings and Operating ROE.

 

3 The 2014 Business Plan did not include this item.

 

4 The percentage presented for the 2015 Business Plan is the mid-point of the Business Plan range.

 

 

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Highlights of Executive Performance and Compensation

MetLife maintained its commitment to its pay for performance philosophy in 2015. The Compensation Committee’s decisions on the active Named Executive Officers’ compensation reflected its view of the Company’s performance and each executive’s performance relative to his goals and other challenges and opportunities that arose in 2015. The active Named Executive Officers in this Proxy Statement are:

 

  Chairman of the Board, President and Chief Executive Officer Steven A. Kandarian;

 

  Executive Vice President and Chief Financial Officer John C. R. Hele;

 

  Executive Vice President, Global Technology & Operations Martin J. Lippert;
  Executive Vice President and Chief Investment Officer Steven J. Goulart; and

 

  President, Asia Christopher G. Townsend.
 

 

Under the leadership of Mr. Kandarian and his Executive Group, the Company had a strong year of performance on strategic and operational matters, and delivered financial performance despite regulatory uncertainty, low interest rates and a strong U.S. dollar. In the face of these and other challenges, MetLife was able to deliver business growth and return more than 50% of normalized Operating Earnings to its shareholders in the form of dividends and buybacks.

The Compensation Committee approved an AVIP Performance Funding Level of 98.1% as described on page 56. The aspects of individual performance the Compensation Committee considered in making individual incentive decisions are discussed starting on page 56.

Incentive Compensation Decisions for 2015 Performance

The following table reflects the compensation actions (AVIP and stock-based long-term incentive (LTI) awards) the Compensation Committee approved for each active NEO in February 2016 based on 2015 performance, as well as base salary paid during 2015. While this table is not a substitute for the Summary Compensation Table on page 69, it provides a holistic view of compensation decisions for performance year 2015.

 

    Name           Base Salary(1)             AVIP Award(1)             LTI(2)             Total Compensation(3)      
 

Steven A. Kandarian

        $1,425,000            $4,500,000            $10,500,000            $16,425,000     
 

John C.R. Hele

        $   706,250            $2,200,000            $  3,000,000            $  5,906,250     
 

Martin J. Lippert

        $   681,250            $2,300,000            $  2,800,000            $  5,781,250     
 

Steven J. Goulart

        $   637,500            $1,400,000            $  2,500,000            $  4,537,500     
 

Christopher G. Townsend

        $   587,500            $1,100,000            $  1,800,000            $  3,487,500     

 

1 See the Summary Compensation Table on page 69 for details.
2 Reflects the 2016 LTI award value, not the “grant date fair value” calculated in accordance with the applicable accounting standard, ASC 718. The grant date fair value will be disclosed for any Named Executive Officers who are reported in the Summary Compensation Table in the Company’s 2017 Proxy Statement.
3 In addition to the differences described above, Total Compensation excludes amounts in the Change in Pension Value and Nonqualified Deferred Compensation Earnings and All Other Compensation columns of the Summary Compensation Table.

In addition to each executive’s accomplishments against individual goals for the year, all compensation decisions were made within the context of MetLife’s executive compensation programs and guidelines and internal equity considerations, as well as alignment and appropriate competitive positioning against external market peers. LTI awards reflect individual performance as well as expectations of contributions to future performance.

Additional details on individual performance and 2015 incentive decisions are provided underAnnual Incentive Awards” on page 55.

 

 

 

 

 

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(As shown also on page 6.)

 

Chief Executive Officer Compensation

for 2015 Performance

 

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Other Executive Group Members’

Compensation for 2015 Performance as a Whole

 

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Most of the Company’s Executive Officers’ Total Compensation for 2015 performance was variable and depended on performance. In addition, the Compensation Committee allocated a greater portion of the Executive Group members’ variable compensation to stock-based long-term incentives than to annual cash incentives. These long-term incentives align executive and shareholder interests and encourage future contributions to performance. Ultimately, the value of long-term incentives depends on future Company performance, including stock price performance.

The Company’s stock-based long-term incentives are comprised of Performance Shares, Restricted Stock Units, Stock Options, and, in some cases with respect to Executive Group members outside the United States, cash payable equivalents. MetLife determines the number of Performance Shares and Restricted Stock Units (and cash payable equivalents) in each award by dividing that portion of the LTI award value by the Share closing price on the grant date, and the number of Stock Options (and cash-payable equivalents) in the award by dividing that portion of the LTI award value by one-third of the Share closing price on the grant date. If the Share closing price on the grant date is outside a 15% range (higher or lower) of the average Share closing price for the year to date, MetLife uses that average closing price instead of the closing price on the grant date. Regardless, the exercise price of Stock Options is the closing price on the grant date.

The Company’s long-term performance, including changes to the price of Shares, has a significant impact on the Named Executive Officers’ compensation.

 

 

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Key Features of MetLife’s Executive Compensation Program

 

              
   

 

MetLife’s compensation program has multiple features

that promote the Company’s success, including:

 

   
      
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paying for performance: most compensation is variable without guarantee, and dependent on achievement of business results.

 

 
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aligning executives’ interests with those of shareholders: most incentive compensation is stock-based, and executives are expected to meet Share ownership guidelines.

 

 
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encouraging long-term decision-making: Stock Options and Restricted Stock Units vest over three years, Stock Options may normally be exercised over 10 years, and the ultimate value of Performance Shares is determined by the Company’s performance over three years.

 

 
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rewarding achievement of the Company’s business goals: amounts available for annual incentive awards are based on Company performance compared to its Business Plan; individual awards take account of individual executive performance relative to individual goals.

 

 
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avoiding incentives to take excessive risk: the Company does not make formulaic awards as part of its normal program, uses Operating Earnings (which excludes net investment gains and losses and net derivative gains and losses) as a key performance indicator, and uses multi-year performance to determine the ultimate value of stock-based awards.

 

 
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maintaining a performance-based compensation recoupment (clawback) policy: the Company may seek recovery for employee fraudulent or other wrongful conduct that harmed MetLife.

 

 
              

 

              
   

 

The Company’s compensation program excludes practices

that would be contrary to the Company’s compensation

philosophy and contrary to shareholders’ interests.

For example, the Company:

 

   
      
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does not offer Executive Group members a supplemental executive retirement plan that provides benefits under a different formula than the generally-applicable pension plan, or that adds to years of service or includes long-term incentive compensation in the benefits formula.

 

 
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does not provide excessive perquisites.

 

 
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does not allow repricing or replacing of Stock Options without prior shareholder approval.

 

 
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does not provide any “single trigger” change-in-control severance pay, or “single trigger” vesting of stock-based awards upon a change-in-control without the opportunity for the Company or a successor to substitute alternative awards that remain subject to vesting.

 

 
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does not provide any change-in-control severance pay beyond two times average pay.

 

 
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does not provide for any excise tax payment or tax gross-up for change-in-control related payments, or for tax gross-up for any perquisites or benefits, other than in connection with relocation or other transitionary arrangements when an Executive Group member begins employment.

 

 
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does not allow directors, executives, or other associates, to engage in pledging, hedging, short sales, or trading in put and call options with respect to the Company’s securities.

 

 
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does not offer employment contracts to U.S.-based Executive Group members.

 

 
              
 

 

 

 

 

 

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Compensation Philosophy and Objectives

MetLife’s executive compensation program is designed to:

 

  provide competitive Total Compensation opportunities that will attract, retain, engage, and motivate high-performing executives;

 

  align the Company’s compensation plans with its short- and long-term business strategies;

 

  align the financial interests of the Company’s executives with those of its shareholders through stock-based incentives and Share ownership requirements; and

 

  reinforce the Company’s pay for performance culture by making a significant portion of Total Compensation variable, and differentiating awards based on Company and individual performance.

Overview of Compensation Program

MetLife uses competitive total compensation guidelines that consists of base salary, annual incentive awards and stock-based long-term incentive award opportunities. The Compensation Committee considers and recommends the amount of each of these three elements together. It submits its recommendations for the Company’s Chief Executive Officer for approval by the Independent Directors, and for each of the other Executive Group members for approval by the Board of Directors. For purposes of this discussion and MetLife’s compensation program, Total Compensation for an Executive Group member means the total of only these three elements. Items such as sign-on payments and others that are not determined under the Company’s general executive compensation practices are approved by the Compensation Committee, but are generally not included in descriptions of Total Compensation.

The Compensation Committee’s Total Compensation decisions are driven by performance. Each Executive Group member’s Total Compensation reflects the Compensation Committee’s assessment of the Company’s and the executive’s performance as well as competitive market data based on peer compensation comparisons. Decisions on the award or payment amount of one element of Total Compensation impact the decisions on the amount of other elements. The Compensation Committee’s Total Compensation approach means that it does not structure particular elements of Total Compensation to relate to separate individual goals or performance.

The Compensation Committee allocates a greater portion of the Executive Group members’ Total Compensation to variable components that depend on performance or the value of Shares rather than a fixed component. It also allocates a greater portion of the Executive Group members’ variable compensation to stock-based long-term incentives than it allocates to annual cash incentives. Given this mix of pay and other features of MetLife’s compensation programs, Executive Group members’ interests are aligned with those of shareholders. Further, the Company’s Share ownership guidelines are designed to align executives’ interests with those of shareholders and reinforce the focus on long-term shareholder value.

The Compensation Committee also reviews other compensation and benefit programs, such as retirement benefits and potential payments that would be made if an Executive Group member’s employment were to end. Benefits such as retirement and medical programs do not impact Total Compensation decisions since they apply to substantially all employees. Nor do decisions about those benefits vary based on decisions about an Executive Group member’s base salary or annual or stock-based awards, or the amount realizable from prior awards.

The Compensation Committee’s independent executive compensation consultant, Meridian, assisted it in its design and review of the Company’s compensation program. For more information on the role of Meridian regarding the Company’s executive compensation program, see “Corporate Governance —Board and Committee Information — Compensation Committee” beginning on page 29.

Generally, the forms of compensation and benefits provided to Executive Group members in the United States are similar to those provided to other U.S.-based officer-level employees. None of the Executive Group members based in the United States is a party to any agreement with the Company that governs the executive’s employment.

2015 Say-on-Pay Vote and Shareholder Engagement

In 2015, over 98% of the Company’s shareholders voted to approve the Company’s executive compensation programs and policies and the resulting compensation described in the 2015 Proxy Statement (based on Shares voted).

Because the vote was advisory, the result was not binding on the Compensation Committee. However, the Compensation

 

 

 

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Committee considered the vote to be an endorsement of the Company’s executive compensation programs and policies, and took into account that support in reviewing those programs and policies. The Company has also discussed the vote, along with aspects of its executive compensation and corporate governance practices, with a number of shareholders to gain a deeper understanding of their perspectives. None of these discussions

raised shareholder concerns about the Company’s current compensation practices. The Company’s practices and disclosure were well received by shareholders, who conveyed their views that the performance metrics the Company uses are fitting and that our disclosure communicates effectively how the Compensation Committee uses its judgment.

 

 

 

 

 

 

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Peer Compensation Comparisons

The Compensation Committee periodically reviews the competitiveness of MetLife’s Total Compensation guidelines using data reflecting a comparator group of companies in the insurance and broader financial services industries with which MetLife competes for executive talent (the Comparator Group).

The Compensation Committee chose the members of the Comparator Group based on the size of the firms relative to MetLife and the extent of their global presence or their similarity to MetLife in the importance of investment and risk management to their business, as well as being competitors for executive talent. It reviews the composition of the Comparator Group from time to time to ensure that the group remains an appropriate comparison for the Company. The Compensation Committee changed the group in 2015, adding American International Group considering its similar global businesses, scope and complexity. The resulting Comparator Group consists of the 19 financial services companies listed.

 

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See Appendix B for further details.

 

In determining the Executive Group member’s Total Compensation for 2015, the Compensation Committee considered the increasingly global nature of the Company’s business and the Company’s size, scope, and complexity relative to its peers, the challenges the Executive Group faces, and the Compensation Committee’s expectations for the executive’s and the Company’s performance. MetLife’s competitive compensation philosophy is generally to provide Total Compensation around the size-adjusted median for like positions at Comparator Group companies, taking into account MetLife’s assets, revenue, and market capitalization relative to other companies in the Comparator Group. As a result, the Compensation Committee considered an Executive Group

member’s Total Compensation to be competitive if it fell within a reasonable range of that size-adjusted median. Total Compensation for individual Executive Group members also varies based on individual factors such as performance, expectations of contributions to future performance, experience, and retention considerations. The Compensation Committee reviewed individual elements of the Executive Group members’ Total Compensation in comparison to available Comparator Group data, with a primary focus on Total Compensation. For 2015 performance, each Named Executive Officer’s Total Compensation fell between 80% and 120% of the point representing the size-adjusted median for his position.

 

 

 

 

 

 

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Components of Compensation and Benefits

The primary components of the Company’s regular executive compensation and benefits program play various strategic roles:

 

         
   

 

Description

 

         

 

Strategic Role

 

   
         
   

 

Total Compensation

 

   
         
 

Base Salary is determined based on position, scope of responsibilities, individual performance, and competitive data.

 

      Provides fixed compensation for services during the year.  
 

Annual Incentive Awards are:

•    variable based on performance relative to Company and individual goals and additional business challenges or opportunities that arose during the year.

• determined by the Compensation Committee using its judgment of all of these factors as a whole, and not by using a formula.

 

     

•    Serve as the primary compensation vehicle for recognizing and differentiating individual performance each year.

•    Motivate Executive Group members and other employees to achieve strong annual business results that will contribute to the Company’s long-term success, without creating an incentive to take excessive risk.

 
 

Stock-Based Long-Term Incentive Awards are:

•    based on the Compensation Committee’s assessment of individual responsibility, performance, relative contribution, and potential for assuming increased responsibilities and future contributions.

•    dependent on the value of Shares (Restricted Stock Units), increases in the price of Shares (Stock Options), or a combination of MetLife’s performance as well as the value of Shares (Performance Shares). Cash-paid equivalents are used outside the U.S.

•    for awards to Executive Group members made as part of Total Compensation for prior year performance and in expectation of contributions to future performance granted in these proportions:

     

•    Ensure that Executive Group members have a significant continuing stake in the long-term financial success of the Company (see “Executive Share Ownership” on page 66).

•    Align executives’ interests with those of shareholders.

•    Encourage decisions and reward performance that contribute to the long- term growth of the Company’s business and enhance shareholder value.

•    Motivate Executive Group members to outperform MetLife’s competition.

•    Encourage executives to remain with MetLife.

 
 

 

Stock-Based Long-Term

Incentive Mix for Executive Group Members

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Benefits

 

   
         
 

Retirement Program and Other Benefits include post-retirement income (pension) or the opportunity to save a portion of current compensation for retirement and other future needs (savings and investment program and nonqualified deferred compensation).

 

      Attract and retain executives and other employees.  
         
   

 

Potential Payments

 

   
 

 

Severance Pay and Related Benefits include transition assistance if employment ends due to job elimination or, in limited circumstances, performance.

 

     

Encourage focus on transition to other opportunities and allow the Company to obtain a release of employment-related claims.

 

 
 

Change-in-Control Benefits include:

•    replacement or vesting of stock-based long-term incentive awards.

•    double-trigger severance pay and related benefits, if the Executive Group member’s employment is terminated without cause or the Executive Group member resigns with good reason following a change-in-control.

 

     

•    Retain Executive Group members through a change-in-control and allow executives to act in the best interests of shareholders without distractions due to concerns over personal circumstances.

•    Promote the unbiased efforts of the Executive Group members to maximize shareholder value during and after a change-in-control.

•    Keep executives whole in situations where Shares may no longer exist or awards otherwise cannot or will not be replaced.

 
         

 

 

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Determining Total Compensation for 2015 Performance

In determining executive compensation for performance year 2015, the Compensation Committee considered the Executive Group’s performance both as a whole and individually. The Compensation Committee also reviewed reports and analyses on competitive compensation for comparable positions at peer companies and in the broader market where the Company competes for executive talent.

A description of the process for determining Total Compensation follows.

Process for Determining Chief Executive Officer Compensation. Early in 2015, Mr. Kandarian and the Compensation Committee established goals and objectives that were designed to drive Company performance. For a description of these goals, see “Annual Incentive Awards” beginning on page 55.

In early 2016, the Compensation Committee approved and recommended Mr. Kandarian’s Total Compensation for 2015, including annual and stock-based long-term incentives, to the Independent Directors for their approval. The Compensation Committee’s Total Compensation recommendations for 2015 reflected its assessment of MetLife’s and Mr. Kandarian’s performance against goals.

Mr. Kandarian’s compensation is higher than other Executive Group members due to Mr. Kandarian’s broader responsibilities and higher levels of accountability as the most senior executive in the Company, as well as competitive market data.

Process for Determining Compensation of Other Executive Group Members. Early in 2015, Mr. Kandarian and each Executive Group member agreed on the respective executive’s goals for 2015. In early 2016, Mr. Kandarian provided to the Compensation Committee an assessment of each of the Executive Group members’ performance during 2015 relative to their goals and the additional business challenges and opportunities that arose during the year. He also recommended Total Compensation amounts for each Executive Group member, other than himself. The Compensation Committee reviewed these recommendations. It approved and endorsed the components of each Executive Group member’s Total Compensation for the Board of Directors’ approval. In each case, Mr. Kandarian and the Compensation Committee considered the executive’s performance, future potential, available competitive data, compensation opportunities for each position, retention needs, and fit within the executive talent market, aligned with MetLife’s compensation philosophy and objectives.

The Executive Vice President and Chief Human Resources Officer of the Company (the CHRO) provided the Compensation Committee with advice and recommendations on the form and overall level of executive compensation. He also provided guidance and information to Mr. Kandarian to assist him in this process, other than with respect to the CHRO’s own compensation. The CHRO also provided guidance to the Compensation Committee on its general administration of the programs and plans in which Executive Group members, as well as other employees, participate.

Other than as described above, no Executive Group member played a role in determining the compensation of any of the other Executive Group members. No Executive Group member took part in the Board’s consideration of his or her own compensation.

 

 

 

 

 

 

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Base Salary

The base salaries earned by the Named Executive Officers in 2015 are reported in the Summary Compensation Table on page 69. The Compensation Committee approved the following base salary increases, effective April 1, 2015. The new annual salary rates were approved in light of these officers’ levels of responsibility and their performance, and to better align their salaries with the targeted compensation position relative to the Comparator Group.

 

   

Name

 

         

 

Former Salary Rate

 

       

 

New Salary Rate

 

 
 

Steven A. Kandarian

        $1,350,000          $1,450,000   
 

John C. R. Hele

        $   650,000          $   725,000   
 

Martin J. Lippert

        $   625,000          $   700,000   
 

Steven J. Goulart

        $   600,000          $   650,000   
 

Christopher G. Townsend1

        $   548,939          $   600,000   

 

1 See footnote 1 on page 69 regarding currency exchange rate.

Annual Incentive Awards

The MetLife Annual Variable Incentive Plan (AVIP) provides eligible employees, including the Executive Group members, the opportunity to earn annual cash incentive awards. For awards for 2015 performance, AVIP was administered as a Cash-Based Awards program under the MetLife, Inc. 2015 Stock and

Incentive Compensation Plan (2015 Stock and Incentive Plan). The 2015 AVIP awards are reported in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table on page 69.

Each year, the Compensation Committee approves the maximum aggregate amount available for all AVIP awards for substantially all administrative (non-sales) employees around the world, approximately 35,500 employees for 2015.

Consistent with past practice, this approach uses an AVIP Performance Funding Level, based on the Company’s Operating Earnings compared to the Company’s 2015 Business Plan, multiplied by the total annual incentive compensation planning targets for all covered employees, subject to the Compensation Committee’s assessment of overall performance and other relevant factors. For this purpose, the Company’s Operating Earnings is adjusted to eliminate the impact (if any) of variable investment income on an after-tax basis that was higher or lower than the Business Plan goal by 10% or more (Adjusted Operating Earnings). The guidelines to determine the AVIP Performance Funding Level are outlined in the following chart, indicating how the guideline Performance Funding Level changes relative to Adjusted Operating Earnings performance:

 

 

 

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Total AVIP Funding for Awards to All Eligible Employees

 

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See Appendix B for further details.

 

This formula avoids providing employees with an incentive to take excessive risk through several of its features. Operating Earnings excludes net investment gains and losses and net derivative gains and losses. The exclusion of after-tax variable investment income outside the 10% range higher or lower than the Business Plan goal also avoids providing rewards or penalties for volatile investment returns. As a result, the formula does not provide an incentive to take excessive risk in the Company’s investment portfolio. Nor is the formula an unlimited function of revenues. Rather, the formula caps the amount that can be generated for AVIP awards, and is a function of financial measures that account for the Company’s costs and liabilities.

For 2015 AVIP, the Compensation Committee determined that the amount of Operating Earnings would exclude a non-cash charge of $792 million, net of income tax, related to tax years 2000 to 2009 for a wholly-owned U.K. subsidiary of MLIC. The charge was the result of the Company’s consideration of court decisions upholding the U.S. Internal Revenue Service’s disallowance of foreign tax credits claimed by corporate entities not affiliated with the Company. The Compensation Committee chose to exercise its discretion to exclude this charge because it did not relate to the consequences of any current management decisions and management did not meaningfully benefit from

the tax credit in past compensation determinations. Resolution of the Company’s own foreign tax credits awaits filing of (and determinations regarding) refund claims. The Company expects that, if the charge is later reversed, it will exclude that reversal from its determination of Operating Earnings for applicable executive compensation purposes.

The Compensation Committee determined the Executive Group members’ 2015 AVIP awards and long-term incentive awards in consideration of the Company’s key financial performance goals

and results as discussed on page 44. The Compensation Committee also considered aspects of each executive’s performance in light of their objectives, which aligned with the Company’s strategic goals.

A description of the key aspects of each of the Named Executive Officers’ performance relative to their objectives follows.

Aspects of Individual Performance

(The following performance measures are not calculated based on GAAP. They should be read in conjunction with Appendix A to this Proxy Statement, which includes non-GAAP financial information, definitions and/or reconciliations to the most directly comparable measures that are based on GAAP.)

 

 

 

 

 

 

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Steven A. Kandarian, Chairman of the Board, President and Chief Executive Officer

Under Mr. Kandarian’s leadership, the Company made strong progress on multiple strategic and operational initiatives that the Company expects to drive long-term shareholder value. In addition, the Company delivered financial performance under challenging circumstances. MetLife reported 2015 Operating Earnings of $5.5 billion, down 16% over 2014, and 12% on a constant currency basis. On a per Share basis, 2015 Operating Earnings were $4.86, down 15% over 2014. Operating ROE was 9.7% for 2015, compared to 12.0% for 2014. This decrease in Operating Earnings reflects a strong U.S. dollar, lower variable investment income, and a previously announced third quarter 2015 non-cash charge of $792 million related to the tax treatment of a wholly-owned U.K. subsidiary of MLIC.

Adjusting for total notable items (including the third quarter 2015 non-cash charge) in 2015 and 2014:

 

  Operating Earnings were $6.4 billion, down 1% over 2014, but up 3% on a constant currency basis; and

 

  Operating ROE was 11.3% for 2015, or approximately 900 basis points above the risk-free rate as represented by the 10-year Treasury at year-end 2015.

The Company’s 2015 achievements included the following:

 

  Significantly advanced the Accelerating Value strategic initiative to increase sustainable Free Cash Flow and improve Total Shareholder Return.

 

  Completed all analysis and preparatory work leading to the Company’s recently announced plans to separate the U.S. Retail business and sell the MetLife Premier Client Group to MassMutual.

 

  Strengthened its Free Cash Flow yield from Operating Earnings to 63% (excluding the third quarter 2015 non-cash charge), up from 44% in 2014, 36% in 2013, and 26% in 2012.

 

  Successfully advocated for a more level playing field between New York and other states, allowing MLIC to significantly boost its dividend capacity over the next three years while maintaining strong capitalization levels.
  Sought judicial review of the Company’s designation as a Systemically Important Financial Institution to protect the enterprise from competitive harm; effectively advocated the Company’s point of view with regulators, legislators and the news media.

 

  Exceeded goals for organizational health, talent management, and enterprise succession bench strength.

 

  Effectively communicated MetLife’s value proposition to investors, leading to Mr. Kandarian being named the number 1 Buy-Side CEO on Institutional Investor’s “All-America Executive Team.”

 

  Achieved recognition for MetLife as the number 1 life and health insurer in Fortune magazine’s 2015 survey of the “World’s Most Admired Companies” for the first time in Company history.

In assessing Mr. Kandarian’s compensation, the Compensation Committee considered Mr. Kandarian’s performance against goals for 2015 as well as a competitive assessment of compensation relative to peers and the Company’s established compensation philosophy. His AVIP award for 2015 is less than for 2014 to reflect the Company’s financial performance, while his stock-based long-term incentive award for 2015 is greater than for 2014 to strengthen alignment of incentives with market, and recognize notable progress on strategic initiatives that the Company expects to drive shareholder returns over time.

The Compensation Committee believes Mr. Kandarian’s Total Compensation appropriately reflects the Company’s target competitive position.

John C.R. Hele, Executive Vice President and Chief Financial Officer

In addition to reviewing performance against goals and market data, Mr. Kandarian and the Compensation Committee considered the depth, breadth and pace of Mr. Hele’s progress on important strategic initiatives. His AVIP award and stock-based long-term incentive award for 2015 are the same as for 2014, reflecting consistent performance in a challenging environment and appropriate competitive positioning.

 

 

 

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In determining Mr. Hele’s compensation the Compensation Committee considered that, under Mr. Hele’s leadership, the Company delivered financial performance under challenging circumstances as well as the following:

 

  MetLife maintained key capital adequacy ratios above minimum targets based on current regulations, exceeded Free Cash Flow goals, and successfully interacted with rating agencies in 2015 in support of maintaining targeted ratings.

 

  Mr. Hele played a key role in all corporate transactions, co-leads the Accelerating Value initiative to increase sustainable Free Cash Flow, and continued to lead the development and reporting of Embedded Value metrics upon which Accelerating Value is based. The Company’s January 2016 press release announcing the plan to pursue the separation of a substantial portion of its U.S. Retail segment was due, in part, to this initiative.

 

  He developed a comprehensive process to support MetLife’s transition to federal regulation as a non-bank SIFI to ensure compliance even while pursuing regulatory relief.

 

  Mr. Hele led the MetLife advocacy of insurance capital rules with global and national regulators, industry associations, and global insurance companies.

 

  He played a leading role communicating MetLife’s value proposition to our global investor community, through meetings with shareholders and investor firms. Mr. Hele was recognized as Institutional Investor Magazine’s 2015 Best Chief Financial Officer in U.S. Insurance (number 1 buy-side); further, his Investor Relations organization was recognized as 2015’s Best Investor Relations in U.S. Insurance (number 1 buy-side).

Martin J. Lippert, Executive Vice President, Global Technology & Operations (GT&O)

In reviewing Mr. Lippert’s performance against goals and market data, Mr. Kandarian recommended, and the Compensation Committee approved, an AVIP award and a stock-based long-term incentive award for 2015, both slightly higher than for 2014. This reflects appropriate competitive positioning as well as strong progress across his area of responsibility including cost savings initiatives, driving customer centricity, and advancing the Company’s global digital strategy.

The Compensation Committee considered that, under Mr. Lippert’s leadership, GT&O:

 

  Exceeded goals across all cost savings initiatives through consolidating operations and real estate around the world, prudent expense management, and streamlining processes;

 

  Drove MetLife’s enterprise digital strategy across all regions to establish competitive advantage by defining key investments across Innovation, Distribution, Data and Processes;

 

  Launched the industry’s first fully-digital platform for sales and policyholder self-service for MetLife’s U.S. Property & Casualty business;

 

  Exceeded U.S. call center customer experience goals as measured by First Call Resolution, Customer Satisfaction and Net Promoter Score metrics; and

 

  Achieved recognition in Newsweek magazine’s 2015 Green Rankings, which ranked MetLife in the top 20 among publicly traded companies in the United States (number 13) and globally (No. 19) for environmental performance. This marks the first time MetLife has entered the top 20 for both sets of Green Rankings.

Steven J. Goulart, Executive Vice President and Chief Investment Officer

In reviewing Mr. Goulart’s performance against goals and market data, Mr. Kandarian and the Compensation Committee approved an AVIP award and stock-based long-term incentive award for 2015, both of which are higher than for 2014. In determining Mr. Goulart’s compensation, the Compensation Committee reviewed competitive total compensation for comparable roles and considered that under Mr. Goulart’s leadership:

 

  The Investments team implemented material initiatives to improve Net Investment Income (NII) and counter the impacts of low interest rates, weak variable investment income and weak foreign currency versus the U.S. dollar.

 

  The team optimized the U.S. investment portfolio through significant asset reallocations to reduce regulatory capital use and improve cash flow while mitigating NII impacts.

 

  MetLife Investment Management continued to grow, exceeding the pre-tax profit plan, increasing assets under management and enhancing sales and service teams.
 

 

 

 

 

 

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Christopher G. Townsend, President, Asia

In determining Mr. Townsend’s compensation, Mr. Kandarian and the Compensation Committee reviewed his performance along with a review of competitive compensation data. His AVIP award and stock-based long-term incentive award for 2015 are higher than for 2014, reflecting the continued growth of the Asia region, his leadership on driving innovation to enhance the Company’s market position, and appropriate competitive positioning.

In determining Mr. Townsend’s compensation, the Compensation Committee considered the following:

 

  The Asia region increased Operating Earnings by 6% (16% on a constant currency basis) over 2014. Tangible ROE for Asia was 20.6% in 2015, compared to 19.3% in 2014.

 

  The Asia region is executing on its strategy to drive more value across its key markets. This includes expanding Accident & Health insurance sales in Japan by 11% over 2014, and maintaining a strong share of protection products, which stood at 46% in 2015 across the region.

 

  Mr. Townsend also continued to expand capabilities in Health, Digital, Data Analytics, and Innovation. These key differentiators enhance the current and long-term competitiveness of MetLife in Asia.

Trademark Information: INSTITUTIONAL INVESTOR is a registered trademark of, and ALL AMERICA EXECUTIVE TEAM is a trademark of, Institutional Investor LLC. FORTUNE and THE WORLD’S MOST ADMIRED COMPANIES are the registered trademarks of Time Inc. NEWSWEEK is a registered trademark of Newsweek, Inc. GREEN RANKINGS is a registered trademark of The Newsweek/Daily Beast Company LLC. All other trademarks are the property of their respective owners.

Stock-Based Long-Term Incentive Awards

The Company awards Stock Options, Performance Shares, and Restricted Stock Units (and, in some cases with respect to Executive Group members outside the United States, cash-payable equivalents). It determines the amount of such awards as part of MetLife’s Total Compensation program. For information about the specific grants of stock-based long-term incentive awards to the Named Executive Officers in 2015, see the table entitled “Grants of Plan-Based Awards in 2015” on page 75.

Stock Options. The Company grants Stock Options with an exercise price equal to the closing price of Shares on the grant date. The ultimate value of Stock Options depends exclusively on increases in the price of Shares. One-third of each award of Stock Options becomes exercisable on each of the first three anniversaries of the date of grant.

Restricted Stock Units. The Company delivers Shares for Restricted Stock Units after the end of a predetermined vesting period. Awards generally vest in thirds, and Shares are delivered, after each of the first three anniversaries of the grant date, assuming that the Company meets goals set for purposes related to Section 162(m) of the United States Internal Revenue Code (Section 162(m)) (see “Tax Considerations” on page 67).

From time to time, the Company grants Restricted Stock Units that vest on the third or later anniversary of their grant date. It does so in order to encourage a candidate to begin employment with MetLife (especially where the candidate would forfeit long-term compensation awards from another employer by doing so) or as a means of reinforcing retention efforts, particularly in cases of exceptional performance, critical skills, or talent.

Performance Shares. The Company delivers Shares for Performance Shares after the end of a three-year performance period. The number of Shares depends on Company performance, assuming that goals set for Section 162(m) are met.

Performance Share Awards in 2013 and later. The Compensation Committee approved performance guidelines for awards made in 2013 and later based on:

 

  the Company’s Operating ROE compared to its Business Plan goals; and

 

  total return on Shares, including change in Share price and imputed reinvested dividends, i.e., total shareholder return (TSR) compared to a custom group of competitors.

Each of these two factors is measured over the three-year performance period and each is weighted equally. The guidelines are subject to the satisfaction of the applicable Section 162(m) goals and the overall limit of 175% as the maximum performance factor.

 

 

 

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The guidelines to determine the Performance Factor are outlined in the following charts, indicating how the guideline Performance Factor relates to performance:

 

Operating ROE: 50% Component of

Performance Factor

  

TSR: 50% Component of  

Performance Factor  

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If the Company’s TSR for the performance period is zero or negative, the guidelines anticipate that the Committee will cap the entire performance factor at target.

See Appendix B for further details.

 

 

 

 

 

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With respect to the TSR component of the Performance Factor, the guidelines call for the Compensation Committee to assess the Company’s performance on a global basis against competitors around the world. As a result, it intends to use a group of competitors that is somewhat more globally diverse than the Comparator Group it uses for peer Total Compensation purposes.

 

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See Appendix B for further details.

 

The Compensation Committee has retained discretion to adjust these guidelines, or to consider other factors, should it find that it is appropriate to do so. Other factors may include significant unplanned acquisitions or dispositions, unplanned tax, accounting, and accounting presentation changes, unplanned restructuring or reorganization costs, and others the Compensation Committee finds appropriate.

The performance factor for the 2013-2015 Performance Shares was 86.2%. The Compensation Committee determined this factor in light of the guidelines described above. The Company’s TSR over the performance period was in the 27th percentile of the global comparator group provided under the guidelines, producing a TSR performance factor component of 31%. The Company’s average annual Operating ROE for the performance period was 12.0%, which was 110% of the average Business Plan goal of 10.9% for the performance period, producing an Operating ROE performance component of 141.3%. The

performance factor approved by the Compensation Committee was the average of these two components.

Performance Share Awards in 2012 and Earlier. For awards made in 2012 and earlier, Company performance was compared to the Fortune 500® companies included in the Standard & Poor’s Insurance Index, excluding Berkshire Hathaway Inc. (Insurance Index Comparators). The Insurance Index Comparators were chosen to measure MetLife’s relative performance because insurance is the predominant portion of the Company’s overall business mix. The final number of Performance Shares for such awards was determined by the Company’s performance in TSR and change in annual net Operating EPS (as defined by the Company for each year) compared to the other Insurance Index Comparators. The final number of Performance Shares could have been as low as zero and as high as twice the number of Performance Shares granted. For awards made in 2009 through 2012, if the Company did not

 

 

 

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produce a positive TSR for the performance period, the number of Shares would have been reduced by 25%.

The Performance Shares for the 2012-2014 performance period became deliverable in 2015. MetLife’s performance relative to the Insurance Index Comparators for that period produced a performance factor of 101%. The Compensation Committee determined this performance factor after the Company filed its 2015 Proxy Statement, and as a result it is not reported in that Proxy Statement.

For more information, see the table entitled “Option Exercises and Stock Vested in 2015” on page 80.

Phantom Stock-Based Awards. The Company grants cash-settled stock-based awards (Phantom Awards) to employees outside the United States, if paying cash is more appropriate than delivering Shares in light of tax and other regulatory circumstances.

 

  Each Unit Option represents the right to receive a cash payment equal to the closing price of a Share on the surrender date chosen by the employee, less the closing price on the grant date. One-third of each award of Unit Options becomes exercisable on each of the first three anniversaries of the date of grant.

 

  Performance Units are units that, if they vest, are multiplied by the same performance factor used for Performance Shares for the applicable period to produce a number of final Performance Units, each of which is payable in cash equal to the closing price of a Share on the date the final Performance Units are determined. Payment for Performance Units is contingent on Company achievement of goals set for Section 162(m) purposes.

 

  Restricted Units are units that vest on the same schedules as Restricted Stock Units and, if they vest, each is payable in cash equal to the closing price of a Share on the vesting date. Payment for Restricted Units that vest and pay out in three annual installments is contingent on Company achievement of goals set for Section 162(m) purposes.

Vesting. For awards granted in 2015 and later, the Company has used an approach that is simpler and more global than for previous awards. Employees whose combined age and years of MetLife employment is 65 or more, with at least 5 years of MetLife employment (the Rule of 65), will retain their awards following the end of their employment.

For awards granted through 2014, stock-based long-term incentive awards are normally forfeited if the executive leaves the Company voluntarily before the end of the applicable performance period or vesting period and is not Retirement Eligible or (except for Phantom Awards) Bridge Eligible. An employee is considered Retirement Eligible when the employee meets any one of the age and service combinations defined in the Metropolitan Life Retirement Plan for United States Employees (the Retirement Plan) to begin payout of certain benefits immediately upon separation from service (or, for the Phantom Awards, meets equivalent age and service criteria). See the table entitled “Pension Benefits at 2015 Fiscal Year-End” beginning on page 82 for more information about the Retirement Plan. Bridge Eligibility is available to employees based in the United States depending on a combination of age and service who have a final separation agreement under a particular severance plan. Bridge Eligible employees are eligible for post-retirement medical benefits despite not being Retirement Eligible.

Restrictive Covenants. In order to protect the Company, stock-based long-term incentive awards provide that Executive Group members who leave MetLife and provide services to a competitor, or any employee who violates MetLife’s agreement to protect corporate property, may lose those awards. The agreement to protect corporate property protects MetLife’s ownership of its property and information (including intellectual property) and prohibits the employee from interfering with MetLife’s business or soliciting MetLife’s employees or certain of its agents to leave MetLife until 18 months following the end of employment.

Retirement and Other Benefits

MetLife recognizes the importance of providing comprehensive, cost-effective benefits to attract, retain, engage, and motivate talented employees. The Company reviews its benefits program from time to time and makes adjustments to the design of the program to meet these objectives and to remain competitive with other employers.

Pension Program for U.S.-Based Executives. The Company sponsors a pension program in which all eligible U.S. employees, including the Executive Group members employed in the U.S., participate after one year of service. The program rewards employees for the length of their service and, indirectly, for their job performance, because the amount of benefits increases with the length of employees’ service with the Company and the salary and annual incentive awards they earn.

 

 

 

 

 

 

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The program includes the Retirement Plan and the MetLife Auxiliary Pension Plan (Auxiliary Pension Plan), an unfunded nonqualified plan. The Auxiliary Pension Plan provides pension benefits for any Executive Group members that would apply under the (qualified) Retirement Plan if U.S. tax limits on eligible compensation did not apply. It provides no additional or special benefits for Executive Group members. The same compensation formulae were used for benefits accrued in both plans in 2015.

For additional information about pension benefits for the Named Executive Officers, see the table entitled “Pension Benefits at 2015 Fiscal Year-End” on page 82.

Mr. Townsend did not participate in a defined benefit pension plan in 2015.

Mandatory Provident Fund Applicable to Mr. Townsend. Mr. Townsend participates in the Mandatory Provident Fund program for employees in Hong Kong. Applicable law requires employers and employees to contribute a fixed portion of employees’ earnings to the program, and allows employer and employees to make additional contributions. Because the rate and vesting of employer contributions are based on length of service, the program encourages employees to remain with the Company.

Savings and Investment Program. The Company sponsors a savings and investment program for U.S. employees in which each Executive Group member employed in the U.S. is eligible to contribute a portion of eligible compensation. The Company also contributes to the program after one year of employee service in order to encourage and reward such savings.

The program includes the Savings and Investment Plan for Employees of Metropolitan Life and Participating Affiliates (Savings and Investment Plan), a tax-qualified defined contribution plan that includes pre-tax deferrals under Internal Revenue Code Section 401(k), and the Metropolitan Life Auxiliary Savings and Investment Plan (Auxiliary Savings and Investment Plan), an unfunded nonqualified deferred compensation plan. The Auxiliary Savings and Investment Plan provides Company contributions for employees who elect to contribute to the Savings and Investment Plan and who have compensation beyond Internal Revenue Code limits.

Company contributions for the Named Executive Officers are included in the “All Other Compensation” column of the

Summary Compensation Table on page 69. Because the Auxiliary Savings and Investment Plan is a nonqualified deferred compensation plan, the Company’s contributions to the Named Executive Officers’ accounts, and the Named Executive Officers’ accumulated account balances and any payouts made during 2015, are reported in the table entitled “Nonqualified Deferred Compensation at 2015 Fiscal Year-End” on page 85.

Nonqualified Deferred Compensation Program for U.S.-Based Executives. The Company sponsors a nonqualified deferred compensation program for employees at the Assistant Vice-President level and above in the United States, including the Executive Group members employed in the U.S. The continued deferral of income taxation and pre-tax simulated investment earnings credited to participants through the employee’s chosen payment dates encourage employees to remain with the Company.

See the table entitled “Nonqualified Deferred Compensation at 2015 Fiscal Year-End” on page 85 for amounts of nonqualified deferred compensation reported for the Named Executive Officers.

Perquisites

The Company provides its Executive Group members with limited perquisites.

 

  To maximize the accessibility of Executive Group members, the Company makes leased vehicles and drivers and outside car services available to U.S.-based executives for commuting and personal use.

 

  The Company leases an aircraft for purposes of efficient business travel by the Company’s executives. While the Chief Executive Officer may occasionally use the Company’s aircraft for personal travel, Company policy does not require him to use the Company’s aircraft for all personal and business travel.

 

  For recordkeeping and administrative convenience of the Company, the Company pays certain other costs, such as those for travel and meals for family members accompanying Executive Group members on business functions.

 

 

The Company holds events to facilitate and strengthen its relationship with customers, potential customers, and other business partners, such as events at MetLife Stadium. The Company occasionally allows employees, including the Executive Group members, and their family members, personal use of its facilities at MetLife Stadium, to the extent space at

 

 

 

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such events is available or the facilities are not in use for business purposes.

 

  The Company provides benefits to Mr. Townsend in connection with his overseas assignment that are common for senior management in such circumstances, such as a subsidy of children’s education expenses, tax return preparation assistance, security services during periods of local civil unrest, and benefits related to housing.

Aside from limited business travel tax equalization for Executive Group members based outside the United States, each Executive Group member is responsible for any personal income taxes due as a result of receiving these benefits.

The incremental cost of perquisites provided to the Named Executive Officers in respect of 2015 is included in the “All Other Compensation” column of the Summary Compensation Table on page 69, if the total cost of those perquisites for that executive exceeded $10,000.

Sign-On Payments

From time to time, the Company offers newly-hired Executive Group members sign-on payments and/or relocation benefits in order to encourage them to come to MetLife. On such occasions, the Company typically either delays the date the payment is earned and paid or requires repayment if the executive leaves MetLife before the first anniversary (or, in some cases, second or third anniversary) of beginning employment.

Business Travel Income Tax Equalization

As executives of a global enterprise, MetLife Executive Group members are engaged in international business travel. Some executives are required by the demands of their roles to travel to jurisdictions that impose additional taxes on them beyond what they owe in their home jurisdiction. MetLife has established business travel income tax equalization arrangements with its Executive Group members based outside the United States. Providing such executives with “income tax equalization” to their home jurisdiction, by paying or reimbursing the executive for any excess income taxes the executive owes in other jurisdictions as a result of business travel, is a prevalent business practice. Doing so allows the executive to engage in business travel that is necessary to lead MetLife’s business efforts and perform job responsibilities without being financially penalized. It also prevents the additional personal income tax liability from being a disincentive to engage with employees, customers, or

others outside of the executive’s home jurisdiction. No taxes the executive owes as a result of travel taken solely for personal purposes are covered by these equalization arrangements. Mr. Townsend had such an agreement in 2015.

Potential Payments

Severance Pay and Related Benefits

The following describes the Company’s standard severance program and how it was applied in 2015. The Company may, in the future, enter into severance agreements that differ from the general terms of the program where business circumstances warrant.

If the employment of a U.S.-based Executive Group member ends involuntarily due to job elimination or, in limited circumstances, due to performance, he or she may be eligible for the severance program available to substantially all salaried employees. The program generally provides employees with severance pay, outplacement services and other benefits. Employees terminated for cause, as defined under the program, are not eligible. The amount of severance pay reflects the employees’ salary grade, base salary rate, and length of service. The severance pay formula for officer-level employees is potentially higher than that for other employees. Longer-service employees receive greater payments and benefits than shorter-service employees, given the same salary grade and base salary. Depending on the terms of the particular award, employees who reach or who are deemed Retirement Eligible or Bridge Eligible, or who meet the Rule of 65, retain their outstanding stock-based long-term incentive awards. Otherwise, employees who receive severance pay also receive a pro rata cash payment in consideration of their unretained Performance Shares and Performance Units.

In August 2015, William J. Wheeler, former President, Americas of the Company entered into a separation agreement under the Company’s standard arrangements. Based on his age and service, Mr. Wheeler qualified for an eligibility enhancement that deemed him to be retirement eligible. As a result, under terms that apply to all similarly-situated employees in the United States, he will retain his outstanding stock-based long-term incentive awards, subject to the terms of his separation agreement. For more information, see “Separation Arrangements for Mr. Wheeler” on page 93.

Change-in-Control Arrangements

The Company has adopted arrangements that would impact the

 

 

 

 

 

 

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Executive Group members’ compensation and benefits upon a change-in-control of MetLife. None of the Executive Group members is entitled to any excise tax gross-up either on severance pay or on any other benefits payable in connection with a change-in-control of the Company.

The Company established the MetLife Executive Severance Plan (Executive Severance Plan) in 2007 to apply to all Executive Group members and replace individual change-in-control agreements.

The Compensation Committee determined the terms of the plan based on its judgment of what is necessary to maximize shareholder value should a change-in-control occur. The Company designed the elements of its change-in-control definition to include circumstances where effective control over the Company would be captured by interests that differ substantially from those of the broad shareholder base the Company now has, without impinging on the Company’s flexibility to engage in transactions that are unlikely to involve such a transformation. An Executive Group member who receives benefits under the Executive Severance Plan would not also be eligible to receive severance pay under the Company’s

severance plan that is available to substantially all salaried employees.

The Executive Severance Plan does not provide for any payments or benefits based solely on a change-in-control of MetLife.

Rather, the Plan provides for severance pay and related benefits only if the executive’s employment also ends under certain circumstances.

The Company’s stock-based long-term agreements also include change-in-control arrangements. Under these arrangements, MetLife or its successor may substitute an alternative award of equivalent value and vesting provisions no less favorable than the award being replaced. Only if such substitution does not occur would the awards vest immediately upon a change-in-control.

For additional information about change-in-control arrangements, including the Company’s definition of change-in-control for these purposes, see “Potential Payments upon Termination or Change-in-Control at 2015 Fiscal Year-End” beginning on page 90.

 

 

 

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Risk Management

MetLife’s compensation program aligns with Company strategies and has a number of features that contribute to prudent decision making and do not incent executives to take excessive risks.

One important feature of MetLife’s program is its use of Operating Earnings as a metric in incentive programs. Operating Earnings excludes net investment gains and losses and net derivative gains and losses. This removes incentives not to hedge exposures to various risks inherent in a number of products or to disrupt the risk balance in MetLife’s investment portfolio by harvesting capital gains for the sole purpose of enhancing incentive compensation. It also removes incentives to use derivatives for speculative purposes, a practice that the Company prohibits. In addition, the Company uses three-year overlapping performance periods and vesting for long-term incentive compensation, so that time horizons for compensation reflect the extended time horizons for the results of many business decisions.

Other features of MetLife’s program, such as Share ownership requirements and a performance-based compensation recoupment policy, ensure that executives’ interests are aligned with those of shareholders. Through policies such as these, the Company encourages prudent risk-taking to the long-term benefit of shareholders, including the executives.

Management has reviewed the employee incentive compensation programs to ensure that, in design and operation and taking into account all of the risk management processes in place, they do not encourage excessive risk taking. In doing so, it followed principles provided by the Company’s Chief Risk Officer regarding performance measures, performance periods, payment determination processes, management controls, and other aspects of the arrangements. As a result of this review and his own assessment of the programs, the Company’s Chief Risk Officer has concluded that risks arising from the compensation policies and practices for employees of the Company and its affiliates are not reasonably likely to have a material adverse effect on the Company as a whole, in light of the features of those policies and practices and the controls in place to limit and

manage risk. As in prior years, the Chief Risk Officer discussed his analysis with the Compensation Committee in 2015.

Executive Share Ownership

To further align management’s interests with the interests of shareholders, the Company has established minimum Share ownership guidelines for officers at the Senior Vice President level and above, including the Executive Group members. The Company expects each person covered by the guidelines to own Shares equal in value to a multiple of annual base salary rate depending on position. The Company imposes no formal deadline to reach the expected ownership level. However, the Company expects each person covered by the guidelines to retain all net Shares acquired from compensation awards, except to the extent the employee’s Share ownership is above the guideline.

Employees may count toward these guidelines the value of Shares they or their immediate family members own directly or in trust. They may also count Shares held in the Company’s savings and investment program, Shares deferred under the Company’s nonqualified deferred compensation program and deferred cash compensation or auxiliary benefits measured in Share value.

The Share ownership of the serving Named Executive Officers as of December 31, 2015 was:

 

    Name               

 

  Guideline  

 

             

 

  Ownership  

 

 

Steven A. Kandarian

         7         8.6
 

John C. R. Hele

         4         1.4
 

Martin J. Lippert

         4         1.7
 

Steven J. Goulart

         3         2.4
 

Christopher G. Townsend

         3            0

Each of these executives has complied with the requirement to retain any net Shares acquired from compensation awards until meeting the guideline. Mr. Lippert joined the Company in 2011, and Mr. Hele and Mr. Townsend joined the Company in 2012. Each of them, and each of the other currently-active Named Executive Officers, also has significant outstanding awards deliverable in Shares (or payment in cash equivalent to Share value) that align his interests with those of shareholders.

 

 

 

 

 

 

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Equity Award Timing Practices

The Compensation Committee grants stock-based long-term incentive awards to the Executive Group members at its regularly scheduled meeting in February of each year. The amount of each grant is made with consideration of the Total Compensation for each Executive Group member, including annual cash incentive awards and any base salary increases. The exercise price of Stock Options or Unit Options is the closing price of a Share on the grant date. On the rare occasions when the Compensation Committee grants awards in connection with the hiring or change in responsibilities of an Executive Group member, or in order to encourage the executive to remain employed, it does so coincident with (or shortly after) the hiring, change in responsibilities, or other related changes. The Company has never granted, and has no plans to grant, any stock-based awards to current or new employees in anticipation of the release of non-public information about the Company or any other company. The Chief Executive Officer does not have any authority to grant Share-based awards of any kind to any Executive Group members, the Chief Accounting Officer, the Chief Risk Officer, or Directors of the Company.

MetLife determines the number of Performance Shares and Restricted Stock Units (and, in some cases with respect to Executive Group members outside the United States, cash payable equivalents) in each award by dividing that portion of the LTI award value by the Share closing price on the grant date, and the number of Stock Options in the award by dividing that portion of the LTI award value by one-third of the Share closing price on the grant date. If the Share closing price on the grant date is outside a 15% range (higher or lower) of the average Share closing price for the year to date, MetLife uses that average closing price instead of the closing price on the grant date. Regardless, the exercise price of Stock Options is the closing price on the grant date.

Performance-Based Compensation Recoupment Policy

The Company’s performance-based compensation recoupment policy applies to all employees of the Company and its affiliates. The policy applies when an employee engages in or contributes to fraudulent or other wrongful conduct that causes financial or reputational harm to the Company or its affiliates. Under those circumstances, the policy provides that the Company (and its affiliates or subsidiaries) may seek the recovery of performance-based compensation (including gains from sale of securities) purportedly earned by or paid to the employee during or after

the period of the misconduct. The policy is part of the terms of all performance-based compensation granted or paid by the Company and its affiliates. It does not limit the Company or any of its affiliates in enforcing any other rights or remedies they may have. The policy reinforces the Company’s intent to consider recovering performance-based compensation under the circumstances it covers. The Company will review the policy at such time as legal or regulatory requirements for the policy change.

Policies Prohibiting Hedging or Pledging Company Securities

The Company prohibits Directors and employees, including Executive Group members, from engaging in short sales, hedging, and trading in put and call options, with respect to the Company’s securities. In 2015, the Board of Directors changed Company policy to prohibit Directors and employees, including Executive Group members, from pledging MetLife securities. These policies are intended to prevent a misalignment of interests with Company shareholders or the appearance of such a misalignment.

Tax Considerations

Section 162(m) of the United States Internal Revenue Code limits the deductibility of compensation paid to certain executives, but exempts certain “performance-based” compensation from those limits. For 2015, the Compensation Committee established limits and performance goals in order for AVIP awards to the Company’s Executive Group members to be eligible for this exemption. As part of the Section 162(m) goal- setting process for 2015, the Compensation Committee set the maximum amount that any Executive Group member could be paid as an AVIP award at $10 million. See “Non-Equity Incentive Plan Awards” on page 75 for more information about the individual maximums set for 2015 AVIP awards. The Company has also designed Performance Shares, Stock Options and (with respect to regular awards to Executive Group members) Restricted Stock Units with the intention of making them eligible for the “performance-based compensation” exemption from Section 162(m) limits. However, the Compensation Committee reserves the right to grant compensation that does not meet Section 162(m) requirements if it determines it is appropriate to do so.

 

 

 

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      Compensation Discussion and Analysis

 

Accounting Considerations

Performance Shares granted in 2012 and earlier, Stock Options, and Restricted Stock Units qualify as equity-classified instruments whose fair value for determining compensation expense under current accounting rules is fixed on the date of grant. The Compensation Committee approved guidelines to determine the performance factor applicable to Performance

Shares granted in 2013 and later, and retained discretion to adjust them, or to consider other factors, should it find that it is appropriate to do so. As a result, these awards qualify for expense reporting on a variable basis. Phantom Awards qualify for expense reporting on a liability basis because they are paid in cash.

 

 

 

 

 

 

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    MetLife 2016 Proxy Statement

 


Table of Contents
Summary Compensation Table      

 

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Summary Compensation Table

 

                                                                                                                                     
    Name and
Principal
Position
          Year            

Salary

($)

           

Bonus

($)

           

Stock

Awards

($)

           

Option
Awards

($)

            Non-Equity
Incentive Plan
Compensation
($)
           

 

Change in
Pension Value
and
Nonqualified
Deferred
Compensation
Earnings

($)

 

            All Other
Compensation
($)
           

Total

($)

     
                                                                                                                                     
 

Steven A.
Kandarian

      2015

2014

2013

      $

$

$

1,425,000

1,325,000

1,212,500

  

  

  

      $

$

$

0

0

0

  

  

  

      $

$

$

6,837,430

6,027,795

5,854,539

  

  

  

      $

$

$

1,939,582

1,806,120

1,729,089

  

  

  

       

 

 

$4,500,000

$5,000,000

$5,000,000

  

  

  

       

 

 

$724,960

$709,963

$578,929

  

  

  

       

 

 

$   273,909

$   294,924

$   239,281

  

  

  

      $

$

$

15,700,881

15,163,802

14,614,338

  

  

  

 
 

Chairman of the

                                                       
 

Board, President

                                                       
 

and Chief Executive Officer

                                                       
 

John C. R. Hele

Executive Vice President and Chief Financial Officer

 

      2015

2014

2013

      $

$

$

706,250

637,500

600,000

  

  

  

      $

$

$

0

0

0

  

  

  

      $

$

$

2,051,234

1,870,695

585,460

  

  

  

      $

$

$

581,876

560,409

172,911

  

  

  

       

 

 

$2,200,000

$2,200,000

$1,500,000

  

  

  

       

 

 

$297,271

$213,406

$    9,332

  

  

  

       

 

 

$   101,741

$     75,123

$     19,397

  

  

  

      $

$

$

5,938,372

5,557,133

2,887,100

  

  

  

 
                                                         
                                                         
                                                         
 

Martin J. Lippert

Executive Vice

President, Global

Technology & Operations

      2015

2014

2013

      $

$

$

681,250

625,000

618,750

  

  

  

      $

$

$

0

0

0

  

  

  

      $

$

$

1,846,125

1,732,125

1,756,381

  

  

  

      $

$

$

523,692

518,903

518,723

  

  

  

       

 

 

$2,300,000

$2,200,000

$1,750,000

  

  

  

       

 

 

$301,478

$245,080

$189,823

  

  

  

       

 

 

$              0

$              0

$              0

  

  

  

      $

$

$

5,652,545

5,321,108

4,833,677

  

  

  

 
                                                         
                                                         
                                                         
                 
 

Steven J. Goulart

Executive Vice President and Chief Investment Officer

      2015       $ 637,500          $ 0          $ 1,367,505          $ 387,922            $1,400,000            $196,785            $     83,580          $ 4,073,292     
                 
 

Christopher G.

      2015       $ 587,236          $ 199,659          $ 1,093,994          $ 310,335            $1,099,172            $           0            $   598,286          $ 3,888,682     
 

Townsend1

      2014
      $ 537,532          $ 200,010          $ 1,039,275          $ 311,345            $   951,838            $           0            $   629,052          $ 3,669,052     
 

President, Asia

      2013       $ 500,000          $ 200,268          $ 951,349          $ 280,973            $   901,393            $           0            $   475,696          $ 3,309,679     
                 
 

William J. Wheeler

      2015       $ 515,673          $ 0          $ 1,914,479          $ 543,083            $              0            $268,627            $2,109,656          $ 5,351,518     
 

former President,

      2014       $ 768,750          $ 0          $ 2,251,763          $ 674,562            $2,000,000            $766,086            $   194,345          $ 6,655,506     
 

Americas

      2013       $ 750,000          $ 0          $ 2,122,270          $ 626,795            $3,250,000            $  82,514            $   124,430          $ 6,956,009     
                                                                                                                                     

 

1 Mr. Townsend was paid a cash sign-on bonus in each of 2013, 2014, and 2015 on the first three anniversaries of the date his employment began, which is reported in the Bonus column. The final payment was made in 2015.

Mr. Townsend did not participate in a defined benefit pension plan in 2013, 2014, or 2015 which is reflected in the Change in Pension Value and Nonqualified Deferred Compensation Earnings column.

The amount of tax equalization benefits is a component of the amount disclosed in the All Other Compensation column for Mr. Townsend. The amount reported for tax equalization benefits for 2014 in the Company’s 2015 Proxy Statement was $284,501. That amount was based on an estimate of such benefits, as the amount could not be determined due to differences between various jurisdictions’ tax years and the Company’s fiscal year. The amount of the benefit has now been determined to have been $267,457. This amount is reflected in the All Other Compensation and Total columns for Mr. Townsend for 2014 in this table. Accordingly, the amounts disclosed in the All Other Compensation and Total columns for Mr. Townsend for 2014 in this table are different from the amounts in such columns in the Summary Compensation Table in the Company’s 2015 Proxy Statement.

 

 

MetLife 2016 Proxy Statement    

 

 

 

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      Summary Compensation Table

 

Amounts for Mr. Townsend for 2015 in this table, and other executive compensation disclosure in this Proxy statement, that were denominated, accrued, earned, or paid in Hong Kong dollars have been converted to U.S. dollars at a rate of U.S.$1 = H.K.$7.765. In addition, the amounts in the Salary and Non-Equity Incentive Plan Compensation columns for 2015 differ from the amounts reviewed by the Compensation Committee. See “Incentive Compensation Decisions for 2015 Performance” on page 46. Amounts reported for 2014 and 2013 have not been adjusted from amounts reported in the Company’s 2015 Proxy Statement to reflect the change to the exchange rate used in this Proxy Statement compared to the Company’s 2015 Proxy Statement.

 

Basis for the information in the Summary Compensation Table

The amounts reported in the table above for 2015 include several elements that were not paid to the Named Executive Officers in 2015. The table includes items such as salary and cash incentive compensation that have been earned. It also includes the grant date fair value of Share-based long-term incentive awards granted in 2015 which may never become payable or be delivered, or may ultimately have a value that differs substantially from the values reported in this table. The table also includes changes in the value of pension benefits from prior year-end to year-end 2015 which will become payable only after the Named Executive Officer ends employment. The items and amounts reported in the table above for 2014 and 2013 bear a similar relationship to performance and amounts paid or payable in those years.

In addition, the amounts in the Total column do not represent “Total Compensation” as defined for purposes of the Company’s compensation guidelines and philosophy, and include elements that do not relate to 2015 performance. For additional information, see the Compensation Discussion and Analysis beginning on page 42.

The Company is required to include compensation in the Summary Compensation Table for either of the two years prior to 2015 to the extent that it was disclosed in any of its prior Proxy Statements. Mr. Goulart was not a Named Executive Officer in the Company’s 2015 or 2014 Proxy Statement. As a result, his compensation for 2014 and 2013 is not reported in the table above.

The amounts in each of the columns of the Summary Compensation Table are further discussed in the following.

Salary

The amount reported in the Salary column is the amount of base salary earned by each Named Executive Officer in that year.

For the relationship of each Named Executive Officer’s 2015 base salary earnings to that officer’s 2015 Total Compensation, see the Proxy Summary on page 6.

Stock Awards

Performance Shares and Performance Units. Performance Share and Performance Unit awards were granted in 2015 pursuant to the 2015 Stock and Incentive Plan. No monetary consideration was paid by a Named Executive Officer for any awards. No dividends or dividend equivalents are earned on any awards. For a description of the effect on the awards of a termination of employment or change-in-control of MetLife, see “Potential Payments upon Termination or Change-in-Control at 2015 Fiscal Year-End” beginning on page 90.

Performance Shares are delivered in Shares. Performance Units are paid in cash using the price of Shares.

On February 24, 2015, the Compensation Committee granted Performance Shares to each Named Executive Officer, except that it granted Mr. Townsend Performance Units. The Company may deliver Shares (or pay cash, in the case of Performance Units) after the end of the three-year performance period from January 1, 2015 to December 31, 2017. In order for these awards to be eligible to be fully tax deductible under Section 162(m), the Compensation Committee established separate threshold goals. As a result, for the Company to deliver Shares (or pay cash, in the case of Performance Units), the Company must generate either (1) positive income from continuing operations before provision for income tax, excluding net investment gains (losses) (defined in accordance with Section 3(a) of Article 7.04 of SEC Regulation S-X), which includes total net investment gains (losses) and net derivatives gains (losses), either for the third year of the performance period or for the performance period as a whole, or (2) positive TSR either for the third year of the performance period or for the performance period as a whole.

 

 

 

 

 

 

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    MetLife 2016 Proxy Statement

 


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If any of the above income or TSR goals are met, the number of Shares the Company delivers (or amount of cash it pays, in the case of Performance Units) at the end of the performance period is calculated by multiplying the number of Performance Shares or Performance Units by a performance factor (from 0% to 175%). The performance factor is to be determined by the Compensation Committee in consideration of the Company’s annual Operating ROE compared to its three-year business plan and TSR during the performance period compared to the Company’s peers and other factors the Compensation Committee determines relevant.

For a further discussion of the performance goals applicable to the Performance Share and Performance Unit awards in 2015, see the Compensation Discussion and Analysis beginning on page 42. For a discussion of the 2014 and 2013 Performance Share and Performance Unit awards, see the Company’s 2015 and 2014 Proxy Statements, respectively.

Restricted Stock Unit and Restricted Unit Awards. Restricted Stock Unit and Restricted Unit awards were granted in 2015 pursuant to the 2015 Stock and Incentive Plan. No monetary consideration was paid by a Named Executive Officer for any awards. No dividends or dividend equivalents are earned on any awards. For a description of the effect on the awards of a termination of employment or change-in-control of MetLife, see “Potential Payments upon Termination or Change-in-Control at 2015 Fiscal Year-End” beginning on page 90.

Restricted Stock Units are delivered in Shares. Restricted Units are paid in cash using the price of Shares.

On February 24, 2015, the Compensation Committee granted Restricted Stock Units to each Named Executive Officer, except that it granted Mr. Townsend Restricted Units. One-third of each of these awards vests on each of the first three anniversaries of the grant date. In order for each tranche of these awards to be eligible to be fully tax deductible under Section 162(m), the Compensation Committee established separate threshold goals. As a result, for the Company to deliver Shares (or pay cash, in the case of Restricted Units), the Company must generate either (1) positive income from continuing operations before provision for income tax, excluding net investment gains (losses) (defined in accordance with Section 3(a) of Article 7.04 of SEC Regulation S-X), which includes total net investment gains (losses) and net derivatives gains (losses) in the calendar year immediately preceding the anniversary date on which the tranche vests, or

(2) positive TSR either for the calendar year immediately preceding the anniversary date on which the tranche vests.

For a discussion of the 2014 and 2013 Restricted Stock Unit and Restricted Unit awards, see the Company’s 2015 and 2014 Proxy Statements.

Method for Determining Amounts Reported. The amounts reported in this column for Stock Awards were calculated by multiplying the number of Shares or units by their respective grant date fair value:

 

  $46.85 for February 24, 2015.

 

  $46.19 for February 25, 2014.

 

  $32.20 for February 26, 2013.

Those amounts represent the aggregate grant date fair value of the awards under ASC 718 consistent with the estimate of aggregate compensation cost to be recognized over the service period. For Performance Shares and Performance Units, the amounts are based on target performance, which is a total performance factor of 100%. This is the “probable outcome” of the performance conditions to which those awards are subject, determined under ASC 718. The grant date fair values of the Performance Shares and Performance Units granted in 2015 and 2014 assuming the highest level of performance conditions would be 1.75 times the amounts included in this column, rounded down to the nearest whole Share (or Share equivalent), as the same grant date fair value per share would be used but the total performance factor used would be 175%. For 2015 Performance Share and Performance Unit awards, that would produce the following hypothetical Grant Date Fair Values:

 

                     
    Name           

 

Hypothetical Grant Date Fair
Value of 2015
Performance Shares and
Performance Units at
  Maximum Performance Level
   

 

   
 

Steven A. Kandarian 

      $7,976,962  
 

John C. R. Hele 

      $2,393,098  
 

Martin J. Lippert 

      $2,153,788  
 

Steven J. Goulart 

      $1,595,383  
 

Christopher G. Townsend 

      $1,276,288  
 

William J. Wheeler 

      $2,233,574  
                     
 

 

 

MetLife 2016 Proxy Statement    

 

 

 

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For a description of the assumptions made in determining the expenses of Share awards, see Notes 1 and 16 to the Consolidated Financial Statements in the 2015, 2014, and 2013 Forms 10-K. In determining these expenses, it was assumed that each Named Executive Officer would satisfy any service requirements for vesting of the award. As a result, while a discount for the possibility of forfeiture of the award for this reason was applied to determine the expenses of these awards as reported in the Company’s Annual Reports on Form 10-K, no such discount was applied in determining the expenses reported in this column.

Option Awards

Stock Option awards were granted in 2015 pursuant to the 2015 Stock and Incentive Plan. No monetary consideration was paid by a Named Executive Officer for any awards. For a description of the effect on the awards of a termination of employment or change-in-control of MetLife, see “Potential Payments upon Termination or Change-in-Control at 2015 Fiscal Year-End” beginning on page 90.

On February 24, 2015, the Compensation Committee granted Stock Options to each Named Executive Officer. Each of these awards had a per option exercise price equal to the closing price of a Share on the grant date: $51.39. The Stock Options will normally become exercisable at the rate of one-third of each grant on each of the first three anniversaries of the grant date, and expire on the day before the tenth anniversary of that grant date.

For a discussion of the 2014 and 2013 Stock Options, see the Company’s 2015 and 2014 Proxy Statements, respectively.

Method for Determining Amounts Reported. The amounts reported in this column were calculated by multiplying the number of Stock Options by a grant date fair value per option of:

 

  $13.29 for February 24, 2015.

 

  $13.84 for February 25, 2014.

 

  $9.51 for February 26, 2013.

Those amounts represent the aggregate grant date fair value of the Stock Options granted in each year under ASC 718, consistent with the estimate of aggregate compensation cost to be recognized over the service period.

For a description of the assumptions made in determining the expenses of Stock Option awards, see Notes 1 and 16 to the Consolidated Financial Statements in the 2015, 2014, and 2013 Forms 10-K. In determining these expenses, it was assumed that each Named Executive Officer would satisfy any service requirements for vesting of the award. As a result, while a discount for the possibility of forfeiture of the award was applied to determine the expenses of these awards as reported in the Company’s Annual Reports on Form 10-K, no such discount was applied in determining the expenses reported in this column. In each case, the grant date of the awards was the date that the Compensation Committee approved the awards.

Non-Equity Incentive Plan Compensation

The amounts reported in the Non-Equity Incentive Plan Compensation column for each Named Executive Officer include the 2015 AVIP awards made in February 2016 by the Compensation Committee to each of the Named Executive Officers, which are based on 2015 performance. The AVIP awards are payable in cash by March 15, 2016. The factors considered and analyzed by the Compensation Committee in determining the awards are discussed in the Compensation Discussion and Analysis. For a description of the maximum award formula that applied to the awards for tax deductibility purposes, see the table entitled “Grants of Plan-Based Awards in 2015” on page 75.

Amounts reported in this column for 2014 and 2013 are AVIP awards with a similar relationship to performance in those years. The basis of these awards to the Named Executive Officers who appear in the Company’s 2015 and 2014 Proxy Statements, respectively, is discussed further in those Proxy Statements.

 

 

 

 

 

 

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    MetLife 2016 Proxy Statement

 


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Change in Pension Value and Nonqualified Deferred Compensation Earnings

The amounts reported in the Change in Pension Value and Nonqualified Deferred Compensation Earnings column for 2015 represent any aggregate increase during 2015 in the present value of accumulated pension benefits for each of the Named Executive Officers who participates in a defined benefit pension plan. The increase in the present value of these benefits reflects additional service in 2015, base salary compensation earned in 2015 (reflecting any increases in base salary rate), annual incentive awards payable in March 2015 for 2014 performance, and, in the case of Mr. Wheeler, the impact of changes in the discount rates used to value those benefits. The U.S.-based Named Executive Officers participate in the same retirement

program that applies to other administrative employees in the U.S. For a description of pension benefits, including the formula for determining benefits, see the table entitled “Pension Benefits at 2015 Fiscal Year-End” on page 82.

None of the Named Executive Officers’ earnings on their nonqualified deferred compensation in 2015, 2014, or 2013 were above-market or preferential. As a result, earnings credited on their nonqualified deferred compensation are not required to be, nor are they, reflected in this column. For a description of the Company’s nonqualified deferred compensation plans and the simulated investments used to determine earnings, see the table entitled “Nonqualified Deferred Compensation at 2015 Fiscal Year-End” on page 85.

 

 

All Other Compensation

The amounts reported in this column for 2015 include all other items of compensation: