DEF 14A 1 d820675ddef14a.htm DEF 14A DEF 14A
Table of Contents

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the

Securities Exchange Act of 1934

(Amendment No.     )

 

 

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

Check the appropriate box:

 

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

 

MANPOWERGROUP INC.

(Name of registrant as specified in its charter)

 

 

(Name of person(s) filing proxy statement, if other than the registrant)

Payment of Filing Fee (Check the appropriate box):

 

No fee required.

 

Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

 

  (1)

Title of each class of securities to which the transaction applies:

 

          

 

  (2)

Aggregate number of securities to which the transaction applies:

 

          

 

  (3)

Per unit price or other underlying value of the transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):

 

          

 

  (4)

Proposed maximum aggregate value of the transaction:

 

          

 

  (5)

Total fee paid:

 

          

 

 

Fee paid previously with preliminary materials.

 

Check box if any part of the fee is offset as provided by Exchange Act Rule 240.0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

 

  (1)

Amount Previously Paid:

 

          

 

  (2)

Form, Schedule or Registration Statement No.:

 

          

 

  (3)

Filing Party:

 

          

 

  (4)

Date Filed:

 

          

 

 

 

 


Table of Contents

LOGO


Table of Contents

MANPOWERGROUP INC.

100 MANPOWER PLACE

MILWAUKEE, WISCONSIN 53212

Notice of Annual Meeting of Shareholders

 

  May 8, 2020    International Headquarters of ManpowerGroup    Record Date  
  9:00 a.m. CDT    100 Manpower Place    The close of business  
     Milwaukee, Wisconsin 53212    February 28, 2020  

Items of Business:

 

(1)

To elect eleven individuals nominated by the Board of Directors of ManpowerGroup to serve until 2021 as directors;

 

(2)

To ratify the appointment of Deloitte & Touche LLP as our independent auditors for 2020;

 

(3)

To hold an advisory vote on approval of the compensation of our named executive officers;

 

(4)

To approve the amendment and restatement of the 2011 Equity Incentive Plan of ManpowerGroup Inc.; and

 

(5)

To transact such other business as may properly come before the meeting.

Holders of a majority of the outstanding shares must be present in person or by proxy in order for the annual meeting to be held. As allowed under the Securities and Exchange Commission’s rules, we have elected to furnish our proxy materials over the Internet. Accordingly, we have mailed to our shareholders of record and beneficial owners a Notice of Internet Availability of Proxy Materials (the “Notice”) containing instructions on how to access the attached proxy statement and our annual report on Form 10-K via the Internet and how to vote online.

Whether or not you expect to attend the annual meeting in person, you are urged to vote by a telephone vote, by voting electronically via the Internet or, as applicable, by completing and mailing the proxy card. Instructions for telephonic voting and electronic voting via the Internet are contained in the Notice or, as applicable, on the accompanying proxy card. If you attend the meeting and wish to vote your shares personally, you may do so by revoking your proxy at any time prior to the voting thereof. In addition, you may revoke your proxy at any time before it is voted by advising the Secretary of ManpowerGroup in writing (including executing a later-dated proxy or voting via the Internet) or by telephone of such revocation.

 

Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting of Shareholders to be held on May 8, 2020: The annual report on Form 10-K and proxy statement of ManpowerGroup are available for review on the Internet. Instructions on how to access and review the materials on the Internet can be found on the Notice and the accompanying proxy card.

Richard Buchband, Secretary

March 11, 2020


Table of Contents

 

Table of Contents  

 

 

Table of Contents

 

CORPORATE GOVERNANCE DOCUMENTS

     2  
          

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS

     3  
          

PROPOSAL 1. ELECTION OF DIRECTORS

     4  

Director Nominee Biographies

     5  

Board Independence and Related Party Transactions

     11  

Meetings and Committees of the Board

     12  

Board Composition and Qualifications of Board Members

     15  

Board Diversity and Tenure

     16  

Board Leadership Structure

     16  

Board Effectiveness and Evaluation

     17  

Board Oversight of Risk

     18  

Compensation Consultant

     19  
          

BENEFICIAL OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS

     21  
          

COMPENSATION DISCUSSION AND ANALYSIS

     23  
          

REPORT OF THE EXECUTIVE COMPENSATION AND HUMAN RESOURCES COMMITTEE OF THE BOARD OF DIRECTORS

     52  
          

EXECUTIVE COMPENSATION AND HUMAN RESOURCES COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

     52  
          

COMPENSATION POLICIES AND PRACTICES AS THEY RELATE TO RISK MANAGEMENT

     53  
          

COMPENSATION TABLES

     54  

Summary Compensation Table

     54  

All Other Compensation in 2019

     55  

Grants of Plan-Based Awards in 2019

     56  

Compensation Agreements and Arrangements

     56  

2019 Annual Incentive Award Calculations

     57  

Grants Under the 2011 Equity Incentive Plan

     60  

Outstanding Equity Awards at December 31, 2019

     61  

Option Exercises and Stock Vested in 2019

     63  

Nonqualified Deferred Compensation in 2019

     64  

Termination of Employment and Change of Control Arrangements

     66  

Post-Termination and Change of Control Benefits

     69  

Director Compensation for 2019

     74  

Non-Employee Director Stock Ownership Guidelines

     77  
          

CEO PAY RATIO

     78  
          

AUDIT COMMITTEE REPORT

     79  
          

PROPOSAL 2. RATIFICATION OF INDEPENDENT AUDITORS

     82  
          

PROPOSAL 3. ADVISORY VOTE ON APPROVAL OF THE COMPENSATION OF NAMED EXECUTIVE OFFICERS

     83  
          

PROPOSAL 4. APPROVAL OF THE AMENDMENT AND RESTATEMENT OF THE 2011 EQUITY INCENTIVE PLAN OF MANPOWERGROUP INC.

     85  
          

SUBMISSION OF SHAREHOLDER PROPOSALS

     99  
          

OTHER VOTING INFORMATION

     99  
          

OTHER MATTERS

     99  
          

APPENDIX A-1

     A-1  
          

APPENDIX B-1

     B-1  
          


Table of Contents

MANPOWERGROUP INC.

100 Manpower Place

Milwaukee, Wisconsin 53212

March 11, 2020

Proxy Statement

This proxy statement relates to the solicitation of proxies by the board of directors of ManpowerGroup Inc. for use at the annual meeting of shareholders to be held at 9:00 a.m., local time, on May 8, 2020 or at any postponement or adjournment of the annual meeting, for the purposes set forth in this proxy statement and in the accompanying notice of annual meeting of shareholders. The annual meeting will be held at ManpowerGroup’s International Headquarters, 100 Manpower Place, Milwaukee, Wisconsin.

Under rules adopted by the Securities and Exchange Commission, ManpowerGroup is making this proxy statement and other annual meeting materials available on the Internet instead of mailing a printed copy of these materials to each shareholder. Shareholders who received a Notice of Internet Availability of Proxy Materials (the “Notice”) by mail will not receive a printed copy of these materials other than as described below. Instead, the Notice contains instructions as to how shareholders may access and review all of the important information contained in the materials on the Internet, including how shareholders may submit proxies by telephone or over the Internet.

If you received the Notice by mail and would prefer to receive a printed copy of ManpowerGroup’s proxy materials, please follow the instructions for requesting printed copies included in the Notice.

The expense of this solicitation will be paid by us. No solicitation other than by mail and via the Internet is contemplated, except that our officers or employees may solicit the return of proxies from certain shareholders by telephone. In addition, we have retained Innisfree M&A Incorporated to assist in the solicitation of proxies for a fee of approximately $15,000 plus expenses.

Only shareholders of record at the close of business on February 28, 2020 are entitled to notice of and to vote the shares of our common stock, $.01 par value, registered in their name at the annual meeting. As of the record date, we had outstanding 58,678,924 shares of common stock. The presence, in person or by proxy, of a majority of the shares of the common stock outstanding on the record date will constitute a quorum at the annual meeting. Abstentions and broker non-votes, which are proxies from brokers or nominees indicating that such persons have not received instructions from the beneficial owners or other persons entitled to vote shares, will be treated as present for purposes of determining the quorum. Each share of common stock entitles its holder to cast one vote on each matter to be voted upon at the annual meeting. With respect to the proposals to elect the individuals nominated by our Board of Directors to serve as directors for one year, to ratify the appointment of Deloitte & Touche LLP as our independent auditors for 2020, the advisory vote on approval of the compensation of our named executive officers, and to approve the amendment and restatement of the 2011 Equity Incentive Plan of ManpowerGroup Inc., broker non-votes will not be counted as voting on the proposals and abstentions will not be counted as voting on the proposals except that in accordance with the rules of the New York Stock Exchange abstentions will be counted as voting on the proposal to approve the amendment and restatement of the 2011 Equity Incentive Plan of ManpowerGroup Inc.

The Notice is being mailed to shareholders commencing on or about March 26, 2020.

If a proxy is properly submitted to us and not revoked, it will be voted in accordance with the instructions contained in the proxy. Each shareholder may revoke a previously granted proxy at any time before it is exercised by advising the secretary of ManpowerGroup in writing (either by submitting a duly executed proxy bearing a later date or voting by telephone or via the Internet) or by telephone of such revocation. Attendance at the annual meeting will not, in itself, constitute revocation of a proxy. Unless otherwise directed, all proxies will be voted for the election of each of the individuals nominated by our board of directors to serve as directors for one year, will be voted for the appointment of Deloitte & Touche LLP as our independent auditors for 2020, will be voted for approval of the compensation of our named executive officers, and will be voted for the amendment and restatement of the 2011 Equity Incentive Plan of ManpowerGroup Inc.

 

   | ManpowerGroup


Table of Contents

 

  Corporate Governance Documents

 

 

Corporate Governance Documents

Certain documents relating to corporate governance matters are available in print by writing to Richard Buchband, Secretary, ManpowerGroup Inc., 100 Manpower Place, Milwaukee, Wisconsin 53212 and on ManpowerGroup’s website at http://investor.manpowergroup.com/governance. These documents include the following:

 

   

Amended and restated articles of incorporation;

 

   

Amended and restated bylaws;

 

   

Corporate governance guidelines;

 

   

Code of business conduct and ethics;

 

   

Charter of the nominating and governance committee, including the guidelines for selecting board candidates;

 

   

Categorical standards for relationships deemed not to impair independence of non-employee directors;

 

   

Charter of the audit committee;

 

   

Independent auditor services policy;

 

   

Charter of the executive compensation and human resources committee;

 

   

Executive officer stock ownership guidelines;

 

   

Outside director stock ownership guidelines;

 

   

Insider trading policy; and

 

   

Anti-corruption policy.

Information contained on ManpowerGroup’s website is not deemed to be a part of this proxy statement.

 

2020 Proxy Statement | 2   


Table of Contents

 

Security Ownership of Certain Beneficial Owners  

 

 

Security Ownership of Certain Beneficial Owners

The following table lists as of the record date (except as noted below) information as to the persons believed by us to be beneficial owners of more than 5% of our outstanding common stock:

 

     

Name and Address of

Beneficial Owners

  

Amount and Nature of

Beneficial Ownership

 

  Percent of  

  Class(1)  

BlackRock, Inc.

55 East 52nd Street

New York, New York 10055

       6,605,580 (2)       11.3 %

Vanguard Group, Inc.

100 Vanguard Boulevard

Malvern, PA 19355

       5,513,874 (3)       9.4 %

 

(1)

Based on 58,678,924 shares of common stock outstanding as of the record date.

 

(2)

This information is based on a Schedule 13G filed on February 4, 2020 by BlackRock, Inc. on its behalf and on behalf of its following affiliates: BlackRock Life Limited, BlackRock International Limited, BlackRock Advisors, LLC, BlackRock (Netherlands) B.V., BlackRock Fund Advisors, BlackRock Institutional Trust Company, National Association, BlackRock Asset Management Ireland Limited, BlackRock Financial Management, Inc., BlackRock Japan Co., Ltd., BlackRock Asset Management Schweiz AG, BlackRock Investment Management, LLC, BlackRock Investment Management (UK) Limited, BlackRock Asset Management Canada Limited, BlackRock (Luxembourg) S.A., BlackRock Investment Management (Australia) Limited, BlackRock Advisors (UK) Limited, BlackRock Asset Management North Asia Limited, BlackRock (Singapore) Limited and BlackRock Fund Managers Ltd. According to this Schedule 13G, these securities are owned of record by BlackRock, Inc. BlackRock, Inc. has sole voting power with respect to 5,947,576 shares held and sole dispositive power with respect to 6,605,580 shares held.

 

(3)

This information is based on a Schedule 13G filed on February 12, 2020. According to this Schedule 13G, these securities are owned by various individual and institutional investors for which Vanguard Group, Inc. (“Vanguard”) serves as investment advisor. Vanguard has sole voting power with respect to 43,457 shares held, shared voting power with respect to 21,645 shares held, sole dispositive power with respect to 5,453,072 shares held and shared dispositive power with respect to 60,802 shares held.

 

   | ManpowerGroup


Table of Contents

 

  1. Election of Directors

 

 

1. Election of Directors

Our articles of incorporation provide that our board of directors will consist of three to fifteen members. Our board of directors currently consists of eleven members. All directors are elected annually to serve until the next annual meeting of shareholders and until the directors’ successors are duly elected and shall qualify.

The board of directors may appoint additional directors, in accordance with our articles of incorporation, based upon the recommendation of the nominating and governance committee and subject to re-election by our shareholders at the next annual meeting of shareholders.

The following individuals are being nominated as directors, each for a one-year term expiring at the 2021 annual meeting of shareholders:

 

Gina R. Boswell    Ulice Payne, Jr.
Cari M. Dominguez    Jonas Prising
William Downe    Paul Read
John F. Ferraro    Elizabeth P. Sartain
Patricia Hemingway Hall    Michael J. Van Handel
Julie M. Howard   

The nominating and governance committee reviewed the qualifications of the directors listed above who are seeking election or re-election and recommended to the board of directors that each be elected or re-elected to serve for an additional one-year term. The board of directors has confirmed the nominations.

In accordance with our articles of incorporation and bylaws, a nominee will be elected as a director if the number of votes cast in favor of the election exceeds the number of votes cast against the election of that nominee. Abstentions and broker non-votes will not be counted as votes cast. If the number of votes cast in favor of the election of a director is less than the number of votes cast against the election of the director, the director is required to tender his or her resignation from the board of directors to the nominating and governance committee. The nominating and governance committee will recommend to the board of directors whether to accept or reject the tendered resignation or whether other action should be taken. Any such resignation will be effective only upon its acceptance by the board of directors. The board of directors will act on the recommendation of the nominating and governance committee and publicly disclose its decision, and the rationale behind its decision, within 90 days from the date of the announcement of the final results of balloting for the election.

 

LOGO    The board of directors recommends you vote FOR the election of each of the nominees listed above.

 

2020 Proxy Statement | 4   


Table of Contents

 

1. Election of Directors  

 

 

Director Nominee Biographies

Gina R. Boswell

 

 

 

LOGO   

Age: 57

Director since: 2007

Committees: Audit, Nominating and Governance

Biographical Information:

President, US Customer Development at Unilever, a global food, personal care and household products company, from May 2017 to October 2019. General Manager, U.K. and Ireland, at Unilever from September 2015 to May 2017. Executive Vice President, Personal Care, at Unilever from 2011 to September 2015. Prior thereto, Ms. Boswell was President, Global Brands, of Alberto-Culver Company, a consumer goods company, from 2008 to July 2011. Prior thereto, Ms. Boswell held several leadership positions, including Senior Vice President and Chief Operating Officer-North America of Avon Products, Inc. from 2005 to 2007 and as an executive with Ford Motor Company from 1999 to 2003. A director of Wolverine World Wide, Inc. since 2013.

 

Qualifications:

Ms. Boswell has significant international, managerial, strategic, operational, global and financial management expertise as a result of the various senior leadership positions she has held at several companies with global operations. Ms. Boswell also brings an important perspective from her service as a director on other public company boards.

Cari M. Dominguez

 

 

 

LOGO   

Age: 71

Director since: 2007

Committees: Executive Compensation and Human Resources

Biographical Information:

President, Dominguez & Associates, a management consulting firm, since January 2007. Prior thereto, Ms. Dominguez held several leadership positions within the United States government as well as in the public and private sectors, including Chair of the U.S. Equal Employment Opportunity Commission (“EEOC”) from 2001 to 2006, Partner, Heidrick & Struggles, a consulting firm, from 1995 to 1998, Director, Spencer Stuart, a consulting firm, from 1993 to 1995, Assistant Secretary for Employment Standards Administration, and Director of the Office of Federal Contract Compliance Programs, U.S. Department of Labor, from 1989 to 1993. A trustee of The Calvert Funds since 2008, director of Triple-S Management Corporation since 2012 and a director with the National Association of Corporate Directors since 2013.

 

Qualifications:

Ms. Dominguez has significant expertise in government relations and labor markets from her position as Chair of the EEOC and other various governmental positions she held. Ms. Dominguez also has managerial, international and operational experience in the human resources industry as a result of the various positions she held at various human resource consulting groups.

 

   | ManpowerGroup


Table of Contents

 

  1. Election of Directors

 

 

William Downe

 

 

 

LOGO   

Age: 67

Director since: 2011

Lead Director since: 2017

Committees: Executive Compensation and Human Resources

Biographical Information:

Non-Executive Chairman of Trans Mountain Corporation, an oil pipeline operator, since November 2018. Chief Executive Officer of BMO Financial Group, a highly diversified financial services provider based in North America, from 2007 to October 2017. Prior thereto, Mr. Downe held several leadership positions with BMO Financial Group and its subsidiaries, including Chief Operating Officer of BMO Financial Group from 2006 to 2007, and Deputy Chair of BMO Financial Group and Chief Executive Officer, BMO Nesbitt Burns and Head of Investment Banking Group from 2001 to 2006. A director of Loblaw Companies Limited since May 2018 and a director of BMO Financial Group from 2007 to October 2017.

 

Qualifications:

Mr. Downe brings to the board significant managerial, operational and global experience he gained during his tenure as Chief Executive Officer of BMO Financial Group and serving on its Board.

John F. Ferraro

 

 

 

LOGO   

Age: 64

Director since: 2016

Committees: Audit

Biographical Information:

Global Chief Operating Officer of Ernst & Young (“EY”), a global professional services organization, from 2007 to January 2015. Prior thereto, Mr. Ferraro held several senior leadership positions at EY, including Global Vice Chair Audit. In addition, Mr. Ferraro served as a member of EY’s Global Executive board for more than 10 years. Mr. Ferraro also served as Executive Vice President, Strategy and Sales of Aquilon Energy Services, a software and services company for the energy industry, from February 2019 to July 2019. A director of Advance Auto Parts since 2015 and International Flavor and Fragrances, Inc. since 2015.

 

Qualifications:

Mr. Ferraro brings to the board significant managerial, operational, financial and global experience he gained during his tenure as Global Chief Operating Officer of EY and the other various positions he held at EY as well as his service as a director on other public company boards.

 

2020 Proxy Statement | 6   


Table of Contents

 

1. Election of Directors  

 

 

Patricia Hemingway Hall

 

 

 

LOGO   

Age: 67

Director since: 2011

Committees: Audit, Nominating and Governance (Chair)

Biographical Information:

President and Chief Executive Officer of Health Care Service Corporation (“HCSC”), a mutual health insurer, from 2008 to December 2015. Prior thereto, Ms. Hemingway Hall held several leadership positions at HCSC, including President and Chief Operating Officer from 2007 to 2008 and Executive Vice President of Internal Operations from 2006 to 2007. A director of Cardinal Health since 2013, Celgene Corporation from April 2018 to November 2019 and Halliburton since February 2019.

 

Qualifications:

Ms. Hemingway Hall brings to the board significant managerial, operational, sales, marketing and government relations, experience from her tenure as President and Chief Executive Officer of HCSC and the other various positions she held at HCSC. Ms. Hemingway Hall also brings an important perspective gained from her service as a director on other public company boards.

Julie M. Howard

 

 

 

LOGO   

Age: 57

Director since: 2016

Committees: Executive Compensation and Human Resources, Nominating and Governance

Biographical Information:

Chief Executive Officer of Navigant Consulting, Inc. (“Navigant”), a specialized global professional services firm, from 2012 to October 2019. Chairman of the Board of Navigant from 2014 to October 2019. Prior thereto, Ms. Howard held several leadership positions at Navigant including Chief Operating Officer. A director of InnerWorkings, Inc. since 2012 and a former director of Kemper Corporation from 2010 to 2015.

 

Qualifications:

Ms. Howard brings to the board significant managerial and operational experience from her tenure as Chief Executive Officer of Navigant and the other various positions she held at Navigant. Ms. Howard also brings an important perspective from serving on other public company boards.

 

   | ManpowerGroup


Table of Contents

 

  1. Election of Directors

 

 

Ulice Payne, Jr.

 

 

 

LOGO   

Age: 64

Director since: 2007

Committees: Audit, Nominating and Governance

Biographical Information:

President and Managing Member of Addison-Clifton, LLC, a provider of global trade compliance advisory services, since May 2004. Prior thereto, Mr. Payne held several leadership positions, including President and Chief Executive Officer of the Milwaukee Brewers Baseball Club from 2002 to 2003 and Partner with the law firm Foley & Lardner LLP from 1998 to 2002. A trustee of The Northwestern Mutual Life Insurance Company since 2005, a director of WEC Energy Group, Inc. (formerly Wisconsin Energy Corporation) since 2003 and Foot Locker, Inc. since 2016.

 

Qualifications:

Mr. Payne brings to the board significant managerial, operational, financial and global experience as a result of many senior positions he has held including as President of Addison-Clifton, LLC. The board of directors also benefits from his broad experience in and knowledge of international business.

Jonas Prising

 

 

 

LOGO   

Age: 55

Director since: 2014

Committees: none

Biographical Information:

Chief Executive Officer of ManpowerGroup since May 2014. Chairman of ManpowerGroup since December 2015. ManpowerGroup President from 2012 to April 2014. Executive Vice President, President of ManpowerGroup - The Americas from 2009 to 2012. Prior thereto, Mr. Prising was the Executive Vice President, President of ManpowerGroup - United States and Canadian Operations from 2006 to 2008 and held other positions at ManpowerGroup since 1999. A director of Kohl’s Corporation since 2015.

 

Qualifications:

Mr. Prising brings to the board a deep knowledge of ManpowerGroup and its operations from his many years of experience with the Company, including as President with responsibility for the Americas and Southern Europe and currently as Chairman and Chief Executive Officer. He also brings a deep understanding of the industry, a global perspective, having lived and worked in multiple countries around the world, and a strong knowledge of the relevant marketplaces in Europe and Asia.

 

2020 Proxy Statement | 8   


Table of Contents

 

1. Election of Directors  

 

 

Paul Read

 

 

 

LOGO   

Age: 52

Director since: 2014

Committees: Audit (Chair)

Biographical Information:

President and Chief Operating Officer of Ingram Micro, Inc., a technology distributor and supply-chain services provider, from 2013 to February 2016. Prior thereto, Mr. Read was Chief Financial Officer of Flextronics International, Ltd., an electronics manufacturing services provider, from 2008 to June 2013.

 

Qualifications:

Mr. Read brings to the board significant managerial, operational, financial and global experience as a result of many senior positions he has held, including his tenure as President and Chief Operating Officer of Ingram Micro, Inc. and Chief Financial Officer of Flextronics International, Ltd.

Elizabeth P. Sartain

 

 

 

LOGO   

Age: 65

Director since: 2010

Committees: Executive Compensation and Human Resources (Chair)

Biographical Information:

Independent Human Resource Advisor and Consultant since April 2008. Prior thereto, Ms. Sartain held several leadership positions, including Executive Vice President and Chief People Officer at Yahoo! Inc. from 2001 to 2008 and an executive with Southwest Airlines serving in various positions from 1988 to 2001. A director of Shutterfly Inc. from December 2016 to September 2019.

 

Qualifications:

Ms. Sartain brings to the board significant human resources experience as a result of the various senior management positions she held at various multi-national companies as well as being an independent human resource advisor for many years. Ms. Sartain also brings an important perspective gained from her service as a director on other public company boards.

 

   | ManpowerGroup


Table of Contents

 

  1. Election of Directors

 

 

Michael J. Van Handel

 

 

 

LOGO   

Age: 60

Director since: 2017

Committees: None

Biographical Information:

Senior Executive Vice President of ManpowerGroup from February 2016 to February 2017. Chief Financial Officer of ManpowerGroup from July 1998 to February 2016. Prior thereto, Mr. Van Handel held several other senior finance and accounting positions within ManpowerGroup since 1989. A director of BMO Financial Corporation, a subsidiary of BMO Financial Group, since 2006 and a Director of ICF International since June 2017. Formerly, a director of Cellular Dynamics International, Inc. from 2010 to 2015.

 

Qualifications:

Mr. Van Handel brings to the board significant managerial, operational, financial and global experience including his time as Chief Financial Officer and the other senior financial positions he held while employed at ManpowerGroup. He also brings deep knowledge of ManpowerGroup and its operations as well as a deep understanding of the industry with his over 20 years of experience at ManpowerGroup. Mr. Van Handel also brings an important perspective gained from his service as a director on other public company boards.

 

 

Each director attended at least 75% of the board meetings and meetings of committees on which he or she served in 2019. The board of directors held six regular meetings during 2019. The board of directors took one action by written consent during 2019.

Under the Company’s corporate governance guidelines, an individual cannot be nominated for election to the board of directors after his or her 72nd birthday. Any director who turns 72 during his or her normal term will continue in office until the expiration of that term.

Under ManpowerGroup’s bylaws, nominations, other than those made by the board of directors or the nominating and governance committee, must be made pursuant to timely notice in proper written form to the Secretary of ManpowerGroup. To be timely, a shareholder’s request to nominate a person for election to the board of directors at an annual meeting of shareholders, together with the written consent of such person to serve as a director, must be received by the Secretary of ManpowerGroup not less than 90 days nor more than 150 days prior to the anniversary of the annual meeting of shareholders held in the prior year. To be in proper written form, the notice must contain certain information concerning the nominee and the shareholder submitting the nomination, including the disclosure of any hedging, derivative or other complex transactions involving the Company’s common stock to which a shareholder proposing a director nomination is a party.

 

2020 Proxy Statement | 10   


Table of Contents

 

1. Election of Directors  

 

 

Board Independence and Related Party Transactions

The board of directors has adopted categorical standards for relationships deemed not to impair independence of non-employee directors to assist it in making determinations of independence. The categorical standards are included in our Corporate Governance Guidelines and are available on ManpowerGroup’s website at http://investor.manpowergroup.com/governance. As required under the Corporate Governance Guidelines, our board of directors reviews and determines the independence of all directors on an annual basis.

In making its independence determinations, the nominating and governance committee evaluates the various commercial and employment transactions and relationships known to the committee that exist between ManpowerGroup and the entities with which certain of our directors or members of their immediate families are, or have been, affiliated. The nominating and governance committee also reviews any other relevant facts and circumstances regarding the nature of these relationships to determine whether other factors, regardless of the categorical standards, might compromise a director’s independence.

The board of directors has determined that ten of eleven of the current directors of ManpowerGroup are independent under the listing standards of the New York Stock Exchange after taking into account the categorical standards. Certain of our directors, serve as directors, and one was formerly an officer, of companies that have engaged ManpowerGroup to provide services, all of which such relationships fall within the categorial standards.

Mr. Van Handel previously served as an executive officer of the company and, as such, did not qualify as independent under the listing rules of the New York Stock Exchange until February 15, 2020. Mr. Prising does not qualify as independent under the listing rules of the New York Stock Exchange because he is currently an executive officer.

The nominating and governance committee will evaluate eligible shareholder-nominated candidates for election to the board of directors in accordance with the procedures described in ManpowerGroup’s bylaws and in accordance with the guidelines and considerations relating to the selection of candidates for membership on the board of directors described under the heading “Board Composition and Qualifications of Board Members.”

ManpowerGroup does not have a policy regarding board members’ attendance at the annual meeting of shareholders. All of the directors attended the 2019 annual meeting of shareholders.

Any interested party who wishes to communicate directly with the lead director or with the non-management directors as a group may do so by calling 1-800-210-3458. The third-party service provider that monitors this telephone number will forward a summary of all communications directed to the non-management directors to the lead director.

 

   11 | ManpowerGroup


Table of Contents

 

  1. Election of Directors

 

 

Meetings and Committees of the Board

The board of directors has standing audit, executive compensation and human resources, and nominating and governance committees. The board of directors has adopted written charters for these committees, which are available on ManpowerGroup’s web site at http://investor.manpowergroup.com/governance.

The following table sets forth the current members of each of the committees and the number of meetings held during 2019:

 

       
        Audit    Executive
Compensation and
Human Resources
   Nominating and
Governance

Gina R. Boswell

          

Cari M. Dominguez

          

William Downe(1)

          

John F. Ferraro

          

Patricia Hemingway Hall

           Chair

Julie M. Howard

          

Ulice Payne, Jr.

          

Paul Read

     Chair      

Elizabeth P. Sartain(1)

          Chair     

Number of Meetings in 2019

     5    6    5

 

(1)

Ms. Sartain became chair of the executive compensation and human resources committee in May 2019, succeeding Mr. Downe. Mr. Downe remains a member of the committee.

Audit Committee

The board of directors has determined that each member of the audit committee meets the financial literacy and independence requirements of the SEC and New York Stock Exchange, as applicable, and that Ms. Boswell, Mr. Ferraro and Mr. Read are each an “audit committee financial expert” as defined under the applicable rules of the SEC. Under the Company’s corporate governance guidelines, no member of the audit committee may serve on the audit committee of more than three public companies, including ManpowerGroup. No member of the audit committee currently serves on the audit committee of more than three public companies, including ManpowerGroup.

The functions of this committee are to:

 

   

appoint the independent auditors for the annual audit and approve the fee arrangements with the independent auditors;

 

   

monitor the independence, qualifications and performance of the independent auditors;

 

   

review the planned scope of the annual audit;

 

   

review the financial statements to be included in our quarterly reports on Form 10-Q and our annual report on Form 10-K, and our disclosures under “Management’s Discussion and Analysis of Financial Condition and Results of Operations” section of those reports;

 

   

review compliance with and reporting under Section 404 of the Sarbanes-Oxley Act of 2002;

 

   

review our financial reporting processes and internal controls and any significant audit adjustments proposed by the independent auditors;

 

   

make a recommendation to the board of directors regarding inclusion of the audited financial statements in our annual report on Form 10-K;

 

   

review recommendations, if any, by the independent auditors resulting from the audit to ensure that appropriate actions are taken by management;

 

   

review matters of disagreement, if any, between management and the independent auditors;

 

2020 Proxy Statement | 12   


Table of Contents

 

1. Election of Directors  

 

 

   

periodically review our Policy Regarding the Retention of Former Employees of Independent Auditors;

 

   

oversee compliance with our Independent Auditor Services Policy;

 

   

meet privately on a periodic basis with the independent auditors, internal audit staff and management to review the adequacy of our internal controls and other finance related matters;

 

   

meet privately with management to review the competence, performance and independence of the independent auditors;

 

   

monitor our internal audit department, including our internal audit plan;

 

   

review guidelines and policies regarding compliance by our employees with our code of business conduct and ethics, including the anti-corruption policy;

 

   

review procedures for receipt, retention and treatment of, and the confidential and anonymous submission of concerns regarding questionable accounting or auditing matters;

 

   

assist the board of directors with its oversight of the performance of the Company’s risk management function;

 

   

review current tax matters affecting us;

 

   

periodically discuss with management our risk management framework;

 

   

monitor any litigation involving ManpowerGroup that may have a material financial impact on ManpowerGroup or that relates to matters entrusted to the audit committee; and

 

   

approve the retention, compensation and termination of outside legal, accounting and other such advisors to the committee.

In addition, the charter of the audit committee provides that the audit committee shall review and approve all related party transactions that are material to ManpowerGroup’s financial statements or that otherwise require disclosure to ManpowerGroup’s shareholders, provided that the audit committee shall not be responsible for reviewing and approving related party transactions that are reviewed and approved by the board of directors or another committee of the board of directors. The audit committee did not take action by written consent during 2019.

Executive Compensation and Human Resources Committee

Each member of the executive compensation and human resources committee is “independent” within the meaning of the applicable listing standards of the New York Stock Exchange.

The functions of this committee are to:

 

   

establish the compensation of the chief executive officer of ManpowerGroup, subject to ratification by the independent members of the board of directors;

 

   

approve the compensation, based on the recommendations of the chief executive officer of ManpowerGroup, of any president and the chief financial officer, and certain other senior executives of ManpowerGroup;

 

   

determine the terms of any agreements concerning employment, compensation or employment termination, as well as monitor the application of ManpowerGroup’s retirement and other fringe benefit plans, with respect to the individuals listed above;

 

   

monitor the professional development of ManpowerGroup’s key executive officers;

 

   

review succession plans for the chief executive officer of ManpowerGroup, of any president and the chief financial officer and certain other senior executives of ManpowerGroup;

 

   

administer ManpowerGroup’s equity incentive plans and employee stock purchase plans and oversee ManpowerGroup’s employee retirement and welfare plans;

 

   

administer ManpowerGroup’s annual incentive plan;

 

   

review and recommend the “Compensation Discussion and Analysis” to be included in our annual proxy statement;

 

   

develop and implement policies regarding the recoupment or “clawback” of excess compensation paid to executive officers of the Company;

 

   13 | ManpowerGroup


Table of Contents

 

  1. Election of Directors

 

 

   

approve the retention, compensation and termination of outside compensation consultants, independent legal advisors or other advisors and have oversight of their work;

 

   

consider the independence of any outside compensation consultant, independent legal advisor or other advisor to the committee;

 

   

monitor the Company’s policies, objectives and programs related to diversity and inclusion and review the Company’s performance in light of appropriate measures; and

 

   

Review the results of any advisory shareholder votes on executive compensation and consider whether to recommend adjustments to the Company’s executive compensation policies and practices as a result of such votes.

In accordance with the terms of its charter, the executive compensation and human resources committee may from time to time delegate authority and assign responsibility with respect to such of its functions to officers of the Company, or to a subcommittee of the committee. The executive compensation and human resources committee took one action by written consent during 2019.

Nominating and Governance Committee

Each member of the nominating and governance committee is “independent” within the meaning of the applicable listing standards of the New York Stock Exchange.

The functions of this committee are to:

 

   

recommend nominees to stand for election at annual meetings of shareholders, to fill vacancies on the board of directors and to serve on committees of the board of directors;

 

   

establish procedures and assist in identifying candidates for board membership;

 

   

review the qualifications of candidates for board membership, including any candidates nominated by shareholders in accordance with our bylaws;

 

   

periodically review the compensation arrangements in effect for the non-management members of the board of directors and recommend any changes deemed appropriate;

 

   

oversee the annual self-evaluation of the performance of the board of directors and each of its committees and oversee, or ensure another committee oversees, the annual evaluation of the performance of management;

 

   

establish and review, for recommendation to the board of directors, guidelines and policies on the size and composition of the board, the structure, composition and functions of the board committees, and other significant corporate governance principles and procedures;

 

   

oversee the content and format of our code of business conduct and ethics and recommend any changes as deemed appropriate;

 

   

monitor compliance by the non-management directors with our code of business conduct and ethics;

 

   

develop and periodically review succession plans for the directors;

 

   

periodically review the corporate governance guidelines and recommend any changes as deemed appropriate;

 

   

review and recommend categorical standards for determining non-management director independence consistent with the rules of the New York Stock Exchange and other requirements;

 

   

Consider and recommend to the Board the action to be taken with respect to any resignation tendered by a director with respect to a change in professional responsibilities or personal circumstances; and

 

   

approve the retention, compensation and termination of any outside independent advisors to the committee.

The nominating and governance committee has from time to time engaged director search firms to assist it in identifying and evaluating potential board candidates. The nominating and governance committee did not take any action by written consent during 2019.

 

2020 Proxy Statement | 14   


Table of Contents

 

1. Election of Directors  

 

 

Board Composition and Qualifications of Board Members

The nominating and governance committee has adopted, and the board of directors has approved, guidelines for selecting board candidates that the committee considers when evaluating candidates for nomination as directors. The guidelines call for the following with respect to the composition of the board:

 

   

a variety of experience and backgrounds;

 

   

a core of business executives having substantial senior management and financial experience;

 

   

individuals who will represent the best interests of the shareholders as a whole rather than special interest constituencies;

 

   

the independence of at least a majority of the directors; and

 

   

individuals who represent a diversity of gender, race and age.

In connection with its consideration of possible candidates for board membership, the committee also has identified areas of experience that members of the board should as a goal collectively possess. The below graphic lists these skills and attributes, and shows which ones each director has identified as being part of his or her own experience. As shown, these skills and attributes are well represented within this group.

 

   

LOGO

 

 

LOGO

 

 

LOGO

 

 

LOGO

 

 

 

LOGO

 

 

LOGO

 

 

LOGO

 

 

LOGO

 

 

LOGO

 

 

LOGO

 

 

LOGO

 

Previous Board

Experience serving as a director of another public company

 

                     

International Business

Experience in diverse geographic, political and regulatory environments

 

                     

Corporate Governance

Supports our goals of strong Board and management accountability

 

                     

Active or Former CEO/Chairperson or other C-Suite Officer

Served in a senior leadership role at a large organization

 

                     

Sales

Experience developing strategies to grow sales and market share

 

                     

Government Relations

Understanding of government regulations affecting our business

 

                     

Human Resources

Experience building knowledge, skills and abilities of employees

 

                     

Marketing and Branding

Experience in a senior management position managing marketing/

branding

 

                     

Technology

Experience with technology, cybersecurity, information systems/data

management or privacy

 

                     

Accounting or Financial Oversight

Experience to provide valuable insight in overseeing finances

 

                     

Operations

Experience with our business, strategy and marketplace dynamics

 

                     

The Company believes that the present composition of the board of director nominees satisfies the guidelines for selecting board candidates set out above; specifically, the nominees include individuals who have a variety of

 

   15 | ManpowerGroup


Table of Contents

 

  1. Election of Directors

 

 

experience and backgrounds, the nominees include a core of business executives having substantial experience in management as well as one member having government experience, and ten of eleven of the nominees are independent under the rules of the New York Stock Exchange as of February 15, 2020. As previously mentioned, Mr. Van Handel previously served as an executive officer of the company and, as such, did not qualify as independent under the listing rules of the New York Stock Exchange until February 15, 2020.

The board of directors and the nominating and governance committee evaluated each of the director nominees’ contributions to the board of directors as well as their role in the operation of the board of directors as a whole. The nominating and governance committee considered both the background and experience of each director nominee as well as the qualifications set forth in the biographies on pages 5 to 10 of this proxy statement.

Board Diversity and Tenure

The composition of the nominees for the board also reflects diversity of gender, race and age, an objective that the nominating and governance committee continually strives to enhance when searching for and considering new directors. Based on the composition of the nominees for our board of directors, we believe this objective has been achieved.

 

LOGO

Board Leadership Structure

Chairman of the Board

Under ManpowerGroup’s bylaws and in accordance with the Company’s corporate governance guidelines, the board of directors can choose whether the roles of chairman and chief executive officer should be combined or separated, based on what it believes is best for the Company and its shareholders at a given point in time. Jonas Prising has been chairman of the board of directors since December 31, 2015. The board of directors has evaluated the Company’s leadership structure and determined that the presence of our independent lead director who, as described below, has meaningful oversight responsibilities, together with a strong leader in the combined

 

2020 Proxy Statement | 16   


Table of Contents

 

1. Election of Directors  

 

 

role of chairman and chief executive officer, serves the best interests of ManpowerGroup and its shareholders. The board of directors believes that in light of Mr. Prising’s extensive knowledge of ManpowerGroup and its industry, gained through his tenure with the Company, he is well positioned to serve as both chairman and chief executive officer of the Company.

Lead Director

The board of directors has selected Mr. Downe, retired CEO of BMO Financial Group, to serve as lead director. Our corporate governance guidelines provide that if the same person holds the chief executive officer and chairman roles or if the chairman is not independent, the board of directors will designate one of the independent directors to serve as the lead director. The lead director helps ensure that there is an appropriate balance between management and the independent directors and that the independent directors are fully informed and able to discuss and debate the issues that they deem important.

Our corporate governance guidelines contemplate that the lead director will be appointed annually and that he or she should be willing to serve for at least three years in such capacity. The board of directors believes having a lead director serving continuous terms provides greater continuity to the role, enhances board leadership and performance and facilitates effective oversight of the performance of senior management. Mr. Downe has served as lead director since May 2017, and at a board meeting in February 2020, the board of directors re-appointed Mr. Downe to serve as lead director for another year.

The lead director’s duties include the following:

 

   

Preside at executive sessions of the non-employee directors;

 

   

Preside at all other meetings of directors where the chairman of the board is not present;

 

   

Serve as liaison between the chairman of the board and the non-employee directors;

 

   

Approve what information is sent to the board;

 

   

Approve the meeting agendas for the board;

 

   

Approve meeting schedules to assure that there is sufficient time for discussion on all agenda items;

 

   

Provide feedback from executive sessions of the independent directors to the Chairman and CEO and other senior management;

 

   

Serve in a key role in the board evaluation processes and in evaluation of the CEO;

 

   

Recommend to the board and the board committees the retention of advisers and consultants who report directly to the board;

 

   

Have the authority to call meetings of the non-employee directors;

 

   

If requested by major shareholders, ensure that he or she is available for consultation and direct communication; and

 

   

Perform such other duties as the board may delegate from time to time.

Board Effectiveness and Evaluation

Our board of directors is committed to performing effectively for the benefit of the Company and its shareholders at both the board and committee level. Each year, the nominating and governance committee oversees the board and committee evaluation process and determines the format and framework for the process.

Annual Evaluation Process

The purpose of the annual evaluation process is to ensure that the board continues to operate at a high level, with an opportunity for self-reflection and improvement. Prior to 2018, we conducted an internal assessment at the board level and at each of the committees, making use of both externally developed questionnaires and internal discussion materials. The responses to the written questionnaires, and the internal discussion materials, formed the basis for a self-evaluation process conducted by each committee, which was then summarized for the full board. The board followed a similar process, conducted by the board in full, regarding its own effectiveness.

 

   17 | ManpowerGroup


Table of Contents

 

  1. Election of Directors

 

 

Independent Consultant

In 2018, we determined to expand the process. The nominating and governance committee engaged a third-party consultant, experienced in corporate governance matters, to assist with the board and committee evaluation process. Directors were interviewed by the independent third party, and gave specific feedback addressing board effectiveness, individual contributions, committee functioning, and similar topics, as well as suggestions to enhance the efficiency and productivity of the board in general. Directors responded to questions designed to elicit this information, and the independent third party synthesized the results and comments received during such interviews. These findings were then presented by the independent third party and the chair of the nominating and governance committee to the nominating and governance committee and to the board, followed by a review and discussion by the full board. Each committee also conducted a committee assessment discussion. The board believes this facilitated process provided additional insight and perspective that it can utilize to further enhance effectiveness, including in areas such as board and committee composition, information flow between management and the board, development of materials for board discussion, focus on corporate strategy and director recruitment.

For 2019, we again engaged with the third-party consultant to assist with the board and committee evaluation process. Directors were interviewed by the independent third party, and gave specific feedback regarding the progress in addressing prior year action items raised during the 2018 evaluation process as well as any new areas of concern. The conversations also focused on committee functioning. Directors responded to questions designed to elicit this information, and the independent third party synthesized the results and comments received during such interviews. These findings were then presented by the independent third party and the chair of the nominating and governance committee to the nominating and governance committee. The chair of the nominating and governance committee then discussed these findings with the full board. She also separately provided any committee findings to each committee chair, which were used to facilitate discussion during each of the committee assessments.

Board Oversight of Risk

The board of directors is responsible for overseeing management in the execution of management’s Company-wide risk management responsibilities. The board of directors fulfills this responsibility both directly and through its standing committees (as discussed further below), each of which assists the board in overseeing a part of the Company’s overall risk management.

The committees of the board oversee specific areas of the Company’s risk management as described below:

Audit Committee

The audit committee is responsible for assisting the board of directors with its oversight of the performance of the Company’s risk management functions including:

 

   

Periodically reviewing and discussing with management the Company’s risk management framework, including policies, practices and procedures regarding risk assessment and management;

 

   

Periodically receiving, reviewing and discussing with management reports on selected risk topics as the committee or management deems appropriate from time to time; and

 

   

Periodically reporting to the board of directors on its activities in this oversight role.

Executive Compensation and Human Resources Committee

The executive compensation and human resources committee reviews and discusses with management the Company’s compensation policies and practices and management’s assessment of whether any risks arising from such policies and practices are reasonably likely to have a material adverse effect on the Company.

Nominating and Governance Committee

The nominating and governance committee evaluates the overall effectiveness of the board of directors, including its focus on the most critical issues and risks.

 

2020 Proxy Statement | 18   


Table of Contents

 

1. Election of Directors  

 

 

As part of this oversight, the committees engage in reviews and discussions with management (and others if considered appropriate) as necessary to be reasonably assured that the Company’s risk management processes (1) are adequate to identify the material risks that we face in a timely manner, (2) include strategies for the management of risk that are responsive to our risk profile and specific material risk exposure, (3) serve to integrate risk management considerations into business decision-making throughout the Company, and (4) include policies and procedures that are reasonably effective in facilitating the transmission of information with respect to material risks to the senior executives of the Company and each committee.

Compensation Consultant

The executive compensation and human resources committee directly retains Mercer (US) Inc. to advise it on executive compensation matters. Mercer reports to the chair of the committee. On an annual basis, the committee and Mercer enter into a statement of work, which sets out the services to be performed by Mercer for the committee during the ensuing year. Mercer’s primary role is to provide objective analysis, advice and information and otherwise to support the committee in the performance of its duties. Mercer’s fees for executive compensation consulting to the committee in 2019 were $348,288.

The committee requests information and recommendations from Mercer as it deems appropriate in order to assist it in structuring and evaluating ManpowerGroup’s executive compensation programs and practices. The committee’s decisions about executive compensation, including the specific amounts paid to executive officers, are its own and may reflect factors and considerations other than the information and recommendations provided by Mercer.

Mercer was engaged by the committee to perform the following services in 2019:

 

   

Review and recommend the companies used in our industry peer group;

 

   

Evaluate the competitiveness of our total executive compensation and benefits program for the senior executives, including base salary, annual incentive, total cash compensation, long-term incentive awards, total direct compensation, perquisites, retirement benefits and total remuneration against the market;

 

   

Assess how well the compensation and benefits programs are aligned with the committee’s stated philosophy to align pay with performance, including analyzing our performance against comparator companies;

 

   

Assess shares available under our equity incentive plan;

 

   

Review and recommend the companies used in our industry peer group;

 

   

Provide advice and assistance to the committee on the levels of total compensation and the principal elements of compensation for our senior executives;

 

   

Advise committee on salary, target incentive opportunities and equity grants as well as on the design and features of our short-term and long-term incentive programs for our senior executives;

 

   

Brief the committee on trends in executive compensation and benefits among large public companies and on regulatory, legislative and other developments; and

 

   

Assist in reviewing the Compensation Discussion and Analysis and other executive compensation disclosures to be included in this proxy statement.

The committee has reviewed whether the work provided by Mercer raises any conflict of interest. Factors considered by the committee include:

 

   

Other services provided to the Company by the consultant;

 

   

What percentage of the consultant’s total revenue is made up of fees from the Company;

 

   

Policies or procedures of the consultant that are designed to prevent a conflict of interest;

 

   

Any business or personal relationships between individual consultants involved in the engagement and committee members;

 

   

Any shares of the Company’s stock owned by individual consultants involved in the engagement; and

 

   19 | ManpowerGroup


Table of Contents

 

  1. Election of Directors

 

 

   

Any business or personal relationships between our executive officers and the consulting firm or the individual consultants involved in the engagement.

Based on its review, the committee does not believe that Mercer has a conflict of interest with respect to the work performed by the Company or the committee in 2019. The committee has also evaluated the independence of Mercer pursuant to the rules of the Securities and Exchange Commission and the New York Stock Exchange and no relationships were identified that would impact Mercer’s independence.

Ultimately, the consultant provides recommendations and advice to the committee in an executive session where management is not present, which is when critical pay decisions are made. This approach protects the committee’s ability to receive objective advice from the consultant so that the committee may make independent decisions about executive pay at our company.

Besides Mercer’s involvement with the committee, it and its affiliates also provide other non-executive compensation services to us. These services are approved by management who oversee the specific areas of business for which the services are provided.

The total amount paid for these other services provided in 2019 was $358,426. These services included a review of the non-employee director compensation program as requested by the nominating and governance committee, actuarial and pension reporting services, workers compensation reporting and insurance services. The majority of these services are provided not by Mercer itself, but by other companies owned by Marsh & McLennan, the parent company of Mercer, which therefore are considered affiliates even though they operate independently of Mercer.

The committee concluded that the services provided by the Marsh & McLennan affiliates (other than Mercer), did not raise any conflicts of interest.

The committee believes the advice it receives from the individual executive compensation consultant is objective and not influenced by Mercer’s or its affiliates’ other relationships with us because of the procedures Mercer and the committee have in place, including the following:

 

   

The consultant receives no incentive or other compensation based on the fees charged to us for other services provided by Mercer or any of its affiliates;

 

   

The consultant is not responsible for selling other Mercer or affiliate services to us;

 

   

Mercer’s professional standards prohibit the individual consultant from considering any other relationships Mercer or any of its affiliates may have with us in rendering his or her advice and recommendations; and

 

   

The committee evaluates the quality and objectivity of the services provided by the consultant each year and determines whether to continue to retain the consultant.

 

2020 Proxy Statement | 20   


Table of Contents

 

Beneficial Ownership of Directors and Executive Officers  

 

 

Beneficial Ownership of Directors and Executive Officers

Set forth in the table below, as of February 28, 2020, are the shares of ManpowerGroup common stock beneficially owned by each director and nominee, each of the executive officers named in the table under the heading “Summary Compensation Table,” and all directors and executive officers of ManpowerGroup as a group and the shares of ManpowerGroup common stock that could be acquired within 60 days of February 28, 2020 by such persons.

 

       

Name of Beneficial Owner

  

Common Stock

Beneficially

Owned(1)(3)

    

Right to

Acquire

Common

Stock(1)(2)

    

  Percent of  

Class

Jonas Prising

       517,756          274,660          *

Gina R. Boswell

       7,141                   *

Richard Buchband

       28,540          22,138          *

Ram Chandrashekar

       3,019          3,019          *

Cari M. Dominguez

       18,625                   *

William Downe

       22,261                   *

John F. Ferraro

                         *

Patricia Hemingway Hall

       10,422                   *

Julie M. Howard

                         *

John T. McGinnis

       57,712          48,613          *

Ulice Payne, Jr

       7,561                   *

Paul Read

       5,353                   *

Elizabeth P. Sartain

       22,230                   *

Mara E. Swan

       44,914          35,485          *

Michael J. Van Handel

       8,283                   *

All directors and executive officers as a group (15 persons)

       753,817          383,915          1.29 %

 

*

Less than 1% of outstanding shares.

 

(1)

Except as indicated below, all shares shown in this column are owned with sole voting and dispositive power. Amounts shown in the Right to Acquire Common Stock column are also included in the Common Stock Beneficially Owned column.

 

  

The table additionally does not include vested shares of deferred stock, which will be settled in shares of ManpowerGroup common stock on a one-for-one basis, held by the following directors that were issued under the 2011 Equity Incentive Plan and the Terms and Conditions Regarding the Grant of Awards to Non-Employee Directors under the 2011 Equity Incentive Plan:

 

   

Director

  

 Vested Deferred Stock 

2011 Plan

 

William Downe

       25,924

John F. Ferraro

       10,977

Patricia Hemingway Hall

       3,858

Julie M. Howard

       9,216

Ulice Payne, Jr.

       3,858

Paul Read

       3,858

Michael J. Van Handel

       3,926

 

   21 | ManpowerGroup


Table of Contents

 

  Beneficial Ownership of Directors and Executive Officers

 

 

  

The table does not include 1,802 unvested shares of deferred stock, which will be settled in shares of ManpowerGroup common stock on a one-for-one basis, held by each of Mr. Downe, Mr. Ferraro, Ms. Howard, Mr. Payne, Mr. Read, and Mr. Van Handel that were issued under the 2011 Plan and the Terms and Conditions on January 1, 2020. These shares of deferred stock vest in equal quarterly installments during 2020.

 

(2)

Common stock that may be acquired within 60 days of the record date through the exercise of stock options and the settlement of restricted stock units.

 

(3)

Includes the following number of shares of unvested restricted stock as of the record date:

 

   

Director

 

  

 Unvested Restricted 

Stock

 

Gina R. Boswell

       1,802

Cari M. Dominguez

       1,802

Patricia Hemingway Hall

       1,802

Elizabeth P. Sartain

       1,802

 

  

The holders of the restricted stock have sole voting power with respect to all shares held and no dispositive power with respect to all shares held.

 

2020 Proxy Statement | 22   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

Compensation Discussion and Analysis

Table of Contents

 

Background

    25  
         

Executive Summary

    25  

2019 Compensation Reflected Challenging Environment

    25  

Our Key Performance Metrics

    26  

Our Executive Pay is Designed to be Competitive, Variable and Affordable

    27  

New Features in Executive Compensation Program

    27  

CEO Compensation was Again Driven by Company Performance

    28  

Realizable Pay for Our CEO Increased in 2019

    28  

Our Business is Impacted by Global Macroeconomic Forces, Business Cycles and Complexity

    28  

Key Compensation and Governance Policies

    29  
         

ManpowerGroup Compensation Principles

    30  
         

Say on Pay Vote

    31  
         

Shareholder Engagement

    31  
         

Compensation Elements

    32  
         

Pay for Results

    34  
         

Target Total Compensation

    35  

Balancing Short- and Long-Term Compensation

    36  
         

Market Positioning: We Target Compensation Outcomes to the Median of the Competitive Market

    37  

How We Determine the Competitive Market: Challenges in Identifying a Relevant Peer Group

    37  

Assessing Individual Factors

    38  
         

The Committee’s Decision-Making Process

    38  

Annual Incentive Plan

    38  

Setting Annual Incentive Goals and Equity Awards for Mr. Prising

    39  

Setting Annual Incentive Goals and Equity Awards for Messrs. McGinnis, Buchband, Chandrashekar, and Ms. Swan

    39  
         

Components of the 2019 Executive Compensation Program — Base Salary

    40  
         

Components of the 2019 Executive Compensation Program — Annual Cash Incentives

    40  

How the Committee Sets Underlying Goals for EPS, ROIC and Revenue

    40  

Why the Company Uses EPS, ROIC and Revenue

    41  

Annual Incentive Award Opportunities by NEO

    42  

Jonas Prising — Annual Incentive Award Opportunities

    42  

John T. McGinnis — Annual Incentive Award Opportunities

    43  

Mara E. Swan — Annual Incentive Award Opportunities

    43  

Richard Buchband — Annual Incentive Award Opportunities

    44  

Ram Chandrashekar — Annual Incentive Award Opportunities

    44  
         

 

   23 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

Components of the 2019 Executive Compensation Program — Long-Term Incentives

     45  

Performance Share Units

     45  

Why the Company Uses Annual Operating Profit Margin and How it Sets Goals

     46  

Shares Earned for the 2017-2019 Performance Period

     47  

Stock Options

     47  

Restricted Stock Units

     47  
          

Career Shares, Retirement and Deferred Compensation Plans

     47  
          

Other Benefits

     48  

We Provide Limited Expatriate Benefits

     48  

Severance Agreements

     48  
          

Governance Features of Our Executive Compensation Programs

     49  

We Have Stock Ownership Guidelines for Executive Officers

     49  

We Have a Clawback Policy

     49  

We Prohibit Hedging, Pledging and Short-Sale Transactions

     49  
          

Realizable Pay in 2019

     49  

Supplemental Table of CEO Realizable Compensation

     50  
          

Other Material Tax Implications of the Executive Compensation Program

     50  
          

 

2020 Proxy Statement | 24   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

Background

This compensation discussion and analysis (“CD&A”) describes ManpowerGroup’s executive compensation program for our executive officers for whom disclosure is required under the rules of the Securities and Exchange Commission (“SEC”). We refer to this group of executives as our named executive officers (“NEOs”). ManpowerGroup’s NEOs for the year ended December 31, 2019 are the Chief Executive Officer (CEO), Chief Financial Officer (CFO), Executive Vice President, Global Strategy and Talent and the Senior Vice President, General Counsel and Secretary, all of whom were serving as executive officers as of December 31, 2019. As required under SEC rules, our NEOs also include our former Executive Vice President, Operational Excellence, Technology and Transformation who left the Company effective October 31, 2019. Our NEOs are listed below with their titles as of December 31, 2019:

 

   

Jonas Prising — Chairman and Chief Executive Officer

 

   

John T. McGinnis — Executive Vice President and CFO

 

   

Mara E. Swan — Executive Vice President, Global Strategy and Talent(1)

 

   

Richard Buchband — Senior Vice President, General Counsel and Secretary

 

   

Ram Chandrashekar — Former Executive Vice President, Operational Excellence, Technology and Transformation

 

(1)

Ms. Swan retired effective March 7, 2020.

Executive Summary

2019 Compensation Reflected Challenging Environment

Our executive compensation programs are designed to reward performance, and our results were mixed when measured against the performance targets established by the Executive Compensation and Human Resources Committee (the “Committee”). Our results are highly dependent on global macroeconomic conditions, including growth rates, business cycles, and labor market conditions in the countries where we operate. During 2019 we experienced continued softening in the economic environment and uncertainty in the global labor markets, especially in Europe, which represents approximately two-thirds of our business by revenue. This environment resulted in a decrease in our revenues for the first time in several years, which is consistent with our experience that during periods of global economic uncertainty, which drive economic decline, our revenues will soften. Although macroeconomic conditions appeared to stabilize during the second half of 2019, much of the year was marked with concerns in the business community about geopolitical instability and potential European recession, which may have contributed to our results.

The Committee has set challenging performance metrics for our short-term and long-term compensation program. For the most part, our results in 2019 fell short of target.

 

 

Annual Incentive Targets

 

   

 

Long-Term Incentives

 

  In a difficult operating environment, revenues were down 0.9% in constant currency in 2019 compared to 2018. This impacted our key performance metric of Revenue, which was newly added for 2019, as well as Earnings Per Share (“EPS”). Both came in below target for 2019.

 

   

  Performance Share Units (“PSUs”) represent the largest component of performance pay for our NEOs. There, our key performance metric of Operating Profit Margin Percent (“OPMP”) further declined in 2019, coming in below the target level for the prior two years.

 

  Return on Invested Capital (“ROIC”) came in above the stated target, as days sales outstanding and free cash flow improved during 2019. This was due to management’s increased focus on collections, working capital optimization and terms of our client relationships.

 

   

  We use three-year performance periods in our PSUs. The below-target performance in 2019 against the OPMP benchmarks set by the Committee brought down the payout percentage for the PSU awards for the 2017-2019 performance cycle.

 

  In total, the financial metrics under our short-term compensation program paid out at approximately 100% of target.

 

   

  It will also have an adverse impact on the payout percentage for previously granted PSU awards covering 2018-2020 and 2019-2021.

 

 

   25 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

Our Key Performance Metrics

We believe these four key performance metrics identify whether we are running our business effectively for our shareholders.

 

   

Earnings Per Share. Focuses our NEOs on producing financial results that align with shareholder interest. We consider this metric a critical measure of executive performance.

 

   

Return on Invested Capital. Even though we operate in the services industry, our business is capital intensive. We must pay our associates and consultants before we typically bill and collect from our clients. ROIC measures how efficiently we are converting our services into cash.

 

   

Revenue. The Committee added Revenue as a key performance metric in 2019. We believe Revenue is a key metric as it keeps NEOs focused on top-line growth, in addition to profitability.

 

   

Operating Profit Margin Percent. Measures how efficiently our NEOs have deployed our operating resources to generate a profit. We believe using this metric drives a long-term focus on achieving sustainable profits, and it is the cornerstone of our long-term incentive plan.

Annual Incentive Plan Metrics

(2019)

 

 

LOGO

PSU Performance Metric — Operating Profit Margin Percent

(2017 - 2019 performance cycle)

 

 

LOGO

 

 

The average operating profit margin percent for the 2017-2019 performance
cycle was 3.7%, resulting in a payout percentage of 86% of target.

 

See page 40 for further discussion regarding the Annual Incentive Plan and page 45 for the PSU program.

 

2020 Proxy Statement | 26   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

One of our principles is that NEO compensation should reward for the underlying performance of our business. As is our practice, the Committee, in adopting financial targets at the beginning of the 2019 performance year, determined that certain items should be excluded from our performance metrics:

 

   

Constant Currency. We eliminate the impact of changes in exchange rates for EPS, ROIC and Revenue. This allows us to better capture year-over-year changes in underlying performance.

 

   

Share Repurchases. We remove the benefit of share repurchases from our EPS calculation except to the extent necessary to offset dilution resulting from shares issued under our equity plans.

 

   

Restructuring Costs. We exclude restructuring costs from our EPS, ROIC and OPMP calculations, net of the savings related to these costs. This allows us to better reflect the Company’s performance for the year.

 

   

Goodwill Impairment. We exclude goodwill impairment charges from our EPS and ROIC calculations. This, too, better reflects the Company’s performance for the year.

 

   

Other Non-Recurring Costs. We exclude from EPS and OPMP any non-recurring accrual adjustments greater than $10 million. As explained above, excluding these costs better reflects the Company’s performance during the year.

The following table shows the impact of each of these items on our performance metrics for 2019:

 

               
    

As

Reported

 

Impact

of

Constant

Currency

 

Impact of

Share

Repurchases

 

Restructuring

Costs

 

Goodwill

Impairment(1)

 

Other

Non-Recurring

Costs(2)

 

As Calculated  

under  

Compensation  

Plans  

EPS

    $ 7.72     $ 0.28     $ (0.12 )     $ 0.27     $ 1.09     $ (1.52 )     $ 7.72

ROIC

      13.2 %       0.5 %       n/a       0.5 %       1.2 %       (1.7 )%       13.7 %

Revenue (in billions)

    $ 20.90     $ 0.90       n/a       n/a       n/a       n/a     $ 21.80

OPMP

      3.09 %       n/a       n/a       0.21 %       0.31 %       (0.11 )%       3.50 %

 

(1)

The adjustment to goodwill relates to goodwill adjustments in our German and New Zealand operations.

 

(2)

In 2019, we acquired the remaining interest of our Switzerland Manpower franchise. Additionally, our joint venture in Greater China, ManpowerGroup Greater China Limited, became listed on the Main Board of the Stock Exchange of Hong Kong Limited through an initial public offering, which resulted in the deconsolidation of the business. The EPS, ROIC and OPMP metrics exclude the operating results of the acquired franchise business and have also been adjusted to reflect the impact of the deconsolidated Chinese business. One-time accounting gains associated with these two transactions were also excluded from the EPS, ROIC and OPMP calculations. The total impact of both transactions resulted in a decrease to EPS of $1.76, ROIC of 1.9% and OPMP of 0.11%. Other non-recurring adjustments also include an increase to EPS of $0.24 and ROIC of 0.2%, related to certain tax adjustments that were greater than $10 million.

Our Executive Pay is Designed to be Competitive, Variable and Affordable

We believe the interests of our shareholders are served when strong operating performance drives enhanced financial performance. Therefore, the pay for our CEO and our other executive officers is closely aligned with our results, and their compensation varies year-over-year based on whether they have achieved collective and individual performance goals set by our Committee. This helps us maintain executive compensation that is reasonable and affordable in light of our financial results.

We are significantly larger than other U.S.-listed companies in our industry and our closest competitors are based in Europe where compensation and disclosure practices differ. We reference a cross-industry peer group, which consists of 90 companies within the S&P 500 with revenue approximately 70% to approximately 190% of our revenue. The Committee believes that using this group provides a robust basis for comparing us to companies of similar scale and complexity and represents the universe of top-tier companies we consider our competitors for executive talent.

New Features in Executive Compensation Program

In 2019, the Committee determined to refine our executive compensation program in the following ways to support the company’s operational and strategic goals and more closely align compensation with company performance:

 

   

Addition of Revenue as a Performance Metric. In 2019, the Committee modified the performance metrics to add a Revenue benchmark in determining the annual incentive awards paid to our NEOs. The addition of this metric creates an important incentive for management to continue to grow the business, either organically or inorganically, and to do so in a manner that does not damage financial returns measured by the other metrics of EPS and ROIC. For 2019, the Committee determined that the Revenue goal should represent a smaller component of the annual

 

   27 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

 

incentive awards to our NEOS than the goals for EPS and ROIC as the Committee believed that company Revenue would be a proportionately smaller contributor to overall performance than EPS or ROIC.

 

   

Addition of Modifier to Performance Share Unit Awards. In 2019, the Committee added a modifier feature to the performance share units awarded to our NEOs to incent management to achieve strategic growth objectives. Under this new feature, the final performance share unit payout is subject to modification by the Committee, upward or downward, by an amount up to 30%, based on performance against specific strategic growth objectives the Committee established at the time of grant. Performance against those objectives is evaluated by the Committee throughout the three-year performance period to track progress. At the end of the three-year performance period, the Committee will assess the achievement of the strategic growth objectives and increase or decrease the final payout percent by an amount up to 30%. The modifier will not decrease the payout below the threshold level nor increase the payout above the outstanding level.

CEO Compensation was Again Driven by Company Performance

We remain committed to performance-based compensation. Approximately 75% of Mr. Prising’s 2019 target compensation was tied to Company performance and 90% of his total pay was variable. Given our financial performance in 2019, Mr. Prising’s total compensation in 2019 was 100% of target. The discussion below highlights each component of Mr. Prising’s compensation in 2019.

Annual Cash Incentive: Payout was Approximately 99.8% of Target. In light of the financial performance of the Company and the Committee’s assessment of Mr. Prising’s achievement of his operating objectives as CEO, Mr. Prising’s annual cash incentive payout was 99.8% of target.

The following table shows the actual cash incentive payout to Mr. Prising for 2019:

 

     
     

2019 Actual

Payout $

 

    

 % Compared 

to Target

 

EPS Goal

       468,897          78.1 %

ROIC Goal

       766,667          127.8 %

Revenue Goal

       340,000          85.0 %

Operating Objectives

       420,000          105.0 %

Total

       1,995,564          99.8 %

Long-Term Equity Awards. Mr. Prising’s 2019 compensation package included three types of long-term equity awards:

 

   

Approximately 60% were performance share units, that can be earned over three years based on OPMP goals.

 

   

Approximately 20% were stock options that vest over a four-year period.

 

   

Approximately 20% were restricted stock units that cliff vest in full after three years.

Realizable Pay for Our CEO Increased in 2019

We calculated realizable pay for Mr. Prising to show the impact of Company performance and stock price on his compensation granted or awarded during the year. The Company’s stock price increased significantly during 2019: from $64.80 on January 1, 2019 to $97.10 as of December 31, 2019. This appreciation in stock price resulted in Mr. Prising’s calculated realizable pay being $13.1 million for 2019. This is slightly higher than $12.5 million of total compensation shown in the Summary Compensation Table using SEC reporting methodology. It reflects a 111% increase from his realizable pay for 2018, when considerable stock price depreciation and below-target operating performance resulted in realizable pay that was significantly lower than reported compensation. See page 49 for further details.

Our Business is Impacted by Global Macroeconomic Forces, Business Cycles and Complexity

We derive approximately 88% of our revenue from outside the United States, with the largest portions coming from our operating segments in Southern Europe (44%), Northern Europe (22%) and Asia Pacific Middle East (13%). Our business is truly global in nature and complexity. Through our global network including approximately 2,500 offices in 75 countries and territories, we put millions of people to work each year with our global, multinational and local clients across multiple industry segments and provide a broad range of workforce solutions including recruitment and assessment, training and development, career management, outsourcing and workforce consulting.

 

2020 Proxy Statement | 28   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

Key Compensation and Governance Policies

The Committee continually reviews the Company’s executive compensation program to maintain compensation practices that are in the best interests of our shareholders. Some of our key policies are summarized below:

 

         WHAT WE DO:             WHAT WE DON’T DO:
     We tie pay to performance, including the use of performance share units. The majority of executive pay is performance-based and variable.     ×     We do not pay any of our long-term incentives in cash as the objective of our long-term incentive plan is to incentivize executives to increase shareholder return.
     We set challenging performance objectives that align with company performance. The Committee evaluates these metrics on an annual basis and will add or change performance objectives when appropriate for stronger alignment.     ×     We do not use Total Shareholder Return (“TSR”) as a performance metric for our NEOs. In our experience, TSR captures fluctuations in stock price, rather than measuring the performance of our executive team in operating our business. Our stock price can be sensitive to perceived changes in the global business climate, and we often experience fluctuations in stock price that are de-coupled from the fundamentals of our business. Instead of using TSR, our Committee sets meaningful targets each year for our four key metrics.
     We appropriately balance short-term and long-term incentives.     ×     We do not provide tax gross up payments for any amounts considered excess parachute payments.
     We have caps on the potential payouts under the performance share unit grants and our annual incentive program.     ×     We do not pay dividends on performance share units and only pay dividend equivalents on restricted stock units if and when they vest.
     We use double triggers in our severance agreements and our equity awards.     ×     We do not encourage undue risk taking in our compensation plans. By using varied financial metrics and setting caps on potential payouts the company mitigates undue risk taking.
     We maintain significant stock ownership guidelines for our NEOs.     ×     We do not permit the repricing of stock options without prior shareholder approval, except in connection with a transaction.
     The Committee engages an independent compensation consultant that works solely in support of the Committee.     ×     We do not allow hedging or pledging of ManpowerGroup stock.
     We use appropriate peer groups when establishing compensation. Each year, the Committee devotes considerable effort in re-evaluating the Company’s peer group.     ×     We do not provide excessive perquisites to our NEOs.
     We listen to our shareholders. We regularly reach out to leading shareholders and their advisory firms to discuss our governance and executive compensation. In 2019, we continued to meet with our shareholders to review these topics and ensure our programs are well-understood and consistent with their expectations.        

 

   29 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

       

 

WE MAINTAIN STRONG COMPENSATION AND CORPORATE GOVERNANCE PRACTICES:

 

Over the years we have continued to enhance our compensation and corporate governance practices:

 

   

 

Key performance metrics tied to our business: In 2019, we added a Revenue metric to our annual incentive awards to keep our NEOs focused on continuing to grow the business. Previously, we replaced Economic Profit with ROIC to more clearly measure how effectively we are using our capital.

 

 

   

 

 

A 3-year performance period for performance share units: We re-introduced a 3-year performance period for performance share units to better align the interests of executive officers with long-term shareholder value.

 

 

   

 

Expanded use of performance-based equity: Today, performance share units represent approximately 60% of long-term equity grants.

 

 

   

 

Strong lead director: We eliminated a practice in which we rotated our lead director annually. Today, our board appoints a lead director with the intent that the individual will serve for at least three years. The lead director has a clear set of roles and responsibilities and receives additional compensation for serving in this role.

 

 

   

 

Clawback policy: Under our clawback policy, if the Committee determines an employee engaged in intentional misconduct that causes a financial restatement, it may revoke any outstanding awards, including cash incentives or equity awards, that were received as a result of the misconduct.

 

 

   

 

Commitment to board diversity and refreshment: Our board is focused on having fresh perspective on the board and its committees, including a diversity of thought and background. Our board is approximately 45% female and has an average tenure of 7.9 years.

 

 

   

 

Board evaluation program: We have strengthened our board evaluation process by including a facilitated evaluation, led by an experienced external resource.

 

 

   

 

Succession plan for executive officers: We have developed a robust succession planning process for our executive officers and senior leadership designed to ensure we have experienced and capable leaders who are prepared to assume executive roles as they become available.

 

ManpowerGroup Compensation Principles

Our Committee is guided by a series of principles, listed below. Within the framework of these principles, the Committee considers governance trends, the competitive market, corporate, business unit and individual results, and various individual factors.

ManpowerGroup’s executive compensation guiding principles are to:

 

   

Pay for results: We tie a significant portion of compensation to the achievement of Company and business unit goals as well as to recognize individual accomplishments that contribute to success. For example, in 2019, approximately 60% of the CEO’s and 56% of the CFO’s target compensation, respectively, was tied to short- and long-term financial performance goals.

 

   

Not pay for failure: We set threshold goals for each performance-based incentive element of our executive compensation program. The Committee believes these threshold goals are the lowest acceptable levels at which it is appropriate for the NEOs to receive an award. If the threshold level is not met, NEOs do not receive a payout related to that performance measure. In 2019, our results were between the threshold level and target level for EPS and Revenue and between the target level and outstanding level for ROIC under the annual incentive plan. OPMP was between the threshold level and target level under the performance share unit grants.

 

   

Align with shareholder interests: The Committee sets performance goals and chooses compensation elements that closely align executives’ interests with those of shareholders. For example, performance share units, which make up approximately 44% of target compensation for the CEO and 38% for the CFO, respectively, are tied to operating profit margin, which we believe helps to drive enterprise value. Stock options

 

2020 Proxy Statement | 30   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

 

and restricted stock units are directly aligned with shareholders’ economic interests as the ultimate value the NEOs realize is dependent upon the value of our stock. In addition, a substantial portion of the annual cash incentive awards paid to our CEO and CFO is based on achievement of EPS, ROIC and Revenue goals for the year.

 

   

Balance cash and equity: We balance the mix of cash and equity compensation to align compensation to both long- and short-term results of the Company.

 

   

Use internal and external performance reference points: We evaluate the elements of our compensation program against appropriate comparator company practices as well as other executives within the Company. However, identifying our competitive market is a challenge. See page 37 for further information regarding our competitive market.

 

   

Recognize the cyclical nature of our business: Our business is highly cyclical, and our financial results are impacted by global economic cycles, which are difficult to predict. In determining executive compensation, the Committee tries to strike an appropriate balance between fixed and variable pay, and to create meaningful incentives at all points in an economic cycle.

 

   

Pay competitively: In order for ManpowerGroup to be successful, we need senior executives who have the capability and experience to operate in a global and complex environment. The Committee believes it must provide pay opportunities to the NEOs that are competitive in order to attract and retain executives of this caliber.

 

   

Attract and retain executives: The Company structures its compensation program for the NEOs so that the overall target outcome generally falls within the median of the competitive market. The Committee believes this is the appropriate level to provide in order to attract and retain executives.

 

   

Assure total compensation is affordable: Our NEOs’ compensation is variable year-over-year, which means compensation is higher when financial objectives are achieved, and incremental compensation is more affordable for the Company and compensation is lower when financial results decline, and it is less affordable for the Company. In addition, payouts under the annual cash incentive plan and the performance share units are capped at the outstanding performance levels, which make the maximum cost predictable and ensures affordability.

 

   

Clearly communicate plans so that they are understood: We clearly communicate to each NEO their specific goals, targets and objectives to ensure our executives are focused on achieving the financial and operational results that the Committee believes will best promote shareholder value.

Say on Pay Vote

ManpowerGroup held a non-binding shareholder advisory vote at its 2019 Annual Meeting of Shareholders to approve the compensation of ManpowerGroup’s NEOs, also known as “Say on Pay.” This shareholder resolution was approved by approximately 95% of the votes cast. This was the sixth consecutive year we received a say on pay result above 90%, which we believe demonstrates our shareholders’ satisfaction with the alignment of our NEOs’ compensation with the Company’s performance. In some years, this result has been as high as 98%. Accordingly, we have not made significant changes to the compensation program for 2020 in response to this vote.

Shareholder Engagement

We believe that shareholder engagement is an important part of our governance practices. Over the past five years, we have enhanced our shareholder outreach program, to better understand our investors’ perspectives on our compensation philosophies and our governance structure, and to answer their questions. These efforts are conducted by members of executive management, and have included:

 

   

Contacting our top shareholders, representing more than 50% of our shares.

 

   

Meeting with shareholders representing approximately 40% of our shares.

 

   

Presenting shareholder feedback to the Committee as well as the nominating and governance committee.

 

   31 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

The Committee evaluated this feedback, as well as our say on pay voting results (95% in 2019 and 92% in 2018), among other factors in developing our executive compensation programs as discussed in this CD&A. Similarly, our nominating and governance committee has reviewed the feedback concerning our governance practices in developing our governance policies, including our approach to board refreshment.

Additionally, our executive management team, primarily through our Chairman and CEO and Executive Vice President and CFO, regularly engage in dialogue with our shareholders through our quarterly earnings calls, investor meetings and conferences, and other channels for communication.

Compensation Elements

The following are the main elements used by ManpowerGroup in its compensation program in 2019 along with key decisions by the Committee related to those elements:

 

       

Compensation Element

 

  

Key Characteristics

 

  

Objective and Determination

 

  

2019 Decisions

 

Base Salary    Fixed compensation for performing the core areas of responsibility in amounts that are competitive in the markets in which we operate.   

Provide fixed compensation for performing the core areas of responsibility of the NEO. These are reviewed annually and adjusted when appropriate.

 

Factors used to determine base salaries:

 

  NEO’s experience, skill, and performance.

 

  The breadth of the NEO’s responsibilities.

 

  Internal equity among other NEOs.

 

  Pay relative to market.

 

  

  All NEOs except Mr. Prising received an increase in salary in 2019.

Annual Incentive Award    Variable compensation payable in cash based on performance against annually established goals and assessment of individual performance.   

Motivate and reward NEOs for achievement of key strategic, operational and financial measures over the year.

 

Measures used to determine annual incentive for NEOs in 2019:

 

  The annual incentives for the NEOs were made under the Annual Incentive Plan (“Incentive Plan”). The Incentive Plan provides for the payment of annual cash rewards to a participant based on the Company’s attainment of one or more performance metrics and operating objectives established for that participant for the relevant year. The maximum individual limit in any year under the Incentive Plan is $5 million.

 

  The performance metrics used to determine NEOs annual incentive were EPS, ROIC and Revenue for all NEOs.

 

  

  The EPS and Revenue levels achieved were between the threshold and target level. The ROIC level achieved was between the target and outstanding level.

 

  Each of the NEOs received a percentage of their incentive for achieving a specified level of their individual operating objectives.

 

  See page 40 for more information.

 

2020 Proxy Statement | 32   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

       

Compensation Element

 

  

Key Characteristics

 

  

Objective and Determination

 

 

2019 Decisions

 

Performance Share Units   

Variable compensation payable in shares of stock.

 

The performance share units vest based on achievement of a pre-established performance metric over a period of time. If goals are not met, shares are not received.

  

Motivate and reward NEOs for performance against long-term financial objectives to align the interests of the NEOs with long-term shareholder value. Target amount awarded is determined based on job scope, market practice and individual performance.

 

Measures used to determine performance share units earned:

 

  A threshold level of average operating profit margin percent must be achieved during the 2019-2021 performance period to receive any performance share unit vesting.

 

  Payout levels for threshold, target and outstanding results are determined, and the actual payout percentage is calculated by interpolation.

 

  However, if average operating profit does not meet a certain pre-determined dollar “gate” over the 2019-2021 performance period, NEOs will not receive more than 100% of the target level payout.

 

  The performance share units granted in 2019 include a modifier to the final performance share unit payout that can increase or decrease the final payout by up to 30%. At the end of the three-year performance period, the Committee will assess the achievement of pre-established strategic growth objectives and increase or decrease the final payout percentage by up to 30%. The total payout cannot be below threshold or exceed outstanding levels.

 

 

  In 2019, performance share units represented approximately 60% of the total long-term equity incentive grants awarded to all of the NEOs, except for Ms. Swan who did not receive performance share units in 2019.

 

  Also in 2019, for the performance share units granted in 2017, the NEOs earned 86% of target performance share units based on the three-year performance period ended December 31, 2019.

 

  See page 45 for more information.

Restricted Stock Units    Variable compensation payable in shares of stock. 100% of the restricted stock units vest on the third anniversary date.   

  Restricted stock units cliff vest in full after three years and are paid in stock.

 

  Through stock price and dividend equivalents, restricted stock units directly align NEOs with the shareholders and add balance to the compensation program as they provide both upside potential and downside risk and add an additional retention incentive. Amount awarded is determined based on job scope, market practice and individual performance.

 

 

  Approximately 20% of all of the NEOs’ long-term equity incentive grants in 2019 were in the form of restricted stock units. In the case of Ms. Swan, this figure was 100%.

 

   33 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

       

Compensation Element

 

  

Key Characteristics

 

  

Objective and Determination

 

 

2019 Decisions

 

Stock Options    Nonqualified stock options that expire in ten years and become exercisable ratably over four years.   

  Align the interests of the NEOs with long-term shareholder value as well as retain executive talent. Amount awarded is determined based on job scope, market practice and individual performance.

 

 

  Approximately 20% of all of the NEOs’ long-term equity incentive grants in 2019 were in the form of stock options, except for Ms. Swan who did not receive stock options in 2019.

Qualified Retirement Plans    Generally not available to NEOs.   

  No pension plan benefit in the United States, as we froze the qualified, noncontributory defined benefit pension plan, as well as the nonqualified, noncontributory defined benefit deferred compensation plans as of February 29, 2000.

 

  Although we maintain a qualified 401(k) plan in the United States, our NEOs are not eligible to participate (except as described in the following sentence) because of limitations on participation by highly compensated employees under the rules governing such plans. NEOs are eligible to participate only in the first year of their employment (after which they are eligible to participate in the nonqualified savings plan) and in making catch-up contributions for individuals over the age of 50.

 

 

  Ms. Swan and Mr. Buchband participated in the catch-up contribution under the 401(k) plan in 2019.

Nonqualified Savings Plan   

Similar to a 401(k) plan, however not as flexible in regard to timing of the payouts of the retirement benefits for nonqualified plans. These benefits are unsecured and subject to risk of forfeiture in bankruptcy.

 

  

  Used to provide NEOs with reasonably competitive benefits to those in the competitive market. NEOs are eligible to participate after the first year of employment.

 

  Mr. Prising, Mr. McGinnis, Ms. Swan and Mr. Buchband participated in the NQSP in 2019.

Career Shares   

Used selectively by the Committee, taking into account what is most appropriate for a NEO in view of the retention incentive provided by the award. Restricted stock units vest completely on a single date several years into the future.

 

  

  Used as an incentive in the form of restricted stock units to attract and retain executives. The Committee considers each year whether to make any such grants and to whom.

 

  No grants of career shares were made to the NEOs in 2019.

Other Benefits    Used to attract and retain talent needed in the business.   

  Additional benefits include financial planning reimbursement, broad-based automobile benefits, selected benefits for expatriate executives, participation in broad-based employee benefit plans, and certain other benefits required by local law or driven by local market practice.

 

 

  Limited participation by the NEOs in these programs.

Pay for Results

Our executive compensation program is designed to motivate our NEOs to contribute to the Company’s long-term performance and success. As such, the following pay components include pay for results features:

 

   

Annual Incentive Award: For 2019, performance goal ranges for our cash-based annual incentive award were established for Messrs. Prising, McGinnis, Buchband and Chandrashekar and Ms. Swan for the performance metrics EPS, ROIC and Revenue. Award opportunities are established for achievement at

 

2020 Proxy Statement | 34   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

 

threshold, target and outstanding levels. Payouts are generally based on actual performance on these metrics as well as the individual operating objectives for each NEO.

 

   

Performance Share Units: Approximately 60% of the NEOs’ long-term awards for 2019 were made in the form of performance share units, except for Ms. Swan who did not receive a performance share unit grant in 2019. As stated earlier, the NEOs receive a certain number of shares of stock at the end of a specified period based on achievement measured against pre-established performance goals for that period, typically operating profit margin percent. For 2019, the Committee again used a three-year performance period (2019-2021) for performance share unit awards. Award opportunities are established for achievement at threshold, target and outstanding levels. The Committee believes using operating profit margin percent is appropriate because it is a driver of shareholder value.

For 2019, the Committee also introduced a modifier to the final performance share unit payout that can increase or decrease the final payout by up to 30%. The modifier is based on an evaluation of pre-established strategic growth objectives over the performance period. At the end of the three-year performance period, the Committee will assess the achievement of the strategic growth objectives and increase or decrease the final performance share unit payout percent by an amount up to 30%. The modifier will not decrease the payout below the threshold level nor increase the payout above the outstanding level.

 

   

Stock Options: Approximately 20% of the NEOs’ long-term awards are made in the form of stock options, except for Ms. Swan who did not receive a stock option grant in 2019. The Committee believes stock options provide an important overall longer-term incentive for the NEOs. Because stock options are granted at a specific value on the date of grant, the ultimate compensation realized will depend on the stock price at the time of exercise.

Target Total Compensation

Target total compensation is the value of the compensation package that is intended to be delivered based on performance against pre-established goals. The following chart illustrates for each of the NEOs the composition of his or her target total compensation for 2019 among the various compensation elements:

2019 Target Compensation Components

 

LOGO

The Committee’s compensation consultant, Mercer, provides the Committee with market data that is used in setting target levels for compensation for the NEOs. Actual compensation paid out to the NEOs in a given year may vary significantly from the target levels depending on the actual performance achieved under the pre-established financial and operating goals set by the Committee. The target compensation is detailed for each NEO in the following table.

 

   35 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

This table outlines the values of the various elements and the percentage of each NEO’s total target compensation package that is variable (both short- and long-term) and performance-based (both short- and long-term).

2019 NEO Target Compensation

 

                 

NEO

  

Base

Salary

    

Annual

Incentive

    

Stock

Options(1)

    

Performance

Share

Units(1)

    

Restricted

Stock

Units(1)

    

Total 2019

Target

Comp

    

% Total

2019

Target

Comp

Variable(2)

   

% Total 2019

Target

Comp

Performance-

Based(3)

 
     

$

 

    

$

 

    

$

 

    

$

 

    

$

 

    

$

 

                

Jonas Prising

     1,250,000        2,000,000        1,850,009        5,550,006        1,850,030        12,500,045        90     75

John T. McGinnis

     725,000        725,000        510,002        1,530,040        510,042        4,000,084        82     69

Mara E. Swan

     655,000        491,250                      1,350,036        2,496,286        74     20

Richard Buchband

     525,000        315,000        160,002        480,069        160,079        1,640,150        68     58

Ram Chandrashekar

 

    

 

672,678

 

 

 

    

 

504,509

 

 

 

    

 

380,012

 

 

 

    

 

1,140,058

 

 

 

    

 

380,019

 

 

 

    

 

3,077,276

 

 

 

    

 

78

 

 

   

 

66

 

 

 

(1)

The value of equity awards in this table represents the grant date fair value of the equity awards at the target levels granted in 2019, as computed in accordance with FASB ASC Topic 718.

 

(2)

Includes annual incentive, stock options, performance share units and restricted stock units.

 

(3)

Includes annual incentive, stock options and performance share units.

Balancing Short- and Long-Term Compensation

The Committee also considers how much incentive compensation is short-term in nature, and how much is long-term, with the intention that a significant portion of incentive compensation be based on the long-term performance of the Company. This reduces the risk that executives will place too much focus on short-term achievements to the detriment of the long-term success of the Company.

The following chart details how incentive compensation is allocated between short-term (annual cash incentive) and long-term incentive compensation (stock options, performance share units and restricted stock units) for each of the NEOs.

2019 Long-Term vs. Short-Term Incentive

Compensation

 

LOGO

 

2020 Proxy Statement | 36   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

Market Positioning: We Target Compensation Outcomes to the Median of the Competitive Market

The Company’s practice is to target compensation outcomes generally to the 50th percentile of compensation paid in the competitive market for target results. Our maximum award opportunities for outstanding results are generally set to approximate the 75th percentile of the competitive market. This is not strictly formulaic, and some compensation levels or award opportunities may fall above or below the reference points. When setting each component of compensation, the Company takes into consideration the allocation of awards in the competitive market between current cash compensation and non-cash compensation including stock options, performance share units and restricted stock units.

How We Determine the Competitive Market: Challenges in Identifying a Relevant Peer Group

In alignment with its compensation principles, the Committee devotes considerable effort to identifying an appropriate competitive market for benchmarking our executive compensation. This process is conducted and reviewed annually. The following outlines the analysis by the Committee, and its independent compensation consultant, Mercer, to develop meaningful peer groups. As discussed further below, the Committee has determined that simply benchmarking against other U.S. companies in our industry would not yield a meaningful peer group — we present a different profile, being significantly larger, more complex, and more global in scope than other U.S.-listed companies in our industry.

The Committee primarily utilizes a customized peer group developed by Mercer consisting of companies within the S&P 500. For ManpowerGroup, Mercer has removed companies that are not comparable to us, to arrive at a research subset of 90 companies within the S&P 500 with minimum revenues of approximately $14 billion, maximum revenues of approximately $42 billion, and median revenues of $21 billion. The Committee believes that using this group provides a robust basis for assessing the competitive range of compensation for senior executives of companies of ManpowerGroup’s scale and that it also represents the universe of top-tier companies we consider when looking for executive talent. A list of the companies included in the peer group used by ManpowerGroup is attached as Appendix A-1.

One reason we utilize the customized set of comparison companies is that it is difficult to find an industry-specific group of peer companies. Our two largest competitors, Adecco and Randstad, are based in Europe, and although we review available compensation data for these two companies, their pay practices are different and disclosure practices differ. Our nearest U.S. public competitor had much smaller revenue — approximately $6.1 billion in 2019 compared to our revenue of $20.9 billion — and the other U.S. public competitors are even smaller. Mercer has confirmed to the Committee that attempting to use such competitors would not produce meaningful data.

The Committee also utilizes data from U.S. compensation surveys published by Mercer and other third-party data providers that are recommended by Mercer as a means to evaluate compensation for certain NEO positions. For the CEO and CFO, their positions were only compared to companies within the subset group of the S&P 500. Compensation for global functional leaders was compared against compensation survey data recommended by Mercer for executives with similar roles and responsibilities. For Ms. Swan, her position was compared to human resource management executives of companies within the subset group of the S&P 500 and secondarily compared with U.S. compensation survey data of human resource management executives. For Mr. Buchband, his position was only compared with U.S. compensation survey data of legal executives. Both Ms. Swan’s and Mr. Buchband’s market data were adjusted to reflect the scope of their responsibilities. For Mr. Chandrashekar, his position was compared to information technology executives of companies within the subset group of the S&P 500 and secondarily compared with compensation survey data of Chief Information Officers (CIO). For executives whose positions were located outside of the U.S., ManpowerGroup also took into account international (regional and local) compensation survey data in an effort to set compensation that is not only equitable among the members of a global team, but also competitive within the global markets where ManpowerGroup competes for talent.

Prior to setting compensation for 2019 for our NEOs, the Committee reviewed the following table which illustrates how the total opportunity at target performance for total direct compensation for 2018 compared to the median compensation of executives in similar positions taken from the primary data source used for that executive.

 

   37 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

Total Direct Compensation

 

   

NEO

  

% Variance Median of

Competitive Market(1)

 

 

Jonas Prising

 

  

 

 

 

 

(14

 

 

)% 

 

 

John T. McGinnis

 

  

 

 

 

 

(16

 

 

)% 

 

 

Mara E. Swan

 

  

 

 

 

 

(18

 

 

)% 

 

 

Richard Buchband

 

  

 

 

 

 

1

 

 

 

 

Ram Chandrashekar

 

  

 

 

 

 

14

 

 

 

 

  (1)

For Mr. Prising and Mr. McGinnis the primary data source was the peer group subset of the S&P 500. For Ms. Swan and Mr. Chandrashekar, the primary data source was a composite of the peer group subset of the S&P 500 and published surveys. For Mr. Buchband, the primary data source was published surveys.

It was observed that target compensation for 2018 for several of the NEOs fell below the median total direct compensation. The Committee determined that in light of this, adjustments to the NEOs total direct compensation would be appropriate. In 2019, Mr. Prising received an increase in equity as well as an increase in his target opportunity for his annual incentive to 160%, compared to 150% in 2018. Mr. McGinnis received an increase in both base salary and equity and Messrs. Chandrashekar and Buchband and Ms. Swan received an increase in base salary in 2019.

Assessing Individual Factors

An individual NEO’s total compensation or any element of compensation may be adjusted upwards or downwards relative to the competitive market based on a subjective consideration of the NEO’s experience, potential, tenure and results (individual and relevant organizational results), internal equity (which means that comparably positioned executives within ManpowerGroup should have comparable award opportunities), the NEO’s historical compensation, and any retention concerns. The Committee uses a historical compensation report to review the compensation and benefits provided to each NEO in connection with its compensation decisions concerning that NEO.

The Committee’s Decision-Making Process

The Committee determines the CEO compensation levels, including base salary, establishing and determining the achievement of the financial goals and operating objectives for the annual cash incentives, and any equity-based compensation awards. Generally, the CEO establishes and determines the achievement of the goals and objectives for the annual incentives for the other NEOs, with the Committee making the final determinations. Similarly, the CEO generally recommends to the Committee any salary adjustments, cash incentive awards or equity-based awards for the other NEOs, which are then evaluated and determined by the Committee. Mercer also provides input to the Committee regarding the final 2019 compensation for all of the NEOs. This input reflected the Company’s performance results for 2019, external market references against the peer group, internal compensation references and the individual performance of each of the NEOs. Under the Committee’s charter, compensation for our CEO and CFO is subject to ratification by the board of directors. Accordingly, the board of directors ratified the determinations for Mr. Prising and Mr. McGinnis, who were our executives at this level.

Annual Incentive Plan

In February 2019, the annual incentive awards for our NEOs were granted under the ManpowerGroup Inc. Annual Incentive Plan (the “Incentive Plan”). The Incentive Plan provides for the payment of annual cash awards to a participant based on the Company’s attainment of one or more financial goals and operating objectives established for that participant for the relevant year. Under the Incentive Plan, the participant is assigned award opportunities for threshold, target, and outstanding performance upon the attainment of the financial goal or goals and operating objectives established for the participant, as determined by the Committee at the beginning of the year. Depending upon the actual performance of ManpowerGroup for the year as measured against these financial goals, and the assessment of the participant’s performance in achieving the operating objectives, the participant would be paid a cash award following the close of the year. The maximum award that a participant may receive for any year under the Incentive Plan is $5 million.

 

2020 Proxy Statement | 38   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

Setting Annual Incentive Goals and Equity Awards for Mr. Prising

For 2019, the annual financial goals for the CEO under the Incentive Plan are based on EPS, ROIC and Revenue for the year. The process begins with collaboration among Mercer, the CFO and the Executive Vice President, Global Strategy and Talent. The full Committee then reviews and determines the goals and range of award opportunities for achievement of the goals, including the weighting of each goal for the CEO, subject to ratification by the board of directors. In determining these goals, the Committee considers financial information including historical and projected earnings growth, the prior year financial results and the Company’s expected financial performance for the current year, consulting with management, including financial personnel, and Mercer.

Setting the operating objectives for the CEO begins with the CEO recommending to the Committee the objectives for himself for the year. The Committee reviews and ultimately approves these operating objectives, subject to any adjustments, in the context of ManpowerGroup’s strategic and financial plans.

At each Committee meeting during the year, the Committee reviews the progress the CEO is making towards the achievement of his financial goals and operating objectives for the year. After the close of each year, the Committee reviews and approves, subject to ratification by the board of directors, an award amount for the annual cash incentive based on whether the annual financial goals have been achieved and based on the CEO’s performance towards each of his annual operating objectives.

The Committee will generally determine and approve equity awards to the CEO and the related vesting schedules, at its regularly scheduled meeting in February each year, subject to ratification by the board of directors. The exercise price for any options granted is the closing price on the date of grant.

As part of the decision-making process for the CEO’s compensation matters, any decisions of the Committee or ratifications by the board of directors regarding the CEO’s compensation, are done in executive session without any management present.

Setting Annual Incentive Goals and Equity Awards for Messrs. McGinnis, Buchband, Chandrashekar, and Ms. Swan

The process for setting the annual financial goals for the other NEOs also begins with collaboration among Mercer, the CFO and the Executive Vice President, Global Strategy and Talent selecting the objective financial metrics and establishing proposed goals for those selected metrics for each of the NEOs. The recommended financial metrics and proposed goals are then reviewed and approved by the CEO. The EPS, ROIC and Revenue metrics are used for each NEO, with the same goals as those used for the CEO. The Committee reviews these recommended financial goals, makes any adjustments it deems appropriate and then approves the financial goals and range of award opportunities, including the weighting of each goal.

For 2019, Mr. Prising approved the operating objectives for Messrs. McGinnis, Buchband and Chandrashekar and Ms. Swan, which were reviewed by the Committee.

After the close of each year, the Committee reviews and approves an award amount for the annual incentive to each NEO based on achievement of the NEO’s annual objective financial goals under the Incentive Plan. The CEO determines the recommended amount of any award to each of the NEOs for performance towards each of their annual operating objectives. The CEO presents the recommended award for each NEO to the Committee for its review and approval, subject to ratification by the board of directors for Mr. McGinnis. For Mr. Chandrashekar the Committee approved an incentive for 2019, based on actual results for the year but prorated through his last day of employment.

The Committee generally determines and approves equity awards to the other NEOs, including vesting schedules, at its regularly scheduled meeting in February each year, and as required under the Committee’s charter, subject to ratification by the board of directors in the case of the CFO. These are generally based on recommendations by the CEO (although not with regard to himself). The Committee may make grants to NEOs at other times during the year, as it deems appropriate. The exercise price for any options granted is the closing price on the date of grant.

 

   39 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

Components of the 2019 Executive Compensation Program — Base Salary

Base salaries for NEOs are set near the median of base salaries paid in the relevant competitive market, for the particular position, subject to individual performance factors as described earlier. For 2019, the Committee increased the base salary for each of the NEOs other than Mr. Prising as described earlier.

Base salary levels affect the value of the annual incentive awarded to the NEOs because the incentive award is awarded as a percentage of base salary. A higher base salary will result in a higher annual incentive, assuming the same level of achievement against goals. The level of severance benefits each NEO may receive is also increased if his or her salary is increased. The value of long-term incentive awards is not determined as a multiple of base salary.

Components of the 2019 Executive Compensation Program — Annual Cash Incentives

As explained previously, all of the NEOs participate in the Incentive Plan, which provides for annual incentive compensation awards that are tied to ManpowerGroup’s financial results. The Incentive Plan provides for the payment of annual cash rewards to a participant based on the Company’s attainment of one or more financial goals and operating objectives established for that participant for the relevant year. The incentive amounts are based on achievement of pre-established goals using these metrics. The Incentive Plan provides for a variety of financial goals that are used in determination of the amount of any annual incentives earned by the NEOs. The financial goals include EPS, ROIC, Revenue, as well as other metrics. The operating objectives are typically tied to broad strategic or operational initiatives.

How the Committee Sets Underlying Goals for EPS, ROIC and Revenue

As noted above, the annual cash incentives for NEOs for 2019 are based on three objective factors — EPS, ROIC, Revenue and individual performance objectives. For EPS, ROIC and Revenue, the Committee sets target outcomes at a number that reflects an annual growth target. For 2019, when setting the targets, the Committee established the targets of EPS and ROIC excluding anticipated restructuring charges. As mentioned earlier, the Committee has also determined to exclude the impact of currency when calculating EPS, ROIC and Revenue to ensure that payments under our annual incentives reflect the underlying performance of our business. The Committee has also determined to exclude the benefit of current year share repurchases in excess of dilution when calculating EPS. For 2019, the Committee also determined to exclude certain other non-recurring items when calculating EPS, ROIC and Revenue, as described in the following calculations:

 

   

EPS — net earnings per share — diluted, including net earnings from continuing and discontinued operations, but excluding the impact of currency, restructuring charges net of related savings, any cumulative effects of changes in accounting principles, extraordinary items, goodwill impairment or the benefit of current year share repurchases in excess of dilution. Earnings per share are further adjusted for the following items that exceed $10 million individually: tax or regulatory law changes, accounting adjustment related to acquisitions or dispositions where the Company previously held ownership interest; and non-recurring adjustments pertaining to prior periods.

 

   

ROIC — consolidated net operating profit after taxes divided by average capital. Net operating profit equals earnings before income taxes plus net interest expense and goodwill impairment (including the results of continuing and discontinued operations) minus taxes, excluding the impact of currency and restructuring charges net of related savings. ROIC is further adjusted for the following items that exceed $10 million individually: tax or regulatory changes, accounting adjustments related to acquisitions or dispositions where the Company previously held an ownership interest, and non-recurring adjustments to prior periods. Average capital is the average monthly ending balance of capital employed plus or minus certain adjustments.

 

   

Revenue — Revenue during the period, including continued and discontinued operations. Revenue is adjusted to exclude the impact of currency and the same adjustments as made to EPS, as applicable.

The EPS target is generally based on the Company’s targeted long-term growth rate for EPS, but may be adjusted year-by-year based on economic conditions and the Company’s expected financial performance for the year. From

 

2020 Proxy Statement | 40   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

that target, the Committee then sets levels for threshold and outstanding performance. The threshold EPS growth rate reflects a level of performance that is below target but still appropriate for a partial award to be earned. Conversely, the outstanding EPS growth rate reflects a level of performance appropriate for the maximum incentive to be earned. So the comparisons are valid between the two years, the growth rates are based on growth over results of the previous year excluding non-recurring items.

The ROIC target is then determined based on the earnings growth reflected by the EPS target as well as consideration by the Committee of factors relating to the Company’s level of capital. The Revenue target is generally based on the Company’s targeted long-term growth rate for Revenue. Similar to EPS, it may be adjusted year-by-year based on economic conditions and the Company’s expected financial performance for the year.

This methodology is not the same as the Company’s financial budgeting or business outlook for the year. As a result, target performance for purposes of achieving an incentive award will not be the same as performance at the budgeted financial plan, which may be higher or lower than target performance depending on economic conditions and trends at the time.

Why the Company uses EPS, ROIC and Revenue

The Committee believes using EPS as a performance goal keeps the NEOs focused on producing financial results that align with shareholder interests. In that regard, ManpowerGroup is in a cyclical business, which is influenced by economic and labor market cycles that are outside of ManpowerGroup’s control, and it is important that the senior executives manage short-term results closely to be able to adjust strategy and execution in quick response to external cycle changes. The Company uses ROIC as a performance goal for the NEOs because it measures how effectively our senior management is converting our services into cash. Although we are a provider of services, and not a manufacturer of products, our business is still highly capital intensive. Our requirement for capital arises from the timing characteristics of our business. We typically pay our associates and consultants before we can bill and collect from our clients. Using an ROIC metric incentivizes our executives to carefully manage our accounts receivable and other capital investments in order to maximize the return on capital deployed. Our goal is to continuously improve our internal capital employed each year resulting in stable to improving ROIC. For 2019, the Committee determined to include Revenue as a performance goal in order to incentivize top-line growth, in addition to profitability. It should be noted that, for 2019, the Committee determined that the newly-created Revenue goal should represent a smaller component of the annual incentive awards to our NEOS than the goals for EPS and ROIC, as shown for each of the NEOs below.

For 2019, the Committee continued its practice of setting threshold, target and outstanding goals for EPS and ROIC that were based on its view of appropriate rates of EPS growth compared to prior year achievement. The Committee set threshold, target and outstanding goals for Revenue that were based on its view of appropriate Revenue growth. In setting these levels for 2019, the Committee assumed continued softening in global economic conditions. Correspondingly, the EPS, ROIC and Revenue targets for outstanding performance represent what the Committee believed was an appropriate growth rate for outstanding performance. The Committee believed the threshold levels for EPS, ROIC and Revenue were the minimum levels at which it would be appropriate to earn an incentive, based on global economic conditions as they existed at the time when the goals were set.

Our business is historically cyclical and is impacted by numerous macroeconomic conditions, as noted above in the Executive Summary. The Committee sets each year’s target levels at the beginning of the year, based on both macroeconomic factors and the Company’s business outlook for the coming year, and does so independently of where the target levels have been set for the prior year. Given the cyclical nature of our business, this may result in targets being set lower than for the prior year, as occurred in 2019.

The following table shows the EPS, ROIC and Revenue goals established by the Committee for 2019:

 

       

Goal

     Threshold      Target      Outstanding    

 

EPS

 

    

 

$

 

 

6.82

 

 

 

 

  

 

$

 

 

8.09

 

 

 

 

  

 

$

 

 

9.30

 

 

 

 

 

ROIC

 

    

 

 

 

 

11.3

 

 

 

  

 

 

 

 

13.2

 

 

 

  

 

 

 

 

15.0

 

 

 

 

Revenue (in billions)

 

    

 

$

 

 

21.0

 

 

 

 

  

 

$

 

 

22.0

 

 

 

 

  

 

$

 

 

22.9

 

 

 

 

 

   41 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

Annual Incentive Award Opportunities by NEO

Jonas Prising — Annual Incentive Award Opportunities

The Committee determined that EPS, ROIC and Revenue were the appropriate performance metrics in 2019 for Mr. Prising as the CEO. The following chart shows the Committee’s determination of award opportunities for the annual incentive payable to Mr. Prising for 2019, as a percentage of his 2019 base salary of $1,250,000:

 

       
        Threshold      Target      Outstanding    

 

EPS goal (weighted 30%)

 

    

 

 

 

 

12.00

 

 

 

  

 

 

 

 

48.00

 

 

 

  

 

 

 

 

96.00

 

 

 

 

ROIC goal (weighted 30%)

 

    

 

 

 

 

12.00

 

 

 

  

 

 

 

 

48.00

 

 

 

  

 

 

 

 

96.00

 

 

 

 

Revenue goal (weighted 20%)

 

    

 

 

 

 

8.00

 

 

 

  

 

 

 

 

32.00

 

 

 

  

 

 

 

 

64.00

 

 

 

 

Operating Objectives (weighted 20%)

 

    

 

 

 

 

8.00

 

 

 

  

 

 

 

 

32.00

 

 

 

  

 

 

 

 

64.00

 

 

 

 

Total

 

    

 

 

 

 

40.00

 

 

 

  

 

 

 

 

160.00

 

 

 

  

 

 

 

 

320.00

 

 

 

The operating objectives for Mr. Prising for 2019 were as follows:

 

   

Execute strategic initiatives focused on digitization and transformation of the business

 

   

Diversify the business

 

   

Develop a robust and diverse talent pipeline, including deepening capabilities of employees

 

   

Test and execute new delivery models to drive innovation

 

   

Plan, design and execute strategic initiatives focused on transformation of the business

The Committee determined that Mr. Prising earned a cash incentive award for 2019 between threshold and target for EPS and Revenue, and between target and outstanding for ROIC. The Committee also approved an incentive award to Mr. Prising based on its determination of the level of performance towards achievement of his various operating objectives. Based on these accomplishments, the Committee determined to pay the 2019 award to Mr. Prising as follows:

 

     
      Target Award        Actual Award    

CEO

  

 

$

 

 

2,000,000

 

 

 

 

    

 

$

 

 

1,995,564

 

 

 

 

For 2019, the calculation for EPS and ROIC for Mr. Prising and the other NEOs excluded the following:

 

   

impact of changes in foreign currency exchange rates;

 

   

a goodwill impairment charge;

 

   

restructuring costs net of related savings;

 

   

the contribution to our results of the Switzerland franchise, following the Company’s acquisition of the remaining interests in 2019 as well as the impact of the deconsolidation of our Chinese joint venture;

 

   

One-time accounting gains associated with both the acquisition of the remaining interest of our Swiss Franchise and the deconsolidation of our Chinese joint venture; and

 

   

Tax adjustments that were greater than $10 million.

EPS also excluded the impact of share repurchase activity during the year except to the extent necessary to offset dilution resulting from shares issued under equity plans. The calculation of Revenue excluded the impact of changes in foreign currency exchange rates. See page 26 in the Executive Summary for further detail.

 

2020 Proxy Statement | 42   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

John T. McGinnis — Annual Incentive Award Opportunities

Similar to the CEO, the Committee determined EPS, ROIC and Revenue as the appropriate performance metrics for Mr. McGinnis as the CFO.

The following chart shows the Committee’s determination of award opportunities for the annual incentive payable to Mr. McGinnis for 2019, as a percentage of his 2019 base salary of $725,000.

 

       
        Threshold      Target      Outstanding      

EPS goal (weighted 30%)

       7.5      30.0      60.0

ROIC goal (weighted 30%)

       7.5      30.0      60.0

Revenue (weighted 20%)

       5.0      20.0      40.0

Operating Objectives (weighted 20%)

       5.0      20.0      40.0

Total

       25.0      100.0      200.0

The operating objectives for Mr. McGinnis for 2019 were as follows:

 

   

Deepen leadership impact to meet or exceed strategic and operational goals

 

   

Strengthen senior leadership talent within the finance department, including onboarding of new talent to improve capabilities and strengthen the finance department

The Committee determined that Mr. McGinnis earned a cash incentive award between threshold and target for 2019 for EPS and Revenue, and between target and outstanding for ROIC. The Committee also approved an incentive award for Mr. McGinnis based on its determination of the level of performance towards achievement of his operating objectives. Based on these accomplishments, the Committee determined to pay the 2019 award to Mr. McGinnis as follows:

 

     
        Target Award        Actual Award      

CFO

    

 

$

 

 

725,000

 

 

 

 

    

 

$

 

 

788,655

 

 

 

 

Mara E. Swan — Annual Incentive Award Opportunities

The Committee determined EPS, ROIC and Revenue were the appropriate performance metrics for Ms. Swan, Executive Vice President, Global Strategy and Talent.

The following chart shows the Committee’s determination of award opportunities for the annual incentive payable to Ms. Swan for 2019, as a percentage of her 2019 base salary of $655,000:

 

       
        Threshold      Target      Outstanding    

 

EPS goal (weighted 30%)

 

    

 

 

 

 

7.5

 

 

 

  

 

 

 

 

22.5

 

 

 

  

 

 

 

 

45.0

 

 

 

 

ROIC goal (weighted 30%)

 

    

 

 

 

 

7.5

 

 

 

  

 

 

 

 

22.5

 

 

 

  

 

 

 

 

45.0

 

 

 

 

Revenue (weighted 20%)

 

    

 

 

 

 

5.0

 

 

 

  

 

 

 

 

15.0

 

 

 

  

 

 

 

 

30.0

 

 

 

 

Operating Objectives (weighted 20%)

 

    

 

 

 

 

5.0

 

 

 

  

 

 

 

 

15.0

 

 

 

  

 

 

 

 

30.0

 

 

 

 

Total

 

    

 

 

 

 

25.0

 

 

 

  

 

 

 

 

75.0

 

 

 

  

 

 

 

 

150.0

 

 

 

The operating objectives for Ms. Swan for 2019 were as follows:

 

   

Develop and execute on value and share strategy for several of our brands

 

   

Collaborate with the CEO to map out the evolution of the Company’s brand and organization model

 

   

Develop human resource roadmap to support transformation

 

   43 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

The Committee determined that Ms. Swan earned a cash incentive award between threshold and target for 2019 for EPS and Revenue, and between target and outstanding for ROIC. The Committee also approved an incentive award to Ms. Swan based on its determination of the level of performance towards achievement of her operating objectives. Based on these accomplishments, the Committee determined to pay the 2019 award to Ms. Swan as follows:

 

     
        Target Award        Actual Award    

 

EVP, Global Strategy and Talent

 

    

 

$

 

 

491,250

 

 

 

 

    

 

$

 

 

588,714

 

 

 

 

Richard Buchband — Annual Incentive Award Opportunities

The Committee determined EPS, ROIC and Revenue were the appropriate performance metrics for Mr. Buchband, Senior Vice President, General Counsel and Secretary.

The following chart shows the Committee’s determination of award opportunities for the annual incentive payable to Mr. Buchband for 2019, as a percentage of his 2019 base salary of $525,000.

 

       
        Threshold      Target      Outstanding    

 

EPS goal (weighted 30%)

 

    

 

 

 

 

7.5

 

 

 

  

 

 

 

 

18.0

 

 

 

  

 

 

 

 

36.0

 

 

 

 

ROIC goal (weighted 30%)

 

    

 

 

 

 

7.5

 

 

 

  

 

 

 

 

18.0

 

 

 

  

 

 

 

 

36.0

 

 

 

 

Revenue (weighted 20%)

 

    

 

 

 

 

5.0

 

 

 

  

 

 

 

 

12.0

 

 

 

  

 

 

 

 

24.0

 

 

 

 

Operating Objectives (weighted 20%)

 

    

 

 

 

 

5.0

 

 

 

  

 

 

 

 

12.0

 

 

 

  

 

 

 

 

24.0

 

 

 

 

Total

 

    

 

 

 

 

25.0

 

 

 

  

 

 

 

 

60.0

 

 

 

  

 

 

 

 

120.0

 

 

 

The operating objectives for Mr. Buchband for 2019 were as follows:

 

   

Meet/exceed growth rate of gross profit of certain competitors

 

   

Make progress towards transformation initiatives

 

   

Provide strong leadership and strategic direction to global legal function

 

   

Serve as trusted advisor to the board of directors and executive team

The Committee determined that Mr. Buchband earned a cash incentive award between threshold and target for 2019 for EPS and Revenue, and between target and outstanding for ROIC. The Committee also approved an incentive award for Mr. Buchband based on its determination of the level of performance towards achievement of his operating objectives. Based on these accomplishments, the Committee determined to pay the 2019 award to Mr. Buchband as follows:

 

     
       

Target Award

 

      

Actual Award  

 

 

Senior Vice President, General Counsel and Secretary

 

     $

 

315,000

 

 

 

     $

 

333,585

 

 

 

Ram Chandrashekar — Annual Incentive Award Opportunities

The Committee determined that EPS, ROIC and Revenue were the appropriate performance metrics for Mr. Chandrashekar, the former Executive Vice President, Operational Excellence, Technology and Transformation.

The following chart shows the Committee’s determination of award opportunities for the annual incentive payable to Mr. Chandrashekar for 2019, as a percentage of his 2019 base salary of $672,678:

 

       
        Threshold      Target      Outstanding    

 

EPS goal (weighted 30%)

 

    

 

 

 

 

7.5

 

 

 

  

 

 

 

 

22.5

 

 

 

  

 

 

 

 

45.0

 

 

 

 

ROIC goal (weighted 30%)

 

    

 

 

 

 

7.5

 

 

 

  

 

 

 

 

22.5

 

 

 

  

 

 

 

 

45.0

 

 

 

 

EPS goal (weighted 20%)

 

    

 

 

 

 

5.0

 

 

 

  

 

 

 

 

15.0

 

 

 

  

 

 

 

 

30.0

 

 

 

Operating Objectives (weighted 20%)

 

    

 

 

 

 

5.0

 

 

 

  

 

 

 

 

15.0

 

 

 

  

 

 

 

 

30.0

 

 

 

 

Total

 

    

 

 

 

 

25.0

 

 

 

  

 

 

 

 

75.0

 

 

 

  

 

 

 

 

150.0

 

 

 

 

2020 Proxy Statement | 44   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

The operating objectives for Mr. Chandrashekar for 2019 were as follows:

 

   

Accelerate the development of the Experis brand, achieving operational and strategic plan objectives

 

   

Support the CEO in managing operations, including driving operation excellence in tandem with transformation initiatives

As stated earlier, Mr. Chandrashekar left the Company effective October 31, 2019. Under the terms of the Incentive Plan, Mr. Chandrashekar was entitled to receive a prorated annual incentive for 2019 based on actual performance results for the objectives first approved for him in February 2019.

The Committee determined that Mr. Chandrashekar earned a cash incentive award between threshold and target for 2019 for EPS and Revenue, and between target and outstanding for ROIC. The Committee also approved an incentive award for Mr. Chandrashekar based on its determination of the level of performance towards achievement of his operating objectives. Based on these accomplishments, the Committee determined to pay the 2019 award to Mr. Chandrashekar as follows:

 

     
        Target Award(1)       

Actual Prorated  

Award

 

 

EVP, Operational Excellence, IT and Transformation

 

    

 

$

 

 

504,509

 

 

 

 

    

 

$

 

 

419,734

 

 

 

 

 

  (1)

The target award amount for Mr. Chandrashekar is based on his full annual salary in 2019. His actual award represented 74.9% of target and was prorated through his last day of employment. His target and actual award received have been translated at an exchange rate of 0.789017 (in U.S. Dollars), which was the exchange rate on February 11, 2014, the date Mr. Chandrashekar was promoted an executive officer.

 

Components of the 2019 Executive Compensation Program — Long-Term Incentives

Each year the Committee determines the appropriate mix of performance share units, stock options and restricted stock units that should comprise the long-term incentives for the NEOs. This flexibility allows the Committee to tailor its program to create the incentive structure that it believes will best align executive performance and the needs of the Company. The Committee determined for 2019 that the performance needs of the Company would be best met through a package of awards for the NEOs made up of 60% performance share units, 20% stock options and 20% restricted stock units. We believe this will further align the NEOs’ interests with long-term shareholder value, particularly as 60% of the awards vest based on the achievement of performance criteria. This structure was modified by the Committee for Ms. Swan in 2019, in anticipation that she would choose to retire in 2020. Her awards took the form of restricted stock units. She was not granted performance share units or stock options in 2019.

The performance share units, stock options and restricted stock units awarded in 2019 have the characteristics below. The specific long-term incentive grants for each officer are shown in the Grants of Plan Based Awards table on page 56.

Performance Share Units

For the performance share units granted in 2019, vesting will be based on achievement of a pre-established goal for average annual operating profit margin percent, over a three-year period ending December 31, 2021. The Committee believes operating profit margin percent correctly focuses executive officers on the long-term profitability of the Company. Following completion of the 2019-2021 performance period, the Committee will compare operating profit margin percent performance against target levels to determine the performance share unit payout.

For 2019, the Committee also added a modifier to the final performance share unit payout that can increase or decrease the final performance share unit payout (which will be determined based on the OPMP for the 3-year performance period and the performance gate) by up to 30%. Under this new feature, the Committee establishes strategic growth objectives at the time of the performance share unit grant (in this case, in February 2019) and then

 

   45 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

will evaluate how well management has performed against those pre-established strategic growth objectives during the performance period. The number of shares earned will vest and be settled in common stock in February 2021, after the Committee determines the achievement of the performance goals and assesses the achievement of the strategic growth objectives. The specific strategic growth objectives are summarized below.

Why the Company Uses Annual Operating Profit Margin and How it Sets Goals

The following table shows the goals established by the Committee for the 2019-2021 performance period for these performance share units and the associated payout percentage:

 

       
      Threshold   Target(1)      Outstanding  

Average Operating Profit Margin Percent 2019-2021

 

    

 

 

 

 

2.60

 

 

%

 

   

 

 

 

 

3.60%-3.90%

 

 

 

 

    

 

 

 

 

4.10

 

 

%

 

Payout Percentage

 

      

 

50

 

%

 

     

 

100%

 

 

 

      

 

200

 

%

 

 

  (1)

For 2019, an OPMP range was established for target level performance as the Committee determined setting a precise goal was challenging given uncertainty in the economic environment at the time of grant.

 

To determine the average operating profit margin percent at the end of the three-year period, the actual performance results from each year will be averaged to determine the three-year average performance results. The final award will be determined by using the 3-year payout scale relative to the 3-year average performance. For clarity, an OPMP within the range of 3.60%-3.90% will be considered to be “at target” performance. For results between 2.60% and 3.60% the payout percentage will be calculated by interpolation, and the same method will be used for results between 3.90% and 4.10%.

When determining the financial goals for 2019, the Committee determined that for the 2019 financial year, certain items would be excluded from the OPMP calculation, as described in the following calculation:

 

   

OPMP — annual operating profit divided by revenue from services, with adjustments to be made (a) to reverse the impact of a change in accounting method during the performance period, or (b) for any of the following items that exceed $10 million in any year: goodwill impairment, nonrecurring restructuring gains or charges, accounting adjustments related to acquisitions or dispositions where the Company previously held an ownership interest, litigation charges/settlement, non-recurring accrual adjustments pertaining to periods outside of the period of measurement. In addition, the Committee may determine to adjust operating profit margin to reflect the impact of significant regulatory developments or material acquisitions made by the Company.

Based on the above definition, for 2019, the operating profit margin percent calculation for the NEOs excluded the following:

 

   

a goodwill impairment charge;

 

   

restructuring costs net of related savings;

 

   

the contribution to our results of the Switzerland franchise, following the Company’s acquisition of the remaining interests in 2019;

 

   

impact of the deconsolidation of our Chinese joint venture; and

 

   

One-time accounting gains associated with both the acquisition of the remaining interest of our Swiss Franchise and the deconsolidation of our Chinese joint venture.

Our business is historically cyclical and is impacted by numerous macroeconomic conditions, as noted above in the Executive Summary. The Committee sets each year’s target levels at the beginning of the year, based on both macroeconomic factors and the Company’s business outlook for the coming year, and does so independently of where the target levels have been set for the prior year. Given the cyclical nature of our business, this may result in targets being set lower than for the prior year, as occurred in 2019.

An operating profit “gate” was also established for the performance share units to ensure operating profit margins are achieved without significantly decreasing revenues. This gate was set at $725 million, meaning participants cannot receive more than 100% of the target level payout unless average operating profit for the 2019-2021 performance period exceeds $725.0 million.

 

2020 Proxy Statement | 46   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

As mentioned above, in 2019, the Committee added a modifier to the final performance share unit payout that can increase or decrease the final performance share unit payout by up to 30%. At the end of the 3-year performance period, the Committee will assess the achievement of the strategic growth objectives and may increase or decrease the final performance share unit payout percent (that was determined based on the OPMP for the 3-year performance period and the gate) by an amount up to 30%. The modifier will not decrease the payout below the threshold level nor increase the payout above the outstanding level. The following are the strategic growth objectives set by the Committee for the 2019 grants:

 

   

Implement, test and execute various innovative initiatives to improve business growth and improve efficiency;

 

   

Complete technology and transformation transition and strengthen digital brand; and

 

   

Diversify the business by increasing our footprint in certain countries and markets as well as shifting business mix.

Shares Earned for the 2017-2019 Performance Period

Based on the Company’s average operating margin percent for the 3-year performance period of 2017-2019 of 3.7%, the Committee determined the 2017 performance share unit awards vested at 86% of the target level. The operating profit dollar gate for these awards was also reached. These shares vested and were settled in common stock in February 2020, after the Committee determined the achievement of the performance goals. The number of shares earned for each of the NEOs is as follows:

 

     

NEO

  

Performance Share

Units Granted(#)

  

Performance Share  

Units Earned(#)  

 

Jonas Prising

 

    

 

 

 

 

52,301

 

 

 

    

 

 

 

 

44,892

 

 

 

John T. McGinnis

 

      

 

14,236

 

 

      

 

12,243

 

 

Mara E. Swan

 

      

 

8,356

 

 

      

 

7,186

 

 

Richard Buchband

 

      

 

4,952

 

 

      

 

4,259

 

 

Ram Chandrashekar(1)

 

      

 

11,760

 

 

      

 

 

 

 

  (1)

Mr. Chandrashekar left the Company in October 2019, before the end of the performance period and therefore, under the terms of his performance share unit agreement, he did not vest in any performance share units.

 

Stock Options

The Committee uses stock options to align the interests of the NEOs with long-term shareholder value. Consistent with past years, these will vest ratably over a four-year period.

Restricted Stock Units

As stated earlier, the Committee chose to include restricted stock units because they align the interests of the NEOs with long-term shareholder value and add balance to the compensation program as they provide both upside potential and downside risk. In addition, restricted stock units provide a retention incentive to the NEOs as they are only payable in stock if the NEO remains with the Company through the vesting date. The restricted stock units have a three-year cliff vest.

Career Shares, Retirement and Deferred Compensation Plans

Career Shares

The Committee selectively grants restricted stock units in order to provide a retention incentive. These career shares vest completely on a single date several years into the future. The Committee considers each year whether to make any such grants. None of the NEOs received a career share grant in 2019.

Retirement and Deferred Compensation Plans

ManpowerGroup maintains tax-qualified 401(k) plans for its U.S. employees. For compliance reasons, once an executive is deemed to be “highly compensated” within the meaning of Section 414(q) of the Internal Revenue

 

   47 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

Code, the executive is no longer eligible to participate in ManpowerGroup’s 401(k) plans except for “catch-up” contributions for employees over 50. ManpowerGroup maintains a separate non-qualified savings plan for “highly compensated” employees, including eligible executives. The non-qualified plan provides similar benefits to the tax-qualified 401(k) plans, including a Company match and enhanced matching contribution. However, the nonqualified savings plan is a poor substitute because of the inflexibility as to the timing of the payouts and taxability of the retirement benefits relative to a qualified plan. Furthermore, the plan benefits are unsecured and subject to risk of forfeiture in bankruptcy. The Committee maintains this program in an effort to provide NEOs with reasonably competitive benefits to those in the competitive market.

As required under applicable law, while Mr. Chandrashekar was employed with the Company, we contributed to the Central Provident Fund of Singapore on behalf of Mr. Chandrashekar. The Central Provident Fund is a nondiscriminatory, tax qualified savings plan operated and managed by the government of Singapore, to which the employers of Singapore-based employees are required to contribute. All employees of our Singapore branch participate in the Central Provident Fund.

Other Benefits

The NEOs are provided health and dental coverage, company-paid term life insurance, disability insurance, paid time off, and paid holiday programs applicable to other employees in their locality. These rewards are designed to be competitive with overall market practices, while keeping them at a reasonable level.

ManpowerGroup reimburses NEOs for financial planning assistance. This benefit is provided to ensure that executives prepare adequately for retirement, file their taxes and conduct all stock transactions appropriately. In addition, for several of our NEOs, the company pays dues at a club in Milwaukee that is used for business entertainment. Any personal use of the club would be covered by the executive; however none of the NEOs used this club for personal use in 2019. ManpowerGroup also reimburses the NEOs for annual physicals.

ManpowerGroup also maintains a broad-based auto program that covers approximately 300 management employees in the U.S., including the U.S. based NEOs, except Mr. Prising who no longer participates in the program. Pursuant to this program, ManpowerGroup pays 75% of the cost of a leased car for participating NEOs. For administrative purposes, beginning in 2020, the Company is phasing out the auto leasing program, and as current leases expire, they will instead be replaced with an auto allowance, including for participating NEOs. Consistent with local practice in Singapore, where Mr. Chandrashekar was based, ManpowerGroup provided him with a car while he was employed by the Company in 2019.

Except in connection with expatriate assignments, as discussed below, ManpowerGroup does not pay tax gross ups on taxable benefits for its NEOs.

We Provide Limited Expatriate Benefits

While Mr. Chandrashekar was employed by the Company, in connection with his role as Executive Vice President, Operational Excellence, Technology and Transformation, Mr. Chandrashekar received tax equalization payments related to any compensation earned for the time required to be spent in the United States as part of his role. He also received certain other benefits, including a car and return visit expenses and payment of his tax preparation expenses.

Severance Agreements

ManpowerGroup has entered into severance agreements (which include change of control benefits) with each of the NEOs. These severance agreements are more fully described on pages 66-68. The Committee believes that severance and change of control policies are necessary to attract and retain senior talent in a competitive market. The Committee also believes that these agreements benefit ManpowerGroup because they clarify the NEOs’ terms of employment and protect ManpowerGroup’s business during an acquisition. Furthermore, the Committee believes that change of control benefits, if structured appropriately, allow the NEOs to focus on their duties and responsibilities during an acquisition.

The agreements do not provide for any tax gross up payments and require a double trigger in order for our NEOs to receive benefits following a change in control.

 

2020 Proxy Statement | 48   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

Governance Features of Our Executive Compensation Programs

We Have Stock Ownership Guidelines for Executive Officers

The Committee believes that NEOs should hold a meaningful stake in ManpowerGroup to align their economic interests with those of other shareholders. To that end, the Committee adopted stock ownership guidelines that currently require each executive to own a target number of shares based on a salary multiple, dependent on the NEO’s position. Under the guidelines, the Committee takes into account actual shares owned by the executive, unvested restricted stock units, and unvested performance share units calculated at the threshold level. The Committee does not consider any stock options or performance share units above the threshold level held by the NEOs. Additionally, to enforce our stock ownership policies, we limit the ability of an executive officer to sell equity until he or she is in compliance with the guidelines. An executive who has not yet met, or who falls below, the stock ownership guidelines, is required to hold 50% of the shares received from the exercise of stock options or the vesting of restricted stock units or performance share units until the ownership guidelines have been satisfied. The following table shows the status as of December 31, 2019 of each of the NEOs guidelines:

 

           

NEO

  

Target as

a multiple

of salary

  

Target

value($)(1)

  

Target

number of

shares(#)

  

Number of

shares held as

of December 31,

2019(#)

 

Status as of  

December 31, 2019  

Jonas Prising

       6        6,600,000        94,011        350,240       Guideline Met

John T. McGinnis(2)

       4        2,400,000        32,994        65,597       Guideline Met

Mara E. Swan

       3        1,680,000        23,931        34,150       Guideline Met

Richard Buchband

       2        910,000        12,962        15,551       Guideline Met

Ram Chandrashekar

       3        1,710,000        24,359        (3 )       (3 )

 

(1)

The target values were set as of May 1, 2014 for all NEOs except Mr. McGinnis. Under the policy, executive officers have five years from January 1, 2014 to attain the targeted ownership levels or five years from date of hire for executive officers that were hired after January 1, 2014.

 

(2)

The target values for Mr. McGinnis are based on his base salary and stock price on his date of hire.

 

(3)

Mr. Chandrashekar remained in compliance with his stock ownership guidelines through October 31, 2019, the last day of his employment with the Company.

We Have a Clawback Policy

The Committee maintains a compensation recoupment (“clawback”) policy that is applicable to the members of the Company’s senior management. Under the policy, if the Committee determines an employee engaged in intentional misconduct that causes a financial restatement, the Committee may require the employee to forfeit any outstanding awards, including cash incentives or equity awards that were received as a result of the misconduct.

We Prohibit Hedging, Pledging and Short-Sale Transactions

Under ManpowerGroup’s Insider Trading Policy, all directors, officers and employees of the Company and their respective household members (collectively, “Covered Persons”), including any entities influenced or controlled by a Covered Person, are prohibited from engaging in short sales or hedging transactions involving ManpowerGroup securities, including forward sale or purchase contracts, equity swaps or exchange funds. Covered Persons are also prohibited from engaging in puts, calls or other options or derivative instruments involving ManpowerGroup securities. Further, we do not allow Covered Persons to pledge ManpowerGroup securities at any time, which includes having ManpowerGroup stock in a margin account or using ManpowerGroup stocks as collateral for a loan.

Realizable Pay in 2019

We also calculate realizable pay for Mr. Prising. This is a measure of the value of compensation granted or awarded during the reporting year. It shows the impact of Company performance and stock price on potential pay values for Mr. Prising, and provides an alternative means to the Summary Compensation Table on page 54 to evaluate the alignment between pay and performance.

 

   49 | ManpowerGroup


Table of Contents

 

  Compensation Discussion and Analysis

 

 

In particular, our calculation of realizable pay does not value equity awards using the accounting grant date fair value metric, as required in the Summary Compensation Table under Topic 718. Instead, for realizable pay we measure equity awards at their period-end value, in this case using the year-end stock price on December 31, 2019 of $97.10.

For realizable pay our method of calculating equity award values is as follows:

 

   

Stock Options. We use the “intrinsic value” of the stock options granted to Mr. Prising in February 2019, meaning the spread between the grant price and the price of the underlying stock at year end.

 

   

Restricted Stock Units. We use the year-end value of the restricted stock units awarded to Mr. Prising in February 2019 and value these shares using the year-end stock price on December 31, 2019.

 

   

Performance Share Units. We calculate performance share units using the target performance shares granted in 2019 and value these shares using the year-end stock price on December 31, 2019.

Our realizable pay calculation reflects the significant equity component of Mr. Prising’s total compensation and illustrates how the value of Mr. Prising’s 2019 compensation is sensitive to movements in our stock price. The Company’s stock price increased significantly during 2019: from $64.80 on January 1, 2019 to $97.10 as of December 31, 2019. In addition, the December 31, 2019 stock price was higher than the fair market value used to value the equity grants of $84.83 as of February 15, 2019 (the closing stock price on the date of grant). This appreciation in stock price resulted in Mr. Prising’s calculated realizable pay being $13.1 million for 2019. This is slightly higher than $12.5 million of total compensation shown in the Summary Compensation Table using SEC reporting methodology. It also reflects a 111% increase from his realizable pay for 2018, when considerable stock price depreciation and below-target operating performance resulted in realizable pay that was significantly lower than reported compensation.

The table below shows realizable pay for Mr. Prising in 2019 as compared to his compensation as reported in the Summary Compensation Table on page 54.

Supplemental Table of CEO Realizable Compensation

 

     
     

2019 Compensation

as Reported in the

Summary

Compensation Table

  

2019 Total Realizable  

Compensation  

Base Salary

     $ 1,250,000      $ 1,250,000

Annual Incentive

       1,995,564        1,995,564
    

 

 

      

 

 

 

Total Cash

       3,245,564        3,245,564
    

 

 

      

 

 

 

Stock Options

       1,850,009        1,318,314

Restricted Stock Units

       1,850,030        2,127,655

Performance share units

       5,550,006        6,382,869
    

 

 

      

 

 

 

Total

       12,495,609        13,074,402
    

 

 

      

 

 

 

Other Material Tax Implications of the Executive Compensation Program

Tax Implications for ManpowerGroup

Section 162(m) of the Internal Revenue Code generally disallows a tax deduction to public corporations for compensation over $1,000,000 paid in any tax year to any “covered employee.” Covered employees include the corporation’s CEO, CFO and each of its three most highly compensated NEOs (other than the CEO and CFO) regardless of whether they were in service as of the end of any such tax year.

Further, for each NEO whose compensation was or is subject to this limitation in 2017 or any later tax year, that officer’s compensation will remain subject to this annual deductibility limitation for any future tax year in which he or she receives compensation from ManpowerGroup, regardless of whether he or she remains a NEO.

 

2020 Proxy Statement | 50   


Table of Contents

 

Compensation Discussion and Analysis  

 

 

Accordingly, ManpowerGroup is only able to deduct up to $1,000,000 per year of the compensation payable to any of our NEOs who is a “covered employee” as determined under Section 162(m), except to the extent that transition relief for grandfathered arrangements that were in effect on November 2, 2017, if applicable, would apply to a payment.

Tax Implications for NEOs

The Committee generally seeks to structure compensation amounts and arrangements so that they do not result in penalties for the NEOs under the Internal Revenue Code. For example, Section 409A imposes substantial penalties and results in the loss of any tax deferral for nonqualified deferred compensation that does not meet the requirements of that section. The Committee has structured the elements of ManpowerGroup’s compensation program so that they are either not characterized as nonqualified deferred compensation under Section 409A or meet the distribution, timing and other requirements of Section 409A. Without these steps, certain elements of compensation could result in substantial tax liability for the NEOs. Section 280G and related provisions impose substantial excise taxes on so-called “excess parachute payments” payable to certain executives upon a change of control and results in the loss of the compensation deduction for such payments by the executive’s employer. The severance agreements with the NEOs limit the amount of the severance payment in the event that the severance payment will be subject to excise taxes imposed under Section 280G, but only where the after-tax amount received by the NEO would be greater than the after-tax amount without regard to such limitation.

 

   51 | ManpowerGroup


Table of Contents

 

  Report of the Executive Compensation and Human Resources Committee of the Board of Directors

 

 

Report of the Executive Compensation and Human Resources Committee of the Board of Directors

The executive compensation and human resources committee of the board of directors of ManpowerGroup has reviewed and discussed with management the Compensation Discussion and Analysis included in this proxy statement. Based on this review and discussion, the executive compensation and human resources committee recommended to the board of directors that the Compensation Discussion and Analysis be included in this proxy statement.

The Executive Compensation and Human Resources Committee

Elizabeth P. Sartain, Chair

Cari M. Dominguez

William Downe

Julie M. Howard

Executive Compensation and Human Resources Committee Interlocks and Insider Participation

No member of the executive compensation and human resources committee has ever been an officer or employee of ManpowerGroup or any of our subsidiaries or had any relationships requiring disclosure under Item 404 of Regulation S-K. None of our executive officers has served on the compensation committee or board of directors of any company of which any of our other directors is an executive officer.

 

2020 Proxy Statement | 52   


Table of Contents

 

Compensation Policies and Practices as They Relate to Risk Management  

 

 

Compensation Policies and Practices as They Relate to Risk Management

Members of the Company’s senior management team have considered and discussed the Company’s compensation policies and practices and specifically whether these policies and practices create risks that are reasonably likely to have a material adverse effect on ManpowerGroup. Management has also discussed this issue with the executive compensation and human resources committee and has determined there are no risks arising from our compensation policies and practices that are reasonably likely to have a material adverse effect on ManpowerGroup.

As ManpowerGroup operates in various countries around the world, we have several incentive plans. Our plans use various financial performance growth metrics, generally relating to profitability. As a result, there is no common incentive driving behavior. We also have controls in place that mitigate any impact these plans might have on us as follows:

 

   

In general, each of our incentive plans has a threshold, target and outstanding payout level, which is not material to the Company, that is earned based on the results of the financial metrics.

 

   

The annual incentive and performance share unit awards are capped at a maximum level such that employees cannot receive a bonus that is significant enough to create a significant risk to the Company.

 

   

We have multiple financial metrics under the annual incentive which focus on company-wide and segment-wide goals and objectives, and the results of those metrics are reviewed and approved at multiple levels in the Company.

 

   

There is an approval process of the various incentive plans in each country, which are approved by the general manager and financial manager in the respective country to ensure the growth metrics are based on that respective country’s performance.

 

   

Each of the NEOs is subject to stock ownership guidelines.

 

   

We have adopted a clawback policy.

 

   

We do not permit executives to engage in short-selling of ManpowerGroup securities or trading in puts and calls on ManpowerGroup securities.

 

   

We do not permit our NEOs to pledge shares of our common stock.

Based on the above factors, we do not believe our compensation policies and practices create risks that are reasonably likely to have a material adverse effect on ManpowerGroup.

 

   53 | ManpowerGroup


Table of Contents

 

  Compensation Tables

 

 

Compensation Tables

Summary Compensation Table

The table below sets forth the compensation information for our NEOs during the fiscal years ended December 31, 2019, December 31, 2018, and December 31, 2017. All amounts are calculated in accordance with SEC disclosure rules, including amounts with respect to our equity compensation plan awards, as further described below.

 

                   

Name &

Principal Position

  Year  

Salary

($)

 

Bonus

($)

 

Stock

Awards

($)(1)

 

Option

Awards

($)(2)

 

Non-Equity

Incentive

Plan

Compensation

($)

 

Change in

Pension

Value and

Non-
Qualified

Deferred

Compensation

Earnings

($)

 

All

Other

Compensation

($)(3)

 

Total

($)

Jonas Prising

      2019       1,250,000             7,400,036       1,850,009       1,995,564             50,323       12,545,932  

CEO

      2018       1,250,000             7,200,060       1,800,015       1,137,277             56,658       11,444,010  
        2017       1,250,000             6,760,111       1,690,019       2,240,546             47,197       11,987,873  

John T. McGinnis

      2019       725,000             2,040,082       510,002       788,655             66,704       4,130,443  

CFO

      2018       700,000             1,920,089       480,017       500,000             88,227       3,688,333  
        2017       650,000             1,840,115       460,005       755,040             43,798       3,748,958  

Mara E. Swan

      2019       655,000             1,350,036             588,714             65,593       2,659,343  

EVP, Global Strategy

      2018       610,000             1,080,150       270,021       330,000             67,788       2,357,959  

& Talent

      2017       610,000             1,080,106       270,022       546,682             61,507       2,568,317  

Richard Buchband

      2019       525,000             640,148       160,002       333,585             59,972       1,718,707  

SVP, General Counsel

      2018       500,000             640,153       160,006       215,000             66,539       1,581,698  

and Secretary

      2017       500,000             640,095       160,003       343,500             47,266       1,690,864  

Ram Chandrashekar(4)

      2019       555,148             1,520,077       380,012       419,734             1,723,405       4,598,376  

Former EVP, Operational

      2018       627,849             1,520,148       380,005       578,124             367,155       3,473,281  

Excellence, Technology

and Transformation

      2017       627,849             1,520,019       380,016       653,967             175,269       3,357,120  

 

(1)

The value of stock awards in this table for all years includes the grant date fair value (calculated at the target level) for performance share units and restricted stock units (including career shares) as computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718, “Stock Compensation.” See page 56 for the breakout in the grant date fair value of performance share units (“PSUs”) and restricted stock units (RSUs”).

 

    

The grant date fair value of the 2019 PSU awards at the outstanding (maximum) level for each executive officer was:

 

   

Name

   2019

Jonas Prising

     $ 11,100,012  

John T. McGinnis

     $ 3,060,081  

Mara E. Swan

     $ —  

Richard Buchband

     $ 960,138  

Ram Chandrashekar

     $ 2,280,117  

 

(2)

The value of options in this table represents the grant date fair value of the stock options as computed in accordance with FASB ASC Topic 718.

 

(3)

These amounts are described in further detail in the All Other Compensation in 2019 Table.

 

(4)

Mr. Chandrashekar left the Company effective October 31, 2019. The amount reported in the Salary column represents his salary through his last day of employment. Mr. Chandrashekar’s salary and incentive payment were paid in SGD. These amounts have been translated at an exchange rate of 0.789017 (in U.S. Dollars), which was the exchange rate on February 11, 2014, the date Mr. Chandrashekar was promoted to an Executive Vice President. See the All Other Compensation Table In 2019 for the rates used to calculate the amounts in the all other compensation column. Based on the exchange rate of 0.743 (in U.S. Dollars), as of December 31, 2019, Mr. Chandrashekar’s salary was $522,770 and incentive compensation was $395,255.

 

2020 Proxy Statement | 54   


Table of Contents

 

Compensation Tables  

 

 

All Other Compensation in 2019

 

           

Name & Principal Position

  

Perquisites

& Other

Personal

Benefits

($)(1)

 

Tax

Reimbursements

($)

 

Payments/

Accruals

on

Termination

Plans

($)

 

Company

Contributions

to Defined

Contribution

Plans

($)(2)

  

Total Other

  Compensation  

($)

Jonas Prising

CEO

       17,823                   32,500        50,323

John T. McGinnis

CFO

       34,204                   32,500        66,704

Mara E. Swan

EVP, Global Strategy and Talent

       33,093                   32,500        65,593

Richard Buchband

SVP, General Counsel and Secretary

       30,992                   28,980        59,972

Ram Chandrashekar

Former EVP, Operational Excellence,

Technology and Transformation

       56,270 (3)       342,014 (4)       1,312,237 (5)       12,884        1,723,405

 

(1)

Except as otherwise indicated, these amounts include the value attributable to each executive’s participation in ManpowerGroup’s company car program, auto insurance, the cost of an annual physical, life insurance premiums paid and/or the value of financial services paid for by ManpowerGroup. Any of these items with a value greater than $25,000 are separately disclosed below.

 

(2)

Other than for Mr. Chandrashekar, these contributions were made by ManpowerGroup on behalf of the executive officers under the terms of the Nonqualified Savings Plan and the Company’s 401(k) Plan to the extent the NEO has made a “catch-up” contribution. For Mr. Chandrashekar, the amount represents our contributions to the Central Provident Fund of Singapore (CPF). Further information regarding the Nonqualified Savings Plan can be found in the Nonqualified Deferred Compensation Table and accompanying narrative.

 

(3)

In addition to the items described above in footnote (1), $30,881 reflects the lease and maintenance payments associated with Mr. Chandrashekar’s car while still an employee and $21,335 for tax preparation services. These items have been translated at an exchange rate for SGD of 0.743 (in U.S. Dollars) which was the exchange rate in effect on December 31, 2019.

 

(4)

This amount reflects tax payments paid on Mr. Chandrashekar’s behalf for compensation he received in 2019 in connection with time spent in the United States as part of his roles and responsibilities, including taxes paid related to his severance compensation.

 

(5)

This amount reflects certain severance benefits paid to Mr. Chandrashekar upon his departure from the Company. Of this amount, $1,089,135 relates to severance compensation paid to Mr. Chandrashekar under the terms of his severance agreement with the Company, and $15,000 is for reimbursement for the driver contract cost incurred as part of Mr. Chandrashekar’s automobile benefit he was entitled to in connection with his assignment to Singapore. The remaining $208,102 represents unused vacation time, which, as required under Singapore law, is required to be paid out upon departure from a company. These items have been translated at an exchange rate for SGD of 0.732 (in U.S. Dollars) which was the exchange rate in effect on December 2, 2019, the date of payment.

 

   55 | ManpowerGroup


Table of Contents

 

  Compensation Tables

 

 

Grants of Plan-Based Awards in 2019

 

               
        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)

 

All Other

Option

Awards:

Number of

Securities

Underlying

Options

(#)(4)

 

Exercise

or Base

Price of

Option

Awards

($/Sh)

 

Grant

Date

Fair

Value of

Stock

and

Option

Awards

($)(5)

Name &

Principal Position

 

Grant

Date

 

Threshold

($)

 

Target

($)

 

Maximum

($)

 

Threshold

(#)

 

Target

(#)

 

Maximum

(#)

Jonas Prising

CEO

      2/15/2019       500,000       2,000,000       4,000,000                                           —  
      2/15/2019                         32,868       65,735       131,470                         5,550,006  
      2/15/2019                                           21,912                   1,850,030  
      2/15/2019                                                 104,050       84.43       1,850,009  

John T. McGinnis

CFO

      2/15/2019       181,250       725,000       1,450,000                                           —  
      2/15/2019                         9,061       18,122       36,244                         1,530,040  
      2/15/2019                                           6,041                   510,042  
      2/15/2019                                                 28,684       84.43       510,002  

Mara E. Swan

EVP, Global

Strategy and Talent

      2/15/2019       163,750       491,250       982,500                                           —  
      2/15/2019                                           15,990                   1,350,036  
      2/15/2019                                                             —  

Richard Buchband

SVP, General

Counsel and

Secretary

      2/15/2019       131,250       315,000       630,000                                           —  
      2/15/2019                         2,843       5,686       11,372                         480,069  
      2/15/2019                                           1,896                   160,079  
      2/15/2019                                                 8,999       84.43       160,002  

Ram Chandrashekar(6)

Former EVP, Operational

Excellence, Technology

and Transformation

      2/15/2019       168,170       504,509       1,009,017                                           —  
      2/15/2019                         6,752       13,503       27,006                         1,140,058  
      2/15/2019                                           4,501                   380,019  
      2/15/2019                                                 21,373       84.43       380,012  

 

(1)

These amounts represent the threshold, target, and maximum annual cash incentive awards established under the Annual Incentive Plan. The amounts for Mr. Chandrashekar represent the threshold, target, and maximum annual cash incentive for the full year.

 

(2)

These amounts represent the number of PSUs that could be earned related to the PSUs granted in 2019 under the 2011 Equity Incentive Plan.

 

(3)

Amounts represent the number of restricted stock units granted in 2019 under the 2011 Equity Incentive Plan.

 

(4)

These amounts represent the number of shares underlying stock options that were granted in 2019 under the 2011 Equity Incentive Plan.

 

(5)

The grant date fair value of stock and option awards granted in 2019 that are reported in this column have been computed in accordance with FASB ASC Topic 718.

 

(6)

Mr. Chandrashekar left the Company effective October 31, 2019. Under the terms of his equity agreements, he will not vest in any of the performance share units, restricted stock units or stock options granted to him in 2019.

Compensation Agreements and Arrangements

Mr. Prising, Mr. McGinnis, Mr. Buchband, and Ms. Swan currently receive an annual incentive bonus determined pursuant to an incentive arrangement with ManpowerGroup and all have entered into severance agreements with ManpowerGroup. The annual incentive bonus arrangements are described in further detail in the Compensation Discussion and Analysis included in this proxy statement and the severance agreements for each executive officer are described in further detail in the section entitled “Termination of Employment and Change of Control Arrangements” following the Nonqualified Deferred Compensation Table.

Upon his departure from the Company, Mr. Chandrashekar received certain compensation and benefits under his severance agreement dated August 2, 2019. All of the benefits under his severance agreement were contingent upon Mr. Chandrashekar signing a complete release of claims in favor of ManpowerGroup. At the time he signed this release, the Company and Mr. Chandrashekar agreed to a final settlement of his tax equalization payments related to any compensation earned by him for the time he was required to be in the United States as part of his role.

 

2020 Proxy Statement | 56   


Table of Contents

 

Compensation Tables  

 

 

2019 Annual Incentive Award Calculations

The following tables illustrate the achievement of the performance targets in relation to the payment of the 2019 Annual Incentive Awards. The awards are reflected in the Summary Compensation Table on page 54 under the heading “Non-Equity Incentive Plan Compensation.”

For 2019, ManpowerGroup’s EPS, as reported, was $7.72, ROIC was 13.2% and Revenue was $20.9 billion.

When it adopted financial targets for the 2019 performance year, the Committee determined that certain items should be excluded from our performance metrics to ensure our NEOs are compensated only for the underlying performance of our business. For 2019, the Committee’s calculation of EPS for Mr. Prising and the other NEOs excluded the following, along with the related impact to EPS:

 

   

impact of changes in foreign currency exchange rates (an increase to EPS of $0.28);

 

   

impact of share repurchase activity during the year except to the extent necessary to offset dilution resulting from shares issued under equity plans (a decrease to EPS of $0.12);

 

   

a goodwill impairment charge (an increase to EPS of $1.09);

 

   

restructuring costs net of related savings (an increase to EPS of $0.27);

 

   

the contribution to our results of the Switzerland franchise, following the Company’s acquisition of the remaining interests in 2019 as well as the impact of the deconsolidation of our Chinese joint venture (a total increase to EPS of $0.06);

 

   

One-time accounting gains associated with both the acquisition of the remaining interest of our Swiss franchise and the deconsolidation of our Chinese joint venture (a decrease to EPS of $1.82); and

 

   

Tax adjustments that were greater than $10 million (an increase to EPS of $0.24).

These adjustments resulted in the Committee utilizing an EPS figure of $7.72 in calculating annual incentive compensation for 2019. This compared to EPS goals of $6.82 at threshold, $8.09 at target and $9.30 at outstanding.

The ROIC calculation in 2019 excluded the following, along with the related impact to ROIC:

 

   

impact of changes in foreign currency exchange rates (an increase to ROIC of 0.5%);

 

   

a goodwill impairment charge (an increase to ROIC of 1.2%);

 

   

restructuring costs net of related savings (an increase to ROIC of 0.5%);

 

   

the contribution to our results of the Switzerland franchise, following the Company’s acquisition of the remaining interests in 2019 as well as the impact of the deconsolidation of our Chinese joint venture (a total increase to ROIC of 0.1%);

 

   

One-time accounting gains associated with both the acquisition of the remaining interest of our Swiss franchise and the deconsolidation of our Chinese joint venture (a decrease to ROIC of 2.0%); and

 

   

Tax adjustments that were greater than $10 million (an increase to ROIC of 0.2%).

These adjustments resulted in the Committee utilizing an ROIC figure of 13.7% in calculating annual incentive compensation for 2019. This compared to ROIC goals of 11.3% at threshold, 13.2% at target and 15.0% at outstanding.

The Revenue calculation in 2019 excluded the impact of changes in foreign currency exchange rates (an increase to Revenue of $0.9 billion). These adjustments resulted in the Committee utilizing a Revenue figure of $21.8 billion in calculating annual incentive compensation for 2019. This compared to Revenue goals of $21.0 billion at threshold, $22.0 billion at target and $22.9 billion at outstanding.

 

   57 | ManpowerGroup


Table of Contents

 

  Compensation Tables

 

 

Jonas Prising — 2019 Annual Incentive Calculation

 

       
     

Performance

Level

  

Percentage

of 2019

Salary

 

Amount

Earned

EPS Goal

       Above Threshold        37.5 %     $ 468,897  

ROIC Goal

       Above Target        61.3 %     $ 766,667  

Revenue Goal

       Above Threshold        27.2 %     $ 340,000  

Operating Objectives

       Above Target        33.6 %     $ 420,000  

Total Incentive

                  159.6 %     $ 1,995,564  

John T. McGinnis — 2019 Annual Incentive Calculation

 

       
     

Performance

Level

  

Percentage

of 2019

Salary

 

Amount

Earned

EPS Goal

       Above Threshold        23.4 %     $ 169,940  

ROIC Goal

       Above Target        38.3 %     $ 277,965  

Revenue Goal

       Above Threshold        17.0 %     $ 123,250  

Operating Objectives

       Above Target        30.0 %     $ 217,500  

Total Incentive

                  108.7 %     $ 788,655  

Mara E. Swan — 2019 Annual Incentive Calculation

 

       
     

Performance

Level

  

Percentage

of 2019

Salary

 

Amount

Earned

EPS Goal

       Above Threshold        18.1 %     $ 118,751  

ROIC Goal

       Above Target        28.8 %     $ 188,313  

Revenue Goal

       Above Threshold        13.0 %     $ 85,150  

Operating Objectives

       At Outstanding        30.0 %     $ 196,500  

Total Incentive

                  89.9 %     $ 588,714  

Richard Buchband — 2019 Annual Incentive Calculation

 

       
     

Performance

Level

  

Percentage

of 2019

Salary

 

Amount

Earned

EPS Goal

       Above Threshold        14.9 %     $ 78,435  

ROIC Goal

       Above Target        23.0 %     $ 120,750  

Revenue Goal

       Above Threshold        10.6 %     $ 55,650  

Operating Objectives

       Above Target        15.0 %     $ 78,750  

Total Incentive

                  63.5 %     $ 333,585  

 

2020 Proxy Statement | 58   


Table of Contents

 

Compensation Tables  

 

 

Ram Chandrashekar — 2019 Annual Incentive Calculation(1)

 

       
     

Performance

Level

    

Percentage

of 2019

Salary

  

Amount

Earned

EPS Goal

       Above Threshold          18.1 %      $ 101,458  

ROIC Goal

       Above Target          28.8 %      $ 161,436  

Revenue Goal

       Above Threshold          13.0 %      $ 72,871  

Operating Objectives

       At Target          15.0 %      $ 83,969  

Total Incentive

                    74.9 %      $ 419,734  

 

(1)

The Amount Earned for Mr. Chandrashekar represents a prorated amount through the last day of his employment effective October 31, 2019. Mr. Chandrashekar’s incentive is paid in SGD and has been translated above at an exchange rate of 0.789017 (in U.S. Dollars), which was the exchange rate on February 11, 2014, the date Mr. Chandrashekar was first promoted to Executive Vice President.

 

   59 | ManpowerGroup


Table of Contents

 

  Compensation Tables

 

 

Grants Under the 2011 Equity Incentive Plan

Stock options. ManpowerGroup made grants of stock options to all of the executive officers under the 2011 Equity Incentive Plan in February 2019, except Ms. Swan who did not receive stock options. The stock options granted in 2019 vest 25% per year over a four-year period and if they are not exercised, they expire in ten years (or earlier following a termination of employment). Additional vesting terms applicable to these options are described in further detail in the section entitled “Termination of Employment and Change of Control Arrangements” following the Nonqualified Deferred Compensation Table.

PSUs. ManpowerGroup made grants of PSUs to all of the executive officers under the 2011 Equity Incentive Plan in February 2019, except Ms. Swan who did not receive PSUs in 2019. Each executive officer received a performance share unit grant that will vest if the relevant performance goal of average Operating Profit Margin Percentage is met for the three-year performance period. For 2019, the Committee also added a modifier to the final performance share unit payout that can increase or decrease the final performance share unit payout (that was determined based on the OPMP for the 3-year performance period and the gate) by up to 30%. The modifier is based on an evaluation of pre-established strategic growth initiatives over the performance period. See page 45 for description of the goals and initiatives established by the Committee for the 2019 performance share unit grants.

No dividends are paid on the PSUs unless and until actual shares are issued to the executive officer upon the vesting of the PSUs and in such case, dividends would be paid only for record dates occurring after the issuance date. Additional vesting terms applicable to these grants are described in further detail in the section entitled “Termination of Employment and Change of Control Arrangements” following the Nonqualified Deferred Compensation Table.

Restricted stock units. The restricted stock units granted to the executive officers under the 2011 Equity Incentive Plan in February 2019 have a three-year cliff vest and are earned as long as the executive officer continues to be employed by the Company. Dividend equivalents are accumulated on the restricted stock units under these awards and vest on the same basis as the underlying award. Additional vesting terms applicable to these grants are described in further detail in the section entitled “Termination of Employment and Change of Control Arrangements” following the Nonqualified Deferred Compensation Table.

Career shares. ManpowerGroup did not make any career share grants to any of the NEOs in 2019.

 

2020 Proxy Statement | 60   


Table of Contents

 

Compensation Tables  

 

 

Outstanding Equity Awards at December 31, 2019

 

     
    Option Awards   Stock Awards

Name & Principal

Position

 

Number of

Securities

Underlying

Unexercised

Options

(#)

Exercisable

 

Number of

Securities

Underlying

Unexercised

Options

(#)

Unexercisable

 

Equity

Incentive

Plan Awards:

Number of

Securities

Underlying

Unexercised

Unearned

Options (#)

 

Option

Exercise

Price

($)

 

Option

Expiration

Date

 

Number

of Shares

or Units

of Stock

that Have

Not Vested

(#)(1)

 

Market

Value

of Shares

or Units

of Stock

that Have

Not Vested

($)(2)

 

Equity

Incentive

Plan Awards:

Number of

Unearned

Shares, Units,

or Other

Rights

that Have

Not Vested

(#)(3)

 

Equity

Incentive

Plan Awards:

Market or

Payout Value

of Unearned

  Shares, Units,  

or Other

Rights

that Have

Not Vested

($)(2)

Jonas Prising

CEO

      9,934                 —             $ 67.12       2/16/2021                        
      16,812                 —             $ 44.81       2/15/2022                        
      24,883                 —             $ 52.55       2/13/2023                        
      15,681                 —             $ 76.13       2/11/2024                        
      26,510                 —             $ 82.24       5/1/2024                        
      52,078                 —             $ 76.97       2/10/2025                        
      57,165           19,055 (4)       —             $ 75.07       2/16/2026                        
      33,034           33,034 (5)       —             $ 96.94       2/9/2027                        
      14,304           42,912 (6)       —             $ 122.87       2/15/2028                        
      —           104,050 (7)       —             $ 84.43       2/15/2029                        
      —                 —                           18,562 (8)     $ 1,802,370            
      —                 —                           15,348 (9)     $ 1,490,291            
      —                 —                           22,442 (10)     $ 2,179,118            
      —                 —                           44,892 (12)     $ 4,359,013            
      —                 —                                       43,949 (13)     $ 4,267,448
        —                 —                                       65,735 (14)     $ 6,382,869

John T. McGinnis

CFO

      15,244           5,082 (4)       —             $ 75.07       2/16/2026                        
      8,991           8,992 (5)       —             $ 96.94       2/9/2027                        
      3,814           11,444 (6)       —             $ 122.87       2/15/2028                        
      —           28,684 (7)       —             $ 84.43       2/15/2029                        
      —                 —                           5,053 (8)     $ 490,646            
      —                 —                           4,094 (9)     $ 397,527            
      —