DEF 14A 1 adbeproxy2021.htm DEF 14A Document
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Adobe Inc.

Notice of 2021 Annual Meeting of Stockholders
and Proxy Statement











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A Message from
Our Chairman, President and CEO

To our stockholders, customers, employees, and partners,
In 2020, our world changed forever. We experienced the largest health crisis of our generation, were reminded of the long road ahead to racial justice, and witnessed the stark impacts of climate change. While these realities persist in 2021, the new year represents an opportunity to reflect on the unity, purpose, and hope that emerged. Around the globe, people came together to help slow the spread of COVID-19. Human ingenuity and science prevailed, with vaccines and therapies developed in record time. Companies, leaders, and communities pledged their commitment to foster a more equal and diverse world for everyone. We witnessed the power of digital to connect us, enable us to speak out, and fuel every aspect of how we live, learn, work, and play.
Adobe’s mission – to Change the World Through Digital Experiences – proved to be more relevant than ever. The benefits of our innovation help millions across the globe – from the creative professional, to students, governments, small businesses, and the largest multinational enterprises –create, be productive, and develop and deliver the world’s best digital experiences.
Our resilience is rooted in an unwavering focus on our employees, groundbreaking innovation, and our purpose, which is to harness the best of Adobe to make a significant impact in the world. It is this clarity that has driven our continued growth and success, making Adobe one of the most trusted and revered brands around the globe.
A Momentous 2020
People come first, and our top priority remains the health and wellbeing of our employees. Adobe took swift action to direct teams to work from home, suspend travel, and cancel in-person events. We pledged no layoffs and undertook a companywide reprioritization exercise to ensure we were focused on the initiatives that would drive the most long-term impact. We increased the frequency of our communications, surveyed employees regularly, and rolled out new benefits and programs to meet their needs. Our employee engagement numbers have actually increased
over the last year, a testament to our strong culture and values.
To help our customers make the transformational shift to digital overnight, we provisioned 30 million students at home with Adobe Creative Cloud and provided teachers with distance learning support. We offered our web-based PDF services on Adobe.com to assist with document productivity while working from home. We implemented a rapid response program to help governments digitize critical workstreams and engage with their constituents during a pivotal time.
As a product company at our core, Adobe’s innovation engine continued to fire on all cylinders. In Adobe Creative Cloud, we delivered significant product innovation that extended our applications to multiple surfaces and broke new ground in emerging categories, while improving customer engagement. In Adobe Document Cloud, we introduced Liquid Mode, which harnesses the power of Adobe Sensei, our artificial intelligence and machine learning technology, to decipher unstructured PDFs and make them responsive on mobile devices. We delivered more capabilities for document verbs – editing, sharing, scanning, and signing – across desktop, web, mobile, and through frictionless PDF services. In Adobe Experience Cloud, we launched new capabilities in Adobe Experience Platform to expand real-time customer profiles, Intelligent Services to further the use of artificial intelligence in organizations, and Customer Journey Analytics to unify and activate cross-channel data. We closed our acquisition of Workfront, the leading work management platform for marketers, furthering our vision to establish an industry-leading marketing system of record.
As the digital experiences company, we paved the path to leadership and innovation in a digital economy. Adobe MAX, our annual creativity conference, was an around-the-clock digital event like none other, featuring some of the biggest names in creativity and garnering 21 million views. Harnessing data from trillions of transactions powered by Adobe Experience Cloud, we provided a unique, real-time assessment of the economy with the Adobe Digital Economy Index, giving companies a view of digital commerce trends to help them manage their businesses in a dynamic market.



Our leadership extends to not only what we do, but how we do it. We were a top riser on Interbrand’s Best Global Brands list for the 5th year in a row, consistently named a best place to work globally, and a leader in diversity and sustainability through the Bloomberg Equality Index, CDP Climate Change A List, and Dow Jones Sustainability Index. We earned the top spot in Fortune’s Blue Ribbon list for appearing on seven of its ten most rigorous annual rankings.
All of this culminated in another strong fiscal year for Adobe. We achieved $12.87 billion in revenue, representing 15% year-over-year growth. We surpassed $10 billion in Digital Media ARR in Q4, marking a significant milestone. We generated a massive $5.73 billion in cash flows from operations and continue to create tremendous shareholder value. Our strong financial discipline and ability to drive top and bottom-line growth at scale is unparalleled, and we are well-positioned to capture the expansive market opportunities ahead of us.
Growth Strategy
Adobe has always been relentlessly focused on looking around the corner, driving towards the next big market opportunity to solve customer challenges and anticipate their needs. Our bold ambitions, combined with world-class execution, have enabled our continuous growth for nearly four decades.
Today, every industry is experiencing a tectonic shift towards all things digital at an unprecedented pace, and Adobe is the leader in three massive, growing categories – creativity, documents, and customer experience management – all of which are at the nexus of this digital revolution. Our strategy of Unleashing Creativity, Accelerating Document Productivity, and Powering Digital Businesses is driving our success across every geography and audience.
Last year, we saw the profound ability creativity has to empower people to connect, learn, and cope. Everyone – from the individual creative using art to advocate for change, to the student submitting their next school assignment, to the creative professional designing a website – has a story to tell. Content is fueling the global economy, with new devices, channels, and modalities leading to an explosion of content creation and consumption. With Adobe Creative Cloud, we are Unleashing Creativity – giving anyone, anywhere the tools to express their creativity. We are the leader in core creative categories like photography, design, video, and illustration, and we are expanding our leadership in emerging categories like screen design and immersive media. We are building solutions for every surface and system and making the creative process more collaborative and seamless across mediums. Applications like Illustrator for iPad, Photoshop Camera, Rush, and Spark are expanding our customer universe, advancing our vision to democratize creativity.
The shift to remote work has made digital workflows even more mission-critical in powering the modern business. The paper-to-digital transformation is accelerating, and cloud and mobile are reshaping how we work, enabling greater collaboration and efficiencies across dispersed teams. With Adobe Document Cloud, we are Accelerating Document Productivity, reinventing how people view, share, and engage with documents. Our mission is to enable all document actions – what we call Acrobat verbs – to be frictionless across web and mobile, leveraging our ubiquitous PDF format. Through Adobe Sensei, our artificial intelligence and machine learning technology, we are deciphering trillions of unstructured PDFs to unlock their value. Supported with a rich set of APIs, Adobe Document Cloud provides a cloud ecosystem that is revolutionizing how applications and services are built.
Every business has become a digital business, and the imperative for customer experience management has never been more real. With Adobe Experience Cloud, we are Powering Digital Businesses of all sizes, giving them everything they need to design and deliver great customer experiences at scale. Adobe Experience Cloud is the most comprehensive set of market-leading solutions across content and commerce, customer journey management, data and insights, and work management, all powered by the Adobe Experience Platform. To further our value proposition, we are investing in artificial intelligence and machine learning, delivering next-generation applications and services on the Adobe Experience Platform, and accelerating the integration of our offerings. Re-architecting systems around the customer requires strong integration across the C-Suite. Building on our deep partnership with the CMO, we are expanding our focus to the CIO and across the C-Suite to enable exceptional experiences at every stage of the customer journey.
Ethics and Integrity
As our products become increasingly ubiquitous and we bring transformational technologies to bear, we are committed to Digital Citizenship – the responsible use of technology for the good of our customers and society – in areas such as content authenticity, artificial intelligence ethics, privacy, and security.
With the velocity of content increasing every day, digital provenance is more critical than ever. We are leading the Content Authenticity Initiative (CAI) with numerous partners in hardware, software, publishing, and social media, establishing the standard for transparency and attribution across the entire content ecosystem. Last year, we introduced the CAI attribution tool, providing an easy way for creators to securely attach information about how a piece of content was edited. We started with Photoshop and Behance and plan to expand into other Adobe Creative Cloud applications this year.



Data is fundamental to how the world connects today, and we uphold high standards of responsibility on privacy and data ethics. We have created a set of artificial intelligence principles on the tenets of responsibility, accountability, and transparency to ensure that artificial intelligence is used responsibly and does not reinforce biases that may exist in data. All new artificial intelligence features and products will be reviewed under these principles.
Adobe’s privacy-by-design approach proactively incorporates privacy and certified security controls into product development that meet regulations. We provide our enterprise customers with tools that enable them to manage their consumers’ information, and our enterprise solutions are CCPA and GDPR ready. We believe that data, when used with consumer consent, trust, and transparency, can result in hyper-personalized experiences that deliver tremendous customer value.
People Are Our Greatest Asset
None of this would be possible without our 22,000+ employees around the globe, who are rallied around our mission and strategy – to create products and experiences that inspire people, transform industries, and move the world forward. I remain incredibly proud of how our employees have navigated this time with resilience, dedication, and support for one another.
It is our belief that everyone deserves equal treatment and opportunity, and that building a diverse and inclusive workplace that is reflective of the world we live in is not only the right thing to do, but essential to ensuring that our employee base represents the broad range of customers that Adobe serves.
Our commitment to people is cemented in our long track record of progressive people-centered benefits and programs, continued investment in the growth and development of our employees around the world, and vibrant employee community networks, which amplify the diverse backgrounds among us and foster an enriched culture of belonging.
We achieved global gender pay parity in October 2018, and in September 2020, we reaffirmed that we have maintained global gender pay parity and announced that we achieved pay parity between employees from underrepresented minority (URM) groups and non-URM employees in the U.S. We have taken our efforts one step further to introduce “opportunity parity,” which examines fairness in promotions and horizontal movement across demographic groups.
Last year, together with our Black employees, we formed the “Taking Action Initiative,” our strategy to accelerate the representation, development, and success of the Black community across hiring and recruiting, growth and advancement, advocacy, community, and data transparency.
We believe that greater representation leads to a virtuous cycle of more role models, advancement, and growth – a playbook that we can scale globally. We have declared a set of aspirational goals to continue to increase global diversity; increase women in leadership positions to 30 percent globally by 2025; double U.S. underrepresented minorities in leadership positions by 2025; and double Black representation as a percentage of U.S. employees by 2025.
To help us achieve our goals, we invested in a Diversity Talent Acquisition team to recruit diverse talent and are increasing our investment in partnerships with diverse institutions to build a strong pipeline.
Looking ahead, we know that the way we work has changed forever. We believe that the future of work for Adobe will be hybrid, leveraging the best of in-person interactions to collaborate and innovate, while utilizing the flexibility that comes with working from home. We will double down on our own digital transformation, making digital tools even more central to how we work. Most importantly, continuing to foster our industry-leading culture and the growth and impact of our people will remain a top priority, regardless of how and where we work.
Purpose At Our Core
Adobe’s mission has always been to create products that empower people to change the world. Our purpose is anchored on harnessing our people, platform, creativity, and innovation to make lasting change in the areas where we can uniquely make the most impact.
Digital literacy is a fundamental skill and we want to empower every voice with the tools, skills, and platform to achieve their goals. We invest in a number of programs to propel talented people to the next stage of their careers, such as the Adobe Digital Academy, Adobe Women-in-Technology Scholarship, and The Design Circle Scholarship Initiative, all of which provide skills and mentorship, products, and resources to prepare candidates for roles in technology and design. Adobe is the first brand to create the Women at Sundance Fellowship, and we are a sponsor of the Sundance Ignite Fellowship, both of which give emerging filmmakers the opportunity to develop their craft. Our newly launched Diverse Voices platform highlights the stories of diverse creators, providing a single destination for inspiration, education, and connection.
We abide by a set of inclusive design principles to make our products more accessible. Adobe Color aids individuals with colorblindness or other visual color deficiencies. Liquid Mode, a capability in Adobe Acrobat, deciphers unstructured PDFs to make them more responsive and readable. In partnership with scientists and researchers, we launched a new effort that uses artificial intelligence, machine learning, and digital tools to give readers of all levels the ability to



customize their PDF reading experience, improving speed, accuracy, and reading comprehension.
Our commitment to sustainability extends across our products, operations, and advocacy. Adobe technology enables cloud-based software delivery, paperless workflows, and virtual collaboration, allowing our customers to create a more sustainable future. We have seen this especially pronounced during the pandemic. The U.S. Census used Adobe Experience Cloud to power the first Digital Decennial Census in 2020. Ben & Jerry’s used Adobe Creative Cloud to create 3D renderings of ice cream pints in a virtual photoshoot, eliminating expenses and emissions that come with physical photoshoots. Financial institutions have leveraged Adobe Sign to process loans and other essential operations online, reducing their carbon footprint.
We furthered our commitment to address climate change by raising our Science-Based Targets to “well-below 1.5°C” — the most ambitious designation available through the Science-Based Target Initiative process. We made significant progress on our goal to be on 100 percent renewable energy by 2035, helping to implement a green tariff in our Utah office and signing a load-matched 100 percent renewable electricity agreement for our California operations, which will commence in mid-2021. We were proud to join “Recover Better,” an initiative calling on businesses and governments to put climate action at the forefront of COVID-19 recovery efforts, as well as the LEAD on Climate 2020 initiative, which advocates for long-term solutions to climate change.
In 2020, Adobe invested over $86 million in our communities through our philanthropy, volunteer, and product donation programs. Our corporate social responsibility programs (CSR) served over 71,000 non-profits worldwide, reaching 1.6 million underserved people. 70 percent of employees participated in our CSR programs, giving their time and talents to the most pertinent issues facing our societies. As an example, one group of employees produced and distributed over 150,000 3D-printed face shields for healthcare workers. It is our employees’ creativity and compassion that is most inspiring.
Looking Ahead
Adobe has the right strategy, applied to an exceptional opportunity — we expect our total addressable market to be $147 billion in 2023 and plan to surpass $15 billion in revenue in FY21. Our proven capability to create and lead categories, expansive customer universe, industry-leading products, talented employees, and world-class financial discipline give us an unmatched competitive advantage.
Adobe’s best days are ahead of us, and I remain more optimistic than ever that human ingenuity, science, and technology will win, resulting in a brighter future for all of us.
Thank you for being on this journey with us.

Sincerely,
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Shantanu Narayen
Chairman, President & CEO
Adobe Inc.




Notice of
Annual Meeting of Stockholders

Date & TimeLocationRecord Date
Tuesday, April 20, 2021
9:00am Pacific Time
Virtual
www.virtualshareholdermeeting.com/ADBE2021
Close of business on
February 22, 2021
A list of stockholders eligible to vote at the meeting will be available for review during our regular business hours at our principal executive offices at 345 Park Avenue, San Jose, California 95110 for the ten days prior to the meeting for any purpose related to the meeting, and will be available during the entire time of the virtual meeting.
ITEMS OF BUSINESSBOARD RECOMMENDATION
1.
Elect eleven members of our Board of Directors named herein to serve for a one-year term.
FOR each director nominee
2.    
Approve the 2019 Equity Incentive Plan, as amended, to increase the available share reserve by 6,000,000 shares.
FOR
3.    
Ratify the appointment of KPMG LLP as our independent registered public accounting firm for our fiscal year ending on December 3, 2021.
FOR
4.    
Approve, on an advisory basis, the compensation of our named executive officers.
FOR
You may participate in the Annual Meeting by visiting www.virtualshareholdermeeting.com/ADBE2021. There is no physical location for the Annual Meeting. For more information about the Annual Meeting, please see page 81 of the proxy.
Your vote is important. Please vote as soon as possible. You may vote your shares using the methods below.
Vote in Advance of the MeetingVote Online During the Meeting
:
Go to proxyvote.com and enter the 16-digit control number found in your Notice of Internet Availability or proxy card.
See “Information about the Meeting, Voting, and Proxies – Participating in Our Virtual Annual Meeting” on page 82 for more information.
(
Call toll-free 1-800-690-6903.
+Sign, date and return the proxy card or voting instruction form you received by mail.
By order of the Board of Directors,
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Dana Rao
Executive Vice President, General Counsel &
Corporate Secretary
March 5, 2021
San Jose, California



Proxy Statement for the
2021 Annual Meeting of Stockholders

Table of Contents
Page
2021 Proxy Statement | i

Page
A-1
B-1


ii | Adobe Inc.

Proxy Summary

The proxy materials, which include this proxy statement, proxy card, Notice of Annual Meeting of Stockholders, and our 2020 Annual Report on Form 10-K, are being distributed and made available on or about March 5, 2021. This proxy statement contains important information for you to consider when deciding how to vote on the matters brought before the 2021 Annual Meeting.

This summary does not contain all of the information you should consider. Please read this entire proxy statement carefully before voting.
Fiscal Year 2020 Financial Highlights
REVENUEGAAP DILUTED EPSNON-GAAP DILUTED EPS*
$12.87B$10.83$10.10
15% from FY2019
81% from FY2019
28% from FY2019
OPERATING CASH FLOWGAAP OPERATING INCOMENON-GAAP OPERATING INCOME*
$5.73B↑30%↑24%
during FY2020
from FY2019from FY2019
DIGITAL MEDIA REVENUEDIGITAL EXPERIENCE REVENUESTOCK REPURCHASES
$9.23B$3.13B$3.0B
20% from FY2019
12% from FY2019
returned to stockholders in FY2020

* Annex A includes a reconciliation of non-GAAP diluted EPS and non-GAAP operating income to diluted earnings per share (“EPS”) and operating income, reported under accounting principles generally accepted in the United States (“GAAP”).
Stockholder Engagement
Adobe has a history of actively engaging with our stockholders and regularly assessing our corporate governance, executive and director compensation, and sustainability practices. Our Investor Relations team regularly meets with investors, prospective investors, and investment analysts. Meetings can include participation by our management team, and at times, our Lead Director and other members of our Board of Directors (the “Board”). Our head of Investor Relations regularly communicates topics discussed and stockholder feedback to senior management and the Board for consideration in their decision-making.

Since our 2020 Annual Meeting, we have sought meetings with stockholders that collectively hold greater than 40% of our outstanding shares as part of our stockholder engagement efforts. Topics that we discussed with stockholders during our fiscal year 2020 outreach include:

Business strategy
Financial performance
Executive & director compensation
The Content Authenticity Initiative
Human capital and talent
Diversity and Inclusion programs
Workforce & ESG disclosures
Renewable energy and sustainability
Accessibility and digital inclusion
2021 Proxy Statement | 1

Board Highlights
Director Nominees and Committee Membership
The following table sets forth the name, role, age as of March 5, 2021, tenure, and committee assignments for each of our eleven director nominees at the 2021 Annual Meeting. Each director is elected annually by our stockholders.
COMMITTEE MEMBERSHIPS(1)
NAMEROLEAGEDIRECTOR SINCEINDEPENDENT
AUDIT
EXECUTIVE COMPENSATIONNOMINATING AND GOVERNANCE
Amy BanseDirector
61
2012YesCM
Melanie BouldenDirector
48
2020YesM
Frank CalderoniLead Director
63
2012YesC
James DaleyDirector
79
2001YesM
Laura DesmondDirector
56
2012YesM
Shantanu NarayenChairman
57
2007No
Kathleen ObergDirector
60
2019YesCM
Dheeraj PandeyDirector
45
2019YesM
David RicksDirector
53
2018YesM
Daniel RosensweigDirector
59
2009YesM
John WarnockDirector
80
1983Yes
CChairMMember
(1)    If director nominees are elected by stockholders, committee composition immediately following the 2021 Annual Meeting will be unchanged.
Corporate Governance Highlights
Strong board independence (10 of 11 director nominees are independent)
Independent lead director
All committee members are independent
All directors stand for election annually
Majority vote standard for uncontested director elections
Bylaws provide for proxy access for stockholders
Single class of stock with equal voting rights
Robust stock ownership requirements for executive officers and directors
Stockholder right to call a special meeting
All current Audit Committee members are audit committee financial experts under SEC rules
Simple majority vote standard for charter/bylaw amendments
Regular board and committee evaluations
2 | Adobe Inc.

Age, Tenure and Board Diversity
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*Excluding co-founder John Warnock, who has served on the Board since the Company’s inception, the remaining ten nominees have an average tenure of 8.1 years.
**Underrepresented communities as defined in California AB 979
Director Attributes
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EXECUTIVE LEADERSHIPGLOBAL LEADERSHIPTECHNOLOGIST
11 director nominees
11 director nominees
3 director nominees
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BUSINESS DEVELOPMENT & STRATEGYSALES, MARKETING & BRAND MANAGEMENTFINANCE OR ACCOUNTING
11 director nominees
4 director nominees
10 director nominees
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LEGAL OR REGULATORYOPERATIONSPUBLIC COMPANY BOARD SERVICE
4 director nominees
11 director nominees
8 director nominees
2021 Proxy Statement | 3

Executive Compensation Highlights
Compensation Practices
What we doWhat we don’t do
ü
Pay for Performance.
Our executives’ total compensation is designed to pay for performance and is comprised of elements that address both short-term and long-term financial performance.
û
Our Insider Trading Policy, which applies to all employees, officers, and directors, prohibits transactions involving pledging, hedging, or short sales of Adobe equity.
ü
Independent Compensation Consultant.
The Compensation Committee engages its own independent compensation consultant to advise on executive and non-employee director compensation matters.
ûWe do not provide golden parachute excise tax gross-up payments.
ü
Annual Compensation Peer Group Review.
The Compensation Committee reviews the composition of our compensation peer group annually and makes adjustments to the composition of that peer group, if deemed appropriate.
ûWe do not provide defined benefit pension plans, supplemental executive retirement plans, or retiree health benefits.
ü
Annual Say-on-Pay Vote.
We conduct an annual advisory vote on the compensation of our NEOs. At our 2020 Annual Meeting, more than 93% of the votes cast approved the 2019 compensation of our NEOs.
ûOur equity plans do not include an evergreen feature that would automatically replenish the shares available for issuance.
ü
Clawback policy.
We have a clawback policy for performance-based incentive compensation of our executive officers.
ü
Robust Stock Ownership Guidelines.
We have robust stock ownership requirements for our directors and officers at the Senior Vice President level and above.

Total Direct Compensation

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4 | Adobe Inc.


Board of Directors &
Corporate Governance

Our Board of Directors
Our business is managed under the direction of our Board, which is currently composed of eleven members. Adobe’s stockholders elect our Board members annually, and, with the exception of Melanie Boulden, who was appointed to the Board on October 2, 2020, all of our current directors were elected by our stockholders, and all directors are serving a term that expires at the 2021 Annual Meeting. See the “Proxy Summary—Board Highlights” section for information on the composition of our Board.
The following table highlights the number of our director nominees who share certain categories of attributes and experiences that uniquely qualify them to serve on our Board. We believe the diversity of experiences and qualifications represented by our directors is critical to Adobe’s success. We have narrowly tailored and defined these categories, although inclusion in certain categories will in many cases provide experience and expertise covered by other categories. For example, directors with CEO experience will also have gained significant exposure to operational and regulatory issues.
Attributes and Experience of Director Nominees
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11
Executive LeadershipDirectors who have served as a founder, CEO, or CEO-equivalent, senior executive, or business unit leader of a company with a deep understanding of company offerings and industry
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11
Global LeadershipDirectors with leadership experience in a global company overseeing non-U.S. operations, diverse economic landscapes, and working with various cultures
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3
TechnologistDirectors with extensive experience in software products, services, engineering, or development, computer science, information technology, cyber-security, or technology research and development
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11
Business Development & StrategyDirectors with expertise in strategic planning, mergers and acquisitions, growth strategies, or business expansion
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4
Sales, Marketing & Brand ManagementDirectors with specific and extensive career experience focusing on sales management, marketing campaign management, marketing/advertising products and services, or public relations
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10
Finance or AccountingDirectors with a deep understanding of finance, accounting principles and methodologies, financial reporting, financial management, capital markets, financial statements, audit processes and procedures, or internal financial controls
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4
Legal or RegulatoryDirectors with governmental policy, legal knowledge, or experience with compliance and regulatory issues within a public company or a regulatory body, including any individual who has a CPA, JD, or significant CFO experience
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11
OperationsDirectors having expertise in business operations management, supply chain management, integration, or distribution
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8
Public Company Board Service / GovernanceDirectors who currently serve, or have served, on other public company boards
2021 Proxy Statement | 5

Considerations in Evaluating Director Nominees
    The Board identified the following general criteria for consideration when evaluating board member nominees, and composition of the Board:

Exercises logical, thorough, objective, sound and rational judgment when representing the best interests of all Adobe stockholders
Possesses experience and expertise relevant to expanding the breadth of the Board’s collective knowledge, skill set and attributes
Proves and reinforces board member’s commitment to achieving Adobe’s long-term objectives by prioritizing and investing the attention necessary to fulfill Board membership-related duties, attendance obligations and responsibilities
Maintains and increases diversity in professional experience, personal experience, expertise, culture, race, ethnicity and gender among the Board members
Understands elements relevant to the success of a publicly-traded company, including the importance of best practices in corporate governance
Demonstrates integrity and ethics in such candidate’s personal and professional life
6 | Adobe Inc.


Director Nominees
for Election for a One-Year Term Expiring in 2022


Amy Banse
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Age: 61
Director since 2012.

Other Public Company Boards:
The Clorox Company
Lennar Corporation
Committees: Executive Compensation (chair), Nominating and Governance
Biography:
Ms. Banse currently serves as Senior Advisor to Comcast Corporation, a global media and technology company where she previously held the positions of Executive Vice President, Comcast Corporation, and Managing Director and Head of Funds, Comcast Ventures. Prior to that role, Ms. Banse was President of Comcast Interactive Media (CIM), a division of Comcast responsible for developing Comcast's online strategy and operating Comcast's digital properties, including Fandango, Xfinity.com and Xfinitytv.com. She joined Comcast in 1991 and spent the early part of her career at Comcast overseeing the development of Comcast's cable network portfolio. She received a B.A. from Harvard and a J.D. from Temple University School of Law.
As the former Managing Director and Head of Funds for Comcast Ventures and Executive Vice President, Comcast Corporation, as well as her prior executive positions, including President of CIM, Ms. Banse has extensive executive leadership experience and extensive knowledge of financial and strategic issues. She also brings to the Board a deep expertise in global media and technology organizations in online business.

Melanie Boulden
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Age: 48
Director since 2020.
Committees: Executive Compensation
Biography:
Ms. Boulden currently serves as Chief Marketing Officer of Coca-Cola North America (CCNA) and provides oversight to its multibillion dollar portfolio that includes brands like Coca-Cola, Sprite, Smartwater and Honest Tea. Prior to her role as Chief Marketing Officer of CCNA, Ms. Boulden was President of the Stills Business Unit and led CCNA’s water, active hydration, tea and coffee businesses. Before joining Coca-Cola in August 2019, Ms. Boulden was the global head of Marketing and Brand Management at Reebok, where she reignited Reebok’s connection to pop culture, entertainment, fitness and fashion. She also served as senior vice president of Global Marketing at Crayola and spent several years at Kraft Foods and Henkel Consumer Goods in various marketing and general management positions. She has been recognized as one of Ad Age’s 2019 U.S. Women to Watch. Ms. Boulden holds a B.S. from Iowa State University and an M.B.A. from The University of Iowa.
With her current role as Chief Marketing Officer of CCNA, together with her previous roles crafting some of the world’s most well-known brands, Ms. Boulden brings to the Board extensive experience and deep expertise in global marketing and brand management.

2021 Proxy Statement | 7

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Frank Calderoni Lead Director
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Age: 63
Director since 2012.
Lead Director since 2020.

Other Public Company Boards:
Anaplan, Inc.
Palo Alto Networks, Inc. (2016 to 2019)
Committees: Nominating and Governance (chair)
Biography:
Mr. Calderoni currently serves as the President and Chief Executive Officer of Anaplan, a planning and performance management platform provider. Prior to joining Anaplan in January 2017, he served as Executive Vice President, Operations and Chief Financial Officer at Red Hat from June 2015 to December 2016. Until June 2015, he was an Executive Advisor at Cisco, a designer, manufacturer and seller of IP-based networking and other products related to the communications and information technology industry. From 2008 to January 2015, Mr. Calderoni served as Executive Vice President and Chief Financial Officer at Cisco, managing the company's financial strategy and operations. He joined Cisco in 2004 from QLogic Corporation, a storage networking company where he was Senior Vice President and Chief Financial Officer. Prior to that, he was Senior Vice President, Finance and Administration and Chief Financial Officer for SanDisk Corporation, a flash data storage company. Before joining SanDisk, Mr. Calderoni spent 21 years at IBM, a global services, software and systems company, where he became Vice President and held controller responsibilities for several divisions within the company. Mr. Calderoni holds a B.S. in Accounting and Finance from Fordham University and an M.B.A. in Finance from Pace University.
As a result of his position at Anaplan, as well as his past service as chief financial officer of publicly traded global technology companies, Mr. Calderoni brings to the Board abundant financial expertise that includes extensive knowledge of the complex financial and operational issues facing large global companies, and a deep understanding of accounting principles and financial reporting rules and regulations. He provides the Board and Audit Committee with significant insight into the preparation of financial statements and knowledge of audit procedures. Through his senior executive positions, Mr. Calderoni has demonstrated his global leadership and business acumen.
James Daley
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Age: 79
Director since 2001.

Other Public Company Boards:
The Guardian Life Insurance Company of America (1998 to 2016)
Committees: Audit
Biography:
Mr. Daley has been an independent consultant since his retirement in July 2003 from Electronic Data Systems Corporation (EDS), an information technology service company. Mr. Daley served as Executive Vice President and Chief Financial Officer of EDS from March 1999 to February 2003, and as its Executive Vice President of Client Solutions, Global Sales and Marketing from February 2003 to July 2003. From 1963 until his retirement in 1998, Mr. Daley was with Price Waterhouse, where he served as Co-Chairman-Operations and Vice-Chairman-International from 1988 to 1998. From 1985 to 1997 he was a member of the U.S. firm's Policy Board and from 1990 to 1998 a member of the firm's World Board. Mr. Daley holds a B.B.A. from Ohio University where he served for over twenty years as a Trustee of The Ohio University Foundation, including Chairing its Board of Trustees from 1997 to 2002.
With more than 35 years of service with the international accounting firm Price Waterhouse, as well as his past service as the Chief Financial Officer of a publicly traded global technology company, and his board level experience with Price Waterhouse, The Guardian Life Insurance Company of America and The Ohio University Foundation, Mr. Daley brings to the Board extensive expertise related to the business, operational and financial issues facing large global technology corporations, as well as a comprehensive understanding of international business, regulatory compliance and corporate governance matters.
8 | Adobe Inc.

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Laura Desmond
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Age: 56
Director since 2012.

Other Public Company Boards:
Capgemini SE (2019 to 2020)
Committees: Executive Compensation
Biography:
Ms. Desmond is currently Founder and CEO of Eagle Vista Partners, a strategic advisory and investment firm focused on marketing and digital technology, and an Operating Partner in the Media & Technology Practice at Providence Equity Partners, a private equity investment firm. Prior to this, she was the Chief Revenue Officer of Publicis Groupe, a group of global marketing, communication and business transformation companies from December 2016 to December 2017. From 2008 to December 2016 she was the Global Chief Executive Officer of Starcom MediaVest Group (SMG), a global marketing and media services company which is part of the Publicis Groupe. Prior to her appointment as Global Chief Executive Officer in 2008, Ms. Desmond was Chief Executive Officer of SMG - The Americas from 2007 to 2008 where she managed a network spanning the United States, Canada and Latin America. She was Chief Executive Officer of MediaVest, based in New York, from 2003 to 2007, and from 2000 to 2002 she was Chief Executive Officer of SMG's Latin America group. She holds a B.B.A. in Marketing from the University of Iowa.
With her extensive experience as a strategist, consultant and investor working with global marketers, media companies and brands, including serving as Chief Revenue Officer of Publicis Groupe and Global Chief Executive Officer of SMG, Ms. Desmond brings to the Board a deep expertise in global media and marketing technology organizations, leadership capabilities and business acumen. In addition, her present and past service on other boards gives her valuable knowledge and perspective. As an expert in the marketing space, Ms. Desmond speaks frequently with Adobe’s management outside of scheduled board meetings to provide specific insight regarding Adobe’s Digital Experience business.

Shantanu Narayen Chairman
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Age: 57
Director since 2007.
Chairman since 2017.

Other Public Company Boards:
Pfizer, Inc. (lead independent director)
Committees: None
Biography:
Mr. Narayen currently serves as our President, Chief Executive Officer, and Chairman of the Board. He joined Adobe in January 1998 as Vice President and General Manager of our engineering technology group. In January 1999, he was promoted to Senior Vice President, Worldwide Products, and in March 2001 he was promoted to Executive Vice President, Worldwide Product Marketing and Development. In January 2005, Mr. Narayen was promoted to President and Chief Operating Officer, and effective December 2007, he was appointed our Chief Executive Officer and joined our Board. In January 2017, he was named our Chairman of the Board. Mr. Narayen holds a B.S. in Electronics Engineering from Osmania University in India, a M.S. in Computer Science from Bowling Green State University and an M.B.A. from the Haas School of Business, University of California, Berkeley.
As our President, Chief Executive Officer, Chairman of the Board and as an Adobe employee for more than 20 years, Mr. Narayen brings to the Board extensive leadership and industry experience, including a deep knowledge and understanding of our business, operations and employees, the opportunities and risks faced by Adobe, and management’s current and future strategy and plans. In addition, his service on other boards gives him a strong understanding of his role as a director and a broad perspective on key industry issues and corporate governance matters.
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Kathleen Oberg
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Age: 60
Director since 2019.

Committees: Audit (chair), Nominating and Governance
Biography:
Ms. Oberg currently serves as Executive Vice President and Chief Financial Officer for Marriott International, Inc. Beginning in 2013 and until January 2016, Ms. Oberg served as Chief Financial Officer for Ritz-Carlton. From 2008 until she joined Ritz-Carlton in 2013, Ms. Oberg served as Marriott’s Senior Vice President, Corporate Development Finance and from 2006 to 2008, she served as Marriott’s Senior Vice President, International Project Finance and Asset Management for Europe, the Middle East and Africa, and as the senior finance executive for the region. Ms. Oberg’s career with Marriott began in 1999 where she served as a member of its Investor Relations group. Prior to initially joining Marriott in 1999, Ms. Oberg held various financial leadership positions with Sodexo, Sallie Mae, Goldman Sachs and Chase Manhattan Bank. Ms. Oberg holds a B.S. in Commerce with concentrations in Finance/Management Information Systems from the University of Virginia, McIntire School of Commerce and an M.B.A from the Stanford University Graduate School of Business.
As a result of her position at Marriott and her past service in financial leadership positions, Ms. Oberg brings to the Board financial expertise, including an in-depth knowledge of financial reporting rules and regulations, and accounting principles. Her deep understanding of the multifaceted financial and operational issues affecting large global organizations and leadership experience with development projects and merger and acquisition opportunities brings the Board and Audit Committee valuable insight into preparing long-range plans, annual budgets, and capital allocation strategy.


Dheeraj Pandey
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Age: 45
Director since 2019.

Other Public Company Boards:
Nutanix. Inc. (2009 to 2020)
Committees: Audit
Biography:
Mr. Pandey is the Chairman and CEO of DevRev, Inc., a SaaS company that is focused on using AI and design to automate software and customer engineering workflows. Previously, he co-founded Nutanix in 2009 and served as its Chief Executive Officer and as the Chairman of its board of directors until December 2020. Mr. Pandey also served as the President of Nutanix from September 2009 until February 2016. Between September 2007 and September 2009, he served as VP (and Director) of Engineering at Teradata Corporation (fka Aster Data Systems), a data warehousing company. Prior to Teradata, Mr. Pandey served in software engineering roles at Oracle Corporation, Zambeel, Inc., and Trilogy Software, Inc. Mr. Pandey holds a B.Tech. in Computer Science from the Indian Institute of Technology, Kanpur, and a M.S. in Computer Science from the University of Texas at Austin. He was a Graduate Fellow of Computer Science in the University of Texas at Austin Ph.D. program.
With his experience in the technology industry as a global executive leader and technologist, including co-founding and serving as CEO and Chairman of DevRev and Nutanix and as a software engineer at various companies over the course of nearly 20 years, Mr. Pandey brings to the Board engineering expertise, financial acumen, an in-depth understanding of the technology landscape, and valuable insight on growing a company from a start-up to a publicly traded company.

10 | Adobe Inc.

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David Ricks
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Age: 53
Director since 2018.

Other Public Company Boards:
Eli Lilly and Company (Chair)
Elanco Animal Health, Inc. (2018 to 2019)
Committees: Executive Compensation
Biography:
Mr. Ricks currently serves as Chief Executive Officer of Eli Lilly and Company and became Chairman of the Eli Lilly and Company board of directors in June 2017. Prior to January 2017, Mr. Ricks served as President of Lilly Bio-Medicines. From 2009 to 2012, he served as President of Lilly USA, the Eli Lilly and Company’s largest affiliate. Mr. Ricks served as President and General Manager of Lilly China, operating in one of the world’s fastest-growing emerging markets, from 2008 to 2009. He was general manager of Lilly Canada from 2005 to 2008, after roles as Director of Pharmaceutical Marketing and National Sales Director in Canada. Mr. Ricks joined Eli Lilly and Company in 1996 as a Business Development Associate and held several management roles in U.S. marketing and sales before moving to Lilly Canada. Mr. Ricks earned a B.S. from Purdue University in 1990 and an M.B.A. from Indiana University in 1996.
As Chairman and Chief Executive Officer of a large, innovation-focused, global company, Mr. Ricks brings to the Board executive leadership, marketing, sales and financial expertise, business acumen and relevant worldwide operational insight.


Daniel Rosensweig
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Age: 59
Director since 2009.

Other Public Company Boards:
Chegg, Inc.
Time Inc. (2017 to 2018)
Committees: Audit
Biography:
Mr. Rosensweig is currently President, Chief Executive Officer, and Chairman of the board of directors of Chegg.com, an online textbook rental company. Prior to joining Chegg.com in February 2010, Mr. Rosensweig served as President and Chief Executive Officer of RedOctane, a business unit of Activision Publishing, a developer, publisher and distributor of interactive entertainment and leisure products. Prior to joining RedOctane in March 2009, Mr. Rosensweig was an Operating Principal at the Quadrangle Group, a private investment firm. Prior to joining the Quadrangle Group in August 2007, Mr. Rosensweig served as Chief Operating Officer of Yahoo!, which he joined in April 2002. Prior to joining Yahoo!, Mr. Rosensweig was President of CNET Networks, Inc., an interactive media company, which he joined in October 2000. Mr. Rosensweig served for 18 years with Ziff-Davis, an integrated media and marketing services company, including roles as President and Chief Executive Officer of its subsidiary ZDNet, from 1997 until 2000 when ZDNet was acquired by CNET. Mr. Rosensweig holds a B.A. in Political Science from Hobart College.
As a result of his current executive position at Chegg.com, as well as his former positions as a senior executive at global media and technology organizations, Mr. Rosensweig provides the Board with extensive and relevant executive leadership, worldwide operations and technology industry experience.
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John Warnock Co-Founder
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Age: 80
Director since 1983.

Other Public Company Boards:
Salon Media Group, Inc. (2001 to 2017)
Committees: None
Biography:
Dr. Warnock was a founder of Adobe and was our Chairman of the Board from April 1989 to January 2017. From September 1997 to January 2017, he shared the position of Chairman with Dr. Geschke. Dr. Warnock served as our Chief Executive Officer from 1982 until December 2000. From December 2000 until his retirement in March 2001, Dr. Warnock served as our Chief Technical Officer. Dr. Warnock holds a Ph.D. in Electrical Engineering, an M.S. in Mathematics, and a B.S. in Mathematics and Philosophy from the University of Utah.
As a co-founder of Adobe and its former Chief Executive Officer, Chief Technical Officer, and Chairman of the Board, Dr. Warnock has experience growing Adobe from a start-up to a large publicly traded company. His nearly 20 years of executive and technological leadership at Adobe provide the Board with significant leadership, operations and technology experience, as well as important perspectives on innovation, management development, and global challenges and opportunities. As former Co-Chairman of the Board and Chairman of the board of Salon, Dr. Warnock has a strong understanding of his role as a director and a broad perspective on key industry issues and corporate governance matters.

Independence of Directors
As required by the Nasdaq listing standards, a majority of the members of our Board must qualify as “independent,” as affirmatively determined by our Board. Our Board consults with our legal counsel to ensure that its determinations are consistent with all relevant securities and other laws and regulations regarding the definition of “independent,” including those set forth in the applicable Nasdaq listing standards. In addition, in making its determination, the Board considers any arms-length transactions made in the ordinary course between Adobe and certain related entities, for instance the purchase from Adobe of software products and services by companies of which a director is an executive officer.
After review of all relevant transactions and relationships between each director, any of their family members, Adobe, our executive officers, and our independent registered public accounting firm, the Board has affirmatively determined that a majority of our Board is comprised of independent directors. Our current independent directors are: Ms. Banse, Ms. Boulden, Mr. Calderoni, Mr. Daley, Ms. Desmond, Ms. Oberg, Mr. Pandey, Mr. Ricks, Mr. Rosensweig, and Dr. Warnock. During his term of service in fiscal year 2020, Dr. Geschke was also determined to be an independent director.
Board Leadership Structure
    Each year, our Board evaluates whether its leadership structure is appropriate to effectively address the specific needs of our business and the long-term interests of our stockholders. Given the dynamic and competitive environment in which Adobe operates, the Board believes that Adobe and our stockholders are best served by a Chairman who has broad and deep knowledge of Adobe’s business operations and the competitive landscape, the ability to identify strategic issues, and the vision to create sustainable long-term value for stockholders. Based on these considerations, the Board has determined that, at this time, our Chief Executive Officer, Shantanu Narayen, is the director best qualified to serve in the role of Chairman. The Board believes that Mr. Narayen’s combined role enables decisive leadership, ensures clear accountability and enhances the Board’s ability to focus its meetings on the issues most critical to Adobe’s success, as well as Adobe’s ability to communicate its message and strategy clearly and consistently to its stockholders, employees, and customers.
To maintain an appropriate level of independent checks and balances, our Corporate Governance Guidelines provide that if the Chairman of the Board and the Chief Executive Officer are the same person, the independent members of
12 | Adobe Inc.

the Board will annually select an independent director to serve in a lead capacity, who we refer to as our Lead Director. Our Board believes that there are advantages to having a Lead Director for matters such as communications and relations among our Board, the Chief Executive Officer, and other members of senior management and in assisting our Board in reaching consensus on particular strategies and policies. The independent members of our Board have selected Frank Calderoni to serve as Lead Director.
Our Lead Director coordinates the activities of the other independent directors and has the following additional responsibilities, as outlined in a Lead Director Charter adopted by the Board and available on our website at http://www.adobe.com/investor-relations/governance.html:
presiding at all meetings of the Board at which the Chairman is not present, including executive sessions of the independent directors;
working to optimize Board performance through regular feedback that ensures that diverse viewpoints of all directors are heard, and creating a climate of constructive candor in which frank and thoughtful discussion occurs;
meeting with the Chairman and Chief Executive Officer to discuss Board agendas, materials, and the schedule of meetings;
calling meetings of the independent directors, as needed;
retain outside advisors and consultants who report directly to the Board on board-wide issues, as needed;
providing feedback to directors in connection with the periodic Board evaluation process;
administering, with the Chair of the Executive Compensation Committee, the Board’s evaluation of the performance of the Chairman and Chief Executive Officer; and
making himself available for communication with Adobe’s significant stockholders.
Our Board believes that stockholders are best served by the Board’s current leadership structure because it provides Adobe with the benefits of combining the leadership role of Chairman and Chief Executive Officer, while at the same time featuring a strong and empowered independent Lead Director who provides an effective independent voice and further enhances the contributions of our independent directors.
Fiscal Year 2020 Board and Committee Meetings
During fiscal year 2020, our Board held six meetings, and its three standing committees — Audit Committee, Executive Compensation Committee, and Nominating and Governance Committee — collectively held 20 meetings. Each director attended at least 75% of the meetings of the Board and the committees on which such director served in fiscal year 2020. Members of our Board are encouraged to attend our annual meetings of stockholders. All ten of the Board members then serving on our Board attended our 2020 Annual Meeting of Stockholders (“2020 Annual Meeting”).
The following table sets forth the number of meetings held by our Board and the committees during fiscal year 2020:
NameBoardAuditExecutive Compensation
Nominating and
Governance
Number of meetings held in fiscal year 2020
6884
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Committees of the Board
Audit Committee
The Audit Committee’s role includes assisting the Board in fulfilling its responsibilities related to the oversight of our financial, accounting, and reporting processes; our system of internal accounting and financial controls; our enterprise risk management program; and our compliance with related legal, regulatory, and ethical requirements. The Audit Committee’s responsibilities include:
•    the appointment, compensation, engagement, evaluation, retention, termination, and services of our independent registered public accounting firm, including conducting a review of its independence;
•    reviewing and approving the planned scope of our annual audit;
•    overseeing our independent registered public accounting firm’s audit work;
•    reviewing and pre-approving any audit and non-audit services that may be performed by our independent registered public accounting firm;
•    reviewing with management and our independent registered public accounting firm the adequacy of our internal financial and disclosure controls;
•    reviewing our critical accounting policies, critical audit matters and the application of accounting principles;
•    monitoring the rotation of partners of our independent registered public accounting firm on our audit engagement team as required by regulation;
•    reviewing our policies and practices with respect to swaps transactions;
•    overseeing Adobe’s worldwide investment policy;
•    overseeing the performance of our internal audit function;
•    establishing procedures, as required under applicable regulation, for the receipt, retention, and treatment of complaints received by us regarding accounting, internal accounting controls, or auditing matters, and the confidential, anonymous submission by employees of concerns regarding questionable accounting or auditing matters;
•    reviewing relevant elements of Adobe’s enterprise risk management program, including reviewing and discussing with management the adequacy and effectiveness of the company’s information and technology security policies and the internal controls regarding information and technology security, cybersecurity, and privacy; and
•    reviewing our annual audited financial statements and quarterly financial statements with management and our independent registered public accounting firm.
The Audit Committee has the authority to obtain independent advice and assistance from internal or external legal, accounting and other advisors, at Adobe’s expense. See “Report of the Audit Committee” contained in this proxy statement.
Each member of the Audit Committee meets the independence criteria prescribed by applicable regulations and the rules of the U.S. Securities and Exchange Commission (the “SEC”) for audit committee membership and is an “independent director” within the meaning of applicable Nasdaq listing standards. Each Audit Committee member meets Nasdaq’s financial sophistication requirements, and the Board has further determined that each Audit Committee member is an “audit committee financial expert” as such term is defined in Item 407(d) of Regulation S-K promulgated by the SEC. The Audit Committee acts pursuant to a written charter, which complies with the applicable provisions of the Sarbanes-Oxley Act of 2002 and related rules of the SEC and Nasdaq, a copy of which can be found on our website at http://www.adobe.com/investor-relations/governance.html.
14 | Adobe Inc.

Nominating and Governance Committee
The Nominating and Governance Committee’s primary purpose is to evaluate candidates for membership on our Board and make recommendations to our Board regarding corporate governance matters and candidates for director. The committee also:
•    makes recommendations with respect to the composition and diversity of our Board and its committees;
•    reviews and makes recommendations regarding the functioning of our Board as an entity;
•    recommends corporate governance principles applicable to Adobe;
•    manages periodic review, discussion, and evaluation of the performance of our Board, its committees, and its members;
•    assesses the independence of our directors;
•    reviews and approves or disapproves any related-person transaction as defined under Item 404 of Regulation S-K, after examining each such transaction for potential conflicts of interest and other improprieties; and
•    reviews the board memberships of other entities held by members of the Board and approves such memberships for our executive officers.
If requested by the Board, the Nominating and Governance Committee also may assist our Board in reviewing and assessing management development and succession planning for our executive officers. The Nominating and Governance Committee has the authority to obtain independent advice and assistance from internal or external legal, accounting, and other advisors, at Adobe’s expense. The members of our Nominating and Governance Committee are all independent directors within the meaning of applicable Nasdaq listing standards. The Nominating and Governance Committee operates pursuant to a written charter, a copy of which can be found on our website at http://www.adobe.com/investor-relations/governance.html.
In carrying out its function to nominate candidates for election to our Board, the Nominating and Governance Committee considers the criteria, attributes, and experience discussed above in “Our Board of Directors.” In reviewing potential candidates, the Nominating and Governance Committee will also consider all relationships between any proposed nominee and any of Adobe’s stockholders, competitors, customers, suppliers, or other persons with a relationship to Adobe. In addition, the Nominating and Governance Committee believes it is appropriate for at least one member of our Audit Committee to meet the criteria for an “audit committee financial expert” as defined by SEC rules, that each member of our Executive Compensation Committee be a “non-employee director” within the meaning of Rule 16b-3 under the Securities Exchange Act of 1934 (the “Exchange Act”), and that a majority of the members of our Board meet the definition of “independent director” within the meaning of applicable Nasdaq listing standards.
The Nominating and Governance Committee, from time to time, retains for a fee one or more third-party search firms to identify suitable candidates.
The Nominating and Governance Committee considers stockholder recommendations for candidates for the Board. The name of any recommended candidate for director, together with a brief biographical sketch, a document indicating the candidate’s willingness to serve if elected, and evidence of the recommending stockholder’s ownership of company stock must be sent to the attention of our Corporate Secretary. In August 2016, the Board amended our Bylaws to implement proxy access. Under Article III, Section 6 of our Bylaws, a stockholder (or group of up to twenty stockholders) owning at least three percent of Adobe’s outstanding shares of common stock continuously for at least three years may nominate and include in our annual meeting proxy materials director nominees constituting up to the greater of two directors or twenty percent of the Board, provided the stockholders and nominees satisfy the requirements specified in our Bylaws. In addition to proxy access nominations, any of our stockholders may nominate one or more persons for election as a director at our annual meeting of stockholders. In either case, a stockholder who wishes to formally nominate a candidate must comply with the notice, information and consent provisions contained in our Bylaws, including that the notice must include information required pursuant to Section 14 of the Exchange Act. Our Bylaws specify additional requirements if stockholders wish to nominate directors at special meetings of stockholders. The Nominating and Governance Committee will consider all candidates
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identified through the processes described above, and will evaluate each candidate, including incumbents, based on the same criteria.
Executive Compensation Committee
The Executive Compensation Committee sets and administers the policies that govern, and reviews and approves, all compensation of our executive officers, including cash, equity, and other compensation programs. The Executive Compensation Committee is also responsible for making recommendations to the Board concerning Board and committee compensation, as well as overseeing matters related to human capital management, including the Company's diversity and inclusion programs. The Executive Compensation Committee may also review and approve equity-based compensation grants to our non-executive officer employees and consultants; however, restricted stock unit grants to our non-executive officer employees are generally approved by a Management Committee for Employee Equity Awards appointed by the Board and currently consisting of our Chief Executive Officer and Chief People Officer & Executive Vice President, Employee Experience within parameters established by the Executive Compensation Committee. See “Granting Guidelines for Equity Compensation” and “Compensation-Setting Governance and Process” under “Compensation Discussion and Analysis” for additional information. The Chief Executive Officer is also authorized, in his capacity as a member of the Board, to approve the assumption of outstanding equity awards in acquisitions, new hire and retention restricted stock unit grants to non-executive officer employees, and restricted stock unit grants to consultants. In addition, the Executive Compensation Committee reviews our stock ownership guidelines for directors and the executive leadership team, which are described below in “Compensation Discussion and Analysis—Equity-Related Policies—Stock Ownership Guidelines.”
The Executive Compensation Committee is also responsible for oversight of our overall compensation plans and benefit programs, as well as the approval of all employment, severance, and change of control agreements and plans applicable to our executive officers. In connection with this oversight, the Executive Compensation Committee reviews and approves annual performance objectives and goals relevant to our executive officers. The Executive Compensation Committee oversees all matters related to stockholder approval of executive compensation, including the advisory vote on named executive officer compensation, and evaluates the risk-taking incentives and risk management of our compensation policies and practices. The Executive Compensation Committee has the authority to obtain independent advice and assistance from internal or external legal, accounting, and other advisors, at Adobe’s expense. The Executive Compensation Committee assesses the independence and any potential conflicts of interest of compensation advisors in accordance with applicable law and Nasdaq listing standards. The members of the Executive Compensation Committee are all independent directors within the meaning of applicable Nasdaq listing standards, and all of the members are “non-employee directors” within the meaning of Rule 16b-3 under the Exchange Act. The Executive Compensation Committee acts pursuant to a written charter, a copy of which can be found on our website at http://www.adobe.com/investor-relations/governance.html.
Compensation Committee Interlocks and Insider Participation
There are no members of our Executive Compensation Committee who were officers or employees of Adobe or any of our subsidiaries during fiscal year 2020. No members were formerly officers of Adobe or had any relationship otherwise requiring disclosure hereunder. During fiscal year 2020, no interlocking relationships existed between any of our executive officers or members of our Board or Executive Compensation Committee, on the one hand, and the executive officers or members of the board of directors or compensation committee of any other entity, on the other hand.
Transactions with Related Persons
Review, Approval, or Ratification of Transactions with Related Persons
Pursuant to its written charter, the Nominating and Governance Committee considers and approves or disapproves any related person transaction as defined under Item 404 of Regulation S-K, after examining each such transaction for potential conflicts of interest and other improprieties. The Nominating and Governance Committee has not adopted any specific written procedures for conducting such reviews and considers each transaction in light of the specific facts and circumstances presented.
16 | Adobe Inc.

Transactions with Related Persons
Since the beginning of fiscal year 2020, there have not been any transactions, nor are there any currently proposed transactions, in which Adobe was or is to be a participant, where the amount involved exceeded $120,000, and in which any related person had or will have a direct or indirect material interest. As is the case with most multinational corporations, from time to time in the ordinary course of business we engage in arms-length transactions with companies in which members of the Board or our executive team have professional relationships.
Communications with the Board
Any stockholder who desires to contact our Board, or specific members of our Board, may do so electronically by sending an email to the following address: adobeboard@adobe.com. Alternatively, a stockholder may contact our Board, or specific members of our Board, by writing to:
Stockholder Communications
Adobe Inc.
345 Park Avenue
San Jose, California 95110, USA
All such communications will be initially received and processed by the office of our Corporate Secretary. Accounting, audit, internal accounting controls and other financial matters will be referred to the Chair of the Audit Committee. Other matters will be referred to the Board, the non-employee directors or individual directors as appropriate.
Corporate Governance Guidelines & Code of Business Conduct and Ethics
Corporate Governance Guidelines
We believe in sound corporate governance practices and have adopted formal Corporate Governance Guidelines to enhance our effectiveness. Our Board adopted these Corporate Governance Guidelines in order to ensure that it has the necessary practices in place to review and evaluate our business operations as needed and to make decisions that are independent of our management. The Corporate Governance Guidelines set forth the practices our Board follows with respect to Board and committee composition and selection, Board meetings, Chief Executive Officer performance evaluation, and management development and succession planning for senior management, including the Chief Executive Officer position. A copy of our Corporate Governance Guidelines is available on our website at http://www.adobe.com/investor-relations/governance.html.
Code of Business Conduct
We have also adopted a Code of Business Conduct applicable to all directors, officers, and employees of Adobe as required by applicable Nasdaq listing standards. This Code of Business Conduct is publicly available on our website at http://www.adobe.com/company/integrity.html. There were no waivers of the Code of Business Conduct for any of our directors or executive officers during fiscal year 2020.
Code of Ethics
We adopted a Code of Ethics applicable to our Chief Executive Officer, Chief Financial Officer, Corporate Controller, Treasurer and certain other finance department executives, which is a “code of ethics” as defined by applicable SEC rules. The Code of Ethics is publicly available on our website at http://www.adobe.com/investor-relations/governance.html. If we make any amendments to the Code of Ethics other than technical, administrative, or other non-substantive amendments, or grant any waivers, including implicit waivers, from a provision of this Code of Ethics to our Chief Executive Officer, Chief Financial Officer, Corporate Controller, Treasurer, or certain other finance department executives, we will disclose the nature of the amendment or waiver, its effective date, and to whom it applies, on our website at http://www.adobe.com/company/
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integrity.html or in a Current Report on Form 8-K filed with the SEC. There were no waivers of the Code of Ethics during fiscal year 2020.
The Board’s Role in Risk Oversight
Risk assessment and oversight are an integral part of our governance and management processes. Our Board takes an active role in reviewing Adobe’s corporate strategy and priorities on an ongoing basis, and also encourages management to promote a culture that actively manages risks as a part of Adobe’s corporate strategy and day-to-day business operations. Management discusses strategic and operational risks at regular management meetings, and conducts specific strategic planning and review sessions during the year that include a focused discussion and analysis of the risks facing Adobe. Throughout the year, senior management reviews these risks with the Board at regular Board and committee meetings as part of management presentations that focus on particular business functions, operations, or strategies, and presents the steps taken by management to mitigate such risks. The Board regularly provides management with input on these risks and mitigation steps.
Our Board administers this oversight function directly through the Board as a whole, as well as through various standing committees of the Board that address risks inherent in their respective areas of oversight. In particular, our Board is responsible for monitoring and assessing strategic risk exposure, and our Audit Committee has the responsibility to oversee our major cyber-security, privacy, information security, and financial risk exposures and the steps our management has taken to monitor and control these exposures, as well as oversight of our enterprise risk management program. The Audit Committee also monitors compliance with legal and regulatory requirements and oversees the performance of our internal audit function and of our independent registered public accounting firm. Our Nominating and Governance Committee monitors the effectiveness of our Corporate Governance Guidelines and approves or disapproves any related-persons transactions. Our Executive Compensation Committee assesses and monitors whether any of our compensation policies and programs has the potential to encourage excessive risk-taking, which determination is reviewed by our Audit Committee.
Risk Analysis of Performance-Based Compensation Plans
Our Executive Compensation Committee believes that our employee compensation programs do not encourage excessive and unnecessary risk-taking that would be reasonably likely to have a material adverse effect on Adobe. The Executive Compensation Committee oversaw the performance of a risk assessment of our compensation programs as generally applicable to our employees to ascertain any potential material risks that may be created by our compensation programs. The Executive Compensation Committee considered the findings of the assessment conducted internally and concluded that our compensation programs are designed and administered with the appropriate balance of risk and reward in relation to our overall business strategy and do not encourage employees to take unnecessary or excessive risks, and that the level of risk that they might encourage is not reasonably likely to materially harm our business or financial condition, after considering mitigating controls.
Although the majority of target total direct compensation provided to our executive officers is incentive based, the Executive Compensation Committee believes that our executive compensation programs have been designed with appropriate controls and other mitigating measures to prevent excessive and unnecessary risk taking. Incentive-based employee compensation programs typically make up a smaller percentage of our other employees’ overall compensation and therefore provide less motivation for risk taking. The design of these compensation programs is intended to encourage our employees to remain focused on both short- and long-term operational and financial goals of the company in several key respects:
•    While our Executive Annual Incentive Plan for fiscal year 2020 continued to focus on the achievement of bookings and recurring revenue targets, it added revenue and profitability metrics to the calculation of the Financial Performance Result, incentivizing disciplined growth and expense management. As in prior years, the Executive Annual Incentive Plan also included an individual performance component with objectives for many of our executives relating to strategic objectives. The amended and restated Executive Annual Incentive Plan adopted on June 5, 2020, described under “Compensation Discussion and Analysis”, also capped the Financial Performance Result at 110%, down from 125%, limiting any incentives for unnecessary risk taking.
•    Our Performance Share Program is based on Adobe’s total stockholder return (“TSR”) over a three-year period relative to the companies in the Nasdaq 100 Index, rewarding sustained, measurable performance over a three-year period. In the event Adobe’s TSR places in the bottom 25% relative to the companies in the Nasdaq 100
18 | Adobe Inc.

Index, no shares will be awarded, meaning our executives will be rewarded only when Adobe’s stock is performing adequately relative to the market.
•    Our system of internal controls over financial reporting, standards of business conduct and compliance programs, among other things, reduce the likelihood of manipulation of our financial performance to enhance payments under our bonus and sales compensation plans.
•    Our performance-based plans include a 200% cap on the target awards. We believe this cap limits the incentive for excessive risk-taking by our executives.
•    For our employees below the vice president level, equity incentive awards are solely in the form of restricted stock units (“RSUs”) that vest over four years. Annual equity incentive awards for our executive officers and certain senior employees for fiscal year 2020 and 2021 include RSUs that vest 25% upon the one-year anniversary of the vesting commencement date, and 6.25% quarterly thereafter and performance shares that vest 100% after a three-year cliff, providing strong employee retention incentives and encouraging executive officers and such other employees to focus on sustained stock price appreciation over the long term. Generally, stock options are not granted to members of our Board, our executive officers, or any other employees.
•    Our officers at the senior vice president level and above are all subject to, and in compliance with, our stock ownership guidelines, described under “Compensation Discussion and Analysis—Equity-Related Policies—Stock Ownership Guidelines,” which encourage a robust level of stock ownership aligning our executives’ long-term interests with those of our stockholders.
•    Our Insider Trading Policy prohibits all employees and officers from pledging shares, engaging in short sales or hedging transactions involving Adobe’s securities.
•    We have a clawback policy for performance-based incentive compensation of our executive officers.
Board Evaluation
    On a regular basis, we engage an outside advisor to conduct a comprehensive Board self-evaluation to assess the effectiveness of our Board, committees and members. The process is facilitated by an independent third party to preserve integrity and anonymity of the Board members and company’s senior executives. The evaluation process facilitator meets with each director and some of the company’s senior executives individually to obtain and compile responses to the evaluation, which includes feedback from Board members on other Board members, for review by the Board and senior executives of the company.
    The Board and senior executives of the company then review and discuss the evaluation results and any actions to be taken as a result of the discussion. The results are used to inform Board and committee composition and refreshment, including expansion and refinement of the attributes and experience criteria for Board membership, and to address the evolving needs of the company. The evaluation aims (1) to find opportunities where our Board and committees can improve their performance and effectiveness, (2) to assess any need to evolve the composition and expertise of our Board, and (3) to assure that our Board and committees are operating in accordance with our Corporate Governance Guidelines and committee charters.
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Director Compensation
for Fiscal Year 2020

The following table sets forth certain information with respect to compensation awarded to, paid to, or earned by each of Adobe’s non-employee directors during fiscal year 2020. As an employee director, Mr. Narayen does not receive compensation for service as a director.
Name
Fees Earned
or Paid
in Cash(2)(3)(4)
($)
Stock
Awards
(5)(6)
($)
Option
Awards
($)
Total
($)
Charles M. Geschke(1)
$21,759 $— $— $21,759 
John E. Warnock60,000 294,479 — 354,479 
Amy L. Banse100,000 294,479 — 394,479 
Melanie Boulden(1)
7,212 148,008 — 155,220 
Frank A. Calderoni122,804 294,479 — 417,283 
James E. Daley97,996 294,479 — 392,475 
Laura B. Desmond75,000 294,479 — 369,479 
Kathleen Oberg99,205 294,479 — 393,684 
Dheeraj Pandey80,000 294,479 — 374,479 
David A. Ricks75,000 294,479 — 369,479 
Daniel L. Rosensweig80,000 294,479 — 374,479 
_________________________
(1)Dr. Geschke retired from the Board effective on April 9, 2020 and Ms. Boulden joined the Board effective October 2, 2020.
(2)Director fees were paid at the end of the quarter for which services were provided.
(3)The table below provides a breakdown of the annual retainers and committee fees earned or paid in cash:
NameAnnual Board
Retainers
($)
Audit
Committee
Fees
($)
Executive
Compensation
Committee  Fees
($)
Nominating and
Governance
Committee
Fees
($)
Total
($)
Dr. Geschke*$21,759 $— $— $— $21,759 
Dr. Warnock60,000 — — — 60,000 
Ms. Banse60,000 — 30,000 10,000 100,000 
Ms. Boulden**5,769 — 1,443 7,212 
Mr. Calderoni**92,006 14,396 — 16,402 122,804 
Mr. Daley**77,995 12,803 — 7,198 97,996 
Ms. Desmond60,000 — 15,000 — 75,000 
Ms. Oberg**60,000 32,803 — 6,402 99,205 
Mr. Pandey60,000 20,000 — — 80,000 
Mr. Ricks60,000 — 15,000 — 75,000 
Mr. Rosensweig60,000 20,000 — — 80,000 
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*    Annual board retainer and committee fees are prorated for Dr. Geschke as he retired from the Board effective on April 9, 2020.
**    Annual board retainer fees and Executive Compensation Committee fees for Ms. Boulden are prorated as she joined the Board and the Executive Compensation Committee on October 2, 2020. Annual board retainer fees and Committee fees have also been adjusted for Mr. Calderoni, Mr. Daley, and Ms. Oberg due to changes in Lead Director and Committee memberships – Mr. Calderoni was named Lead Director, removed from the Audit Committee and added as Chair of the Nominating and Governance Committee; Mr. Daley stepped down as Lead Director, was removed from the Nominating and Governance Committee and joined the Audit Committee; and Ms. Oberg joined the Nominating and Governance Committee and was named Chair of the Audit Committee. Each change listed above was effective as of April 9, 2020.
(4)Ms. Boulden, Mr. Calderoni, Mr. Daley, Ms. Desmond, and Mr. Pandey each deferred all cash fees pursuant to Adobe’s Deferred Compensation Plan and Ms. Oberg deferred 75% of cash fees. For more information on this plan, see “Deferred Compensation Plan” below.
(5)On April 10, 2020, each non-employee director then sitting on the Board received an RSU grant per the terms of the Board’s 2019-2020 Non-Employee Director Compensation Policy, as described below. Ms. Banse, Mr. Calderoni, Mr. Daley, Ms. Oberg and Mr. Pandey each elected to defer 100% of their RSU awards granted in 2020 pursuant to Adobe’s Deferred Compensation Plan. For more information on this plan, see “Deferred Compensation Plan” below.
(6)These amounts do not reflect the actual economic value realized by the director for these awards. In accordance with SEC rules, this column reflects the grant date fair value computed in accordance with the Financial Accounting Standards Board’s Accounting Standards Codification Topic 718 Compensation - Stock Compensation, disregarding estimates of forfeitures related to service-based vesting conditions. Ms. Boulden received 309 shares with a value of $478.99 per share as of October 2, 2020 for joining our Board, which remained unvested at 2020 fiscal year-end. Other non-employee directors received their annual equity award of 924 RSUs with a value of $318.70 per share as of April 10, 2020. At 2020 fiscal year end, each non-employee director other than Ms. Boulden held a total of 924 unvested RSUs.

Compensation Philosophy
The general philosophy of our Board is that compensation for non-employee directors should be a mix of cash, payable quarterly, and equity-based compensation to reward them for a year of service in fulfilling their oversight responsibilities. Adobe does not compensate its management director (our Chief Executive Officer) for Board service in addition to his regular employee compensation.
    Decisions regarding the non-employee director compensation program are approved by our full Board based on recommendations by the Executive Compensation Committee. In making such recommendations, the Committee evaluates the appropriate level and form of compensation for non-employee directors and considers potential changes, if any. The Executive Compensation Committee considers advice from Compensia, when appropriate, including consideration of the director compensation practices of peer companies. The Executive Compensation Committee also considers the extent to which our Board compensation practices align with the interests of our stockholders. Our Board reviews the Executive Compensation Committee’s recommendations and then determines the amount of non-employee director compensation.
    The Executive Compensation Committee reviews the total compensation of our non-employee directors and each element of our director compensation program. At the Executive Compensation Committee’s direction, Compensia analyzes the competitive position of our director compensation program against the peer group used to benchmark executive compensation and examines how director compensation levels, practices, and design features compare to members of the peer group.
    While the annual equity award value for non-employee directors for fiscal year 2020 was $285,000, following a review with Compensia of peer company board compensation trends in October 2020, the Executive Compensation Committee recommended, and our Board approved, a Non-Employee Director Compensation Policy for fiscal years 2021 and 2022, which increases the equity annual award value for non-employee directors from $285,000 to $300,000. On a per-director basis, our cash compensation for non-employee directors remains near the peer median and our equity compensation for non-employee directors is near the peer 75th percentile, which is in line with our target positioning.
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Fees Earned or Paid in Cash
Our Board approved the 2019 and 2020 Non-Employee Director Compensation Policy, effective December 1, 2018. Under the policy, each non-employee director received an annual retainer of $60,000 and our Lead Director received an additional Lead Director annual retainer of $50,000, plus committee fees for each committee on which he or she served, as follows:
CommitteeChair
($)
Members
($)
Audit40,00020,000 
Executive Compensation30,00015,000 
Nominating and Governance20,00010,000 
The committee fees for 2020 were consistent with the prior year and remain unchanged in the Non-Employee Director Compensation Policy for fiscal years 2021 and 2022.
Equity Awards
The 2019 and 2020 Non-Employee Director Compensation Policy included an annual grant of RSUs to non-employee directors. The RSUs granted to each non-employee director vested 100% on the day immediately preceding our annual meeting of stockholders that followed the grant date. The annual award was valued at $285,000 (based on the estimated value on the date of grant), and was converted into a number of RSUs based on the average closing market price over the 30 calendar days ending the day prior to the grant date. New directors joining our Board between annual meetings receive a pro-rated annual grant of RSUs. Non-employee directors receive no other equity awards or compensation.
If a non-employee director’s service terminates due to death or disability, the director will be given credit for an additional 12 months of service for the vesting of both RSUs and stock options, and stock options will remain exercisable for one year following the termination or until the expiration of the stock option, if earlier.
In the event of a change of control, any unvested portion of RSUs will become vested in full immediately prior to the effective date of a change of control and any unvested portion of a non-employee director option will become fully vested and exercisable as of immediately prior to the transaction resulting in a change of control, subject to the consummation of the change of control. If the stock option is not assumed or substituted by the acquiring company, it will terminate to the extent it is not exercised on or before the date of such a transaction.
Deferred Compensation Plan
Our Deferred Compensation Plan allows non-employee directors to defer from 5% up to 100% of their cash compensation, which amounts are deemed invested in the investment funds selected by the director from the same fund options as generally available in Adobe’s 401(k) Plan (other than the individual direct brokerage account and Retirement Savings Trust). Participants may also contribute 100% per vesting tranche of their RSU awards. Deferred Compensation Plan participants must elect irrevocably to receive the deferred funds on a specified date at least three years in the future or at termination in the form of a lump sum or annual installments subject to the terms of the plan. Payments of equity deferrals may only be made in the form of a lump sum. Ms. Boulden, Mr. Calderoni, Mr. Daley, Ms. Desmond, and Mr. Pandey participated in the Deferred Compensation Plan with respect to 100% of their respective retainers and committee fees for their services in fiscal year 2020 and Ms. Oberg deferred 75% of her retainer and committee fees. Ms. Banse, Mr. Calderoni, Mr. Daley, Ms. Oberg, and Mr. Pandey elected to defer 100% of their RSU awards granted in 2020. See “Executive Compensation—Nonqualified Deferred Compensation” in this proxy statement for more information regarding our Deferred Compensation Plan.
Expenses
We reimburse our non-employee directors for their reasonable travel and related expenses in connection with attending Board and committee meetings, as well as costs and expenses incurred in attending director education programs and other Adobe-related seminars and conferences.
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Other Benefits
Consistent with prior years, in fiscal year 2020, our founders, Drs. Geschke and Warnock, were offered an opportunity to purchase certain Adobe health, dental, and vision insurance. Participants were responsible for paying 100% of their own insurance premiums.
Stock Ownership Guidelines
We have adopted stock ownership guidelines for members of our Board. Under these guidelines, each non-employee director should hold 50% of the net shares acquired from Adobe until the total number of shares held by such non-employee director equals or exceeds (and continues to equal or exceed) the minimum share ownership requirement. Determined annually, the minimum share ownership for a non-employee director is calculated as follows: shares required to equal a value of ten times the annual retainer divided by the average daily closing share price for the 30-days ending on December 31. Once achieved (following all permissible dispositions under the guidelines), this minimum share value ownership threshold should be maintained going forward. Shares that count toward the ownership requirement include shares owned outright and beneficially owned, vested restricted stock, vested RSUs, and shares issued upon the exercise of vested options, as well as vested performance shares or performance units, as applicable, including such shares that have been deferred into our Deferred Compensation Plan. As of November 27, 2020, each of our non-employee directors was in compliance with these guidelines.
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Environmental, Social and Governance

Adobe approaches environmental, social, and governance (ESG) performance as an integral part of the way we do business. We strive to incorporate ESG principles and practices across everything we do and are proud to earn recognition year after year through accolades such as Fortune’s Great Places to Work, CDP Climate Change A List, and the Dow Jones Sustainability Index, among many others.
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Sustainability
Sustainability is a core value at Adobe. We strive to improve our energy efficiency and achieve a zero-carbon operational footprint; develop digital products designed to enhance the sustainability initiatives of employees and customers; and work with peers, partner organizations, and our own internal teams and employees to foster a culture of sustainability throughout our business and beyond.
We have made significant progress on our goal to be 100% powered by renewable electricity by 2035 through the implementation of a green tariff at our Utah office and by signing a load-matched 100% renewable electricity agreement for our California operations, which will commence in mid-2021. In fiscal year 2020, Adobe furthered its commitment to address climate change by raising our ambition to align to the latest guidance of the United Nations Framework Convention on Climate Change (UNFCCC) to limit global temperature rise to 1.5°C above pre-industrial levels and working with the Science-Based Target Initiative to develop and set new targets beyond our first Science-Based Targets set in 2016.
We advocate for strong, science-based climate policy in regions where we operate and continue to push for new policies to bring renewable energy to communities where we live and work. Additional information related to sustainability is available at http://www.adobe.com/corporate-responsibility/sustainability.html.
Diversity and Inclusion
Adobe for All is our vision to advance diversity & inclusion across the company. We believe that when people feel appreciated and included, they can be more creative, innovative, and successful. We have a four-pronged strategy to grow diversity by (1) galvanizing youth to pursue technology careers; (2) attracting diverse talent and ensuring fair hiring; (3) creating an inclusive workplace for employees; and (4) joining forces with industry partners.
To help support our employees in fiscal year 2020, we introduced a new, global, mandatory “Building Inclusion on Your Team” learning series to guide employees on the actions they can take to strengthen empathy and inclusion. We developed an allyship program to help employees become active and effective allies, with nearly 900 employees planning to participate in the program in fiscal year 2021. We also formed the “Taking Action Initiative” to accelerate the representation, development and success of Adobe’s Black employees while creating change in the broader landscape of social injustice and economic inequality. We continue to support our seven employee resource groups that build community for employees from underrepresented groups and teach cultural empathy to those outside of the groups. In September 2020, Adobe set aspirational goals to increase representation of women in leadership positions to 30% globally by 2025; to double underrepresented minorities (URM)* in leadership positions by 2025; and to double Black representation as a percentage of US employees by 2025. Additional information and diversity metrics are available at www.adobe.com/diversity.
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* Underrepresented minorities are defined as U.S. employees who identify as Black/African American, Hispanic/Latinx, Native American, Pacific Islander, and/or two or more races.
Employee Parity
We have invested in analysis and transparency to demonstrate our commitment to fair compensation and opportunity by reporting pay and opportunity parity. We first announced that we achieved global gender pay parity in October 2018, and in September 2020 we reaffirmed global gender pay parity and achieved pay parity among URM and non-URM employees in the U.S. Further, Adobe coined the term “opportunity parity” to refer to fairness in promotions and horizontal movement across demographic groups. In fiscal year 2020 we shared promotion and horizontal movement metrics by gender and U.S. URM / non-URM groups.
While we are focused on pay parity and opportunity parity as our strategic metrics for equity across our workforce, we also shared median pay gap metrics. As of February 1, 2020, Adobe’s unadjusted global median pay for women was 98.8% of the median pay for men.
Accessibility
Adobe has been a longtime champion for accessibility and the disabled community, in our products, our company, and our communities. We are a member of The Valuable 500, were recognized as a Best Place to Work for Disability Inclusion in DisabilityIN’s 2020 Disability Inclusion Index, and have had longstanding involvement with the W3C’s WCAG guidelines for accessibility. We have incorporated inclusive design principles across our products to make them more accessible, including Liquid Mode in Document Cloud that makes PDFs more readable as well as Adobe Color to help people with colorblindness or other visual color deficiencies.
Materiality Assessment
In 2020, we conducted a comprehensive materiality assessment refresh to align our strategies, programs, and reporting to focus on the issues that matter most to our stakeholders and deliver the greatest social and environmental impact to our communities. Stakeholders engaged in our materiality assessment process included company executives and subject-matter experts, investors, suppliers, partners, corporate peers, NGOs, and think tanks. As a result of this process, we have identified several key areas of opportunity, including diversity, equity and inclusion, environment and climate, creativity for all and digital citizenship, among others.
We publish a Corporate Responsibility report each year and will provide a detailed outline of our ESG performance for fiscal year 2020 in our upcoming report, which we intend to publish in the spring of 2021. Additional information related to ESG is available at http://www.adobe.com/corporate-responsibility.html.
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Executive Officers

Named Executive Officers

Shantanu Narayen
See “Director Nominees” above.
Chairman, President, and Chief Executive Officer

John Murphy
Executive Vice President and Chief Financial Officer
Age 52
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Mr. Murphy currently serves as our Executive Vice President and Chief Financial Officer. He joined Adobe in March 2017 and served as our Senior Vice President, Chief Accounting Officer and Corporate Controller until April 2018. Prior to joining Adobe, Mr. Murphy served as Senior Vice President, Chief Accounting Officer and Corporate Controller of Qualcomm Incorporated from September 2014 to March 2017. He previously served as Senior Vice President, Controller and Chief Accounting Officer of DIRECTV Inc. from November 2007 to August 2014, and Vice President and General Auditor of DIRECTV from October 2004 to November 2007. Prior to joining DIRECTV he worked at several global companies, including Experian, Nestle, and Atlantic Richfield (ARCO), in a variety of finance and accounting roles. He served as Director of DirecTV Holdings LLC from November 2007 until August 2014. Mr. Murphy serves on the Corporate Advisory Board of the Marshall School of Business at the University of Southern California. He holds an MBA from the Marshall School of Business at the University of Southern California, a B.S. in Accounting from Fordham University.

Scott Belsky
Chief Product Officer and Executive Vice President, Creative Cloud
Age 40
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Mr. Belsky joined Adobe in December 2017 as Chief Product Officer and Executive Vice President, Creative Cloud. Prior to joining Adobe, Belsky was a venture investor at Benchmark in San Francisco from February 2016 to December 2017. Prior to Benchmark, Belsky led Adobe's mobile strategy for Creative Cloud from December 2012 to January 2016, having joined the company through the acquisition of Behance. Belsky co-founded Behance in 2006 and served as its CEO for over 6 years. He is an early advisor and investor to Pinterest, Uber, Warby Parker and other early-stage companies, and co-founded and serves on the board of Globality, a platform for next generation enterprise procurement. Mr. Belsky serves on the advisory board of Cornell University's Entrepreneurship Program and as President of the Smithsonian Cooper-Hewitt National Design Museum board of trustees. He holds an MBA from Harvard Business School and a B.S. from Cornell University.
26 | Adobe Inc.

Anil Chakravarthy
Executive Vice President and General Manager, Digital Experience Business and Worldwide Field Operations
Age 53
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Mr. Chakravarthy joined Adobe in January 2020 as Executive Vice President and General Manager, Digital Experience. Prior to joining Adobe, he served as Informatica’s Chief Executive Officer from August 2015 to January 2020 and Executive Vice President and Chief Product Officer from September 2013 to August 2015. Prior to joining Informatica, for over nine years, Mr. Chakravarthy held multiple leadership roles at Symantec Corporation, most recently serving as its Executive Vice President, Information Security from February 2013 to September 2013. Prior to Symantec, he was a Director of Product Management for enterprise security services at VeriSign. Mr. Chakravarthy began his career as an engagement manager at McKinsey & Company. He also serves on the board of the Silicon Valley Leadership Group. Mr. Chakravarthy holds a Bachelor of Technology in Computer Science and Engineering from the Institute of Technology, Varanasi, India and Master of Science and Ph.D. degrees from the Massachusetts Institute of Technology.

Abhay Parasnis
Executive Vice President, Chief Technology Officer, and Chief Product Officer, Document Cloud
Age 46
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Mr. Parasnis currently serves as Executive Vice President, Chief Technology Officer, and Chief Product Officer, Document Cloud. He joined Adobe in July 2015 as Senior Vice President of Adobe's Cloud Technology & Services organization and Chief Technology Officer and in February 2020, he was appointed Chief Technology Officer and Executive Vice President, Strategy and Growth. Prior to joining Adobe, he served as President and Chief Operating Officer at Kony, Inc. from March 2013 to March 2015. From January 2012 to November 2013, Mr. Parasnis was a Senior Vice President and later Strategic Advisor for the Oracle Public Cloud at Oracle. Prior to joining Oracle, he was General Manager of Microsoft Azure AppFabric at Microsoft from April 2009 to December 2011. Mr. Parasnis holds a Bachelor’s degree in electronics and telecommunications from the College of Engineering Pune in India.

Other Executive Officers
Gloria Chen
Chief People Officer and Executive Vice President, Employee Experience
Age 56
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Ms. Chen joined Adobe in 1997 and currently serves as Chief People Officer and Executive Vice President, Employee Experience. In her more than 20 years at Adobe, she has held senior leadership positions in worldwide sales operations, customer service and support, and strategic planning. In October 2009, Ms. Chen was appointed Vice President and Chief of Staff to the Chief Executive Officer. In March 2018, she was promoted to Senior Vice President, Strategy and Growth, in November 2019, she was elevated to Executive Vice President, Strategy and Growth and in January 2020, she was promoted to Chief People Officer and Executive Vice President, Employee Experience. Prior to joining Adobe, Ms. Chen was an engagement manager at McKinsey & Company. Ms. Chen holds a BS in electrical engineering from the University of Washington, an MS in electrical and computer engineering from Carnegie Mellon University and an MBA from Harvard Business School.

2021 Proxy Statement | 27

Ann Lewnes
Chief Marketing Officer and Executive Vice President, Corporate Strategy and Development
Age 59
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Ms. Lewnes joined Adobe in November 2006 and currently serves as Chief Marketing Officer and Executive Vice President, Corporate Strategy and Development. Ann has held the position of Chief Marketing Officer for over a decade and since December 2020, she also leads Adobe’s corporate strategy and strategic M&A efforts globally as Executive Vice President, Corporate Strategy and Development. Prior to joining Adobe, Ms. Lewnes spent 20 years at Intel Corporation, where she was Vice President of Sales and Marketing. Ms. Lewnes is a board member of Mattel and the Adobe Foundation. She holds a B.S. in International Relations and Journalism from Lehigh University.

Dana Rao
Executive Vice President, General Counsel, and Corporate Secretary
Age 51
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Mr. Rao currently serves as our Executive Vice President, General Counsel, and Corporate Secretary. He joined Adobe in April 2012 and served as our Vice President, Intellectual Property and Litigation where he spearheaded strategic initiatives including the company’s litigation efforts, and its patent, trademark and copyright portfolio strategies until June 2018. Prior to joining Adobe, Mr. Rao was with Microsoft Corporation for 11 years, serving in a variety of roles including Associate General Counsel of Intellectual Property and Licensing, where he oversaw all patent matters for Microsoft’s entertainment and devices division as well as the company-wide patent acquisition team. From 1997 until March 2001, he served as a patent attorney at Fenwick & West. He holds a B.S. in Electrical Engineering from Villanova University and a J.D. from George Washington University. 

Mark Garfield
Senior Vice President, Chief Accounting Officer, and Corporate Controller
Age 50
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Mr. Garfield currently serves as our Senior Vice President, Chief Accounting Officer, and Corporate Controller. Prior to joining Adobe in December 2018, Mr. Garfield served as the Vice President of Finance of Cloudflare, Inc. commencing in November 2017. He served as Senior Vice President and Chief Accounting Officer at Symantec Corporation from March 2014 to October 2017. Prior to joining Symantec, he was at Brightstar Corporation where he served primarily as Senior Vice President and Chief Accounting Officer from January 2013 to February 2014. Mr. Garfield served as Director of Finance at Advanced Micro Devices from August 2010 to December 2012. Prior to Advanced Micro Devices, Mr. Garfield also served in senior level finance roles at LoudCloud and Ernst and Young. Mr. Garfield holds a B.A. in Business Economics from University of California at Santa Barbara.



28 | Adobe Inc.


Executive Compensation

Compensation Discussion and Analysis
This Compensation Discussion and Analysis provides information regarding our executive compensation programs during fiscal year 2020 for the following executive officers of Adobe:
Shantanu NarayenChairman, President, and Chief Executive Officer
John MurphyExecutive Vice President and Chief Financial Officer
Scott BelskyChief Product Officer and Executive Vice President, Creative Cloud
Anil ChakravarthyExecutive Vice President and General Manager, Digital Experience Business and Worldwide Field Operations
Abhay ParasnisExecutive Vice President, Chief Technology Officer, and Chief Product Officer, Document Cloud

These executive officers are referred to in this Compensation Discussion and Analysis and in the accompanying compensation tables as our named executive officers, or “NEOs.”
This Compensation Discussion and Analysis describes the material elements of our executive compensation programs for our executive officers during fiscal year 2020. It also provides an overview of our executive compensation philosophy, including our principal compensation programs. Finally, it analyzes how and why the Executive Compensation Committee of our Board (the “Committee”) made its compensation decisions for our executive officers, including our NEOs, in fiscal year 2020.
Fiscal Year 2020 Highlights
Our executive compensation programs are designed to directly tie the outcomes of our incentive compensation awards for our executive officers to the achievement of our key strategic performance objectives and returns to our stockholders, and drive the creation of sustainable long-term stockholder value. Despite changes described below in response to the COVID-19 pandemic, our fiscal year 2020 compensation programs continued to reflect this philosophy, and compensation earned reflected our business achievements.
Our Response to COVID-19
In response to the COVID-19 pandemic, we implemented significant changes that we determined were in the best interest of our employees and the communities in which we operate. First and foremost, we prioritized the health and well-being of our employees. We immediately transitioned the vast majority of our employees to work-from-home, while implementing additional safety measures for employees continuing critical on-site work. We also took a series of steps to provide employees with additional assistance and benefits to support them and their families during the pandemic and help with work/life balance while working from home.
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We stepped up to take care of our communities and customers – provisioning Creative Cloud licenses for students learning from home, and giving our Experience Cloud customers flexibility and additional support. We created a Government Rapid Response Program to help governments adapt and move their vital work and processes to digital workflows. To keep our customers healthy and safe, we transitioned all of our in-person customer events, including Adobe MAX and Adobe Summit, to virtual-only experiences through July 2021.
Due to the COVID-19 pandemic, 2020 was an unprecedented year for many companies, including Adobe. Our financial results in the first quarter of fiscal year 2020 positioned us well against the goals in our fiscal year 2020 operating plan established by the Board. However, early in the second quarter of fiscal year 2020, large parts of the global economy came to a near standstill due to lockdowns and shutdowns of non-essential businesses in the United States and globally. In light of the impact of COVID-19 on our business, on June 5, 2020, the Board revised our fiscal year 2020 operating plan for the second half of fiscal year 2020 and the Committee accordingly revised our executive cash incentive plan as described in the following section.
Cash Incentive Plan Changes
At the outset of fiscal year 2020, the Committee updated our cash-based fiscal year 2020 Executive Annual Incentive Plan (the “Executive Incentive Plan”) to add an additional factor on which to base financial performance – a combination of GAAP revenue and non-GAAP EPS performance as pegged against our fiscal year 2020 operating plan (the “Operating Plan”). Financial performance also continued to be based on a metric that emphasizes Digital Media ARR and Digital Experience subscription bookings (“Bookings”) growth in order to drive growth in our strategic businesses. As in previous years, the plan allowed the Committee to make an adjustment of up to 25 percentage points up or down based on its evaluation of the company’s performance against its corporate priorities and objectives. Additionally, consistent with past practice, an executive’s individual performance was a key component in the calculation of his or her incentive award.
As described above, starting in the second quarter of fiscal year 2020, the COVID-19 pandemic, associated lockdowns, and shutdowns of non-essential businesses brought large parts of the global economy to a halt. In response to these sudden, major shifts affecting the global economy, in June the Board quickly and prudently implemented a revised Operating Plan, which reflected the closures of our offices, suspension of employee travel, a pause in hiring, the potential impact of remote working conditions on demand for our products and services, and acceleration of the discontinuation of our transaction-driven Advertising Cloud offerings. The revised Operating Plan was intended to establish appropriate stretch goals for the second half of the fiscal year in light of the global environment caused by the pandemic, and to reflect strategic decisions intended to better position the company for the future. The revisions to the plan included increasing target for Digital Media ARR while decreasing targets for revenue and Digital Experience bookings.
Accordingly, the Committee revised our Executive Incentive Plan so that it would continue to align with our Operating Plan and the interests of our customers, stockholders, and employees. The Committee lowered the minimum performance thresholds under the Executive Incentive Plan before participants could earn any incentive bonus under the Executive Incentive Plan from exceeding: (1) 96.94% of the Operating Plan’s GAAP revenue target to 60% and (2) 95% of the Operating Plan’s Non-GAAP EPS target to 80%. The Committee simultaneously imposed a more stringent cap on the amount participants could earn by lowering the maximum Financial Performance Result participants could earn under the Executive Incentive Plan.
This blended approach resulted in a Financial Performance Result of 104.7% under our revised 2020 Executive Incentive Plan, due to record revenue and record net new ARR in our Digital Media business and strong Bookings in our Digital Experience business. For more discussion of cash incentive awards, see the section captioned “Cash Incentives” below.
Performance Share Program Results
The three-year performance period under Adobe’s 2018 Performance Share Program closed at the end of our 2020 fiscal year. Under this program, shares were earned based on relative total stockholder return (“TSR”) over a three-year performance period, during which Adobe achieved a total return of approximately 191%. During the performance period, the price of Adobe’s common stock increased from $165.38 to $481.66 (using the 90 calendar day averages preceding the beginning and end of the performance period). With this performance, our percentile rank among the companies included in the Nasdaq 100 Index as of December 2, 2017 was 95th, which under the plan resulted in each of the participants being awarded performance shares equal to 200% of the executive’s target number of shares.
30 | Adobe Inc.

Continued Emphasis on Pay for Performance
Approximately 92% of our CEO’s target total direct compensation in fiscal year 2020 was comprised of equity awards. A substantial percentage (70%) of these awards are based on Adobe’s relative TSR (compared against the companies in the Nasdaq 100 Index) measured over a three-year performance period issued under our Performance Share Program, with the balance of target equity value granted as time-based RSUs that vest according to our four-year vesting schedule. Unless we achieve at least a 50th-percentile rank over the three-year performance period of the Performance Share Program, our CEO and other executive officers will not realize the full intended value of their long-term incentive compensation. Further, because Adobe common stock underlies our equity-based compensation awards, the immediate value of these awards is subject to fluctuations in our stock price, strongly aligning the interests of our executive officers, including our CEO, with those of our stockholders.
    Our pay-for-performance philosophy is reflected in the pie charts below, which depict the composition of our CEO and other NEOs’ target total direct 2020 compensation:
CEO and Other NEOs’ Target Pay Mix(1)(2)
paymix2a.jpg
(1)    The mechanism for calculating target equity award values is described in detail under “Equity Incentives—Equity Compensation Mix.” The amounts shown for all other NEOs represent their average target pay mix. For the actual grant date fair value of equity awards, computed in accordance with stock-based compensation accounting principles, please see “Executive Compensation—Summary Compensation Table.”
(2)    The target pay mix for “All Other NEOs” excludes Mr. Chakravarthy as he received a new hire target equity award in January 2020.
Compensation Approach in Fiscal Year 2021
In addition to taking stockholder feedback into account, the Committee has evaluated a number of other factors discussed below in making decisions about our executive compensation approach. Following this evaluation, the Committee determined not to make any significant changes to the design of our cash incentive plan for fiscal year 2021. The Committee increased the minimum thresholds for revenue and non-GAAP EPS to 80 percent for fiscal year 2021 (from 60 percent in the final Executive Incentive Plan for fiscal year 2020). The Committee also chose to generally continue the approach to the equity compensation program from fiscal year 2020 for fiscal year 2021.
    The Committee believes that both the cash incentive and equity compensation programs have created the desired pay-for-performance incentives, and that these incentives have been driving the intended outcomes in recent fiscal years, resulting in top-line and bottom-line growth and generating significant stockholder value.
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Additional information regarding our fiscal year 2021 executive compensation programs is available in our Current Report on Form 8-K filed with the SEC on January 27, 2021.
Compensation-Setting Governance and Process
The Role of the Compensation Committee
    The Committee oversees and provides strategic direction to management regarding many elements of our executive compensation programs. It reviews and approves the compensation and severance benefits of Adobe’s executive officers, including our NEOs. As part of this review, the Committee regularly solicits input from its independent compensation consultant. In fiscal year 2020, the Committee met regularly in executive session with its independent compensation consultant and without management present. The Chair of the Committee also met separately with the consultant, both with and without management present. The Committee has the authority to obtain independent advice and assistance from internal or external legal, accounting, and other advisors, at Adobe’s expense. The Committee also discusses Mr. Narayen’s performance with the Board and our Lead Director and remains solely responsible for making the final decisions on compensation for our executive officers, including our NEOs.
The Role of Executive Officers
The Committee regularly reviews the compensation programs for our executive officers, including our NEOs, to ensure they achieve the desired goal of aligning our executive compensation structure with our stockholders’ interests. This includes using our incentive compensation awards to support our strategic and operating plans. We also closely monitor the compensation programs and pay levels of executives from companies of similar size and complexity, so that we may ensure that our compensation programs are within the norm of market practices. This aids in the retention of our NEOs in a competitive market for executive talent.
In addition, our CEO conducted reviews of the performance and compensation of the other NEOs, and based on these reviews, made his recommendations for fiscal year 2020 target compensation levels (including adjustments to base salary and target annual cash incentives, if applicable, and equity incentive levels) directly to the Committee. No NEO was present or participated in the final determinations or deliberations of the Committee regarding the amount of any component of his own fiscal year 2020 compensation package.
The Role of the Compensation Consultant
Since 2008, the Committee has engaged Compensia, Inc. as the Committee’s independent compensation consultant to review and provide independent advice concerning all of the components of Adobe’s executive compensation programs, on account of Compensia’s expertise in the software industry, its knowledge of our peer group, and its geographical proximity. Compensia provided the following services on behalf of the Committee during fiscal year 2020: (1) reviewed and provided recommendations on the composition of our peer group, and provided compensation data relating to executives at the selected companies in our peer group; (2) conducted a comprehensive review of the total compensation arrangements for all of our executive officers; (3) provided advice on our executive officers’ compensation; (4) assisted with executive equity program design, including analysis of equity mix, target grant levels and program design parameters; (5) assisted with development of our fiscal year 2021 Executive Annual Incentive Plan; (6) provided updates on say-on-pay results and regulatory developments; (7) conducted a comprehensive review of compensation paid to the Board and provided recommendations to the Committee and the Board regarding director pay; (8) updated the Committee on emerging trends and best practices in the area of executive and board compensation; (9) reviewed peer company and broader market practices related to executive severance and change-in-control agreements; (10) conducted a detailed aggregate equity utilization relative to peer company practices; and (11) reviewed the Compensation Discussion and Analysis for inclusion in our 2021 proxy statement.
Our Employee Experience, Finance and Legal departments work with our CEO and Compensia to design and develop new compensation programs applicable to our NEOs and other executive officers, to recommend changes to existing compensation programs, to recommend financial and other performance targets to be achieved under those programs, to prepare analyses of financial data, to prepare peer group compensation comparisons and other Committee briefing materials and, ultimately, to implement the decisions of the Committee. Members of these departments and our CEO also meet with Compensia separately from the Committee to convey information on proposals that management may make to the Committee, as well as to allow Compensia to collect information about Adobe to develop its own proposals.
32 | Adobe Inc.

The Committee conducted a formal review of Compensia’s independence and is satisfied with the qualifications, performance and independence of Compensia. Other than providing limited guidance to our Employee Experience department regarding Adobe’s broad-based equity compensation design for all employees (as approved by the Committee), Compensia does not provide any other services to Adobe. Adobe pays for the cost of Compensia’s services.
The Role of Stockholders and Say-on-Pay Vote Results
Adobe values the input of our stockholders on our compensation programs. We hold an advisory vote on executive compensation on an annual basis. We also regularly communicate with our stockholders to better understand their opinions on governance issues, including compensation. The Committee carefully considers stockholder feedback and the outcome of each vote when reviewing our executive compensation programs each year.
At our 2020 annual meeting, approximately 93% of the votes cast approved, on an advisory basis, our NEO compensation and disclosures for fiscal year 2019. This percentage of votes in favor of our compensation approach continued to validate our programs. In particular, we believe the strong approval was largely driven by the following attributes of our fiscal year 2019 executive compensation programs, which continued into fiscal year 2020: (1) the high degree of alignment between company performance and our executive compensation programs; (2) basing our Performance Share Program on a three-year performance period with a single objective metric—relative TSR—closely aligning the compensation opportunity of our NEOs to long-term stockholder interests; and (3) basing our short-term cash incentive program on financial metrics that align with our growth strategy, while adding an earnings metric to incentivize profitable growth.
While we welcome stockholder interaction throughout the year, we generally engage in stockholder outreach during two key periods each fiscal year: (1) leading up to our annual meeting of stockholders and (2) during the months of September and October, when Adobe’s management, the Committee and its independent compensation consultant are in the preliminary planning stages for the subsequent year’s compensation programs. During fiscal year 2020, we engaged with several of our largest stockholders in discussions regarding our existing programs and potential changes for the future, and we value the input received during those discussions. We expect to continue stockholder engagement throughout fiscal year 2021 as we consider potential changes to our compensation programs in the future.
The Role of Peer Companies
The Committee regularly reviews relevant market and industry practices on executive compensation. We do so to balance our need to compete for talent with the need to maintain a reasonable and responsible cost structure while aligning our executive officers’ interests with those of our stockholders.
Each year, to assist the Committee in its deliberations on executive compensation, the Committee reviews and updates our list of peer companies as points of comparison, as necessary, to ensure that the comparisons are meaningful. These peer companies are technology companies at which our NEOs’ positions would be analogous in scope and complexity, which operate in similar or related businesses to Adobe, and with which Adobe competes for talent. Compensia provides recommendations on the composition of our compensation “peer group” by considering companies with revenues within 0.5x to 2.0x of Adobe’s and market capitalization within 0.33x to 3.0x of Adobe’s, and taking into account the following criteria:
global multi-faceted software/Internet company;
profit margin within 0.5x to 2.0x of Adobe’s;
number of employees within 0.5x to 2.0x of Adobe’s;
stockholder advisory firm names company as Adobe’s peer;
companies that list Adobe as a peer;
positive revenue growth; and
companies listed as peers by current peers.
2021 Proxy Statement | 33

Based on the factors described above and input from management and Compensia, the Committee approved the peer group for fiscal year 2020, adding Oracle Corporation, SAP SE, and ServiceNow, Inc.
Peer Group for Fiscal Year 2020
Activision Blizzard, Inc.Autodesk, Inc.Booking Holdings Inc.
eBay Inc.Electronic Arts, Inc.Intuit, Inc.
Netflix, Inc.NVIDIA CorporationOracle Corporation
PayPal Holdings Inc.salesforce.com, Inc.SAP SE
ServiceNow, Inc.VMWare Inc.

The Committee’s independent compensation consultant prepares a compensation analysis compiled from both executive compensation surveys and data gathered from publicly available information for our peer group companies. The Committee uses this data to compare the current compensation of our NEOs to the peer group and to determine the relative market value for each NEO position. In addition, because Adobe’s market capitalization is within the top quartile of its peer companies, the Committee and management also specifically consider position of market cap relative to peers when reviewing equity and target total direct compensation levels.
Compensation Philosophy and Objectives
    Adobe’s mission is to change the world through digital experiences. To support our product and technical innovation with strong execution, we strive to create a dynamic work environment that attracts and retains great people who drive successful business outcomes, growth, innovation, and a focus on creating a world-class experience for Adobe’s customers.
Guiding Principles
We believe that the skills, experience, and dedication of our executive officers are critical factors that contribute directly to our operating results, thereby enhancing stockholder value. In order to continue to develop and bring to market the products that drive our financial performance, we must attract, motivate, and retain the top talent within our industry. As such, our compensation programs are designed to:
provide competitive compensation opportunities that attract, as needed, individuals with the skills necessary for us to achieve our business objectives and retain those top performing individuals;
relate directly to our corporate performance and meaningfully drive our business objectives;
reward and motivate strong individual performance, but with a substantial majority of compensation tied to corporate objectives;
avoid undue compensation-related risk; and
create direct alignment with our stockholders by providing equity ownership in the company.
Executive Compensation Policies and Practices
The following aspects of our compensation programs underscore our continued commitment to corporate governance and compensation best practices:
34 | Adobe Inc.

What we doWhat we don’t do
ü
Pay for Performance.
Our executives’ total compensation is designed to pay for performance and is comprised of elements that address both short-term and long-term financial performance.
û
Our Insider Trading Policy, which applies to all employees, officers, and directors, prohibits transactions involving pledging, hedging, or short sales of Adobe equity.
ü
Independent Compensation Consultant.
The Compensation Committee engages its own independent compensation consultant to advise on executive and non-employee director compensation matters.
ûWe do not provide golden parachute excise tax gross-up payments.
ü
Annual Compensation Peer Group Review.
The Compensation Committee reviews the composition of our compensation peer group annually and makes adjustments to the composition of that peer group, if deemed appropriate.
ûWe do not provide defined benefit pension plans, supplemental executive retirement plans, or retiree health benefits.
ü
Annual Say-on-Pay Vote.
We conduct an annual advisory vote on the compensation of our NEOs. At our 2020 Annual Meeting, more than 93% of the votes cast approved the 2019 compensation of our NEOs.
ûOur equity plans do not include an evergreen feature that would automatically replenish the shares available for issuance.
ü
Clawback policy.
We have a clawback policy for performance-based incentive compensation of our executive officers.
ü
Robust Stock Ownership Guidelines.
We have robust stock ownership requirements for our directors and officers at the Senior Vice President level and above.

We believe our executive compensation programs have been effective at driving the achievement of our target financial and strategic results, appropriately aligning executive pay and corporate performance and enabling us to attract and retain top executives within our industry.
Executive Compensation Program Components
Our executive compensation programs include base salary, an annual cash incentive opportunity, equity incentive awards and employee benefits. The percentage of performance-based compensation, or “at risk” pay, for Adobe’s management and other employees generally increases with job responsibility, reflecting our view of internal pay equity and the ability of a given employee to contribute to our results. We also generally align our compensation strategy with the practices of our peer group when possible and to the extent consistent with our business model. Our executive compensation programs focus on linking pay to performance and reinforcing the alignment of our executives’ interests with those of our stockholders. If results do not meet our expectations, our NEOs will receive compensation that is below target levels and may be below market in comparison to our peer group. Similarly, when superior results are achieved, our NEOs may receive compensation that is above target levels and above market. For more information, see the section titled “Realizable Pay” below.

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Compensation Objectives
Objectives
Compensation
Element
DescriptionAttract/Retain Key PerformersReward
Short-Term
Performance
Reward
Long-Term
Performance
Base Salary
Base salary provides market competitive compensation in recognition of role and responsibilities.ü
Cash Incentives
Cash incentives are earned in full or in part only if (1) we achieve certain pre-established one-year company performance targets, (2) the recipient achieves individual performance levels or objectives, and (3) the recipient remains employed with Adobe through the earn date.üü
Equity Incentives
Equity incentives are awarded upon hire and then typically annually thereafter. Awards are both performance-based and time-based, each vesting over multiple years, aligning employee interests with stockholder interests.üü
Employee Benefits
and Perquisites
Benefits programs for all eligible Adobe employees provide protection for physical, emotional and financial well-being.ü
    In setting the mix among the different elements of executive compensation, we do not target specific allocations, but generally emphasize performance-based compensation, both cash and equity, in our executive officers’ compensation. The total target cash compensation opportunity (base salary and target cash incentives) represents less of our executive officers’ total target compensation than the total target equity compensation opportunity, to increase alignment with our stockholders’ interests and motivate performance that creates sustainable long-term stockholder value.
These allocations reflect our belief that a significant portion of our NEOs’ compensation should be performance based and therefore “at risk” based on company and individual performance, as well as NEO service requirements. Since our cash incentive opportunities and equity incentive awards have both upside opportunities and downside risks, and our actual performance can deviate from the target goals, the amount of compensation actually earned will differ from the target allocations.
The fiscal year 2020 target total direct compensation (base salary, target cash incentives, and target equity value) (“TDC”) for each of our NEOs was set by the Committee based on a number of factors, including: competitive pay practices reflected in the peer group data; each executive’s contribution to Adobe; company and individual performance; anticipated future contributions; internal pay equity; and historical pay levels. The Committee also reviewed the positioning of the total target cash and target equity elements of compensation against levels at our peer companies, but these individual elements of NEO compensation may vary based on the importance of the other factors noted above in any given year with respect to any given NEO. Because our fiscal year begins earlier than most of our peer companies, our target TDC attempts to anticipate what the competitive compensation positioning for each role will be for the coming fiscal year.
Base Salary
For fiscal year 2020, the Committee reviewed the base salaries of our NEOs, comparing these salaries to the base salary levels at the companies in our peer group, as well as considering the roles and responsibilities, performance and potential performance of the NEOs, and their mix of other compensation elements (cash and equity incentives). Following its review, the Committee made no change to Mr. Narayen’s base salary and chose to increase the salaries for Messrs. Murphy, Belsky and Parasnis to better align with peer companies, acknowledge increased scope (where applicable), and reward their performance in fiscal year 2019.
36 | Adobe Inc.

Fiscal Year 2020 Base Salaries
Name2020
Salary
($)
2019
Salary
($)
Shantanu Narayen$1,000,000 $1,000,000 
John Murphy650,000 575,000 
Scott Belsky625,000 550,000 
Anil Chakravarthy(1)
725,000 — 
Abhay Parasnis650,000 600,000 
________________________
(1)    Mr. Chakravarthy joined Adobe on January 9, 2020 and was not an NEO during fiscal 2019.
Cash Incentives
Annual Cash Incentive Plan
    As described above, in June 2020, to align with our Board’s changes to the Operating Plan for the second half of fiscal year 2020 in response to macroeconomic trends caused by the COVID-19 pandemic, the Committee revised the Executive Incentive Plan to (1) lower the maximum Financial Performance Result set earlier in January 2020 (which lowered the maximum amount participants could earn) and (2) lower the minimum performance thresholds before participants could earn any incentive bonus under the plan. As in prior years, the Executive Incentive Plan is designed to drive revenue growth, encourage accountability, drive execution of short-term priorities tied to long-term strategy and annual operating plan objectives, and recognize and reward the company’s executives upon the achievement of certain objectives. The Committee set threshold, target, and maximum performance levels for these goals that were based on the Operating Plan.
Plan Design and Target Annual Incentive Opportunity
    The Committee set the target annual cash incentive opportunity for fiscal year 2020 (expressed as a percentage of base salary) for each NEO early in the fiscal year. These targets did not change over the course of fiscal 2020. In setting the target levels, the Committee considered each NEO’s fiscal year 2020 target total cash opportunity against the peer group data provided by its independent compensation consultant, internal pay equity and the roles and responsibilities of the NEOs. The Committee set the fiscal year 2020 target annual cash incentive opportunity for each NEO at the same percentage as their target opportunities for fiscal year 2019, as their target opportunities remained in our target range when compared with our peers.
In fiscal year 2020, our Executive Incentive Plan continued to be designed to align our NEOs’ annual cash incentives with the company’s strategic priorities and financial performance. As with our fiscal year 2019 program, the financial performance metric under the Executive Incentive Plan was based on the company’s strategic priorities of driving ARR growth in Digital Media and Bookings growth in Digital Experience. As discussed in our recent Annual Reports, the Committee and the company’s management believe that these metrics were strong indicators of the forward-looking health of Adobe’s business for fiscal year 2020. In addition, starting in fiscal 2020, in addition to ARR and Bookings growth, 50% of the financial performance metric was also based on two new financial metrics – GAAP revenue and non-GAAP EPS performance as pegged against our Operating Plan for the fiscal year – which we believe will specifically incentivize profitable growth.
The Committee determined in its June 2020 update that, for purposes of earning any award under the Executive Incentive Plan, we must achieve two threshold goals, (1) exceed 60% of the GAAP revenue target and (2) exceed 80% of its annual Non-GAAP EPS target, each as set forth in the Operating Plan. If the threshold goals are not achieved, none of the participants in the Executive Incentive Plan would be eligible to earn any annual cash incentive award. In addition, awards are capped at 100% of target in the event the Financial Performance Result is below 90%. If we achieved the GAAP revenue threshold, each participant would be eligible to earn a maximum award of up to 200% of such participant’s target annual cash incentive opportunity.
The maximum award for each participant is subject to adjustment based on our performance against our corporate priorities and objectives, as well as the individual’s performance against goals tailored to each executive.
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A participant’s award is calculated according to the below formula:
eaipplandesign1a.jpg
________________________
*    Ranges from 0% to 150%
**    Capped at 100% of target in the event the Financial Performance Result is below 90%

Corporate Performance Result
The “Corporate Performance Result” (expressed as a percentage) is based on the financial performance of the company in fiscal year 2020 (the “Financial Performance Result”) and a discretionary strategic performance adjustment of up to 25 percentage points up or down based on the Committee’s assessment of the company’s performance against its corporate priorities and objectives during the performance period (the “Strategic Performance Adjustment”). The Financial Performance Result is determined by both (1) a Net New Sales metric comprised of net new Digital Media ARR (as defined below) and Bookings growth in Digital Experience, in both cases as set forth in the Operating Plan, and (2) GAAP revenue and non-GAAP EPS performance against the Operating Plan targets.
As described in our Annual Report on Form 10-K for the fiscal year ended November 27, 2020, we define annualized recurring revenue, or ARR, in our Digital Media business as the sum of Creative ARR and Document Cloud ARR. We define Creative ARR as the sum of (1) the annual value of Creative Cloud subscriptions and services, plus (2) the annual contract value of Creative Enterprise Term License Agreements. We define Document Cloud ARR as the sum of (1) the annual value of Document Cloud subscriptions and services, plus (2) the annual contract value of Document Cloud Enterprise Term License Agreements. A table showing the relationships between financial performance, as a percentage of the Operating Plan targets, and the funding results under the Executive Incentive Plan can be found in Exhibit 10.1 to the Current Report on Form 8-K Adobe filed with the SEC on June 11, 2020.
Individual Performance Result
The “Individual Performance Result” (expressed as a percentage ranging from 0% to 150%) is based on the Committee’s assessment of each participant’s individual performance including, without limitation, achievement of individual goals set by the Committee at the outset of the fiscal year.
The individual goals were selected by the Committee in consultation with our CEO (other than with respect to his own goals) at the outset of fiscal year 2020, and the Committee reviewed the achievement of such individual goals for each NEO to determine the NEO’s Individual Performance Result. For our CEO, these individual goals for fiscal year 2020 are shown in the table below. For our other NEOs, the individual goals for fiscal year 2020 are also shown in the table below, and were specifically tailored to the functions led by each NEO and aligned to the achievement of our overall Operating Plan.
38 | Adobe Inc.

Executive OfficerIndividual Performance Goals
Shantanu NarayenDrive the company’s multi-year growth strategy; focus on product and platform innovation; deepen the leadership bench strength and scale; and increase larger customer and partner sponsorship.
John MurphyDrive return on investment, efficiency and revenue growth; and deliver insights through finance organization to improve operational performance.
Scott BelskyDrive success of new products; deliver innovation and customer satisfaction on existing products; define strategy for market expansion; and improve activation and engagement.
Anil ChakravarthyUnify Digital Experience and Worldwide Field Operations teams; drive product innovation; and improve customer success and growth in enterprise and commercial businesses.
Abhay ParasnisDrive cross-cloud solution strategy; accelerate Sensei platform adaption and increase adoption of Adobe Cloud Platform; and incubate breakthrough technologies.
Individual EAIP Award
Once each component described above is certified by the Committee, the award earned by each participant is determined using the formula above, provided that in no event will a participant’s award exceed 100% of the participant’s individual target award if the Financial Performance Result is not at least 90%. Amounts paid under the Executive Incentive Plan are subject to recoupment from the participants in accordance with our clawback policies.
Fiscal Year 2020 Results and Payouts
As mentioned above, the targets and thresholds for the Executive Incentive Plan were revised in June 2020 due to the impact of COVID-19 on our business. At that time, the Committee believed the Executive Incentive Plan goals remained appropriate and were challenging in light of the macroeconomic environment.
In fiscal year 2020, we achieved $12.87 billion of revenue, exceeding our GAAP Revenue funding threshold level. Diluted earnings per share was $10.83 on a GAAP basis, and $10.10 on a non-GAAP basis. (See Annex A for a reconciliation of non-GAAP diluted EPS and non-GAAP operating income to GAAP diluted EPS and GAAP operating income.) According to the matrix included as Exhibit A to the Executive Incentive Plan, as set forth in Exhibit 10.1 to our 8-K filed with the SEC on June 11, 2020, the Net New Sales metrics resulted in a payout of 98.6% and GAAP revenue and non-GAAP EPS performance resulted in a payout of 110%. This produced an overall Financial Performance Result of 104.7%. The Committee elected to not exercise its discretion to make a Strategic Performance Adjustment for each of our NEOs.
The Committee monitored each NEO’s performance on a periodic basis during the year and measured total achievement at year end. Based on the Committee’s assessment of each NEO’s individual performance during the fiscal year, including progress against the individual goals shown above, the Committee determined the individual performance assessment for the participants as shown in the table below:
NameIndividual Performance ResultCorporate
Performance Result
Actual Award Payout
(% of Target Award)
Shantanu Narayen100%x104.7%=104.7%
John Murphy100%x104.7%=104.7%
Scott Belsky100%x104.7%=104.7%
Anil Chakravarthy100%x104.7%=104.7%
Abhay Parasnis100%x104.7%=104.7%
The following table shows the calculation of the individual cash bonuses awarded by the Committee based on the formulas set forth above:
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Fiscal Year 2020 Executive Incentive Plan Cash Bonus
Name
Weighted Base Salary(1)
($)
Target
Cash
Incentive
(%)
Target
Cash
Incentive
($)
Actual Award
Payout
(%)
Actual Cash Incentive Earned
($)
Shantanu Narayen$1,000,000 200 %$2,000,000 104.7 %$2,094,000 
John Murphy638,050 100 %638,050 104.7 %668,038 
Scott Belsky613,050 100 %613,050 104.7 %641,863 
Anil Chakravarthy
645,330 100 %645,330 104.7 %675,660 
Abhay Parasnis642,033 100 %642,033 104.7 %672,209 
________________________
(1)    Base salary adjustments for Messrs. Murphy, Belsky and Parasnis took effect on January 27, 2020. Mr. Chakravarthy’s base salary for purposes of this calculation was prorated from his hire date of January 9, 2020.
Other Cash Incentives
The Committee retains authority to pay additional discretionary bonuses outside the Executive Incentive Plan but declined to grant any such awards in fiscal year 2020.
Equity Incentives
Goals of Equity Compensation
    We use equity compensation to motivate and reward strong corporate performance and to retain valued executive officers. We also use equity incentive awards as a means to attract and recruit qualified executives. We believe that equity awards serve to align the interests of our NEOs with those of our stockholders by rewarding them for growing the value of the company. By having a significant percentage of our NEOs’ target TDC payable in the form of multi-year equity and, thus, subject to higher risk and longer vesting than cash compensation, our NEOs are motivated to make decisions that will benefit Adobe and its stockholders in the long term.
Equity Compensation Mix
    For our fiscal year 2020 equity program established in January 2020, the Committee continued to differentiate between the CEO target mix of equity incentive awards and that of our other NEOs. Beginning with fiscal year 2020, the target mix of ongoing annual equity incentive awards to our CEO consisted of 70% performance share awards (up from 60%) and 30% time-based RSUs (down from 40%) in order to align our CEO more closely with the interests of our stockholders by having a larger proportion of his target TDC "at risk". The target mix of equity incentive awards to Messrs. Murphy, Belsky and Parasnis remained unchanged at 50% performance share awards and 50% time-based RSUs. The Committee determined that this mix of equity compensation would appropriately balance and meet our compensation objectives, as described in the table below. The Committee calculated the target values for equity to achieve this desired mix, based on a price of $346.91 per share, the trailing 10-day average of the closing price per share of our common stock as of January 22, 2020, the period just prior to the development of the equity compensation award recommendations. Based on this price per share, the total desired number of targeted shares was determined and then split, as applicable, between performance shares and time-based RSUs, each rounded up to the nearest whole share.

Mr. Chakravarthy, who was hired in January 2020, received equity awards in fiscal year 2020 consisting of 33% performance share awards and 67% new-hire time-based RSUs.

40 | Adobe Inc.

Fiscal Year 2020 Mix of Annual Equity Incentive Awards
Type of
Equity
(Allocation
Percentage(1))
DescriptionObjectives/Dilutive Effect
Vesting(2)
Performance Share Awards
(CEO ~70%, Other NEOs ~50%)
Stock-settled awards subject to performance- and time-based vesting conditions; three-year cliff performance period determines the total number of shares earned, with significant benefits for overachievement and significant consequences for underachievement, including the potential for no award being earned; no purchase cost to executive, so awards always have value if earnedFocus NEOs on a three-year performance goal tied to long-term stockholder returns while also providing a strong retention incentive, requiring continuous employment to vest; provide significant incentive to grow our stock price; and use fewer shares than stock options, so less dilutive
Performance shares vest upon the certification of performance results following a three-year performance period
Time-Based RSUs
(CEO ~30%, Other NEOs ~50%)
Stock-settled awards subject to time-based vesting conditions; no purchase cost to executive, so awards always have value, if earnedProvide a strong incentive for our NEOs to remain employed with us, as they require continuous employment while vesting; provide moderate reward for growth in our stock price; and use fewer shares than stock options, so less dilutiveVest over a period of four years; specifically, 25% on the first anniversary of the vesting commencement date and 6.25% quarterly thereafter for the remaining three years
_________________________
(1)    The percentages for Other NEOs exclude Mr. Chakravarthy due to his new hire RSU grant in January 2020.
(2)    Our NEOs’ equity awards are also subject to certain accelerated vesting provisions as described under “Severance and Change of Control Compensation” and “Executive Compensation—Grants of Plan-Based Awards in Fiscal Year 2020—Narrative Summary to Summary Compensation Table and Grants of Plan-Based Awards in Fiscal Year 2020 Table—Effect of Retirement, Death and Disability on Equity Compensation Awards.
Target Value and Award Determination
For fiscal year 2020, the Committee, with input from its independent compensation consultant, management, and our CEO, took a number of factors into account in determining the target value of the equity compensation opportunity for each of our NEOs. Among these factors were the individual performance of executives, peer group positioning, internal pay equity, our employee retention objectives, and the other factors for determining compensation discussed under “Compensation Philosophy and Objectives” above. With regard to peer group positioning, the Committee reviews the value of equity awards in the aggregate because of the different mix of equity awards granted by our peers, and the aggregated manner in which this data is presented in the peer group analyses.
The following table sets forth the total target value of equity awards for each NEO determined by the Committee, as well as the resulting number of performance shares (at target and maximum performance) and RSUs granted to each of our NEOs in January 2020. Note that this table reflects the values targeted by the Committee; for the actual grant date fair values of these equity awards, computed in accordance with stock-based compensation accounting principles, please see “Executive Compensation—Summary Compensation Table.”
2021 Proxy Statement | 41

Equity Awards Granted by the Committee During Fiscal Year 2020
Performance Share Program(1)
Name
Total Target Value of
Equity Award
($)
(2)
Target
Award
(#)
Maximum
Award
(#)
RSU
Award
(#)
Shantanu Narayen$32,500,000 65,579 131,158 28,106 
John Murphy7,000,000 10,090 20,180 10,090 
Scott Belsky7,000,000 10,090 20,180 10,090 
Anil Chakravarthy (3)
15,000,000 14,413 28,826 33,056 
Abhay Parasnis7,000,000 10,090 20,180 10,090 
_________________________
(1)    Achievement of goals for performance shares granted in 2020 will be certified by the Committee following the completion of the three-year performance period.
(2)    Amount of performance shares and RSUs awarded to each NEO is based on the total target equity value for each NEO described above under “Equity Compensation Mix.”
(3)     Includes new hire RSUs with a target equity award value of $10,000,000 that were granted to Mr. Chakravarthy upon his joining Adobe in January 2020.
2020 Performance Share Program
As with our 2019 Performance Share Program, under our 2020 Performance Share Program shares are earned based on a single objective financial measure—relative TSR over a three-year performance period. All earned performance share awards will vest upon the later of the Committee’s certification of results and the three-year anniversary of the vesting commencement date. Accordingly, the performance shares will align our NEOs’ interests with those of our stockholders over the long term, while also providing key retention incentives, as the shares will only be awarded if an NEO remains providing service to Adobe (or an affiliate) upon the date of the Committee’s certification of results following the end of the three-year performance period. Moreover, the design of our Performance Share Program will result in strengthened retention incentives for our executives during periods over which the company is delivering favorable returns to our stockholders. The Committee believes in the importance of balancing absolute performance with that of relative performance to ensure that the company performs well relative to benchmark companies.
Under the 2020 Performance Share Program, the participants can earn between 0% and 200% (the payout cap under our program) of the target number of performance shares. The relative TSR measure compares the TSR of our common stock against the TSR of the companies included in the Nasdaq 100 Index as of November 30, 2019 over a three-year performance period, using a cumulative 90 calendar day look-back as of the beginning and the end of the three-year period. This TSR metric creates accountability since the payout depends upon our stockholder return being better than other companies in the Nasdaq 100 Index, companies the Committee and Adobe’s management believe constitute the most relevant market benchmark for Adobe’s performance. Also, the Nasdaq 100 Index (as opposed to our peer group) is broad enough to accommodate the high amount of consolidation and acquisition in our industry sector without significantly impacting the overall makeup of comparative companies between the start and end of the performance period.
The number of performance shares earned is calculated based on the formula below, and will increase or decrease 2.5% for every percentile that Adobe’s TSR percentile rank is above or below, respectively, the Nasdaq 100 companies’ 50th percentile, subject to the limitations in the chart below.
100% - ((50 - Percentile Rank) * 2.5%) = Percentage Payout
42 | Adobe Inc.

Company Percentile Rank as Compared to Index Companies
Shares of Stock That May Be Earned
as a Percentage of Target Shares
(“Percentage Payout”)
Below 25th (1)
0%
25th
38%
35th
63%
50th
100%(2)
75th
163%
90th
200%(3)
100th
200%
_________________________
(1)    A threshold percentile rank of 25% is required before any performance shares can be earned.
(2)    The maximum number of performance shares that may be earned at the 50th percentile or higher is capped at 100% of target, if Adobe’s absolute TSR is negative.
(3)    The maximum shares that may be earned is 200% of target, if Adobe’s absolute TSR is positive.
Because our 2020 Performance Share Program is based on a three-year performance period, none of the performance shares can be earned until the Committee certifies the level of achievement after the performance period closes.
For more information on the performance share awards granted during fiscal year 2020, see the “Executive Compensation—Grants of Plan-Based Awards in Fiscal Year 2020” table and accompanying narrative.
2018 Performance Share Program Results and Payouts
The three-year performance period under Adobe’s 2018 Performance Share Program closed at the end of our 2020 fiscal year. As with our 2020 Performance Share Program described above, shares under the 2018 Performance Share Program were earned based on our relative TSR (compared against the companies in the Nasdaq 100 Index) measured over a three-year performance period. At the end of the performance period, there were 76 companies remaining in the relative peer group selected for the 2018 program. For the three-year performance period, Adobe’s TSR was approximately 191%, calculated based on the methodology set forth in the program.
The Committee engages an independent outside consultant to review the peer group data and calculate the results under our 2018 Performance Share Program. Of the companies remaining following the performance period, 71 had TSRs less than Adobe’s, and four had TSRs greater than Adobe’s, resulting in a 95th percentile ranking.
As described in our 2018 Performance Share Program, if Adobe’s absolute TSR is positive, the company's achievement of a percentile rank that exceeded the 50th percentile would increase the number of shares of stock that would be earned by increments of 2.5%, rounded up to the nearest whole percent, calculated using the same formula and chart as shown above for the 2020 Performance Share Program.
Under that formula, our percentile rank resulted in the maximum percentage payout of 200%. The target, maximum and actual shares earned and awarded to our NEO participants under the 2018 Performance Share Program, as certified by the Committee, are set forth in the table below:
2021 Proxy Statement | 43

2018 Performance Share Program Results
Name(1)
Target
Award
(#)
Maximum
Award
(#)
Actual
Achievement
(%)
Shares Awarded
(#)
Shantanu Narayen61,345 122,690 200 %122,690 
John Murphy3,835 7,670 200 %7,670 
Scott Belsky12,780 25,560 200 %25,560 
Abhay Parasnis15,340 30,680 200 %30,680 
________________________
(1)    Mr. Chakravarthy was not a participant in the 2018 Performance Share Program because he was not employed by Adobe at the time the awards were granted.
2020 RSU Program
Recognizing that a substantial portion of our NEOs’ compensation is performance based, and therefore inherently at risk, the Committee granted time-based RSUs to our NEOs in order to satisfy our retention objectives and promote continuity in our business. The RSUs vest 25% on the one-year anniversary of the vesting commencement date and then 6.25% quarterly thereafter for the remaining three years of the award. Accordingly, our RSU program provides our NEOs with strong incentives to remain employed by Adobe, while providing additional rewards for growth in our stock price with less dilution to the company than time-based stock options, which were not granted by Adobe to any executive officer in fiscal year 2020.
Employment Agreements
Each of our NEOs is employed “at will.” Except in limited circumstances, such as when an employment agreement that provides for severance is assumed or renegotiated as part of a corporate transaction, we only enter into agreements providing for severance benefits with our U.S. executive officers in relation to a change of control of Adobe or an executive transition plan.
Realizable Pay
Realizable pay reflects the real value of equity awards and increases or decreases with fluctuations in market value. When determining the annual equity grants to our executives in January of each year, the Committee believes it is important to take into account not only the grant date fair values included in our Summary Compensation Table, but also to consider the effect of the year-end value of our stock on those awards over time.
Given that approximately 92% of our CEO’s and 83% of our other NEOs’ target total direct compensation for fiscal year 2020 is equity based, the Committee and the company consider it especially important to focus on realizable pay when evaluating the effectiveness of our pay for performance philosophy. For example, decreases in our stock price could cause stock-based awards to have realizable values that are less than what was targeted at the time of grant, including performance periods under our Performance Share Programs potentially closing with no value earned and no dilutive effect to the company. 
As discussed above, the Committee sets our CEO's target compensation every year in consultation with our external compensation consultant and with reference to peer company pay practices. Our equity compensation programs are designed to incentivize performance and drive stockholder returns. The following chart demonstrates the relationship between the target and realizable values of our CEO’s total direct compensation and Adobe’s indexed TSR for the past five completed fiscal years. When our stock price increases and generates positive returns for Adobe’s stockholders, the increase impacts an executive’s realizable pay during the present fiscal year and for past fiscal years during which the executive received equity awards that are held or still subject to vesting. The following chart demonstrates that our equity compensation programs have been working as intended by the Committee, providing meaningful incentives for Adobe’s executives to drive strong stockholder returns relative to our peer group over the long-term.
44 | Adobe Inc.

realizablepay1a.jpg
Target TDC:  Target TDC is the sum of our CEO’s target base salary as disclosed in the Compensation Discussion and Analysis sections of this and prior proxy statements, the target incentive amount (which is the target bonus percentage multiplied by the respective target base salary), and equity award target grant date fair values. No target value for All Other Compensation is included.
Realizable TDC: Realizable TDC is the sum of our CEO’s actual earned base salary, bonus, non-equity incentive plan compensation, and all other compensation as disclosed in the Summary Compensation Table, and equity award values of all restricted stock units and performance shares granted (adjusted to reflect actual or current estimated payout of outstanding PSUs as of the last day of fiscal year 2020) in each year multiplied by the stock price per share on the last day of fiscal year 2020 of $477.03.
Indexed TSR:  Indexed TSR is calculated by taking the stock price per share on the last day of fiscal years 2016 to 2020 of $99.73, $179.52, $250.89, $309.53 and $477.03, respectively, and dividing each by the stock price per share on the last day of fiscal year 2015 of $92.17.
Other Benefits and Programs
Retirement and Deferred Compensation Plan Benefits
We do not provide our employees, including our NEOs, with a defined benefit pension plan, any supplemental executive retirement plans or retiree health benefits, except as required by local law or custom for employees outside the United States. Our NEOs may participate on the same basis as other U.S. employees in our Section 401(k) Retirement Savings Plan (the “401(k) Plan”) with a company-sponsored match component.
We also maintain an unfunded, nonqualified deferred compensation plan (the “Deferred Compensation Plan”). Our executives and our Board members are eligible to participate at their election. The Deferred Compensation Plan provides the ability to defer receipt of income to a later date, which may be an attractive tax planning opportunity. We generally do not contribute to the Deferred Compensation Plan on behalf of participants; therefore, our cost to maintain the Deferred Compensation Plan is limited to administration expenses, which are minimal. Other than Mr. Narayen, no other NEOs participated in or had an accrued balance under the Deferred Compensation Plan in fiscal year 2020.
Perquisites and Additional Benefits and Programs
We provide limited perquisites to our executives, including our NEOs. In considering potential perquisites, the Committee considers the cost to Adobe as compared to the perceived value to our employees as well as other corporate
2021 Proxy Statement | 45

governance and employee relations factors. We offer our executives at the director level and above, including our NEOs, an annual comprehensive physical examination that is fully funded by Adobe, as an added benefit to the Adobe medical insurance provided. Alternatively, our NEOs may choose to enroll in a health concierge service. Adobe recognizes the significant role of its executives and offers this program to encourage a focus on keeping well. In fiscal year 2020, in response to the COVID-19 pandemic, we also provided free COVID testing to our senior management and their immediate family members.
In fiscal year 2018, the Board approved the purchase of a corporate jet as a security measure for our CEO and to optimize his travel. The aircraft is primarily for the use of our CEO, with certain limited exceptions where other executives may use it solely for business purposes. In the interests of security and efficiency, as well as our CEO’s health and safety, the Committee has encouraged our CEO to use the corporate aircraft for personal travel by providing an annual $400,000 allowance for incremental costs associated with his personal use of the jet, after which he must fully reimburse the Company for all additional incremental costs associated with personal use of the aircraft pursuant to an aircraft time sharing agreement with the Company. The incremental costs of non-business-related travel and guests on any such legs is included in the “All Other Compensation” column in the Summary Compensation Table. Our CEO recognized imputed taxable income and is not provided a tax reimbursement for any personal use of the aircraft, including for members of the CEO’s immediate family accompanying the CEO on business travel.
We also provide the following benefits to our NEOs, on the same terms and conditions as provided to all other eligible employees: health, dental, and vision insurance; life insurance; an Employee Stock Purchase Plan; health savings account; medical and dependent care flexible spending account; and short- and long-term disability, accidental death and dismemberment insurance. We believe these benefits are consistent with benefits provided by companies with which we compete for executive-level talent.
Severance and Change of Control Compensation
The Committee believes that change of control vesting of equity awards and severance benefits, if structured appropriately, serve to minimize the distraction caused by a potential transaction and reduce the risk that an executive departs Adobe before an acquisition is consummated. The Committee and the company believe that a pre-existing plan will allow our executives to focus on continuing normal business operations and on the success of a potential business combination, rather than on seeking alternative employment. Further, a pre-existing plan ensures stability and will enable our executives to maintain a balanced perspective in making overall business decisions during a potentially uncertain period. To that end, Adobe provides certain change of control benefits as described below.
Each of our NEOs is an eligible participant in our 2020 Executive Severance Plan in the Event of a Change of Control (the “Change of Control Plan”). The Change of Control Plan provides for severance payments and fully accelerated vesting of outstanding equity awards for our NEOs and other members of senior management upon an involuntary termination of employment upon or following a qualifying change of control. The terms of the Change of Control Plan are described below.
We also maintain a Retention Agreement with Mr. Narayen, which provides similar benefits but does not require termination of his employment in order for him to receive the equity acceleration, as described below under “Executive Compensation—Change of Control.” Mr. Narayen’s original Retention Agreement, dated January 12, 1998, was amended February 11, 2008 based on his promotion to Chief Executive Officer, and was further amended on December 11, 2010 and December 5, 2014 in order to clarify the manner of compliance with, or exemption from, Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).
The Change of Control Plan and the Retention Agreement with Mr. Narayen do not provide for reimbursements or “gross-ups” of excise tax amounts under Section 4999 of the Code. Rather, under both of these arrangements, benefits would be reduced if doing so would result in a better after-tax economic position for the affected executive. The Committee and the company believe this is an appropriate allocation of the tax cost of these arrangements between Adobe and the executive and is consistent with market practice.
Our change of control arrangements are designed to be competitive with the pay practices of our peer group. The Committee periodically reviews the terms and conditions of our change of control arrangements and will make adjustments when and to the extent it deems appropriate. The Change of Control Plan will expire on December 13, 2023.
Additional details regarding our Change of Control Plan and the Retention Agreement with Mr. Narayen, including estimates of amounts payable in specified circumstances as of the last day of fiscal year 2020, are disclosed in the “Executive
46 | Adobe Inc.

Compensation—Change of Control—Potential Payments upon Termination and/or a Change of Control” table contained in this proxy statement.
Equity-Related Policies
Stock Ownership Guidelines
In 2003, our Board adopted stock ownership guidelines for all employees at the senior vice president level and above (including our executive officers) and directors, which the Committee reviews periodically. These guidelines are designed to align our executive officers’ interests with those of our stockholders by promoting long-term share ownership, which reduces the incentive for excessive short-term risk taking. Under the guidelines, our executive officers should hold 50% of the net shares acquired until they satisfy (and continue to satisfy) the minimum share ownership value requirements listed in the table below.
PositionMinimum Ownership Value
Chief Executive Officer20x base salary
President, Executive Vice President, or Chief Financial Officer10x base salary
Senior Vice President3x base salary
The minimum share ownership levels for each title are determined annually using the following:
average base salary of the individuals holding such title as of December 31; and
the average daily closing share price for the 30 days ending on December 31.
Once an executive officer achieves the minimum share threshold measured by the value of shares held, they should retain shares necessary to meet the minimum ownership requirement throughout the year. Shares that count toward the minimum share ownership levels include: shares owned outright and beneficially owned; shares purchased in the open market or inherited; shares acquired through the company’s Employee Stock Purchase Plan; vested restricted stock; vested RSUs, performance shares and performance units in our Deferred Compensation Plan; and shares issued from the exercise of vested options. Any shares held prior to the executive officer’s date of appointment will also count toward the ownership requirement.
The Committee reviews quarterly reports of the stock holdings of our officers and directors. Our Board may evaluate whether exceptions should be made in the case of any covered person who, due to his or her unique financial circumstances, would incur a hardship by complying with these guidelines. No such exceptions were granted or were in place in fiscal year 2020. As of November 27, 2020, each of our NEOs was in compliance with the applicable guidelines.
Anti-Hedging and Anti-Pledging Policy
Our insider trading policy explicitly prohibits any director or employee, including our NEOs, from hedging their equity ownership in Adobe by engaging in short sales or trading in any derivatives involving Adobe securities. All employees are also prohibited from holding Adobe stock in a margin account or otherwise pledging Adobe stock or using financial instruments such as prepaid variable forwards, equity swaps, exchange funds, and collars.
Performance-Based Compensation Recovery Policy
Our Board has adopted a Clawback Policy applicable in the event of a material restatement of our financial statements that results from the intentional misconduct or fraud of a Section 16 executive officer. The Clawback Policy enables the Board to require repayment or cancellation of the incremental portion of the performance-based incentive compensation paid or payable to such officer in excess of the amount that would have been paid or payable based on the restated financial results. We will also continue to monitor rule-making actions of the SEC and Nasdaq related to clawback policies and implement such rules when required.
2021 Proxy Statement | 47

In addition, as a public company subject to Section 304 of the Sarbanes-Oxley Act of 2002, if we are required to restate our financial results as the result of misconduct or due to our material noncompliance with any financial reporting requirements under the federal securities laws, our CEO and CFO may be legally required to reimburse us for any bonus or incentive-based or equity-based compensation they receive.
Granting Guidelines for Equity Compensation
Adobe has adopted written guidelines setting forth our grant practices and procedures for all equity awards. Pursuant to these guidelines:
the vesting commencement date for our annual equity awards granted to our employees, including the NEOs, is January 24 of each year, unless another date is approved and documented by the Committee;
the effective grant date for non-executive officer new hire RSU awards is the 15th day of the month following the month of the employee’s hire date, or, if that is not a trading day, the first trading day thereafter; and
the effective grant date for promotion RSU awards is the 15th day of the month following the month of the employee’s promotion.
Because the foregoing grant dates are pre-established, the timing of the release of material non-public information does not affect the grant dates for equity awards, and Adobe does not time the release of material non-public information based on equity award grant dates. Pursuant to our practices for executive officers, the effective grant date for new hire RSU and performance share awards is the executive officer’s hire date.
The Committee approves all grants made to our executive officers on or before the grant date. The Committee also has the authority to approve non-executive officer stock option, performance share, and RSU awards. Our Board has also delegated to a Management Committee for Employee Equity Awards (consisting of the Chief Executive Officer and the Chief People Officer & Executive Vice President, Employee Experience) the authority to approve RSU awards to non-executive officer employees in accordance with the granting guidelines described above and subject to Committee-approved vesting schedules and share limits. In addition, our Board has delegated to an Acquired Company & Retention Equity Awards Committee (consisting of the CEO in his capacity as a member of the Board) the authority to approve the assumption of outstanding awards in an acquisition, and the granting of stock option, performance share and RSU awards to employees and consultants. Pursuant to its charter, the Committee has the authority to establish the terms and conditions of our equity awards; therefore, the Committee may make exceptions to Adobe’s granting guidelines.
In the event we award stock options, all stock option awards would be granted with an exercise price equal to or greater than the closing price of the underlying stock on the effective grant date or, in accordance with the terms of our approved equity plans, the closing price of the underlying stock on the last trading day prior to the effective grant date, if an award is granted on a non-trading day.
Tax and Accounting Considerations
The Committee considers the financial accounting and tax consequences to Adobe of our compensation programs and the tax consequences to our employees. In determining the aggregate number and mix of equity grants in any fiscal year, the Committee and management consider the size and share-based compensation expense of outstanding and new equity awards.
Section 162(m) of the Code generally disallows a tax deduction to public companies for compensation greater than $1 million paid for any fiscal year to certain executive officers. For taxable years beginning after December 31, 2017, this limit applies to performance-based compensation that was previously eligible for exclusion from the $1 million deduction limit, unless the compensation is eligible for grandfathering under the December 2017 tax law changes.
The Committee believes it is important to preserve flexibility in administering and designing compensation programs. Accordingly, we do not require that all compensation be deductible as corporate objectives may not always be consistent with the requirements for full deductibility. The Committee expects it will grant awards and provide for compensation that will not be deductible under Section 162(m) when it believes that such non-deductible arrangements are otherwise in the best interests of Adobe and its stockholders.
48 | Adobe Inc.

Report of the Executive Compensation Committee
The Executive Compensation Committee has reviewed and discussed with management the “Compensation Discussion and Analysis” contained in this proxy statement. Based on this review and discussion, the Executive Compensation Committee recommended to our Board that the Compensation Discussion and Analysis be included in our Annual Report on Form 10-K for the fiscal year ended November 27, 2020 and in this proxy statement.
Respectfully submitted,
EXECUTIVE COMPENSATION COMMITTEE

Amy Banse, Chair
Melanie Boulden
Laura Desmond
David Ricks

2021 Proxy Statement | 49

Summary Compensation Table for Fiscal Years 2020, 2019 and 2018
The following table sets forth information regarding the compensation for services performed during fiscal years 2020, 2019 and 2018 awarded to, paid to, or earned by the NEOs, which include (1) our Chief Executive Officer, (2) our Chief Financial Officer, and (3) our three other most highly compensated executive officers, as determined by reference to total compensation for fiscal year 2020, who were serving as executive officers at the end of fiscal year 2020.
Name and Principal PositionYearSalary
($)
Bonus
($)
Stock
Awards
(1)
($)
Non-Equity
Incentive Plan
Compensation
(2)
($)
All Other
Compensation
(3)
($)
Total
($)
Shantanu Narayen
2020$1,000,000 $— $42,582,476 $2,094,000 $213,478 $45,889,954 
Chairman, President, and Chief Executive Officer20191,000,000 — 37,025,873 950,000 169,758 39,145,631 
20181,000,000 — 25,539,764 1,824,313 33,451 28,397,528 
John Murphy2020638,462 — 8,577,610 668,038 9,378 9,893,488 
Executive Vice President and Chief Financial Officer
2019575,000 — 6,604,661 273,125 9,205 7,461,991 
2018532,115 — 6,620,002 469,415 200,011 7,821,543 
Scott Belsky2020613,462 — 8,577,610 641,863 8,790 9,841,725 
Chief Product Officer and Executive Vice President, Creative Cloud
2019550,000 — 6,604,661 261,250 8,634 7,424,545 
2018545,769 1,250,000 10,193,697 516,758 8,313 12,514,537 
Anil Chakravarthy(4)
2020641,346 3,000,000 18,442,255 675,660 9,283 22,768,544 
Executive Vice President and GM, Digital Experience Business and Worldwide Field Operations
Abhay Parasnis (5)
2020642,307 — 8,577,610 672,209 9,065 9,901,191 
Executive Vice President, Chief Technology Officer, and Chief Product Officer, Document Cloud2019600,000 — 6,604,661 285,000 8,745 7,498,406 
______________________________________
(1)    These amounts do not reflect the actual economic value realized by the NEO. In accordance with SEC rules, this column represents the grant date fair value, computed in accordance with stock-based compensation accounting principles, of performance shares, assuming the probable outcome of related performance conditions, and RSUs. Pursuant to SEC rules, the amounts shown disregard the impact of estimated forfeitures. For additional information on the valuation assumptions, see Part II, Item 8 “Financial Statements and Supplementary Data” of our Fiscal Year 2020 Annual Report on Form 10-K and the Notes to Consolidated Financial Statements at Note 12, “Stock-Based Compensation.” As shown above in the table entitled “Equity Awards Granted by the Committee During Fiscal Year 2020,” performance share awards have a maximum payout of 200% of the target number of shares.
(2)    These amounts consist solely of amounts earned under our Executive Incentive Plans. Such amounts are paid in the subsequent fiscal year.
(3)    For all NEOs, these amounts for fiscal year 2020 include matching contributions under Adobe’s 401(k) Plan and life insurance premiums. For Mr. Narayen, the amounts also include the incremental cost of personal use of our corporate jet, based on variable costs for fuel, crew, catering, security, and airport fees, amounting to $197,322 and the costs of executive health concierge service in lieu of the executive physical and company-offered COVID testing. 

(4)    Mr. Chakravarthy was not a named executive officer in fiscal year 2019 or 2018.
(5)     Mr. Parasnis was not a named executive officer in fiscal year 2018.
50 | Adobe Inc.

CEO Pay Ratio
The fiscal year 2020 annual total compensation of our CEO was $45,889,954 and the annual total compensation of our median compensated employee was $153,916, based on the methodology presented in the Summary Compensation Table. This resulted in a ratio of 298 to 1. For purposes of identifying the median employee, we took into account target annual base salary, target cash incentive bonus, and grant date accounting value of ongoing RSU and performance share awards granted to our employees, excluding Mr. Narayen, as of November 27, 2020. We annualized this compensation for employees who did not work the entire year.
The pay ratio reported above is a reasonable estimate calculated in a manner consistent with SEC rules based on our internal records and the methodology described above. The SEC rules for identifying the median compensated employee and calculating the pay ratio based on that employee’s total annual compensation allow companies to adopt a variety of methodologies, to apply certain exclusions, and to make reasonable estimates and assumptions that reflect their employee populations and compensation practices. Therefore, the pay ratio reported by other companies may not be comparable to the pay ratio reported above, as other companies have different employee populations and compensation practices and may utilize different methodologies, exclusions, estimates, and assumptions in calculating their own pay ratios.
2021 Proxy Statement | 51

Grants of Plan-Based Awards in Fiscal Year 2020
The following table shows all plan-based awards granted to the NEOs during fiscal year 2020. The equity awards granted in fiscal year 2020 identified in the table below are also reported in “Outstanding Equity Awards at 2020 Fiscal Year End.” For additional information regarding incentive plan awards, please refer to the Cash Incentives and Equity Incentives sections of our “Compensation Discussion and Analysis.”
Estimated Future Payouts
Under Non-Equity Incentive
Plan Awards(1)
Estimated Future Payouts
Under Equity Incentive Plan
Awards(2)
All
Other
Stock
Awards:
Number
of
Shares
of
Stock or Units
(3)
(#)
Grant Date
Fair Value of
Stock and
Option Awards
(4)
($)

Name
Grant
Date
Threshold
($)
Target
($)
Maximum
($)
Threshold
(#)
Target
(#)
Maximum
(#)
Shantanu Narayen
$— $2,000,000 $4,000,000 — — — — $— 
1/27/202024,92065,579 131,158 32,706,870 
(5)
1/27/202028,106 9,875,605 
John Murphy
— — 638,050 1,276,100 — — — — — 
1/27/2020— — — 3,834 10,090 20,180 — 5,032,287 
(5)
1/27/2020— — — — — — 10,090 3,545,323 
Scott Belsky— — 613,050 1,226,100 — — — — — 
1/27/2020— — — 3,834 10,090 20,180 — 5,032,287 
(5)
1/27/2020— — — — — — 10,090 3,545,323 
Anil Chakravarthy645,330 1,290,660 — 
1/27/20205,477 14,413 28,826 7,188,340 
(5)
1/9/2020— 33,056 11,253,915 
Abhay Parasnis— — 642,033 1,284,066 — — — — — 
1/27/2020— — — 3,834 10,090 20,180 — 5,032,287 
(5)
1/27/2020— — — — — — 10,090 3,545,323 
    _________________________
(1)    These columns represent awards granted under our Executive Incentive Plan for performance in fiscal year 2020. These columns show the awards that were possible at the threshold, target, and maximum levels of performance. Minimum performance under the Executive Incentive Plan could have resulted in a threshold amount equal to $0. Actual cash incentive awards earned in fiscal year 2020 by the NEOs under the Executive Incentive Plan are shown in the column titled “Non-Equity Incentive Plan Compensation” in the “Summary Compensation Table.”
(2)    These columns represent awards granted under our 2020 Performance Share Program, which was adopted under our 2019 Equity Incentive Plan (the “2019 Plan”). These columns show the awards that are possible at the threshold, target, and maximum levels of performance. If the company does not achieve the threshold performance metric, zero shares will be earned. Because our 2020 Performance Share Program is based on a three-year performance period, none of the performance shares can be earned until the performance period closes at the end of our 2022 fiscal year. See “Equity Awards Granted by the Committee During Fiscal Year 2020” in the “Compensation Discussion and Analysis” section of this proxy statement for additional discussion.
(3)    This column represents awards of RSUs granted under our 2019 Plan.
(4)    These amounts do not reflect the actual economic value realized by the NEO. In accordance with SEC rules, this column represents the grant date fair value, computed in accordance with stock-based compensation accounting principles, of each equity award. For additional information on the valuation assumptions, see Part II, Item 8 “Financial Statements and Supplementary Data” of our Fiscal Year 2020 Annual Report on Form 10-K and the Notes to Consolidated Financial Statements at Note 12, “Stock-Based Compensation.”
(5)    The grant date fair value included in this column for awards granted under our 2020 Performance Share Program is based on the probable outcome of the performance conditions associated with these grants determined as of the grant date, excluding the effect of estimated forfeitures.
52 | Adobe Inc.

Narrative Summary to Summary Compensation Table and Grants of Plan-Based Awards in Fiscal Year 2020 Table
The material terms of the NEOs’ annual compensation, including base salaries, the Executive Incentive Plan, the 2020 Performance Share Program, the time-based RSUs and the explanations of the amounts of salary, cash incentives, and equity values in proportion to total compensation are described under “Compensation Discussion and Analysis” in this proxy statement. Our equity award granting practices are described above and our severance benefits are described under “Change of Control” in this proxy statement. None of our NEOs have entered into a written employment agreement with Adobe.
As discussed in greater detail in “Compensation Discussion and Analysis,” the fiscal year 2020 non-equity incentive awards were granted pursuant to the Executive Incentive Plan, with amounts earned based on the achievement of certain financial and strategic objective goals, as well as the individual performance applicable to each respective NEO. Cash incentives were fully vested when earned.
As discussed in greater detail in “Compensation Discussion and Analysis,” the fiscal year 2020 performance share awards will be settled in stock, subject to the terms of our 2020 Performance Share Program. Actual awards earned under the 2020 Performance Share Program will be determined based on the results achieved with respect to the three-year performance period, as certified by the Committee at the outset of our 2023 fiscal year, contingent upon each NEO’s continued service to Adobe.
The RSUs granted to our NEOs pursuant to our 2019 Plan at the outset of fiscal year 2020 vest over four years with 25% vesting on the first anniversary of the vesting commencement date, and then 6.25% vesting quarterly thereafter for the remaining three years of the grant subject to continued service through each applicable vesting date.
There is no purchase price associated with performance share or RSU awards. We did not pay dividends on our common stock during fiscal year 2020.
Effect of Death and Disability on Equity Compensation Awards
The terms and conditions of our RSU awards provide that if a recipient’s employment is terminated due to death or disability, the recipient will be given credit for an additional 12 months of service, resulting in vesting for the applicable award accelerating by 12 months.
The terms and conditions of our performance share awards granted in fiscal years 2018, 2019 and 2020 (which vest upon the later of the certification of the performance goals and the third anniversary of the grant date) provide that if a recipient’s employment is terminated due to death or disability before certification of the performance goals, the recipient will receive a prorated target award based on the number of months of service provided during the performance period.
2021 Proxy Statement | 53

Outstanding Equity Awards at 2020 Fiscal Year End
The following table sets forth information regarding outstanding equity awards as of November 27, 2020 for each NEO. All vesting is contingent upon continued employment with Adobe through the applicable vesting date and certain equity awards are subject to performance conditions, each as specified in the footnotes. Market values and payout values in this table are calculated based on the closing market price of our common stock as reported on Nasdaq on November 27, 2020, which was $477.03 per share. No stock options were outstanding as of November 27, 2020.
Stock Awards
NameNumber of Shares or Units of Stock That Have Not Vested
(#)
Market Value of Shares or Units of Stock That Have
Not Vested
($)
Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested
(#)
Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested
($)
Shantanu Narayen20,448 (1)$9,754,309 — $— 
— — 122,690 (2)58,526,811
23,202 (3)11,068,050 — — 
— — 123,742 (4)59,028,646 
— — 61,872 (4)29,514,800 
28,106 (5)13,407,405 — 
— — 131,158 (6)62,566,301 
John Murphy5,750 (7)2,742,923 — — 
1,278 (1)609,644 — — 
— — 7,670 (2)3,658,820
11,460 (8)5,466,764 — — 
6,961 (3)3,320,606 — — 
— — 24,750 (4)11,806,493 
10,090 (5)4,813,233 — — 
— — 20,180 (6)9,626,465 
Scott Belsky14,216 (9)6,781,458 — 
— — 25,560 (2)12,192,887 
6,961 (3)3,320,606 — — 
— — 24,750 (4)11,806,493 
10,090 (5)4,813,233 — — 
— — 20,180 (6)9,626,465 
Anil Chakravarthy33,056 (10)15,768,704 — — 
— — 28,826 (6)13,750,867 
Abhay Parasnis5,113 (1)2,439,054 — — 
— — 30,680 (2)14,635,280 
6,961 (3)3,320,606 — — 
— — 24,750 (4)11,806,493 
10,090 (5)4,813,233 — — 
— — 20,180 (6)9,626,465 
_________________________
(1)    RSUs granted pursuant to our 2003 Plan. Three-year vesting with 1/3 vesting on each anniversary of the grant date. RSUs fully vested on January 24, 2021.
(2)    These amounts represent the maximum number of shares that could be earned under our 2018 Performance Share Program. The performance period ended at the end of fiscal year 2020, and certification was completed thereafter.
54 | Adobe Inc.

The awards fully vested on January 24, 2021. See the discussion in the “Compensation Discussion and Analysis” section of this proxy statement for actual achievement amounts.
(3)    RSUs granted pursuant to our 2003 Plan. Four-year vesting with 25% vesting on the first anniversary of the vesting commencement date, and then 6.25% vesting quarterly thereafter for the remaining three years of the grant. RSUs fully vest on January 24, 2023.
(4)    These amounts represent the maximum number of shares that could be earned under our 2019 Performance Share Program. The performance period will end at the end of fiscal year 2021, and the certification will be completed thereafter. The awards will fully vest as of the later of January 24, 2022 or the certification date.
(5)    RSUs granted pursuant to our 2019 Plan. Four-year vesting with 25% vesting on the first anniversary of the vesting commencement date, and then 6.25% vesting quarterly thereafter for the remaining three years of the grant. RSUs fully vest on January 24, 2024.
(6)    These amounts represent the maximum number of shares that could be earned under our 2020 Performance Share Program. The performance period will end at the end of fiscal year 2022, and the certification will be completed thereafter. The awards will fully vest as of the later of January 24, 2023 or the certification date.
(7)    RSUs granted pursuant to our 2003 Plan. Four-year vesting with 25% vesting on each anniversary of the grant date. RSUs fully vest on March 20, 2021.
(8)    RSUs granted pursuant to our 2003 Plan. Four-year vesting with 25% vesting on each anniversary of the grant date. RSUs fully vest on April 9, 2022.
(9)    RSUs granted pursuant to our 2003 Plan. Three-year vesting with 1/3 vesting on each anniversary of the grant date. RSUs fully vested on December 6, 2020.
(10)    RSUs granted pursuant to our 2019 Plan. Three-year vesting with 1/3 vesting on each anniversary of the grant date. RSUs fully vest on January 9, 2023.
Option Exercises and Stock Vested in Fiscal Year 2020
The following table sets forth information regarding the vesting during fiscal year 2020 of time-based stock-settled RSUs, and performance-based stock-settled awards granted under our 2017 Performance Share Program for each of the NEOs, on an aggregate basis. In January 2020, the Committee certified the results of our 2017 Performance Share Program at 200% of target. Because certification occurs in the year following the end of the three-year performance period, none of the awards under our 2018, 2019, or 2020 Performance Share Programs were eligible to be earned or vest in 2020.
The value realized on vesting of stock awards is based on the closing market price of our common stock as reported on Nasdaq on the vesting date of the stock-settled awards.
Option AwardsStock Awards
NameNumber of
Shares Acquired
on Exercise
(#)
Value Realized
on Exercise
($)
Number of
Shares Acquired
on Vesting
(#)
Value Realized
on Vesting
($)
Shantanu Narayen— $— 236,780 $83,735,675 
John Murphy— — 18,172 6,037,264 
Scott Belsky— — 19,631 6,417,529 
Anil Chakravarthy(1)
— — — — 
Abhay Parasnis— — 65,605 23,213,168 
_________________________

(1)    Mr. Chakravarthy joined in January 2020 and has not vested any shares.
2021 Proxy Statement | 55

Nonqualified Deferred Compensation in Fiscal Year 2020
We originally adopted a Deferred Compensation Plan in December 2006, which has been amended from time to time and most recently in December 2019 to remove the ability of executive officer participants who are not directors to defer performance shares or RSUs granted after December 31, 2019. Under the terms of our Deferred Compensation Plan, eligible employees, including each of the NEOs, and directors may elect to defer the receipt of their cash compensation, and directors may elect to defer the receipt of a portion of equity compensation, they would otherwise have received when earned. Amounts deferred under the Deferred Compensation Plan are deemed invested in the investment funds selected by the participant with similar options as available under the 401(k) Plan. We do not contribute to the Deferred Compensation Plan on behalf of its participants, or match the deferrals made by participants, with the exception of situations in which an election to defer under the Deferred Compensation Plan would prevent a participant from receiving the full 401(k) company match. In those situations, we make a contribution to the Deferred Compensation Plan equal to the foregone 401(k) company match. Accordingly, amounts payable under the Deferred Compensation Plan generally are entirely determined by participant contributions and fund elections.
Participants in the Deferred Compensation Plan may elect to contribute 5% to 75% of their base salary and 5% to 100% of other specified compensation, including commissions and bonuses. Members of our Board may contribute 100% per vesting tranche of their RSU awards. Generally, participants may elect the payment of benefits with respect to cash and equity deferrals to begin on a specified date or upon termination of employment. Payment of cash deferrals may be made in the form of a lump sum or annual installments, subject to certain requirements. Payments of equity deferrals may only be made in the form of a lump sum. In addition, each participant elects whether to keep his or her account balance in the Deferred Compensation Plan or to receive a lump sum distribution upon a change of control. If a participant experiences an unforeseeable emergency during the deferral period, the participant may petition to receive a partial or full payout from the Deferred Compensation Plan. All distributions are made in cash, except that deferred RSUs are settled in Adobe stock.
Other than Mr. Narayen, no other NEOs participated in, or had an accrued balance under, the Deferred Compensation Plan in fiscal year 2020. The following table shows accrued balances under the Deferred Compensation Plan as of the last day of our 2020 fiscal year:
Nonqualified Deferred Compensation(1)
Name
Aggregate balance at November 29, 2019
($)
Executive contributions in fiscal 2020
($)
Registrant contributions in fiscal 2020
($)
Aggregate earnings fiscal 2020
($)
Aggregate withdrawals/distributions in fiscal 2020
($)
Aggregate balance at November 27, 2020
($)
Shantanu Narayen$5,214,655 $907,694 $— $694,764 $— $6,817,113 
_________________________
(1)    Executive contribution amounts in this table are reflected in the Summary Compensation table for fiscal year 2020 and were reflected in prior years, as applicable. Aggregate earnings are not reflected in the Summary Compensation Table for fiscal year 2020 and were not reflected in prior years.
Change of Control
Each of the NEOs is eligible to receive severance benefits in the event of certain terminations of employment upon or after a change of control of Adobe, pursuant to the terms of our Change of Control Plan applicable to each of our current NEOs or, in the case of our Chief Executive Officer, upon or after a change of control of Adobe, in some cases whether or not his employment is terminated, pursuant to his Retention Agreement. Mr. Narayen would need to waive all benefits under his Retention Agreement to receive any benefits under the Change of Control Plan.
The terms of the Change of Control Plan are described below.
Change of Control Terms
Change of Control Plan. Each of our NEOs is an eligible participant in our 2020 Change of Control Plan. The Change of Control Plan will expire on December 13, 2023, unless extended by Adobe. If a change of control occurs prior to its
56 | Adobe Inc.

expiration, the Change of Control Plan will terminate following the later of the date which is twelve months after the occurrence of a change of control or the payment of all severance benefits due under the Change of Control Plan.
Pursuant to the Change of Control Plan, if there is a qualifying change of control of Adobe (as defined in the plan), and within three months prior and twelve months following the change of control, one of our NEOs (other than Mr. Narayen) experiences a separation from service as a result of Adobe (or any successor) terminating his employment without cause (and not due to death or disability), or if he resigns for good reason, such executive officer would be eligible to receive:
twenty-four months of salary and target bonus;
a lump sum payment equal to eighteen months of COBRA premiums for the eligible executive and covered dependents; and
accelerated vesting of all outstanding equity awards (including, for performance shares, solely to the extent shares are credited to the executive based upon performance achieved as of the change of control).
In the event that any amount under the Change of Control Plan would constitute an excess parachute payment within the meaning of Section 280G of the Code, the amounts payable will not exceed the amount which produces the greatest after-tax benefit to the affected individual. All of the benefits under the Change of Control Plan are conditioned upon the executive officer signing a release of claims.
Chief Executive Officer Retention Agreement. Effective January 12, 1998, Adobe entered into a Retention Agreement with Mr. Narayen, which has been amended three times: the first time effective February 11, 2008, based on his promotion to Chief Executive Officer, and the second and third times on December 17, 2010 and December 5, 2014, respectively, both times in order to clarify the manner of compliance with, or exemption from, Section 409A of the Code, in light of updates to, and interpretations of, applicable tax regulations.
Pursuant to his Retention Agreement, if there is a qualifying change of control of Adobe (as defined in the agreement), and prior to or within two years following the change of control, Mr. Narayen experiences a separation from service as a result of Adobe (or any successor) terminating his employment without cause, or as a result of a disability, or if he resigns for good reason, Mr. Narayen would be eligible to receive:    
thirty-six months of salary and target bonus;
pro-rata target bonus for the fiscal year of termination based on the base salary then in effect; and
COBRA premiums for him and covered dependents until the earlier of (1) the last month in which he and his covered dependents are eligible for and enrolled in COBRA coverage and (2) thirty-six months.
    Upon a change of control, regardless of whether his employment is terminated, Mr. Narayen would be eligible to receive accelerated vesting of all outstanding equity awards (including, for performance shares, solely to the extent shares are credited to him based upon performance achieved at the change of control) and any stock options would become fully exercisable.
In the event that any amount under Mr. Narayen’s Retention Agreement would constitute an “excess parachute payment” within the meaning of Section 280G of the Code, the amounts payable will not exceed the amount which produces the greatest after-tax benefit to Mr. Narayen. All benefits provided under the Retention Agreement are conditioned upon him signing a release of claims. The Retention Agreement has no expiration date.
2019 and 2003 Plans
    In the event of a “Change of Control” (as defined in the 2003 Plan and the 2019 Plan, “COC”), the surviving, continuing successor or purchasing entity or its parent may, without the consent of any participant, either assume Adobe’s rights and obligations under outstanding awards or substitute substantially equivalent equity awards. If the acquiring entity elects not to do so, then all unexercised and unvested portions of all outstanding awards will become immediately exercisable and vested in full. Any awards which are not assumed or replaced in connection with a Change of Control or exercised prior to the Change of Control will terminate effective as of the time of the Change of Control.
2021 Proxy Statement | 57

    Equity awards granted to non-employee directors generally provide under the applicable award agreements that the awards will fully accelerate immediately prior to the effective date of a Change of Control, subject to the consummation of the Change of Control. We have provided, and may provide in the future, additional benefits upon a Change of Control or other similar transactions. For example, our executive officers are either covered by the Change of Control Plan or, with respect to Mr. Narayen, his Retention Agreement, which provide for certain acceleration benefits applicable to equity compensation awards in the event of a Change of Control (see “Compensation Discussion and Analysis—Other Benefits and Programs—Severance and Change of Control Compensation” and “Executive Compensation—Change of Control” contained in this proxy statement for more information).
Performance Share Programs
Pursuant to our Performance Share Programs in 2018, 2019 and 2020, in the event of a change of control prior to the certification date, the performance period will be shortened and the Committee will determine the level of achievement and the number of shares credited as of immediately prior to the date of the change of control, but the applicable time-based service vesting requirements will continue to apply. The Change of Control Plan and Mr. Narayen’s Retention Agreement, as applicable, provide for acceleration of the applicable time-based service vesting requirements under our Performance Share Programs for the awards held by the NEOs, as described above.
Potential Payments upon Termination and/or a Change of Control
The following table sets forth the estimated potential payments and benefits payable to each NEO under the Change of Control Plan (as in effect on November 27, 2020), and in the case of Mr. Narayen, his Retention Agreement, in the event of a termination of employment and/or a COC, as if such termination or COC event had occurred on November 27, 2020, the last day of fiscal year 2020. The value of the equity awards is based on the closing market price of our common stock as reported on Nasdaq on November 27, 2020, which was $477.03 per share. Each NEO must sign a release of claims to receive any of the benefits below except those for Death/Disability, COC Only (continued employment), or COC Only/Equity Not Assumed or Substituted.
Triggering Event
Target
Bonus (1)
($)
Lump
Sum
Severance
(2)
($)
Accelerated
Performance
Awards (3)
($)
Accelerated
Restricted
Stock
Units
($)
Cont. Health
Insurance
Coverage
(pres. val.)(4)
($)
Total (5)
($)
Shantanu Narayen
Death/Disability(6)
$— $— $69,205,604 $20,539,003 $— $89,744,607 
Voluntary Termination/Involuntary Termination with Cause
— — — — — — 
Involuntary Termination Without Cause/Resignation for Good Reason
— — — — — — 
Involuntary Termination/Resignation for Good Reason upon COC(7)
2,000,000 9,000,000 104,818,278 34,229,765 30,786 150,078,829 
COC Only (continued employment)(8)
— — 104,818,278 34,229,765 — 139,048,043 
COC Only/Equity Not Assumed or Substituted(9)
— — 104,818,278 34,229,765 — 139,048,043 
John Murphy
Death/Disability(6)
— — 7,369,160 9,667,013 — 17,036,173 
Voluntary Termination/Involuntary Termination with Cause
— — — — — — 
Involuntary Termination Without Cause/Resignation for Good Reason
— — — — — — 
Involuntary Termination/Resignation for Good Reason upon COC(7)
638,050 2,600,000 (10)12,545,889 16,953,169 15,085 32,752,193 
COC Only (continued employment)(8)
— — — — — — 
COC Only/Equity Not Assumed or Substituted(9)
— — 12,545,889 16,953,169 — 29,499,058 
58 | Adobe Inc.

Triggering Event
Target
Bonus (1)
($)
Lump
Sum
Severance
(2)
($)
Accelerated
Performance
Awards (3)
($)
Accelerated
Restricted
Stock
Units
($)