PRE 14A 1 d75661dpre14a.htm PRE 14A PRE 14A
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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

 

 

Filed by the Registrant                        Filed by a Party other than the Registrant  

Check the appropriate box:

 

  Preliminary Proxy Statement
  Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
  Definitive Proxy Statement
  Definitive Additional Materials
  Soliciting Material Pursuant to §240.14a-12

VISA INC.

 

 

(Name of Registrant as Specified In Its Charter)

 

 

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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  (1)  

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(2)

 

 

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(3)

 

 

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  Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
  (1)  

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LOGO

Notice of 2021 Annual Meeting and Proxy Statement VISA


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Dear Fellow Stockholder,

On behalf of the Board of Directors, we want to thank you for your investment in Visa and encourage you to submit your proxy at this year’s annual meeting. There are a number of important matters on this year’s agenda, including an amendment to the equity incentive plan, an amendment to the certificate of incorporation to allow the adoption of a special meeting right for Class A common stockholders, and two stockholder proposals, in addition to proposals on the election of directors, say on pay, and auditors. Due to COVID-19, this year’s annual meeting will be held virtually.

COVID-19 has significantly impacted the global economy and our business. Our foremost priority through the pandemic has been the health and safety of our employees, clients, and the communities where we live and operate. While COVID-19 has impacted our financial results, there are many trends that are accelerating the demand for consumer payments, new flows and value-added services, which will help our business as we look ahead. Many small and medium-sized businesses have established and expanded their ecommerce presence, and consumers are increasingly becoming more comfortable making online purchases. In face-to-face transactions, consumers and merchants are recognizing that tap-to-pay payments are safe, easy and secure. Governments around the world have worked with Visa to efficiently provide stimulus and unemployment benefits to their constituents using Visa Direct or prepaid cards.

Visa reached significant milestones in 2020 in our work to drive an inclusive, equitable and sustainable world, including meeting our financial inclusion goal to provide 500 million previously unbanked or underserved people with access to a Visa branded payment account over a five-year period, of which 54% are women and approximately one-third are rural or lower income account holders. We also met our commitment to use 100% renewable electricity by 2020 through energy sources such as solar and wind, and we issued our inaugural $500 million green bond to finance projects in green buildings, renewable energy and energy- and water-efficient operations. Looking forward, Visa has committed to digitally enable 50 million small businesses globally through acceptance of digital payments, building online businesses and incentivizing neighborhood support in an effort to get local communities back to business in the wake of COVID-19. As part of our global commitment, Visa also launched the Visa Economic Empowerment Institute, which is focused on economic and societal issues such as closing racial and gender opportunity gaps and supporting small and micro businesses through pandemic-related challenges.

The worldwide efforts to advocate for racial and social justice are inspiring positive changes. Visa has made Inclusion and Diversity a business imperative with plans, commitments and specific goals that are rigorously tracked and tied to executive compensation. For example, we have established a $10 million Visa Black Scholars & Jobs program to attract talented Black graduates. In the U.S., we have also established goals to increase the number of employees from underrepresented populations in our workforce by 50% in five years, and to increase the number of leaders (VP and above) from underrepresented populations by 50% in three years. And we are establishing new mentorship and sponsorship programs that will provide Black employees career coaching, assistance with development plans, and career mapping guidance.

Talent management remained a top priority for the Board in 2020. The Board supported Visa’s commitment to conduct no COVID-19-related layoffs during calendar 2020. In July, the Board undertook a strategic talent review of the organization, with senior leaders sharing their perspectives on the teams they lead. In addition, the Nominating and Corporate Governance Committee undertook its quarterly management and director succession planning process.

The Board of Directors has been active during the pandemic, holding a number of virtual board meetings and receiving regular updates from management on the shifts in business and financial performance. Most Visa employees continue to work remotely with limited to no business disruption, demonstrating the effectiveness of the business continuity and cybersecurity plans regularly reviewed by the Board and the Audit and Risk Committee. Since the start of fiscal year 2020, we welcomed Ramon Laguarta, Chairman and CEO of PepsiCo, and Linda Rendle, CEO of The Clorox Company, to the Board of Directors. Ramon and Linda bring a wealth of strategic, global business experience to the Board. In other governance matters, Denise Morrison became the new chair of the Compensation Committee. In response to COVID-19, the Board adopted emergency bylaw provisions that would allow it to act if necessary during a crisis when a quorum of the Board cannot readily convene. Lastly, as discussed in Proposal 5 of this proxy statement, the Board recommends that stockholders amend the certificate of incorporation (in combination with bylaw amendments already approved by the Board) to afford Class A common stockholders the right to call a special meeting. We believe these changes will further strengthen Visa’s leading corporate governance practices.

Thank you for your continued support of Visa, and we look forward to your attendance at this year’s annual meeting.

 

Al Kelly   John Lundgren
Chairman and Chief Executive Officer   Lead Independent Director


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Items of Business

 

1.

To elect the twelve director nominees named in this proxy statement;

2.

To approve, on an advisory basis, the compensation paid to our named executive officers;

3.

To ratify the appointment of KPMG LLP as our independent registered public accounting firm for fiscal year 2021;

4.

To approve the Visa Inc. 2007 Equity Incentive Compensation Plan, as amended and restated;

5.

To approve an amendment to our Certificate of Incorporation to enable the adoption of a special meeting right for Class A common stockholders;

6.

To vote on a stockholder proposal requesting stockholders’ right to act by written consent, if properly presented;

7.

To vote on a stockholder proposal to amend our principles of executive compensation program, if properly presented; and

8.

To transact such other business as may properly come before the Annual Meeting and any adjournment or postponement thereof.

The proxy statement more fully describes these proposals.

Record Date

Holders of our Class A common stock at the close of business on November 27, 2020 are entitled to notice of and to vote at the Annual Meeting and any adjournment or postponement thereof. Holders of our Class A common stock will be entitled to vote on all proposals.

Attending the Annual Meeting

The meeting will be held Tuesday, January 26, 2021 at 8:30 a.m. Pacific Time. Log-in begins at 8:15 a.m. Eligible holders of our Class A common stock will be able to attend the meeting online, vote your shares electronically, view the list of stockholders and submit questions during the meeting by visiting www.virtualshareholdermeeting.com/V2021. To participate in the virtual meeting, you will need the 16-digit control number included on your Notice, proxy card or voting instruction form. Please refer to the “Attending the Meeting” section of the proxy statement for more details about attending the Annual Meeting online. We are not holding an in-person meeting.

Proxy Voting

Your vote is very important. Whether or not you plan to attend the Annual Meeting online, please vote at your earliest convenience by following the instructions in the Notice of Internet Availability of Proxy Materials or the proxy card you received in the mail. You may revoke your proxy at any time before it is voted. Please refer to the “Voting and Meeting Information” section of the proxy statement for additional information.

On December 3, 2020, we expect to release the proxy materials to the stockholders of our Class A common stock and to send to these stockholders (other than those Class A stockholders who previously requested electronic or paper delivery) a Notice of Internet Availability of Proxy Materials containing instructions on how to access our proxy materials, including our proxy statement and our fiscal year 2020 Annual Report, and to vote through the Internet or by telephone.

By Order of the Board of Directors

 

 

LOGO

Kelly Mahon Tullier

Executive Vice President, General

Counsel and Corporate Secretary

Foster City, California

December 3, 2020

 

 

Important Notice Regarding the Availability of Proxy Materials

for the 2021 Annual Meeting of Stockholders to be held on

January 26, 2021. The proxy statement and Visa’s Annual Report for fiscal year 2020 are available at

http://investor.visa.com.

 

 


Table of Contents

TABLE OF CONTENTS

 

PROXY SUMMARY

     1  

CORPORATE GOVERNANCE

     12  

Board Leadership Structure

     12  

Board of Directors and Committee Evaluations

     13  

Director Succession Planning and Board Refreshment

     13  

Independence of Directors

     14  

Executive Sessions of the Board of Directors

     14  

Limitation on Other Board and Audit Committee Service

     15  

Management Development and Succession Planning

     15  

The Board of Directors’ Role in Risk Oversight

     16  

Stockholder Engagement on Corporate Governance, Corporate Responsibility and Executive Compensation Matters

     17  

Communicating with the Board of Directors

     18  

Attendance at Board, Committee and Annual Stockholder Meetings

     18  

Codes of Conduct and Ethics

     18  

Political Engagement and Disclosure

     19  

Corporate Responsibility and Sustainability

     19  

COMMITTEES OF THE BOARD OF DIRECTORS

     23  

Audit and Risk Committee

     23  

Certain Relationships and Related Person Transactions

     24  

Report of the Audit and Risk Committee

     25  

Compensation Committee

     26  

Compensation Committee Interlocks and Insider Participation

     27  

Risk Assessment of Compensation Programs

     27  

Compensation Committee Report

     28  

Finance Committee

     28  

Nominating and Corporate Governance Committee

     29  

Process for Nomination of Director Candidates

     30  

Stockholder Recommended Candidates

     30  

Criteria for Nomination to the Board of Directors and Diversity

     31  

COMPENSATION OF NON-EMPLOYEE DIRECTORS

     32  

Highlights of our Non-Employee Director Compensation Program

     32  

Annual Retainers Paid in Cash

     33  

Equity Compensation

     33  

Stock Ownership Guidelines

     33  

Charitable Matching Gift Program

     34  

Director Compensation Table for Fiscal Year 2020

     34  

Fees Earned or Paid in Cash

     35  

Fiscal Year 2021 Director Compensation

     35  

PROPOSAL 1  – ELECTION OF DIRECTORS

     36  

DIRECTOR NOMINEE BIOGRAPHIES

     38  

BENEFICIAL OWNERSHIP OF EQUITY SECURITIES

     44  

EXECUTIVE OFFICERS

     46  

 

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COMPENSATION DISCUSSION AND ANALYSIS

     48  

Executive Summary

     48  

Say-on-Pay

     56  

Setting Executive Compensation

     57  

Summary of Fiscal Year 2020 Base Salary and Incentive Compensation

     59  

Fiscal Year 2020 Compensation

     60  

Fiscal Year 2021 Compensation

     71  

Other Equity Grant Practices and Policies

     72  

Policy Regarding Clawback and Forfeiture of Incentive Compensation

     73  

Tax Implications – Deductibility of Executive Compensation

     73  

EXECUTIVE COMPENSATION

     75  

Summary Compensation Table for Fiscal Year 2020

     75  

All Other Compensation in Fiscal Year 2020 Table

     77  

Grants of Plan-Based Awards in Fiscal Year 2020 Table

     78  

Outstanding Equity Awards at 2020 Fiscal Year-End Table

     80  

Option Exercises and Stock Vested Table for Fiscal Year 2020

     82  

Pension Benefits Table for Fiscal Year 2020

     83  

Visa Retirement Plan

     83  

Visa Excess Retirement Benefit Plan

     84  

Non-qualified Deferred Compensation for Fiscal Year 2020

     84  

Employment Arrangements and Potential Payments upon Termination or Change of Control

     87  

CEO PAY RATIO

     92  

PROPOSAL 2  – APPROVAL, ON AN ADVISORY BASIS, OF THE COMPENSATION PAID TO OUR NEOs

     93  

PROPOSAL 3  – RATIFICATION OF THE APPOINTMENT OF KPMG LLP

     94  

Independent Registered Public Accounting Firm Fees

     95  

PROPOSAL 4 – APPROVAL OF THE VISA INC. 2007 EQUITY INCENTIVE COMPENSATION PLAN, AS AMENDED AND RESTATED

     96  

PROPOSAL 5 – APPROVAL OF AN AMENDMENT TO OUR CERTIFICATE OF INCORPORATION TO ENABLE THE ADOPTION OF A SPECIAL MEETING RIGHT FOR CLASS A COMMON STOCKHOLDERS

     111  

PROPOSAL 6 – TO VOTE ON A STOCKHOLDER PROPOSAL REQUESTING STOCKHOLDERS’ RIGHT TO ACT BY WRITTEN CONSENT

     115  

PROPOSAL 7 – TO VOTE ON A STOCKHOLDER PROPOSAL TO AMEND OUR PRINCIPLES OF EXECUTIVE COMPENSATION PROGRAM

     117  

VOTING AND MEETING INFORMATION

     119  

Information About Solicitation and Voting

     119  

Who Can Vote

     119  

How to Vote

     120  

Change or Revoke a Proxy or Vote

     120  

How Proxies are Voted

     120  

Proxy Solicitor

     123  

Voting Results

     123  

 

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PROXY SUMMARY

This summary highlights information contained elsewhere in this proxy statement. This summary does not contain all of the information that you should consider, and you should read the entire proxy statement carefully before voting.

INFORMATION ABOUT OUR 2021 ANNUAL MEETING OF STOCKHOLDERS

 

 

LOGO

  

 

Tuesday, January 26, 2021 at 8:30 a.m. Pacific Time

 

 

LOGO

  

To support the health and well-being of our employees and stockholders, this year’s meeting will be held virtually via a live audio webcast at www.virtualshareholdermeeting.com/V2021.

 

LOGO

  

 

November 27, 2020

 

VOTING MATTERS

 

     Proposals    Board
Recommendation
   Page Number
for Additional
Information

LOGO

 

       Election of twelve director nominees    FOR (each nominee)    36

LOGO

 

      

Approval, on an advisory basis, of compensation paid to our named executive officers

   FOR    93

LOGO

 

      

Ratification of the appointment of our independent registered public accounting firm

   FOR    94

 

LOGO

 

      

Approval of the Visa Inc. 2007 Equity Incentive Compensation Plan, as amended and restated

   FOR    96

 

 

LOGO

      

Approval of an amendment to our Certificate of Incorporation to enable the adoption of a special meeting right for Class A common stockholders

   FOR    111

 

LOGO

 

      

To vote on a stockholder proposal requesting stockholders’ right to act by written consent

   AGAINST    115

 

LOGO

 

      

To vote on a stockholder proposal to amend our principles of executive compensation program

   AGAINST    117


 

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CORPORATE GOVERNANCE AND BOARD HIGHLIGHTS

We are committed to corporate governance practices that promote long-term value and strengthen board and management accountability to our stockholders, customers and other stakeholders. Information regarding our corporate governance framework begins on page 12, which includes the following highlights:

 

Number of director nominees

  12    Demonstrated commitment to board refreshment  

 

LOGO

Percentage of independent director nominees

  92%    Annual board, committee and director evaluations  

 

LOGO

Directors attended at least 75% of meetings

 

 

LOGO

   Regularly focus on director succession planning  

 

LOGO

Annual election of directors

 

 

LOGO

   Risk oversight by full board and committees  

 

LOGO

Majority voting for directors

 

 

 

LOGO

   Stockholder outreach/engagement program  

 

LOGO

Proxy access (3%/3-years)

 

 

LOGO

   Stock ownership requirements for directors and executive officers  

 

LOGO

Robust Lead Independent Director duties

 

 

LOGO

   Political Participation, Lobbying and Contributions Policy  

 

LOGO

Regular executive sessions of independent directors

 

 

LOGO

   Oversight of corporate culture and human capital management  

 

LOGO



 

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Snapshot of 2021 Director Nominees

Our director nominees exhibit an effective mix of diversity, experience and perspective

 

 

LOGO

 

       

 

Director

Since

         

Committee
Memberships

 

Other

Current

Public

Boards

   
     Name   Principal Occupation   Independent   ARC   CC   FC   NGC     

LOGO

 

Lloyd A. Carney

  2015   CEO, Carney Global Ventures LLC    

 

LOGO

 

 

 

 

 

 

  3  

LOGO

 

Mary B. Cranston

 

 

2007

 

 

Director

               

 

2

   

LOGO

  Francisco Javier
Fernández-Carbajal
  2007   Director General, Servicios
Administrativos Contry SA de CV
             

 

  3    

LOGO

 

Alfred F. Kelly, Jr.

  2014   Chairman and CEO, Visa  

 

       

 

   

 

   

 

     

LOGO

 

Ramon Laguarta

  2019   Chairman and CEO, PepsiCo, Inc.  

 

     

 

   

 

    1    

LOGO

 

John F. Lundgren

 

 

2017

 

 

Lead Independent Director, Visa

     

 

     

 

   

 

1

   

LOGO

 

Robert W. Matschullat

  2007   Director      

 

    LOGO    

 

     

LOGO

 

Denise M. Morrison

  2018   Founder, Denise Morrison & Associates, LLC       LOGO    

 

   

 

  2    

LOGO

 

Suzanne Nora Johnson

  2007   Director        

 

        2    
LOGO  

Linda J. Rendle

  2020   CEO, The Clorox Company                 1    

LOGO

 

John A. C. Swainson

  2007   Director        

 

   

 

  LOGO   1    

LOGO

 

Maynard G. Webb, Jr.

  2014   Founder, Webb Investment Network      

 

       

 

  1    

 

ARC = Audit and Risk Committee     CC = Compensation Committee     FC = Finance Committee

NGC = Nominating & Corporate Governance Committee

 

 

LOGO  = Chair     = Member



 

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Our Compensation Philosophy, Principles and Key Elements

We provide our named executive officers (“NEOs”) with short- and long-term compensation opportunities that encourage increasing performance to enhance stockholder value while avoiding excessive risk-taking.

We maintain compensation plans that tie a substantial portion of our named executive officers’ overall target annual compensation to the achievement of corporate and individual performance goals. The Compensation Committee employs multiple performance measures and strives to award an appropriate mix of annual and long-term equity incentives to avoid overweighting short-term objectives. Annual goals promote and incorporate environmental, social and governance (“ESG”) factors that are relevant to the Company’s strategic objectives or each NEO’s individual scope of responsibility.

 

 

LOGO

 

 

       

Annual Incentive Plan: Individual and Corporate Performance

 

 

     

  Corporate performance goals are a key component of our annual incentive plan

 

  A significant portion of our executive officers’ individual performance goals is tied to one or more of our strategic objectives (as explained further in this proxy statement under Individual Performance Goals and Results for Fiscal Year 2020)

 

  The executive officers’ individual performance goals also include relevant ESG factors such as:

 Inclusion and diversity

 Employee leadership and development

 Employee health, safety, productivity, and engagement

 Cybersecurity and data privacy

 Financial inclusion and access

 Corporate governance

 

 

       

Aligns executive officers’ interests with stockholders’ interests by:

 

  rewarding individual performance for achievement of strategic goals (designed to position the Company competitively)

 

  promoting strong financial results

 

 

 

       

Long-Term Equity Grants: Individual and Corporate Performance

 

 

       

  We link a substantial portion of compensation to long-term corporate performance through the use of long-term incentives, including performance shares that use EPS and relative TSR as financial metrics

 

  We consider individual performance (which is tied to our strategic objectives, including relevant ESG factors) in setting the value of our executive officers’ long-term equity grant

       

Further aligns executive officers’ interests with long-term stockholders’ interests by:

 

  taking individual performance (which is tied to our strategic objectives) into account in making equity grants

 

  linking a substantial portion of long-term compensation to long-term corporate performance and operational efficiency

 

 



 

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Principles of our Compensation Program
Pay for Performance   

 

The key principle of our compensation philosophy is pay for performance.

 

Alignment with Stockholders’ Interests

  

We reward performance that meets or exceeds the performance goals that the Compensation Committee establishes with the objective of increasing stockholder value.

 

 

Variation Based on Performance

   We favor variable pay opportunities that are based on performance over fixed pay. The total compensation received by our NEOs varies based on corporate and individual performance measured against annual and long-term goals.

 

Motivate and Retain Key Talent

  

 

We design our compensation program to motivate and retain key talent. This item has been added to the “Principles of Our Compensation Program” this year to reflect the Compensation Committee’s existing commitment to this principle.

Key Elements of our Fiscal Year 2020 Compensation Program

 

 

LOGO



 

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EXECUTIVE COMPENSATION PROGRAM HIGHLIGHTS

Highlights of Our Compensation Programs

 

  WHAT WE DO:

 

   LOGO

  

 

Pay for performance

 

   LOGO

  

 

Annual say-on-pay vote

 

   LOGO

  

 

Recoupment policies

 

 

   LOGO

  

 

Short-term and long-term incentives/measures

 

   LOGO

  

 

Capped incentive awards

 

   LOGO

  

 

Independent compensation consultant

 

   LOGO

  

 

Stock ownership guidelines

 

 

   LOGO

  

 

Limited perquisites

 

   LOGO

  

 

Engagement with stockholders

 

   LOGO

  

 

Alignment with ESG factors

  WHAT WE DO NOT DO:

 

   LOGO

  

 

Gross-up for excise taxes

 

 

   LOGO

  

 

 

Repricing of stock options

 

   LOGO

  

 

Fixed-term employment agreements

 

   LOGO

  

 

Single-trigger severance arrangements

 

   LOGO

  

 

Hedging and pledging of Visa securities

 

 

 

FISCAL YEAR 2020 COMPANY HIGHLIGHTS

 

 

LOGO

 

(1) 

For further information regarding non-GAAP adjustments, including a reconciliation to GAAP, please see Item 7 – Management’s Discussion and Analysis of Financial Condition and Results of Operations – Overview in our 2020 Annual Report as filed on Form 10-K with the Securities and Exchange Commission on November 19, 2020.

(2) 

Total shareholder return includes reinvestment of dividends.



 

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BOARD’S ROLE IN LONG-TERM STRATEGIC PLANNING

The Board takes an active role with management to formulate and review Visa’s long-term corporate strategy. Each quarter, the Board and management confer on the execution of our long-term strategic plans, the status of key initiatives and the key opportunities and risks facing Visa. In addition, the Board regularly conducts in-depth long-term strategic reviews with our senior management team. During these reviews, the Board and management discuss the payments landscape, emerging technological and competitive threats, and short- and long-term plans and priorities within our strategy.

Additionally, the Board annually discusses and approves the budget and capital requests, which are firmly linked to Visa’s long-term strategic plans and priorities. Through these processes, the Board brings its collective, independent judgment to bear on the most critical long-term strategic issues facing Visa. For more information on our long-term strategy and the progress we made against our strategic goals in fiscal 2020, please see our 2020 Annual Report, including the letter from our Chairman and Chief Executive Officer, Alfred F. Kelly, Jr., to our stockholders.

Talent and Human Capital Management

Attracting, developing and retaining the best people globally is crucial to all aspects of Visa’s activities and long-term success, and is central to our long-term strategy. We are focused on attracting, developing and retaining best-in-class diverse teams and continuing to build an inclusive culture that inspires leadership, encourages innovative thinking and supports the development and advancement of all.

These guiding principles have been more important than ever in light of the unique challenges of 2020. At Visa, we are committed to the health and safety of our employees and their families. To support our employees during this time, we expanded remote work, established specialized employee engagement and feedback initiatives, broadened benefit offerings and committed to no employee layoffs in calendar year 2020 related to COVID-19. Our Chairman and Chief Executive Officer has provided video updates to all employees every week since the onset of COVID-19, and our regional leaders have hosted weekly town hall meetings. We offered additional Employee Assistance Program counseling sessions and conducted global Employee Pulse Surveys to understand and respond to employee needs.



 

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In response to ongoing racial injustice, we are committed to doing our part to improve our inclusion and increase our diversity. Visa is driving important change through specific actions, including establishing goals to increase the number of U.S. employees from underrepresented groups, creating the Visa Black Scholars & Jobs program, and launching a “Race Talks” series to promote internal education and conversation. We are also equipping our employees to be active allies. In addition to fostering an inclusive workplace that encourages diversity, Visa has fostered a culture where all employees are encouraged and empowered to be leaders. To build this culture, we have embraced the following Visa Leadership Principles that are integrated into all we do, and drive accountability for the way we act and the way we lead. Employees are evaluated not only for performance, but also against the following behaviors:

 

 

LOGO

The tone and culture of Visa is set at the Board level and Board committees have responsibility for specific areas of human capital management oversight. Our Nominating and Corporate Governance Committee is responsible for director appointments and ensuring a diverse pool of director candidates are considered. Our Compensation Committee reviews Visa’s programs and practices related to executive workforce inclusion and diversity and the administration of compensation programs in a non-discriminatory manner.

Management is responsible for ensuring that our policies and processes reflect and reinforce our desired corporate culture, including policies and processes related to strategy, risk management, and ethics and compliance.



 

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Employee Development and Engagement

Visa understands that being an employer of choice requires providing best-in-class training and development opportunities, while creating innovative programs that enable a vibrant and engaged learning culture to flourish. We strive to achieve this through a number of forums, including Visa University, our signature global learning platform that houses more than 80,000 learning resources. Employee participation more than doubled in the last year, up to over 10 courses on average per employee. Classes are taught and facilitated by company leaders and external speakers who bring real-world context and ideas for practical application that are aligned with Visa’s goals.

We recognize that building an inclusive and high-performance culture requires an engaged workforce, where employees are motivated to do their best work every day. Our engagement approach centers on communication and recognition. We communicate with our employees in a variety of ways, including weekly CEO video updates, company intranet, digital signage, email newsletters, live events in regional offices and quarterly all-staff meetings. Our recognition programs include our Go Beyond program, where managers and peers recognize employees who exemplify our leadership principles.

We assess employee engagement through a variety of channels, including employee pulse surveys, which provide feedback on a variety of topics, such as company direction and strategy, inclusion and diversity, individual growth and development, collaboration and confidence and trust. Given the extraordinary challenges of COVID-19 and the sudden transition to remote work arrangements, this year’s surveys were tailored to understand and respond to employee needs. Through these special employee pulse surveys in fiscal year 2020, we learned that 94% of employee respondents feel that employee health and wellbeing is a top priority for Visa, and 96% are pleased with the cadence of communications they received from leadership during this challenging time.

Employee Benefits

We believe our employees are critical to the success of our business and we structure our total rewards and benefits package to attract and retain a talented and engaged workforce. We continue to evolve our programs to meet our employees’ needs, providing comprehensive health, financial wellness and quality of life coverage. Our programs vary by location, but may include:

 

 

LOGO



 

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Table of Contents

Inclusion and Diversity

Visa believes in an inclusive and diverse workplace where everyone is accepted, everywhere. We are fueled by our mission to create a culture in which individual differences, experiences and capabilities are valued and contribute to our business success. By leveraging the diverse backgrounds and perspectives of our worldwide teams, we are able to achieve better solutions for our clients and create a connected workplace to attract and retain top talent. With our mission in mind, Visa’s approach to inclusion and diversity involves four key strategic pillars:

 

 

 

LOGO

Workforce Demographics and Pay Equity

Visa tracks, measures and evaluates our workforce representation and impact as part of our strategic business imperative to build a diverse and inclusive organization. We are committed to reporting our workforce demographics annually.

 

 

LOGO



 

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Equal Pay for Equal Work

Men and women earn the same pay for the same work globally, and the same is true

for underrepresented minorities and their white peers in the U.S.

 

 

LOGO

* Notes:

 

Data is based on company records as of September 30, 2020.

 

Leadership: Defined as VP and above.

 

Others: American Indian/Alaska Native, Native Hawaiian/Other Pacific Islander and two or more races. Ethnicity data does not include undeclared and blanks.

 

Equal pay analysis is based on FY20 total compensation, which includes base salary, VIP (Visa Incentive Plan) and LTIP (Long-Term Incentive Program).

 

Underrepresented minorities are defined as Black/African American, Hispanic/Latinx, American Indian/Alaska Native, Native Hawaiian/Other Pacific Islander or two or more races.



 

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CORPORATE GOVERNANCE

Members of our Board oversee our business through discussions with our Chief Executive Officer; President; Vice Chairman and Chief Financial Officer; General Counsel; Chief Risk Officer; President, Technology; and other officers and employees, and by reviewing materials provided to them and participating in regular meetings of the Board and its committees.

The Board regularly monitors our corporate governance policies and profile to ensure we meet or exceed the requirements of applicable laws, regulations and rules, and the listing standards of the New York Stock Exchange (NYSE). We have instituted a variety of practices to foster and maintain responsible corporate governance, which are described in this section. To learn more about Visa’s corporate governance and to view our Corporate Governance Guidelines, Code of Business Conduct and Ethics, and the charters of each of the Board’s committees, please visit the Investor Relations page of our website at http://investor.visa.com under “Corporate Governance.” Our Corporate Responsibility and Sustainability Report is located on our website at http://usa.visa.com/about-visa/operating-responsibly.html. You may request a printed copy of any of these documents free of charge by contacting our Corporate Secretary at Visa Inc., P.O. Box 193243, San Francisco, CA 94119 or corporatesecretary@visa.com.

Board Leadership Structure

Al Kelly currently serves as Chairman and Chief Executive Officer, with John Lundgren serving as Lead Independent Director. While the Company does not have a policy on whether the roles of Chairperson and Chief Executive Officer should be split, the Board believes that combining the roles is in the best interests of the Company and its stockholders as this structure allows Mr. Kelly to effectively manage the business, execute on our strategic priorities, and lead the Board and empowers Mr. Lundgren to provide independent Board leadership and oversight. The Board believes that Mr. Kelly’s inclusive leadership style and decades of payments expertise make him uniquely qualified to lead discussions of the Board; foster an important unity of leadership between the Board and management; and promote alignment of the Company’s strategy with its operational execution.

In order to further promote independent leadership, the Board developed a robust set of responsibilities for the Lead Independent Director role, including:

 

   

calling, setting the agenda for, and chairing periodic executive sessions and meetings of the independent directors;

 

   

chairing Board meetings in the absence of the Chairperson of the Board or when it is deemed appropriate arising from the Chairperson’s management role or non-independence;

 

   

providing feedback to the Chairperson and CEO on corporate and Board policies and strategies and acting as a liaison between the Board and the CEO;

 

   

facilitating communication among directors and between the Board and management;

 

   

in concert with the Chairperson and CEO, advising on the agenda, schedule and materials for Board meetings and strategic planning sessions based on input from directors;

 

   

coordinating with the Chair of the Nominating and Corporate Governance Committee, leading the independent directors’ involvement in CEO succession planning, selection of committee chairs and committee membership, and the board evaluation process;

 

   

coordinating with the Chair of the Compensation Committee, leading the independent directors’ evaluation of CEO performance and compensation;

 

   

communicating with major stockholders as necessary; and

 

   

carrying out such other duties as are requested by the independent directors, the Board or any of its committees from time to time.

 

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The Board will continue to periodically review the Board’s leadership structure and its appropriateness given the needs of the Board and the Company at such time.

In addition to our Lead Independent Director, independent directors chair the Board’s four standing committees: the Audit and Risk Committee, chaired by Lloyd A. Carney; the Compensation Committee, chaired by Denise M. Morrison; the Finance Committee, chaired by Robert W. Matschullat; and the Nominating and Corporate Governance Committee, chaired by John A.C. Swainson. In their capacities as independent committee chairs, Messrs. Carney, Matschullat, Swainson and Ms. Morrison each have responsibilities that contribute to the Board’s oversight of management, as well as facilitating communication among the Board and management.

Board of Directors and Committee Evaluations

Our Board recognizes that a robust and constructive Board and committee evaluation process is an essential component of board effectiveness. As such, our Board and each of our committees conduct an annual evaluation facilitated by an independent third party, which includes a qualitative assessment by each director of the performance of the Board and the committee or committees on which the director sits. The Board also conducts an annual peer review, which is designed to assess individual director performance. The Nominating and Corporate Governance Committee, in conjunction with the Lead Independent Director, oversees the evaluation process.

 

LOGO

 

   
LOGO  

Feedback Incorporated

Over the past few years, the evaluation process has led to a broader scope of topics covered in the board meetings,
improvements in board process, and changes to board and committee composition and structure.

 

This year’s evaluation identified areas for continued focus, including:

  strategy and broader market trends
  enhancements to board effectiveness
  risk management, including the Board’s role in a crisis
  Board composition in support of long-term strategy, and
  management and director succession planning

 

Director Succession Planning and Board Refreshment

In addition to executive and management succession, the Nominating and Corporate Governance Committee regularly oversees and plans for director succession and refreshment of the Board to ensure a mix of skills, experience, tenure, and diversity that promote and support the Company’s long-term strategy. In doing so, the Nominating and Corporate Governance Committee takes into consideration the overall needs, composition and size of the Board, as well as the criteria adopted by the Board regarding director candidate qualifications, which are described in the section entitled Criteria for Nomination to the Board of Directors and Diversity. Individuals identified by the Nominating and Corporate Governance Committee as qualified to become directors are then recommended to the Board for nomination or election.

 

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Independence of Directors

The NYSE’s listing standards and our Corporate Governance Guidelines provide that a majority of our Board and every member of the Audit and Risk, Compensation, and Nominating and Corporate Governance committees must be “independent.” Our Certificate of Incorporation further requires that at least 58% of our Board be independent. Under the NYSE’s listing standards, our Corporate Governance Guidelines and our Certificate of Incorporation, no director will be considered to be independent unless our Board affirmatively determines that such director has no direct or indirect material relationship with Visa or our management. Our Board reviews the independence of its members annually and has adopted guidelines to assist it in making its independence determinations. For details, see our Corporate Governance Guidelines, which can be found on the Investor Relations page of our website at http://investor.visa.com under “Corporate Governance.”

In October 2020, with the assistance of legal counsel, our Board conducted its annual review of director independence and affirmatively determined that each of our non-employee directors (Lloyd A. Carney, Mary B. Cranston, Francisco Javier Fernández-Carbajal, Ramon Laguarta, John F. Lundgren, Robert W. Matschullat, Denise M. Morrison, Suzanne Nora Johnson, John A. C. Swainson and Maynard G. Webb, Jr.) is “independent” as that term is defined in the NYSE’s listing standards, our independence guidelines and our Certificate of Incorporation. In connection with her appointment to the Board in November 2020, our Board reviewed and affirmatively determined that Ms. Rendle is independent under the same standard.

In making the determination that the directors listed above are independent, the Board considered relevant transactions, relationships and arrangements, including those specified in the NYSE listing standards and our independence guidelines, and determined that these relationships were not material relationships that would impair the director’s independence. In this regard, the Board considered that certain directors serve as directors of other companies with which the Company engages in ordinary-course-of-business transactions, and that, in accordance with our director independence guidelines, none of these relationships constitute material relationships that would impair the independence of these individuals. Discretionary contributions to certain charitable organizations with which some of our directors are affiliated also were considered, and the Board determined that the amounts contributed to each of these charitable organizations in the past fiscal year were less than $120,000 and that these contributions otherwise created no material relationships that would impair the independence of those individuals.

In addition, each member of the Audit and Risk Committee and the Compensation Committee meets the additional, heightened independence criteria applicable to such committee members under the applicable NYSE rules.

Executive Sessions of the Board of Directors

The non-employee, independent members of our Board and all committees of the Board generally meet in executive session without management present during their regularly scheduled in-person board and committee meetings, and on an as-needed basis during telephonic and special meetings. John Lundgren, our Lead Independent Director, presides over executive sessions of the Board and the committee chairs, each of whom is independent, preside over executive sessions of the committees.

 

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Limitation on Other Board and Audit Committee Service

Our Corporate Governance Guidelines establish the following limits on our directors serving on publicly-traded company boards and audit committees:

 

Director Category   

Limit on publicly-traded board and

committee service, including Visa

All directors

  

      4 boards

Directors who are executives of a publicly-traded company

  

      2 boards

Directors who serve on our Audit and Risk Committee

  

      3 audit committees

The Nominating and Corporate Governance Committee may grant exceptions to the limits on a case-by-case basis after taking into consideration the facts and circumstances of the request. The Guidelines provide that prior to accepting an invitation to serve on the board or audit committee of another publicly-traded company, a director should advise the Chair of the Board and the Nominating and Corporate Governance Committee of the invitation so that the Board, through the Nominating and Corporate Governance Committee, has the opportunity to review the director’s ability to continue to fulfill his or her responsibilities as a member of the Company’s Board or Audit and Risk Committee. When reviewing such a request, the Nominating and Corporate Governance Committee may consider a number of factors, including the director’s other time commitments, record of attendance at board and committee meetings, potential conflicts of interest and other legal considerations, and the impact of the proposed directorship or audit committee service on the director’s availability.

Mr. Carney serves as chief acquisition officer of Carney Technology Acquisition Corp. II (CTAC), a special purpose acquisition company (SPAC). Mr. Carney reports to the CEO of CTAC and does not serve on the board of directors. After any CTAC initial public offering, Mr. Carney will not be considered an executive of a publicly-traded company for purposes of the Board’s policy limiting service on other public company boards given that service as an officer of a SPAC does not have the same demands as being an executive officer of a typical publicly-traded company.

Management Development and Succession Planning

Our Board believes that one of its primary responsibilities is to oversee the development and retention of executive talent and to ensure that an appropriate succession plan is in place for our Chief Executive Officer and other members of senior management. Each quarter, the Nominating and Corporate Governance Committee meets with our Executive Vice President, Human Resources and other executives to discuss management succession and development planning and to address potential vacancies in senior leadership. The Nominating and Corporate Governance Committee also annually reviews with the Board succession planning for our Chief Executive Officer.

 

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The Board of Directors’ Role in Risk Oversight

Our Board recognizes the importance of effective risk oversight in running a successful business and in fulfilling its fiduciary responsibilities to Visa and its stockholders. While the Chief Executive Officer, Chief Risk Officer, General Counsel, Vice Chairman and Chief Financial Officer, President, Technology and other members of our senior leadership team are responsible for the day-to-day management of risk, our Board is responsible for promoting an appropriate culture of risk management within the Company and for setting the right “tone at the top,” overseeing our aggregate risk profile and monitoring how the Company addresses specific risks, such as strategic and competitive risks, financial risks, brand and reputation risks, cybersecurity and technology risks, ecosystem risks, legal and compliance risks, regulatory risks and operational risks.

 

 

LOGO

 

LOGO

 

    

LOGO

 

    

LOGO

 

    

LOGO

 

       

Audit and Risk Committee

 

Oversees risks related to our enterprise risk framework and programs, including:

 

•  financial statements, financial reporting and internal controls

 

•  legal and regulatory

 

•  corporate risk profile, top risks and key operational risks

 

•  technology, including information security and cybersecurity

 

•  global privacy program

 

•  compliance and ethics program, including AML and sanctions; and

 

•  business continuity program

 

 

    

Compensation Committee

 

Oversees risks related to employees and compensation, including:

 

•  our compensation policies and practices for all employees; and

 

•  our incentive and equity- based compensation plans

 

For additional information regarding the Compensation Committee’s review of compensation-related risk, please see the section entitled Risk Assessment of Compensation Programs.

 

    

Finance Committee

 

Oversees risks related to mergers and acquisitions and certain financial matters, including:

 

•  capital investments

 

•  debt

 

•  credit and liquidity

 

•  capital structure; and

 

•  tax strategy

    

Nominating and Corporate Governance Committee

 

Oversees risks related to our overall corporate governance, including:

 

•  board effectiveness

 

•  board and committee composition

 

•  board size and structure

 

•  director independence

 

•  board succession

 

•  senior management succession

 

•  our corporate responsibility, sustainability and philanthropy; and

 

•  political participation and contributions

 

 

In addition, each of the Committees meets in executive session with management to discuss our risks and exposures. For example, the Audit and Risk Committee meets regularly with our Chief Risk Officer, General Counsel, Vice Chairman and Chief Financial Officer, Chief Auditor and other members of senior management to discuss our major risk exposures and other programs.

 

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Stockholder Engagement on Corporate Governance, Corporate Responsibility and Executive Compensation Matters

Our Board and management team greatly value the opinions and feedback of our stockholders, which is why we have proactive, ongoing engagement with our stockholders throughout the year focused on corporate governance, corporate responsibility and executive compensation, in addition to the ongoing dialogue among our stockholders and our Chairman and Chief Executive Officer, Vice Chairman and Chief Financial Officer and Investor Relations team on Visa’s financial and strategic performance. Our Lead Independent Director and Chairman and Chief Executive Officer met with several of our investors this year to discuss corporate governance, corporate responsibility and executive compensation matters.

 

 

LOGO

 

Prior to Annual Meeting

 

•  We reach out to our top 50 investors to discuss corporate governance, corporate responsibility and executive compensation matters, and solicit feedback.

 

•  Our Board is provided with our stockholders’ feedback for consideration.

 

•  Board and management discuss feedback and whether action
should be taken.

 

•  Disclosure enhancements are considered.

 

•  We review vote proposals and solicit support for Board recommendations on management and stockholder proposals.

 

  LOGO   

Annual Meeting of Stockholders

 

Our stockholders vote on election of directors, executive compensation, ratification of our auditors and other management and stockholder proposals.

  LOGO  

Post Annual Meeting

 

•  Our Board and management review the vote results from our annual meeting.

 

•  Board and management discuss vote results and whether action should be taken.

 

•  We start preparing our agenda for our next proxy season outreach.

 

Feedback from this year’s investor meetings was positive overall with many investors expressing appreciation for the increased transparency in our disclosures on corporate governance, executive compensation and corporate responsibility matters. Topics covered during our discussions with investors included:

 

   

impact of COVID-19 on operations and employees

 

   

board composition, including diversity and skills criteria

 

   

board risk oversight, including cybersecurity and business continuity

 

   

our executive compensation program and philosophy

 

   

corporate responsibility and sustainability, including human capital management

A summary of the feedback we received was discussed and considered by the Board, and enhancements have been made to our disclosures to improve transparency in these areas.

Stockholders and other interested parties who wish to communicate with us on these or other matters may contact our Corporate Secretary electronically at corporatesecretary@visa.com or by mail at Visa Inc., P.O. Box 193243, San Francisco, CA 94119.

 

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Communicating with the Board of Directors

Our Board has adopted a process by which stockholders or other interested persons may communicate with the Board or any of its members. Stockholders and other interested parties may send communications in writing to any or all directors (including the Chair or the non-employee directors as a group) electronically to board@visa.com or by mail c/o our Corporate Secretary, Visa Inc., P.O. Box 193243, San Francisco, CA 94119. Communications that meet the procedural and substantive requirements of the process approved by the Board will be delivered to the specified member of the Board, non-employee directors as a group or all members of the Board, as applicable, on a periodic basis, which generally will be in advance of or at each regularly scheduled meeting of the Board. Communications of a more urgent nature will be referred to the General Counsel, who will determine whether it should be delivered more promptly. Additional information regarding the procedural and substantive requirements for communicating with our Board may be found on our website at http://investor.visa.com, under “Corporate Governance – Contact the Board.”

All communications involving accounting, internal accounting controls, and auditing matters, possible violations of, or non-compliance with, applicable legal and regulatory requirements or the Codes, or retaliatory acts against anyone who makes such a complaint or assists in the investigation of such a complaint, may be made via email to businessconduct@visa.com; through our Confidential Compliance Hotline at (888) 289-9322 or our Confidential Online Compliance Hotline at https://visa.alertline.com; or by mail to Visa Inc., Business Conduct Office, P.O. Box 193243, San Francisco, CA 94119. All such communications will be handled in accordance with our Whistleblower Policy, a copy of which may be obtained by contacting our Corporate Secretary.

Attendance at Board, Committee and Annual Stockholder Meetings

Our Board and its committees meet throughout the year on a set schedule, hold special meetings as needed, and act by written consent from time to time. The Board met 10 times during fiscal year 2020. Each director attended at least 92% or more of the aggregate of: (i) the total number of meetings of the Board held during the period in fiscal year 2020 for which he or she served as a director, and (ii) the total number of meetings held by all committees of the Board on which such director served as a member during the period in fiscal year 2020. The total number of meetings held by each committee is listed below, under the heading Committees of the Board of Directors. It is our policy that all members of the Board should endeavor to attend the annual meeting of stockholders. All of our then current directors attended the 2020 Annual Meeting of Stockholders. Ms. Rendle joined the Board in November 2020 and, therefore, did not attend the 2020 Annual Meeting.

Codes of Conduct and Ethics

Our Board has adopted a Code of Business Conduct and Ethics, which applies to all directors, officers, employees and contingent staff of the Company. This Code includes a supplemental Code of Ethics for Certain Executives and Financial Officers, which applies to our Chief Executive Officer, Chief Financial Officer, Controller, General Counsel and other senior financial officers, whom we refer to collectively as senior officers. These Codes require the senior officers to engage in honest and ethical conduct in performing their duties, provide guidelines for the ethical handling of actual or apparent conflicts of interest between personal and professional relationships, and provide mechanisms to report unethical conduct. Our senior officers are held accountable for their adherence to the Codes. If we amend or grant any waiver from a provision of our Codes for officers or directors, we will publicly disclose such amendment or waiver in accordance with and if required by applicable law, including by posting such amendment or waiver on our website at http://investor.visa.com or by filing a current report on Form 8-K with the Securities and Exchange Commission (SEC).

 

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Political Engagement and Disclosure

Public sector decisions significantly affect our business and industry, as well as the communities in which we operate. For this reason, we participate in the political process through regular and constructive engagement with government officials and policy-makers, by encouraging the civic involvement of our employees, and by contributing to candidates and political organizations where permitted by applicable law. We are committed to conducting these activities in a transparent manner that reflects responsible corporate citizenship and best serves the interests of our stockholders, employees, and other stakeholders. Additional information regarding our political activities and oversight may be found at https://usa.visa.com/about-visa/operating-responsibly.html.

Visa has a Political Participation, Lobbying and Contributions Policy (the “Policy”) that prohibits our directors, officers and employees from using Company resources to promote their personal political views, causes or candidates, and specifies that the Company will not directly or indirectly reimburse any personal political contributions or expenses. Directors, officers and employees also may not lobby government officials on the Company’s behalf absent the pre-approval of the Company’s Global Government Engagement department. As such, our lobbying and political spending seek to promote the interests of the Company and its stockholders, and not the personal political preferences of our directors or executives.

Under the Policy, the Nominating and Corporate Governance Committee must pre-approve the use of corporate funds for political contributions, including contributions made to trade associations to support targeted political campaigns and contributions to organizations registered under Section 527 of the U.S. Internal Revenue Code to support political activities. The Policy further requires the Company to make reasonable efforts to obtain from U.S. trade associations whose annual membership dues exceed $25,000 the portion of such dues that are used for political contributions. This information must then be included in the annual contributions report that is posted on our website.

We endeavor to maintain a healthy and transparent relationship with governments around the world by communicating our views and concerns to elected officials and policy-makers. As an industry leader, we encounter challenges and opportunities on a wide range of policy matters. These issues may include regulations and policies on interchange fees, cybersecurity, data security, privacy, intellectual property, surcharging, payroll and prepaid cards, mobile payments, tax, international trade and market access, and financial inclusion, among others.

The Nominating and Corporate Governance Committee annually reviews our political contributions and lobbying expenditures, which includes information regarding memberships in, or payments to, tax-exempt organizations that write and endorse model legislation. Additional information on our political contributions and lobbying expenditures can be found on our website, including our annual contributions report and links to our quarterly U.S. federal lobbying activities and expenditures reports.

In 2020, the Center for Political Accountability assessed our disclosures for its annual CPA-Zicklin Index of Corporate Political Disclosure and Accountability, and designated Visa a “Trendsetter” (the highest designation in the CPA-Zicklin Index).

Corporate Responsibility and Sustainability

We believe that as a trusted brand in payments, Visa has an opportunity and responsibility to contribute to a more inclusive, equitable and sustainable world. As we work toward this goal, we are committed to managing the risks and opportunities that arise from ESG issues.

 

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Integrated Approach

As detailed below, Visa takes an integrated approach to managing ESG performance and transparency, which consists of governance, engagement and reporting on our initiatives.

 

   

Strategy / Materiality: To inform our corporate responsibility and sustainability strategy, Visa maintains engagement with various stakeholder groups. We also conduct a biennial ESG materiality assessment in accordance with ESG reporting guidelines and reassess our approach to managing priority topics during interim years. We organize and calibrate our corporate responsibility and sustainability strategy around these topics.

 

   

Governance: At Visa, corporate responsibility and sustainability activities are managed at a functional level across our strategic and operational areas, with executive and Board oversight. Our Chief Sustainability Officer is responsible for leading the development and oversight of our global ESG efforts. In addition, the Visa Corporate Responsibility and Sustainability Leadership Council serves as a central coordinating body facilitating our ESG strategy and reporting efforts. The Leadership Council includes cross-functional representation from more than a dozen senior leaders. The Nominating and Corporate Governance Committee of the Board has formal responsibility to oversee and review our management of ESG matters, including overall ESG strategy, stakeholder engagement, formal reporting, and policies and programs in specific areas such as environmental sustainability, climate change, human rights, political activities and expenditures, social impact and philanthropy.

 

   

Engagement: Understanding the views and concerns of Visa stakeholders supports our work across our business and ESG strategic priorities. We regularly engage with our stakeholders to help inform our ESG strategy, priorities and actions.

 

   

Reporting: We are committed to operating with transparency, including through our annual Visa Corporate Responsibility and Sustainability Report as well as additional ESG disclosures and submissions.

 

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Key Focus Areas of ESG Strategy and Recent Progress

Our corporate responsibility and sustainability strategy focuses on priority issues in five areas, each informed by our materiality assessment and stakeholder engagement.

 

LOGO

 

 

 Digitally enabling 50M small/micro businesses worldwide through programs, solutions and partnerships

 

 Formed the Visa Economic Empowerment Institute focused on economic and societal issues

 

 Achieved our 2015 goal to provide 500M unbanked or underserved people with access to a Visa branded payment account by 2020

 

 Committed $210M from the Visa Foundation for pandemic relief and longer-term small/micro business recovery

 

 Supported women’s economic empowerment through new partnerships with iFundWomen and Hand in Hand International, our She’s Next and She Trades initiatives, and our expanded sponsorship of women athletes, teams and sports events

 

 

 Highest rating in our sector from Gartner Consulting during our 2020 Cybersecurity program review

 

 Decreased overall payment fraud volume during an unprecedented volatility in spend patterns and active/creative fraud attacks

 

 Partnered across the payments ecosystem to share payment intelligence that identified and prevented fraud attacks worldwide

 

 Implemented the California Consumer Privacy Act (CCPA) and prepared for other pending privacy regulations

 

 Matured our Data Use Council and provided global training on data use principles

 

 

 Supported our employees during COVID-19 through expanded opportunities for remote work, specialized engagement initiatives, broadened childcare and benefit offerings, wellbeing investment/resources, and a commitment to no pandemic-related layoffs in 2020

 

 Created a three-pronged approach to support racial equality including establishing a $10M Visa Black Scholars & Jobs program, ongoing education through a newly created Race Talks series, and increased reporting and tracking of diversity metrics through quarterly business reviews with the Executive Committee

 

 Represented by our Chairman and CEO on the board of directors of Catalyst, a non-profit focused on gender equity research and best practices

 

 Joined Gender and Diversity KPI Alliance (GDKA) to support measurement of gender and diversity progress

 

 Introduced the Visa Learning Hub, our new AI-powered platform for learning that brings together more than 80,000 resources from Visa and our world-class providers

 

 Hosted the second Visa Learning Festival dedicated to virtual learning focused on a growth mindset

 

 

 Transitioned to 100% renewable electricity across our offices and data centers

 

 Issued our inaugural $500M green bond to finance the transition to low-carbon operations and economy

 

 Launched with CPI Card Group the Earthwise high-content, upcycled payment card

 

 Advanced our sustainable living initiatives, including support of a 27-market study on Healthy & Sustainable Living, lead sponsorship of Netflix’s “Down to Earth w/ Zac Efron” and participation in Travalyst (sustainable travel) and Brands for Good

 

 Participated in education and advocacy in support of climate change policy action

 

 

 Recognized as a “Trendsetter” for the fifth consecutive year by the Center for Political Accountability for our disclosures related to corporate political contributions

 

 Expanded paid time off for voting in U.S. and joined the Time to Vote Coalition to support our employees in exercising their right to vote

 

 Maturing our business and human rights program, by completing our Human Rights Impact Assessment and ongoing involvement in the Centre for Sport & Human Rights

 

 Expanded supplier diversity program and continued implementation of Visa Supplier Code of Conduct

 

 

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Third Party Recognition of our Progress

We continued to receive recognition of our ESG leadership by third-party organizations:

 

   

Dow Jones Sustainability North America Index – In 2020, placed on DJSI for fourth consecutive year

 

   

FTSE4Good Index – Continued to be named to this Index

 

   

MSCI – Maintained “A” rating

 

   

Sustainalytics – Low Risk – ESG Risk Rating

 

   

America’s 100 Most Just Companies

 

   

100 Best Corporate Citizens 2020

 

   

World’s Most Ethical Companies – Named for the eighth consecutive time in 2020

 

   

America’s Most Responsible Companies 2020

 

   

Global 2000 World’s Best Employers

 

   

Best Employers for Diversity

We encourage you to read more about how we are working to build a more inclusive, equitable and sustainable world for everyone, everywhere on our website and in our 2019 Corporate Responsibility & Sustainability Report. Our 2019 Corporate Responsibility & Sustainability Report is not part of or incorporated by reference into this proxy statement.

 

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COMMITTEES OF THE BOARD OF DIRECTORS

The current standing committees of the Board are the Audit and Risk Committee, the Compensation Committee, the Finance Committee, and the Nominating and Corporate Governance Committee. Each of the standing committees operates pursuant to a written charter, which are available on the Investor Relations page of our website at http://investor.visa.com under “Corporate Governance – Committee Composition.”

 

   

Audit and Risk Committee

 

    
         
         
         

 

  Committee members:

  Lloyd A. Carney*, Chair

  Ramon Laguarta

  Denise M. Morrison*

  Suzanne Nora Johnson*

  John A. C. Swainson*

 

      * Audit Committee Financial Expert

 

  Number of meetings in
  fiscal year 2020: 7

 

 

    

“In 2020, we faced unique challenges due to the COVID-19 pandemic and as a result, the Committee focused on Visa’s operational resiliency, and key risks, including credit settlement, technology, cybersecurity, fraud and supplier risks.”

 

– Lloyd A. Carney, Chair

 

 

LOGO

 

  

Key Activities in 2020

 

 

Monitored the integrity of our financial statements, our compliance with legal and regulatory requirements, our internal control over financial reporting and the performance of our internal audit function and KPMG, our independent registered public accounting firm;

 

Discussed the qualifications and independence of KPMG and recommended their re-appointment for FY2020;

 

Selected, approved the compensation of, and oversaw the work of KPMG, including the scope of and plans for the audit for FY2021;

 

Reviewed and discussed with management the disclosures required to be included in our annual report on Form 10-K and our quarterly reports on Form 10-Q, including the Company’s significant accounting policies, and areas subject to significant judgment and estimates;

 

Discussed with KPMG their critical audit matters;

 

Approved fees for KPMG for FY2020 and all audit, audit-related and non-audit fees and services consistent with our pre-approval policy;

 

On a quarterly basis, reviewed audit results and findings prepared by internal audit;

 

Reviewed and recommended the Board approve amendments to our Audit and Risk Committee charter;

 

Monitored compliance with our Code of Business Conduct and Ethics, and reviewed the implementation and effectiveness of the Company’s compliance and ethics program;

 

Reviewed and discussed with management the Company’s financial risks, top risks and other risk exposures and the steps taken to monitor and control those exposures, including our enterprise risk framework and programs, and our acquired entities risk profiles;

 

Monitored the Company’s technology risks, including business continuity, privacy and data protection, and cybersecurity;

 

Reviewed and approved the FY2020 Global Business Continuity Program plan, Risk Appetite Framework, M&A Framework, the FY2020 internal audit plan and the Internal Audit Charter;

 

Reviewed the Company’s insurance coverage and programs;

 

Reviewed and approved our Related Person Transactions Policy, ARC Pre-approval Policy and the Policy on Hiring of Employees and Former Employees of KPMG; and

 

Reviewed and approved the Company’s Whistleblower Policy, procedures for the receipt, retention and treatment of complaints we receive including regarding accounting, internal accounting controls or auditing matters and the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters.

 

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Certain Relationships and Related Person Transactions

The Audit and Risk Committee has adopted a written Statement of Policy with respect to Related Person Transactions (the “Statement of Policy”), governing any transaction, arrangement or relationship between the Company and any related person where the aggregate amount involved will or may be expected to exceed $120,000 and any related person had, has or will have a direct or indirect material interest. Under the Statement of Policy, the Audit and Risk Committee reviews related person transactions and may approve or ratify them only if it is determined that they are in, or not inconsistent with, the best interests of the Company and its stockholders. When reviewing a related person transaction, the Audit and Risk Committee may take into consideration all of the relevant facts and circumstances available to it, including: (i) the material terms and conditions of the transaction or transactions; (ii) the related person’s relationship to Visa; (iii) the related person’s interest in the transaction, including their position or relationship with, or ownership of, any entity that is a party to or has an interest in the transaction; (iv) the approximate dollar value of the transaction; (v) the availability from other sources of comparable products or services; and (vi) an assessment of whether the transaction is on terms that are comparable to the terms available to us from an unrelated third party.

In the event we become aware of a related person transaction that was not previously approved or ratified under the Statement of Policy, the Audit and Risk Committee will evaluate all options available, including ratification, revision or termination of the related person transaction. The Statement of Policy is intended to augment and work in conjunction with our other policies that include code of conduct or conflict of interest provisions, including our Code of Business Conduct and Ethics.

We engage in transactions, arrangements and relationships with many other entities, including financial institutions and professional organizations, in the ordinary course of our business. Some of our directors, executive officers, greater than five percent stockholders and their immediate family members, each a related person under the Statement of Policy, may be directors, officers, partners, employees or stockholders of these entities. We carry out transactions with these entities on customary terms, and, in many instances, our directors and executive officers may not be aware of them. To our knowledge, since the beginning of fiscal year 2020, no related person has had a material interest in any of our business transactions or relationships.

 

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Report of the Audit and Risk Committee

The Committee, composed of independent directors, is responsible for monitoring and overseeing Visa’s financial reporting process on behalf of the Board. The functions of the Committee are described in greater detail in the Audit and Risk Committee Charter, adopted by the Board, which may be found on the Company’s website at http://investor.visa.com under “Corporate Governance – Committee Composition.” Visa’s management has the primary responsibility for establishing and maintaining adequate internal financial controls, for preparing the financial statements, and for the public reporting process. KPMG LLP, Visa’s independent registered public accounting firm, is responsible for expressing opinions on the conformity of the Company’s audited financial statements with accounting principles generally accepted in the United States of America, and on the Company’s internal control over financial reporting.

In this context, the Committee has reviewed and discussed with management the Company’s audited consolidated financial statements for the fiscal year ended September 30, 2020. In addition, the Committee has discussed with KPMG the matters required to be discussed by the applicable requirements of the Public Company Accounting Oversight Board (PCAOB) and the Securities and Exchange Commission.

The Committee also has received the written disclosures and the letter from KPMG required by the applicable requirements of the PCAOB regarding the independent registered public accounting firm’s communications with the audit committee concerning independence, and the Committee has discussed the independence of KPMG with that firm. The Committee also has considered whether KPMG’s provision of non-audit services to the Company impairs the auditor’s independence, and concluded that KPMG is independent from the Committee, the Company and the Company’s management.

Based on the Committee’s review and discussions noted above, the Committee recommended to the Board that the Company’s audited consolidated financial statements be included in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2020, for filing with the Securities and Exchange Commission.

Audit and Risk Committee of the Board of Directors

Lloyd A. Carney (Chair)

Ramon Laguarta

Denise M. Morrison

Suzanne Nora Johnson

John A. C. Swainson

 

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Table of Contents
   

Compensation Committee

 

    
       
       
       

 

  Committee members:

Francisco Javier Fernández-Carbajal

John F. Lundgren

Robert W. Matschullat

Denise M. Morrison, Chair

Maynard G. Webb, Jr.

 

  Number of meetings in

  fiscal year 2020: 7

 

  

“During this extraordinary year, the Committee was actively involved in ensuring that Visa’s compensation program remained aligned with our pay for performance philosophy and our stockholders’ interests. The Committee focused on ensuring that the compensation program is a fair reflection of corporate and individual performance, while motivating and retaining high-performing executives, mitigating compensation-related risks, and recognizing the continued uncertainty caused by COVID-19.”

 

– Denise M. Morrison, Chair

 

  LOGO   

Key Activities in 2020

 

 

Reviewed the overall executive compensation philosophy for the Company;

 

Reviewed and approved corporate goals and objectives relevant to our Chief Executive Officer’s and other named executive officers’ compensation, including annual performance objectives;

 

Carefully monitored and assessed the impact of COVID-19 on the executive compensation program and considered the appropriateness of the program by reference to its guiding principles, including pay for performance, alignment with stockholders’ interests, and motivation and retention of key talent;

 

Evaluated the performance of our Chief Executive Officer and other named executive officers in light of corporate and individual goals and objectives and, based on this evaluation, determined, approved and reported to the Board the annual compensation of our Chief Executive Officer and other named executive officers, including salary, bonus, equity and other benefits;

 

Reviewed and recommended to the independent members of the Board the form and amount of compensation of our directors;

 

Oversaw administration and regulatory compliance with regard to the Company’s incentive and equity-based compensation plans, and in October 2020 recommended amendments to the equity incentive plan to the Board;

 

Reviewed the operations of the Company’s executive compensation program to determine whether they are properly coordinated and achieving their intended purposes;

 

Reviewed an annual compensation-risk assessment report and considered whether the Company’s compensation policies and practices contain incentives for executive officers and employees to take risks in performing their duties that are reasonably likely to have a material adverse effect on the Company;

 

Reviewed the Company’s stock ownership guidelines for directors and named executive officers, as well as individual compliance;

 

Reviewed and recommended the Board approve amendments to our Compensation Committee charter;

 

Reviewed and discussed with management the compensation disclosures required to be included in the Company’s annual filings;

 

Oversaw the Company’s submissions to a stockholder vote on executive compensation matters, including the advisory vote on executive compensation (“Say-on-Pay”);

 

Reviewed the results of stockholder votes on executive compensation matters and discussed with management the appropriate engagement with stockholders in response to the votes;

 

Selected an appropriate peer group for executive pay and performance comparisons;

 

Reviewed the Company’s programs and practices related to executive workforce diversity and the administration of the executive compensation program in a non-discriminatory manner; and

 

Received and reviewed updates on regulatory and compensation trends and compliance.

 

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Compensation Committee Interlocks and Insider Participation

None of the members who served on the Compensation Committee (Denise M. Morrison, Francisco Javier Fernández-Carbajal, John F. Lundgren (since April 21, 2020), Robert W. Matschullat, Suzanne Nora Johnson (until February 1, 2020), and Maynard G. Webb, Jr.) was or had ever been one of our officers or employees. In addition, during the last fiscal year, none of our executive officers served as a member of the board of directors or the compensation committee of any other entity that has one or more executive officers serving on our Board or Compensation Committee.

Risk Assessment of Compensation Programs

The Compensation Committee annually considers potential risks when reviewing and approving our compensation program. We have designed our compensation program, including our incentive compensation plans, with specific features to address potential risks while rewarding employees for achieving long-term financial and strategic objectives through prudent business judgment and appropriate risk-taking. The following elements have been incorporated in our compensation program for executive officers:

 

LOGO

 

     

LOGO

 

     

LOGO

 

     

A Balanced Mix of Compensation Elements

 

•  The compensation mix for our executive officers is composed of salary, annual cash incentives and long-term equity incentives, representing a mix that is not overly weighted toward short-term cash incentives.

 

 

     

Multiple Performance Factors

 

•  Our incentive compensation plans use multiple Company-wide metrics and individual performance goals, which encourage the achievement of objectives for the overall benefit of the Company.

     

Long-Term Incentives

 

•  Our long-term incentives are equity-based and generally have a three-year vesting schedule to complement our annual cash-based incentives.

 

LOGO

 

     

LOGO

 

     

LOGO

 

     

Capped Incentive Awards

 

•  Annual incentive awards and performance share awards are capped at 200% of target for executive officers.

     

Stock Ownership Guidelines

 

•  Our guidelines call for significant stock ownership, which aligns the interests of our executive officers with the long-term interests of our stockholders.

     

Recoupment Policies

 

•  Our Clawback Policy authorizes the Board to recover past incentive compensation or cancel outstanding awards in the event of a material restatement of the Company’s financial results due to fraud, intentional misconduct or gross negligence of the executive officer.

 

•  Our equity award agreements also provide for forfeiture of equity-based awards in the event of specified detrimental activity in the absence of a restatement.

 

 

Additionally, the Compensation Committee annually considers an assessment of compensation-related risks. Based on this assessment, the Compensation Committee concluded that our compensation program does not create risks that are reasonably likely to have a material adverse effect on Visa. In making this determination, the Compensation Committee reviewed the key design elements of our compensation program in relation to industry “best practices” as presented by Frederic W. Cook & Co. (FW Cook), the Compensation Committee’s independent compensation consultant, as well as the means of mitigating potential risks, such as through our internal controls and oversight by management and the Board. In addition, management completed an inventory

 

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of incentive programs below the executive level and reviewed the design of these incentives both internally and with external legal counsel to conclude that such programs do not encourage excessive risk-taking.

 

 

Compensation Committee Report

 

The Compensation Committee has:

 

•   reviewed and discussed the section entitled Compensation Discussion and Analysis with management; and

 

•   based on this review and discussion, the Compensation Committee recommended to the Board that the Compensation Discussion and Analysis section be included in this proxy statement.

 

COMPENSATION COMMITTEE

 

Denise M. Morrison (Chair)

Francisco Javier Fernández-Carbajal

John F. Lundgren

Robert W. Matschullat

Maynard G. Webb, Jr.

 

 

 

   

Finance Committee

 

    
         
         
         

 

  Committee members:

  Mary B. Cranston

  Francisco Javier Fernández-Carbajal

  Robert W. Matschullat, Chair

  Linda J. Rendle (effective   November 23, 2020)

  Maynard G. Webb, Jr.

 

  Number of meetings in
  fiscal year 2020: 8

 

    

“The Committee was active in 2020, reviewing several potential M&A transactions and strategic investments, including the proposed acquisition of Plaid, in addition to discussing Visa’s capital structure, financial condition, capital investments, treasury activities and tax strategy.”

 

– Robert W. Matschullat, Chair

 

 

LOGO

 

  

Key Activities in 2020

 

 

Reviewed several potential M&A transactions and strategic investments, including the proposed acquisition of Plaid;

 

Reviewed the financial and operational performance of prior acquisitions, including integration scorecards;

 

Reviewed and recommended the Company’s quarterly dividend and a $9.5 billion increase to the Class A share buyback program;

 

Reviewed the Company’s capital structure and financial condition, including target leverage ratio and credit ratings;

 

Discussed the Company’s tax strategy;

 

Reviewed insurance coverage and programs;

 

Discussed the Company’s treasury activities and strategy; and

 

Reviewed potential capital investments in advance of FY21 budget approval.

 

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Nominating and Corporate Governance Committee

 

    
         

 

  Committee members:

  Mary B. Cranston

  Ramon Laguarta

  John F. Lundgren

  Suzanne Nora Johnson

  Linda J. Rendle (effective

  November 23, 2020)

  John A. C. Swainson, Chair

 

  Number of meetings in
  fiscal year 2020: 3

 

    

 

“This year we focused on management succession planning, board composition, including the addition of Ramon Laguarta and Linda Rendle to the Board, and oversight of Visa’s ESG and shareholder engagement programs.”

 

– John A. C. Swainson, Chair

 

 

LOGO

  

Key Activities in 2020

 

 

Identified, selected and recommended a new director, Linda J. Rendle, to serve as a member of the Board, Finance Committee and Nominating and Corporate Governance Committee, effective November 23, 2020;

 

Recommended to the Board changes to the leadership of the Board’s committees, which resulted in rotating the Compensation Committee Chair;

 

Reviewed the criteria used to identify individuals qualified to become directors to ensure it aligns with our current business needs and long-term strategy;

 

Regularly discussed board composition and reviewed director candidates in light of our director qualification criteria, current business needs and long-term strategy;

 

Reviewed and recommended updates to the Company’s governance practices and policies, which were approved by the Board, including:

   

Bylaws/Certificate of Incorporation, which were revised to include an emergency bylaw provision in the Bylaws, and to permit Class A common stockholders a right to call a special meeting (subject to stockholder approval of Proposal 5);

   

Corporate Governance Guidelines, which were revised to reflect addition of the Finance Committee and reflect current practices regarding board evaluation, director orientation and management succession planning; and

   

Nominating and Corporate Governance Committee Charter, which was updated to reflect current practices regarding ESG oversight and board evaluation.

 

Reaffirmed the Board’s categorical director independence standards, and reviewed the qualifications and determined the independence of the members of the Board and its committees;

 

Reviewed each director’s compliance with the requirements of the Corporate Governance Guidelines relating to service on other boards or audit committees of publicly-traded companies;

 

Reviewed succession and development plans for management, including the succession plan for the Chief Executive Officer in the event of an emergency or retirement;

 

Oversaw the annual evaluation of the Board, its committees and directors;

 

Oversaw our stockholder engagement program on corporate governance, corporate responsibility and executive compensation matters;

 

Discussed two stockholder proposals (Proposals 6 and 7) with management and the Board;

 

Reviewed and approved the 2020 corporate political contribution plan, and oversaw the Company’s political contributions and lobbying activities; and

 

Reviewed corporate responsibility and sustainability developments and oversaw the Company’s charitable giving.

 

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Process for Nomination of Director Candidates

The Nominating and Corporate Governance Committee regularly reviews the composition of the Board, including the qualifications, expertise and characteristics that are represented in the current Board as well as the criteria it considers needed to support Visa’s long-term strategy. After an in-depth review of the candidates, the Nominating and Corporate Governance Committee recommends candidates to the Board in accordance with its charter, our Certificate of Incorporation and Bylaws, our Corporate Governance Guidelines and the criteria adopted by the Board regarding director candidate qualifications. After careful review and consideration, the Board will nominate candidates for election, or re-election, at our annual meeting of stockholders. The Board may appoint a director to the Board during the course of the year to serve until the next meeting of stockholders.

 

   

 

Sources for
Candidate Pool

 

         

 

In-Depth
Review

         

 

Full Board
Review

         

 

Board
Nominates

       
   

   Independent directors

 

   Independent search firm

 

   Our management

 

   Stockholders

    LOGO    

   Consider skills matrix

 

   Consider diversity

 

   Review independence and potential conflicts

 

For New Candidates:

 

   Screen qualifications

 

   Meet with our directors

    LOGO     Review selected candidates for election / appointment at recommendation by NCGC     LOGO     Candidates for election to Board at Annual Meeting of Stockholders / appoints to Board during the year     LOGO   LOGO
                                                                         

Stockholder Recommended Candidates

Stockholders may recommend a director candidate to be considered for nomination by the Nominating and Corporate Governance Committee by providing the information specified in our Corporate Governance Guidelines to our Corporate Secretary within the timeframe specified for stockholder nominations of directors in our Bylaws. For additional information regarding the process for proposing director candidates to the Nominating and Corporate Governance Committee for consideration, please see our Corporate Governance Guidelines. Stockholders who wish to nominate a person for election as a director at an annual meeting of stockholders must follow the procedure described under the heading Other Information – Stockholder Nomination of Director Candidates and Other Stockholder Proposals for 2022 Annual Meeting on page 125 of this proxy statement. For additional information regarding this process, please see our Bylaws.

 

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Criteria for Nomination to the Board of Directors and Diversity

The Nominating and Corporate Governance Committee applies the same standards in considering director candidates submitted by stockholders as it does in evaluating other candidates, including incumbent directors. The identification and selection of qualified directors is a complex and subjective process that requires consideration of many intangible factors and will be significantly influenced by the particular needs of the Board from time to time. As a result, there is no specific set of minimum qualifications, qualities or skills that are necessary for a nominee to possess, other than those that are necessary to meet U.S. legal, regulatory and NYSE listing requirements and the provisions of our Certificate of Incorporation, Bylaws, Corporate Governance Guidelines and charters of the Board’s committees. However, the Nominating and Corporate Governance Committee and the Board have identified the ten skills and qualifications listed below as important criteria for membership on the Visa Board.

 

 
 
LOGO   LOGO   LOGO   LOGO   LOGO
Payments   Technology   Senior
Leadership
 

Public Company

Boards

  Financial
 
 
LOGO   LOGO   LOGO   LOGO   LOGO

Global

Markets

 

Marketing |

Brand

  Risk  

Government |

Geo-political

  ECommerce | Mobile
 
 

In addition to the above qualities, the Board, through the Nominating and Corporate Governance Committee, strives to be a board which reflects the diversity of our key constituencies around the world (clients, customers, employees, business partners and stockholders). While the Board does not have a formal policy on diversity, in assembling our Board, our objective is to have wide diversity in terms of business experiences, functional skills, gender, race, ethnicity and cultural backgrounds. To support this objective, the Nominating and Corporate Governance Committee considers women and minority candidates in the pool from which the Nominating and Corporate Governance Committee considers director candidates.

 

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COMPENSATION OF NON-EMPLOYEE DIRECTORS

We compensate non-employee directors for their service on the Board with a combination of cash and equity awards, the amounts of which are commensurate with their role and involvement, and consistent with peer company practices. In setting director compensation, we consider the significant amount of time our directors expend in fulfilling their duties as well as the skill level required of members of our Board. We intend to compensate our non-employee directors in a way that is competitive, attracts and retains a high caliber of directors, and aligns their interests with those of our stockholders. Mr. Kelly, our Chairman and Chief Executive Officer, does not receive additional compensation for his service as a director.

The Compensation Committee, which is composed solely of independent directors, has the primary responsibility for reviewing and considering any revisions to our director compensation program. The Compensation Committee undertook its annual review of the type and form of compensation paid to our non-employee directors in connection with their service on the Board and its committees for fiscal year 2020, which included an independent analysis completed by FW Cook. As part of this analysis, FW Cook reviewed non-employee director compensation trends and data from peer companies used by the Compensation Committee in connection with its review of executive compensation. Pursuant to the review, and after considering FW Cook’s advice on peer group data, the Compensation Committee approved an increase of the annual cash retainer for non-employee directors to $110,000 from $105,000, effective October 1, 2019, and an increase in the grant date value of the annual equity grant for non-employee directors to $215,000 from $200,000 for grants made on or after the date of the 2020 Annual Meeting of Stockholders. Further, the Compensation Committee approved an increase in the annual cash retainer for membership in each of the Compensation Committee, Finance Committee, and Nominating and Corporate Governance Committee to $15,000 from $10,000, effective October 1, 2019.

Highlights of our Non-Employee Director Compensation Program

AMONG THE HIGHLIGHTS OF OUR PROGRAM ARE:

 

 

 

LOGO

 

 

No Fees for Board or Committee Meeting Attendance: Meeting attendance is an expected part of board service.

 

LOGO

 

 

 

Emphasis on Equity: There is an emphasis on equity in the overall compensation mix to further align interests with stockholders.

 

LOGO

 

 

Recognition of Special Roles: Special roles (such as Lead Independent Director and Committee Chairs) are fairly recognized for their additional time commitments.

 

LOGO

 

 

Formulaic Annual Equity Grants with Immediate Vesting: Equity awards are granted annually under a fixed-value formula with immediate vesting to support independence.

 

LOGO

 

 

Robust Stock Ownership Guidelines: A guideline of five times the annual board membership cash retainer supports alignment with stockholders’ interests.

 

LOGO

 

 

 

 

Limited Perquisites and No Related Tax Gross-Ups: Other benefits, such as matching charitable contributions, are limited.

 

 

 

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Annual Retainers Paid in Cash

Each non-employee director receives an annual cash retainer for his or her service on the Board, as well as additional cash retainers if he or she serves as the Lead Independent Director, on a committee or as the chair of a committee. The following table lists the cash retainer amounts in effect during fiscal year 2020.

 

  Type of Retainer    Amount of Retainer
 

  Annual Board Membership

   $110,000
 

  Lead Independent Director

   $75,000
 

  Audit and Risk Committee Membership

   $20,000
 

  Compensation Committee Membership

   $15,000
 

  Finance Committee Membership

   $15,000
 

  Nominating and Corporate Governance Committee Membership

   $15,000
 

 

  Audit and Risk Committee Chair

   $25,000

(in addition to member retainer)

 

 

  Compensation Committee Chair

   $20,000

(in addition to member retainer)

 

 

  Finance Committee Chair

   $20,000

(in addition to member retainer)

 

 

  Nominating and Corporate Governance Committee Chair

   $20,000

(in addition to member retainer)

U.S.-based directors may defer the payment of all or a portion of the cash retainer payments. All cash retainers are paid in quarterly installments throughout the year unless a director elected to defer the payment. Directors are also reimbursed for customary expenses incurred while attending meetings of the Board and its committees.

Equity Compensation

Each non-employee director also receives an annual equity grant under our 2007 Equity Incentive Compensation Plan, which limits the total grant date value of equity grants that may be made to our non-employee directors to $500,000 in a single fiscal year. On January 28, 2020, the date of our Annual Meeting of Stockholders, each non-employee director received a restricted stock unit grant determined by dividing $215,000 by the per share closing price of our Class A common stock on that date, rounded to the nearest whole share. Following the date of a director’s election or appointment to the Board on a date other than at an Annual Meeting of Stockholders, the director receives a prorated initial grant based on the partial year of board service. Accordingly, Ramon Laguarta, who was appointed to the board on November 20, 2019, received a restricted stock unit grant determined by dividing $33,333 by the per share closing price of our Class A common stock on December 15, 2019, rounded to the nearest whole share. Restricted stock unit grants to all non-employee directors vest immediately upon grant. Directors may elect to defer settlement of all or a portion of their equity grants.

Stock Ownership Guidelines

The stock ownership guidelines for our non-employee directors specify that each director should own shares of our common stock equal to five times the annual board membership cash retainer. Equity interests that count

 

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toward the satisfaction of these guidelines include shares owned outright by the director, shares jointly owned and restricted stock units payable in shares. Directors have five years from the date they become a member of the Board to attain these ownership levels. Each non-employee director with at least five years of service on our Board currently meets or exceeds the ownership guidelines. We also have an insider trading policy which, among other things, prohibits directors from hedging the economic risk of their stock ownership or pledging their shares.

Charitable Matching Gift Program

Our non-employee directors may participate in our Board Charitable Matching Gift Program. Under this program, Visa will match contributions to eligible non-profit organizations, up to a maximum of $15,000 per director per calendar year. Our non-employee directors may also participate in our Political Action Committee (“PAC”) Charitable Matching Program. Under this program, when non-employee directors make a contribution to the Visa PAC, Visa will match their contribution to a qualifying charity or charities the non-employee director selects, up to a maximum of $5,000 per director per calendar year.

Director Compensation Table for Fiscal Year 2020

The following tables provide information on the total compensation earned by each of our non-employee directors who served during fiscal year 2020. Ms. Rendle was appointed to the Board effective November 23, 2020. As a result, she did not receive director compensation during fiscal year 2020.

 

Name    Fees Earned
or Paid in Cash
($)(1)
   Stock
Awards
($)(2)
   All Other
Compensation
($)(3)
   Total
($)
 

Lloyd A. Carney

    

 

155,000

    

 

215,021

    

 

5,000

    

 

375,021   

 

Mary B. Cranston

    

 

142,500

    

 

215,021

    

 

35,000

    

 

392,521   

 

Francisco Javier Fernández-Carbajal

    

 

140,000

    

 

215,021

    

 

15,000

    

 

370,021   

 

Ramon Laguarta(4)

    

 

108,750

    

 

248,346

    

 

-

    

 

357,096   

 

John F. Lundgren

    

 

203,750

    

 

215,021

    

 

5,000

    

 

423,771   

 

Robert W. Matschullat

    

 

160,000

    

 

215,021

    

 

20,000

    

 

395,021   

 

Denise M. Morrison

    

 

155,000

    

 

215,021

    

 

10,000

    

 

380,021   

 

Suzanne Nora Johnson

    

 

152,500

    

 

215,021

    

 

20,000

    

 

387,521   

 

John A. C. Swainson

    

 

165,000

    

 

215,021

    

 

19,500

    

 

399,521   

 

Maynard G. Webb, Jr.

       140,000        215,021        20,000        375,021   

 

(1)

Additional information describing these fees is included under the heading Fees Earned or Paid in Cash.

 

(2)

Represents the aggregate grant date fair value of the awards granted to each director computed in accordance with stock-based accounting rules (Financial Standards Accounting Board (“FASB”) ASC Topic 718). Assumptions used in the calculation of these amounts are included in Note 17 – Share-based Compensation to our fiscal year 2020 consolidated financial statements, which are included in our Annual Report on Form 10-K filed with the SEC on November 19, 2020 (the “Form 10-K”).

 

(3)

Amounts include the matching contributions we made on behalf of the following directors for fiscal year 2020 pursuant to our Board Charitable Matching Gift Program: $30,000 for Ms. Cranston; $15,000 for each of Mr. Fernández-Carbajal, Mr. Matschullat, Ms. Nora Johnson, and Mr. Webb; $14,500 for Mr. Swainson; and $5,000 for Ms. Morrison. For Ms. Cranston, the amount shown exceeds the charitable match limit of $15,000 for calendar year 2020 because her fiscal year total includes fiscal year 2020 contributions made during calendar year 2019. The amounts also include the $5,000 matching contributions we made on behalf of each of the following directors for fiscal year 2020 pursuant to our PAC Charitable Matching Program: Mr. Carney, Ms. Cranston, Mr. Lundgren, Mr. Matschullat, Ms. Morrison, Ms. Nora Johnson, Mr. Swainson and Mr. Webb.

 

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(4)

Mr. Laguarta received an additional prorated stock award in the form of restricted stock units for his initial partial year of service as a director for the period from his appointment to the Board on November 20, 2019 through January 28, 2020.

Fees Earned or Paid in Cash

The following table sets forth additional information with respect to the amounts reported in the “Fees Earned or Paid in Cash” column in the Director Compensation Table above for fiscal year 2020.

 

Name  

Board

Retainer
($)

 

Independent
Chair/Lead
Independent
Director

Retainer

($)

 

Audit and

Risk
Committee
Chair/
Member
Retainer

($)

 

Compensation
Committee
Chair/
Member
Retainer

($)

 

Finance
Committee
Chair/
Member
Retainer

($)

 

Nominating

and Corporate
Governance
Committee
Chair/

Member
Retainer

($)

Lloyd A. Carney

 

110,000

 

-

 

45,000

 

-

 

-

 

-

Mary B. Cranston

 

110,000

 

-

 

10,000

 

-

 

  7,500

 

15,000

Francisco Javier Fernández-Carbajal

 

110,000

 

-

 

-

 

15,000

 

15,000

 

-

Ramon Laguarta

 

  82,500

 

-

 

15,000

 

-

 

-

 

11,250

John F. Lundgren

 

110,000

 

75,000

 

-

 

  3,750

 

-

 

15,000

Robert W. Matschullat

 

110,000

 

-

 

-

 

15,000

 

35,000

 

-

Denise M. Morrison

 

110,000

 

-

 

20,000

 

25,000

 

-

 

-

Suzanne Nora Johnson

 

110,000

 

-

 

10,000

 

17,500

 

-

 

15,000

John A. C. Swainson

 

110,000

 

-

 

20,000

 

-

 

-

 

35,000

Maynard G. Webb, Jr.

 

110,000

 

-

 

-

 

15,000

 

15,000

 

-

 

Note:

Certain directors rotated Committee assignments during the fiscal year. Fees have been prorated to reflect the portion of the fiscal year that the directors served on the Committee.

Fiscal Year 2021 Director Compensation

After consultation with FW Cook, and pursuant to the annual compensation review process described above, the Compensation Committee determined that it would not make any changes to the non-employee director compensation program for fiscal year 2021.

 

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PROPOSAL 1 – ELECTION OF DIRECTORS

 

LOGO

Our Board currently consists of twelve directors, each of whom is nominated for election at our Annual Meeting, including eleven independent directors and our Chairman and Chief Executive Officer. Each director is elected to serve a one-year term, with all directors subject to annual election.

At the recommendation of the Nominating and Corporate Governance Committee, the Board has nominated the following twelve persons to serve as directors for the term beginning at the Annual Meeting on January 26, 2021: Lloyd A. Carney, Mary B. Cranston, Francisco Javier Fernández-Carbajal, Alfred F. Kelly, Jr., Ramon Laguarta, John F. Lundgren, Robert W. Matschullat, Denise M. Morrison, Suzanne Nora Johnson, Linda J. Rendle, John A. C. Swainson and Maynard G. Webb, Jr. Ms. Rendle was recommended by a non-management director and was vetted by a global search firm. She was nominated by the Nominating and Corporate Governance Committee after an extensive and careful search was conducted by this search firm, and numerous candidates were considered. The primary functions served by the search firm included identifying potential candidates who meet the key attributes, experience and skills described under “Criteria for Nomination to the Board of Directors and Diversity” above, as well as compiling information regarding each candidate’s attributes, experience, skills and independence and conveying the information to the Nominating and Corporate Governance Committee.

Unless proxy cards are otherwise marked, the persons named as proxies will vote all executed proxies FOR the election of each nominee named in this section. Proxies submitted to Visa cannot be voted at the Annual Meeting for nominees other than those nominees named in this proxy statement. However, if any director nominee is unable or unwilling to serve at the time of the Annual Meeting, the persons named as proxies may vote for a substitute nominee designated by the Board. Alternatively, the Board may reduce the size of the Board. Each nominee has consented to serve as a director if elected, and the Board does not believe that any nominee will be

 

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unwilling or unable to serve if elected as a director. Each director will hold office until the next annual meeting of stockholders and until his or her successor has been duly elected and qualified or until his or her earlier resignation or removal.

THE BOARD UNANIMOUSLY RECOMMENDS A VOTE “FOR” EACH OF THE NOMINEES TO SERVE AS DIRECTORS.

Summary of Director Qualifications and Experience

 

 

 

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LOGO

 

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LOGO

 

LOGO

 

LOGO

 

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LOGO

 

LOGO

 

LOGO

 

LOGO

 

                           

 

LOGO

 

 

Payments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOGO

 

 

Technology

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Senior Leadership

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Public Company Boards

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOGO

 

Financial

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Global Markets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Marketing | Brand

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOGO

 

 

Risk

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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Government | Geo-political    

 

 

 

 

 

 

 

 

 

 

 

 

 

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E-Commerce | Mobile

 

 

 

 

 

 

 

 

 

 

Gender Diversity

 

 

 

 

 

 

 

 

 

 

 

African-American / Black

 

 

 

 

Latinx / Spanish Heritage

 

 

 

 

 

 

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Years on Board

 

 

5

 

 

13

 

 

13

 

 

7

 

 

1

 

 

3

 

 

13

 

 

2

 

 

13

 

 

<1

 

 

13

 

 

7

 

 

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DIRECTOR NOMINEE BIOGRAPHIES

The following is additional information about each of the director nominees as of the date of this proxy statement, including their professional background, director positions held currently or at any time during the last five years, and the specific qualifications, experience, attributes or skills that caused the Nominating and Corporate Governance Committee and our Board to determine that the nominee should serve as one of our directors.

 

     

LOGO

Lloyd A. Carney

 

Age: 58

 

Independent

 

Director Since:

June 2015

 

Board Committees:

Audit and Risk

Committee

 

Public Company Directorships:

 

(current) Grid Dynamics Holdings Inc. (Chairman); Nuance Communications, Inc. (Chairman); Vertex Pharmaceuticals; Visa Inc.

(prior) Brocade Communications Systems, Inc., Cypress Semiconductor Corporation; Micromuse, Inc. (Chairman)

 

Career Highlights:

 

•  Chief Acquisition Officer of Carney Technology Acquisition Corp. II, a special purpose acquisition corporation, since September 2020

•  Chief Executive Officer, Carney Global Ventures, LLC, an early round investor, since March 2007

•  Chief Executive Officer and director of Brocade Communications Systems, Inc., a global supplier of networking hardware and software from January 2013 to November 2017

•  Chief Executive Officer and director of Xsigo Systems, an information technology and hardware company, from 2008 to 2012

•  Chief Executive Officer and chairman of the board of Micromuse, Inc., a networking management software company, acquired by IBM, from 2003 to 2006

•  B.S. degree in Electrical Engineering Technology and an Honorary PhD from the Wentworth Institute of Technology, and a M.S. degree in Applied Business Management from Lesley College

 

  

Specific Qualifications, Experience, Attributes and Skills:

 

 

 

LOGO LOGO LOGO LOGO LOGO LOGO LOGO

 

•  Held senior leadership roles at Juniper Networks, Inc., a networking equipment provider, Nortel Networks Inc., a former telecommunications and data networking equipment manufacturer, and Bay Networks, Inc., a computer networking products manufacturer

•  As former Chief Executive Officer for Brocade and prior to that for multiple technology companies, he has extensive experience with information technology, strategic planning, finance and risk management

•  As a director of a number of public and private companies, he has experience with corporate governance, financial reporting and controls, risk management and business strategy and operations

     

LOGO

Mary B. Cranston

 

Age: 72

 

Independent

 

Director Since:

October 2007

 

Board Committees:

Finance Committee;

Nominating and Corporate Governance Committee

 

Public Company Directorships:

 

(current) The Chemours Company; McAfee Corp.; Visa Inc.

(prior) MyoKardia, Inc.; Exponent, Inc.; GrafTech International, Inc.; International Rectifier Corporation; Juniper Networks, Inc.

 

Career Highlights:

 

•  Retired Senior Partner of Pillsbury Winthrop Shaw Pittman LLP, an international law firm

•  Chair and Chief Executive Officer of Pillsbury from January 1999 to April 2006; continued to serve as Chair of the firm until December 2006; Firm Senior Partner until January 2012

•  A.B. degree in Political Science from Stanford University, a J.D. degree from Stanford Law School and a M.A. degree in Educational Psychology from the University of California, Los Angeles

  

Specific Qualifications, Experience, Attributes and Skills:

 

 

LOGO LOGO LOGO LOGO LOGO LOGO LOGO

 

•  Gained a broad understanding of the business and regulation of the financial services industry as well as of the management of a global enterprise through tenure at the Pillsbury law firm

•  Represented banks and financial institutions for over 30 years, and as Chief Executive Officer of the law firm, regularly met with senior executives from banking clients, covering concerns and issues relevant to the financial services industry

•  Oversaw the opening of the firm’s offices in London, Singapore, Sydney and Hong Kong, and expanded the Tokyo office

•  Substantial expertise in complex antitrust, class action and securities law cases and was recognized by the National Law Journal in 2002 as one of the “100 Most Influential Lawyers in America”

•  Regularly reviewed corporate strategies and financial and operational risks as a director of other U.S. publicly-traded companies

•  Identified and managed legal risks for many Fortune 500 companies throughout her legal career

•  Experience and background provide her with significant insight into the legal and regulatory issues facing Visa and its clients, as well as into the challenges of operating a diverse, multinational enterprise

 

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LOGO

Francisco Javier Fernández-Carbajal

 

Age: 65

 

Independent

 

Director Since:

October 2007

 

Board Committees:

Compensation

Committee;

Finance Committee

 

 

Public Company Directorships:

 

(current) ALFA S.A.B. de C.V.; CEMEX S.A.B. de C.V.; Fomento Economico Mexicano, S.A.B. de C.V.; Visa Inc.

(prior) El Puerto de Liverpool, S.A.B. de C.V.; Fresnillo, plc; Grupo Aeroportuario del Pacifico, S.A.B. de C.V.; Grupo Bimbo, S.A.B. de C.V.; Grupo Gigante, S.A.B. de C.V.; Grupo Lamosa, S.A.B. de C.V.; IXE Grupo Financiero S.A.B. de C.V.

 

Career Highlights:

 

•  Consultant for public and private investment transactions and wealth management advisor since January 2002

•  Chief Executive Officer of Servicios Administrativos Contry S.A. de C.V., a privately held company that provides central administrative and investment management services, since June 2005

•  Chief Executive Officer of the Corporate Development Division of Grupo Financiero BBVA Bancomer, S.A., a Mexico-based banking and financial services company that owns BBVA Bancomer, one of Mexico’s largest banks from July 2000 to January 2002; held other senior executive positions at Grupo Financiero BBVA Bancomer since joining in September 1991, serving as President from October 1999 to July 2000, and as Chief Financial Officer from October 1995 to October 1999

•  Degree in Mechanical and Electrical Engineering from the Instituto Tecnológico y de Estudios Superiores de Monterrey and an M.B.A. degree from Harvard Business School

 

  

Specific Qualifications, Experience, Attributes and Skills:

 

 

LOGO LOGO LOGO LOGO LOGO LOGO LOGO

 

•  Substantial payment systems, financial services and leadership experience from his tenure with Grupo Financiero BBVA Bancomer, for which he served in a variety of senior executive roles, including Chief Executive Officer of the Corporate Development Division, Executive Vice President of Strategic Planning, Deputy President of Systems and Operations, Chief Information Officer, Deputy President, President and Chief Financial Officer

•  Background and career in the payments and financial services industry in Mexico enable him to bring global perspectives to the board and to provide relevant insights regarding Visa’s strategies, operations and management. In addition, he chaired the BBVA Bancomer’s Assets and Liabilities Committee, Credit Committee and Operational Risk Committee, which enhanced his understanding of risk management of large, complex organizations

•  As the Chief Financial Officer of a large publicly-traded company, and through his board and committee membership with several large companies in Mexico, he has accumulated extensive experience in corporate finance and accounting, financial reporting and internal controls, human resources and compensation, which contributes to his service on our Compensation and Finance Committees

     

LOGO

Alfred F. Kelly, Jr.

 

Age: 62

 

Director Since:

January 2014

 

Board Committees:

None

 

Public Company Directorships:

 

(current) Visa Inc.

(prior) MetLife Inc.; Affinion Group Holdings, Inc.; Affinion Group, Inc.

 

Career Highlights:

 

•  Chief Executive Officer, Visa Inc. since December 2016 and Chairman since April 2019

•  Chief Executive Officer and President of Intersection, a digital technology and media company, from March 2016 to October 2016

•  Management Advisor, TowerBrook Capital Partners L.P. from April 2015 to February 2016

•  Chairman, President and Chief Executive Officer of the 2014 NY/NJ Super Bowl Host Company, the entity created to raise funds for and host Super Bowl XLVIII, from April 2011 to August 2014

•  Held senior positions at the American Express Company, a global financial services company, for 23 years, including serving as President from July 2007 to April 2010, Group President, Consumer, Small Business and Merchant Services from June 2005 to July 2007, and Group President, U.S. Consumer and Small Business Services from June 2000 to June 2005

•  Former head of information systems at the White House from 1985 to 1987

•  Held various positions in information systems and financial planning at PepsiCo Inc. from 1981 to 1985

•  B.A. degree in Computer and Information Science and an M.B.A. degree from Iona College

  

Specific Qualifications, Experience, Attributes and Skills:

 

 

LOGO LOGO LOGO LOGO LOGO LOGO LOGO LOGO LOGO LOGO

 

•  As the President of American Express, he was responsible for the company’s global consumer businesses, including consumer and small business cards, customer service, global banking, prepaid products, consumer travel and risk and information management

•  Significant tenure and experience as a senior executive of a global financial services and payment card company provide him with a thorough understanding of our business and industry

•  Has experience in information technology and data management, both areas relevant to our business, from his service as the head of information systems of the White House and his roles at PepsiCo

•  His previous service as a member of the Audit Committee of MetLife, and as Chair of the Audit Committees of Affinion Group Holdings, Inc. and its wholly-owned subsidiary, Affinion Group, Inc., enhanced his expertise in the areas of corporate finance, accounting, internal controls and procedures for financial reporting, risk management oversight and other audit committee functions

 

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LOGO

Ramon Laguarta

 

Age: 57

 

Independent

 

Director Since:

November 2019

 

Board Committees:

Audit and Risk Committee;

Nominating and Corporate Governance Committee

 

Public Company Directorships:

 

(current) PepsiCo, Inc.; Visa Inc.

(prior) none

 

Career Highlights:

 

•  Chief Executive Officer of PepsiCo, Inc. since October 2018 and Chairman of the Board since February 2019

•  Held several other senior positions at PepsiCo for over 20 years, including: President (2017-2018); Chief Executive Officer, Europe Sub-Saharan Africa (2015-2017); Chief Executive Officer, Europe (2015); President, Developing and Emerging Markets, PepsiCo Europe (2012-2015); President, Eastern Europe, PepsiCo Europe (2008-2012); Commercial Vice President, Snacks and Beverages, PepsiCo Europe (2006-2008); General Manager, Iberia Snacks and Juices (2003-2006); General Manager, Spain Snacks (2001-2003); General Manager, Greece and Cyprus (1999-2001); and Vice President, Business Development (1996-1999)

•  M.B.A. in international business from ESADE Business School in Spain and a Masters in international management from Thunderbird School of Global Management at Arizona State University

 

  

Specific Qualifications, Experience, Attributes and Skills:

 

LOGO LOGO LOGO LOGO

 

 

•  Strong leadership skills and extensive consumer packaged goods experience gained from the 20-plus years he spent in a variety of senior operational and executive roles at PepsiCo enables him to provide valuable market and consumer insights.

•  His numerous international senior management positions, including living in Europe and leading PepsiCo’s Europe Sub-Saharan Africa division, which has operations that span three continents and is composed of developed, developing and emerging markets, provides invaluable perspectives on the global marketplace and sustainability. He speaks multiple languages including English, Spanish, French, German and Greek.

•  His deep experience and strong understanding of the key strategic challenges and opportunities of running a large global business make him well-positioned to oversee strategic planning, operations, marketing, brand development and logistics.

     

LOGO

John F. Lundgren

 

Age: 69

 

Independent

 

Director Since:

April 2017

 

Board Committees:

Compensation Committee;

Nominating and Corporate Governance Committee

 

Public Company Directorships:

 

(current) Callaway Golf Company (Chairman); Visa Inc.

(prior) Stanley Black & Decker, Inc.; Staples, Inc.

 

Career Highlights:

 

•  Lead Independent Director of our Board since April 2019

•  Chief Executive Officer of Stanley Black & Decker, Inc. from March 2010 until his retirement in July 2016; also served as Chairman until December 2016

•  Chairman and Chief Executive Officer of The Stanley Works, a worldwide supplier of consumer products, industrial tools and security solutions for professional, industrial and consumer use, from March 2004 until its merger with Black & Decker in March 2010

•  President of European Consumer Products of Georgia-Pacific Corporation from January 2000 to February 2004

•  President of European Consumer Products of James River Corporation from 1995 to 1997 and Fort James Corporation from 1997 to 2000 until its acquisition by Georgia-Pacific

•  B.A. degree from Dartmouth College and an M.B.A. from Stanford University

  

Specific Qualifications, Experience, Attributes and Skills:

 

LOGO LOGO LOGO LOGO LOGO LOGO

 

•  Substantial executive leadership and brand experience having served over 12 years as Chief Executive Officer and Chairman of Stanley Black & Decker and The Stanley Works

•  Knowledge and experience with consumer market in Europe having served as President, European Consumer Products of Georgia Pacific Corporation, Fort James Corporation and James River Corporation for over 14 years

•  Currently serves as a member of the Audit Committee of Callaway Golf Company, providing him with experience in the areas of corporate finance, accounting, internal controls and procedures for financial reporting, risk management oversight and other audit committee functions

•  As a director of other public companies, he has experience with corporate governance, risk management, and business strategy and operations

 

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LOGO

Robert W. Matschullat

 

Age: 73

 

Independent

 

Director Since:

October 2007

 

Board Committees:

Compensation Committee;

Finance Committee

 

Public Company Directorships:

 

(current) Visa Inc.

(prior) The Clorox Company; The Walt Disney Company; McKesson Corporation; Morgan Stanley & Co. Incorporated; The Seagram Company Limited

 

Career Highlights:

 

•  Independent Chair of our Board from April 2013 to April 2019

•  Independent Lead Director (November 2012 to July 2015); interim Chairman and interim Chief Executive Officer (March 2006 to October 2006); Presiding Director (January 2005 to March 2006), and Chairman of the board (January 2004 to January 2005) of the Clorox Company, a global consumer products company

•  Vice Chairman of the board of directors and Chief Financial Officer of The Seagram Company Limited, a global company with entertainment and beverage operations, from 1995 until 2000

•  Head of worldwide investment banking at Morgan Stanley & Co. Incorporated, a securities and investment firm, from 1991 to 1995

•  Served on the board of directors of The Clorox Company from 2004 to 2020, The Walt Disney Company from 2002 to 2018, McKesson Corporation from 2002 to 2007, and Morgan Stanley from 1992 to 1995

•  B.A. degree in Sociology from Stanford University and an M.B.A. degree from the Stanford Graduate School of Business

 

 

  

Specific Qualifications, Experience, Attributes and Skills:

 

LOGO LOGO LOGO LOGO LOGO LOGO LOGO LOGO

 

•  Substantial executive leadership, financial services and risk management experience, having served as the head of worldwide investment banking and a director of Morgan Stanley, the Vice Chairman and Chief Financial Officer of Seagram, and the Chairman and interim Chief Executive Officer of Clorox

•  Was responsible for all finance, strategic planning, corporate communications, government, tax, accounting and internal auditing, mergers and acquisitions and risk management functions at Seagram

•  Served as the chair of the Audit Committee of Disney and Clorox, and as chair of the Finance Committee and a member of the Audit Committee of McKesson. These roles enhanced his expertise in the areas of corporate finance, accounting, internal controls and procedures for financial reporting, risk management oversight and other audit committee functions

•  Has experience managing complex, multinational operations from his tenure at Morgan Stanley, which operates in over 42 countries around the world, as well as Seagram and Clorox, whose products are sold in over 100 countries

 

     

LOGO

Denise M. Morrison

 

Age: 66

 

Independent

 

Director Since:

August 2018

 

Board Committees:

Audit and Risk Committee; Compensation Committee

 

Public Company Directorships:

 

(current) MetLife, Inc.; Quest Diagnostics; Visa Inc.

(prior) Campbell Soup Company

 

Career Highlights:

 

•  Founder of Denise Morrison & Associates, LLC, a consulting firm, since October 2018

•  President and Chief Executive Officer (August 2011 to May 2018), and a Board member (October 2010 to May 2018); Executive Vice President and COO (October 2010 to July 2011); Senior Vice President, President of North America Soup, Sauces and Beverages (October 2007 to September 2010); President, Campbell USA (June 2005 to September 2007); and President, Global Sales and Chief Customer Officer (April 2003 and May 2005) of Campbell Soup Company, a food and beverage company

•  Held senior positions at Kraft Foods, Inc., a food and beverage company, including Executive Vice President and General Manager, Snacks Division from 2001 to 2003; Executive Vice President and General Manager, Confections Division in 2001; Senior Vice President and General Manager, Nabisco Down the Street Division in 2000; Senior Vice President, Nabisco Sales and Integrated Logistics from 1998 to 2000; Vice President, Nabisco Foods Sales and Integrated Logistics from 1997 to 1998 and Area Vice President, West, Nabisco Sales and Integrated Logistics from 1995 to 1997

•  Held various senior marketing and sales positions at Nestle SA from 1984 to 1995

•  Held Business Development manager position at PepsiCo, Inc. from 1982 to 1984

•  Held various manager and sales positions at The Procter & Gamble Company from 1975 to 1982

•  B.S. degrees in Economics and Psychology from Boston College

 

  

Specific Qualifications, Experience, Attributes and Skills:

 

LOGO LOGO LOGO LOGO LOGO LOGO LOGO

 

•  Distinguished record of building strong businesses and growing iconic brands, having served over 15 years as Chief Executive Officer and other senior management roles at Campbell Soup Company, whose products are sold in over 120 countries around the world

•  Her extensive executive leadership experience 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, which contributes to her service on our Audit and Risk and Compensation Committees

•  Her prior experience in sales, marketing, operations and business development in leading consumer product companies add to her deep understanding of the consumer and retail market

•  Her board and committee service with public and private companies provide her with a strong understanding of the effective functioning of corporate governance structures

 

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LOGO

 

Suzanne Nora Johnson

 

Age: 63

 

Independent

 

Director Since:

October 2007

 

Board Committees:

Audit and Risk Committee;

Nominating and Corporate Governance Committee

 

Public Company Directorships:

 

(current) Intuit Inc.; Pfizer Inc.; Visa Inc.

(prior) American International Group, Inc.

 

Career Highlights:

 

•  Vice Chairman of the Goldman Sachs Group, Inc., a bank holding company and a global investment banking, securities and investment management firm, from November 2004 until her retirement in January 2007

•  Served in various leadership roles at Goldman Sachs, including Chair of the Global Markets Institute, head of the Global Investment Research Division and head of the Global Healthcare Business; founded the firm’s Latin American business

•  B.A. degree in Economics, Philosophy/Religion and Political Science from the University of Southern California and a J.D. degree from Harvard Law School

  

Specific Qualifications, Experience, Attributes and Skills:

 

LOGO LOGO LOGO LOGO LOGO LOGO LOGO LOGO

 

•  Extensive financial services, international and executive leadership experience from her 21-year tenure at Goldman Sachs. As Vice Chairman of the firm, as well as in her prior roles as Chair of the Global Markets Institute, head of the Global Investment Research Division and head of the firm’s Global Healthcare Business, she gained expertise in strategic and financial planning, risk oversight and multinational operations, which enables her to provide sound guidance and insight regarding Visa’s strategies and management

•  Significant financial experience from her work in investment banking and investment research, including a thorough understanding of financial statements, corporate finance, accounting and capital markets

•  Clerked for the United States Court of Appeals for the Fourth Circuit and practiced transactional and banking law at a pre-eminent national law firm, a background that provides her with insight into the laws and regulations that impact Visa

•  Her board and committee service for Intuit and Pfizer similarly contribute to her strong understanding of corporate governance and the best practices of effective publicly-traded company boards

 

     

LOGO

 

Linda J. Rendle

 

Age: 42

 

Independent

 

Director Since:

November 2020

 

Board Committees:

Finance Committee;

Nominating and

Corporate Governance Committee

 

Public Company Directorships:

 

(current) The Clorox Company; Visa Inc.

(prior) none

 

Career Highlights:

 

•  Chief Executive Officer of The Clorox Company since September 2020

•  Held several other senior positions at Clorox for nearly 20 years, including: President (May 2020-September 2020); EVP, Global Operations & Strategy, Cleaning and International (July 2019-May 2020); EVP, Global Operations & Strategy, International, Better Health (January 2019-July 2019); EVP and General Manager, Cleaning, Professional Products and Strategy (June 2018-January 2019); SVP and General Manager, Cleaning and Professional Products (April 2017-June 2018); SVP and General Manager, Cleaning (August 2016-April 2017); VP and General Manager, Home Care (October 2014-August 2016); VP, Sales, Cleaning (April 2012-October 2014); other positions of increasing responsibility, including VP, Sales, Directors of Sales Planning and Senior Sales Analyst (January 2003-April 2012)

•  Held several positions in sales management at Procter & Gamble from August 2000 to December 2002

•  Bachelor’s degree in Economics from Harvard University

  

Specific Qualifications, Experience, Attributes and Skills:

 

LOGO LOGO LOGO LOGO LOGO LOGO LOGO

 

•  Strong track record of outstanding business results and values-led leadership, gained from nearly 20 years spent in a variety of senior operational and executive roles across many of Clorox’s businesses, provide her with a diverse perspective on global sales, product innovation and business strategy.

•  As CEO of a global company, her extensive experience and instrumental role in developing key corporate strategies provide important insights and perspectives with respect to global product development, growth and long-range planning.

 

 

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LOGO

 

John A. C. Swainson

 

Age: 66

 

Independent

 

Director Since:

October 2007

 

Board Committees:

Audit and Risk Committee;

Nominating and Corporate Governance Committee

 

Public Company Directorships:

 

(current) Schneider National, Inc.; Visa Inc.

(prior) Assurant Inc.; Broadcom Corporation, CA, Inc.; Cadence Design Systems Inc.

 

Career Highlights:

 

•  Executive Partner, Siris Capital Group, a private equity firm, since November 2017

•  President of the Software Group of Dell Inc., a global computer manufacturer and information technology solutions provider, from February 2012 to November 2016

•  Senior Advisor to Silver Lake Partners, a global private investment firm, from June 2010 to February 2012

•  Chief Executive Officer of CA, Inc. (now CA Technologies), an information technology management software company, from February 2005 to December 2009 and was President and a director of CA, Inc. from November 2004 to December 2009

•  Vice President of Worldwide Sales for the Software Group of International Business Machines Corporation (IBM), a globally integrated technology company, from July 2004 to November 2004

•  General Manager of the Application Integration Middleware division of IBM from 1997 to 2004

•  Bachelor of Applied Science degree in Engineering from the University of British Columbia

  

Specific Qualifications, Experience, Attributes and Skills:

 

LOGO LOGO LOGO LOGO LOGO LOGO LOGO

 

 

•  Significant experience in the information technology industry, as well as in executive management, international operations, strategy, sales and marketing, from his tenure at Dell, CA Inc., and IBM

•  Responsible for leading Dell’s worldwide software businesses as the President of the Software Group, including software delivered as part of Dell’s hardware and services operations.

•  Oversaw the strategic direction and day-to-day operations as the Chief Executive Officer and director of CA, Inc., which is a multinational enterprise software business serving clients around the globe

•  Spent 26 years as a senior executive at IBM, including as Vice President of Worldwide Software Sales, where he oversaw sales for all IBM software products globally

•  Served as the General Manager of the Application Integration and Middleware Division, IBM’s largest software division, where he and his team developed, marketed and launched highly successful middleware products

•  Member of IBM’s Worldwide Management Council, strategy team and senior leadership team

•  Extensive executive experience from his roles at Dell, CA Inc., and IBM enables him to provide valuable insight into Visa’s product and growth strategies and other key aspects of the Company’s day-to-day business and management

•  Prior board and committee service for Cadence Design Systems Inc., Assurant Inc. and Broadcom Corporation broadened his exposure to new technologies, and provided him with expertise in the corporate governance of U.S. publicly-traded companies, which is relevant to his service on our Nominating and Corporate Governance Committee and Audit and Risk Committee

 

     

LOGO

 

Maynard G. Webb, Jr.

 

Age: 65

 

Independent

 

Director Since:

January 2014

 

Board Committees:

Compensation Committee;

Finance Committee

 

Public Company Directorships:

 

(current) Salesforce.com. Inc.; Visa Inc.

(prior) Extensity, Inc.; Gartner, Inc.; Hyperion Solutions Corporation; LiveOps, Inc.; Niku Corporation; Yahoo! Inc.

 

Career Highlights:

 

•  Founder of Webb Investment Network, an early stage investment firm, and a co-founder of Everwise Corporation, a provider of workplace mentoring solutions

•  Chairman of the Board of LiveOps Inc., a cloud-based call center, from 2008 to 2013 and was its Chief Executive Officer from December 2006 to July 2011

•  Chief Operating Officer of eBay, Inc., a global commerce and payments provider, from June 2002 to August 2006, and President of eBay Technologies from August 1999 to June 2002

•  Senior Vice President and Chief Information Officer at Gateway, Inc., a computer manufacturer, from July 1998 to August 1999

•  Vice President and Chief Information Officer at Bay Networks, Inc., a computer networking products manufacturer, from February 1995 to July 1998

•  Bachelor of Applied Arts degree from Florida Atlantic University

  

Specific Qualifications, Experience, Attributes and Skills:

 

LOGO LOGO LOGO LOGO LOGO LOGO LOGO LOGO

 

 

•  Significant experience in developing, managing and leading high-growth technology companies, both from his roles as an investor and as a senior executive of LiveOps and eBay

•  Substantial leadership and operational experience, having served as the Chief Executive Officer of LiveOps, Chief Operating Officer of eBay, Inc., President of eBay Technologies, and as Chief Information Officer of Gateway and Bay Networks

•  His experience and expertise in engineering and information technology, as well as his prior and current service on the boards of several large, publicly-traded technology companies, enable him to contribute to the board’s understanding and oversight of Visa’s management, operations, systems and strategies

 

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BENEFICIAL OWNERSHIP OF EQUITY SECURITIES

Except where otherwise indicated, we believe that the stockholders named in the tables below have sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them. The following tables are based on [x,xxx,xxx,xxx] shares of Class A common stock outstanding as of November 27, 2020.

Directors and Executive Officers

The following table sets forth information known to the Company as of December 1, 2020 with respect to beneficial ownership of our Class A common stock by:

 

   

each member of the Board;

 

   

our named executive officers for fiscal year 2020; and

 

   

all current executive officers and directors of Visa as a group.

None of the directors, named executive officers, individually, or directors and current executive officers as a group, beneficially owned more than 1% of the total number of shares of our Class A common stock outstanding as of December 1, 2020.

 

Name of Beneficial Owner    Class A
common stock
 

Shares Issuable

Pursuant to Options
Exercisable within 60 days

of December 1, 2020

      Total    

Directors and Named Executive Officers:

            

 

            

Rajat Taneja

    

 

[x]

   

 

[x]

   

 

[x]

 

Ryan McInerney

    

 

[x]

   

 

[x]

   

 

[x]

 

Alfred F. Kelly, Jr.

    

 

[x]

   

 

[x]

   

 

   [x](1)

 

Vasant M. Prabhu

    

 

[x]

   

 

[x]

   

 

[x]

 

Paul Fabara

    

 

[x]

   

 

[x]

   

 

[x]

 

Suzanne Nora Johnson

    

 

[x]

   

 

[x]

   

 

[x]

 

John A. C. Swainson

    

 

[x]

   

 

[x]

   

 

[x]

 

Robert W. Matschullat

    

 

[x]

   

 

[x]

   

 

   [x](1)

 

Francisco Javier Fernández-Carbajal

    

 

[x]

   

 

[x]

   

 

[x]

 

Mary B. Cranston

    

 

[x]

   

 

[x]

   

 

   [x](1)

 

Lloyd A. Carney

    

 

[x]

   

 

[x]

   

 

[x]

 

John F. Lundgren

    

 

[x]

   

 

[x]

   

 

[x]

 

Denise M. Morrison

    

 

[x]

   

 

[x]

   

 

[x]

 

Maynard G. Webb, Jr.

    

 

[x]

   

 

[x]

   

 

   [x](1)

 

Ramon Laguarta

    

 

[x]

   

 

[x]

   

 

[x]

 

Linda J. Rendle

    

 

[x]

   

 

[x]

   

 

[x]

 

All Directors and Executive Officers as a Group (18 persons)

    

 

[x]

   

 

[x]

   

 

[x]

 

 

(1)

Total does not include the following number of shares deferred by each of our directors, as to which no voting or investment power currently exists: Kelly (4,550), Matschullat (2,880), Cranston (11,641) and Webb (10,160).

 

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Principal Stockholders

The following table shows those persons known to the Company to be the beneficial owners of more than 5% of the Company’s Class A common stock based on the information disclosed in the SEC filings identified below and the number of the Company’s Class A common stock outstanding as of November 27, 2020. In furnishing the information below, the Company has relied on information filed with the SEC by the beneficial owners.

 

Name and Address of

Beneficial Owner

  

  Date of Schedule 13G/A  

Filing

  

Amount and Nature of

Beneficial Ownership(1)

 

  Percent of Class  

(%)

The Vanguard Group
100 Vanguard Blvd.
Malvern, PA 19355

   February 12, 2020    147,937,455   [x]

BlackRock Inc.
55 East 52nd Street
New York, NY 10055

   February 6, 2020    125,231,790   [x]

FMR LLC
245 Summer Street
Boston, MA 02210

 

   February 7, 2020    88,341,075   [x]

 

(1)

Beneficial Owner    Sole Power to
Vote
   Shared Power
to Vote
   Sole Power to
Dispose
 

  Shared Power  

to Dispose

Vanguard

    

 

2,656,326

    

 

498,552

    

 

144,939,913

   

 

2,997,542

BlackRock

    

 

107,209,497

    

 

0

    

 

125,231,790

   

 

0

FMR

    

 

13,216,229

    

 

0

    

 

88,341,075

   

 

0

 

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EXECUTIVE OFFICERS

Biographical data for each of our current executive officers is set forth below, excluding Mr. Kelly’s biography, which is included under the heading Director Nominee Biographies above. Of our seven executive officers, 43% are diverse by race or ethnicity (Messrs. Fabara, Prabhu and Taneja) and 29% are women (Mses. Biggar and Mahon Tullier).

 

 

LOGO

Lynne Biggar

 

Executive Vice

President and Chief

Marketing and

Communications Officer

 

Age: 58

 

 

 

•  Joined Visa in February 2016

•  Leads all global efforts driving Visa’s global brand and surrounding marketing and client/consumer engagement efforts, including brand positioning, sponsorship management and activation, media and channel strategies, data and insights development, and internal and external communications

•  Former Executive Vice President – Consumer Marketing and Revenue for Time Inc., one of the largest branded media companies, from November 2013 to January 2016, where she was responsible for driving consumer revenue for Time Inc. brands and products across all channels, consumer insights, data solutions and customer service.

•  Held many senior positions at American Express Company, a multinational financial services corporation, from 1992 to 2013, most recently as Executive Vice President & General Manager – International Card Products and Experiences from January 2012 to November 2013, and Executive Vice President & General Manager – US Membership Rewards and Strategic Card Services in 2011

•  Member of the Board of Directors of Voya Financial, Inc.

•  Received her B.A. in international relations from Stanford University and an M.B.A. from Columbia University

 

 

LOGO

Paul Fabara

 

Executive Vice

President and Chief

Risk Officer

 

Age: 55

 

 

 

•  Joined Visa in September 2019

•  Responsible for maintaining the integrity and security of the Visa payment system, while also serving as the principal liaison with regulatory agencies

•  Ensures that Visa continues to deliver industry-leading services to prevent, detect and mitigate the impact of fraud and security attacks on Visa’s clients and other payment system stakeholders

•  Held many senior positions at American Express Company, a multinational financial services corporation, from 2011 to 2019, most recently as President, Global Services Group from February 2018 to September 2019, where he was responsible for the company’s global servicing functions, including customer service, credit and fraud operations, as well as enterprise-wide strategic initiatives; and Chief Risk Officer and President, Global Risk, Banking & Compliance, where he promoted strong capabilities and disciplined, integrated risk controls, from February 2016 to February 2018

•  Held senior positions at Barclays, a multinational investment bank and financial services company, including Managing Director, Global Head of Operations, Regulatory Implementation and Planning from February 2009 to January 2011, and Global Chief Operating Officer, Barclaycard from August 2006 to February 2009

•  Former Chief Operating Officer, Card Services at Alliance Data Systems, provider of loyalty and marketing services, from June 2002 to August 2006

•  Started his career at Providian Financial Corporation, where he served in many capacities including risk management, underwriting, marketing, sales and service and credit administration

 

LOGO

Ryan McInerney

 

President

 

Age: 45

 

 

•  Joined Visa in May 2013

•  Responsible for delivering value to Visa’s financial institutions, acquirers, merchants and strategic partners in more than 200 countries and territories around the world

•  Oversees Visa’s market leadership teams, client services, innovation and strategic partnerships, and global product solutions

•  Served as Chief Executive Officer of Consumer Banking for JPMorgan Chase, a global financial services firm, from June 2010 to May 2013, where he oversaw a business with more than 75,000 employees and revenues of approximately $14 billion; was responsible for a banking network serving 20 million customers in 23 states

•  Served as Chief Operating Officer for Home Lending and as Chief Risk Officer for Chase’s consumer businesses, overseeing all credit risk management in credit card, home lending, auto finance, education finance, consumer banking and business banking; also served as Chase’s head of Product and Marketing for Consumer Banking

•  Former Principal at McKinsey & Company in the firm’s retail banking and payments practices

•  Received a finance degree from the University of Notre Dame

 

 

 

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LOGO

Vasant M. Prabhu

 

Vice Chairman and

Chief Financial Officer

 

Age: 60

 

 

•  Joined Visa in February 2015

•  Responsible for the Company’s financial strategies, planning and reporting, in addition to all finance operations and investor relations

•  Served as Chief Financial Officer for NBCUniversal, a multinational media conglomerate, from May 2014 to February 2015, where he oversaw the company’s financial planning and operations and played a key role in NBCUniversal’s strategic business initiatives. Also managed the Operations and Technical Services division, which included NBCUniversal’s technical operations, physical plant, corporate services and information technology functions

•  Served as Chief Financial Officer for Starwood Hotels & Resorts Worldwide, Inc., a hotel company that is now part of Marriott International, from 2004 to May 2014

•  Former Executive Vice President, Chief Financial Officer and President, E-Commerce for Safeway, Inc., the $35 billion supermarket retailer

•  Gained experience in the media sector as President of the Information and Media Group, The McGraw-Hill Companies, where he led a $1 billion division comprising Business Week, Broadcast television stations and Business Information Services

•  Held senior positions at PepsiCo, including Senior Vice President of Finance & Chief Financial Officer, Pepsi-Cola International

•  Started his career at Booz, Allen & Hamilton, the management consulting firm, where he rose to become a Partner serving Media and Consumer companies

•  Received his M.B.A. from the University of Chicago and a B.S. in Engineering from the Indian Institute of Technology

 

 

LOGO

Rajat Taneja

 

President, Technology

 

Age: 56

 

 

 

•  Joined Visa in November 2013

•  Responsible for the Company’s technology innovation and investment strategy, product engineering, global IT and operations infrastructure

•  Served as Executive Vice President and Chief Technology Officer of Electronic Arts Inc., a video game company, from October 2011 to November 2013, where he was responsible for platform engineering, data center operations and IT supporting the company’s global customer base

•  Worked at Microsoft Corporation, including most recently as the Corporate Vice President, Commerce Division, in 2011 and the General Manager and Corporate Vice President, Online Services Division, from 2007 to 2011

•  Holds a B.E. in Electrical Engineering from Jadavpur University and an M.B.A. from Washington State University

 

 

LOGO

Kelly Mahon Tullier

 

Executive Vice

President, General

Counsel and Corporate

Secretary

 

Age: 54

 

 

 

•  Joined Visa in June 2014

•  Leads the global legal and compliance functions for Visa

•  Served as Senior Vice President and Deputy General Counsel at PepsiCo, Inc., a multinational food, snack and beverage corporation, from August 2011 to June 2014, and managed the global legal teams supporting the business around the world, as well as centralized teams responsible for mergers and acquisitions, intellectual property, regulatory, litigation and procurement legal matters; also served as Senior Vice President and General Counsel for PepsiCo’s Asia Pacific, Middle East and Africa division, based in Dubai

•  Former Vice President and General Counsel for Frito-Lay, Inc., with responsibility for a wide range of legal, policy and compliance issues

•  Former associate at Baker Botts LLP and also served as a law clerk for the Honorable Sidney A. Fitzwater, U.S. District Court, Northern District of Texas

•  Received her B.A. from Louisiana State University and her J.D., magna cum laude, from Cornell Law School

 

 

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COMPENSATION DISCUSSION AND ANALYSIS

Executive Summary

This Compensation Discussion and Analysis describes our executive compensation philosophy and programs, and compensation decisions made under those programs for our named executive officers, or NEOs, for fiscal year 2020. Our NEOs are listed below.

 

Name

    

Title

Alfred F. Kelly, Jr.

    

Chairman and Chief Executive Officer

Vasant M. Prabhu

    

Vice Chairman and Chief Financial Officer

Ryan McInerney

    

President

Rajat Taneja

    

President, Technology

Paul Fabara

    

Executive Vice President and Chief Risk Officer

Philosophy of our Compensation Program

We maintain compensation plans that tie a substantial portion of our NEOs’ overall target annual compensation to the achievement of corporate and individual performance goals. The Compensation Committee employs multiple performance measures and strives to award an appropriate mix of annual and long-term equity incentives to avoid overweighting short-term objectives. Annual goals promote and incorporate ESG factors that are relevant to the Company’s strategic objectives or to each NEO’s individual scope of responsibility.

 

Principles of our Compensation Program

 

Pay for Performance

 

  

 

The key principle of our compensation philosophy is pay for performance.

 

 

Alignment with

Stockholders’ Interests

 

  

 

We reward performance that meets or exceeds the performance goals that the Compensation Committee establishes with the objective of increasing stockholder value.

 

 

Variation Based on Performance

 

  

 

We favor variable pay opportunities that are based on performance over fixed pay. The total compensation received by our NEOs varies based on corporate and individual performance measured against annual and long-term goals.

 

 

Motivate and Retain Key Talent

  

We design our compensation program to motivate and retain key talent. This item has been added to the “Principles of Our Compensation Program” this year to reflect the Compensation Committee’s existing commitment to this principle.

 

 

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Key Elements of our Fiscal Year 2020 Compensation Program

 

 

LOGO

 

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Components of Executive Compensation

 

  Compensation

  Component

     

    Type of Pay         

 

     

Key Characteristics

 

     

Purpose

 

   
               
 

 

Annual Cash Compensation

             

    

  Base Salary   Fixed     Reviewed annually based on individual performance, market pay levels and internal pay equity.   Attracts, retains and rewards NEOs by providing a fixed source of income to reward experience, skills and competencies.  
           
 

 

Annual Incentive Awards

             

    

  Cash Incentive Awards  

Performance-

Based

    Variable cash compensation component based on performance against pre-established individual and corporate performance goals, including key operating financial goals and other strategic goals that drive long-term stockholder value. A number of individual goals promote and incorporate ESG factors.   Focuses NEOs on our results and aligns NEOs’ interests with stockholders’ interests by rewarding corporate and individual performance and achievement of strategic goals.  
           
 

 

Long-term Incentive Awards

             

    

  Equity Granted in the Form of Stock Options, Restricted Stock Units and Performance Shares  

Performance-

Based

    Stock option and restricted stock unit awards vest annually over a three-year period. Performance shares vest at the end of a three-year performance period.  

Aligns NEOs’ interests with long-term stockholders’ interests by linking a substantial portion of each NEO’s compensation to long-term corporate performance and operational efficiency.

Retains NEOs through multi-year vesting of equity awards and three-year performance periods, as applicable.

Provides opportunities for stock ownership, which attracts and motivates our NEOs and promotes retention.

 
                     
           

 

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Fiscal Year 2020 Overview

Fiscal year 2020 brought unique challenges to Visa, our employees, clients and the communities in which we live and operate. Following the start of the COVID-19 global pandemic, Visa’s executive officers mobilized quickly to ensure that our employees were safe, secure, engaged and productive. To support our employees during this time, we expanded remote work, established specialized engagement and feedback initiatives, broadened benefit offerings, and in April 2020 committed that there would be no employee layoffs in calendar year 2020 related to COVID-19. Our Chairman and Chief Executive Officer has provided video updates to all employees every week since the onset of COVID-19, our regional leaders host weekly town hall meetings, and we offered additional Employee Assistance Program counseling sessions and conducted global Employee Pulse Surveys to understand and respond to employee needs.

Visa made and fulfilled significant commitments to social and environmental causes in fiscal year 2020. This included establishing a goal to increase our underrepresented population at the Vice President and above level in the U.S. by 50% over three years and our overall underrepresented employee population in the U.S. by 50% over five years, a $10 million investment in the Visa Black Scholars & Jobs program, double matching of employee donations to racial justice charities, and a global commitment to elevate 50 million small and micro businesses worldwide in an effort to get local communities back to business in the wake of COVID-19. We also met our commitment to use 100% renewable energy by calendar year 2020 through energy sources such as solar and wind and issued our inaugural $500 million green bond to finance projects in green buildings, renewable energy, and energy and water efficient operations.

Despite the extraordinary challenges posed by COVID-19 on the global economy and our business, there were many trends that accelerated the demand for global payments, new flows, and value added services, which help our business and align with our long-term strategy. Many small and medium-sized businesses expanded their ecommerce presence, and consumers are increasingly becoming more comfortable making online purchases. In face to face transactions, consumers and merchants are recognizing that contactless payments are safe, easy and secure, offering a touch-free option at checkout in addition to speed and convenience. Governments around the world have worked with Visa to efficiently provide stimulus and unemployment benefits to their constituents using Visa Direct or prepaid cards.

COVID-19 Considerations

During fiscal year 2020, the Compensation Committee considered the impact of COVID-19 on our executive compensation program by reference to the principles of the program, including pay for performance, alignment with stockholders’ interests, and motivation and retention of key talent, which includes maintaining a program that is a fair reflection of corporate and individual performance.

In light of these considerations and the unique and unforeseen challenges posed by COVID-19, the Compensation Committee considered the appropriate allocation between corporate and individual performance in the annual incentive plan design for fiscal year 2020. Following the start of the global pandemic, our NEOs were necessarily focused on individual operational goals and on leading Visa and our employees through the significant impact of COVID-19. These updated priorities, including keeping employees safe, engaged, and motivated; securing the integrity of our network; delivering high quality client service and support; advancing ESG initiatives; maintaining liquidity; and continuing to pursue Visa’s long-term strategy, drove the NEOs’ actions in the second half of the fiscal year and would define their success during this period. As a result, in consultation with FW Cook, in August 2020 the Compensation Committee placed more emphasis on individual performance in the annual incentive plan for fiscal year 2020 by increasing the weighting of the individual performance component to 50% for all of our NEOs, from last year’s weighting of 20% for our Chairman and Chief Executive Officer and 30% for the other NEOs. The individual performance goals for our NEOs were also updated in April 2020 to reflect changing business priorities and the extraordinary circumstances caused by COVID-19, and to ensure that our NEOs remain focused on the well-being of our employees, clients, and the communities in which we operate. Additional

 

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information regarding individual performance goals is available under the heading Fiscal Year 2020 Compensation – Individual Performance Goals and Results for Fiscal Year 2020.

The Compensation Committee did not modify the corporate performance goals that were established at the beginning of the fiscal year, prior to the onset of COVID-19, for the annual cash incentive plan or outstanding performance share awards. As a result, the portion of the annual cash incentive plan that relates to fiscal year 2020 Net Income Growth and Net Revenue Growth resulted in no annual incentive payment to our NEOs. Similarly, one-third of each outstanding performance share award held by our NEOs resulted in a fiscal year 2020 Earnings Per Share (“EPS”) performance factor of 0%.

How Fiscal Year 2020 Named Executive Officer Compensation Is Tied to Performance

Corporate and individual performance were key factors in our fiscal year 2020 NEO compensation program:

Link to Performance

 

   

For fiscal year 2020, 93% of our Chairman and Chief Executive Officer’s total direct compensation was performance-based and 90% of the average of our other NEOs’ total direct compensation was performance-based. Our Compensation Committee chose Net Income Growth, Net Revenue Growth, Earnings Per Share and relative Total Shareholder Return (“TSR”) as key financial metrics that drive stockholder value, which we use as the basis to compensate our NEOs for corporate performance.

 

   

Individual performance is an important part of our executive compensation program. Our annual incentive program includes an individual performance component that rewards our NEOs for the achievement of strategic goals that are designed to position the Company competitively, and that promote and incorporate ESG principles. As described under the heading Fiscal Year 2020 Overview, to reflect new priorities caused by the global pandemic, the Compensation Committee placed increased emphasis on individual performance in fiscal year 2020 by adjusting the weighting of the individual component to 50% from the initial weighting of 20% for our Chairman and Chief Executive Officer and 30% for the other NEOs. The individual performance goals for our NEOs were also updated in April 2020 to reflect changing business priorities and the extraordinary circumstances caused by COVID-19, and to ensure that our NEOs focused on the well-being of our employees, clients, and the communities in which we operate. The Compensation Committee also considers individual performance when it determines the values of long-term equity grants.

Utilize Annual and Long-Term Awards

 

   

Each NEO’s performance-based compensation includes an annual cash incentive award and long-term performance shares. For the annual cash incentive, the target award is established at the beginning of the fiscal year and the actual award is determined based on performance against pre-established goals. Performance shares provide the opportunity for shares to be earned at the end of a three-year performance period if pre-established financial goals are met. We also grant time-based stock options and restricted stock units, which provide value based on the Company’s stock price performance.

Individual and Corporate Performance Results

 

   

The corporate metrics approved for the fiscal year 2020 annual incentive plan were Net Income Growth and Net Revenue Growth. In this proxy statement, we refer to these metrics as Net Income Growth – VIP adjusted and Net Revenue Growth – VIP adjusted. Although the Company’s financial performance in the first half of the fiscal year was on track to result in a payment under the annual incentive plan, final performance for each metric fell below the baseline established by the Compensation Committee at the beginning of the fiscal year. Accordingly, the NEOs received no payment under the annual incentive plan for the portion of the plan related to corporate performance in fiscal year 2020.

 

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Our NEOs demonstrated exceptional leadership during the fiscal year, and in consultation with FW Cook, the Compensation Committee determined that the portion of the annual incentive attributable to achievement of individual performance goals should pay out at 160% of the target individual performance component percentage established by the Compensation Committee for each NEO. The Compensation Committee reached this conclusion after careful consideration of the NEOs’ performance against pre-established goals that were designed to align with our strategic objectives, including key ESG initiatives, as described under the heading Individual Performance Goals and Results for Fiscal Year 2020. As described in more detail below under the heading Annual Incentive Plan, because each NEO received no payment for the portion of the annual incentive plan related to corporate performance, each NEO received a total fiscal year 2020 annual incentive payout below his target payout percentage.

 

   

The performance shares granted to our NEOs are based on our average EPS result over the three separate years applicable to the particular performance share award and our relative TSR for the three-year period. In this proxy statement, we refer to this metric as EPS – PS adjusted. Our fiscal year 2020 EPS – PS adjusted fell below the minimum established for fiscal year 2020, resulting in a performance factor of 0% for the relevant portion of each award. This performance factor negatively affected the number of performance shares that vested in November 2020, and it will continue to affect the number of performance shares that are scheduled to vest in the following two years.

 

   

The performance shares previously awarded on November 19, 2017 completed their three-year performance period following the 2020 fiscal year-end. Performance shares earned pursuant to these awards were based on EPS – PS adjusted for fiscal years 2018, 2019 and 2020 and our three-year relative TSR (measured against the S&P 500). As described under the heading Compensation Discussion and Analysis – Determination of Shares Earned for Performance Shares Previously Awarded on November 19, 2017, performance against the two metrics resulted in the vesting of 127.7% of the target number of performance shares subject to these awards.

 

   

The adjustments made to the financial metrics used in our annual incentive plan and performance shares were pre-approved at the beginning of the respective performance periods, consistent with the terms of the applicable plans and as further described below in this Compensation Discussion & Analysis.

 

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Highlights of our Compensation Program

 

  WHAT WE DO

   LOGO

  

 

Pay for Performance: A significant portion of each NEO’s target annual compensation is tied to corporate and individual performance.

 

   LOGO

  

 

Annual Say-on-Pay Vote: We conduct an annual Say-on-Pay advisory vote. At our 2020 Annual Meeting of Stockholders, approximately 95% of the votes cast on the Say-on-Pay proposal were in favor of the fiscal year compensation of our NEOs.

 

   LOGO

  

 

Recoupment Policies: Our Clawback Policy authorizes the Board to recapture past incentive compensation or cancel outstanding awards in the event of a material restatement of the Company’s financial results due to fraud, intentional misconduct or gross negligence of the executive officer, and our equity award agreements provide for the forfeiture of equity-based awards in the event of specified detrimental activity in the absence of a restatement.

 

   LOGO

  

 

Short-Term and Long-Term Incentives/Measures: Our annual and long-term plans provide a balance of incentives and include complementary measures of performance.

 

   LOGO

  

 

Capped Incentive Award: Payouts under our annual incentive and long-term performance shares are capped at 200% of target.

 

   LOGO

  

 

Independent Compensation Consultant: The Compensation Committee engages an independent compensation consultant, who provides no other services to the Company.

 

   LOGO

  

 

Stock Ownership Guidelines: To further align the interests of management with our stockholders, we have significant stock ownership guidelines that require our executive officers to hold a multiple of their annual base salary in equity.

 

   LOGO

  

 

Limited Perquisites: We provide limited special benefits to executive officers and no tax gross-ups except on business-related relocation expenses and tax equalization for employees on expatriate assignments, as provided in our relocation and tax equalization policies, and in limited circumstances related to the reimbursement of certain expenses incurred in connection with the hiring process.

 

   LOGO

  

 

Engagement with Stockholders: Our Board and management team greatly value the opinions and feedback of our stockholders, which is why we have proactive, ongoing engagement with our stockholders throughout the year focused on executive compensation.

 

 

  WHAT WE DON’T DO

 

 

   LOGO

  

 

Gross-up for Excise Taxes: Our Executive Severance Plan does not contain a gross-up for excise taxes that may be imposed as a result of severance or other payments deemed to be made in connection with a change of control. Similarly, we generally do not provide for tax gross-ups on our limited perquisites.

 

 

   LOGO

  

 

Repricing of Stock Options: Our equity incentive plan prohibits the repricing of stock options and stock appreciation rights without prior stockholder approval.

 

 

   LOGO

  

 

Fixed-Term Employment Agreements: Employment of our executive officers is “at will” and may be terminated by either the Company or the employee at any time.

 

   LOGO

  

 

Single-Trigger Severance Arrangements: Our Executive Severance Plan and equity award agreements generally require a qualifying termination of employment in addition to a change of control before any change of control payments or benefits are triggered.

 

 

   LOGO

  

 

Hedging and Pledging: Our insider trading policy prohibits all employees and directors from hedging their economic interest in the Visa shares they hold or pledging Visa shares as collateral for a loan.

 

 

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How our Incentive Program is Tied to our Long-Term Strategy

Visa’s mission is to connect the world through the most innovative, reliable and secure digital payment network — enabling individuals, businesses and economies to thrive. Two of Visa’s strategies include accelerating growth by broadening our revenue streams in consumer payments, new flows and value added services as we expand the network into the Network of Networks, and fortifying our foundation by building upon Visa’s strong brand, leading technology, fortress security and exemplary talent. These objectives are designed to position the Company competitively and thereby deliver superior operational and financial performance, which will in turn create value for our stockholders and benefit our employees, clients and communities.

 

 

LOGO

 

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As illustrated below, we tie our executive compensation program to our long-term business strategy by rewarding our executive officers for the achievement of goals and fulfillment of activities that support the strategy. A number of these individual goals promote and incorporate ESG factors. In addition, achieving our strategic objectives helps drive the long-term corporate performance metrics used in our executive compensation program.

 

 

LOGO

 

       

Annual Incentive Plan: Individual and Corporate Performance

 

 

     

  Corporate performance goals are a key component of our annual incentive plan

 

  A significant portion of our executive officers’ individual performance goals is tied to one or more of our strategic objectives (as explained further in this proxy statement under Individual Performance Goals and Results for Fiscal Year 2020)

 

  The executive officers’ individual performance goals also include relevant ESG factors such as:

 

 Inclusion and diversity

 

 Employee leadership and development

 

 Employee health, safety, productivity, and engagement

 

 Cybersecurity and data privacy

 

 Financial inclusion and access

 

 Corporate governance

 

 

         

Aligns executive officers’ interests with stockholders’ interests by:

 

  rewarding individual performance for achievement of strategic goals (designed to position the Company competitively)

 

  promoting strong financial results

 

 

 

       
Long-Term Equity Grants: Individual and Corporate Performance        

  We link a substantial portion of compensation to long-term corporate performance through the use of long-term incentives, including performance shares that use EPS and relative TSR as financial metrics

 

  We consider individual performance (which is tied to our strategic objectives, including relevant ESG factors) in setting the value of our executive officers’ long-term equity grant

 

 

         

Further aligns executive officers’ interests with long-term stockholders’ interests by:

 

  taking individual performance (which is tied to our strategic objectives) into account in making equity grants

 

  linking a substantial portion of long-term compensation to long-term corporate performance and operational efficiency

 

 

 

Say-on-Pay

At the 2020 Annual Meeting of Stockholders, approximately 95% of the votes cast on the Company’s annual Say-on-Pay proposal supported our NEO compensation program. We believe these results represent strong investor support of our overall compensation philosophy and decisions for fiscal year 2019. Accordingly, the Compensation Committee did not make any changes to the underlying structure of our executive compensation program for fiscal year 2020 directly as a result of the Say-on-Pay vote. Nevertheless, the Compensation Committee regularly reviews the compensation program to ensure it remains competitive and aligned with our stockholders’ interests and the principles of the program.

 

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Setting Executive Compensation

Compensation Committee and Management

Our Compensation Committee, which consists solely of independent directors, is responsible for establishing and reviewing the overall compensation philosophy and program for our NEOs.

As discussed in detail under the heading Risk Assessment of Compensation Programs, when establishing the annual compensation program for our NEOs, the Compensation Committee takes into consideration the potential risks associated with the program and structures it to provide appropriate incentives without encouraging excessive risk taking.

 

 

Setting Performance Goals and Making Compensation Determinations

 

LOGO

 

   Compensation Committee begins with a review of our compensation program, including determining if our compensation levels are competitive with our peer companies and if any changes should be made to the program for the next fiscal year.

 

   Compensation Committee determines the principal components of compensation for the NEOs and the individual performance goals of the Chairman and Chief Executive Officer and sets the performance goals for each corporate performance-based compensation component.

 

   Chairman and Chief Executive Officer sets individual performance goals for each of the other NEOs, which are reviewed by the Compensation Committee. The individual performance goals are designed to drive our corporate goals and strategic objectives.

   

   Compensation Committee meets regularly throughout the year, with management and in executive session, and reviews the Company’s performance to date against the corporate performance goals. The Compensation Committee also reviews the executive compensation program to ensure that it remains competitive and aligned with our stockholders’ interests and the other principles of the program.

    

   Compensation Committee conducts a multi-part review of each NEO and the Company’s performance for the preceding fiscal year measured against the pre-established performance goals and makes annual compensation determinations. The Compensation Committee’s objective is to ensure that the level of compensation approved is consistent with the level of corporate and individual performance delivered.

 

   Our Chairman and Chief Executive Officer reviews the performance of each NEO (other than his own performance, which is reviewed by the Compensation Committee) relative to the individual performance goals established for the fiscal year and presents his compensation recommendations to the Compensation Committee.

 

   Compensation Committee exercises discretion in modifying any compensation recommendations relating to NEOs that were made by our Chairman and Chief Executive Officer and approves all compensation decisions for our NEOs.

 

   For his own performance review, the Chairman and Chief Executive Officer prepares a self-assessment, which is reviewed by each independent director and discussed by the Compensation Committee and the other independent directors of the Board. When making compensation decisions for our Chairman and Chief Executive Officer and other NEOs, the Compensation Committee considers the views of the other independent directors.

 

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Role of Independent Consultant

Our Compensation Committee has the sole authority to retain and replace compensation consultants to provide it with independent advice. The Compensation Committee has engaged FW Cook as its independent consultant to advise it on executive and non-employee director compensation matters. This selection was made without the input or influence of management. Under the terms of its agreement with the Compensation Committee, FW Cook will not provide any other services to the Company, unless directed to do so by the Compensation Committee and within the scope of the Compensation Committee’s charter. During fiscal year 2020, FW Cook provided no services to the Company other than to advise the Compensation Committee on executive and non-employee director compensation issues. In addition, at the start of fiscal year 2020, the Compensation Committee conducted a formal evaluation of the independence of FW Cook and, based on this review, did not identify any conflict of interest raised by the work performed by FW Cook. When conducting this evaluation, the Compensation Committee took into consideration the factors set forth in Exchange Act Rule 10C-1 and the NYSE’s listing standards.

Compensation Peer Group

As part of its annual compensation review process, the Compensation Committee discussed with FW Cook an analysis of our fiscal year 2020 executive compensation program, including total compensation and the elements used to compensate our NEOs. It then compared their compensation to that of similarly situated named executive officers of other companies in our compensation peer group. The review was based on public compensation data for our compensation peer group and data from third-party compensation surveys.

To best inform their pay decisions based on where the Company competes for talent, the Compensation Committee has established two categories for identifying peer companies:

 

   

Direct business competitors, plus any companies listed as peers by a majority of these companies that would be considered “peers of peers.”

 

   

Related-industry competitors who are S&P 500 companies (a) classified as financial services or technology, excluding hardware and manufacturing, (b) with a 12-month average market capitalization value between 1/4th and 4x Visa’s average market capitalization, and (c) with annual revenues of less than $150 billion.

A list of 22 companies identified as peers for fiscal year 2020 is shown below. These remain unchanged from our fiscal year 2019 peer group:

 

Direct Peers

 

   Related Industry Peers
  

Financial Services

 

  

Technology

 

– American Express Company

– Discover Financial Services

– Mastercard Incorporated

– PayPal Holdings, Inc.

  

– Bank of America Corporation

– BlackRock, Inc.

– Capital One Financial Corporation

– Citigroup Inc.

– JPMorgan Chase & Co.

– Morgan Stanley

– The Bank of New York Mellon Corporation

– The Goldman Sachs Group, Inc.

– The PNC Financial Services Group, Inc.

– U.S. Bancorp

– Wells Fargo & Company

 

  

– Accenture plc

– Facebook, Inc.

– Alphabet Inc.

– IBM Corporation

– Microsoft Corporation

– Oracle Corporation

– salesforce.com, inc.

In July 2020, using the methodology described above, the Compensation Committee reviewed the peer companies and added Adobe Inc. to the list of companies for fiscal year 2021. The Compensation Committee also considered Adobe Inc., in addition to the other companies listed above, when it made compensation decisions at the end of fiscal year 2020.

 

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Use of Market Data

In order to attract and retain key executives, we consider total compensation for our NEOs by reference to the range of compensation paid to similarly situated executive officers of our compensation peer group. This includes salary, annual incentive targets and long-term incentive values. The actual level of our NEOs’ total direct compensation is determined based on both individual and corporate performance and can vary based on such factors as expertise, performance or advancement potential.

Internal Equity and Tally Sheets

As part of its annual compensation review, the Compensation Committee compares our NEOs’ target annual compensation levels to ensure they are internally equitable. The Compensation Committee also regularly reviews tally sheets for each NEO to ensure that it is considering a complete assessment of all compensation and benefits. The tally sheets include the aggregate amount of equity awards and other compensation values accumulated by each NEO and potential payments upon termination or termination following a change of control.

Summary of Fiscal Year 2020 Base Salary and Incentive Compensation

In November 2020, the Compensation Committee determined our NEOs’ total direct compensation based on corporate and individual performance for fiscal year 2020. Their total direct compensation is composed of the following elements: base salary; annual incentive plan payments earned for performance in fiscal year 2020; and long-term equity incentives consisting of performance shares, stock options, and restricted stock units granted on November 19, 2020.

The table below reflects these components for each NEO for fiscal year 2020. As the long-term incentive awards for fiscal year 2020 set forth in the following table were awarded after the end of the fiscal year, they are discussed under the heading Fiscal Year 2021 Compensation. The equity awards discussed under the heading Fiscal Year 2020 Compensation – Long-Term Incentive Compensation refer to the equity awards made on November 19, 2019, during fiscal year 2020.

The table below differs substantially from the Summary Compensation Table for Fiscal Year 2020 later in this proxy statement in that the equity awards included in the table for fiscal year 2020 below were awarded on November 19, 2020 while the equity awards included in the Summary Compensation Table were granted on November 19, 2019. This supplemental table is not intended as a substitute for the information in the Summary Compensation Table for Fiscal Year 2020, which is required by the SEC.

 

             Incentive Compensation         
Name    Base
Salary
($)(1)
    

Annual
Incentive

Plan
($)(2)

     Value of
Performance
Shares
(target value)
($)(3)
    

Value of
Stock

Options
($)(4)

     Value of
Restricted
Stock/
Units
($)(4)
     Total
($)
 

Alfred F. Kelly, Jr.

  

 

1,550,000

 

  

 

3,100,000

 

  

 

10,250,000

 

  

 

5,125,000

 

  

 

5,125,000

 

  

 

25,150,000

 

Vasant M. Prabhu

  

 

1,100,000

 

  

 

1,760,000

 

  

 

5,250,000

 

  

 

2,625,000

 

  

 

2,625,000

 

  

 

13,360,000

 

Ryan McInerney

  

 

1,100,000

 

  

 

1,760,000

 

  

 

6,425,000

 

  

 

3,212,500

 

  

 

3,212,500

 

  

 

15,710,000

 

Rajat Taneja

  

 

1,100,000

 

  

 

1,760,000

 

  

 

6,100,000

 

  

 

3,050,000

 

  

 

3,050,000

 

  

 

15,060,000

 

Paul Fabara

  

 

750,000

 

  

 

900,000

 

  

 

1,912,500

 

  

 

956,250

 

  

 

956,250

 

  

 

5,475,000

 

 

(1)

Reflects the NEO’s rate of base salary as of September 30, 2020, which was effective October 1, 2019.

(2)

Reflects the payment pursuant to the annual incentive plan approved by the Compensation Committee in November 2020 and paid on November 13, 2020. These amounts are included in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table for Fiscal Year 2020.

 

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(3)

Reflects the target dollar value of performance shares approved by the Compensation Committee in November 2020 and awarded on November 19, 2020. Please see the heading Fiscal Year 2021 Compensation for additional information regarding these awards.

(4)

Reflects the dollar value of restricted stock units and stock option grants approved by the Compensation Committee in November 2020 and granted on November 19, 2020. The grant date fair value of these awards will be included in the fiscal year 2021 Summary Compensation Table in the proxy statement for the 2022 annual meeting of stockholders. Please see the heading Fiscal Year 2021 Compensation for additional information regarding these awards.

Fiscal Year 2020 Compensation

Base Salary

When setting our NEOs’ base pay, the Compensation Committee generally considers the range of compensation paid to similarly situated executive officers of our compensation peer group. The Compensation Committee may set salaries relative to this range based on considerations including the expertise, performance or advancement potential of each NEO, including relative to other NEOs. The base salary levels of our NEOs typically are considered annually as part of our performance review process, and upon an NEO’s promotion or other change in job responsibilities.

During its annual review of the base salaries of our NEOs for fiscal year 2020, the Compensation Committee considered:

 

   

market data of our compensation peer group;

 

   

an internal review of each NEO’s compensation, both individually and relative to other NEOs; and

 

   

the individual performance of each NEO.

Based on this review, in consultation with FW Cook, the Compensation Committee decided that it was appropriate to increase Mr. Kelly’s base salary to $1,550,000 from $1,400,000 and to increase Mr. McInerney’s, Mr. Taneja’s, and Mr. Prabhu’s base salaries to $1,100,000 from $900,000, $900,000 and $1,000,000, respectively, for fiscal year 2020, effective October 1, 2019.

Annual Incentive Plan

 

 

LOGO

Incentive Plan Target Percentage. During fiscal year 2020, each of our NEOs was eligible to earn an annual cash incentive award under the Visa Inc. Incentive Plan, or VIP, which we sometimes refer to as our annual incentive plan. Each NEO’s potential award was expressed as a percentage of his base salary, including threshold, target and maximum percentages. After the end of the fiscal year, the Compensation Committee determined the amount of each NEO’s actual annual incentive award based upon the achievement of a combination of pre-determined corporate and individual goals. As described in more detail below and detailed in the table entitled Annual Incentive Plan Awards for Fiscal Year 2020, each NEO received a total fiscal year 2020 annual incentive payout below his target payout percentage.

The annual incentive plan balances the NEOs’ shared responsibility to achieve both corporate and individual goals. If the baseline goal is not reached for both the Net Income Growth and the Net Revenue Growth metrics, then the amount paid for the portion of the annual incentive attributable to corporate performance will be zero. The portion of the annual incentive attributable to individual performance is evaluated separately and may be paid regardless of Net Income Growth or Net Revenue Growth results.

 

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For our NEOs other than our Chairman and Chief Executive Officer, the performance factor weightings were initially set at 70% for Corporate Performance and 30% for Individual Performance. For our Chairman and Chief Executive Officer, the weightings were initially set at 80% for Corporate Performance and 20% for Individual Performance. Implications of the global pandemic, however, caused the Compensation Committee to consider the appropriate allocation between corporate and individual performance in the annual incentive plan design for fiscal year 2020. Following the start of the global pandemic, our NEOs were necessarily focused on individual operational goals and on leading Visa and our employees through the significant impact of COVID-19. These updated priorities, including keeping employees safe, engaged, and motivated; securing the integrity of our network; delivering high quality customer service and support; advancing ESG initiatives; maintaining liquidity; and continuing to pursue Visa’s long-term strategy, drove the NEOs’ actions in the second half of the fiscal year and would define their success during this period. As a result, and in consultation with FW Cook, the Compensation Committee decided to place increased emphasis on individual performance by adjusting the weighting of the Individual Performance component to 50% for these executives. The Compensation Committee also decided not to revise the financial goals in the Corporate Performance component in light of the ongoing global economic uncertainty caused by COVID-19.

This change to the weighting was due to global factors outside the scope of management’s control and was implemented to recognize the updated operational priorities and to motivate and incentivize our NEOs to focus on the overall success of our business, employees, clients, and communities during this extraordinary year. The Compensation Committee determined that this change would be reflective of the performance-based nature of the annual incentive plan, with the NEOs’ contributions measured against pre-established performance goals. The payout percentage for the Corporate Performance component would have been 0% under the original allocation, as it was under the revised weighting.

Corporate Performance Measures and Results for Fiscal Year 2020

In November 2019, the Compensation Committee approved the corporate performance weightings, targets and metrics for fiscal year 2020, as well as the potential payout ranges for the NEOs, as displayed in the table below. The table below also includes actual fiscal year 2020 results and the final payout of 0% of target for each NEO.

 

Metric   Weight   Baseline   Below
Target
  Below
Target
  Target   Above
Target
  Above
Target
  Above
Target
  Significantly
Above
Target
  Result   Payout

Net Income Growth – VIP adjusted

  70%   5-6.5%   6.5-8%   8-9.5%   9.5-11%   11-12.5%   12.5-14%   14-15.5%   15.5%+   -9.1%   0%

Net Revenue Growth – VIP adjusted

  30%   6-8%   8-9%   9-10%   10-11%   11-12%   12-13%   13-14%   14%+   -4.9%   0%

 

                     

 

Payout as a % of Target

      50-70%   70-85%   85-100%   100-115%   115-135%   135-155%   155-175%   175-200%       0%

For purposes of the annual incentive plan, our Net Income Growth – VIP adjusted for fiscal year 2020 was determined by adjusting our U.S. GAAP Net Income to exclude the impact of certain items that we believe were not representative of our continuing operations, as they may have been non-recurring or had no cash impact, and may distort our long-term operating trends, as well as other pre-established adjustments made in accordance with the terms of the annual incentive plan determined at the beginning of fiscal year 2020, such as VIP expenses and net income related to acquisitions closed during fiscal 2020. The result, as shown above, was below the baseline established by the Compensation Committee for our NEOs to receive any payment related to the Net Income Growth component.

Our Net Revenue Growth – VIP adjusted for fiscal year 2020 was determined as year-over-year growth in gross revenues net of client incentives, adjusted to exclude pre-established adjustments made in accordance with the terms of the annual incentive plan determined at the beginning of fiscal year 2020, such as the net revenue related to acquisitions closed during fiscal year 2020. The result, as shown above, was also below the baseline established by the Compensation Committee for our NEOs to receive any payment related to the Net Revenue Growth component.

 

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Even with the extraordinary efforts of the executive team to manage the impact of COVID-19 during the year, the financial climate in the second half of fiscal year 2020, particularly the decline in cross-border travel, prevented the achievement of the Net Revenue Growth and Net Income Growth goals that the Compensation Committee established for the annual incentive plan in November 2019, prior to the start of the global pandemic. Although the Company’s financial performance in the first half of the fiscal year was on track to result in a payment under the annual incentive plan, final performance for each metric fell below the minimum goal established by the Compensation Committee at the beginning of the fiscal year. The Compensation Committee decided not to revise the financial goals in light of the ongoing global economic uncertainty caused by COVID-19. As a result, our NEOs received no payout for the portion of the annual incentive plan attributable to achievement of corporate financial results.

Individual Performance Goals and Results for Fiscal Year 2020

Fiscal year 2020 individual goals for each of our NEOs were initially set in October 2019 through January 2020, prior to the onset of COVID-19. The individual goals were updated in April 2020 to reflect changing business priorities and the extraordinary circumstances caused by COVID-19, and to ensure that our executive officers remain focused on the well-being of our employees, clients, and the communities in which we operate; the security of our network; delivering high quality client service and support; advancing ESG initiatives; maintaining liquidity; and continuing to pursue Visa’s long-term strategy. The updated goals focused on the following:

 

   

employee health, safety, engagement, inclusion and diversity, and development of a re-entry program for returning to the office;

 

   

ensuring the efficiency and security of our network so that cyber protections remain the highest priority while also maintaining overall system performance;

 

   

engaging with governments to support their needs for data and advice and pursuing programs to disburse public funds;

 

   

continuing to partner with and support clients and securing new deals;

 

   

effectively but thoughtfully reducing expenses; and

 

   

strategic planning for executing Visa’s business beyond fiscal year 2020, including development of a plan to assist in spending recovery, managing key risks facing Visa, and continuing to develop M&A strategy.

The Compensation Committee believes that our NEOs’ performance goals should support the Company’s long-term strategy. Individual goals may be tied to NEOs’ specific areas of responsibility, or they may be common goals that are shared by every executive officer. Individual performance goals for the Chairman and Chief Executive Officer were established with the oversight of the Compensation Committee. Individual performance goals for the other NEOs were proposed by the Chairman and Chief Executive Officer and confirmed by the Compensation Committee.

As described under How our Incentive Program is Tied to our Long-Term Strategy earlier in this proxy statement, these goals were established by reference to our corporate strategy, which is designed to position the Company competitively and thereby deliver superior performance, and which should in turn create value for our stockholders and benefit our employees, clients and communities. To ensure that our executive officers stay focused on these objectives, a significant number of their individual performance goals were tied to one or more of the strategic objectives. Of note, our strategy includes fortifying our strong foundation by continuing to invest in our technology platforms, security and talent. Prior to and following the onset of COVID-19, our executive officers had goals to attract and retain top talent, including creating an inclusive environment for our employees, and a commitment to attract, develop and retain diverse employees, including women and underrepresented talent. Following the commencement of the global pandemic, our executive officers also had goals focused on the health, safety, engagement and productivity of our employees and developing an effective return to offices plan. At the start of the fiscal year and continuing through the global pandemic, our executive officers also had goals to ensure the security of our technology platforms for our business and clients.

 

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After the end of the fiscal year, the Compensation Committee, based on each NEO’s self-assessment and Mr. Kelly’s input, evaluated each NEO’s accomplishments against his previously identified individual performance goals. Based on this assessment, an NEO could receive 0% to 200% of the individual portion of his annual incentive award. When making its award determinations, the Compensation Committee did not assign a specific weighting to any of the individual goals, but instead evaluated each NEO’s accomplishments against his individual goals in the aggregate. The following is a summary description of each NEO’s individual performance achievements for fiscal year 2020.

 

Mr. Kelly

 

Performance Results

FY2020

Performance

Results

 

•  Effectively managed expenses and liquidity; maintained strong settlement and credit risk monitoring; and ensured resiliency of business operations

 

•  Successfully delivered on key partnerships and deepened client engagement

 

•  Demonstrated exceptional leadership of Visa employees, including committing to no employee layoffs in 2020 due to COVID-19, increased communication and employee engagement, and championing inclusion and diversity

 

•  Worked with governments to support their needs, including programs for disbursement of public funds

 

•  Continued to build on strong global brand and strong control environment

 

Mr. Prabhu

 

Performance Results

FY2020

Performance

Results

 

•  Performed strongly against financial measures, including maintaining strong liquidity position during COVID-19 and access to debt markets

 

•  Effectively controlled expenditures and instituted rigorous finance processes in response to the pandemic

 

•  Provided leadership on acquisitions and ventures

 

•  Demonstrated progress in attracting, developing, and retaining diverse talent

 

Mr. McInerney

 

Performance Results

FY2020

Performance

Results

 

•  Successfully renewed key partnerships and completed new partnerships that will drive future growth

 

•  Executed strategies to grow revenue from Value Added Services

 

•  Drove initiatives to grow new money movement flows via Network of Networks strategy

 

•  Successfully executed regional and country business strategies

 

•  Led global programs to help Visa, its employees, and partners successfully navigate challenges related to COVID-19

 

Mr. Taneja

 

Performance Results

FY2020

Performance

Results

 

•  Secured Visa assets from cyber threats by deepening our technical and security defenses

 

•  Demonstrated operational excellence, including continued focus on high resilience of our transaction systems

 

•  Delivered strong support of product innovation priorities and continued strategic transformation of Visa technology

 

•  Continued focus on diversity, including hiring and career development opportunities

 

Mr. Fabara

 

Performance Results

FY2020

Performance

Results

 

•  Maintained strong risk, control, and compliance environment and enhanced Visa’s ability to detect and monitor internal risks

 

•  Developed new capabilities to monitor and eradicate ecosystem risk, as well as new prevention and protection capabilities

 

•  Enhanced data privacy support, governance, data usage practices, and data incident response

 

•  Developed employee engagement and inclusion and diversity programs

 

 

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In addition to the individual accomplishments described above, as a group the NEOs contributed to the following key performance results:

 

   

Visa met its commitment to use 100% renewable energy by calendar year 2020 through energy sources such as solar and wind.

 

   

Visa expanded its commitment to sustainability through the launch of its inaugural $500 million green bond, believed to be the first issued by a digital payments network, to help advance our commitment to environmental sustainability and a sustainable payments ecosystem.

 

   

Visa fulfilled its five-year commitment to provide 500 million previously unbanked or underserved people, of which 54% are women and around one-third are rural or lower income account holders, with access to a Visa branded payment account by calendar year 2020.

 

   

Visa made a global commitment to elevate 50 million small and micro businesses worldwide in an effort to get local communities back to business in the wake of COVID-19.

 

   

In June 2020, Visa announced five actions it would take in support of social justice, including the establishment of the Visa Black Scholars & Jobs program.

 

   

In July 2020, Visa announced a goal to increase our underrepresented employee population at the Vice President and above level in the U.S. by 50% over three years and our overall underrepresented employee population in the U.S. by 50% over five years.

Based on each NEO’s performance in managing his function and the Compensation Committee’s evaluation of each NEO’s specific accomplishments relative to the individual goals as discussed above, the Compensation Committee, in its discretion, determined that the portion of the annual incentive attributable to achievement of individual performance goals would be paid at 160% of the target established by the Compensation Committee for each NEO.

Annual Incentive Plan Awards for Fiscal Year 2020

The payouts under our annual incentive plan are computed based on individual and corporate performance, as outlined above. The fiscal year 2020 annual cash incentive award payments are included in the “Non-Equity Incentive Plan Compensation” column of the Summary Compensation Table for Fiscal Year 2020, and are set forth in the following table.

 

         
 

Annual

 Base Salary 

  ×      

 Target Annual 

Incentive %

  ×   [      

Corporate

 Performance 

  ×      

Corporate

 Weighting 

  +    

Individual

 Performance 

  ×    

Individual

 Weighting 

  ]   =    

Final

 Award 

 

           Target(1)     Actual
     Annual
Base
Salary
   

Target

Annual

Incentive %

 

Target

Annual Cash

Incentive $

    Corporate         Individual   Final
Award
$
   

Final

Award as %

of Target

     Performance
%
        Factor
Weighting
        Performance
%
  Factor
Weighting
                       

Alfred F. Kelly, Jr.

  $ 1,550,000     250%     $3,875,000     0%     x     50%     +     160%   ×  50%   $ 3,100,000     80%
 

Vasant M. Prabhu

  $ 1,100,000     200%     $2,200,000     0%     x     50%     +     160%   ×  50%   $ 1,760,000     80%
 

Ryan McInerney

  $ 1,100,000     200%     $2,200,000     0%     x     50%     +     160%   ×  50%   $ 1,760,000     80%
 

Rajat Taneja

  $ 1,100,000     200%     $2,200,000     0%     x     50%     +     160%   ×  50%   $ 1,760,000     80%
 

Paul Fabara

  $ 750,000     150%     $1,125,000     0%     x     50%     +     160%   ×  50%   $ 900,000     80%

 

(1)

The “threshold” and “maximum” amounts are provided under the Grants of Plan-Based Awards in Fiscal Year 2020 Table.

Long-Term Incentive Compensation

The Visa Inc. 2007 Equity Incentive Compensation Plan, which we refer to as the equity incentive plan, is intended to promote our long-term success and increase stockholder value by attracting, motivating and retaining

 

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our non-employee directors, officers, and employees. Additionally, to better align our executive officers’ long-term interests with those of our stockholders, the equity incentive plan does not allow the repricing of stock grants once they are awarded, without prior stockholder approval.

The Compensation Committee administers the equity incentive plan with respect to our NEOs and determines, in its discretion and in accordance with the terms of the equity incentive plan, the recipients who may be granted awards, the form and amount of awards, the terms and conditions of awards (including vesting and forfeiture conditions), the timing of awards, and the form and content of award agreements.

Long-Term Incentive Awards Granted in Fiscal Year 2020

In determining the types and amounts of annual equity awards to be granted to our NEOs in fiscal year 2020, the Compensation Committee considered, in consultation with FW Cook, factors including the practices of companies in our compensation peer group, the actual compensation levels of similarly situated executive officers of companies in our compensation peer group, corporate and individual performance, recommendations from our Chairman and Chief Executive Officer (for awards to the NEOs other than himself) and each NEO’s total compensation. The Compensation Committee also considered the incentives provided by different award types, including increasing stockholder value, avoiding excessive risk taking and encouraging employee retention.

The annual equity awards granted to each NEO in fiscal year 2020 consisted of 25% stock options, 25% restricted stock units, and 50% performance shares. Each award type is used to retain and incentivize key executive officers. Stock options generate value only if Visa’s stock price appreciates after the grant date, and performance shares are designed so that the number of shares that are earned varies based on corporate performance results.

The following table displays the total combined value of annual equity awards approved by the Compensation Committee for our NEOs in fiscal year 2020, and the award value broken down by component.

 

     

Total

Combined Value of
Equity Awards

($)

 

    

Components of annual awards granted on
November 19, 2019

 

 
  

Value of
Stock Options
($)

 

    

Value of
Restricted
Stock Units
($)

 

    

 

Value of
Performance

Shares at

Target

($)(1)

 

 
         

Alfred F. Kelly, Jr.

 

    

 

18,250,000     

 

 

    

 

4,562,500   

 

 

    

 

4,562,500  

 

 

    

 

9,125,000  

 

 

 

Vasant M. Prabhu

 

    

 

8,500,000     

 

 

    

 

2,125,000   

 

 

    

 

2,125,000  

 

 

    

 

4,250,000  

 

 

 

Ryan McInerney

 

    

 

10,500,000     

 

 

    

 

2,625,000   

 

 

    

 

2,625,000  

 

 

    

 

5,250,000  

 

 

 

Rajat Taneja

 

    

 

10,000,000     

 

 

    

 

2,500,000   

 

 

    

 

2,500,000  

 

 

    

 

5,000,000  

 

 

 

Paul Fabara

 

    

 

3,125,000     

 

 

    

 

781,250   

 

 

    

 

781,250  

 

 

    

 

1,562,500  

 

 

 

(1)

As the aggregate grant date fair values of the performance shares displayed in the Summary Compensation Table for Fiscal Year 2020 and the Grants of Plan-Based Awards in Fiscal Year 2020 Table later in this proxy statement are computed in accordance with stock-based accounting rules and will be displayed in multiple years, the values in those tables differ from the value displayed in the table above.

Stock Options and Restricted Stock Units

The dollar value of the annual equity awards in the table above were converted to a specific number of options or restricted stock units on the November 19, 2019 grant date, based on the fair market value of our Class A common stock on that date and the Black-Scholes value of stock options. The stock options and restricted stock units vest in three substantially equal annual installments beginning on the first anniversary of the date of grant, subject to continued employment through each such vesting date.

 

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Performance Shares

The value displayed for performance shares in the table above reflects the target value of the annual award. The target number of performance shares is determined at the beginning of a three-year performance period and the number of shares earned at the end of the three-year period will range from zero to 200% of target depending on our corporate performance, as measured by:

 

   

the annual EPS goal established for each fiscal year; and

 

   

an overall modifier based on Visa’s TSR ranked relative to S&P 500 companies, or TSR Rank, over the three-year performance period.

Vesting of the performance shares is generally subject to the NEOs’ continued employment through the entire three-year performance period, except upon certain terminations of employment due to death, disability, retirement, and certain qualifying (“double-trigger”) terminations in connection with a change in control.

FY2020-FY2022 Performance Share Design

 

 

LOGO

Impact of Stock Buybacks on EPS

The amount of stock buy-backs are budgeted at the beginning of the year. If Visa repurchased stock significantly above or below this level, the EPS result would be adjusted for the difference.

The TSR Rank Modifier

The TSR Rank modifier will reduce the number of shares that are earned for periods when our stockholders’ value increase is below the median of the companies comprising the S&P 500 and will increase the number of shares that are earned for periods when our stockholders’ value increase exceeds the median of the companies comprising the S&P 500. The total number of shares that may be earned at the end of the three-year period is capped at 200% of the target number of shares.

 

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EPS Goals

One-third of the target performance shares awarded on November 19, 2019 was tied to the fiscal year 2020 EPS goal that the Compensation Committee established within the first ninety days of fiscal year 2020. The remaining two-thirds of the target shares awarded is tied to the EPS goals for each of fiscal years 2021 and 2022, which will be set by the Compensation Committee within the first ninety days of the respective fiscal year. The actual EPS result will be used to determine the percentage of target shares credited from each of the three award segments. At the end of fiscal year 2020, the Compensation Committee reviewed our EPS – PS adjusted of $5.01, which was determined by excluding from U.S. GAAP EPS the aforementioned adjustments from U.S. GAAP Net Income described under the heading Corporate Performance Measures and Results for Fiscal Year 2020, as well as other adjustments including net income related to acquisitions closed during fiscal year 2020. All of the Compensation Committee’s adjustments were made in accordance with terms determined at the beginning of fiscal year 2020, as described earlier under Setting Performance Goals and Making Compensation Determinations. The Compensation Committee determined that the final EPS – PS adjusted result of $5.01 was below the minimum goal of $5.68 for fiscal year 2020. As a result, the payout percentage of target is zero for the portion of the performance shares related to fiscal year 2020 EPS performance.

At the completion of the entire three-year performance period in November 2022, the shares credited from the above EPS calculations for the three fiscal years (including the zero shares for fiscal year 2020) will be totaled and the overall number of shares will be modified based on Visa’s TSR Rank for the full three-year period. This TSR Rank modification may increase or decrease the final number of shares earned by a maximum of 25% (see chart below); however, the final number of shares earned at the end of the three-year period, after the modification is applied, is capped at 200% of the initial target number.

 

     

Threshold

Performance

 

Target

Performance

 

Maximum

Performance

Modifying Metric

  

75%

 

100%

 

125%

 

3 Year Visa TSR Rank vs. S&P 500

  

 

25th Percentile or

Below

 

 

50th Percentile(1)

 

 

75th Percentile or

Above

 

(1)

Results between the 25th percentile and the 50th percentile and between the 50th percentile and the 75th percentile are interpolated between 75% and 100% or 100% and 125%, respectively.

 

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The EPS goal for fiscal year 2020 and actual EPS results discussed above also apply to the third portion of the performance shares previously awarded to our NEOs on November 19, 2017 and the second portion of the performance shares previously awarded to our NEOs on November 19, 2018 (see illustration below).

 

 

LOGO

Consistent with Financial Standards Accounting Board ASC Topic 718, the value of the performance share awards for fiscal year 2020 included in the “Stock Awards” column of the Summary Compensation Table for Fiscal Year 2020 later in this proxy statement represents the third segment of the award made on November 19, 2017, the second segment of the award made on November 19, 2018 and the first segment of the award made on November 19, 2019.

Determination of Shares Earned for Performance Shares Previously Awarded on November 19, 2017

The performance shares previously awarded to NEOs on November 19, 2017 completed their three-year performance period following fiscal year 2020. As a result, the Compensation Committee determined and certified the Company’s actual results over the three-year period in November 2020, which determined the final number of shares earned pursuant to those awards. As illustrated below, based on the annual EPS results for fiscal years 2018, 2019 and 2020, and our TSR Rank over the three-year period, the performance shares earned equated to 127.7% of the target award established on November 19, 2017.

 

Primary Metric

 

  

Threshold

($)

 

  

Target

($)

 

  

Maximum

($)

 

  

Result

($)

 

  

EPS Result as %

of Target(1)

 

 

 

Fiscal Year 2018 EPS

 

  

 

3.77

 

  

 

4.05

 

  

 

4.33

 

  

 

4.27

 

  

 

 

 

 

179.5% of Target

 

 

 

 

 

Fiscal Year 2019 EPS

 

  

 

4.98

 

  

 

5.35

 

  

 

5.72

 

  

 

5.45

 

  

 

 

 

 

127.0% of Target

 

 

 

 

 

Fiscal Year 2020 EPS

 

  

 

5.68

 

  

 

6.11

 

  

 

6.54

 

  

 

5.01

 

  

 

 

 

 

0.0% of Target

 

 

 

 

                

 

 

 

 

Average Result

 

                        

 

102.2% of Target

 

 

 

 

(1)

Percentage is based on unrounded values.

 

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Modifying Metric

 

  

Threshold

(75% modifier)

 

  

Target

(100%
modifier)

 

  

Maximum

(125%
modifier)

 

  

Result

 

  

Modifier %

 

 

3 Year TSR Rank v. S&P 500

 

  

 

25th percentile

 

  

 

50th percentile

 

  

 

75th percentile

 

  

 

83rd percentile

 

   125%

 

Primary Metric Result

 

  

Times

 

  

Modifying Metric

 

  

Equals

 

  

Final Payout Result

as a % of Target

(capped at 200%)

 

 

102.2%

 

  

 

x

 

  

 

125%

 

  

 

=

 

  

 

127.7%

 

Based on this Final Payout Result of 127.7%, on November 30, 2020, Mr. Kelly, Mr. McInerney, Mr. Prabhu, and Mr. Taneja earned shares equal to 127.7% of the target number of shares granted to each of them on November 19, 2017. As a result, Mr. Kelly earned 81,397 shares versus his target of 63,741 shares, Mr. McInerney earned 52,326 shares versus his target of 40,976 shares, Mr. Prabhu earned 46,512 shares versus his target of 36,423 shares, and Mr. Taneja earned 49,420 shares versus his target of 38,700 shares.

One-Time Compensation Arrangements for Mr. Fabara

The Compensation Committee may approve compensation during the fiscal year to attract new executive officers and incentivize them to join Visa. The following one-time compensation arrangements are not considered to be a part of Mr. Fabara’s ongoing target annual compensation.

In connection with his hiring, on October 15, 2019, Mr. Fabara was granted a one-time, new hire equity award with a grant date fair market value of $1,200,000, consisting of $300,000 in stock options and $900,000 in restricted stock units. Fifty percent of this new hire award vested on October 15, 2020, and the balance of the award is scheduled to vest, subject to Mr. Fabara’s continued employment, on October 15, 2021.

Mr. Fabara was granted an additional one-time equity award to compensate him for the value of unvested equity and other incentives that were forfeited when he left his prior employer. The grant date fair market value of this award was $9,200,000, consisting of $2,300,000 in stock options and $6,900,000 in restricted stock units. Thirty-four percent of this award vested on January 31, 2020, and thirty-three percent is scheduled to vest, subject to Mr. Fabara’s continued employment, on each of January 31, 2021 and January 31, 2022.

Also in connection with his hiring, Mr. Fabara was required to reimburse his prior employer for the value of certain incentive compensation. The Company agreed to reimburse Mr. Fabara for the value of this reimbursement, including a gross-up for certain taxable amounts. This payment is reported in the “All Other Compensation” column of the Summary Compensation Table for Fiscal Year 2020. In the event Mr. Fabara voluntarily terminates his employment or is terminated involuntarily for Cause (as defined in the applicable reimbursement agreement) prior to September 3, 2022, Mr. Fabara is required to reimburse Visa amounts paid under the reimbursement arrangement on a pro-rata basis.

Retirement and Other Benefits

Our benefits program is designed to be competitive and cost-effective. It is our objective to provide core benefits, including medical, retirement, life insurance, paid time off and leaves of absence, to all employees and to allow for supplementary non-core benefits to accommodate regulatory, cultural and practical differences in the various geographies in which we have operations.

We sponsor a frozen tax-qualified defined benefit pension plan, which we refer to as the retirement plan. We also sponsor a tax-qualified defined contribution 401(k) plan, which we refer to as the 401k plan, to provide market driven retirement benefits to all eligible employees in the United States.

 

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We maintained a non-qualified excess retirement benefit plan and a non-qualified excess 401k plan to make up for the limitations imposed on our tax-qualified plans by the Internal Revenue Code. New contributions to these non-qualified plans ceased effective February 1, 2014. We also sponsor an unfunded, non-qualified deferred compensation plan, which we refer to as the deferred compensation plan, which allows executive officers and certain other highly compensated employees to defer a portion of their annual incentive awards and sign-on bonuses to help them with tax planning and to provide competitive benefits. For additional information on these plans, see the sections entitled Executive Compensation – Pension Benefits Table for Fiscal Year 2020 and Executive Compensation – Non-qualified Deferred Compensation for Fiscal Year 2020.

Perquisites and Other Personal Benefits

We provide limited perquisites and other personal benefits to facilitate the performance of our NEOs’ management responsibilities. For instance, we maintain a company car and driver that allows for additional security, which are used by the Chairman and Chief Executive Officer for both business and personal use, as well as some business and limited personal use by other executive officers. From time to time, our NEOs also may use the Company’s tickets for sporting, cultural or other events for personal use rather than business purposes. If an incremental cost is incurred for such use, it is included in the “All Other Compensation” column of the Summary Compensation Table for Fiscal Year 2020 if the aggregate amount paid by the Company in Fiscal Year 2020 for an executive equaled $10,000 or more.

In addition, we have a policy that allows for companion travel on business-related flights on our corporate aircraft by the Chairman and Chief Executive Officer, the President and other key employees, as approved by the Chairman and Chief Executive Officer. It is our policy that NEOs are responsible for all income taxes related to their personal usage of the Company car or corporate aircraft, as well as travel by their companions. Additionally, no NEO may use the corporate aircraft for exclusive personal use (not related to business) except under the terms and conditions outlined in the Company’s aircraft time-sharing agreement with the Chairman and Chief Executive Officer, or under extraordinary circumstances with the advance approval of the Chairman and Chief Executive Officer. In fiscal year 2020, the Compensation Committee mandated that Mr. Kelly use the aircraft for all business and personal travel, based on an independent third party finding of a bona fide security concern, which recommended that Mr. Kelly use the aircraft for all travel. Related to this requirement, the Compensation Committee approved an amendment to the time-sharing agreement to provide that, effective as of November 1, 2019, Mr. Kelly is required to reimburse Visa for personal use of the aircraft for amounts in excess of $200,000 per fiscal year. Any personal use of the aircraft in excess of this limit by our Chairman and Chief Executive Officer pursuant to the aircraft time-sharing agreement requires him to reimburse Visa an amount (as determined by the Company) equal to the lesser of: (i) the amount that would, absent reimbursement, be reportable with respect to the Chairman and Chief Executive Officer in the Summary Compensation Table (which we refer to as the SEC Cost), or (ii) the expenses of operating such flight that may be charged pursuant to Federal Aviation Regulation Section 91.501(d) as in effect from time to time (which we refer to as the FAR Expenses). The Chairman and Chief Executive Officer’s personal use of the corporate aircraft is also subject to an annual cap of $500,000, as determined by the Company using the lesser of the SEC Cost and the FAR Expenses.

Severance

We believe that it is appropriate to provide severance to an executive officer in certain circumstances. We do not provide for gross-ups for excise taxes that may be imposed as a result of severance payments and, for payments payable upon or following a change of control, we generally require a qualifying termination of employment in addition to the change of control. Please see the section entitled Employment Arrangements and Potential Payments upon Termination or Change of Control – Executive Severance Plan for additional information.

 

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Offer Letter with Paul Fabara

We have outstanding obligations under an executed offer letter with Mr. Fabara, in connection with his commencement of employment by Visa. Please see the description of the offer letter in the section entitled Employment Arrangement and Potential Payments upon Termination or Change of Control – Offer Letter with Paul Fabara.

Fiscal Year 2021 Compensation

On November 3, 2020, the Compensation Committee approved fiscal year 2021 compensation for the NEOs, which included no change to their base salaries or annual incentive target opportunities. In light of the ongoing global economic uncertainty caused by COVID-19 and the desire to better balance annual incentive determinations based on financial and non-financial strategic and individual performance considerations, the Compensation Committee approved a scorecard approach for fiscal year 2021 annual incentive awards. Performance metrics are in four categories, under which formulaic and non-formulaic goals will be pre-established in each category, reviewed during the year, and evaluated at year-end. The categories are Financial Goals; Client Goals; Foundational Business Goals; and ESG, Technology, and Other Corporate Priority Goals.

The Compensation Committee also approved the annual equity awards for our NEOs to be granted on November 19, 2020, using a combination of 25% of the total value of equity awards in stock options, 25% in restricted stock units, and 50% in performance shares, reflecting the same mix as used in prior years. The actual number of performance shares earned will be based on the following:

 

   

the annual EPS goal established for each of the three fiscal years in the performance period; and

 

   

an overall modifier based on our TSR Rank over the three-year performance period.

Vesting of the equity awards is generally subject to the NEOs’ continued employment through the entire three-year performance period, except upon certain terminations of employment due to death, disability, retirement, and certain qualifying (“double-trigger”) terminations in connection with a change in control.

Consistent with prior fiscal years, the total combined value of each equity award was approved by the Compensation Committee after considering, in consultation with FW Cook, the practices of companies in our compensation peer group, the actual compensation levels of similarly situated executive officers of companies in our compensation peer group, corporate and individual performance during fiscal year 2020, recommendations from our Chairman and Chief Executive Officer (for awards to the NEOs other than himself) and each NEO’s total compensation. The Compensation Committee also considered the value of outstanding awards held by the NEOs. The table below displays the total grant date fair value of the grants approved in November 2020 as well as the value of each component.

 

             Components  
     

Total

Value of
Equity Awards
($)

 

    

Value of Stock
Options

($)

 

    

Value of
Restricted
Stock Units

($)

 

    

Value of
Performance
Shares

($)

 

 

 

Alfred F. Kelly, Jr.

 

  

 

 

 

 

20,500,000

 

 

 

 

  

 

 

 

 

5,125,000

 

 

 

 

  

 

 

 

 

5,125,000

 

 

 

 

  

 

 

 

 

10,250,000

 

 

 

 

 

Vasant M. Prabhu

 

  

 

 

 

 

10,500,000

 

 

 

 

  

 

 

 

 

2,625,000

 

 

 

 

  

 

 

 

 

2,625,000

 

 

 

 

  

 

 

 

 

5,250,000

 

 

 

 

 

Ryan McInerney

 

  

 

 

 

 

12,850,000

 

 

 

 

  

 

 

 

 

3,212,500

 

 

 

 

  

 

 

 

 

3,212,500

 

 

 

 

  

 

 

 

 

6,425,000

 

 

 

 

 

Rajat Taneja

 

  

 

 

 

 

12,200,000

 

 

 

 

  

 

 

 

 

3,050,000

 

 

 

 

  

 

 

 

 

3,050,000

 

 

 

 

  

 

 

 

 

6,100,000

 

 

 

 

 

Paul Fabara

 

  

 

 

 

 

3,825,000

 

 

 

 

  

 

 

 

 

956,250

 

 

 

 

  

 

 

 

 

956,250

 

 

 

 

  

 

 

 

 

1,912,500

 

 

 

 

 

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Other Equity Grant Practices and Policies

Stock Grant Practices

The Compensation Committee maintains an equity grant policy, which contains procedures to prevent stock option backdating and other grant timing issues. Under the equity grant policy, the Compensation Committee approves annual grants to executive officers and other members of the executive committee at a meeting to occur during the quarter following each fiscal year end. The Board has delegated the authority to Mr. Kelly as the sole member of the stock committee to make annual awards to employees who are not members of the executive committee. The grant date for annual awards to all employees has been established as November 19 of each year.

In addition to the annual grants, stock awards may be granted at other times during the year to new hires, employees receiving promotions, and in other special circumstances. The equity grant policy provides that only the Compensation Committee may make such “off-cycle” grants to NEOs and other members of management’s executive committee. The Compensation Committee has delegated the authority to the stock committee to make “off-cycle” grants to other employees, subject to guidelines established by the Compensation Committee. Any “off-cycle” awards approved by the stock committee or the Compensation Committee are granted on the 15th day of the calendar month or on such other date determined by the stock committee, Compensation Committee or the Board.

For all newly issued stock option awards, the exercise price will be the closing price of our Class A common stock on the NYSE on the date of the grant. If the grant date for the annual awards falls on a non-trading day, the exercise price of stock option awards will be the closing price of our Class A common stock on the NYSE on the last trading day preceding the date of grant.

Stock Ownership Guidelines

The Compensation Committee maintains stock ownership guidelines for our executive officers as follows:

 

Officer    Stock Ownership Guidelines

Alfred F. Kelly, Jr.

  

6 x base salary

Vasant M. Prabhu

  

4 x base salary

Ryan McInerney

  

4 x base salary

Rajat Taneja

  

4 x base salary

Paul Fabara

  

3 x base salary

Equity interests that count toward the satisfaction of the ownership guidelines include shares owned outright by the NEO, shares jointly owned, restricted stock and restricted stock units payable in shares. Newly hired or promoted executives have five years from the date of the commencement of their appointment to attain these ownership levels. Each NEO currently meets or exceeds the applicable guideline set forth in the table above. If an executive officer does not meet the applicable guideline by the end of the five-year period, the executive officer is required to hold a minimum of 50% of the net shares resulting from any future vesting of restricted stock, restricted stock units, performance shares or exercise of stock options until the guideline is met. These guidelines reinforce the importance of aligning the interests of our executive officers with the interests of our stockholders and encourage our executive officers to consider the long-term perspective when managing the Company.

Hedging and Pledging Prohibition

As part of our insider trading policy, all employees, including our NEOs, and non-employee directors are prohibited from engaging in short sales of our securities, establishing margin accounts related to our securities, pledging our securities as collateral for a loan, buying or selling puts or calls on our securities or otherwise engaging in hedging transactions (such as zero-cost collars, exchange funds, and forward sale contracts) involving our securities.

 

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Policy Regarding Clawback and Forfeiture of Incentive Compensation

We have a Clawback Policy pursuant to which NEOs and other key executive officers may be required to reimburse or forfeit incentive compensation paid to them if the financial results upon which the awards were based are materially restated due to fraud, intentional misconduct or gross negligence of the executive officer.

The Clawback Policy permits the Board to determine in its discretion if it will seek to recover applicable compensation, taking into account the following considerations as it deems appropriate:

 

   

Whether the amount of any bonus or equity compensation paid or awarded during the covered time period, based on the achievement of specific performance targets, would have been reduced based on the restated financial results;

 

   

The likelihood of success of recouping the compensation under governing law relative to the effort involved;

 

   

Whether the recoupment may prejudice Visa’s interest in any related proceeding or investigation;

 

   

Whether the expense required to recoup the compensation is likely to exceed the amount to be recovered;

 

   

The passage of time since the occurrence of the misconduct;

 

   

Any pending legal action related to the misconduct;

 

   

The tax consequences to the affected individual; and

 

   

Any other factors the Board may deem appropriate under the circumstances.

Under the Clawback Policy, we can require reimbursement or forfeiture of all or a portion of any bonus, incentive payment, equity-based award (including performance shares, restricted stock or restricted stock units and outstanding stock options) or other compensation to the fullest extent permitted by law. Reimbursement or forfeiture may include compensation paid or awarded during the period covered by the restatement and applies to compensation awarded in periods occurring subsequent to the adoption of the Clawback Policy.

We believe our Clawback Policy is sufficiently broad to reduce the potential risk that an executive officer would intentionally misstate results in order to benefit under an incentive program and provides a right of recovery in the event that an executive officer took actions that, in hindsight, should not have been rewarded. In addition, appropriate language regarding the policy has been included in applicable documents and award agreements and our executive officers are required to acknowledge in writing that compensation we have awarded to them may be subject to reimbursement, clawback or forfeiture pursuant to the terms of the policy and/or applicable law. Further, the equity forfeiture provisions in applicable award agreements would also apply in the event of specified detrimental activity in the absence of a restatement.

Tax Implications – Deductibility of Executive Compensation

Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”) limits our ability to deduct for tax purposes compensation in excess of $1,000,000 that is paid to certain executive officers, except that historically Section 162(m) provided an exemption for compensation paid pursuant to a plan that has been approved by our stockholders and is performance-related and non-discretionary. The Compensation Committee has in prior years reviewed and considered the deductibility of executive compensation under Section 162(m). The Tax Cuts and Jobs Act of 2017 repealed the exemption from the Section 162(m) deduction limit for performance-based compensation, effective for taxable years beginning after December 31, 2017, but provides a transition rule with respect to remuneration that is provided pursuant to a written binding contract which was in effect on November 2, 2017 and which was not materially modified after that date. As a result, subject to certain exceptions, we expect

 

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that compensation paid to our named executives in excess